Corporate Social Responsibility, Sustainability Reporting and Forest Fires: Evidence from the 2018 Megafires»

Aristotle University of Thessaloniki

Faculty of Agriculture, Forestry and Natural Environment

Department of Forestry and Natural Environment

MSc in Natural Resources: Monitoring, Technology and Bio – Economy

«Corporate Social Responsibility, Sustainability Reporting and Forest Fires: Evidence from the 2018 Megafires»

Master Thesis by: Eleni Stathi

Supervisor:

Ioannis Gitas

Thessaloniki, July 2021 Abstract

This study explores the way that the top Greek and Californian corporations responded to the 2018 megafires, of Mati, Attica and Camp Fire, California. As megafires are becoming more often and their impacts more destructive, through the years, coordinated efforts are directed towards elimination of these tragic events and building of resilient communities. The private sector can play a vital role to achieving these goals, through philanthropic activities that are part of their Corporate Social Responsibility (CSR) and usually expressed by the corporations’ sustainability reporting (SR). Based on CSR and natural disaster literature, and with the empirical data that were collected, the current research shows A) an important movement from both the Greek and Californian corporations towards the disaster relief efforts, B) the existence of different CSR patterns between the two regions and C) an extensive use of SR of the CSR performers. This is an empirical study among the first that comparatively examine CSR during two megafires in two different parts of the world and aims to add to the existing literature, as well as give a new perspective for future researchers, for corporations and public authorities.

Key- words: California wildfires, Mati wildfire, resilience, natural disasters, corporate philanthropy, GRI

Περίληψη

Η παρούσα εργασία ερευνά τον τρόπο με τον οποίο έδρασαν οι εταιρείες σε Ελλάδα και Καλιφόρνια κατά τις μεγαπυρκαγιές του 2018, σε Μάτι, Αττικής και στην Camp Fire, στην Καλιφόρνια. Καθώς οι μεγαπυρκαγιές γίνονται όλο και πιο συχνές και οι συνέπειές τους όλο και πιο καταστροφικές, κατά τη διάρκεια των χρόνων, γίνονται συντονισμένες προσπάθειες προς τον περιορισμό αυτών των τραγικών γεγονότων και την οικοδόμηση της ανθεκτικότητας στην κοινωνία. Ο ιδιωτικός τομέας μπορεί να διαδραματίσει σημαντικό ρόλο προς στην επίτευξη των στόχων αυτών, μέσω φιλανθρωπικών ενεργειών που είναι μέρος της Εταιρικής Κοινωνικής τους Ευθύνης (ΕΚΕ) και συνήθως εκφράζεται μέσα από τις εκθέσεις βιωσιμότητας. Βασιμένη στη σχετική με την ΕΚΕ και τις φυσικές καταστροφές βιβλιογραφία και με τη συλλογή εμπειρικών δεδομένων, η παρούσα έρευνα αποδεικνύει Α) μια σημαντική κινητοποίηση τόσο των εταιρειών στη Ελλάδα όσο και των εταιρειών στην Καλιφόρνια, στην προσπάθεια αντιμετώπισης της καταστροφής, Β) την ύπαρξη διαφορετικών μοτίβων ΕΚΕ ανάμεσα στις δυο περιοχές και Γ) μια εκτεταμένη χρήση των εκθέσεων βιωσιμότητας από τις εταιρείες εκείνες που έδρασαν με ΕΚΕ. Αυτή είναι μία εμπειρική εργασία, ανάμεσα στις πρώτες που εξετάζουν συγκριτικά την ΕΚΕ κατά τη διάρκεια δύο μεγαπυρκαγιών σε δύο διαφορετικά μέρη του πλανήτη και στοχεύει να προσθέσει γνώση στην υπάρχουσα βιβλιογραφία, καθώς και να δώσει μία νέα προοπτική σε μελλοντικούς ερευνητές, σε επιχειρήσεις και σε δημόσιους φορείς.

Acknowledgements

With this master thesis my studies at MCs in Natural Resources: Monitoring, Technology and Bio – Economy are completed. I would like to thank the members of the thesis Examination Committee:

Ioannis Gitas, for accepting to supervise this thesis and help me accomplish my master studies. Through his lessons and his insights, he contributed to my understanding on forest fires, their monitoring and management.

Konsatntinos Papaspyropoulos, for his helpful advice and guidance during this master. I appreciate that he recognised my background in Economic Sciences and directed me this topic. His suggestions on Sustainability Reporting and Forestry matters, as well as his encouragement were of main importance.

Marios Trigkas, for his advice and the fresh insights of his teaching, that combines environmental with business and economics aspects. He has always been eager to help and support all of his students.

Finally, I couldn’t have done it with the support of my friends and family, they have always been by my side and I would like to express my gratitude to them.

Thank you all!

Contents

Glossary ...... 5 1. Introduction ...... 7 2 Forest Fires ...... 10 2.1 Forest Fires in Greece ...... 11 The 2018 fires in Greece ...... 14 2.2 Forest Fires in California (U.S.) ...... 17 The 2018 fires in California ...... 20 3 Corporate Social Responsibility and Sustainability Reporting...... 23 3.1 Corporate Social Responsibility ...... 23 Stakeholder Theory ...... 23 Institutional Theory ...... 25 Legitimacy Theory ...... 26 Other Theories ...... 27 Integration of Theories ...... 28 3.2 Sustainability Reporting ...... 29 3.2.1 Sustainability Reporting in Greece ...... 31 3.2.2 Sustainability Reporting in California ...... 32 4 Research Process ...... 34 4.1 Research Design ...... 34 4.2 Conceptual Development ...... 35 4.2.1 CSR philanthropic activity in Greece VS California ...... 35 4.2.2 CSR patterns of the Greek and Californian corporations ...... 36 4.2.3 Sustainability Reporting of the CSR performers ...... 36 4.3 Research Method ...... 37 5. Findings and Discussion ...... 40 5.1 General Data Characteristics ...... 40 5.2 CSR philanthropic activity in Greece VS California: Answering Q1 ...... 42 5.3 CSR patterns of the Greek and Californian corporations: Answering Q2 ...... 43 Extra analysis ...... 46 5.4 Sustainability Reporting of the CSR performers: Answering Q3 ...... 47 6. Conclusions ...... 49 References ...... 52

Glossary

Natural Disaster

A natural disaster is an event caused by a natural hazard. United Nations (2009), define a natural hazard as the natural process or phenomenon that may cause loss of life, injury or other health impacts, property damage, loss of livelihoods and services, social and economic disruption, or environmental damage. They can be characterized by their magnitude or intensity, speed of onset, duration, and area of extent.

UNISDR. 2009. Terminology on Disaster Risk Reduction. Geneva, Switzerland

Onyango, M.A, Uwase M. 2017. Humanitarian Response to Complex Emergencies and Natural Disasters. International Encyclopedia of Public Health (Second Edition). 106-116

Forest fires

Forest fires are uncontrolled fires that occur in nature, often rendered more severe by climatic conditions. Long dry spells increase the risk of forest fires breaking out. Weather conditions, such as rain and wind, vegetation, the layout of the terrain as well as forest management practices are factors that have a huge bearing on the scale of forest fires.

European Commission. 2021. European Civil Protection and Humanitarian Aid Operations: Fact Sheet.

Mega-fires

Mega-fires are often extraordinary for their size, but they are more accurately defined by their impacts. Their complexity and their deep, long-lasting social, economic, and environmental consequences make them a serious situation, rather than, simply, a larger incident. Mega- fires are not always a single wildfire, but sometimes a grouping or “complex” of inter-acting multiple fires across a large geographic area. The costs, losses, and damages that come with them seem limited only by the depth of drought, the amount and extent of available fuel, and the extremes of weather.

FAO. 2011. Findings and Implications from a Coarse-Scale Global Assessment of Recent Mega- Fires.

Wildland–Urban Interface

The wildland-urban interface (WUI) is the area where wildland vegetation meets or mixes with humans and their development, including houses and infrastructure. The term is mainly used in the context of wildfire to define the potential risk that WUI fires pose to human settlement.

Johnston L., Blanchi R., Jappiot M. 2019. Wildland-Urban Interface. In: Encyclopedia of Wildfires and Wildland-Urban Interface (WUI) Fires. Manzello S. (eds). Springer

Resilience

The ability of a system, community or society exposed to hazards to resist, absorb, accommodate to and recover from the effects of a hazard in a timely and efficient manner, including through the preservation and restoration of its essential basic structures and functions. The resilience of a community in respect to potential hazard events is determined by the degree to which the community has the necessary resources and is capable of organizing itself both prior to and during times of need.

UNISDR. 2009. Terminology on Disaster Risk Reduction. Geneva, Switzerland

Corporate Social Responsibility

Corporate Social Responsibility (CSR) is a concept whereby companies integrate social and environmental concerns in their business operations and in their interaction with their stakeholders on a voluntary basis. Although there are many definitions around the term Corporate Social Responsibility (CSR), this seems to be rather adequate, as it includes the core dimensions of CSR: Social, Environmental, Economic, Stakeholder and Voluntariness.

Commission of the European Communities. 2001. Promoting a European Framework for Corporate Social Responsibilities. COM (2001)366/1 ﬁnal, Brussels.

Dahlsrud, A. 2008. How Corporate Social Responsibility is Deﬁned: An Analysis of 37 Deﬁnitions. Corporate Social Responsibility and Environmental Management. 15, 1–13

Sustainability reporting

A sustainability report (SR) is a way for a company to report the economic, environmental and social aspects of what it does and the way it governs itself. Today, Sustainability reporting has become a tool for managing change towards sustainable business practice that combines long-term profitability with ethical behaviour, social justice and environmental care.

Ashby, M. 2016. Chapter 6 - Corporate Sustainability and Materials. In: Materials and Sustainable Development. Butterworth-Heinemann. 101-110

1. Introduction

Natural disasters are devastating events that cause severe losses of human lives, properties, damages to the environment and to cultural heritage (European Commission,2021). During a period of ten years (1998-2017) almost $3 trillion and 1,3 million lives were lost due to climate- related disasters (UN, 2019). In the last decades, floods, heatwaves, hurricanes, wildfires and other catastrophic events that have taken place around the world, have been linked to extreme weather and climate events caused by climate change (European Commission,2021; Banholzer et al.,2014). The United Nations (UN) recognise climate change as ‘one of the greatest challenges of our time’ and have put their efforts on community resilience and preparedness (Goal 13 of the 2030 Agenda for Sustainable Development) in order to achieve a sustainable world (UN, 2015).

The influences of climate change along with human interventions have greatly affected forest fires and have turned them from physical events into disastrous big burns, known as megafires (Pyne 2007, Lavorel, 2006). A recent example are the 2019- 2020 Australian wildfires which burned an area of 12,6 million ha, almost as big as England and cost the life of citizens and of many threatened species (Wintle, 2020). The same year, during late summer, California experienced some of the biggest and deadliest fires in its history and two years earlier, in 2018, the state had experienced its deadliest megafire of all times, the Camp Fire (CAL FIRE, 2020a; CAL FIRE, 2020b). For Greece, 2018 was also a year of fatal megafires which cost the lives of 102 people (EU, 2019). CO2 emissions that may not be reabsorbed by new forests (Bowman et al., 2020), significantly large burnt areas, as well as losses of human lives and species, are some of the massive impacts of these forest fires that make them megafires.

Even though suggestions for effective wildfire management have always been made in order to eliminate the catastrophic consequences of megafires, their extreme and unpredicted behaviour make it difficult to set them under control. A conventional emergency management framework may not be able to overcome the challenges of such extreme events, therefore emergency planning needs a new and more integrated perspective in an effort to achieve resilience (Linnenluecke & Griffiths, 2013). With adaptation and mitigation measures, resilient communities and infrastructure can be built, thus the risks of the disasters can be reduced, crises can be faced and finally the goal for sustainability can be reached (UN, 2015).

Resilience is a difficult goal to achieve, but not unreachable. International cooperation and collaboration of public and private sector, in line with society, is a key element to overcoming the challenges of our times (Goal 17 of the 2030 Agenda for Sustainable Development, as in UN, 2015). Such an example is the contribution of private corporations, through philanthropic activities, when natural disasters strike. Corporate philanthropy, as part of the Corporate Social Responsibility (CSR) is a useful tool to raise resources towards the disaster relief of the affected communities (Hwang & Joo, 2021).

Nowadays, more and more private corporations act through CSR practices and take over a greater social and environmental role. Oriented towards sustainable development, modern corporations apply a sustainable management model, that aims to the integration of economic, along with social and environmental efficiency of the organisation (Schaltegger et al., 2006). These corporations are not only accountable for their financial performance, but also for their responsible behaviour towards their people, their communities and the environment they operate. Through integrated reporting, i.e. sustainability reporting (SR)

7 they communicate their CSR and disclose all the necessary information that reflect their responsible behaviour. The existence of responsible corporations is necessary to build a sustainable future, resilient and ready to face the challenges of our times.

Motivated by the disastrous wildfires that take place in these times, as well as the increasing need for corporations to contribute to disaster relief through CSR activities, the current study tries to understand the way that the private sector responds when megafires occur. It explores the reactions of private corporations during unexpected deadly events, like the 2018 megafires and their characteristics.

The megafires that burst in Greece and California, in 2018, were the deadliest of all time for both regions, causing damages not only to the environment, but most importantly to the affected communities. Moved by the severity of the two events, this research draws on the co-occurrence of two similar fire events in two different parts of the world, with different economies and background. With a comparative study, it explores the disaster response of the top Greek and Californian corporations.

In fulfilling its purpose, the research sets the following questions:

- Is there a country that has a better reputation, as far as philanthropy is concerned? If so, did the corporations in this country contribute to the 2018 megafires in a greatest extent that the other? With the literature review it derives that the U.S.A. have a much better relationship with philanthropy than the Greek, so the question becomes more clear: Are corporations in California that adopted CSR practices more than the Greek corporations?

- What kind information can be provided by the CSR activity of the Greek and Californian corporations? Did they respond to the 2018 megafires in the same way or are there different CSR patterns for the two regions of the study?

- What is the relationship between SR and CSR during the 2018 megafires in both regions? SR is becoming more and more important in these days, so how well-adopted to SR are the corporations that responded to wildfire relief efforts?

With the simultaneous study of the response of the corporations of the sample, these questions are answered in detail. The evidence from the research present how CSR was implemented in the disaster relief efforts and which were its characteristics. The findings add to the existing natural disasters- related and CSR related literature and give a new perspective for future research in the field as well as, for proper planning and management of similar situations.

The current study consists of six chapters, that will provide the basic knowledge to the reader, they will present the research questions and findings and finally, will give food for thought with the conclusions.

This chapter has made an introduction to what will follow to the next pages. Next, Chapter 2 gives to the reader all the necessary information around forest fires. Some general issues are

8 presented at the beggining of Chapter 2 and right after, the focus will be on the two studied regions: Greece and California. The profile of each country, their characteristics as well as a chronological retrospection of the main wildfire events will be presented. Especially for the 2018 megafires, there will be a detailed reference so that the reader will have a full view of the incidents that motivated this study.

Followed by Chapter 3, the theoretical framework is completed. In 3.1 the main theories of CSR are included. There is not only a mere presentation of the basic concepts of the theories, but also a review of the –related to natural disasters- literature where they have been implemented. While in 3.2 the concept of SR is introduced and later, in 3.2.1 and 3.2.2 the state of art for both Greece and California is explained.

Chapter 4 sets the framework of the research: how it is designed, what kind of data are collected, which are the research questions and also, how they are going to be answered. Thus, reference is made to the method, the variables and the statistical tools that have been used throw-out the research.

The consequent results of the research are shown in Chapter 5. After a general presentation of the basic characteristics of the sample, in each subsection, the three main research questions are answered. The main findings are explained in detail and the study’s remarks are discussed.

Finally, Chapter 6 sums up the key concepts and conclusions of this study, the suggestions that can be drawn from it as well as its limitations or chances for future considerations.

2 Forest Fires

Forest fire (or wildfires) is a process, within a global spectrum, that affects the Earth system. Vegetation composition and structure, land–atmosphere water and heat exchanges, biogeochemical cycles, atmospheric chemistry and composition, as well as human health and property, loss of animals and of their habitat are the ‘victims’ of forest fires (Li et al., 2013; Wintle et al., 2020). Although wildfires have played a significant role in shaping the global biome distribution and maintaining fire-prone communities (Bond & Keeley, 2005), the interaction between natural environment and human activities has made this process more complex and critical (Lavorel et al., 2007; Bond & Keeley, 2005).

The human influence in land use, with changes in vegetation cover, or the density of human infrastructures and the extent of human production are some of the important factors for fire activity (Lavorel et al., 2007). What stands out in literature is the growing Wildland- Urban Interface (WUI) areas, as housing expands in and near forested areas. The coexistence of forest ecosystems and humans constitute a peculiar form of community that needs a careful management system. Unfortunately, management efforts do not always succeed and when forest fires burst in these areas, the results are destructive or even deadly (Haynes et al., 2020; Kramer, 2019; Mitsopoulos et al., 2014).

The European Mediterranean region is ‘a highly populated area…characterised by an extensive WUI’ (San-Miguel-Ayanz et al., 2013). Despite the evacuation measures that countries take, wildfires in WUI areas of Southern Europe (Spain, Portugal, Greece) have been proved fatal in many cases. Similarly, in another part of the world, the United States, large- scale evacuations are implied in an effort to ameliorate the devastating results of wildfires. Over 30% the total line-of-duty deaths occur in California alone; and that is not something unexpected considering that the WUI problem is severe in the state (Haynes et al., 2020; Kramer, 2019).

Another fundamental factor for forest fires is climate and weather conditions. In contemporary literature, the increase of forest fires is highly liked to climate change. Prolonged droughts in addition to anomalously high temperatures, more and more often lead to extreme wildfires. Summer droughts are a determinant factor for the Greek forest fires. While in the case of California, extreme weather conditions in autumn too increases the likelihood of wildfires during that time (Goss et al., 2020; Dimitrakopoulos et al., 2011a; Westerling & Bryant, 2008).

The interaction of these factors, along with others that are necessary to start a fire, can arise large wildfires, known as megafires. It is not only the size of these fires that is severe, but also their impact. Throughout history, catastrophic wildfires have occurred across the globe. Canada, Australia, Brazil, Spain and Portugal are some of the areas that have been affected by megafires, mostly stasted due to human causes. (Ferreira-Leite, 2015; FAO, 2011). In year 2018, Greece as well as California (United States) experienced some of the worst megafires in modern history and these two cases are the main theme in this section.

2.1 Forest Fires in Greece

Greece is a Mediterranean country, located in the South-Eastern border of Europe. It occupies a total of 132.049 km2 (13,2 million ha), 27,5% ( 3,5 million ha) of which is covered in forests (https:www.statistics.gr; EEA, 2017). The country’s climate, starting from South to North, is classified in: xerothermomediterranean, thermomediterranean, mesomediterranean and submediterranean; characterized by dry summers and temperate and humid winters (Tselepidakis & Theocharatos, 1989). The heat waves, with an air temperature higher than 30o C and air humidity around 21-40%, facilitate most of the forest fires occur or spread during the summer (Dimitrakopoulos et al., 2011b).

Since ancient times, forest fires have been a usual phenomenon in the country. In Xanthopoulos (2015), we read that the first evidence of forest fires date back in 1500 B.C. and throughout the centuries there are numerous references of fires starting due to natural or man-made causes, as fires had also the utility of a war tool. In modern times, fires have turned into a ‘natural hazard’ for the Greek forests, which have been inadequately protected from human activities.

From the 1970s, social changes in the country have led to the formation of WUI zones and thus, fire problems occurred. Unplanned touristic development and urbanization enhanced the need of urban citizens for secondary ‘vacation’ houses close to the sea. The mix of wildland with rural settlements, along with the rising number of private cars using an extended forest road network and municipal waste disposal sites increased fire frequency and led to losses in ecosystems and biodiversity. (Xanthopoulos, 2015; IFFN, 2008b)

Figure 2.2.1 Burnt areas (a), Number of fires (b), Average fire size (c) in Greece Source: Forest Fires in Europe, Middle East and North Africa 2018 (EU, 2019)

The European Forest Fire Information System (EFFIS), the last twenty years systematically provides all the necessary information about forest fires and their effects. It releases annual reposts, since 2000, with data provided by the Greek Ministry of Environment and Energy. The burnt areas (a), the number of fires (b), as well as the average fire size (c) in Greece from 1980 to 2018, are shown in Figure 2.1.1, as it has been presented in the latest annual report of 2018.

Through the last four decades, large forest fires (> 1000 ha) are becoming more and more common, if we consider the number of fires relatively to the total burnt area. According to Dimitrakopoulos et al. (2011b), within a decade (1986-1995) 6% of the total fires burned 66% of the total burned area; while during the 1990- 2003 period, 84 large forest fires took place. Noticeably, in 2000, only seven fires were responsible for half of the total burned area. In 2007, only 1% of the recorded fires burnt 98,48% of the total burned area (Koutsias, 2012).

Not only do the fires burn significantly large areas in Greece, but they are also becoming more fatal. As in other Mediterranean countries, deadly fires occur under specific weather conditions (i.e. specific summer winds). The ‘unplanned and panicked evaluation’ of the burning area often leads to fatal decisions by civilians how are not properly educated or prepared for such emergency situations. Remarkably, in Greece almost half of the fatalities take place in WUI areas (Molina-Terren et al., 2019; Diakakis et al., 2016). In Ikaria island, 13 fatalities were recorded on 30 July 1993 and 10 major incidents around the country led to 78 deaths in 2007; in Artemida- Peloponnese only, 30 fatalities were recorded on 24 June 2007. Almost ten years later, on 23 July 2018 in Mati, Attica almost 100 people lost their life (Molina- Terren et al., 2019).

The 2007 wildfires have been of the worst natural disasters in the country’s recent history. Officially, a total area of 225.733,90 ha got burned by the 1.983 forest fires that burst around the country. While the EFFIS Rapid Damage Assessment (based on the analysis of MODIS satellite images) recorded an area of 271.516,38 ha the same year; the biggest number of burned area amongst European countries. These fires were also responsible for the death of 80 people, the victims were 69 civilians, 9 seasonal forest fire-fighters and 2 pilots (EU, 2008).

The ‘abnormally hot summer’ of 2007 (Founda and Giannakopoulos, 2009), with record high temperatures and its consequent heat waves, along with the drought of previous months and strong winds, contributed to the outbreak of some of the worst forest fires in Greece.

 On 27 June 2007, the fire on Parnis Mountain burned 2/3 of the National Park. After three weeks, this time in the east side of Athens, on mount Hymettus a fire would have threatened the civilians’ life if it hadn’t been instantly under control. And finally, on 16 August 2007, in the northeast side of Athens the fire that started in Penteli Mountain burned the regenerating pine forest and reached the capital’s suburbs due to the strong winds.  On 11 July 2007, 4 firefighters were the victims of the Doxato fire in Rethymnon, Crete.  Between 18 and 23 July 2007, in Corinth as well as 24 and 27 July 2007, in the north coast of Peloponnese (Aigialia) the fires burned more than 30.000 ha, destroyed more than 70 homes and killed 3 civilians. At the same time, fires at high elevation

mountains all over Greece were in progress, incommoding the firefighting mechanism’s work.  Between 24 and 27 August 2007, vast fires burned Peloponnese and Evia and led to the loss of 66 more lives, mainly in Ilia-Peloponnese. Houses and villages got evacuated, the ancient site of Olympia got in danger and international assistance was provided so that the country could get over this emergency state.

(source: IFFNa, 2008)

In southern Greece, Peloponnese lost totally around 180.000 ha, the majority of which were forests (55%) and agricultural areas (44%). Noticeably, 12,4% of the burned area were part of the Natura 2000 Network (Gitas et al., 2008). The wildfires moved from low-elevation fire- prone ecosystems to non-fire-prone ecosystems which had no previous experience of fires, making the disaster even bigger. What made these fires unprecedented was the burning pattern in the region, as the natural vegetation fuelled the fires with the synergy of the extreme weather conditions of the 2007 summer (Koutsias et al., 2012). The consequences were fatal not only for society, but they also led to serious ecological damage.

Figure 2.1.2 Burned areas and Natura 2000 sites affected by the 2007 fires in Peloponnese Source: Gitas et al., 2008

Many of the cases mentioned above, started due to human causes. For example, in Doxato, Crete a local shepherd started the fatal fire using an old agriculture technique to stimulate growth of new vegetation. In Artemida- Peloponnese, an old woman cooking in an open stove was the reason to start one of the biggest fires of 2007 (Xanthopoulos et al., 2009; IFFN, 2008a). In Greece, 95% of the fires are caused by human activity, mostly due to the negligence of people who are not educated or informed about fires (IFFN, 2008a).

The 2018 fires in Greece

Although the 2018 fire season started quietly, in 23 July 2018 two major incidents in Attica region led to the loss of more than 6000 ha of burned area and most importantly, the loss of 102 human lives (EU, 2019). World widely, Greece experienced one of the deadliest fires that summer, setting a new tragic record eleven years after the 2007 megafires.

The fires started in two different areas around Athens, under specific weather conditions that conducted to their quick spread. Strong westerly winds (i.e. a subtropical jet stream moving towards Greece), as well as some of the highest wind gusts of the decade were recorded on the 23rd of July. The temperature was high, with a maximum of 39o C and the humidity remained constantly under 30% - 20% (Lagouvardos et al. 2019). The combination of these three characteristics proved extremely dangerous.

Figure 2.1.3 The location of the 2018 Forest Fires in Attica Source: EU Copernicus, 2018

The first fire took place in Geraneia Mountain close to Kineta town (region 1 of Figure 2.1.3), in the western part of Attica. It was the larger of the two fires and resulted to more than 5000 ha of burned area (EU,2019). (Figure 2.1.4) Except for the ecological disaster, the fire affected the local community, as it spread through the highway road that crosses the area, destroyed many houses and ended up threatening an oil refinery in Agioi Theodoroi (Xanthopoulos & Athanasiou, 2019).

Figure 2.1.4 Pre- fire NDVI (left) and post- fire NDVI in KIneta Source: Kovacs, 2019

A second fire started - the same day- on Penteli Mountain, eastern Attica, and latter spread to the areas of Mati and Neos Voutzas (region 2 of Figure 2.1.3). Numerous fires had previously burned the area (1995, 1998, 2005, 2007 as mentioned earlier and 2009) destroying the local pine forests, causing damages to hundreds of buildings and leading to the death of one citizen (Efthimiou et al., 2020). However, the 2018 fire was the worst of all, in terms of human casualties. A total of 102 people lost their life (1 firefighter and 101 civilians) and 113 more were injured (EU, 2019). Moreover, 1500 buildings were totally destroyed and 1289 more got seriously damaged, hundreds of cars got burned and damages on infrastructure were severe (https://matiobserver.gr). (Figure 2.1.5) High erosion rates and significant damages in soil and vegetation were recorded after the fire, especially in the build- up areas (Efthimiou et al., 2020).

Figure 2.1.5 Damages in Mati, Attica Source: https://matiobserver.gr accessed 1/12/2020

A total area of 14,49 km2 (1449 ha) (Figure 2.1.6) got burnt within a region where tourists and locals were unsuspectingly spending their summer vacation. A lot of citizens living in the capital city of Athens visit the beaches near Mati and Neos Voutzas and many of them obtain secondary ‘vacation’ houses there. It is a region with a strong Wildland-Urban Interface (WUI) that lacks spatial planning and firewalls. According to Efthimiou et al. (2020) the land can be characterised as ‘Urban Forest’ because of the settlements built really close to the pine forest, sometimes within it. Many of the victims died due to the sudden and unplanned evacuation of the site, as they were trapped trying to escape by their cars or on foot (Xanthopoulos & Athanasiou, 2019; Smith et al., 2019).

Figure 2.1.6 Pre- fire NDVI (left) and post- fire NDVI in Mati Source: Kovacs, 2019

The lack of programming and management proved fatal during the 2018 fires, even though there had always been a discussion around the fire prevention practices and mitigation measures in Greece. Several authors have indicated the necessary actions that need to be taken in order to eliminate the country’s fire problem (Efthimiou et al., 2020; Smith et al., 2019; Xanthopoulos, 2015; IFFN, 2008b; Gitas et al., 2008). Legislation and regulations regarding the WUI urban planning as well as the waste disposal sites, proactive mechanisms (public education campaigns, biomass removal and use of fences or fire resistance materials) and finally in situ policy making using remote sensing applications are some proposals in order to build resilient communities.

Greek justice up until today hasn’t solved the case that cost the life of almost 100 people. The fire in Kineta seems that started by a short circuit, while a 65 years old man was arrested for starting the fire by burning sticks in Ntaou, Penteli. Although, charges are pressed meanly against the competent authorities for the mismanagement of the situation. (https://matiobserver.gr)

The 2018 wildfires in Attica are the worst natural disaster Greece has ever experienced in modern history.

2.2 Forest Fires in California (U.S.)

California is one of the fifty states of the United States of America, in the western borders of the country, bounded by the Pacific Ocean. It is the most populous state of the U.S.A. (www.census.gov) and occupies an area of almost 100 million acres (40,5 million ha), one third of which is forested (Brodie & Palmer, 2020). Its climate has also been characterized as Mediterranean (Quezel & Barbero, 1982) in the west, with three variations across the state and the peculiarity that most rains fall during winter time (Kauffman, 2003). Desert, Cool Interior, Highland and Steppe are the other climate types that are met in California due to its rich topography and contrasts, including coasts, valleys, slopes and mountains and finally, the Death Valley that drops below sea level (Kauffman, 2003).

Traditionally, the fire season starts in June and ends in October. However, within the last decade, there has been an extension of the fire season for two plus months. During 2009- 2018, the total burnt area in November and December had increased by four times, comparing to the previous three decades (Buechi et al., 2020). Climate change and severe droughts, in combination with the strong downslope winds, known as Santa Ana Winds or Diablo Winds are responsible for some the worst wildfires in the state’s resent history (Brewer & Clements, 2020; Nausar et al., 2018; Keeley et al., 2009).

Figure 2.2.1 Trends in location, size and number of fires by decade, in California Source: Buechi et al., 2020 (edited)

Except for the extension of fire season, an increase in the number of fires and the total burnt area has also been noticed. Over time, California’s fire problem has become even worse. During 2009-2018 proximately 2,87 million ha were burnt; which is more than twice the burnt area during the decade 1979-1988, as shown in Figure 2.2.1. The number of fires was not double though, during the same decades. According to Westerling et al. (2006), larger fires (> 400 ha) with longer duration (of two to five weeks) have become more common after the mid- 1980s.

Noticeably, the state’s largest fires, as recorded by the California Department of Forestry and Fire Protection (CAL FIRE), have taken place rather recently (2003-2020). With the only exceptions Marble Cone Fire in 1977, Laguna Fire 1970 and Matilija Fire in 1932 (Figure 2.2.2).

A/A DATE FIRE NAME HA A/A DATE FIRE NAME HA

1 August 2020 AUGUST COMPLEX 417.898 11 July 2007 ZACA 97.208 2 July 2018 MENDOCINO COMPLEX 185.800 12 July 2018 CARR 92.936 3 August 2020 SCU LIGHTNING COMPLEX 160.508 13 September 1932 MATILIJA 89.031 4 September 2020 CREEK FIRE 152.847 14 October 2007 WITCH 80.124 5 August 2020 LNU LIGHTNING COMPLEX 146.990 15 June 2008 KLAMATH THEATER COMPLEX 77.715 6 August 2020 NORTH COMPLEX 129.066 16 July 1977 MARBLE CONE 71.980 7 December 2017 THOMAS 114.078 17 September 1970 LAGUNA 70.992 8 October 2003 CEDAR 110.579 18 August 2020 SQF COMPLEX 68.952 110.038 9 August 2012 RUSH 19 June 2008 BASIN COMPLEX 65.890 (+ 17.671 NV) 10 August 2013 RIM 104.131 20 September 2006 DAY FIRE 65.843 Figure 2.2.2 Top 20 largest California wildfires Source: CAL FIRE, 2020a (edited)

As in Greece, 2007 was one of the worst California’s fire seasons. After the 2006-2007 drought, that year’s fires burned a total area of almost 400.000 ha and in Southern California only, 28 big fires (> 300 ha) were recorded.

 On July 4, the Zaca Fire, driven by offshore dry Santa Ana winds, burst in the country of Santa Barbara. It kept burning for 58 days and resulted to the loss of more than 97.000 ha. Due to the extremely low fuel moisture and the remoteness of the area that Zaca Fire spread, landscapes with least previous fire experience got affected, making an ecological impact.  Between 20 and 23 October several fires took place in San Diego, Los Angeles and San Bernandino. The combination of the autumn Santa Ana winds with unusual weather conditions (humidity, temperature) drove big fires that last until the end of the month. Witch Fire burnt an area of 80.124 ha and cost the life of two people, and due to Harris Fire, 36.717 ha of burnt area and 5 lives were lost.

(source: Keeley et al., 2009)

Ten years later, California experienced a fatal autumn. The North Bay fires of October 2007 as well as the southern California fires of December 2007 occurred after the warmest summer and autumn on record, coincident with the some of the strongest winds in the state’s history.

 Within a few hours, on the 9th October 2017, the destructive North Bay fires burnt a total area of around 100.000 ha and led to the loss of 44 lives and nearly 9.000 structures. The easterly Diablo winds and Northeast Foehn winds aggravated the situation and the results were deadly. The Tubbs Fire only, burned an area of 14.895 ha and killed 22 people. The Redwood Valley Fire, also burned 14.780 ha and led to the loss of 9 lives. And finally, due to the Atlas Fire an area of 20.892 ha and 6 people got lost (Figure 2.2.3).  In December 2017, during a prolonged period of Santa Ana winds, the Southern California fires hit the state. The largest fire, Thomas Fire destroyed a total area of 114.078 ha, 1063 structures and killed two people before it was contained in 12 January 2018.

(source: Nauslar et al., 2018)

A/A DATE FIRE NAME DEATHS A/A DATE FIRE NAME DEATHS

1 November 2018 CAMP FIRE 85 11 August 2008 IRON ALPS COMPLEX 10 2 October 1933 GRIFFITH PARK 29 12 October 2017 REDWOOD VALLEY 9 3 October 1991 TUNNEL- Oakland Hills 25 13 October 2007 HARRIS 8 4 October 2017 TUBBS 22 14 August 1968 CANYON 8 5 August 2020 NORTH COMPLEX 15 15 July 2018 CARR 8 6 October 2003 CEDAR 15 16 August 2020 LNU Lightning Complex 6 7 July 1953 RATTLESNAKE 15 17 October 2017 ATLAS 6 8 November 1966 LOOP 12 18 October 2003 OLD 6 9 October 1943 HAUSER CREEK 11 19 August 1959 DECKER 6 10 November 1956 INAJA 11 20 September 1955 HACIENDA 6 Figure 2.2.3 Top 20 deadliest California wildfires Source: CAL FIRE, 2020b (edited)

What makes these fires stand out, is not only their size but also the damages they cause, in infrastructures, houses, as well as human lives (Figure 2.2.3). During the 2007 Witch fire, 16% of the total burnt area was within WUI areas (Buechi et al., 2020). Moreover, the WUI area affected by the 2017 Tubbs Fire occupied 25% of the total area (USDA Forest Service, 2019); while the average WUI burnt area in California is about 5% of the total burnt area. What is noticed, is an increasing trend in the annual WUI burnt area over the years (Buechi et al., 2020) and sometimes, fire management policies (fuel treatments, forest thinning) are not enough to eliminate the damages that fires can cause to build-up areas (Keeley et al., 2009).

Recently, California got hit by even bigger megafires. In 2018, the state recorded its deadliest wildfire of all times, Camp Fire. While in 2020, the largest wildfire, August Complex wildfire burst in the state, along with North Complex and LNU Lightning Complex which were both large (Figure 2.2.2) and deadly incidents (Figure 2.2.3).

The 2018 fires in California

In 2018, California experienced another though fire season, culminating in the Camp Fire, the deadliest fire in the state’s history (CAL FIRE, 2020b). That year, totally 8.054 incidents led to the loss of 737.803 ha and almost a hundred lives (NIFC, 2018). The summer fires were among the largest fires in California, while the autumn fires were rather destructive. Some of the most important fires that took place in California during the 2018 fire season are shown below, in Figure 2.2.4:

STRUCTURES A/A DATE (2018) FIRE NAME HA FATALITIES DESTROYED 1 23 July- 30 August CARR FIRE 92.936 1.614 8 2 27 July- 19 September MENDOCINO COMPLEX FIRE 185.800 280 1 3 8 November- 25 November CAMP FIRE 62.053 18.804 85 4 8 November- 21 November WOOLSEY FIRE 39.234 1.643 3

Total: 380.024 22.341 97 Figure 2.2.4 Major Wildfires in California, 2018 Source: Wong et al., 2020 (edited)

The lack of rain, as well as the warmer than average temperatures, during the summer of 2018 in combination with dry fuels, increased that year’s fire danger (Brown et al., 2020), leading to Carr Fire and Mendocino Complex Fire in late July. These two incidents, alone, were responsible for almost 40% of the annual burnt area, destructions in structures and the loss of nine lives. They were fully contained after burning for over a month under extremely dangerous conditions, with biomass fuels generating their own tornado-like winds (Keeley & Syphard, 2020).

On the contrary, the November megafires can be better described as wind-dominated fire events (Keeley & Syphard, 2020). The downslope windstorm on 7 November 2018 through the morning of 9 November 2018 contributed to the creation of a high danger environment, where prolonged drought and minimum fuel moisture already existed (Brewer & Clements, 2019). Under these conditions, the chances for a fire to start and quickly spread were really high. And so it happened that on November 8th Camp Fire in Butte Country and Woolsey Fire in Ventura and Los Angeles Countries initiated.

The Camp Fire was the first out of the six fires (CAL FIRE, 2019) that started on the same day (November 8th) in California. At 6:33 AM fire burst on Pulga Road and Camp Creek Road near Jarbo Gap and quickly spread to the communities of Paradise and Concow as well as Butte Creek Canyon and Butte Valley (WERT, 2018). For the next days, it affected a wider area, including Cherokee, Yankee Hill and Park Hill (Figure 2.2.5) until it was fully contained on November 25th. During that time, it burned a total area of 62.053 ha and 18.804 structures were destroyed (Wong et al. 2020; CAL FIRE, 2019). The most important loss though, was the 85 fatalities that were recorded, setting a new deadly record in the state’s history.

Figure 2.2.5 Camp Fire progression map Source: CAL Fire (2020)

Local authorities, especially in the town of Paradise which is characterised as a very high fire hazard severity zone, had previously published information about fire mitigation practices. However, the lack of monitoring for compliance and the fact that no WUI- specific Building Code was adopted by California until 2008, led to severe damages in infrastructures and local communities (Schulze et al., 2020). The evacuation of 52.000 people (WERT, 2018) during the Camp Fire was not enough to protect the local community either. Evacuees moved to evacuation routes at the same time leading to congestions, while roadways were already threatened by flames; some people even tried to escape on foot (Wong et al., 2020). Some examples of the Camp Fire destructions are shown below, in Figure 2.2.6.

Figure 2.2.6 Camp Fire destructions (a) A still from FRONTLINE’s documentary “Fire in Paradise.” (Source: FORNTLINE magazine, 2019) (b) Damages in Paradise Intermediate School (Source: Schulze et al, 2020)

The same scenery was repeated during the Woolsey Fire, with 39.234 ha of burned area and a great impact on local communities. The destruction of 1.643 structures and the loss of 3 people could not be avoided, despite the evacuation of 250.000 residents (Wong et al., 2020; Cal Fire, 2019). Noticeably, the WUI area burnt by the Woolsey Fire occupied a percentage of 33% of the total burnt area and in Camp Fire another 26% of the burnt area was within a WUI area (Buechi et al., 2020). Human presence to high fire-risk areas proved fatal once again, in the 2018 California wildfires.

The need of protection measures and mitigation planning to be implemented by the state or individuals, in order to build resilient communities, is highlighted by the relevant literature (Brewer & Clements, 2020; Schulze et al., 2020; Keeley & Syphard, 2019). What also needs to be taken into consideration is the role that those who cause these tragic events play in reducing wildfire risk and restoring safety in damaged communities. Powerline ignitions are a common ignition source for wildfires and have burnt large areas through the years (Keeley & Syphard, 2018). As a result, major power companies have occasionally charged with involvement in catastrophic fires:

 Pacific Gas and Electric Company (PG&E) ‘pleaded guilty to 84 counts of involuntary manslaughter and one count of unlawfully starting’ Camp Fire (PG&E Press release, 2020).  And Southern California Edison (SCE) took responsibility for Woolsey Fire (SCE Press Release, 2021)

Both companies took over major projects, such as Community Wildfire Safety Program by PG&E and Wildfire Mitigation Plan by SCE in order to update their infrastructure, install technological equipment for fire detection and empower affected communities. Their actions, combined with proper programming from the authorities and the aid of individuals can make a step forward to build resilient communities.

3 Corporate Social Responsibility and Sustainability Reporting

3.1 Corporate Social Responsibility

In times of extreme events, like natural or man-made disasters, cooperation between public and private sector is necessary in order to manage the human, social, financial, economic and environment related impacts of the catastrophe (OECD, 2015). With the adoption of the United Nations’ (UN) 2030 Agenda, in 2015, global partnership is expressed through Goal 17 of the Sustainable Development Goals. Multi-stakeholder partnership plays a dominant role in achieving all the Goals and building resilient communities (UN, 2019). Consequently, in recent years, private funding towards the UN entities and their programmes is becoming more common (Seitz & Martens, 2017) and Corporate Social Responsibility (CSR) initiatives are linked to sustainable development issues (ElAlfy et al., 2020).

However, private sector’s contribution in social and environmental issues is not something new. Corporations have a social role, which they express through philanthropy, having fulfilled their economic, legal and ethical responsibilities and for over fifty years, CSR literature tries to explain this behaviour (Carroll, 1991). Corporate philanthropy is expressed through donations and grants (cash or in kind) to organisations, groups or beneficiaries that aim to disaster reduction (Twigg, 2001). The fundamental theories on CSR have been developed through the years and many studies are based on them in order to explain corporate giving during a disaster, some of them are presented in this section.

Stakeholder Theory

Stakeholder theory is one of the theories that interpret the role that corporations have in society. Edward Freeman, in 1984, was the first to link strategic management with the internal and external stakeholders of a corporation (Laplume et al., 2008). He pointed out that owners, customers, employees and suppliers (internal stakeholders) and governments, competitors, consumers, environmentalists, special interest groups and media (external stakeholders) (Figure 3.1.1) should be on the focus of organisations’ strategic planning (Freeman, 1984).

Later, Donaldson & Preston (1995) presented the three aspects of the stakeholder theory in order to ‘recommend the attitudes, structures and practises that…constitute a stakeholder management philosophy’. The descriptive aspect is about the corporate characteristics and behaviours. The instrumental aspect refers to the relationships and connections that are formed when management tries to fulfil its goals. Finally, the normative aspect, which is at the core of stakeholder theory, expresses the moral base of management.

Figure 3.1.1 Stakeholder Map Source: Freeman, 1984

Up until today, stakeholder literature was developed both in a descriptive/ managerial and a normative/ethical perspective (Fernando & Lawrence, 2014) In the first case, an attempt has been made in order for corporations to prioritise their stakeholders and focus their attention to the most salient ones (Parent & Deephouse, 2007; Mitchell et al., 1997). On the contrary, the studies that address the normative foundations of the theory have a philosophical character and raise debates or criticism (Stoney & Winstanley, 2001; Palmer, 1999; Hasnas, 1998; Campbell, 1997).

CSR of the corporations can be well explained through stakeholder theory (Frynas & Yamahaki, 2016; Brammer & Millington, 2004) as the main goal of CSR is to create value and fulfil the corporation’s responsibilities to its stakeholders (Freeman & Velamuri 2006). Recently, the theory has also been used to research CSR activities in times of natural disasters. The stakeholders’ expectations seem to affect corporate donations during massive events, like Hurricane Katrina or the Wenchuan Earthquake in China (Jia & Zhang, 2015; Muller & Kraussl, 2011). It has been noticed that the reputation that corporations have among their stakeholders can lead to responsible actions when disasters strike.

The different corporate responses to natural disasters have also been studied by McKnight & Linnenluecke (2016). Their study distinguishes ‘firm-centric’ from ‘community-centric’ postures, depending on the focus of the corporation’s CSR activity. When the focus is on key stakeholders in order to ensure the firm’s continuity, the CSR activities are ‘firm-centric’. Whereas when CSR aims at society’s resilience following a disaster, the posture is characterised as ‘community-centric’.

Finally, the study of the different networks and groups of stakeholders can lead to the understanding of the different patterns of CSR practices during disasters. Muller & Whiteman (2009), referring to stakeholder pressures, have found out that there is a ‘home-region’ and ‘local presence’ effect in CSR, according to which, corporations are more likely to respond to disasters that are closer to them. While they claim that ‘inter-regional differences’ exist in CSR during different natural disasters.

Institutional Theory

Institutional theory also matured around the ‘80s, with studies trying to explain why organisations tend to become similar under rationalised institutional rules and bureaucracy (Scott, 1987; DiMaggio & Powell, 1983; Meyer & Rowan, 1977). This homogenisation is known as isomorphism, and DiMaggio & Powell (1983) describe three different processes of isomorphism: coercive, mimetic and normative. Coercive isomorphism happens when organisations go through external pressures, such as legal and technical requirements, environmental regulations and pressures from resource-keepers. Mimetic isomorphism results when organisations poorly adopt to their environment so they copy successful models developed by other organisations. Finally, normative isomorphism takes place between organisations when they work with similar professionals, with similar education, skills and behaviour.

This sociological aspect of institutional theory is referred as ‘neo-institutional’ or ‘new organisational institutionalism’ in literature. Furthermore, the economic approach of institutionalism is expressed through the term ‘new institutional economics’ and last, the ‘comparative institutionalism’ explains both the social and economic differences in organisations across countries (Hotho & Pedersen, 2012). These three approaches have made a significant contribution to CSR literature in an effort to explain why and how organisations act responsibly (Jamali & Neville, 2011; Jackson & Apostolakou, 2010; Campbell, 2007) (Figure 3.1.2).

Figure 3.1.2 Institutional isomorphism as driver of CSR activities

Unlike stakeholder theory, institutional theory can explain the conditions (economic and institutional) under which corporations adopt responsible behaviours (Campbell, 2007). Different CSR actions take place within different sectors or across countries. Corporations within industries with a high impact on society, for example food companies, oil companies or Utilities, are more likely to adopt extensive CSR policies. By applying CSR, they legitimise their business practices and retain their reputation, according to Jackson & Apostolakou (2010). Moreover, corporations within liberal market economies, i.e. the U.S.A. or the U.K., are expected to engage with more extensive and explicit CSR activities. While corporations in

25 coordinated market economies, like European countries, act rather implicitly (Jackson & Apostolakou, 2010; Matten & Moon, 2008).

Although contemporary literature well explains CSR activity through institutional theory, the scheme of coordination is not always the case. The complexity of institutional pressures can be explained though another aspect of the theory: ‘decoupling’. Decoupling is the process during which organisations oppose their formal structure to adopt different practices (Dillard et al., 2004). Multinational corporations (MNCs), for instance, have a complex CSR behaviour as they act in different institutional environments. Their official CSR logic may differ from the ethical pressures in the host countries, leading to a ‘homogenization and heterogenization against the backdrop of globalization’ (Tan & Wang, 2011).

Decoupling isomorphism, as well as comparative institutionalism, are a tool for multi-national studies. They can explain CSR among counties with different environments and institutions. In cases where natural disasters are studied in an international spectrum, institutional theory can play a fundamental role.

Legitimacy Theory

Another fundamental theory of CSR literature, legitimacy theory, refers to the actions that a corporation takes in order to be ‘desirable, proper or appropriate within some socially constructed system of norms, values, beliefs and definitions’ (Suchman, 1995). Corporations are a part of the society, so their activities need to be in line with societal expectations. However, corporate performance does not always meet these expectations, leading to ‘legitimacy gaps’ (Wartick & Mahon, 1994; Sethi, 1979).

Changes in the external environment or changes in a firm’s performance- sometimes simultaneous changes in the external and internal environment- may arise corporate issues and create gaps. In order to close the gaps, corporations need to be adoptive and legitimise their performance with adequate resolutions (Wartick & Mahon, 1994).

When the legitimation process is under managerial control, there is a strategic aspect known as ‘strategic legitimacy’. Corporations get strategically organised by paying attention to external, non institutional, actors and specific groups of stakeholders. That is why there is a strong link between the two theories- legitimacy and stakeholder theory (Sonpar, 2010; Suchman, 1995). Whereas, when a corporation’s legitimation is focused on the external institutional pressures, literature refers to the ‘institutional aspect’, which is met with the institutional theory that was mentioned above (Sonpar, 2010; Suchman, 1995).

Corporate philanthropy is a tool of legitimation that corporations use. Through CSR activities, they try to fill the legitimacy gaps and improve their public image (Figure 3.1.3). It has been noticed that corporations with low (or bad) performance in specific areas, for example environmental issues, use CSR in an effort to bring a balance to their performance and gain reputation (Chen et al., 2008; Paten, 1992).

Figure 3.1.3 CSR as a tool of legitimacy

Additionally, studies that merge legitimacy with institutional theory focus on the behaviour of MNCs within different areas of the world. These studies go further than decoupling isomorphism and relate the different SCR policies of the MNCs with their try to legitimise their activities. With the approval of the parent company (sanctioned de-coupling), MNCs implement a local CSR, based on the host county’s needs. The drivers may not always be the institutional pressures in the host country, as the institutional theory states. It is more about gaining acceptance and building relationships with the local society (Beddewela, 2019; Rueede & Kreutzer, 2015).

In the field of corporate philanthropic disaster response, legitimacy is present with its strategic aspect. The few studies that refer to legitimacy, usually engage it with stakeholder or other theories. They recognise legitimacy as a strategic tool that corporations use in order to increase their reputation and visibility (Jia & Zhan, 2015; Gao et al., 2012).

Other Theories

Although stakeholder, institutional and legitimacy theories, that were reviewed above, are the main theories related to CSR, there is a wider range of literature in this field. Other significant theories are presented in brief in this section. They are worth to mention, as they usually interact and complement the three basic theories.

Resource Dependence Theory

The Resource Dependence Theory points out that corporation ‘as an open system, dependent on contingencies in the external environment’. From 1978, that the theory was first published, until recently there have been theoretical developments in order to explain the complexity of a corporation’s dependencies (Hillman et al., 2009).

In CSR literature, the theory has been used to explain that dependence on key resources drives CSR activities. The interaction with external groups, local communities and external pressures

27 have a positive effect on the firm’s social and environmental performance (Frynas & Yamahaki, 2016).

Signaling theory

The core concept in this theory is the information asymmetry between two parties: the signaler (the one who sends a signal) and the receiver (the one who gets and interprets it) (Connelly et al.,2011). Corporations make an effort to communicate their CSR practices to their stakeholders, within institutional environments. Whether or not this effort is successful, can be investigated with the help of signaling theory (Yu et al., 2017; Su et al., 2016; Perez, 2015)

The theory, up until recently, had an impact on management, psychology and anthropology (Karasek & Bryant, 2012). Nowadays it has been adopted in CSR studies as well as sustainability accounting and reporting studies (Zerbini, 2017; Hahn & Kuhnen, 2013), which will be discussed in the following section.

Integration of Theories

In recent years there has been a growing number of multi-theory CSR studies. Two or more of the theories mentioned above get combined in order to interpret the CSR behaviour of corporations. Their social and environmental role is examined through different lens and multi- level approach is used for an extensive analysis. In an effort to be more adequate and sufficient, CSR literature integrates theories and creates new frameworks for new researches (Frynas & Yamahaki, 2016; Fernando & Lawrence, 2014).

More specifically, some of the studies that examine CSR behaviours in times of natural disasters use multiple theories in an effort to explain corporate reactions and responses. By combining the main characteristics of CSR theories and integrating them, a wider range of questions can be answered by contemporary studies (Jia & Zhang, 2015; Muller & Whiteman 2009). In the current study, multiple aspects of SCR are going to be studied, based on the findings of the above theories, in an effort to understand CSR of wildfire affected regions.

3.2 Sustainability Reporting

The theoretical framework that was presented in the previous section is useful to understand Sustainability Reporting (SR) as well, since the theories of CSR and SR are common. Studies on Social and Environmental Accounting and Reporting have used the same theoretical background (stakeholder, institutional, legitimacy etc.) in an effort to examine the need of corporations to engage in new, more holistic forms of reporting (Gray et al., 2010; Jones M., 2010; Hahn & Kuhnen, 2013). This section here, concentrates on more practical issues, such as the structure and the framework of SR.

As long as the need for corporations to take over a more responsible social and environmental role raises nowadays, the integration of social, environmental and financial reporting seems necessary. SR is mainly expressed through the ‘triple bottom line’ model (Elkington, 1998); a model where economic, environmental as well as social information come together. According to Schaltegger et al. (2006), this sustainability triangle, as an effective tool for business management that promotes sustainable development, also needs to include the ‘interrelationships’ and explore the challenges of the three aspects. In their study they highlight that economic effectiveness, which is traditionally measured with profitability indicators, should go along with socio-effectiveness and eco-effectiveness, which express the corporation’s social and environmental performance (Figure 3.2.1).

Figure 3.2.1 The sustainability triangle Source: Schaltegger et al. (2006)

In order to track down and communicate the responsible behaviours of corporations, various initiatives have been developed through the years (Busco & Sofra, 2021) among which, the most popular is the Global Reporting Initiative (GRI) (KPMG, 2020; Landrum & Ohsowski, 2018; Alonso-Almeida et al., 2014; Levy et al., 2010). Since it was established, GRI’ s aim was to set the ‘first accountability mechanism’, a ‘global framework for sustainability reporting’ which

29 corporations would use (GRI, 2020). It actually did some major steps to achieve so, with developing reporting guidelines, later on, with the launch of International Integrated Reporting Framework, collaborating with the International Integrated Reporting Council (IIRC), in 2013, and finally with the GRI Standards for sustainability reporting, in 2016 (Busco & Sofra, 2021, GRI,2020). The GRI Standards are structured by three universal and three topic- specific standards, each with specific content over a wide range of sustainability concerns (GRI, 2021). In the figure bellow (Figure 3.2.2), the current structure and content of the GRI Standards is presented:

Figure 3.2.2 Structure and Topics of the GRI Standards

At the same time, efforts concentrate on constant update of the reporting standards as well as the global adoption of integrated reporting in the future. Collaboration among the relevant organisations is a key element to promote SR and help corporations adjust to the new state of art. According to IIRC’s latest report:

‘The work by five global corporate reporting organizations (CDP, CDSB, GRI, IIRC and SASB) has been welcomed by the IFRS Foundation, IOSCO, IFAC and the World Economic Forum as creating the building blocks for a comprehensive corporate reporting system with a single set of “sustainability” standards… the intended merger between the IIRC and SASB, will further enhance the case for a comprehensive global system and help to embed integrated thinking and reporting principles and concepts in line with our strategy.’

(Source: IIRC, 2021)

Up until today, the world’s largest corporations have well adopted SR. Based on the KPMG’s (2020) Survey of Sustainability Reporting, the majority of the corporations (80%) of the sample -of top N100 companies by revenue- use SR. There has been an increase of 56 percentage points the last twenty years, taking into consideration that in 1999, only 24% reported on sustainability matters. Among the countries with the higher SR rates, the U.S.A. score with a percentage of 98%, while Greece is one of the lowest performers with a percentage of 59%. In

30 the next sections, a more extended reference for the two countries will be made and the role of SR will be further explored.

3.2.1 Sustainability Reporting in Greece

CSR was brought forward on the Greek scene around 2000 and became popular after 2007- 2008; at that time the Greek Business Council for Sustainable Development (BCSD) launched and the Hellenic CSR Network would count more than a hundred members. The voluntary character of non-financial reporting in Greece and the Greek capital market’s profile kept the country’s CSR performance (and reporting) at low levels, nevertheless a promising and increasing trend towards CSR adoption was spotted by the contemporary literature (Skouloudis et al., 2011).

Veritably, a study that investigated the CSR of private corporations during the 2007 wildfires in Greece found out that 20,7% (59 corporations) of the sample acted responsibly and proceeded to in- kind or grant donations in a disaster relief effort. Among the responders to the disaster, a percentage of 78% used some kind of SR, while the help from domestic firms proved significant (Papaspyropoulos et al., 2009).

The next years were rather fruitful for the development of SR, despite the economic crisis that the country faced. Metaxas & Tsavdaridou (2013) revealed that the Greek corporations were well adopted to GRI guidelines or other forms of standardisation during the crisis period and that their CSR activities headed towards their employees, local communities, as well as towards the environment. After the implementations of the Memoranda of Economic and Financial Policies -which put pressure on the private sector to take over a more responsible role on economic development- an even better performance of the Greek corporations was spotted with societal issues taking over their CSR projects (Papacharalampous et al., 2019).

It is a fact that SR is gradually gaining ground within the European countries. With the Non- Financial Reporting Directive (NFRD), in 2014, the EU has required large listed companies (over 500 employees) and public-interest entities to disclose social and environmental information. Later, in 2017, the European Commission published the guidelines on non-financial reporting, where the framework for sustainability reporting was set. Up until now, through public debate and suggestions the EU is adopting to the new challenges aiming to the introduction of mandatory sustainability reporting standards (European Commission, 2021).

These legislative and institutional forces seem to have a positive effect on the countries non- financial accountability (Mion et al., 2020). At the same time, the Greek private corporations have made significant steps, but their CSR performance remains mediocre, based on the GRI reporting principles. The current belief is that even more needs to be done in an effort to achieve a better ‘corporate and accountability performance’ (Vouros et al., 2020).

Figure 3.2.1.1 KPMG’s SR rate for Greece

In Figure 3.2.1.1 it is made clear that the condition of SR in the country has ameliorated through the years. From 2% in 2002, the top Greek corporations increased their SR performance by 57 points in 2020. The Greek percentage though confirms the above statements about its moderate performances, considering that Europe in general has a SR rate of 77% in KPMG’s latest survey (2020).

3.2.2 Sustainability Reporting in California

On the other hand, North America’s top corporations use SR in a rate of 95%, based on the same survey (KPMG, 2020). The U.S.A., alone, is at the list with the top SR performers, with its SR rate having climbed from 36% to 98% within almost twenty years (Figure 3.2.2.1).

Figure 3.2.2.1 KPMG’s SR rate for the USA

In the U.S.A., reporting on social, environmental and governance (ESG) 1 issues is gaining ground, as investor pressures are raising. Even though SR is of great importance, up until today it remains voluntarily and without a standardised framework (Clarkin et al., 2020). The existing framework concerning non-financial reporting, was initially issued in 2010. With the 2010 Climate Change Guidance, the Securities and Exchange Commission (SEC or Commission) had set an integrated disclosure system focused on environmental matters. Currently, the Commission is intensifying its efforts to adopt climate change disclosures and to adequately set reporting standards. (SEC, 2021).

The state of California- with an excellent CSR performance at federal level- is a global leader in ‘green’ technologies, sustainability policies and, through the years, its private sector has adopted responsible environmental and social behaviours (PRI & CLEE, 2020). The 2020 California roadmap highlights, that:

‘California has provided leadership in sustainability through stewardship of natural resources, protecting the rights of residents, providing and expanding health, education and social welfare programs for those with lower incomes, seeking to address the needs of all communities, holding corporations accountable, and taking action designed to limit climate change.’

(Source: PRI & CLEE, 2020)

It is no surprise that the state immediately embraced the Commission’s initiative for the development of Climate Change Disclosures, with the launch of the Climate-Related Risk Disclosure Advisory Group (Governor’s Office of Planning and Research, 2021). Having experienced the climate change affects itself, California is now putting its efforts on the application of climate related disclosure standards and practices, proving its leading role in sustainability matters.

1 ESG is commonly used as a term among the American corporations and literature, to express integrated reporting. For the purposes of this study integrated reporting is (and will be) referred as SR.

4 Research Process

4.1 Research Design

During the last decades Greece and California have experienced some of the most dangerous wildfires worldwide. The year 2018 was devastating, as for both of them, the deadliest wildfires in their history were recorded. Extreme fire activity in inhabited areas, led to 102 fatalities during the Mati wildfire in Greece, plus 85 fatalities during Camp Fire in California. Losses in vegetation and infrastructure damages added to the tragic events, demanding urgent succour from authorities and volunteers as well as cooperation between public and private sector.

FOREST FIRE EVENT PLACE DATE FATALITIES STRUCTURES DESTROYED

Mati wildfire Attica, Greece July 2018 102 1.500 (within 1.449 ha) Camp Fire California, USA November 2018 85 18.804 (within 62.053 ha) Figure 4.1.1 The Forest Fire Events of the study

This coincidence of two deadly megafires (Figure 4.1.1) at the same time in two different parts of the world is an opportunity to study the disaster response of private corporations and enrich contemporary CSR literature. While a part of literature has previously studied natural disasters with international interest, such as the 2004 Tsunami and Hurricane Katrina (Muller& Kraussl, 2011; Muller& Whiteman, 2009; Patten, 2008) or domestic disasters such as the Chinese earthquakes (Jia&Zhang, 2015; Gao et al., 2012; Zhang et al. 2010), little is known for CSR activities in times of wildfires.

Up until today, studies have concentrated on wildfire prone communities affected by a single fire event (Cardigos, 2019; Papaspyropoulos et al., 2009), providing information related to the specific incident. The simultaneous study of the two deadly megafires is covering a broader spectrum, while the choice of two areas in different continents (America and Europe) can give an international aspect in the existing literature. The data collected in the study refer to the year 2018 and more specifically the Mati wildfire in Greece and Camp Fire in California.

The sample of corporations comes from the two affected areas, given that the wildfires did not cross their country’s (or state’s) borders and can be rather characterised as a ‘domestic natural disaster’ (Johnson et al., 2011). In addition to Muller & Whiteman (2009), whose findings show that proximate to the affected regions corporations, involve more with CSR activities, the focus of the current study is on the Greek and Californian corporations that responded to the two events.

Fortune 100 (or Fortune 500) lists have proven to be a useful tool for CSR studies in times of natural disasters (Johnson et al., 2011; Muller & Kraussl, 2011; Muller & Whiteman, 2009), so this approach to sample collection has been used here too. The data of the study have been obtained from a total of 200 corporations; 100 Greek and 100 Californian that were, according to Fortune, at the top of the list.

Fortune magazine yearly publishes a list with the top ranked private corporations based on their total revenues. Every year, the published Fortune list uses figures that refer to the previous fiscal year. For example, the 2019 Fortune list’s figures are for the year ended Dec. 31, 2018. As long as the reference year of this study is the year 2018, the corporations that took action during that period are shown in the 2019 Fortune list.

The Greek corporations are included in the 2019 published Greek Fortune 100 list, while, it should be noted that, the American corporations from all the United States are included in the Fortune 500 list. For the purposes of the study, only the top 100 corporations located in the state of California were chosen out of the wider Fortune 500 list, concluding to a short list of the 2019 Fortune 100 Californian corporations.

Having set the time period, the incidents that are going to be studied as well as the corporations which are under the study’s focus, the next step is to specify the questions that are going to be answered through the current research.

4.2 Conceptual Development

4.2.1 CSR philanthropic activity in Greece VS California

The first question that this study poses is, whether -and to which extend- corporations in the affected by the 2018 wildfires areas acted through philanthropy. Based on institutional theory, liberal market economies engage differently in CSR activities than coordinated market economies (Jackson & Apostolakou, 2010; Matten & Moon, 2008). U.S.A.’s and thus California’s economy, is an example of liberal market economies, which perform an extensive and explicit CSR. On the contrary, the Greek economy is one of the E.U.’s coordinated market economies whose CSR activities are more implicit.

Additional to these statements are the results of the CAF World Giving Index, that ranks countries according to their citizens’ performance in three levels i) help to strangers ii) donations to charity and iii) volunteering to organisations. Even though corporate charitable actions are not directly counted, the Index’s results can supplementary be used to the study of philanthropic giving. Charities Aid Foundation (CAF) published its latest CAF World Giving Index report (CAF, 2019) with aggregate data for each of the 126 countries it surveyed within a period of 10 years (2009-2018). The U.S.A. are ranked 1st as the world’s most generous country. Whereas Greece comes at the bottom of CAF’s World Giving Index list (125th of the 126 countries) with a poor performance.

The two regions seem to adopt totally differently in CSR and philanthropic giving in general. American corporations are among the top CSR performers, contrary to the European- and specifically Greek- corporations. Hence, an interesting question that arises is the following:

Q1: Are corporations in California that adopted CSR practices more than the Greek corporations?

4.2.2 CSR patterns of the Greek and Californian corporations

Several authors have attempted to describe and categorise the CSR practices of the corporations when catastrophic events hit. The Benfield Greig Hazard Research Centre (Twigg, 2001) has comprehensively documented the different ways that the private sector manages natural disasters. Collaborations with NGOs, sponsorships, informational programmes and volunteering are some examples of CSR for disaster reduction. Succeeding studies have put CSR activities into categories based on the different types of disasters. McKnight & Linnenluecke (2019) distinguish ‘reactive’ from ‘anticipatory’ CSR, while in their prior research (McKnight & Linnenluecke, 2016) they refer to ‘firm- centric’ and ‘community- centric’ CSR activities. Last but not least, Johnson’s et al. (2011) have written down the CSR activities that are taken during international or domestic natural disasters as a tool of short-term relief effort or a long-term initiative.

Even though much is known for the CSR practices during natural disasters, there are not enough comparative studies to show how countries across the world adopt them. Muller & Whiteman (2009) have explored corporate contributions in a global scale and they have fund that different CSR takes place within different regions. They refer to ‘inter-regional differences’ to express the various reactions of corporations across different countries, but what exactly is that?

In an effort to enhance the understanding of various CSR practices across the world, the next question aims to explore the different CSR patterns between the two regions, by comparing their reactions to the 2018 megafires.

Q2: Are there different CSR patterns for the two regions of the study?

4.2.3 Sustainability Reporting of the CSR performers

The final research question broaches the subject of reporting and aims to explore its relationship with corporate disaster response. Other studies have tried to explain SR and specifically GRI reporting, but with mixed results. The empirical data of this research will show if corporations with responsible behaviour (CSR activities), during the 2018 megafires in Greece and California, adopted SR disclosures.

Integrated reporting seems to have a positive effect on a corporation’s performance, however if someone focuses on the sub-components of the reporting (environmental, social, corporate governance) or on different sectors, the results may vary (Bahaaeddin & Hamdan, 2020; Buallay, 2020; Buallay, 2019). For GRI reporting specifically, Lee & Maxfield (2015) have found a strong positive impact on corporate social behaviour pointing out its comprehensive and informational character. On the contrary, Isaksson & Steimle (2008) present a more critical view, querying whether the GRI framework is sufficient enough as a tool of reporting.

SR is a topic that needs to be further researched by the literature and with this last research question this study tries to do so. As for corporate giving during natural disasters, little is known about SR of the corporations. Are the CSR responders also sustainability reporters or is SR separable from the philanthropic activity of the corporations? Here, what will be

36 researched is the extent to which corporations that actually took action in 2018 were familiar with SR- or GRI- reporting:

Q3: What is the relationship between SR and CSR during the 2018 megafires in both regions?

4.3 Research Method

The research was conducted two years after the deadly wildfires, more specifically the data collection took place on December 2020 till January 2021. By that time, corporations which use Sustainability Reporting had already published their reports referring to the year 2018. Via the corporates’ websites, the reports were retrieved in order to find any information related to CSR activities during the 2018 megafires in Greece and California. In cases there was no reporting available, the research was done though the corporations’ press releases or with the help of internet search using the Google search engine. The same process was performed for all the 200 corporations of the sample.

A useful data source has been the U.S. Chamber of Commerce Foundation, which has published a list of the corporations that provided aid to the 2018 California wildfires. As well as the matiobserver.gr in Greece, a website whose aim is to provide any information related to the 2018 megafire in Mati.

Thereafter, the classification of data was achieved by using a content analysis. Content analysis is a coding method which transforms raw data into a standardised form, putting them into the conceptual framework of the study (Babbie, 2016). It has been previously used in CSR studies, especially when corporate reporting is surveyed (Landrum & Ohsowski, 2018; Johnson et al., 2011; Vuontisjarvi, 2006; Idowu & Towler; 2004). It has been chosen, here, in an effort to code the data retrieved from the corporations’ websites or other sites and be able to proceed to further analysis.

For the first question of the research to be answered, a binary variable (0,1) was used. Each time a corporation was recorded to have performed any kind of SCR activity during the 2018 megafires the variable DONATION (Figure 4.3.1) would be equal to 1.

Variable Values 0: if NO CSR was performed DONATION 1: if SCR existed Figure 4.3.1 The first variable refers to the first research question

In order to find out the existence of CSR patterns, every CSR activity of the corporations would be categorised according to the Johnson’s et al. (2011) model, which recognises the following (Figure 4.3.2) CSR activities for domestic, natural disasters:

Immediate Direct cash donations Partnerships/cash donations to NGOs (e.g. American Red Cross) In-kind donations (goods, services and resources) Company cash grants Employee cash donations/contributions Pledges, challenge grants and foundation matched funds Employee volunteer activities Deployment of employees Customer cash donations Long Term Working with local leaders, community organizations government officials Creation of emergency operations center Financial investments in disaster-struck communities Corporate grants Infrastructure modifications (e.g. communications and computers) Stakeholder educational and training programs Long term funding of non-profit organizations for disaster initiatives Figure 4.3.2 CSR activities for Domestic Natural Disasters Source: Johnson et al. (2011)

With some modifications, add-ins* and improvements, in accordance with this study’s data characteristics, the categories were used as the next variables (Figure 4.3.3). Each category was equivalent to a variable; consequently, 9 variables referred to immediate CSR activities and more 5 variables were available to record long-term CSR activities.

All of them were binary variables that would be only noted =1, in case this kind of CSR activity was observed in the sample. For example, for a corporation that had performed some kind of CSR, including cash donation and employees volunteering, only the two corresponding variables would be noted =1.

Variable Values Direct cash donations, cash grants and funds

Partnerships/cash donations to NGOs

In-kind donations (goods, services and resources)

Employees and customers in-kind donations * Pledges, challenge grants and foundation matched funds Employee cash donations/contributions

Immediate CSR activities CSR Immediate Employee volunteer activities and deployment

Customer cash donations 0: absence, 1: existence

Customer emergency support * Infrastructure modifications and creation of emergency operations center Financial investments and corporate grants in disaster-struck communities Long term funding of non-profit organizations for disaster initiatives Stakeholder educational and training programs

Long-term CSR activities CSR Long-term Working with local leaders, community organizations, government officials Figure 4.3.3 The variables that refer to the second research question

Finally, the variable REPORTING (Figure 4.3.4) is a polynomial variable which examines the absence of SR (=0), existence of SR (=1), or more specifically the existence of GRI SR (=GRI). This last variable was used in the effort to answer the last question of this research, on the relationship of CSR and SR when the 2018 megafires hit the two regions.

Variable Values 0: if NO integrated reporting exised REPORTING 1: if SR existed GRI: if GRI reporting existed Figure 4.3.4 The last variable refers to the third research question

After the data had been collected into spreadsheets, a database was formed and the statistical analysis was done. In order to get all the necessary information as well as to answer the research questions, descriptive statistics were used.

5. Findings and Discussion

5.1 General Data Characteristics

Before proceeding to answering the research questions, some general information about the sample will be presented here. These data were collected during the research progress and aim to a give a more holistic view of the corporations of the sample. In that way, the reader can have a better picture of the business environment of the two regions: what is the size of the corporations that are going to be studied, in which sector do they operate, and finally to what extent do they use SR to communicate their non-financial performance?

As it has been previously mentioned, the top 100 Greek and top 100 Californian of Fortune list corporations were examined for their CSR activity. As far as the last are concerned, it is worth mentioning that they not only are the top corporations in California, but also in the rest of the world. The Californian sample incudes some well-known multinational corporations, like Apple, Alphabet, Facebook, Wells Fargo, PayPal or Tesla. This is the reason why their size (by looking at their revenues) is much larger, comparing to the size of the Greek corporations.

The largest Californian corporation has the maximum revenue of the sample ($265.595 mil.) and in the 31st position of California’s sample the revenues drop around $12.500 mil.. In Greece, the first corporation of the Fortune 100 list has a revenue of $12.016,07 mil., while the last is also the smallest corporation of the whole sample with a minimum price of $219,94 mil.. Generally speaking, the Californian corporations count an average of $17.560,56 mil. and the Greek corporations have an average of $1.073,77 mil., with the mean for both regions being formed at $9.317,17 mil. (Figure 5.1.1.).

Maximum Minimum Mean GREECE 12.016,07 219,94 1.073,77 REVENUES CALIFORNIA (US) 265.595,00 2.505,70 17.560,56 ($M) SAMPLE (GR & CA) 265.595,00 219,94 9.317,17 Figure 5.1.1 Size of the corporations of the sample (by revenues)

Another characteristic of the sample is the different distribution within the industrial sectors the corporations operate. Most corporations of the sample are in the technological sector, (41 in total), of which 35 are Californian and the rest 6 are Greek. The majority of the Greek corporations are in retail and logistics (18 in total), and more 8 corporations operate in this industry in California. Next in the list comes the construction and real-estate industry, followed by the banking, insurance and finance industry and pharmaceuticals, where both Greece and California have similar activity.

Although the Greek corporations of the sample are also active in the fields of energy as well as food, drink and tobacco, the Californian sample is less active in these industries, bringing them close to the bottom of the list. Finally, only 6 corporations of both countries have activity in the automotive and engineering sector, making it the least popular industry. In the following figure (Figure 5.1.2) the distribution of the sample among the industries is shown:

Figure 5.1.2 Industries the sample operates in

One more difference can be spotted in the ‘Other’ category, where corporations with various activities are listed. Some of them operate in miscellaneous fields, however it is observed that in Greece, most of the corporations operate in the tourism sector and in California, entertainment seems to take over a big part of this category.

The last characteristic of the sample that is presented here, is about SR and whether the corporations that are studied have well adopted non- financial reporting. The presence of SR proved of significant importance for this research, as it includes all the necessary information about the social and environmental activity of the sample. In that way, CSR activities that took place during the two megafires could be easily spotted and reviewed. It is encouraging that over 70% of the sample use SR, with 69 Greek and 76 Californian corporations reporting on sustainability matters (Figure 5.1.3a).

No Yes (0) (1) GREECE 31 69 REPORTING CALIFORNIA (US) 24 76 SAMPLE (GR & CA) 55 145 (27,5%) (72,5%) Figure 5.1.3a SR of the sample

These 145 corporations use multiple reporting techniques: the GRI Standards and ISO Standards, the SDGs (the UN 17 goals for sustainability) and the Ten Principles of the UN Global Compact are some examples. Others measure their performance with Key Performance Indicators (KPIs) or simply by writing down their philanthropic activity into an

41 integrated report. Remarkably, the most popular practice of SR is by using the GRI Standards. A percentage of 76,5% of the corporations that report on sustainability, use the GRI standardisation system to do so (Figure 5.1.3b).

No Yes Yes- GRI (0) (1) (GRI) GREECE 31 9 60 REPORTING 1 CALIFORNIA (US) 24 25 51 SAMPLE (GR & CA) 55 34 111 (27,5%) (17%) (55,5%) (23,5%) (76,5%) Figure 5.1.3b SR of the sample (GRI model)

The discrimination between corporations that generally use integrated reporting and those that use GRI Standards to their SR, composes an extended model. This new model gives a rather detailed view of the sample and will be included in the tests of this study, in order to achieve a better understanding of the SR.

5.2 CSR philanthropic activity in Greece VS California: Answering Q1

The philanthropic activity of both Greek and Californian corporations was severe, in an effort to provide relief to the affected by the 2018 deadly wildfires communities. A great movement of the top corporations, contrary to the expected results, was noticed for both regions. As it has already been mentioned, American corporations -and Americans in general- have an excellent performance in terms of philanthropic giving, whereas European countries and Greece in particular has shown a rather irresponsible behaviour.

With a glance at Figure 5.2.1, it is made clear that there is no difference between the Greek and Californian corporations that adopted any kind of philanthropy, during the two megafires. In Greece, 42 corporations out of the 100 of the sample contributed to the disaster relief efforts, which is one more than the total (41) Californian corporations that acted responsibly.

The results of this study, do not only reject the assumption that Californian corporations would donate more for the Camp Fire relief effort, but also they prove that the Greek private sector is equally (if not more) active when it comes to a disaster of the same impact, like the Mati wildfire.

No Yes (0) (1) GREECE 58 42 DONATION CALIFORNIA (US) 59 41 Figure 5.2.1 CSR philanthropic activity of the Greek and Californian corporations

It is worth mentioning that for the Greek sample, the original number of donations was 51 (10 more than California). However, there were 9 philanthropic activities, which were not communicated by the ‘donor’ corporation, but were only written down by the municipalities of Marathon and Rafina that received the donation. These were excluded from the research process due to lack of evidence that the corporation intentionally proceeded to them. The possible explanations would be a) that the local branch stores proceeded to CSR independently, which enhances the stakeholder theory belief that proximity to the disaster plays a significant role to the donation, and b) the corporation underestimated the extent of the donation and did not communicate it properly.

In general, almost 40% of the corporations of the sample proceeded to CSR practices in a disaster relief effort, when the 2018 megafires burst. The amount of CSR performers in California was the same as the amount of the Greek CSR performers and no significant difference was observed.

5.3 CSR patterns of the Greek and Californian corporations: Answering Q2

The number of corporations that acted responsibly during the 2018 megafires in Greece and California is almost the same for the two regions, but did the Greek and Californian corporations responded in the same way? The existence of different corporate giving patterns is going to be examined in this section.

The CSR activities in times of natural disasters are already known, what is not known is how the corporations in two different areas adopt them. Using the categories that have been spotted by previous literature and with the addition of two more categories that derived from the content analysis of this study, in order to answer the second research question there were used nine (9) immediate and five (5) long term types of CSR.

Starting with the immediate CSR activities of the Greek and American corporations, Figure 5.3.1 summarises the results of the study. At the top of the list are the most popular CSR practises descending to the less popular categories.

Immediate CSR activities Greek corporations % Californian corporations % In-kind donations (goods, services and resources) 26 43% Partnerships/cash donations to NGOs 21 21% Pledges, challenge grants and foundation Partnerships/cash donations to NGOs 9 15% 18 18% matched funds Direct cash donations, cash grants and funds 7 11% Employee cash donations/contributions 17 17% Employee volunteer activities and deployment 6 10% Direct cash donations, cash grants and funds 12 12% Customer emergency support * 6 10% In-kind donations (goods, services and resources) 12 12% Employees and customers in-kind donations * 5 8% Employee volunteer activities and deployment 10 10% Employee cash donations/contributions 1 2% Customer cash donations 5 5% Customer cash donations 1 2% Customer emergency support * 4 4% Pledges, challenge grants and foundation 0 0% Employees and customers in-kind donations * 1 1% matched funds Figure 5.3.1 Immediate CSR activities of the Greek and Californian corporations

The 83 corporations that donated during the 2018 megafires did not use one only kind of CSR. Most of them (57 out of the 83) used a combination of CSR activities, by applying multiple donations that can be spotted in 2 till 5 different categories. That is why the aggregate of the CSR practice is bigger than the total number of CSR performers.

The Greek private sector basically acted through in-kind donations (products, services, resources) either they came from the corporations’ production or they were bought, and later offered, to the affected communities. A percentage of 15% of the donor-corporations co- operated with NGO’s: The Greek Red Cross, Apostoli (the NGO of the Holy Archdiocese of Athens), the Hellenic Rescue Team and other voluntary associations were among those that rushed to assistance at the time of the disaster. Following, 11% of the Greek corporations preferred direct funding and another 10% refer to voluntary action taken by their employees, such as blood donations, contribution to the collection and distribution of goods and voluntary services aiming to the regeneration of burnt areas.

During the research process, what stood out was the statement that some corporations provided support (mainly free services) only to their customers who were affected by the wildfires. Moreover, others reported on in-kind donations that were not provided by the corporations but from their employees or customers. The Johnson’s et al. (2011) categories did not include such CSR activities, as a result, two extra categories were used to separate these donations from other types of CSR. ‘Customer emergency support’ took over a 10% of the Greek CSR activities followed by an 8% of corporations that refer to ‘employees and customers in-kind donations’.

Only one (2%) of the Greek corporations of the sample reported on cash donations from its employees and one more (2%) on cash donations from its customers. Whereas, there was no reference to ‘pledges, challenge grants and foundation matched funds’. Remarkably, all Greek corporation proceeded to CSR independently, without the aim of any foundation.

On the contrary, in California, foundations are linked to the CSR activities of the corporations. Out of the 41 corporations of the sample which donated, 14 refer to CSR actions taken by the related to the firm foundation. Consequently, more complex fundraising techniques are preferred. ‘Pledges, challenge grants and foundation matched funds’ are the second most noted CSR activity (18% use this type of CSR) among the Californian corporations, after ‘partnerships and cash donations to NGO’s’ that take over the first place of the list, with a percentage of 21%.

It is common among the Californian corporations or/and their foundations to match employee contributions to provide disaster relief and employees embrace such efforts. According to the findings of the current study, 17% of the donor-corporations report on ‘employee cash donations and contributions’. A typical example of the Californian contributions is the one of the Amgen, whose employees ‘made donations through the Amgen Disaster Relief program…which were also matched by the Amgen Foundation’s Disaster Relief Matching Gifts program’.

Right after come the direct funding techniques (cash donations, grants and funds) with a percentage of 12%, in- kind donations with the same percentage (12%) and employee volunteering and deployment with a percentage of 10%. While the least popular CSR activities among the Californian corporations are: ‘customer cash donations’ (5%), ‘customer emergency support’ (4%) and ‘employees and customers in-kind donations’ (1%).

At this point, it is worth mentioning that, among these immediate CSR activities there are some initiatives that took place some months after the deadly incidents. Their aim was the reintegration of the survivors into daily life and their support, without having though a long term affect. For example, Tetra Tech in California (Plaisio and Retail World in Greece) gave away school backpacks when students went back to school, and Mega Disposables S.A. (in Greece) provided free baby diapers for two years, to cover the needs of the affected families. Despite the extended time period these donations took place, they cannot be considered as long term CSR activities. The difference between them is that long term CSR activities express practices that aim to the mitigation and planning of similar disasters and those are examined separately below (Figure 5.3.2).

Long term CSR activities Greek corporations % Californian corporations % Infrastructure modifications and creation of Long term funding of non-profit organizations for 17 55% 6 33% emergency operations center disaster initiatives Working with local leaders, community Financial investments and corporate grants in 8 26% 5 28% organizations, government officials disaster-struck communities Infrastructure modifications and creation of Stakeholder educational and training programs 3 10% 3 17% emergency operations center Financial investments and corporate grants in Working with local leaders, community 2 6% 3 17% disaster-struck communities organizations, government officials Long term funding of non-profit organizations for 1 3% Stakeholder educational and training programs 1 6% disaster initiatives Figure 5.3.2 Long term activities of the Greek and Californian corporations

The majority of the Greek corporations that practiced long term CSR have concentrated on infrastructure restoration either by providing technical services and cables to restore electricity or telecommunications, or by taking part in rebuilding initiatives of community structures. For example, Hellenic Petroleum and OPAP undertook the full restoration and renovation of School Complexes, Motor Oil and NN Life took on the rebuilding of the Lyreio Children’s Institution, which had suffered significant damages from the fire and Heracles Group of Companies contributed to flood protection works.

A noteworthy observation has to do with the collaboration of the Greek corporations, as for the removal of materials and burnt timber the biggest construction groups of companies (Avax, Ellaktor, GEK Terna, Mytilineos) were mobilised. Moreover, for the development of an online, informative observatory (matiobserver.gr) three of the corporations of the sample (Aegean Airlines, Mytilineos, Papastratos) co-operated under the terms of CSR. This last type of CSR was identified as a creation of emergency ‘online’ operation center, for the purposes of this study. In total, more than the half (55%) of the Greek corporations that had a long term response used ‘infrastructure modifications and creation of emergency operation center’. A big part of them (26%) also reported on collaborations with government and local authorities to plan their efforts and provide aid to the affected citizens.

Less corporations used CSR practices like ‘stakeholder educational and training programs’ (10%) and long term financial investments in affected communities (6%). Even though partnerships with NGO’s played a significant role for the immediate CSR response, only 3% of the Greek donor-corporations offer ‘long term funding of non-profit organisations for disaster initiatives’.

Once more, the CSR activities that are at the bottom of the Greek list are rather popular among the Californian corporations. Most of them (33%) have a network of pre-approved partner organisations that they fund systematically either directly or through their foundations. The Red Cross Disaster Responder Program and other Wildfire Disaster Relief Funds have been developed through the last years in California to aid the affected communities in the long run and the state’s private sector has been actively supporting them. Additionally, 28% of corporations that used long term CSR activities, raise their own funds and grands for disaster- stuck communities and place them towards the disaster relief efforts.

The rest 17% of the Californian corporations donated for ‘infrastructure modifications and creation of emergency operation center’. This time the donor-corporations did not take over the restoration of entire buildings like in Greece, but they replaced power lines and mobilised their emergency operation units. Another 17% report on partnerships with community organisations and governmental authorities. Finally, only 6% of them engaged in ‘stakeholder educational and training programs’.

To sum up, the existence of different giving patterns between the two regions is confirmed by the current results. The role of NGOs is of main importance for the immediate CSR action of the corporations, as both the Greek and the Californian sample reported on such collaborations. Non- governmental and volunteering organisations are of the first responders in cases of emergency, consequently, corporations co-operate with them to provide early relief to the affected by the wildfires communities. Except this CSR practice, the rest appear to be contrasted; the least popular CSR activities among the Greek corporations are rather popular among the Californian. The majority of Greek corporations acted through in-kind donations and secondarily direct funding, using a more direct response pattern. While the Californian corporations primarily proceeded to more complex giving patterns, usually with the deployment of foundations, by matching employees’ donations and making pledges.

As for the long term CSR activities of the corporations, differing patterns were also spotted. Once more the Greek CSR activities seemed rather ‘tangible’, with donor-corporations taking over infrastructure reconstructions and modifications, based on the indications of local authorities and organisations. Whereas, the Californian corporations insisted on widened financial contributions, by activating long term funds and investing in affected communities.

Extra analysis

An extra interesting finding that came up from the data analysis is about the environmental aspect of the CSR activities during the 2018 megafires. After the deadly results of these two incidents, relief efforts concentrated on community resilience and recovery, but were there any efforts to assist on recovery of the natural environment, the animals and the plants that live in it?

Almost 10% of the donor-corporations (6 Greek and 2 Californian) reported on environment- oriented CSR practices. Most of them proceeded to reforestation projects in the affected areas, by offering voluntary work and resources. Some even combined tree-planting activities with educational and informative causes. Remarkably, Robert Half International in California acted in an alternative way, by providing help to a local animal shelter. All these initiatives

46 show the interest of CSR performers not only towards the affected by the tragic events people, but also towards the affected ecosystems.

5.4 Sustainability Reporting of the CSR performers: Answering Q3

As it has already been mentioned above, 72,5% of the corporations of the sample use some kind of SR. Specifically, 69 out of the 100 Greek corporations report on sustainability matters, that is almost 10% more than expected, if someone takes into consideration the county’s mediocre performance in the KPMG’s survey (see Chapter 3.2.1). Whereas the Californian corporations of the sample are below the U.S.A.’s average (see Chapter 3.2.2), as 76% of them use SR. Even though these numbers are slightly different from what was expected, they actually show a similarity between the Greek and Californian corporations of the sample.

Moving further to answering the final research question, the focus goes to the disaster responders and how well- adopted they are to SR. For that reason, only the 83 corporations that acted through CSR practices have been studied. Their responsible philanthropic performance during the 2018 megafires is already known, what remains to be explored is their relationship with sustainability matters, thus SR.

With a general overview of Figure 5.4.1a it is easy to understand that the corporations that performed CSR activities related to the 2018 wildfires are rather familiar with integrated reporting. A percentage of 86,7% of them uses SR of any kind. This result indicates that the CSR performers of the sample also report on other environmental, social and corporate governance issues. Their disaster response to the 2018 megafires is part of their general CSR strategy, which they track down and publish.

In comparison with the general 76% of the corporations of the sample that use SR, it is clear that SR is even more popular among the CSR performers. Both the Greek (81%) and the Californian corporations (92,7%) that responded to the deadly megafires, are well-adopted to SR.

No Yes (0) % (1) % REPORTING GREECE 8 19% 34 81% of the CSR CALIFORNIA (US) 3 7,3% 38 92,7% performers SAMPLE (GR & CA) 11 13,3% 72 86,7% Figure 5.4.1a SR of the CSR performers

For the rest 13,3% the absence of SR does not necessarily indicate lack of a general responsible behaviour of the corporations, but it may denote lack of a structured and strategic corporate philanthropic activity. Whichever the case, their CSR was triggered by the severity of the deadly wildfires, so they became part of the disaster relief effort. This small amount of corporations does not choose SR as a tool of visibility, besides they use press releases and other announcements in order to communicate their actions.

The next step of the research was to run the same test with an extended model that includes GRI, given that GRI reporting is the most commonly used framework among the corporations of the sample. For the 83 CSR performers of this study, the results are presented in Figure 5.4.1b.

The extended model shows that a percentage of 66,3% of the CSR performers use GRI for their reporting. For the corporations that are both reporters and CSR performers, 76,4% of them use GRI. It seems that the GRI framework is extensively used by the corporations of the sample that acted responsibly to the 2018 megafires.

No Yes Yes- GRI (0) % (1) % (GRI) % REPORTING 1 GREECE 8 19% 4 9,5% 30 71,4% of the CSR CALIFORNIA (US) 3 7,3% 13 31,7% 25 61,0% performers SAMPLE (GR & CA) 11 13,3% 17 20,5% 55 66,3% (23,6%) (76,4%) Figure 5.4.1b SR of the CSR performers (GRI model)

Lastly, by examining the two regions separately, it appears that the Californian CSR performers use SR in a larger scale. As for the Greek reporters, they use GRI more than the Californian reporters. Regardless of these small differences, SR is well established among the responsible corporations of the sample, proving that the CSR behaviour can be linked to a corporation’s overall sustainable behaviour.

6. Conclusions

The present paper explores the response of the Greek and Californian private sector, through CSR philanthropic activities, to the disaster relief effort during the 2018 megafires. The results of the research show an extensive CSR of the corporations in both regions: 42 out of a hundred top Greek and 41 out of a hundred top Californian corporations proceeded to donations to the affected communities. It cannot be said that the Californian corporations were more responsible neither in terms of quantity nor in terms of quality. With a detailed view of each and every CSR activity of the sample, the different corporate giving patterns were found. For the Greek corporations, direct response (with in-kind donations and infrastructure restoration) was of major importance, while for the Californian corporations a more complex funding activity (with foundation matched and long-term disaster relief funds) was observed. Finally, the CSR performers of the sample seem to have a rather good relationship with SR, as 86,5% of them reported on sustainability matters at the time of the research.

Using empirical data from the two affected by wildfire regions, this research is among the first to comparative examine the real performance of the private sector in two different parts of the world when a similar natural disaster strikes. Prior research has explored CSR when natural disasters with international impact occur (Muller & Whiteman, 2009), but it is not the same case for local disasters, like the 2018 megafires in Greece and California. With data from the two affected regions, this study finds out that their corporations responded to the same extent in the disaster relief effort, supporting the stakeholder theory’s view that corporations ‘pay more attention to disasters that are closer to home’ (Muller & Whiteman, 2009). Here, what can be said is that the top Greek and Californian corporations paid the same amount of attention to the wildfires that hit their home countries.

From the institutional theory’s point of view, that wants CSR to be in accordance with the different institutionalised environments that it takes place, the results are mixed. The findings of the first research question oppose to the expected results, while the findings of the second research question can have a logical explanation, based on institutional theory.

According to the results of this research, Californian as part of the U.S.A., which is the top charitable country in the world, did not have a better CSR activity than Greece, which is at the bottom of the list in terms of philanthropy (based on Charities Aid Foundation’s surveys, CAF,2019). The same amount of corporations, within the two regions of the study, donated during the 2018 megafires. It can be either due to the severity of the disaster that stroke the two regions or due to limitations of the research that ignore other institutional forces that motivated the corporations. Given that institutional theory is not usually used in related to natural disasters literature, this result could trigger future research to explore the institutional forces that affect disaster response.

For the second research question, the existence of different CSR giving patterns between the Greek and Californian corporations of the sample is an evidence of the regional differences in corporate philanthropic disaster response that Muller & Whiteman (2009) recognise. The immediate disaster response of both the Greek and Californian corporations was based on

49 partnerships with NGO’s. Apart from that, the two countries reacted (immediately and long term) in a completely different way during the 2018 megafires.

This finding though, cannot support the ‘implicit-explicit’ model of the institutional literature, as the CSR practices of the corporations of the sample are considered as equal (a donation of $1 mil. cash is not more important than the rebuilding of a school, besides it could not be possible to cost the in-kind donations of the corporations). Nevertheless, the fact that the corporations of the sample belong to different economies can be a possible institutional explanation of this difference, as in Jackson & Apostolakou (2010). The Californian corporations raise their own Disaster Relief Funds or donate towards Relief Funds of organisations- like the United Way or Direct Relief- that collect various charities and then distribute them to emergency response and disaster relief actions. In Greece, as part of a coordinated market economy, the recipients of corporate donations are local authorities and public services responsible for civil protection and emergency aid and there are no such Funds. Under this perspective the direction of CSR, is rather a fundamental issue, than a matter of preference of the corporations.

The study of the different giving patterns, can make one more contribution to the natural disaster related literature. Throughout the research, two more categories of CSR were added to the Johnson’s et al. (2011) model, that is: A) Customer emergency support and B) Employees and customers in-kind donations. For any future researcher, this addition can prove helpful, as these CSR activities were implemented both by the Greek and Californian corporations. Furthermore, the environment- related CSR activities of the corporations should not be neglected during the study of megafires. Environmental recovery can play a significant role in resilience building, so monitoring the CSR activities that enhance this effort seems necessary. In this study, 10% of the CSR performers mentioned that they donated towards the environment; a percentage that cannot be overlooked.

For the SR of the CSR performers, the findings are rather encouraging, as the majority of the corporations that acted through CSR activities used some kind of SR, with the most popular GRI reporting. The integrated reporting of these corporations imply a generally sustainable performance of them. Their CSR activity for the 2018 wildfire relief effort was not a single event, but part of the corporation’s social and environmental responsibility. They offered relief to the affected communities and visibility to the CSR performers. An interesting approach for future researchers, would be to examine whether CSR advantages the community or the corporations that uses them as tool of legitimacy.

To sum up, the private sector’s emergency response to the affected by the 2018 wildfires communities, was part of the general sustainability strategy, as most of the CSR performers were also reporters. Their corporate philanthropic activity contributed to the immediate, as well as long term support of the affected communities in various means, regardless if the country had a good reputation of charitable giving.

Overall, this study contributes to the existing literature, with its empirical data. In some cases, it confirms prior results while in other cases it disagrees and gives the base for further study. Natural disasters- related literature can benefit from the findings that derive from empirical

50 evidence, while CSR literature can further explore the results and give them other possible interpretations.

Finally, its observations can be helpful and practically implemented for the management and planning of emergency response and the building of resilient communities. The private corporations may acquire a new perspective on CSR and could better organise their corporate philanthropy in response to future wildfire disasters. While for the public sector, the findings of this thesis may raise concerns about the existing practices and any possible improvements. A possible suggestion would be the implementation of Wildfire Relief Funds in Greece that would collect individual charities, organise them and then distribute them to well- programmed actions. Since the Greek corporations are willing to contribute to the wildfire relief effort, a Fund like that would facilitate their response. It would take over the emergency support of the affected regions and the long-term restoration of the community as well as the environment. Having the necessary experience on forest fires and with the right management system a Wildfire Relief Fund would bridge the gap between the public services and the private sector for the good of the affected societies and environment.

Can the coordination of the private sector towards disaster relief be real? Which CSR pattern is more efficient, when natural disasters strike? Which steps should be made in order to get close to building resilient communities and protecting the environment? These are some of the questions that need to be posed, and this study gives the basis of this discussion.

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