UNDERSTANDING INTERNATIONAL CSR-STANDARDS: A COMPARATIVE ANALYSIS AbstractAssoc. Prof. Dr. Petya Dankova Dr. Milena Valeva Economics and Management of Industry Dept. Research Fellow at EthNa - Competence University of Economics – Varna, Bulgaria Center CSR, University of Applied Sciences [email protected] Niederrhein, Germany [email protected] Abstract: In this paper we admit that there is demand for orientation and better understanding of the variety of CSR-Standards from the perspective of the market actors. For this reason we first discuss the historically build understanding of CSR and introduce some international initiatives and standards. Taking the perspective of the market actor as a participant who needs orientation for embedding the social responsibility in the enterprise and reporting on it to the public, we focus directly on existing CSR-standards. We argue that the normative approach of business is underrepresented. Subsequently we compare the most prominent CSR-standards. As a result of the comparative analysis, we demonstrate the overlaps and the distinctions as well as the extent and depth of CSR in the discussed standards. Based on these findings we identify types of CSR-understanding. Keywords: International CSR-standards, CSR concepts, Stakeholder approach, Sustainability. RAZUMEVANJE MEDNARODNIH STANDARDOV DOP: PRIMERJALNA ANALIZA Povzetek: Avtorici dojemata potrebo, da bi se bolje orientirali in bolje razumeli raznolikost standardov DOP z vidika tržnih udeležencev. Zato najprej razpravljata o zgodovinsko izoblikovanem razumevanju DOP in predstavita nekaj mednarodnih pobud in standardov. Uporabita vidik tržnih udeležencev, ki potrebujejo orientacijo, da bi vgradili DO v prakso podjetja in poročanja javnosti o DO, in se osredotočila neposredno na obstoječe standarde DOP. Trdita, da manjka normativni pristop podjetij. V nadaljevanju primerjata najbolj sprejete standarde DOP. Primerjalna analiza jima pokaže, kaj se prekriva in kaj se razlikuje, pa tudi obsežnost in globino DOP v standardih, o katerih razpravljata. Na tej osnovi identificirata tipe razumevanja DOP. Ključne besede: mednarodni standardi DOP, koncepti DOP, deležniški pristop, sonaravnost 1. Introduction The vast literature on CSR confirms the rapidly growing interest in this concept both from an academic perspective and from the perspective of the business practice. CSR has never been more prominent on the political agenda as well as on the corporate reporting agenda than it is today. The international CSR-standards are growing in number and in scope. However, from the perspective of the market actors there is still much confusion as regards the specifics of the different CSR-standards. The objective of this article is to contribute to an improved and structured understanding of the differing international CSR-standards and thus to the further development of CSR concepts and instruments. Seen from the perspective of the practice, we introduce a systematic comparison of the most prominent CSR-standards. Regarding our methodological contribution we could emphasize the importance of the perspective of the single market actor (micro-level) when introducing CSR-standards on the national and/or international (macro) level. In the first section of the article we briefly discuss the historically built understanding of CSR in reference to the sustainability concept, stakeholder view of the firm and business ethics. We also summarize the evolution of the CSR concept on the European political level. In section two we compare the UN Global Compact, OECD Guidelines for Multinational Enterprises, OECD Principles of Corporate Governance, GRI sustainability reporting framework, ISO 26000 Social Responsibility, SA 8000 standard, German Sustainability Code and EFFAS KPIs on ESG as existing and recognized CSR-Standards. As a result of the comparative analysis, we demonstrate the overlaps and the distinctions as well as the extent and depth of CSR in the discussed standards. Based on these findings we identify types of CSR-understanding. 2. The CSR concept – theoretical and political background Business ethics, stakeholder dialogue and sustainability are among the most prominent concepts that explain the relation between business and society. These approaches are incorporated in the newly released term CSR. As an umbrella term CSR causes difficulties in the interpretation and even more in its practical implementation. The complexity of CSR requires an overview of its origins. The term sustainability has its roots in the forestry of the 18 th century in Germany 1. In the 20th century the definition of sustainability in the Brundtland report is close related to its origins “ Sustainable development is development that meets the needs of the present without compromising the ability of future generations to meet their own needs .” 2 Hence, sustainability is related to the long-term prospective of political economics; the normative approach is widely recognized. The stakeholder approach emerges as a reaction to the shareholder value paradigm and it is therefore based in the first place on the management theories. The fundamental tenet of the stakeholder concept is that the organization should be thought of as a grouping of stakeholders (“those groups without whose support the organization would cease to exist” 3) and the purpose of the organization should be to manage their interests, needs. It is obvious that this analytical concept requires normative approach. Business ethics in turn is applied ethics in business and economics; it emerged as an academic discipline in the 1970s. In the USA business ethics is interpreted as individual ethics and ethics in organizations, whereby in Europe business ethics is rather related to ethics in organizations and political economics. Within business ethics the normative approach (next to the empirical approach) is widely recognized. 4 Hence, the sustainability concept finds its origins in political and economic thinking; business ethics and stakeholder theory the contrary are applied to business and management. The normative approach is widely recognized in business ethics, whereby in stakeholder theory the normative element is rather implicit. In our view, business ethics as a normative approach builds the fundament of the CSR concept, by answering the question “Why should business be responsible towards the society?” Stakeholder management (theory) as an instrumental approach is crucial for the practical implementation of CSR, by answering the question “How can business be responsible towards the society?” Hence, in our view “CSR = Business ethics + Stakeholder approach” and is implemented at the micro level (the organizational level); and sustainability is implemented at the macro level. Therefore in conducting comparative analysis of the popularly called CSR- standards in section three we oppose CSR to sustainability. At the European political level the CSR concept was embraced for the first time in 2000 when the European Council made “a special appeal to companies' corporate sense of social responsibility regarding best practices on lifelong learning, work organisation, equal opportunities, social inclusion and sustainable development.” 5 In 2001 the EU Commission presented the Green Paper “Promoting a European framework for CSR” 6 aiming to launch a wide debate on how the European Union could promote CSR defined as “a concept whereby companies decide voluntarily to contribute to a better society and cleaner environment”. In 2002 a broader definition of CSR was introduced: “CSR is a concept whereby companies integrate social and environmental concerns in their business operations and in their interaction with stakeholders on a voluntary basis”. The EU Multi- Stakeholder Forum on CSR was set up, with the aim of promoting transparency and convergence of CSR practices and instruments 7. In 2005 the EU Commission recognized that CSR “can play a key role in contributing to sustainable development while enhancing Europe’s innovative potential and competitiveness”; and in 2006 the European Alliance for CSR was launched, described as “a political umbrella for new or existing CSR initiatives by large companies, SMEs and their stakeholders.” 8 In 2007 the Commission presented a detailed study of the national CSR public policies across the 27 EU member states 9. In 2008 the European Competitiveness Report concluded that CSR can have a positive impact on firm-level competitiveness. 10 In 2009 the president of the EC Barroso declared 1 The term is introduced in 1713 by Hanns Carl von Carlowitz, head of the Royal Mining Office in the Kingdom of Saxony, in order to meet the challenge of a predicted shortage of timber, the key resource of the time. Von Carlowitz indicated the need to care for the renewal of forests that had been cleared and that a balance should be reached between renewal and cutting so that timber could be used for ever, continuously and perpetually. “Schlage nur so viel Holz ein, wie der Wald verkraften kann! So viel Holz, wie nachwachsen kann!”, Von Carlowitz, H.C. (1713) Sylvicultura Oeconomica. 2 World Commission on Environment and Development (1987) Our common future.Oxford: Oxford University Press, p. 43. 3 Freeman, R. E., Reed, D. L. (1983) Stockholders and stakeholders: A new perspective on corporate governance. // California Management Review . Vol. 25, No. 3, pp. 88-106. 4 Donaldson, T., Dunfee, T. (1994) Toward a unified conception of business ethics: integrative social contracts theory. // Academy