Deutsche Telekom is Europe's largest communications company and one of the largest communications carriers worldwide based on 2001 revenues of 48.3 billion euros. The company is active in four key growth segments of the global telecommunications market: mobile communications, network access services, consumer Internet services and integrated IT and telecommunications solutions. Through T-Mobile, Deutsche Telekom's mobile telephony subsidiary, and through other majority and minority shareholdings, Deutsche Telekom today serves more than 69 million mobile telephony customers worldwide. In 2001, Deutsche Telekom completed the acquisition of U.S. mobile telephony companies VoiceStream Wireless and Powertel Inc., forming the first transatlantic wireless communications operator utilizing the GSM digital wireless technology standard. Deutsche Telekom offers its customers a complete range of fixed-line voice telephony products and services through almost 57 million access lines. The company is a leading provider of high-speed digital access lines, with about 2.4 million new asymmetric digital subscriber line (T-DSL) services currently sold and about 21 million channels using the information transfer standard ISDN (Integrated Services Digital Network) as of year end 2001. T-Online is one of Europe’s largest Internet service providers, with approximately 11 million subscribers. T-Systems is Europe's second-largest provider of comprehensive IT and telecommunication solution and services to business customers in more than 20 countries.
C.1.1 Restructuring, downsizing and outsourcing = reengineering
Reengineering within Deutsche Telekom follows a well balanced process:
Regardless whether reengineering measures are planned or not, a permanent board informs on a monthly base representatives of the works council on the economic situation of the company when specific reengineering measures are planned
Information of works council on the intended organizational changes and it´s impact on the number of working places
Negotiations with works council on a “balance-of-interests plan” concerning the reengineering issue
– should it be done
– who will be involved
– at what time
– how many and what steps
– job security for workforce and training
Negotiations with works council on a “social plan”, i.e. how much money will be spend for which social measure only when negotiations have come to a mutual agreement
- Start of reengineering measure
During the reengineering measure each individual change in personnel issues of each employee is double-checked by the works council
Dismissal protection Deutsche Telekom and the respective union have agreed upon a collective treaty that there will be no lay-offs as a consequence of reengineering until the end of the year 2004.
Incorporation of CSR Deutsche Telekom has just launched a project group to install an all over all management system regarding CSR in all fields of business. CSR thus will become an integrated part of corporate strategy.
C.1.2 DT`s Support to Matáv`s Restructuring Process in Hungary
DT started its engagement in Hungary in 1994, together with an American Partner (Ameritech International). Since many years DT strongly supports Matàv`s restructuring process, e.g. by providing experts (advisors and line managers) in all business areas of the company, e.g. strategy, technology, marketing,etc. These experts are an integrated part of Matá`vs change management process. Among other they perform the following key tasks:
initiating and coordinating projects
elaborating systems and tools
developing technical solutions, products and services
promoting process and quality management
designing and conducting training
reinforcing customer orientation (internally and externally)
On the peak 1997 and 1998, appr. 50 experts (30 DT, 20 Ameritech) worked in Hungary at Matáv, meanwhile the number has been decreased to appt. 30 in 2002 (DT exclusively, since the American partner left the joint venture in 2000). Apart from continuous long-term experts assignments, DT provided Matáv with a variety of short-term advisory services. (within a range from a few weeks to several months).
In the context of Matáv`s change management process, the following „highlights“ – with substantial involvement of DT – shall be mentioned as examples:
Culture Change Projekt
In 1996, Matáv started a comprehensive Culture Change Project focussing on management development, training, organizational development and business process management.
Management Exchange and Training Programm
Since 1998, DT and Matáv avail a bilateral Management Exchange Programme that has meanwhile been extended to specialists. In addition, a series of training activities take place for participants from both companies, based on annual agreements.
DT-Group Workers Council
An intensive exchange of experience has been initiated between the interrupt representations of the companies. Since 1998, representatives from Matáv`s Central Workers Council regularly participate as guests in the meetings of DT`s Group Workers Council
Starting on January 1 st, 1999 and 2002, respectively, Matáv implemented fundamental organizational changes taking into consideration the principles of DT`organizational concepts. That, the 2002 reorganization has been designed in line with the 4-pillar-concept (four business lines: mobile communication, fixed line communication, international business solutions and on-line services).
In 1999, Matáv`s joins with DT`s support EUROTEAM, an international organization in the training area.
Holiday Exchange Programm
Since 1999 DT and Matáv operate a Holiday Exchange Programme that offers the possibility for employers to use the holiday resorts of the partner company at attractive prices.
Matáv`s Investment in Macedonia
At the beginning of 2001, Matáv took over a majority share in Maktal, Macedonian`s incumbent. A couple of DT experts from different areas were involved in the acquisition process.
Social Dialogue Committee
Initiated by DT, Matáv participates since 2001 in the activities of the EU`s Social Dialogue Committee, mainly as member of the working group „Enlargement“. In September 2001, a conference on Social Dialogue, in the context of privatization and liberalization, took place in Balatonkenese (Hungary).
Human Resources Synergy Project
In 2001, DT started an international Human Resources Synergy Project that includes Matáv (+ Maktel), Slovak Telekom and Croation Telekom. The utilization of synergies focuses on three main areas:
planing and controlling, training and development, compensation and performance management.
In summary, Matáv obviously is a good example for DT`s active role in the restructuring process and its commitment to social responsibility.
C.1.3. DT’s measuring tools of CSR projects
The following tools are being applied to measure the company´s all-over- all progress in CSR:
* Defining indicators concerning people:
product and workforce safety
labour standards and conditions
equal opportunity and access
local and global environmental quality
cleaner production processes
sustainable enterprise development
education and training
* Implementing areporting system according GRI standards
delivering Triple Bottom Line Reports
* Social Responsibility Investing,
Individual managers` success on specific goals based an the company´s CSR vision are measured as any other individual business objective:
agree on the target
define the measuring scale
link it to the individual performance driven part of the remuneration
measure the goal achievement
* One other tool could be to measure employee-satisfaction.
C.1.4 Discussion: DT, CSR measuring tools and NGO’s
The degree of attention on CSR issues is a lot higher since more external driving forces are putting pressure onto DT. CSR could be thus seen as the communications answer to globalisation. The decision to set up internal CSR indicators is based on the experiences made with the ecological audits in the past, but with the knowledge that those really are only “best guesses”.
There are no real bad practice examples. The idea to look at CSR more closely is born from the fear to be doing something wrong and risking the market value as an international company. Thus the social aspects are actually valued higher because of the potential economical risk that they pose to the company.
The financial interest in CSR is the interest in keeping the human capital up-to-date, which in its turn is of course of strong economic value. CSR can be used in recruiting as a marketing argument, but not much more. But it could become more interesting, since more and more “outsiders” seem to consider CSR as an important value, even rating firms. The changing environment and the globalisation of DT have led to more engagement in CSR issues. The social partnership is established and as such a good tool in times of restructuring as well. At time administration do put special CSR issues in their tenders, so that DT has a chance to show suppliers that this is a serious issue for them. DT has set up Codes of conduct that are being followed. (see annex 5 attached).
The established social partners are experiencing troubles with the globalisation and fear that this could endanger the established German social partnership model as a whole, which would not be good for DT either. But on the other hand the new partners are not “insiders” yet and thus do not know, how the social dialogue works.
Seen as a whole, CSR is obviously executed for economical reasons, but set up together with the other social partners. Based on this social dialogue the CSR developments and ideas are implemented. If the indicators show that things are going wrong, adjustments are made. The reports are available to the public at all times. For the works council the indicator of sufficient support of CSR issues would probably be the votes of the employees during election times.
The efficiency of CSR is measured in the quality of the human capital. Only if the human capital is constantly developed, can the organisation fit into its constant moving environment.
C.2. BASF AG
BASF is the world's leading chemical company. It aims to increase and sustain its corporate value through growth and innovation. BASF offers its customers a range of high-performance products, including chemicals, plastics, coatings systems, dispersions, agricultural products, fine chemicals as well as crude oil and natural gas. BASF's distinctive approach to integration, known in German as "Verbund," is its strength. It enables the company to achieve cost leadership and gives it a decisive competitive advantage in the long term. BASF acts in accordance with the principles of Sustainable Development. In 2001, BASF had sales of EUR32.5 billion (circa $29 billion) and over 90,000 employees worldwide. BASF shares are traded on the stock exchanges in Frankfurt (BAS), London (BFA), New York (BF), Paris (BA) and Zurich (BAS).
C.2.1 CSR practices in BASF
Additional apprentices Offer for young people to carry out their apprentices not only within the company but within the region. (“Ausbildungsinitiative Pfalz”, see in detail)
Outsourcing with job guarantee Selling of part of the medical production (Knoll AG, to Abott, USA). This was part of the restructuring of BASF and the consolidation process. BASF decided to sell of the medical production (Knoll AG). They sold Knoll AG to Abott, in the US with the restriction that jobs be saved in the region. The management initiated this, but of course the works council supported this idea.
Investment fund for new jobs
BASF has set up a venture capital fund (BASF Innovationsfonds GmbH). This fund was at first established to help people set up there own jobs, so that less people would be working for BASF and at the same time establish more jobs in the region. But when set up the fund was also open to people that have not worked for BASF before. For more details see Appendix 1, page 2.
Training for other companies BASF trains more people than they could employ within the company. The company thus helps other companies that do not have the facilities or possibilities to train people in getting better personnel development. Since there are some potential problems involved (competition), BASF only trains people in “common” jobs, not too specialized, so that they will be able to find new employers.
C.2.2. Discussion: BASF, the traditional model of corporatism and the new stakeholder model?
Good practice examples for BASF are the offer for young people to carry out their apprentices not only within the company but within the region (http://www.initiative-fuer-beschaeftigung.de), called “Ausbildungsinitiative Pfalz”, founded in 1998 by chamber of commerce and BASF with 18 Mio. DM for new apprentices in the region as a start up financing. Additionally a Venture Capital foundation for new companies (for example Biotech) in the region and Start up capital for those that leave the company to found something on their own have been set up.)
The internal communication is based on the vision of sustainability, which stands for the conservation of social, economical, ecological resources. The employees are informed about the system of sustainability. The standard tool of CSR are reports on a descriptive level. Sustainability is a try to handle risk to make the company communications more stable. Thus it is an issue of internal and external communications.
The traditional relationship between the unions and the employers is good. BASF has an interest to invest in the human capital, since the technology develops so fast. An European Works Council has been established following Art. 13 of the EU EWC-directive 97/74/EG already in 1995 (24 May 1995).
CSR is not important as a term, but as part of the vision. It is important for the company to have a strong region to be attractive for employees (the best). BASF is doing more than is necessary, but only for economical reasons, because everything else would not be a lasting investment.
Even though there has been no real external pressure for change, BASF has decided that it is better to be along up front and put their own mark on the definition rather than getting marked by outsiders.The external pressure which definitely exists are the investors. “Capital is demanding”, and that can be met by using indicators. So far no real concern has come up, that major decisions or influence from CSR will steer BASF in the near future. Worst case scenario for BASF (from the Greenbook and the rest of the CSR discussion) seems to be, that more reporting (see Howitt Report) will be needed. More laws are no real danger, because that would be a national decision, which is already very “heavy”. But in any case BASF sees itself well equipped. It has installed a corporate staff which is in charge of editing regularly triple bottom line reports, organizing and harmonizing CSR issues, training management, doing internal Human Relations and external Public Relations. But other companies, especially smaller ones, would have trouble fulfilling new needs for more reporting.
There have been bad practice examples in related issues, which have helped develop a very open attitude (“we cannot hide anything anyways”). Thus it is important to act “straight” and be reliable at all times, because otherwise the investment in “soft issues” will be ruined quickly, which could mean financial problems as a result.
CSR is not a marketing instrument, but necessary to be ready for change which again is promoted by globalization.
BASF asks their suppliers to be consistent as well and sometimes for audits and that in turn is likely to lead to more stakeholders being interested in the CSR activities in the companies. Today this still seems to be “only” a communications issue, which is only related to the management, trying to sort out which issues are of actual importance to the company itself not “just” an overall issue, which cannot be handled by the company itself.
The vision of CSR activities was set up in the company by the management in the first place, but then implemented with the involvement of the works council. But economical factors drive the vision. The works council does seem to have a problem with this development, since they do not have any networking around Europe, nor around the world. They see the danger of new stakeholders coming, but have no possibilities to do anything against it, since they do not seem to have the necessary network. The works council today is responsible for its region only.
New NGO’s that are specialized are more attractive to the companies to deal with. The companies “use” this dilemma of the unions at times, but with the knowledge of the works council
There is no security in measuring such “weak” issues as CSR. No standard between different companies or sectors is yet established. But in a way it is reconsidered what other newly established audits did before and there are reports on social responsibility already available. The works council tries to measure the success of CSR with the appraisal of its members. The best overall measurement is the public, since lying is not possible without detection. This is probably the most important new stakeholder: Full information at any time. CSR as a tool is a tool to handle risk management. Just as an insurance it can hardly be measured (only in worst cases), but not if everything goes well.
CSR seems to be a term which is “in”. CSR thus is a new name for a tradition of “Mitbestimmung” which has already set up an established relationship between the employees and employers (social dialogue).
C.3. Volkswagen AG
The Volkswagen Group with its headquarters in Wolfsburg is one of the world’s leading automobile manufacturers and the largest car producer in Europe. In 2001, the Volkswagen Group achieved record sales totalling 88.5 billion euro. Net profits were 2.9 billion euro. With 5.084 million vehicles delivered to customers in 2001, the company attained a global market share of 12.4 percent (2000: 5.062 million). In Western Europe, the largest car market in the world, nearly every fifth new car came from the Volkswagen Group.
Since the start of this year, the Group's passenger car business has been divided into two Brand Groups with a total of seven independent brands. Under the leadership of the Volkswagen AG Board, Audi and Volkswagen are responsible for the results of their respective Brand Group worldwide. Audi's Brand Group is made up of the Audi, Seat and Lamborghini brands and places an emphasis on sporty values. The Volkswagen, Brand Group is made up of the Volkswagen, Škoda Auto, Bentley and Bugatti brands and stands for more classic values. Each brand retains its differentiated brand-image and operates as an independent entity on the market. Together, the product ranges extend from the low-consumption 3 litre vehicle to luxury class vehicles. Commercial vehicle products in the Group are the responsibility of the Volkswagen Commercial Vehicles brand. The 'Financial Services' and 'Europcar' business entities were put under joint management with effect from the beginning of this year.
The regional management of world markets comprises of four areas of responsibility: Region European Union, Region North America, Region South America/South Africa and Region Asia-Pacific.
The Group operates 44 production plants in eleven European countries and seven countries in the Americas, Asia and Africa. More than 320,000 employees around the world produce more than 21,000 vehicles on every work day. The Volkswagen Group sells its vehicles in more than 150 countries.
It is the goal of the Group to offer attractive, safe and environmentally friendly vehicles which are competitive on an increasingly tough market and which set world standards in their respective classes. The Volkswagen Group meets the challenges of the global market with a business strategy where the core elements are the modular components strategy and the multi-brand strategy. This combination simultaneously satisfies the customer’s desire for a high quality car, the employee’s interest in a future-orientated workplace and the shareholder’s concern for a lasting increase in the company’s worth.
C.3.1. Good practices by VW
Company credo: no dismissals Volkswagen created the motto “for a big company like Volkswagen dismissals are indecent. Solve the problem with energy and good ideas.”
Keep people in times of economic decline Instead of dismissals VW agreed – after long and difficult negotiations – with the works council to save jobs by cutting working hours (30.000 and 30h) during a crisis in the car industry.
Creating new jobs
VW is creating low-paid jobs (5000x5000 program) that otherwise could not have been created
Declaration on Social Rights
Volkswagen recently launched in accordance with its World works council and the International Metal Workers´ Federation a “Declaration on social rights and Industrial Relationships at Volkswagen”28. The declaration is a commitment of the world-wide Volkswagen Group to the vital items of CSR, such as freedom of association, anti-discrimination and respect of health and security norms. According to the declaration, Volkswagen also “supports and expressly encourages its suppliers and contractors to take this declaration into account in their own respective corporate policy (and) views this as an advantageous basis for mutual relationships“.
C.3.2. Discussion of VW good practices
Saving jobs as part of a CSR Policy? Volkswagen in 1993 has set up a program to save 30.000 jobs by cutting the working hours from 40 to 30 per week. This is the most important move for the company to move to become a “breathing company” able to adapt to its environment and to the customer and to the economical situation. The economical pressure could be sensed in the automobile sector overall, but Volkswagen tried to be more socially engaged than the other companies. This also means that both management (the “Arbeitsdirektor”) and the union (IG Metall) in corporate bargaining (“Haustarifvertrag”) did successfully negotiate collective agreements which contained flexible regulations in order to meet the company’s economic needs. This has not been able in the automotive industry over all.
One reason certainly is a certain inflexibility in negotiating branch oriented regional collective agreements (“Flächentarifvertrag”). Another explanation why Volkswagen followed other corporate solutions is the company’s philosophy “dismissals are indecent”
The vision was to manage the change of the labor intensive industry without shattering the region and the future of the production of Volkswagen overall and actually the whole automobile industry.
In the retro perspective view it cannot be said, if compared to the other companies in the same sector, Volkswagen has done a better job, but it can be shown that since 1993 the development of Volkswagen was one story of success.
It seems to be important to note that a joint venture between the region and VW was established to demonstrate that the region and the biggest company are connected to each other in many ways, so that one cannot live without the other.
Since then quite a few other programs with the same goals have been started, so that a whole system of activities could be identified, making sure, that
change is well managed
the Region develops accordingly to the needs of the company and is able to provide whatever the company needs
the job-market is able to develop the necessary human capital, again not only for the company itself, but also for the region.
The established system of state regulation and the new kind of self-regulation in VW Good practices by VW are not necessarily called CSR activities, but are part of the long traditional system of social dialogue within the company. It needs to be noted, that most of these activities have a high ranking supporter in the management, who, with a high amount of personal involvement, started these activities, to then develop them on in the context of the social dialogue.
According to VW tools need to be measured, to see if they are successful or rightly implemented. For CSR that proves to be rather complicated, since benchmarking is not really a possibility, since every project is different. And because not enough scientific research is available in that field.
According to VW reporting could be a tool within the EU to start benchmarking of such projects, so that one could learn from the experience of the other. But establishing a system of checks and balances to make optional programs a part of the law (or the like) does not seem to be able to help programs flourish. The own driving forces seem to help develop more creativity than a must-do program.
According to VW it cannot be denied, that there is a political driving-force to be active as a company to help develop the labor-market in the region, but really only because it is in the pure interest of the company, at least in the long run.
So far VW does not use CSR activities as a source of social marketing, as is for example possible with the ecological issues.
According to VW the established system of regulation is endangered in that the works council does have a problem with the open approach and the multiple stakeholders. Works councils still are only available for “insider”, but not so much for external stakeholders.
According to VW as a result one could summarize that the new system of self-regulation sets free creativity, which in its turn seems to do good for the company, the employees and the region. One way to use these good examples could be to make them more visible through a benchmarking and thus help others to follow. More regulation would probably endanger this creative approach, but would lead to less voluntary involvement of the companys instead of more. Self-regulation as such could thus be a successful way to more social responsibility.
Headquartered in Basel, Roche is one of the worlds's leading research-oriented healthcare groups in the fields of pharmaceutics, diagnostics and vitamins. The products and services of Roche include the prevention, the diagnosis and the therapy of illnesses. The Roche division of Diagnostics, market leader worldwide in the in vitro diagnostics market, has a unique spectrum of innovative test products and services for researchers, doctors, clinics and laboratories worldwide.
The Roche Diagnostics GmbH with its two locations in Mannheim and in Penzberg belongs to the Swiss healthcare group Roche and its diagnostics branch. Mannheim is the turntable of a large part of the diagnostic business for Roche. Out of Mannheim the national and a lot of the international activities are co-ordinated, products and services are developed, produced and distributed as well as marketing strategies are worked out. The central service of the diagnostic field is mainly applied in Europe and partly also in others of the more than 50 countries in total, where the diagnostic branch of Roche is represented. The activities of the Mannheim location practically serve all business areas of the diagnostics division.
In the main focus stands the business area Diabetes Care, which produces self-tests for people with diabetes. Diabetes Care co-ordinates its activities from the Mannheim base. It addresses the consumer directly and takes the laboratory to the patient, the person with diabetes. The aim is to help him relieve his daily routine with tools, tests and lancing devices by making the measurement of blood sugar a discreet minor matter. Under Accu-Chek, a worldwide introduced brand, the company develops and distributes technologies and services for relieving the lives of people with diabetes. Roche Diagnostics is leading on the sector of Diabetes Care and with Accu-Chek it presents the bestselling brand in the Roche group. Another important field is the "Centralized Diagnostics". Within the bounds of the laboratory network "Lab Network" it offers products, which include a variety of tools for routine tests in the doctor's office up to the latest genetic tests for professional health care.
The branch office in Mannheim, which is located in one of the three awarded biotech regions in Germany like its sister company in the Upper Bavarian Penzberg, is moreover the location of further functions as well. Two-digit growth rates confirm the course of the company as a precursor in the development of innovative systems, which provide an early diagnosis of illnesses or health risks.
The Roche location in Mannheim is specialised in the diagnostic business with all its facets and is at the same time one of the most multifunctional plants worldwide. The Mannheim employees also have an enormous know-how in the fields of chemical production of therapeutic effective substances as well as of production and packing of medicine.
C.4.1. Good practices by Roche
Save jobs by changing them
Save jobs by transforming job contents.
As part of the changing production, Roche keeps an eye on a very intensive training for their employees. This is to make sure that the very innovative fluid part of the production can be done by workers that have done a different job before.
Support the region The management of Roche is part of the “Förderkreis Rhein-Nekar”, supporting the area Mannheim and Ludwigshafen. This is a management initiated project to make sure that the region is strong enough to be able to support Roche and its employees and to keep the region attractive.
C.4.2. Discussion: Roche, state-regulation and incentives needed by a company to be more pro active in CSR issues?
With the takeover of Boehringer through Roche, a Swiss company with “not even a EU background” but a very international minded background, the economical need for change was obvious. At first some personnel reductions where unavoidable. The established social dialogue with the social partners was made aware through this exogenous shock, that other ways of making sure that the region Mannheim stays within the Roche-world would be necessary. The works council, together with the site managers (since this are needed to be worked out in the region) saw the economical necessity and knowing, that the supply-side of the human-resources for Roche would be endangered for the future, the company has decided to invest into the following project (until July 2003, in a successive manner) even more since the solid medical ingredients production is not an innovative production any longer, but for the fluid ingredients it is:
The production of solid medical ingredients will be moved away from Mannheim. This includes 150 employees (40 of which are on a management level)
But instead the production of fluid ingredients will be enforced in Mannheim.
The workers council set up, together with the management the following 5 issue plan.
The implementation of the issues 3 and 5 were actively supported by the works council. The works council is aware that there are no written promises, but still they are kept.
This makes it necessary to re-train a large part of the work force. First to show the need for change and then offer the new jobs within the company and make those available willing to be re-trained. None of the decisions was made without using the established social partnership, but the first move was made by the management. There was no external pressure to do as Roche has chosen to do. But the good and cooperative (and established) style has helped to proceed together on this issue.
Roche does not describe this process as CSR, since this term is not used as such. The tools that are being used are to define the exact qualifications of the employees today and to define on the other hand the exact needs of the company for the new positions. This project is not being used as a social marketing issue, but is used when recruiting new personnel, to demonstrate the long term interest of Roche in their people.
Benchmarking with other companies has not been done, since this seems to be an internal issue, where no external involvement is needed, nor helpful. That does not mean, that there is no external communication about the project. Would there be a need to do more reporting on social issues, that would not pose a problem for a large company such as Roche, but would not be helpful for smaller companies.
According to Roche with a “prescribed” CSR through legislation the companies would not do more than today, but only report more. The Unions do not seem to be ready to open up for more global involvement of other stakeholders.
According to Roche incentives for a company to be more pro active in CSR issues seem to be economical reasons for the company itself only. More regulation would lead to more reporting, but not more action. Thus social issues are already being cared for by the companies on their own incentive, but not necessarily under the name of CSR, but on the basis of the established social dialogue.
According to Roche the efficiency of the whole project will be hard to measure, but could be one way to use this example positively for future actions. The works council measures the project in terms of jobs saved or established with good overall working conditions on a long term basis.
Managers, works council representatives and unionists are deeply involved in CSR issues without associating it with the term CSR. Good Corporate Citizenship is more common as a term.
Especially in the Service Industry there is not yet a common understanding between companies, works councils and trade unions on the issues related to CSR and how CSR may impact the respective organisations.
As a consequence, there is no common understanding of co-operation between management and labour. Management and labour will have to decide whether each side will just react to the initiatives of the others or whether there will be a kind of co-management in CSR issues. At present, this process is currently “management-” and not “co-management” driven. CSR is a “management concept” and not a “co-determination concept”. These differentiations are essential for the understanding of the European CSR movement against the background of highly advanced regulative orders of taking on social responsibility.
The management is more globally minded and part of a better network (formal and informal), whereas the works council today is focuses on regional issues (where the voters are).
At present, German work counsels and trade unions play only a marginal role in the CSR movement. This means nothing else but companies and management succeeded to gain dominance in a field that so far was assigned to the trade unions. The competence for “social responsibility”, “justice” and “fairness” is a traditional domain of the trade union movement. Today companies rule the communication of this topic. For trade unions, this is a fundamental challenge which, however, does not seem to be realized. Furthermore, on a level of everyday practice, there is emerging an area of social responsibility beyond co-determination by work counsel and trade unions. This is a considerable strategic challenge, too.
The difficulties of work counsels and trade unions to find their share in the CSR movement seem to be based on the following structural parameters:
There core competence that is expected by employees and members lies in the field of wages and working conditions. So work counsels and trade unions would have to do educational and mobilization work in order to actually get a mandate for their CSR activities.
This would presuppose work counsels’ and trade unions’ ability for campaigns which they do not have at the moment. More and more, problems of CSR are located beyond the inherited forms of action, and demand a high communicative competence, both individual and organizational.
It is striking that from the management side fundamental CSR activities are the result of informal networks. On the part of work counsels and trade unions, this element seems to be missing almost completely.
If labour decides to be part of a co-management style, they need to adapt to the new situation, namely use more than the known tools such as strike etc., but campaigns, co operations with the new stakeholders etc.
At first sight, there does not seem to be any important CSR practice that was not already enabled by the German model of co-determination. In fact, the “German model” of taking on social responsibility by companies is developed on a high level. In the context of a regulatory policy and co-determination, trade unions and work counsels are partner in these activities. It should be noticed, however, that this system is challenged by the character of the new questions and the relevance of new „stakeholders“. Here a process is developing, at the end of which a new constellation could be found.
There is not yet a strong tendency to incorporate other stakeholders like NGOs into the traditional system of industrial relations. If there is a dialogue with other stakeholders it is predominantly part of risk management.
This addresses a central point. CSR is not a finished status or a product but a process of learning for all involved persons and organisations. In all European countries, this process of learning starts against a different historical background and on a different level. In each of the countries, new questions and new constellations of actors are the drivers of this learning process. Therefore it does not make much sense to make propaganda for more and more new examples of “best practices” and “evaluation” and “audits” because this does not take into account the developmental and process character of CSR.
It seems therefore, that CSR cannot be implemented with a big bang but has to initiate a learning process moving forward step by step. Management and labour need to find out for themselves, for their company, for their sector, for their region who the important stakeholders are and what ways of co-operation exist for mutual benefit.
Due to the lack of an agreed definition of CSR and due to the specific conditions in each European country organisations like the European Foundation for the Improvement of Working and Living Conditions should play a leading role in fostering CSR, launching initiatives, triggering processes, supporting the learning curve. etc.