csr and competitiveness report cosmic - asev and competitivenes… · 2009 final report of analysis...

2009

Final report of analysis about

relationship existing between

CSR and competitiveness in the

textile/clothing sector

Co – financed by European Commission

COSMIC Project CSR Oriented Supply – chain Management

to Improve Competitiveness

Task 3 - www.cosmic.sssup.it

COSMIC Project: Final Report of analysis about relationship existing between CSR and competitiveness in the textile/clothing sector

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INDEX

INTRODUCTION ………………………………………………………………………………….3

SECTION 1: DESK RESEARCH …………………………………………………………………5

DESCRIPTION OF THE TWO CONCEPTS: “CSR” AND “COMPETITIVENESS” ………………..7

a. The concept of Corporate Social Responsibility ………………………………………..7

b. The concept of Competitiveness ……………………………………………………….14

1. SUPPLY SIDE ANALYSIS AND INNOVATIVE PROCESSES/PRODUCTS ………………….. 22

1.a Literature Review ……………………………………………………………………25

1.b Evidences ……………………………………………………………………………38

1.c Experiences: THE GUCCI AND FILTEA CGIL EXPERIENCE …………………..44

2. MARKET DEMAND SIDE ANALYSIS …………………………………………………………. 50


2.b Evidences …………………………………………………………………………….59

3. CREDITS AND INSURANCE SYSTEM ANALYSIS …………………………………………… 67

3.a Evidences …………………………………………………………………………….67

3.b Experiences: THE POOL ANTI-POLLUTION, CO-REINSURANCE GROUP ….. 74

4. PUBLIC POLICIES ANALYSIS ……………………………………………………………….... 78


4.b Evidences…………………………………………………………………………….84

SECTION 2: EMPIRICAL RESEARCH - QUESTIONNAIRE ANALYSIS ………………..92

A. A FRAMEWORK ABOUT THE FIRMS……………………………………………………………93

B. THE CORPORATE SOCIAL RESPONSIBILITY ON THE FIRMS……………………………99

C. PERFORMANCES OF COMPETITIVENESS………………………………………………… 104

D. STATISTICAL CORRELATION BETWEEN CSR AND COMPETITIVENESS ………... 124

CONCLUSIONS………………………………………………………………………………...129

STATISTICAL APPENDIX ………………………………………………………………….. 133

MAIN BIBLIOGRAFY ………………………………………………………………………...188


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INTRODUCTION

This document represents the second report of Cosmic Project. In the first report (Preliminary analysis of textile sector in the three Countries), the structure of textile/clothing/tanning sector has been investigated, and trade flows between different regions of the world have been analyzed. In this second report we inserted the variable of Corporate Social Responsibility (CSR), seeking to understand the relationship with Competitiveness in the sector. The research question we are going to address is: “do firms that implement CSR-oriented strategies improve their competitiveness?”. From a territorial point of view, the focus remains the same as the previous report: Italy, Spain and France.

Every company operates within a competitive context, which significantly affects its ability to carry out its strategy, especially in the long term. Social and environmental conditions represent a key part of this context; there is a tight interdependence between business and society. Successful corporations need a healthy society to sell and promote their products, and to find good resources; at the same time a healthy society needs successful companies to get more innovative and efficient products. An investment in CSR could have different reasons: moral obligation, sustainability, but also advantage to operate, and reputation; and this could mean for a company be competitive. Those concepts are not easily translated into firms’ daily activities, especially when it comes to small and medium enterprises. Moreover, integrating business and social/environmental demands more than good intentions and strong leadership, because it requires adjustments in organization, accountability, and incentives.

In the European case, the institutions decide to foster CSR among firms to promote it as a driver of European competitiveness. The purpose is to keep European businesses globally competitive, and at the same time ensuring the protection of society and the environment. However, more research is necessary in order to measure and analyze the ways in which CSR can enhance competitiveness at the sector level, and this research represents a step forward in this direction. In particular, the purpose of this report is to explore the relationship between CSR and competitiveness in the textile/clothing and leather sector, and the path we have chosen to verify that is:

- clarifying what is the meaning of CSR and competitiveness; - providing an overview of the literature and the policies implemented so far about the

relationship between CSR and competitiveness; - analyzing the views of companies about the relationship between the two concepts, by means

of questionnaires.

The report starts with a description of the two main concepts: CSR and competitiveness. The attempt is to analyze the existing literature and the main theories for both concepts. In particular, the notion of CSR adopted by our research is stated, and an explanation of how companies can use CSR tools is also given. . For the concept of competitiveness a literature review is provided, a common definition is declared, and the key variables for measuring it are described. The second part of the report is focused on what already exists in the literature and what experiences have been made in terms of relationship between CSR and competitiveness. This part


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of the document is divided according to four key factors of competitiveness: supply side analysis and innovative processes; market demand side analysis; credits and assurance system analysis; public policy analysis (at a national and local level); for each factor, we have identified the existing literature review, and a collection of evidences and case studies on the use of CSR-related instruments. The last section of the report analyzes the results of the questionnaire administered. Indeed, we have considered appropriate to undertake a study in the field to measure the current state of the relationship between CSR and competitiveness for sector’s firms. The questionnaires have been addressed to a lot of firms of textile/clothing and leather sector operating in the three countries; in particular we’ve collected 274 answers: 150 from Italy, 63 in France and 61 in Spain. The questionnaire is a preparatory work for the last phase of the Cosmic Project (Task 4), as for testing and implementation of CSR policies in some selected contexts. In the last section of this report the main research results are summarized.


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SECTION 1 - DESK RESEARCH

The first part of this report summarizes the analysis about the relationship between CSR and competitiveness in the textile/clothing sector carried out after drafting the preliminary report related to the characteristics of the supply chain and productive sectorial peculiarities. Before going deeply into the matter of relationship existing between CSR and competitiveness in the specified sector, it is important (in coherence with COSMIC Deliverable n° 2 contents) To define the two key concepts, providing a short outline of main existing literature; these interpretations have been the basis for the following analysis of relationship between the two variables. In this preliminary analysis it was considered, first of all, the suggestions Made by European Commission in the European competitiveness report, 2008, chapter 5: Overview of the links between Corporate Social Responsibility and Competitiveness. In respect to the concept of CSR – Corporate Social Responsibility, an outline of the main available literature definitions is provided in order to identify the most useful to our approach; successively we’ve focused on main issues that fall under CSR heading, describing them and identifying the main representative elements. Finally, we’ve differentiated between explicit CSR (based on formalized tools adoption) and implicit one, based on intangible factors characterizing the relationship between enterprises and their stakeholders. The second preliminary investigated concept concerns competitiveness. In detail, we presented some definitions of competitiveness related to territorial and structural dimensions of this concept, following also those proposed by to the main institutions that in the past developed research and

promoted policies in this field (European Commission, OECD, World Economic Forum). For each quoted definition of competitiveness, specific measurement tools were identified, with the aim of giving a structured overview of the concept as well as of the key variables relating to it. The collected information of this preliminary section has been useful to the following assessment concerning the relationship existing between CSR and competitiveness in the textile/clothing/leather sector and in the three specific countries (Italy, Spain and France). In particular, the survey focused on the four competitive factors identified by the COSMIC methodological approach; were analyzed:

- Supply - Chain management and Innovative processes among SMEs in the sector: the analysis has been based on textile/clothing and leather SMEs dynamic efficiency and on CSR adopted models, in order to investigate the relationship between them;

- Market demand side analysis: a final market destination study, on products made in EU countries, has been carried out, focusing on Spanish, Italian and French best practices. The attention has been devoted to two elements:

o upstream phases of the distributive systems (before the products enter the final market), by identifying the main intermediaries and distribution channels;

o final-end consumers expressed preferences on the CSR-related features of the chosen products.

- Credits and insurance system analysis: the role of main financial institutions in the three studied countries and their CSR-related policies have been the subject of this item. Their credit worthiness or assurance costs evaluation systems have been investigated in order to find out the most interesting experiences aiming at awarding the most ethical behavior;


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- Public policy analysis (at national and local level): in this part of the research the supporting role of public policy in the promotion of CSR management models and other volunteer tools by SMEs, has been analyzed (i.e. the existence of fiscal incentives or ways to simplify bureaucratic procedures).

For each competitive factor, we identified a set of tools and sources adoptable for surveying the existing relationship between competitiveness and CSR. In particular, for each competitive factor, we:

� carried out an academic literature review and/or survey on existing databases in order to summarize the results of previous analysis or research (section named: Literature Review);

� carried out a collection of evidences about the contributions given by the different stakeholders (textile/clothing SMEs themselves, consumers and distribution firms, banks and insurance institutes, public authorities) to the adoption of CSR related tools by textile/clothing SMEs in the three focusing Countries (section named: Evidences);

� finally, described two experiences (the first in the field of supply-chain management and the second in the field of credit and insurance one) to be considered best practices (section named: Experiences).

In respect to each analyzed section different sources of information were adopted. In relation to the Literature Review, the sources have been the international academic literature and studies developed at international level and oriented to provide evidences of relationship between CSR and competitiveness; regarding Evidences, the sources have been the public documents and the communication and information tools describing the different initiatives of excellence and the obtained results; finally the Experiences have been the result of specific interviews and documents given from contacted organizations. The section criteria of adopted information related to Literature Review and Evidences have been the following ones:

- literature review: the references considered the most interesting for SMEs and/or for textile/clothing sector (both dimensional and sectorial criteria). In defining the categories of CSR-related tools, where possible, we referred to the guidelines of the fifth chapter of the European Competitiveness Report 2008, identifying the following ones: Workplace CSR referring to how a company treats its Employees; Marketplace CSR which covers the ways in which a company operates in relation to its suppliers, customers and competitors; Environment-related CSR which describes the measures that a company can take to mitigate its negative impact on the environment; Community-related CSR referring to the relations between the company and the citizens and communities that may be affected by its operations. Finally, we added the social accountability reporting and management systems, cross-categories in respect to the previous ones. - evidences: the selected references have been those of textile/clothing sector in the three focused Countries (Italy, Spain and France) (sectorial and geographical criteria). In this case public credibility and effectiveness of proposed actions in favor of SMEs (in particular of the focus sector), have been the main selection criteria.

Finally, Experiences are two: the first related to the Supply - chain management topic and the second related to the Credits and insurance system analysis.


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DESCRIPTION OF THE TWO CONCEPTS: “CSR” AND “COMPETITIVENESS”

a. The concept of Corporate Social Responsibility

It is very tempting to provide a single and unique definition for the concept of CSR. Actually, this matter has been a subject in the business community for quite a long time. However, the bulk of the literature around this topic is a recent phenomenon that started in the mid 20th century. Having said that, the objectives in this report are to provide a comprehensive definition of CSR, that is fit for use into a real context such as the development of projects like COSMIC.

Evidence shows that an extensive range of activities and actions are coined ‘Corporate Responsibility’. Moreover, one single definition may not be able to capture the widespread essence of the term, due to its multidimensional features encompassed in the term (policies, processes, initiatives, tools, etc). This “term is a brilliant one; it means something, but not always the same thing, to everybody”1.

Often when referring to the field of corporate responsibility, additional phrases are used, such as:

• “corporate social responsibility” (CSR), is the most common expression, with a focus on the role of business in the society, and local community. While it is quite clear that business seek a profit from providing goods and services in response to society’s demands (real or supposed), it is much less obvious what constraints should be put on its activities and who should impose them for the safety of society. It represents the opposite of Milton Friedman’s advocacy: “the business of business is business”2. Often, the modern conceptual framework of CSR is tied together with stakeholder theory, formulated for the first time by R. Edward Freeman in 1984. The stakeholder theory introduces a management approach on CSR, no more as exclusive personal responsibility of businessman3. Thus, probably at this point it starts a managerial holistic view of CSR, which cross the borders of “charity” and “philanthropy”. A stakeholder is defined as “any group or individual who can affect or is affected by the achievement of the organization’s objectives” (Freeman, 1984) or activities; and towards stakeholders – not just shareholders - an organization has some responsibilities to deal with.

• “corporate sustainability”, initially used to emphasize the increasing importance of environmental concerns and the building of eco-efficiency agenda in businesses. Currently the concept of sustainability is more referred to the ability to sustain a high quality of life for current and future generations. We can easily identify two sides of the phenomenon: an internal sustainability, internally to the organizations, that means the capacity of long-term prosperity/competitiveness; and an external sustainability, own of the society as whole, that means the possibility on maintaining and renewing resources, with due respect for people

1 Cf. D. Votaw & S. P. Sethi (Eds.) The corporate dilemma. Englewood Cliffs, 1973, p.11.

2 Cf., for example, M. Friedman, The Social Responsibility of Business is to Increase its Profits, The New York Times Magazine, 1970; and M. Friedman Capitalism and freedom, Chicago, 1962. 3 If Howard R. Bowen should be called the “Father of Corporate Social Responsibility”, we have to keep in mind that his approach is referred to businessman. H.R. Bowen, Social Responsibilities of the Businessman, New York, 1953


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and environment. Well known is also the notion of “triple bottom line4” accounting, which implies for organizations an attention to the traditional financial bottom line as well to social and environmental bottom lines (three levels of sustainability).

• “corporate citizenship” (CC), originally referred to US corporate philanthropy, and now more as emphasis on the role of organizations as citizen in global society. Common understanding of CC is more general in scope, and is essentially a conflation of CC with existing conceptions of CSR, with an attempting to define a new role for the corporation. CC is a term widely known in the US, because the philanthropy aspect is still predominant (C. Keinert, 2008). Corporations voluntarily assume responsibilities as a major actor within society by contributing to the enhancement of the quality of community life through active, participative, and organized involvement. Thus, in administering some of the responsibilities of citizenship, companies are increasingly finding themselves held accountable for their impacts on society and social rights, on individual or civil rights, and on political rights (S. Waddock, 2006).

• “business ethics”, refers to general ethical systems applied in the context of profit-oriented organizations. The subject is part of philosophical ethics (F. McHugh, 1988), and it is related with “doing the right thing” (R. Sims, 2003). Business ethics is in part concerned with the behavior of individuals as members of the company and wider society, but it is also increasingly concerned with the values of business as a whole and how company integrates values, such as honesty, trust, integrity, respect and fairness, into its policies, practices and decision making (M. Blowfield and A. Murray, 2008). However, the relation between CSR and business ethics theory is still quite debated at the present time.

For our research the more adequate definition is the one of Corporate Social Responsibility, whereas some clarification is needed. This involves the evolution of the main concept about the role of business in society, and it has a concrete topical framework. Trying to break down the term, it can be explained as:

� corporate: this word defines who the subject of the topic is; corporate is something relating to a corporation, a body that is granted a charter recognizing it as a separate legal entity. For this reason, when we talk about CSR, we can refer to a private as well a public institution, with a profit making scope or not-for-profit organization5. CSR is relevant in all types of organizations, regardless of size or sector of activity.

� social: this word defines what the subject of the topic is; social is something relating to society. In accordance with the definition, we can assume that also the environmental issues are linked with the society, indeed the environment is a subset of our society. In this framework we can bring back two sides of TBL - Triple Bottom Line : social sustainability and environmental sustainability (both of the corporations and of the society as whole). Thus, here we can find the management and the engagement of stakeholders.

4 The term was coined by John Elkington in 1994; the same author developed in 1995 the 3P formulation, “people, planet and profits”, with similar logic of TBL. 5 For this reason we can have social reporting activities by a public institution (as an University), or specific CSR tools usable from both for profit or not-for-profit organizations (such as stakeholder engagement).


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� responsibility: this word defines the relation between “corporate” and “social”: the corporations have some responsibility on society; the respect of sustainability logic represents also the company’s capacity to perceive and evaluate the long-term consequences of its behavior (Waddock, 2001). The term responsibility doesn’t imply a mandated by law. On the contrary, the voluntary basis go beyond common regulatory and conventional requirements, which the organizations would have to respect in any case; they endeavor to raise the standards of social development, environmental protection and respect of fundamental rights, reconciling interests of various stakeholders in an overall approach of quality and sustainability (European Commission, 2001).

As previously mentioned, one can find several definitions of CSR. However, it is important to distinguish between attempts deriving from academic literature and those from public institutions and international bodies. The interest accrued in the years around this topic has demanded that some institutions take a position on it. The reason lies not in a will to impose CSR aspects, but rather in an effort to suggest a common framework to which refers to. It represents an attempt ensure that the process of global economic and social change is managed properly and fairly. On the other hand, type of definition of CSR is then directly by the companies: it is not uncommon to find an interpretation of the concept, adapted to the context of the single organization, in accounting activity or statement of mission.

For the purpose of this research, we decided to follow the institutional definition provided by the European Commission in 2001. It represents indeed an effective, structured and valuable synthesis of CSR definition:

“The CSR is a concept whereby companies [1] integrate social and environmental concerns in their business operations [2] and in their interaction with their stakeholders [3] on a voluntary basis

[4]”

[1] In this case the subject identified by the European Commission is “the company”. Rather, the definition of CSR could be extended also to subjects who are not firms, but still have a role in the economic life of society. In general then, we might refer to “organizations”, meaning either those public or private, profit or not-for-profit6 subject. Surely companies maintain the foremost role of implementation of CSR theoretical framework, but it is not the only one possible.

[2] The integration of social and environmental concerns in business operations reflects the sustainability theory, and the triple bottom line idea7.

[3] The responsibility of organizations is expressed towards all the stakeholders affected by business and which in turn can influence its success. So the European definition of CSR follows the approach of stakeholder theory, developed by R. E. Freeman since mid 1980s.

[4] Finally, it is reaffirmed the voluntary approach on CSR ideas and policies.

For the sake of completeness, we reported some of the most important literature’s definition of Corporate Social Responsibility: 6 See above, the explanation of the word “corporate”. 7 See above, the description of term “corporate sustainability”.


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� [Social responsibilities] mean that businessmen should oversee the operation of an economic system that fulfils the expectations of the public. William C. Frederick, 19608.

� [CSR] refers to the firm’s consideration of, and response to, issues beyond the narrow economic, technical, and legal requirements of the firm to accomplish social benefits. Keith Davis, 19739.

� For CSR to be accepted by the conscientious business person, it should be framed in such a way that the entire range of business responsibilities is embraced. It is suggested here that four kinds of social responsibilities constitute total CSR: economic, legal, ethical and philanthropic. Archie B. Carroll, 199110.

Without doubt, the application of CSR principles changes with respect to the context in which the organization works. As previously mentioned, the same definition of CSR is a “cluster definition” that fits its own contents to the reference context. Nevertheless, one can figure out a main framework of CSR, with different areas (M. Blowfield and A. Murray, 2008).

An organization must first address the issue of CSR from an internal point of view. The benefits for the society derived from CSR go through also an improvement of the same organization. It must seek to achieve long-term internal stability and competitiveness, in terms of organizational innovation and differentiation of its own products/services to market. From an internal perspective, CSR should be addressed in the following areas:

� Mission, vision and leadership:

o Defining and setting the organization purpose, values and vision: often, an organization gives its own definition of sustainability, outlining the principles that will guide its activities;

o Translating this into policies and procedures: after making a choice of CSR standards that are to be reached, the structure of the organization may need to be reviewed and adapted; as well as leadership needs to be coherent with chosen principles.

� Workforce activities: employees are one of the main stakeholders for an organization. The human resource management deals with fundamental principles for the respect of individuals; and it represents also an important strategic investment for productivity and faithfulness by workers.

o Employee communication and representation (transparency and representativeness);

o Diversity management;

8 Frederick, W. C. (1960). The growing concern over business responsibility. California Management Review, 2, 54-61. 9 Davis, K. (1973). The case for and against business assumption of social responsibilities. Academy of Management Journal, 16, 312-322. 10 Carroll, A. B. (1991, July/August). The pyramid of corporate social responsibility: Toward the moral management of organizational stakeholders. Business Horizons, 34, 39-48.


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o Work-life balance;

o Health, safety and well-being;

o Training and skill enhancement.

� Marketplace activities: this area regards an important part of economic sustainability. Indeed, by caring out some CSR performances, an organization can differentiate its products or services. It is also the first approach to the outside, managing external stakeholders relations.

o Responsible customer relations (including marketing and advertising, accessibility of structures/products/services);

o CSR certification and labelling;

o Fair competition.

From an external perspective, there are also areas that can benefit from the implementation of CSR principles. This part refers to the possibility for sustainable development to be completed.

� Supply chain activities: with the drive towards global markets and the removal of barriers to trade and investment, boundaries have become blurry, permeable, and difficult to discern, creating a situation in which it is difficult to discern between which stakeholders are internal or external. It is the case of supply chain: what are the responsibilities of organization regarding its supply chain? We could say that an organization must be able to create an entire system of supply chain, complying with the established principles of CSR, at least those considered essential and fundamental.

o Driving social and environmental standards through the supply chain;

o Promoting social and economic inclusion via the supply chain;

o Building a control and promote system on CSR principles.

� Stakeholder engagement: an effective CSR management must pay attention to stakeholders by adopting integrative strategic management processes. It is desirable pursuing stakeholder engagement policies, in which consultation and dialogue is carried out with the aim of gathering important input and ideas, anticipating and managing conflicts, building consensus among diverse views, and strengthening the company’s relationships and reputation.

o Mapping key SH and their main concerns;

o Responding to and managing SH;

o Accountability: transparent reporting and communication.

� Community activities: Some firms choose to engage with communities where they operate and exploit resources (economical, raw material and human) from. Those links could be


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beneficial for both, generating mutual advantages. On the other hand, other firms may prefer to function without those ties (i.e. a multinational corporation operating in a foreign country). However, firms cannot afford to assume this individualist position, without risking future problems with their stakeholders

o Respecting and promoting the development of reference community

o Using the community to facilitate the spread of CSR principles, through local institutions and services

� Environmental activities: This last point represents one of the three pillars of sustainability. The trade-off between environmental activities and financial performance has become more flexible over the years. Currently, firms understand that investments in the environmental realm could foster positive results in the financial one. The eco-effectiveness requires companies to rethink their technologies, their products and services, but can become an important driver of competitiveness and innovation.

o Resource and energy use;

o Pollution and waste management;

o Environmental product responsibility;

o Environmental audits, certifications and labels;

o Transport planning.

Thus, after an attempt to categorize the CSR concept, it is important to highlight the fact that there is relevant difference between CSR theories (principles declared) from practice. Differences arise because of competing interests, market priorities, financial difficulties, strong pressure to cut costs, and changing SH relationships. CSR values need to be translated into action across the organization, from strategies to day-to-day decisions (European Commission, 2001).

In general, it is common to find agreement around the respect of basilar CSR concepts (e.g. the ending of workers exploitation). However, as it has been proved, to translate those concepts into practices it is not an easy task. (e.g. due to competitiveness framework is necessary underpay workers). Most of the CSR approaches used at present by companies are too limited, too defensive, and above all too disconnected from corporate strategy which reduces its effectiveness in creating competitive advantages. CSR initiatives have to be parallel, or even, central to the core business strategies, rather tangential. The relevant CSR issue must be matched to the specific business; and it is essential a shift from moral obligation (or charity) to a strategic view. The Corporate Social Responsibility should be perceived as long-run profit maximization (Johnson, 1971).

Fostering CSR among organizations, several benefits could be observed A. Dayal-Gulati and M. Finn, 2007):

1. Reducing cost and waste: this variable constitutes hidden opportunity costs. CSR played the role of a heuristic that made it more likely for management to identify such cost savings.


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2. Accelerating product innovation: a focus on sustainability and environmental responsibility could lead to faster rates of innovation in high-impact technologies (again CSR serves as a heuristic, now with focus on the innovation process). CSR can also accelerate the organizational innovation, implementing management system for specific standards and certifications.

3. Creating and improving brand equity, increasing the value contained in a brand through a product/service differentiation.

4. Improving employee productivity and attracting or retaining talented employees, through equal treatment, benefits policies, incentives, and so forth.

5. Reducing various form of risk (legal, regulatory, political, reputational) with fair behavior; and, consequently, avoiding competitive disadvantages.

6. Improving relationship with political and local entities, hedging risk (point 5), as well as enhancing opportunities (social capital).

Some of these variables are typical of the competitive advantage and the strategy, others more operational (such as the first one).

The European Commission stresses the relationship between CSR, sustainability, globalization and competitiveness. The development of systematic responses to the expectations of society is a key to competitive advantage for firms: proving this represents the reason of this project.

Although the CSR framework and its implementation change considerably depending on the reference context in which the organization operates, there are some well-established and internationally recognized tools for implementation of CSR policies. These instruments are addressed to manage, measure and communicate CSR performance; indeed, they provide guidance and benchmark for sustainability.

Once again, pro – activity demonstrated by the European Commission to disseminate and make concrete the CSR framework leads us to refer to another official document of EC about it (2004)11. The document regroups CSR tools under three main headings:

1. Socially responsible management, which includes instruments setting out standards of performance and management issues used by organizations to embed CSR values into their strategy and operations and drive performance improvement:

a. codes of conduct: are formal statement of principles defining standards for specific behavior; it could be at organization level, as well as at multi-level (e.g. sector or trade association level)

b. management standards: refer to a set of procedures, process steps and specifications that an organization uses to manage a process or activity (certifications on: workplace standards, quality management standards, environmental management standards)

11 ABC of the main instruments of Corporate Social Responsibility, European Commission, Directorate-General for Employment and Social Affairs, 2004.


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a. sustainability reporting: include a lot of qualitative information about the organization, due also to the difficulties on measure some CSR performance12.

2. Socially responsible consumption, which describes market-based instruments (labels), mainly addressed to consumers, certifying that the production and trading processes of a specific product have respected a given set of criteria.

3. Socially responsible investment, illustrating the various approaches, products and instruments offered to responsible investors (social, green and ethical funds, pension funds, sustainability indexes, screening, shareholder engagement).

The tools discussed so far are part of what is known as “explicit” approach to CSR. It is always management tools, with standards to follow, and with not an immediate and simple implementation. If an organization does not use any of these tools, this does not necessarily means it is not involved in any way with involved in sustainability actions. Indeed, there exists other type of implementation of CSR, more informal and not at all times less effective. In literature this process is called “implicit CSR” (Matten and Moon, 2004), or “silent CSR” (Jenkins, 2004), or also “sunken CSR” (Perrini et al., 2006). It is very common among small and medium organizations, particularly embedded into the local community in which they operate. Due to a strong intersection between local industrial system and local community, it is frequent and easy for an SME to makes informal CSR policies in local context, because of a strong presence of social capital (Chiesi, 2005).

b. The concept of Competitiveness

The absence of an univocal definition of “competitiveness”, both at theoretical and practical level, is mostly due to the variety of perspectives and levels of analysis at which the concept may be considered. By analyzing the different definitions of competitiveness provided by scholars, institutions and practitioners, it is possible to set a common “ground”: competitiveness is generally defined as “The ability of an ‘entity’ – a country, a region, an industry, a firm – to produce products or services of a superior quality and/or at lower costs than other entities that act in the same economic context”. What determines or influences the ability of an “entity” to prevail on its competitors is the capacity to use as better as possible its own endowed resources in order to obtain a better performance. Starting from this “common ground”, is important to identify the “entities”, the actors on the competition “arena”. The literature distinguishes three basic typologies of these actors:

1. A single firm or plant. At the firm level, the concept of competitiveness implies that companies are able to produce goods and services more efficiently or effectively than their relevant competitors; this performance is achieved by relying on some “competitive factors”, with a particular focus on the productivity of some inputs. An OECD paper (2003) states that “Competitiveness is primarily a matter of being able to produce goods that are either cheaper or better than those produced by other firms”. Similarly, according to Jenkins (1998), “A firm is competitive if it can produce products or services of a superior

12 Aid in this sense come from the Global Reporting Initiative (GRI), a network-based organization that has pioneered the development of a sustainability reporting framework (see www.globalreporting.com).


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quality or at lower costs than its domestic and international competitors. It is therefore synonymous of a firm’s long-run profit performance and its ability to compensate its employees and provide superior returns to its owners”. A recent paper for the International Energy Agency defines competitiveness at the firm level as “The ability to maintain and/or to expand market position based on its cost structure” (Reinaud, 2005).

2. A cluster of firms, i.e. an industry, a sector, a branch or a local productive system (e.g. an industrial district). At the sectorial level, the concept of competitiveness implies that the competitive factors are activated and used by different “clusters” of companies (e.g. all the companies operating in similar industrial sectors in different countries) to obtain a better performance on the market (local and/or international markets). In this case, the competitive performance is measured by aggregating the performance of the single firms operating in the same cluster. This level is connected with the previous one, but not totally overlapping: in fact, a competitive industry can be composed by a high number of competitive firms, but also by some low-performing firms.

3. A territorial context (i.e. a country or a region). At the territorial level (country or region), the concept of competitiveness is not limited to a market perspective, but it is also linked to “standards of living” of a geographical area, so it cannot be considered a zero-sum game, as one country’s or region’s gain doesn’t necessarily come at the expense of others. Moreover, the competitiveness of a country or a region is the result of a wide range of drivers and performances at the sector, firm and plant levels, and of their interactions with the institutional and social factors, so this level cannot be considered as the mere “sum” of the previous ones. The territorial dimension is closely related to the second question we address, i.e. what is the “context” in which an entity faces up with its competitors.

Following the identification of the actors on the competition arena, we can move on the issue referring to the “dimension” of competitiveness. At least three dimensions can be distinguished:

• International competitiveness. At the international level, competitiveness refers to the success with which an entity (i.e. a country, a sector/industry, a firm/plant) competes against overseas counterparts. The most important and widely-used definition of international competitiveness are those provided by the OECD and the EC:

o “The degree to which (a country) under free and fair market conditions, produce goods and services which meet the tests of international markets, while simultaneously maintaining and expanding the real incomes of its people over the longer term” (OECD)

o “Competitiveness is understood to mean high and rising standards of living of a nation with the lowest possible level of involuntary unemployment, on a sustainable basis” (EC Competitiveness Report).

• National competitiveness. At the national level, literature focuses on the measures of competitiveness, such as levels and growth of Gross Domestic Product or Gross National Product (SQW, 2006), GDP per capita (Porter et al., 1991) and international trade flows (Mulatu et al., 2001). In the view of most authors, the fundaments of national competitiveness rest on the efficiency with which resources are allocated and used at micro level (i.e. at sectorial and/or firm level). Still, as the use of national measures of competitiveness is often affected by various problems in identifying and understanding the


16

contribution of each variable on competitiveness, researches aimed at investigating national competitiveness should not ignore a more disaggregated level of analysis.

• Local competitiveness. Finally, the assumption of the local competitiveness perspective implies the consideration of a series of factors related to the characteristics of a territory/region, going beyond the behavior of local economic actors, having its roots in a complex set of relations between them and the institutions and organizations historically embedded in the territory itself. Most of all, two concerns based on theories pointing towards the link between territorial localization and competitiveness appear to be crucial. The first is that economic, entrepreneurial and technological activities tend to agglomerate at certain places, leading to patterns of regional and local specialization. The second is that the competitive performance and development of a firm seem to be determined to a considerable extent by the conditions that prevail in its environment, and that the conditions in the immediate proximity – in the local milieu - seem to be particularly important (Iraldo, 2002; Dicken and Lloyd, 1997; O’Sullivan, 1984).

After the identification of the competitiveness actors and arenas, the analyses deepen to the key variables affecting competitiveness as well as the ways to measure them. As anticipated, competitiveness is defined as the ability to efficiently and effectively use the resource endowed to obtain better performance than other actors operating in the same “context”. Many factors influence competitiveness according to the different levels of analysis. Furthermore, the variety of definitions of competitiveness provided by scholars and institutions according to the different possible levels of analysis runs parallel to the existence of many approaches and indicators aimed at measuring the concept of competitiveness. In an attempt to systematize existing approaches, we may distinguish two major approaches:

1. The first one tries to investigate the drivers of the competitiveness (e.g. the resource productivity at firm level, the degree of internationalization at sector level).

2. The second approach focuses on the external effects of the competitive success (e.g. the market performance measured by market share; the turnover growth rate; the financial performance measured by ROI or EBTIDA at firm level; the welfare of a nation measured by GDP per capita).

In order to provide the most useful conceptual framework a brief overview is provided about the main definitions of competitiveness provided.

European Commission definition. The definition provided by the European Commission in its annual Competitiveness Report (see section 2.a) mainly aims at proposing an analytical framework to assess the impact of policies – including environmental policies – on competitiveness. This definition stresses the importance of the so called “domestic factors” as dominant determinants of competitiveness. Furthermore, the EU Competitiveness Report was redesigned in 2006 to contribute to a solid analytical underpinning of the microeconomic pillar of Lisbon strategy, while continuing to explore more specific aspects of competitiveness of the European industry (EC, 2007). It is not worth that the microeconomic policy pillar of the Lisbon strategy covers many of the most relevant policy areas to enhance productivity, which are hence of great importance for our study as well. Actually, the EC Competitiveness Report stresses that:


17

• increased investment in R&D can significantly increase productivity growth, especially if R&D and innovation are well integrated;

• stimulating entrepreneurship by easing the start and growth of companies as well as enhancing conditions for SMEs to use the potential of the Single Market allows new ideas to be transformed into value-added products and services and these to be traded internationally, with an important positive effect on productivity;

• significant increases of output and consumption can also be achieved by reducing unnecessary regulatory costs, thereby freeing resources for more productive uses. The benefits will be felt particularly by SMEs, where such overheads represent a higher proportion of their total costs.

The OECD definition. The above reported “official” definition of OECD of a nation’s competitiveness emphasizes the ability of a country to produce goods and services which meet the test of international markets, while simultaneously maintaining and expanding the real incomes of its people over the long term. Anyway, it is necessary to clarify that a nation cannot be competitive just from showing aggressive market practices through exports policy on world markets through exports; it also needs to develop attractiveness for wealth creation activities. This policy, however, does not guarantee, in the long term, a standard of living. Therefore in addition to the view of the OECD competitiveness needs, balance in the economic imperatives with the social requirements of a nation as they result from history, value systems and tradition.

The definition of the World Economic Forum. Another definition of competitiveness has been provided by the World Economic Forum, which considers the level of productivity of a country as a key element to determine the competitiveness. It defines the competitiveness as “the collection of factors, policies and institutions which determine the level of productivity of a country and that determine the level of prosperity that can be attained by an economy” (World Economic Forum – Global Competitiveness Report, 2007). According to this view, the level of productivity defines the sustainable level of prosperity that can be earned by an economy. In other words, more competitive economies tend to be able to produce higher levels of income for their citizens. The productivity level also determines the rates of return obtained by investments in an economy and, consequently, the growth rate of the economy itself. The concept of competitiveness thus involves static and dynamic components: although the productivity of a country clearly determines its ability to sustain a high level of income, it is also one of the central determinants of the returns to investment, which a central factor explaining an economy’s growth potential. Furthermore, according to the World Economic Forum, the level of productivity – i.e. the level of competitiveness - is deeply linked to the microeconomic productivity. Wealth is created in an economy at the microeconomic level, it ultimately rests on the ability of the national firms to create valuable goods and services using efficient methods. The microeconomic foundations of productivity build on three interrelated areas: (1) the sophistication and capabilities with which domestic companies or foreign subsidiaries compete, (2) the quality of the microeconomic business environment in which they operate, and (3) the state of development of clusters that provide benefits through the proximity of related companies and institutions.

As a concern in the ways to measure competitiveness, it is important to bear in mind that

competitiveness itself may be considered at different levels of “aggregation”, each one may be composed and influenced by different variables.


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The international dimension of competitiveness is clearly affected by factors such as the existence and the nature of barriers to the circulation of persons and goods, the effects of globalization, etc. At national level, a country’s competitiveness is always the result of the interaction between a wide range of variables such as the exchange rate, real wages and other factor prices. It is also influenced by many factors, such as the sophistication of company operations, the quality of business environment, the employment rate or the efficiency of work, etc. Furthermore, industry or sectorial competitiveness reflects a wide range of performances of its constituent firms, among which there can also be some low performing firms. At firm level, competitiveness may be influenced by its ability to produce the biggest amount of output using a given quantity of inputs, by the quality of its human capital, by its ability to develop and exploit technological innovations, etc. Still, individual plants within the same company may present discrepant performances if compared to the firm’s average. . Understandings of competitiveness, thus, have different focuses on each level and imply the use of different measurement indicators. According to our framework of analysis, competitiveness can be measured at:

a) Macro level (territorial: international/national); b) Meso level (cluster: sectorial/industry/district); c) Micro level (plant/firm).

a) At the macro level, measurements of competitiveness aim at describing how successfully a country or a region (made up of different sectors and many firms) competes with counterparts in other countries. As anticipated (see section 2.b), the most common indicators to compare competitiveness between countries are Gross Domestic Product (GDP) and Gross National Product (GNP) (SQW, 2006), GDP per capita (Porter et al., 2001) and international trade flows (Mulatu et al., 2001). The first three indicators are particularly interesting from our point of view, as they focus on the effect of competitiveness on citizens’ “standard of living”, while the fourth indicator is very similar to those used for ‘sectors’ and ‘industries’ as it basically underlines the ability of a country to tackle the international competition. Degree of internationalization is considered a relevant component of the “competitive abilities”, with particular reference to the capability to specialize in global markets and, to a wider extent, to export to foreign countries. Indicators aimed at measuring competitiveness at this level rely on the fact that a When comparing countries, a given country competitive level can be gauged if it consistently export goods earlier than others do country can be gauged to be competitive compared to other countries if it consistently exports goods earlier than others do (Depperu, 2006; Rose, 1997; Feenstra and Rose, 1997). b) At sectorial/industry level, competitiveness relates to the capacity of a sector to sell cheaper and/or better-quality products and services, both in domestic markets and abroad. Competitiveness at this level is often an effective indicator of the economic health of those countries and regions where the sector/industry is located and, from our standpoint, it provides more meaningful evidence than competitiveness at the firm level. In fact, the success of a single firm might be due to company-specific factors that are difficult or impossible to reproduce. The success of a cluster of companies (geographically localised) is often evidence of factors (possibly linked to environmental factors) that might be extended or improved by means of a policy. Measurements of competitiveness at the industry level especially refer to the ability of specific industries to compete for market shares with businesses operating in the same sector but located in


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other countries or regions. Most studies use trade (e.g. net exports), investment flows and market shares as proxies or indicators of sectorial competitiveness (OECD, 2003). Other studies seek to consider the drivers of trade competitiveness at the sectorial level, such as the Total Factor Productivity and/or proxy measures of innovative capacity (mainly R&D expenditure and patent applications) (Jaffe and Palmer, 1997). The different localization usually affects the availability of production factors and inputs, including natural resources (Peterson, 2003). Some authors (Iraldo, 2002; Zoboli, 1999; Fortis, 2000) focus on the competitive advantage obtained by firms operating in a local system of production (as an industrial district or regional cluster). Finally, financial measurements such as operating profit and Earnings Before Interest, Tax, Depreciation and Amortization (EBITDA), even if rarely, are also used in the literature as measures of sectorial competitiveness (Carbon Trust, 2004). c) At the level of firms/plants, competitiveness measurements relates to various aspects, such as the ability to sustain market shares, to sustain independent existence on the market or to sustain “normal” levels of profitability and returns. At the firm level, productivity is the key variable, simply defined as the “measure of output per unit of input”. Productivity aims at measuring the efficiency with which production is carried out; in other words, the ratio between the outputs and inputs that make production possible (raw materials, labor, capital etc). Many studies identify as an optimal measure of productivity the Total Factor Productivity, that is a synthetic measure of how firms are organized, structured, use technology and are managed (for example: Jaffe and Palmer, 1997; Dofour, Lanoie and Patry, 1998; Berman and Bui, 2001). To summarize, existing literature provides a wide range of variables to capture the concept of competitiveness at firm level, such as:

• Output; • Import or export performance (e.g. net exports); • Market shares; • Profitability; • Labor Productivity or Total Factor Productivity (TFP); • Productivity drivers (e.g. innovative activity measures, such as R&D expenditures or patent

applications); • Cost of production; • Ability to absorb costs of compliance within costs of production or to raise consumer prices

as a consequence; • Plant location or locational decisions; • Firm’s or plant’s survival over time on the market.

In conclusion, the following table provides a summary of the overall analytical framework established on the concept of competitiveness as well as on and the different ways to measure it.

MEASUREMENTS OF COMPETITIVENESS – SUMMARY TABLE

Level of Analysis

Measure of Competitiveness

(Driver vs. Performance) Indicator References

MA

CR

O

Inte

rnat

iona

l / N

atio

nal

Prosperity/Standard of living (Performance)

Growth rate of real GNP Jorgenson and Wilcoxen (1990)

Level and growth of GDP and GNP Jorgenson (1991)

GDP per capita;

GDP per capita adjusted for purchasing power

World Economic Forum (2007)

Esty and Porter (2001)

International Trade

(Performance)

Net Export

Depperu (2006)

Mulatu, Florax, Witaghen (2004)

Rose (1997)

Feenstra and Rose (1997)

International trade flows Mulatu et al. (2001)

Productivity

(Driver) Productivity growth Jaffe et al. (1995)

ME

SO

Sec

tor

/ Ind

ustr

y

Market Performance

(Performance) Market share Peterson (2003)

Financial Performance (Performance) Earnings Before Interest, Tax, Depreciation and Amortization (EBITDA) Carbon Trust Paper (2004)

International Trade

(Performance) Net Export OECD (2003)

Investment

(Driver) Investment flows

OECD (2003)

Leonard (1984;1988)


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Direct foreign investment Blazejcack (1993)

Productivity

(Driver) Total Factor Productivity (TFP)

Jaffe and Palmer (1996)

Lanoie, Patry, Lajeunesse (2001)

Innovation

(Driver) R&D expenditure and Patent applications Jaffe and Palmer (1997)

Resource endowment (Driver)

Localization

Peterson (2003)

Fortis (2000)

Zoboli (1999)

Cost of transport O’Sullivan (1984)

Proximity

Iraldo (2002)

Dicken and Lloyd (1997)

Krugman and Obstfeld (1995)

MIC

RO

Firm

/ P

lant

Market Performance

(Performance)

Turnovers Dofour et al. (2007)

Levy (1995)

Market growth Gray and Shadbegian (1993)

Market share Gray and Shadbegian (1993)

Import or Export Performance (e.g. net exports) Cagatay, Koska and Mihci (2004)

Firm’s or plant’s survival over time on the market Levinson (1995)


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Economic Performance

(Performance)

Return on Equity (ROE) and

Return on Assets (ROA)

Bragdon and Marlin (1972)

Russo and Fouts (1994)

Coeck and Verbeke (1997)

Return on Sales Levy (1995)

Net Income Freedman and Jaggi (1992)

Brannlund et al. (1995)

Financial Performance (Performance)

Cash Flow (Equity and Assets) Freedman and Jaggi (1992)

Return on Investment (ROI) SQW (2006)

Efficiency (Performance)

Estimated Cost Function Gollop and Roberts (1983)

Sims and Smith (1983)

Ability to distribute costs of compliance Helland and Matsuno (2003)

Innovation (Driver) R&D Expenditure Jaffe and Palmer (1997)

1. SUPPLY SIDE ANALYSIS AND INNOVATIVE PROCESSES/PRODUCTS

This first section relates to the supply side analysis and innovative processes implemented by enterprises of the textile/clothing and leather sector. The study design is composed by a literature review, an analysis of the main evidences in three countries and the description of an experience of excellence in the field of social supply – chain management.

Initially an analysis of the academic literature has been detailed. Special emphasis was given to key researchers and case studies of the field. However, it is important to specify that not all the researched documents focus on the three investigated EU countries (but specifically only three of them), some of the details concern the specific sector, rather specific country. (textile/clothing and leather one). Those articles examined CSR related tools concerning the environmental and social management ones, the adoption of ethical codes of conduct and policies for defense of workers’ rights, tools of stakeholders management, and, finally, policies of (social and green) supply – chain management. Having described CSR tools, perhaps the most interesting effects demonstrated by researches and case studies in terms of competitiveness are related to the following topics: public image and reputation (such as Perry P. & Towers N., 2009; Turcotte M.F., Bellefeuille S. & Den Hond F., 2007; Murillo D. & Lozano J.M., 2009), rise of labour productivity (such as Ansett S., 2007), reliability in the supply – chain relationships and commercial networking (such as Camuffo A., Romano P. & Vinelli A., 2001; Ciliberti F., Pontrandolfo P. & Scozzi B., 2008; Graanfland, 2002), cost-efficiency and increase of market shares (examples are: Iraldo F., Testa F. & Frey M., 2009; Hillary, 2004; Lesi, F. & , Andalontal, D., 2005), innovation processes (such as: Krozer Y., 2008; Midttun A., 2007; Vilanova M., Lozano J.M. & Arenas D., 2009; Buyssey K., Verbeke A., 2003); on this last subject, it’s important to notice that the concept of innovation has to be interpreted both from technical and managerial - organizational points of views (such as the application of innovative management standards, aiming at increasing the social and environmental performances of enterprises). In the second section the most interesting initiative promoted were collected last years in the sector and involving also (or exclusively) the three specific countries. These can be considered the most evident ones, and that have already provided positive effects for the adherent enterprises. They can be considered a selection of best initiatives in the sector, aiming at increasing the competitiveness of ethical and environmentally friendly enterprises. Initiative were selected and promoted directly by enterprises (such as AFIRM Group, Elsewear, Clean and Unique, at international level, or Vera Pelle Conciata al Vegetale consortium and Made in Green at national level), and by public actors and adopted by enterprises (such as Ecolabel, EMAS APO and Distintivo de Garantía de Calidad Ambiental). To the following detailed sectorial initiatives, it can be added the institutional certifications and protocols of adhesion that can be pursued by all organization (and not only by those operating in the textile/clothing and leather sector); the most important are:

o SA8000 certification. This international standard aims to help companies in developing and managing social accountability systems, with the objective to improve CSR-related issues as child labor, health and safety and working hours. This model enable SMEs to be independent in seeking an own CSR language by implementation of a specific management system coherent with requirements of main international ILO conventions. In Italy 34 textile/clothing and leather enterprises have this certification, 1 in France and none in Spain.

o OSHAS 18001 certification. This international occupational health and safety management system represents a scheme aimed to provide organizations with a structured approach to prevent and manage occupational health and safety risks. This model enables a systematic


24

evaluation of issues related with working people, and an independent and continuous improvement process too.

o EMAS (Reg. N. 761/2001/UE) certification. This European standard requires establishing an effective environmental management system (EMS) on the basis of the review aimed at improving its environmental performance. This instrument is a guarantee for establish a better knowledge of the impacts and effects that an organization can have on the environment; for predispose their control and improvement. Similar to EMAS (but with a private nature) is international standard ISO14001:04. In Italy 27 are the EMAS registered enterprises of the textile/clothing and leather sectors, 6 in Spain and none in France.

o Global Reporting Initiative. It’s a network-based organization that has pioneered the development of the world’s most widely used sustainability reporting framework and is committed to its continuous improvement and application worldwide. The Sustainability Report focuses on environmental, social and economic requirements, with the aim to account and represent, qualitatively and quantitatively, the status of the practices in these fields. If a Sustainable Report is in compliance with GRI requirements, it can be certified.

o United Nations Global Compact. It is a strategic policy initiative promoted by UN for businesses that are committed to aligning their operations and strategies with ten universally accepted principles in the areas of human right, labor, environment and anti-corruption. If a company adheres, it’s forced to respect the ten principles giving evidences of this compliance. 16 French enterprises of the textile/clothing and leather sectors adhered to UNGC, 8 Spanish ones and none from Italy.

o Fairtrade Labelling. It is an alternative approach to conventional trade and is based on a partnership between producers and consumers. Fairtrade offers producers a better deal and improved terms of trade. For producers Fairtrade means prices that cover the costs of sustainable production, an additional Fairtrade premium, advance credit, longer term trade relationships, and decent working conditions for hired labour. The FAIRTRADE Certification Mark is a registered trademark of Fairtrade Labelling Organizations International (FLO). It certifies that products meet the social, economic and environmental standards set by Fairtrade. It’s important to notice that the Mark certifies products not companies; it does not cover the companies or organizations selling the products.

Finally, in the third part the experience of one of the most important international brands in the apparel sector (GUCCI) has been described, as an innovative example of supply chain management sustainability-oriented, aimed at monitoring the entire supply chain. This experience is interesting also because it has been carried out in accordance (and in cooperation) with the national sectorial trade union FILTEA – CGIL.

1.a Literature Review

References Description of contents CSR tools mentioned Conclusions

Ansett S. (2007)

Mind the Gap: A Journey to Sustainable

Supply Chains

Employee Responsibilities and

Rights Journal Vol. 19, p.295–303

This article examines the evolution of Gap Inc. and its work in developing an effective labor assurance program (based on the principles of international labor standards) and stakeholder engagement strategy; in this sense the Gap Inc. transformed its historically conflictual relationships with key stakeholders into collaborative multi-stakeholder partnerships. Particular attention is put towards Gap Inc.’s learning in the process and how these new insights innovated the company’s CSR strategy over time.

Codes of conduct / reporting / Certification (SA8000) / Community

related CSR / Workplace CSR

Gap Inc.’s participation in two multi-stakeholder initiatives with ETI and SAI enabled the company to continue to develop new relationships and learn from peer companies and other stakeholders, and it began to challenge the internal and external status quo. The company examined the findings and worked internally to change practice not only to improve working conditions, but also lower costs and to improve relationships with suppliers.

The conclusion is that it is becoming important for companies to integrate their acquired knowledge into corporate strategy to make their programs sustainable over the long term. Stakeholders are savvier at shifting the lines of traditional responsibility with more focus on companies and Gap Inc. has gone through a cycle of institutional learning.

Krozer Y. (2008)

Life cycle costing for innovations in product

chains

Journal of Cleaner

The paper indicates how few innovative actions of companies aiming at reducing emission in the chain of products, save costs of pollution control and even provide net benefits for companies in some cases. Ten cases are presented: tomatoes, an animal fat, a vegetable spread, a washing powder, a men’s shirt, an

Environment related CSR (emissions

reduction and green procurement);

Marketplace CSR (Stakeholder

management).

Although implementing environmentally friendly alternatives is more expensive than implementing end-of-pipe water treatment, the combination of sound machinery, prudent use of resources and the higher value sales that reduce monetary losses and enable more durable materials provide opportunities for a cost-effective changeover in the long run.


26

Production Vol. 16 p. 310 - 321

office armchair, a kitchen block, a television set, a copier, and a car. The costs of pollution control can in several cases be avoided or reduced through focused actions in the life cycle, including changes in suppliers, adaptation of the manufacturing process and in consumers’ behavior. Costs and savings in the chains of products are assessed with a decision support model by comparing compliance and preventative corporate strategies regarding the far-reaching emission reduction.

Companies’ decisions regarding demands for better environmental qualities are difficult because the demands differ and implementation is uncertain. The model enables assessments of the costs of compliance strategies by available technologies from the past, in comparison with the costs of preventive strategies by innovative solutions in life cycles of products, in case companies have to comply with the demands for far-reaching emission reduction. The cases suggest that companies in several cases benefit from the innovative strategies by saving costs of emission reduction in comparison with the compliance strategy, by generation of net benefit due to better product quality (which increases sales) or by lower costs in supplies and manufacturing.

Perry P. & Towers N. (2009)

Determining the antecedents for a

strategy of corporate social responsibility by

small-and-medium-sized enterprises in the UK

fashion apparel industry

Journal of Retailing and Consumer Services, Vol.

16 p. 377–385

This paper seeks to increase the understanding of the antecedents of corporate social responsibility (CSR) in small UK fashion garment manufacturing firms. A review of CSR practice is used to inform the theoretical development of the wider aspects of small business competitive advantage. The paper focuses on the strategic importance of global sourcing decisions, evidenced by the potentially catastrophic impact of stakeholder awareness of poor social standards in key suppliers (which may result in business disruption or even failure). The athletic apparel sourcing practices of five universities in the UK concluded that poor public reputation and unacceptable business practices of suppliers represent a risk to business continuity. This

Workplace CSR and management systems

(Ethical Trading, Standard ISO 26000 /

SA8000, Codes of conduct)

CSR may be perceived as a potential source of competitive advantage as well as a possible threat to garment manufacturing SMEs lacking sufficient resources to comply with the escalating CSR demands of large UK retail buyers such as Marks and Spencer, Arcadia and Primark. As well as complying with retail buyers’ demands, the implementation of CSR within a supplier’s business can help to reduce labor turnover, attract better quality workers and increase productivity. Implementing retailers’ standards enables suppliers to enter into long-term strategic alliances with their customers. However, for SME suppliers who lack financial and human resources and struggle to balance the day-to-day commercial and ethical demands of their buyers, the implementation of CSR is more likely to be problematic than for a large firm with dedicated staff and financial resources


27

suggests that CSR has a role in supporting business strategy. As well as the potential of increased profitability, there are many other strategic benefits supporting the business case for CSR, which are intangible and therefore do not appear on a firm’s balance sheet, such as employee motivation and retention, reputation management and management of investor relations and access to capital. Good CSR can help to establish good industrial relations which lead to higher productivity levels and higher employee morale, which in turn leads to less absenteeism and turnover as well as attracting better quality labor and lowering recruitment costs.

for the task. The additional burden of meeting external CSR requirements would lead to an increase in cost which some SMEs would be unable to absorb.

Midttun A. (2007)

Corporate responsibility from a resource and

knowledge perspective. Towards a dynamic reinterpretation of

C(S)R: are corporate responsibility and

innovation compatible or contradictory?

Corporate governance, Vol. 7:4 p. 401-412-3

This paper seeks to explore the interplay between corporate social responsibility and innovation and questions the premise, often underlying EU communications, that the two agendas are in general mutually supportive. In order to accommodate a closer fit the paper argues for a dynamic reinterpretation of CSR.

Marketplace CSR (innovation)

The paper documents the difficulties of assuming that innovation policy and CR policy can easily be mutually supportive. While the assumption of compatibility and synergy may be reasonable for some types of innovation and some types of CR (in particular in the environmental field), it can hardly be argued on a general basis. A core finding is the need to differentiate between complementary static and dynamic views. While much of the innovation literature is dynamic in its nature, much of the CR literature has traditionally been given a static interpretation, with the effect of a not specific identification of this relationship.


28

Wijayasiri J. & Dissanayake J.(2008),

The Ending of the Multi - Fibre Agreement and Innovation in the Sri Lankan Textile and Clothing Industry

OECD journal: general papers - Vol. 200B/4,

Institute of Policy Studies of Sri Lanka

This case study analyses the effect that the end of the Multi-Fiber Agreement (MFA) has had on innovation in the Sri Lankan textile and clothing sector. The ending of the quota system under the MFA led to an increase in the US and EU markets which has motivated a large number of innovations in the Sri Lankan textile and clothing sector, with a consequent development of this area and the implementation of philanthropic local initiatives. Some large companies have become a total services provider, while others are trying to establish their own brands. Product innovations with foreign partners, process innovations such as introduction of CAD/CAM, and various marketing and organizational innovations have been implemented.

Community CSR

A number of innovations were undertaken by the garment industry in Sri Lanka in order to face the challenges of a post-MFA quota-free environment. While competition in the export market has acted as a catalyst to innovate, trade and processes of local development have both been important as sources of innovation. Import of better quality textiles and accessories have allowed Sri Lankan garment manufacturers to explore new products, while cutting edge technology such as CAD/CAM technology, ERP systems as well as other capital equipment which are only available as imports have allowed the industry to keep pace with global advances in technology and compete in the global market.

Camuffo A., Romano P. & Vinelli A. (2001),

Back to the Future:

Benetton transforms its Global Network

Mitsloan management review, Fall, p.46-52

In the 1980s, while the provocative magazine and billboard advertisements of Italian clothing company Benetton caught the consumer's eye, the company's tremendous growth, outstanding financial performance and innovative strategies were captivating the press, scholars and practitioners around the world. For many years, it was the archetypal example of the network organization — that is, an organization based on outsourcing, subcontracting and, more generally, on relationships developed between a large company and several small producers and

Marketplace CSR

(rules of evaluation of suppliers, regarding also

ethical requirements)

For more than a decade, the network has been considered the most flexible organizational model, the one that ensures the highest degree of both differentiation and integration. Network organizations have developed especially in labor-intensive, mature industries, such as textiles and apparel. Benetton case illustrates how a company can design and manage its supply - chain innovatively.


29

distributors, or both.

Turcotte M.F., Bellefeuille S. & Den

Hond F. (2007)

Gildan Inc. Influencing Corporate Governance in the Textile Sector

Journal of Corporate Citizenship, Autumn

Social standards have become important tools in corporate governance. They are often presented as voluntary initiatives in terms of Corporate Social Responsibility (CSR) and are generally based on the principle of multi-stakeholder collaboration as a means to gain legitimacy. When two NGOs discovered abuses of the rights of the maquiladora workers who make Gildan T-shirts in Honduras, it resulted in a five-year controversy that ended only when the company adopted the standard promoted by the network of NGOs and unions

Workplace and management systems

(codes of conduct; Certification SA 8000, Oko-tex Standard 100)

The company was challenged both in Honduras and in Canada by a coalition of activist groups that expanded over time. Several organizations associated with the anti-sweatshop movement joined because the lead organizer of the campaign—MSN—was able to frame the issue in terms that appeal to their specific interests (e.g. in terms of unions’ rights for Solidarity Fund FQL, in terms of human rights for Amnesty International). Gildan responded by seeking to endorse different standards. The result was that the company endorsed a series of ethical codes of conduct and certification programmes, each additional standard posing more demanding or additional requests on the part of the company.

Murillo D. & Lozano J.M. (2009),

Pushing forward SME

CSR through a network: an account from the

Catalan model

Business Ethics: A European Review, Vol.

18: 1 p. 7-20

This paper presents the results of a Catalan project in which an academic institution acted as a practitioner to promote Corporate Social Responsibility (CSR) in Small and Medium-sized Enterprises (SMEs). The project involved the establishment of a working network with intermediate organizations and the creation of specific tools for the purpose. The paper is set up as a case study, emphasizing inclusion, representatively and legitimacy as key elements for the successful construction of a network to promote CSR in SMEs. It underlines the assumptions behind the functioning of this network and the learning findings from this public–private initiative. Presented from a

Community related CSR

The paper takes into consideration the relationship with different typologies of competitive variables: gain reputation and visibility on a highly media-sensitive issue, foster quality jobs, use of CSR management tools to foster sustainable development of the territories.

It opens up a path for future research, exploring how network management and leadership can be seen as key issues when talking about corporate social responsibility (CSR) promotion in SMEs.


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public policy perspective, the paper emphasizes the need for coordination in terms of the growing number of initiatives fostering CSR in SMEs. It presents a brief account of the material results, focusing on the process of creating a consensus within the network.

Ciliberti F., Pontrandolfo P. & Scozzi B. (2008),

Investigating corporate social responsibility in supply chains: a SME

perspective

Journal of Cleaner Production Vol. 16 p.

1579–1588

This paper analyzes the practices adopted and difficulties experienced by Small and Medium-sized Enterprises (SMEs) to transfer socially responsible behaviors to suppliers that operate in developing countries. In particular, a multiple case study was conducted on five Italian socially responsible SMEs operating in different sectors (Consumer products; plaster, restoration materials and demolition mortars; starting and industrial batteries; apparel for children; and furniture). It was found that companies use different strategies as well as diverse management systems and tools to address Corporate Social Responsibility (CSR) issues along their supply chains (SCs). The paper is innovative mainly since few are the existing studies that investigate the CSR practices adopted by SMEs in the SC. Furthermore, it is argued that the research can be helpful to SME managers willing to deal with CSR issues along their SCs, especially when developing countries are involved.

Workplace, Environment related CSR, Management systems (standards

SA8000, EMAS, ISO 9001/ 14001), and social reporting.

The success of the companies is probably related to their unique positioning in the market. Consumer behavior is not a CSR driver; the companies decided to engage in CSR due to the personal values of the owner /entrepreneur. Some of the companies think that in the future consumers will be motivated by CSR principles. Raising awareness on the value of CSR principles and advertising the effects of the adoption of CSR socially responsible behaviors and practices are means that companies can adopt to facilitate such a process.


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Vilanova M., Lozano J.M. & Arenas D.

(2009)

Exploring the Nature of the Relationship

Between CSR and Competitiveness

Journal of Business Ethics, Vol. 87 p. 57–69

This paper explores the nature of the relationship between Corporate Social Responsibility (CSR) and competitiveness. It starts with the commonly held view that firm competitiveness is defined by the market. That is the question of what are the critical competitiveness factors is answered by looking at how companies and financial analysts describe and evaluate a firm. To analyze this, the article reviews the current state of the art on the relationship between CSR and competitiveness.

Social Accountability, Community related CSR and Workplace

CSR

It is argued that CSR and competitiveness relate through a learning and innovation cycle, where corporate values, policies and practices are permanently defined and re-defined. Thus, it is proposed that learning, considered as CSR, is embedded in business processes; once it has been integrated, in turn, it generates innovative practices, and finally, competitiveness. The final sector of the paper, proposes that CSR in practice consists of managing inherent paradoxes generated by the tension between CSR and business policies.

Iraldo F., Testa F. & Frey M. (2009)

Is an environmental management system

able to influence environmental and

competitive performance? The case of the eco-management

and audit scheme (EMAS) in the

European Union

Journal of Cleaner Production, Vol 17,

Based on the unique dataset of the EVER project, this paper investigates whether or not an EMS implemented within the EMAS Regulation has any effect on firm performance both from an environmental and a competitive point of view. The enterprises of the dataset are both industrial and services, both big and SM, operating also in the textile/leather sector.

Environment related CSR and management

systems (standard EMAS)

The EMSs, in spite of their application in many years, have not yet achieved a high degree of ‘‘maturity’’ in their implementation. Moreover, they are not fully integrated in those corporate management dynamics that would enable an organization to effectively exploit its operational tools and instruments. This is particularly clear with respect to ‘‘supply chain management’’ and its effect on an organizations’ performance and on their abilities of valorizing the certification towards the market and the stakeholders. From this study it emerges that, with no doubt, the implementation of an EMS according to EMAS requirements provides a powerful impulse for an organization’s innovation capabilities; moreover the work also clearly emphasizes that simply adopting EMAS is not a sufficient condition. In fact, only if an organization obtains a real environmental performance improvement by way of its EMS, then it


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p.1444-1452 can achieve better innovation capabilities. Moreover, the EMS ‘‘maturity’’ is not a determinant per se of competitive performances. To this end, it is the extent to which an EMS permeates into the organizational structure that it can strongly influence competitiveness. This implies that also a ‘‘young’’ EMS, if well-designed and implemented (as well as adequately supported by investments), can provide considerable competitive benefits.

Hillary R. (2004)

Environmental management systems

and the smaller enterprise

Journal of Cleaner Production, Vol 12,

p.561 - 569

The environmental impact of small firms is not known either at national or regional levels. Voluntary self-regulatory initiatives such as the eco-management and audit scheme (EMAS) and the international environmental management system (EMS) standard ISO 14001 seek to provide all businesses with the means to develop systematic approaches to improve environmental performance. All purport to be relevant and applicable to small and medium-sized firms; however, their uptake by SMEs has been patchy at best and downright miserable at worst. This paper sheds some light on the barriers, opportunities and drivers for EMS adoption by the SMEs.

Environment related CSR and management systems (standards ISO 14001, EMAS, BS7750)

Extensive benefits accrue to SMEs adopting formal EMSs and this is widely reported in the analyzed studies. These benefits may also arise in small firms that implement non-formal EMSs. Internal and external benefits, however, are real, valuable and demonstrated in the studies and appear possible to duplicate in other SMEs, but the large majority of SMEs still remain unconvinced of the need to tackle environmental issues. Customers are the key driver for the adoption of EMSs and have influenced far beyond any of the other stakeholders cited in the analyzed studies. Paradoxically, customers also show lack of interest in, or are satisfied with SMEs current environmental performance. Micro enterprises, in particular, found their customers to be uninterested in their environmental performance. The SMEs are not homogenous sectors. It is diverse and heterogeneous. Studies which seek to investigate the sector and draw conclusions about it, are to some extent, comparing not just apples and pears, but the whole fruit bowl. This paper’s conclusions have this


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limitation. It recommends future research to consider parts of the sector either as sub-groups by size.

M. Longo, M.Mura, A.Bonoli (2005)

Corporate Social Responsibility and

corporate performance: the case of Italian SMEs

Corporate Governance vol.5 n.4 pp 28-42

The small and medium-size enterprises (SMEs) are particularly sensitive to the problems surrounding social responsibility: the small entrepreneur ‘‘experiences’’ in person, together with his family and his employees, the territory in which he operates, and shares with them both results and worries. The relationship he holds with the Local Authorities is far closer and more direct than that of a large business. The present study examines a group of SMEs belonging to various industrial sectors (including clothing and shoes sectors) and operating in the Emilia Romagna region in Italy. It has the following objectives: to identify the various actions of social responsibility adopted by the companies, to analyze the motives that lead companies to these initiatives, and to define an initial reference model for the SMEs in which the instruments and basic policies for the implementation of social responsibility are defined; finally the paper aims at clarifying the role that such initiatives play in each company’s attempts to render its operations competitively advantageous.

Workplace CSR, Marketplace CSR and management systems (standard SA8000)

On the basis of the analysis carried out using data collected from the company sample, it has been possible to identify the principal managerial instruments used by the companies for the creation of social value. In addition, it has been possible to identify those companies (approximately 63 percent) that adopt an integrated social responsibility approach. The majority of analyzed small and medium-sized companies have therefore perceived the social responsibility concept and welcome it, not only because they have moral or ethical reasons for doing so (as is declared by 51 percent of the companies examined), but also because they maintain that this contributes to the growth of the company’s own value, by means of an improvement in company image, ensure of the fidelity of customers and improvement in relationships with employees and with the local community. Italian companies are avant-garde in the acquisition of Standard SA8000 and companies are beginning to circulate its first corporate social audit and ethical codes. Initially, the relative investment was made above all by the large companies, but this is now spreading, as was found during the study, also to the small ones.

Kristel Buyssey, Alain Verbeke (2003)

Proactive environmental

This paper includes an empirical analysis of the linkages between environmental strategy and stakeholder management. In the research several types of companies are involved (a large part of

Community and Environment related

CSR

This study has interesting implications. The first implication is that effective environmental management requires the identification of important stakeholders; the key stakeholders may vary


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strategies: a stakeholder management perspective

Strategic Management Journal, Vol. 24, No. 5

May, pp. 453-470

which SMEs) operating in several sectors, among which the textile/clothing: the authors explain that this sector is particularly well represented. The green business literature usually makes a distinction between firms that are compliance driven (and merely aim to meet legal requirements) and those that adopt more proactive environmental strategies, thereby taking into account a variety of forces over government regulation. If the greening of corporate strategies can be interpreted as an attempt to meet these stakeholder expectations, then the identification of salient stakeholders becomes a critical step in corporate strategies. In addition to the government regulations, customers, shareholders and local community groups affect corporate environmental management practices, especially the content of environmental action plans.

substantially depending upon the environmental chosen strategy and the relevant institutional context faced by the firm. Their identification is the basis for an effective green strategy. Moreover, another result of this paper is that the environmental management is closely related to the development of green competencies in the enterprises; in fact, the research demonstrated that an active approach toward pollution prevention gives results in multiple domains: investments in green product and manufacturing technologies, in employee skills, in organizational competencies, in formal (routine-based) management systems and procedures, and, finally, in the reconfiguration of the strategic planning process.

Danish Commerce and Companies Agency

(2008)

Small Suppliers in Global Supply Chains:

how multinational buyers can target small

and medium-sized suppliers in their

sustainable supply chain

This report presents findings from a project carried out by the Danish Commerce and Companies Agency during the period June 2006 to January 2008. The objective of the project has been to develop guidelines on how multinational companies (MNCs) can target small and medium-sized (SM) suppliers in their sustainable supply chain management. The project centers on sustainable supply chain management, and more specifically on how multinational companies (MNCs) can work with SME suppliers in their sustainable supply chain

Marketplace CSR, Environment related

CSR and Management systems

The guidelines are developed on the basis of findings from SMEs in Central and Eastern Europe, but due to their generic nature, they may also be applied to larger supplier as well as suppliers in other regions. The elements characterizing the guidelines are the following ones:

- focusing on management systems as an integrated part of business operations

- following up on written requirements - continuing dialogue with stakeholders - engaging in industry-wide initiatives - engaging SMEs in capability-building activities


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management

Copenhagen

management programs. This topic is relevant to investigate because MNCs – particularly those with well-known brands – are increasingly introducing programs to ensure that their suppliers uphold certain social and environmental standards.

Lesi, F. & , Andalontal, D (2005)

Comparative

Advantage: The Impact of ISO 14001 Environmental

Certification on Exports

Environmental science & technology, Vol. 39,

No. 7

The present study reports the results of a survey to firms in six countries that are Israel’s leading trade partners, importing chemicals, textiles, and produce. The survey results confirm that while the international market still considers price and quality as the paramount factors in selection of suppliers, environmental management systems (EMS) are an important feature that is frequently taken into consideration. EMS certification appears to signify a supplier who is managing the business well and exhibiting ethical responsibility. The European market proved to be more environmentally conscious than those in other industrialized parts of the world. EMS offer a particularly valuable advantage for producers wishing to reach European markets.

Environment related CSR and management systems (standards ISO

14001, EMAS)

The survey results confirm that while the international market still considers price and quality as the determining factors for selecting suppliers, EMS certification for many firms is an important product feature that is also taken into consideration. EMS certification appears to imply a supplier who is managing its business well and is showing ethical responsibility. The fact that a supplier was awarded the ISO 14001 or EMAS certification by an independent entity enhances perceived reliability. Importers feel more confident engaging a new supplier, saving time and effort associated with clarification and research prior to placing a purchase order. The survey conclusively supports the position that firms wishing to expand their world markets will improve their competitiveness abroad by receiving ISO 14001 certification. The enhanced competitive advantage conferred by ISO 14001 constitutes an important message that needs to be disseminated by policy-makers and industrial trade organizations to companies around the world. Governments can also consider additional incentives by offering various forms of regulatory relief for certified industries. In doing so, agencies may be able to improve local environmental performance with relatively little


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expenditure of public resources and coercive enforcement activities.

Johan J. Graafland (2002)

Sourcing ethics in the

textile sector: the case of C&A

Business Ethics: A European Review,

vol.11 no.3

This paper analyses how C&A, as one of the largest Western apparel companies, organises its sourcing ethics, notwithstanding the financial pressure in the market. Based on interviews with Asian suppliers of C&A during the second half of 2000, the opinions of external stakeholders about the sourcing ethics of C&A is reviewed. Finally, an evaluation of C&A's sourcing ethics from a theoretical perspective is carried out.

Marketplace CSR and Management systems

Increasing competition in the clothing market tends to reduce C&A's corporate social responsibility efforts. Still, as shown by the positive decision of the European board of C&A to continue the activities of SOCAM and the efforts of this organisation to improve the audit procedures, the difficult market situation has not completely taken away C&A's relatively high commitment to corporate social responsibility.

Amaeshi, K. M., Osuji, O. K. and Nnodim, P.

(2008)

Corporate Social Responsibility in Supply

Chains of Global Brands: A Boundaryless

Responsibility? Clarifications, Exceptions and

Implications

Journal of Business Ethics 81:223–234

CSR can be broadly defined as an organisation’s commitment to operate in an economically and environmentally sustainable manner while recognising the interests of its stakeholders. In line with this broader definition of CSR, global brands like Nike, GAP, Adidas and McDonalds are often under intense pressure from groups working for responsible supply chain management. Much of this pressure is channelled through the supply chain, since the pressure groups sometimes find it difficult to reach the global brands directly. Since most of the firms along the supply chains are likely to be Small and Medium scale Enterprises (SMEs), this approach also exhibits the tendency of giving an inaccurate impression that SMEs are somehow shielded from engaging in CSR practices, which runs against the ethos of the CSR movement. In the contrary, there is a

Workplace CSR and Management systems

Complex business laws and business structures differ from country to country, undermining the applicability of any emergent universal, moral-economic principles. These prevalent conditions, critics say, often allow multinationals the free moral space to maximize profits and trump existing ethical obligations. This article seeks to challenge the often taken-for-granted-assumption that firms should be accountable for the practices of their suppliers by espousing the moral (and sometimes legal) underpinnings of the concept of responsibility. Except where corporate control and or corporate grouping exist, it identifies the use of power as a critical factor to be considered in allocating responsibility in firm–supplier relationship; and suggests that the more powerful in this relationship has a responsibility to exert some moral influence on the weaker party. The article highlights the use of code of conducts, corporate culture, anti-


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rising call for SMEs to participate in both CSR discourse and practice as well. This article, therefore, examines if firms should be responsible for the practices of their suppliers, the extent of this responsibility and how they could effectively translate such responsibilities, if any, into practice.

pressure group campaigns, personnel training and value reorientation as possible sources of wielding positive moral influence along supply chains.

Mamic, I (2005)

Managing Global Supply Chain: The Sports Footwear,

Apparel and Retail Sectors

Journal of Business Ethics 59: 81–100

Code of Conduct (CoC) sets guidelines on a range of issues including child labour, forced labour, wages and benefits, working hours, disciplinary practices, the right to freedom of association, health and safety, and environmental practices. The ILO embarked on an in-depth study of the management systems and processes used to implement Codes of Conduct in the sports footwear, apparel and retail sectors with the objective of providing useful examples and lessons-learned to companies, policy-makers and others interested in implementing their own CoC or who are actively involved in this field. Presented herein is a summary of the key research findings of the ILO.

Workplace CSR

Implementing a CoC across a supply chain is a complex process that companies are still grappling with, yet some have made more progress than others. In this paper, it is outlined a framework for the analysis of the management systems used by firms in implementing their Codes of Conduct. Utilising this framework as a foundation, it is summarized some of the key research findings regarding the steps involved in the creation of a shared vision, development of understanding and ability, integration of the CoC into operations, feedback, improvement and remediation systems, and the role of dialogue in all of these processes. Most of what has been documented by this research in terms of corporate systems did not exist 10 years ago and has changed, in some cases dramatically, since this research was carried out. The only certain thing about the future is that the situation will continue to evolve. This research provides a useful framework for considering what various companies are doing to affect their CSR goals down through their supply chains.

1.b Evidences

The research aimed at collect evidence of ‘best initiatives’ in the three studied countries (Italy, Spain and France) concerning the textile/clothing and leather sector. The list below briefly describes the experiences which are divided into two categories: International and national initiatives.

INITIATIVES INVOLGING THE THREE COUNTRIES

Oeko-Tex® Standard 100 and Oeko-Tex® Standard 1000

The Oeko-Tex® Standard 100 is a globally uniform testing and certification system for textile raw materials, intermediate and end products at all stages of production. The tests for harmful substances comprise substances which are prohibited or regulated by law, chemicals which are known to be harmful to health, and parameters which are included as a precautionary measure to safeguard health. A tested textile product is allocated to one of the four Oeko-Tex® product classes based on its intended use. The more intensively a product comes into contact with the skin, the stricter the human ecological requirements it must

Oeko-Tex® Standard 1000 is a testing, auditing and certification system for environmentally-friendly production sites throughout the textile processing chain promoted at global level. The secretariat is in Switzerland. To qualify for certification according to the Oeko-Tex® Standard 1000, companies must meet stipulated criteria in terms of their environmentally-friendly manufacturing processes and provide evidence that at least 30% of total production is already certified under Oeko-Tex® Standard 100. The certificate guarantees that the production process has been audited by Oeko-Tex standards and part of their production has passed a test for harmful substances according to Oeko-Tex 100 standards.

In terms of competitiveness this certifications allow firms to access supply chains which reward /

demand suppliers to gain this kind of certification and appeals to consumers that seek to purchase environmentally friendly products. They’re very important certifications in this sector.

The Oeko-Tex® Standard certified organizations are 655 in Italy, 192 in France and 317 in Spain

Community ECOLABEL award scheme

It’s the ecological label promoted by European Commission (Reg. CE 1980/2000) whose objective is to promote products which have the potential to reduce negative environmental impacts, as compared with the other products in the same product group, thus contributing to the efficient use of resources and a high level of environmental protection. Non deceptive and scientifically based information on the environmental impact of products. The EU Decision 2002/371/CE defines the requirements for textile/clothing goods.

Enterprises with Ecolabel certification gain visibility by EU initiatives related to awareness-raising actions and information campaigns for consumers, producers, traders, retailers and the general public, thus supporting the development of the Scheme. The Ecolabel allows the participation into EU tendering processes that require this kind of certification and appeals to consumers that seek to purchase environmentally friendly products. The conformity to Ecolabel makes easier the compliance with future regulation in the field of environmental protection, stimulating continuous innovation processes.


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In the textile/clothing sector the certified products are 12 in Italy, 2 in France and 1 in Spain.

Apparel and Footwear International Restricted Substances List (RSL) Management Working Group (AFIRM Group)

It’s an initiative carried out in Europe and United States characterized by the participation of several important trademarks of the textile, apparel and footwear sectors. It provides resources for sustainable, self-governing Restricted Substances List implementation across the apparel and footwear supply chain. The supply chain has knowledge about RSL and chemical safety, assuring that consumers and workers are safer from the impact of harmful substances and the environment is cleaner.

The adhesion gains the access to major retailers that participate in the AFIRM working group and the access to USA and European markets by compliance with legislation (i.e. REACH in the EU) via AFIRM participants.

ELSEWEAR

It’s an European initiative (promoted by Netherlands, but involving all EU countries) oriented to promote environmentally friendly materials, clean production processes and good labor practices in the textile/clothing industry. Recently Elsewear supported a specific project (Rank a Brand) aiming at promoting enterprises whose policies and ways of production are based on transparency, fair and environmental compatibility; Rank a Brand assures an accuracy of 99% of data diffused by enterprises and concerning their ethical and environmental performances. The adherent organizations to Elsewear are 14 from Italy, 6 from France and 6 from Spain.

Elsewear supports enterprises to join green initiatives and CSR actions and promotes their virtuous initiatives diffusing them amongst consumers and retailers.

Clean & Unique

It’s an initiative involving all EU countries (first mover: Netherlands). It consists in a platform of technical support and marketing for small fashion labels and fashion designers with a common interest in green business. Clean & Unique stands for fair labor conditions and environmental responsibility; it is a collective member of the Fair Wear Foundation (FWF): this means, that each member has signed the Code of Labor Practices.

The associate benefit is related to the collective arrangements usable from small adherent companies. Members make use of services and materials that minimize ecological impact whenever is possible and feasible with costs minimization.

Ethical Trading Initiative (ETI)

It’s an alliance of companies, trade unions and voluntary organizations. The secretariat is in the UK, but it is formed by several corporations, international unions and NGOs from different Countries.


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Its aim is to stimulate partnerships among different actors to improve livelihood of workers; companies adherent to the ETI adopt the Base Code, which is the Code of conduct based on the ILO labor conventions. 2 Spanish organizations adhere to this standard; 0 in Italy and France.

The ETI guarantees a marketing support to companies adhering to the Base Code, with a gain for the access to supply chains that reward / demand this kind of initiative.

EURATEX and COTANCE initiatives

EURATEX is the European Apparel and Textile Confederation, the non-profit trade organization of textile/clothing sector; COTANCE is the Confederation of National Associations of Tanners and Dressers of the European Community the representative body of the European Leather Industry. Both have their headquarters in Brussels. Their mission is the promotion of the interests of textile/clothing and leather enterprises while taking into account the European Union's institutional framework and its international obligations.

Members of EURATEX are the main EU national trade association of textile/clothing sector: in Italy Federazione Tessile della Moda, in France Union des Industries Textiles and Union Française des Industries de l'Habillement, and in Spain Consejo Intertextil Espagnol.

Members of COTANCE are the main EU national trade association of leather sector: in Italy Unione Nazionale Industria Conciaria, in France Fédération Française de la Tannerie-Mégisserie, and in Spain Confederación Española de Curtidores.

Many are the initiatives carried out by EURATEX and COTANCE are in the field of CSR, above all concerning the environmental protection; examples of promoted policies concern:

� Chemicals - promotion of information exchange, transparency and continuous improvement of health and safety;

� IPP - promotion of environmentally friendly products and production methods; � IPPC - to achieve integrated prevention and control of pollution arising from industrial

activities Europe wide; � EcoLabel promotion - to promote the design, production, marketing and use of consumer

products and services that has reduced environmental impact during their entire life-cycle; to provide consumers with better information on the environmental quality of products and services

These principles are diffused in the sector by participation in several projects in which EURATEX and COTANCE involve textile/clothing and leather enterprises, supporting them in the experimental adoption of innovative technologies and managerial tools for minimizing their environmental impacts (and, consequently, the risks connected with legislative non – conformity).


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INITIATIVES IN ITALY

Consorzio “Vera Pelle Toscana Conciata al vegetale”.

The Genuine Italian Vegetable - Tanned Leather is a consortium of Tuscan tanneries that revived the ancient technique of vegetable-tanning and that today continue to produce vegetable-tanned leather in its complete process. The Consortium’s aim is to promote the concept of 'vegetable tanning' and to keep the Italian vegetable-tanning tradition alive, exalting the environmental quality of this kind of processes. 30 are the organizations adhering to the Consortium: 26 tanneries and 4 enterprises adopting products by certified tanneries.

The participation to this consortium gains the access to the use of the Consortium trade mark “Pelle conciata al vegetale”; this mark implies the certified origin of the product (Tuscany), that it has been made with respect for the environment, guarantees the naturalness of leather, ensures the high level of the tanning process in full respect of the rules UNI 10885. The consortium, also by public initiatives, promotes this trade mark on the market.

CENTOPERCENTOITALIANO trade mark

It’s a national consortium constituted by a large a group of Italian producers specialized in “leather goods” whose aim is that of safeguarding the Made in Italy trade mark, and its own tradition. In particular the consortium aims at promoting the superior quality and social ethics of leather goods produced in Italy under the consortium’s framework. In addition, it aspires to differentiate Italian products to those produced elsewhere or those that are only assembled in Italy. The respect for social ethics and the differentiation in respect to the job conditions represent one of the most important values of the consortium.

The consortium (grouping 36 tanneries) provides a wide array of services (managerial, legal, financial, etc) to the enterprises. The adherent enterprises can use the ‘100% Italiano’ trademark, which certifies that the product was made entirely in Italy.

SERI.CO Trademark

SERI.CO is a sectorial warranty trademark that guarantees the quality and the adherence to health and safety parameters of a fabric and its production system. The mark is issued by Certitex srl, an independent certifying body, specialized in textile and clothing. The certification procedures therefore offer maximum guarantee of impartiality and transparency giving the mark more value. The Seri.co trademark can only be applied to finished garments. It is a total quality trademark (containing also ethic requirements) focusing on Italian producers which have their headquarter and production plants in Italy. 58 are the enterprises adhering to this trademark.

Many are the benefits for certified enterprises: consultancy; updating about relevant subjects for the company throughout meetings, trainings and seminaries; discount on tests; discount on Oeko – Tex certification; promotion of the company in SERI.CO web site.


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EMAS APO – EMAS Homogeneous Productive Ambit

This is an initiative promoted by the Italian EMAS/Ecolabel Competent Body concerning the application of EMAS – Eco Management and Audit Scheme (Reg. CE 01/761) at cluster level. The Italian EMAS Committee has approved a document specifically dedicated to EMAS application in industrial clusters; it represents a guideline for a sort of cluster “EMAS registration” aiming at rewarding (with a national APO certificate) those clusters implementing innovative processes of environmental management. The cluster certificate is based on the implementation of a Cluster formalized approach to EMAS oriented to simplify the EMAS adhesion to those enterprises located in the certified district.

This approach aims at implementing common initiatives for SMEs located in the cluster and oriented to obtain, as single organization, an EMAS registration. This approach is constituted by a step by step method, reflecting the phases of EMAS registration and EMS implementation. In this moment, in respect to the fashion sector, two are the clusters on the point of obtaining the APO certificate: the Prato textile cluster and the Santa Croce leather cluster.

Cluster approach to CSR

This approach has been experimented in a EU project promoted by DG Enterprise and Industry and aiming at promoting the diffusion of CSR related tools amongst SMEs operating in industrial clusters. By the involvement of intermediary institutions, the initiative favored the creation of local working groups (with local public and private actors) in order to simplify the implementation of CSR related initiatives by SMEs of the characterizing sector (such as drafting of Social Accountability Reports, implementation of Social Responsibility Management Systems, Environmental Management Systems, Safety Management Systems, and so on).

This approach aims at simplifying the adoption of CSR initiatives by SMEs (characterized by a lack of human and economic resources) operating in industrial clusters. In this moment this approach has been experimented in the Santa Croce leather cluster and in the Empolese - Valdelsa clothing cluster.

INITIATIVES IN SPAIN

Made in Green – (Textile supply - chain in Valencia)

Made in Green is a trademark promoted by AITEX (Asociacion de Investigacion de la Industria Textil en la Comunidad Valenciana ) and certifies that the textile product, along the whole supply-chain, has been made in the full observance of environmental laws and human rights. Main requirements of Made in Green are the following ones:

- conformity to Oeko®Tex Standard 100

- conformity to ISO14001 or EMAS requirements

- conformity of productive sites to CCRS-AITEX standard (whose requirements are the same of SA8000)


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The trademark is publicized by AITEX and enterprises can use it in their marketing policies. 43 are the enterprises of textile/clothing sector adopting this trademark.

Distintivo de Garantía de Calidad Ambiental

It’s a trademark of environmental quality promoted since 1994 by the Catalan Government. The trademark guarantees clearness and transparency of information in terms of level of environmental impact and promotes the eco – design, production with low environmental impact and sustainable trade and consumption, defining for a panel of 27 products and services (among which the textiles) specific criteria of conformity. The system is managed at regional level by the General Direction of Environmental Quality of Regional Department for Environment and building industry.

This trademark is important because it’s promoted directly by a Local Authority; the enterprises can use it to guarantee their environmental performances in front of public actors and market. In this moment only 1 enterprise of the textile/clothing sector use this trademark.


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1.c Experiences: THE GUCCI AND FILTEA - CGIL EXPERIENCE

INTRODUCTION

This part of the Report analyzes the GUCCI experience on Social Responsibility. The experience started in the 2004 after an agreement between GUCCI, one of the most important Italian fashion brands, famous all over the world, and FILTEA - CGIL, the national sectorial trade union. This experience is an innovative example of supply chain management sustainability-oriented aimed at monitoring the entire supply chain, carried out by a cooperative approach between the Direction of the world wide fashion brand and the trade union delegation.

This report represents the synthesis of meetings organized with the CSR Manager of GUCCI S.p.A. (Dr. Rossella Ravagli) and the union leader for CSR policies of FILTEA - CGIL (Mrs. Cristina Settimelli), those evidences emerged from documents supplied by both parties and from activities outcomes. This section, on the one hand, aims at describing the performed activities in order to retrace steps and tools implemented in the process of attainment of purposes; on the other hand, It aims at represent the impressions of those actors directly involved in this process and, finally, provide evidence of the competitive results attained and those expected in mid term.

We would like to acknowledge the participation, support and willingness of GUCCI S.p.A. and FILTEA – CGIL.

THE AGREEMENT GUCCI-FILTEA - CGIL: THE PATH AND THE OBJECTIVES

The years between late 1980s and beginning of 1990s was characterized by strong process of externalization in the fashion sector.

Initially during this period, the output of production phases was characterized by local boundaries. However, the effects of globalization, pushed the boundaries further, forcing firms to delocalize production past national boundaries.

Trade unions needed to find out a way to reform the value chain, from the trade relations perspective, characterized by the supply chain and from the impacts on human rights caused by these relations.

A growing engagement on the product traceability is developed in the workers organization for the modification of product processes.

The first difficulties to emerge are about the effort to return that theme at corporate governance to integrate the processes decision making with these themes.

Since the new millennium, a growing interest around “ethic” products and handmade products started to became popular in Italy as well as other parts of the world. Consumer pressure, amongst other factors, forced companies to look for solutions for those demands. Initially, this can be translated by the adoption of codes of conduct, followed by certification process and CSR management programs.


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However, this process was not straight forward. Numerous experiences were not proactively supported by the involved stakeholders (trade union and unitary union representation). In spite of this, the consumers increasing interest, the engagement of the textile trade union and the interest of some companies represented, from the beginning, one of the main challenges and produced a more attention at the way how these instruments can be adopted and can spread and at the necessity to ensure credibility at the instrument.

In the 2003 in the Florence province, the textile trade union, in particular the FILTEA - CGIL, started a framed reasoning on the importance of stimulating companies on the social quality of their production in order to face the international competition as total quality. The idea behind that was to strength the unity of their members independently of their location. From this point of view the trade union chooses to adopt the SA8000 standard in the bargaining. This standard assures a minimum set of rights, sanctioned by ILO are respected in all company supply chain. Therefore, companies became responsible for their workers conditions throughout their chain.

Around the same period, the Tuscany Region, intended to legislate CSR, what demonstrated a significant institutional interest on the theme. These events took place in 2006.

Also the Italian Government was giving particular attention on sustainability themes meaning on labor ethics, on safeguard human rights, on environmental safeguard.

In this context the idea of an agreement between GUCCI and FILTEA - CGIL concerning these items flourished. In that period a group of GUCCI management started to demonstrate a high interest on theme of the supply chain management with a progressive approach to the CSR formalized tools. These tools allow defining appropriate ad effective check system and supply control.

The common interests between GUCCI and the trade unions, and the advanced union relationship, represented the base for the sharing of a common path on CSR theme in the sphere of supply chain management. This contest lead up to the first draft of the agreement (Protocol of Agreement) in June of the 2004, and latter on 8th September 2004 the final agreement was signed.

The agreement Brought about several novelties, whose the most interesting are:

� GUCCI identifies the trade union as the favor interlocutor on these themes, through the constitution of an equal committee. The committee had the role of ethical guarantee, of certification process’s transparency and of control of the whole processes to be implemented. This is an important result: the Trade Union is recognized as a useful stakeholder, because has the access to all the information about the group chain in total transparency. The trade union is in partnership with the company to guarantee the ethical and environmental quality of productive processes.

� GUCCI identifies the SA8000 certification as a tool to transfer the CSR culture to the SME in the chain, but without impose the culture. Starting from the group leader to extend to all the production chains with GUCCI brand.

� finalizing the SA8000 tool to involvement and accompanying processes of chain companies in order to ethical behaviors. This doesn’t schedule a punitive attitude towards SMEs of the chain but it favors the return to regularity conditions in established times and in accordance with the agreement protocol. If problems emerge with suppliers, GUCCI


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reserves the right to maintain a business relation with the company, under condition that it prepares appropriate tools to correct irregularities.

� agreement to make controls on the companies by the auditor accredited by SA 8000 standard assuring the law compliance in the field of job contractual regulation and of health and safety.

THE PATH FROM THE 2004 UNTIL PRESENT

GUCCI first step of the adoption CSR tools process was the implementation of social responsible management adequate to the SA8000 standard.

The ethic committee first decision was a wide information and internal awareness campaign to spread the CSR culture and to increase knowledge awareness in the company about the values, the objectives and the expected results of the initiative. It was implemented through careful work with the staff, to involve it and to make it aware on these themes. A joined meeting between representatives of the trade union and management was organized, newsletters was sent to employees with their pay slips were sent, and training courses planned and implemented. All these initiatives focused on CSR themes.

After this first phase, a program of involvement/awareness of actors operating in the supply-chain (suppliers and sub vendor) was developed. Initially they were informed about the path selected by GUCCI, through the sending of a written communication that explained the choice made by the GUCCI management and the CSR principles; successively they were involved in a seminar where the underwritten agreement was explained, with detail of opportunities and added values.

After training courses and information campaign, GUCCI started the first sample checks in the suppliers. The audit reports were always shared in the ethic committee and each time were chosen times and ways of non-conformances management.

Besides the supply-chain ethic management, GUCCI decided to implement also a Social Responsibility Management System in accordance with further SA8000 requirements. The SA8000 certification was obtained in July of 2007. The choice of the SA 8000 certification was based on the management wish to adopt a tool which was not perceived as self referential (e.g. Ethic codes). SA8000 is a managerial tool that need an independent audit and it fitted the contents of the 2001 Green Paper on CSR by European Commission (Promoting a European framework for CSR, DG Employment and Social affairs). The good internal business relation and the relation with the trade union favored the start of a structured path on these themes.

The plan of control over the production chain has been structured according to a schedule providing a breakdown by sector of activity:

• 2007: start of activities on the sector of leather goods and jeweler • Early of 2009: footwear • Late 2009: clothing

By the end of 2010 the goal is to involve all categories of products and stores in a process of adaptation to the requirements of the SA 8000 standard, moving towards the concept of genuine total quality (not only products but also ethical and environmental) through a tiered approach to membership of the scheme.


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ETHIC SUPPLY - CHAIN MANAGEMENT

In the supply chain management by GUCCI there are some important aspects:

a) Suppliers mapping: the process of development of its CSR program, the first important moment was the identification and classification of suppliers. The adopted criteria were different: geographical location, field of membership (type of product), the amount of work that the supplier has with GUCCI (and hence the level of commercial importance of the supplier), criticality of the situation of sub-sector where it operates (with reference to the ethics of labor relationships), quality of production.

b) Audit: the second phase was the definition of tools for supply chain monitoring and control, on the basis of risks resulted by mapping. Three are the main tools:

� Third part Audit: the independent auditor carries out the verification activities in GUCCI and in a number of annually fixed suppliers. The control system provided by SAI - Social Accountability International - was very refined in recent years and, for example, at least one review in the audit cycle period (3 years) must be unannounced (it is a SAI requirement, both directly on the audited company and on the firms in the supply chain)

� Second part audits: they are planned and carried out by GUCCI on companies in the supply - chain. Since 2007 over a thousand inspections have been performed; they have raised the awareness of the supply chain and continuously stimulated the adoption of ethical behavior. Monitoring allows the firms to correct and work over time in terms of prevention. Checks carried out by GUCCI are not scheduled.

� Reports from interested parties (among which a prominent role is played by FILTEA). In the event that a third interested party reports irregularities to a situation of a firm, the attention of GUCCI is particularly high both for the importance that the reactions are to take in terms of maintaining relationships with various stakeholders, and for the high probability that it is highly critical situations (e.g. workers are not in rules, hidden laboratories, etc.).

Where irregularities are detected, the attitude of the company (unless situations of extreme lawlessness) is to try to accompany the firms towards a process of improving of their behavior, taking no punitive actions. If irregularities continue, the commercial relationship is terminated (situations of relapse).

c) Training / information initiatives: these are initiatives addressed to the suppliers in the supply chain. A training and information plan identifies the firms to be engaged; these subjects are addressed seminars and training opportunities. In these occasions GUCCI emphasizes business opportunities related to the adoption of these tools and the added value that can result from their commitment (both direct benefits to the suppliers, and indirectly for GUCCI). The basic idea is to provide management tools for social responsibility, through the involvement of all stakeholders in its implementation.

With reference to the above recalled, an interesting example comes from the leather and footwear industries. In these areas, the process of progressive introduction of the monitoring system is currently in progress. Recently, a mapping of the process has been carried out and an information


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seminar has been held on SA8000 and Social Responsibility: in this occasion the President of GUCCI (an indicator of the high commitment) was present and introduced the meeting. Subsequently letters were sent to the suppliers in which they reaffirmed the commitment and importance of what the brand intended to pursue wanted to pursue, and then specific training and information activities directed to small groups were organized and carried out. The following step was the finalization of the auditing plan, currently in progress. The whole process has been conducted continuously informing and involving the trade union. A positive result so far has been obtained is the interest shown by many providers with respect to SA8000 direct certification

THE ORGANIZATIONAL STRUCTURE AND INTERNAL RELATIONS

From an organizational perspective GUCCI counts with a dedicated CSR manager, which is responsible for identifying and monitoring socio-environmental impacts, managing the certification process, and leading all governance processes relating to the wider social and environmental responsibility that may affect the company. The CSR Manager is allocated in the Human Resources Department. This figure has as a major managerial role to communicate in a transversal way with all other sectors and processes of the organization, and to create networks within the company.

The Company currently has an ethical code and a SA8000 certification that it is expanding to all business segments. An example of this process of gradual extension of the culture in the Company is the ongoing work with various corporate departments, including the Supply Chain Department, Safety Department, Quality Control Department, aiming at integrating completely the considerations related to CSR into their decisional processes.

CSR AND COMPETITIVENESS

The idea behind the strategy on CSR by GUCCI is the quality, understood as a quality product in the total sense. The impression (shared by both contacts: Company and Trade Union) That as a result of the current economic crisis, a revival of these issues and values will be revived. In particular may take on a certain importance to the territorial dimension of production, the specific areas of origin of production and aspects of tradition that characterize these contexts. The sustainability can really become a competitive winning factor, a real element of differentiation. Globalization tends to standardize processes, and to stand out in the market it is essential: this is the business strategy that supports the choice of CSR in GUCCI.

The territorial dimension, as anticipated, is particularly interesting; in a production system with industrial districts, promoting a virtuous behavior on the ethical business by GUCCI supply - chain means increasing the competitiveness of the entire sector.

In particular among the areas where GUCCI believes it can claim to have found benefits for themselves and for companies in the sector we can found: an increase in the motivation of its staff and of the staff of the companies involved in the CSR processes, improvements to working conditions for the workers in firms’ sector, also validated by external institutional sources.

Of course, being the whole process in consultation with the trade union and following the desires of Tuscany Region in CSR field, the positive effects on institutional relations and trade unions have been important since the beginning, and a desire to strengthen the existing climate of collaboration.


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One area however where GUCCI considered appropriate having more investments in the next years is the enhancement of its commitment in terms of external communication, and commitment to new targets in the environmental field.

Finally, unanimous opinion between GUCCI and FILTEA - CGIL is that the role of public subject in promoting CSR is essential: Tuscany Region has provided significant financial resources and has invested significantly in training (with Fabrica Ethica Project). After all in these processes the dissemination of culture is to be considered crucial; address and capacity of the public system to reward these choices are considered essential to their widespread.

CONCLUSIONS

GUCCI represents an emblematic example of a harmonized process of CSR - related practices implementation in accordance with one of the main sectorial trade unions, not characterized by a necessity of image recover. GUCCI chose the adhesion to certification systems with a process of agreement with FILTEA – CGIL, not because there were scandals, but because it met a specific commercial and social strategy. The Trade Union, on the other side, was involved in this experience to modify its traditional approach of accusation, accepting the direct involvement in the agreement.

The current CSR oriented policy aimed at improve the performance of the supply chain, has already significant results. In particular, the conditions of many suppliers in the sector of leather goods has improved remarkably in terms of health and safety, and also the audits made by the ASL have shown a relevant improvement. This brings benefits to all stakeholders of the fashion system, albeit from an economic standpoint, this advantage has not yet been measured. Looking forward the idea of GUCCI is to achieve a genuine process of stakeholder engagement, guided by a committee where the Trade Union FILTEA (partner in this initiative) is a key player and proponent of policies to involve companies of the supply chain.


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2. MARKET DEMAND SIDE ANALYSIS

The second section of this report concerns a marked demand side analysis of which firms in the textile, clothing and leather sector are subjected to. This analysis is supported by a review of the literature and a collection of evidences draw from firms operating in those sectors in Italy, Spain and France. The academic literature review has provided evidences that consumers’ behavior has been changing in recent years. There is a growing awareness of firm’s behaviors and greater importance is given to ethical practices (Uusitalo & Oksanen, 2004). According to an EUROBAROMETER (2009) survey, the majority of interviewees affirmed that product’s environmental impact is an important element when selecting products. Moreover, product’s impact is viewed as a more important characteristic than brand when buying. However, price and quality are still the leading points when making purchase decisions. Nevertheless, the analyzed literature points out that customers awareness about product’s impact and ethical consumption are increasing. Nickolls (2002), had identified a huge growth in the UK retail market for fair trade products. Notwithstanding, several barriers on social responsibility still need to be overcome. Studies (IPSOS MORI , 2007) argued that firms should use CSR to gain competitive advantage and brand-equity, appealing to more conscious consumers. On the other hand, a Swiss researcher (Meyer,2001), argues that companies should not focus only on green oriented consumers, but should use clothes’ green aspects as a complimentary strategy to market logic (design, quality, price, etc). Furthermore, an OECD (2007) publication identified that in several cases, a gap between what consumers answer about ‘how much they care’ for CSR and their actual purchasing behavior exists. This study confirms findings from a UK (Morgan & Birtwistle, 2009) research which identified that a large percentage of young population (15 – 24 years) does purchase a large share of their clothes from fast fashion retailers, which sell cheap clothes, even though the majority of interviewees declared themselves concern with the environment. Although, the literature does not focus only on SMEs and firms from textile, clothing and leather sector, it support the identified trend of increasing consumer awareness about ethics and firms behavior which may influence their purchase decision making. In addition, it could stimulate more firms to adopt CSR initiative and tools in order to increase their competitiveness. As demonstrated by evidences collected in Italy, Spain and France, some firms are already responding to consumers pressures and demands. Some of the encountered evidences had provided a truly global scope of demand side concerns. As the suggested by the evidences, large retailers have already implemented codes of conduct or regulations in order to guarantee their clients with responsible and ethical products. Clearly this is only the beginning of a true responsible sector. As demonstrated by best practices, the great challenge faced by retailers seems to be related to the lower levels of the supply chain where production process is pulverized amongst SMEs. Some of the initiatives described attempt to lock suppliers in by demanding the adoption of ethical codes or norms and auditing their whole supply chain in order to guarantee the responsibility of their goods. . From a methodological point of view it’s important to notice that, in the identification of the evidences, we’ve evaluated the credibility of the described firms, brands and retailers, looking at the opinion of important sectorial NGOs committed in the field of social responsibility. In particular we’ve excluded those “names” considered by Clean Clothes Campaign (www.cleanclothes.org) socially irresponsible or involved in scandals.


References Description of contents CSR tools mentioned

Conclusions

Outi Uusitalo, Reetta Oksanen (2004)

Ethical consumerism: a view from Finland

International Journal of Consumer Studies,28,3, June 2004, pp214–221. School of Business and

Economics, University of Jyväskylä, Jyväskylä,

Finland

The purpose of this paper is to investigate ethical consumerism from the perspective of final consumers. The trend towards globalization places a new emphasis on the responsibility of the individual consumer. Consumers require social responsibility from corporations. Ethical consumerism addresses the social and environmental consequences of global trade. Ethical consumer choices are also becoming a factor in consumers’ lifestyles. As a result of global competition, consumers may prefer also locally manufactured or traditional products because of their safety and familiarity. Ethical and sustainable business practices are an important competitive advantage where consumers value and rely on them. Giving a report of ethical and unethical firms, the authors look on the textile and clothing sector.

Marketplace CSR (stakeholders

information on firms’ products)

The results of this study indicate that final consumers consider important ethical practices in production and trade. The majority of respondents state that a firm’s business ethics influence their decision making. The respondents considered stores, manufacturers and importers to have a very important role in informing the public about the ethics of firms and products. Stores can affect consumers’ decisions at the moment of purchase. Consumers are often uncertain about which firms act ethically and which act unethically: they almost consider the firms stereotypically unethical. The earlier studies suggest that negative information about unethical actions has a stronger effect on consumers’ attitudes than positive information about ethical actions.

Clare D’Souza, Mehdi Taghian, Rajiv Khosla

(2007)

Examination of environmental beliefs and its impact on the influence

of price, quality and demographic

characteristics with respect

With increasing stakeholder demands (especially consumers’ pressure on protection of the environment), businesses have moved beyond simply addressing environmental regulatory issues and are introducing alternatives such as new products that are classified as green. Some businesses have developed environmentally friendly packaging or implemented cause-related promotions. However, at present, businesses find difficulties to predict consumers’ reaction towards green products with a degree of

Environmental related CSR

The analysis provides the motivations for management: (1) to build a strong competitive advantage for the product, in terms of quality and price, (2) to develop and project a profile of green consumer based on demographics (3) to meet customers’ expectations by genuinely being as well as effectively being recognised by consumers as being demonstrably socially responsible. This strategy may offer the potential benefits of improvement in market share and assist to achieve


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to green purchase intention.

Journal of Targeting, Measurement and Analysis for Marketing Vol. 15, 2,

69–78

accuracy that is necessary to enable the development of new targeting and segmenting strategies. This element presumably has contributed to the failure in green products development. The research’s aim consists in an understanding of green consumers and their characteristics. Issues that have increasingly induced the slow development of green products are strategic issues stimulated by businesses, such as charging higher prices or constraints on quality measures for green products. In this paper, the authors investigate and detail the design of a soft computing model using Kohonen’s LVQ technique for predicting the consumers’ purchase intention of green products. The study doesn’t consider specifically only the textile sector, but is generally related to green productions.

sustainable longer term profitability

EUROBAROMETER Research (2009)

Europeans’ attitudes towards the issue of

sustainable consumption and production

In this research, 26640 EU citizens (plus Croatians) have been interviewed about their ways of products selection in respect to their consumption choices. Slightly more than 80% of EU citizens answered that a product’s impact on the environment is an important element when selecting the products to buy. A product’s impact on the environment was viewed as more important than the brand, or brand name. The environmental impact, nevertheless, appeared to be somewhat less important than a product’s quality or price. Another variable analyzed

Environmental related CSR and Certifications

- The 55% of respondents, who are fully aware of the environmental impact of the products they buy or use, said that this aspect is very important in their purchasing decisions - This proportion decreased to 27% for those admitting knowing nothing about the impact on the environment of the products they buy or use - Two-thirds of respondents considering important the environmental impact of the products, said that Eco-labelling plays an important role when they decide their purchases (showing a high level of awareness about the environmental impact of the products they


53

concerned the Ecolabelling, and the perceived role of it in the purchasing decisions. Finally, an evaluation concerning the adoption of green codes of conduct by retailers, has been requested to the interviewed citizens. This research was not focused on a specific sector, but it considered in general the consumption tendencies

buy or use) - The Eco-labelling is considered less important for those regarding the environmental impact rather not important or not important at all. - Four out of 10 EU citizens agreed that it is a good idea to develop a voluntary environmental “code of conduct” for EU retailers. A similar proportion, nevertheless, thought that binding legislations would be more effective.

Pratima Bansal, Kendall Roth (2000)

Why companies go green:

a model of ecological responsiveness

Academy of Management Journal. Vol, 43. No. 4,

717-736.

The authors conducted a qualitative study of the motivations and contextual factors that induce Corporate Ecological Responsiveness. They examined why some firms embrace ecologically responsive initiatives, while others in similar circumstances do not even comply with existing legislation. The authors consider in the analysis also SMEs (but not exclusively of the textile/clothing sector). Several studies identified motives for corporate "greening," such as regulatory compliance, competitive advantage, stakeholder pressures, ethical concerns, critical events, and top management initiative. They coded variables that included cost reduction, increasing market share, reaction to competitors, reaction to consumers, building resources, survival, legislation, avoiding penalties, license to operate, managing risks, doing the right thing, and avoiding personal risk.

Environmental related CSR,

Marketplace CSR and Certifications

Motivations for Ecological Responsiveness: it costs nothing to do it, and it's:

� the right thing to do from enterprises standpoint � the right thing to do from the consumer's

standpoint.

Key Dimensions Differentiating Motivations: it is a problem of providing something that the consumer really wants, with the aim of increasing the market share. Several respondents indicated that if environmental science was more definitive in assessing the ecological impacts of alternative activities and if consumers were more demanding, then they would more likely show more ecological.

And community Ricerca “Ipsos MORI” (2007).

The survey aimed at discovering the global attitudes about climate changes. In particular, it examined how the climate change are considered

Environmental and community related

The research underlines the importance for the enterprise to have responsible environmental behaviours to increase the “corporate brand equity”


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“Buone prassi e impatto sui Brand Values”

Tandberg - B&P communication

by consumers and employees. It wants, also, to discover the efforts of the companies to become more responsible. More than an half of the global interviewed consumers said of preferring to buy products and services from a company with a good environmental reputation. Almost the 80% of the global employees consider important to have a job in an ethical organization committed to the environmental protection. More than an half of interviewed is mined to buy products and services from an enterprise with a good reputation about environmental responsiveness.

CSR, Certifications and the “competitive advantage”. For example the developing of new technologies “environmentally friendly” is suggest as fundamental factor to have an increasing environmental responsibility in the company. The survey evidences that in the future lots of companies will stop to ignore their roles in respect to their contribution to the climate changes, because on the contrary their performances will be at a loss.

Fabio Iraldo (2000)

“Ecoinformazione a regola d’arte”

Largo consumo, 20 (10), pp.195-197

This article is about the ISO 14021standard – Environmental Labels and Declaration. The objective of the standard is to promote and favour the harmonization of “ environmental claims” by new tools such as the Environmental Product Declarations, aiming at guaranteeing the environmental characteristics of the products in an ecological marketing perspective. The information have to be: clear, accurate, specific, relevant, substantial (fitting with the situation and its objectives), reliable, comparable, visible.

Environmental related CSR (ISO14021)

The development and the diffusion of the standard, in the intention of ISO, could allow to consumers a more conscious and informed choice. It wants to guarantee a correct competition among the producers actively engaged in these themes.

R. Lucchi (2009)

“La marca partner. Il nuovo patto”

The perimeter of ethical values satisfied by the brand is changing. Since not much time ago the brand had to satisfy four guarantees: quality, safety, environmental respect, fair treatment of employees. Now another variable is considered


This paper evidences a big opportunity for who gives attention to the demand petition. The article clarifies that, in an outlook without answers, also a little answer has a big consequence. It emphasizes the importance of non-economical variables in this particular global


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Social Trends n.107 Gfk Eurisko.

important: the quality of the relationship with the consumer. Because of this, there is an attention not only for the brand product but also for the consumer’s welfare. The consumer requires also sustainability but at the moment the sustainability initiatives aren’t numerous. The consumers feel the right to require more and more.

phase, and the role that in the economical relationship can be played by trust. The author ends the article underling how the SMEs can answer to new consumers’ behaviours.

Fliess, B. et al. (2007)

"CSR and Trade: Informing

Consumers about Social and Environmental

Conditions of Globalised Production: Part

I", OECD Trade Policy

Working Papers, No. 47, OECD Publishing.

doi:10.1787/246322000033

This study investigates how consumers are informed about the social and environmental conditions under which products have been produced. Consumers of OECD increasingly attach importance to how companies buy from conduct their business, and the voluntary adoption of CSR policies is spreading in the private sector. But how do consumers know if producers and sub-contractors collaborating within global supply chains meet given standards? The paper identifies four major information strategies through which consumers obtain information about social and environmental production conditions: certification and labelling, corporate reporting, consumer guides and corporate marketing. As markets become more concentrated the growing power of large buyers and the crucial role of effective communication in helping bridge the observed gap between consumers’ attitudes and purchase behaviours, but also the challenge and potentially trade-limiting impact

Community related CSR, environmental

related CSR

The survey data reviewed for this study suggest that consumer demand for CSR products could grow if ways can be found to bridge the gap between stated interest and preferences on the one hand and actual behaviour on the other one. The research confirmed the existence of a gap between what consumers say about how much they care about CSR and their actual purchasing behaviour. This study found that for all sectors surveyed, products are available in the marketplace which originate from production controlled by private voluntary social and/or environmental standards. Often, these products are not identified to shoppers as such. For instance, many European consumers would not know if the flowers they buy were produced in observance of social and environmental standards. This can be explained in part by the fact that for major intermediary buying associations adherence by suppliers to standards for CSR production is more relevant than informing the final consumer at the end of the supply chain about these high standards and that some producers cannot financially afford to engage in


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resulting from the increase in and diversity of private social and environmental production standards. It’s important to notice that this paper doesn’t focus on the three countries of our research, but it’s an interesting approach good also for them

marketing their CSR-proof products at the consumer end. Making CSR visible to consumers hence remains a challenge for companies and other stakeholders.

Morgan, L. R. and Birtwistle, G. (2009)

An investigation of young

fashion consumers’ disposal habits

International Journal of

Consumer Studies 33 190/198

The demand for cheap fashion is high, and the fast-fashion clothing market has grown significantly in response to this trend. Fast fashion has gained market share recently and now accounts for one-fifth of the total clothing market in the UK (Defra, 2008a). This phenomenon has led to consumers purchasing and disposing of ever-larger quantities of clothing. A study of young males and females between the ages of 15 and 24 reports that 38% shop at Primark, 35% at Topshop/ Topman, 33% at New Look, 31% at River Island and 24% at H&M (Keynote, 2008). The purpose of this paper was to examine the purchase behaviour and disposal habits of young consumers and suggest ways in which fashion consumption could become more sustainable. Also this paper doesn’t focus on Italy, Spain and France.

Marketplace CSR (product

information and consumer

communication)

The findings of this study reveal that young female consumers are unaware of the need for clothing recycling. However, they agree that there is a general lack of knowledge of how and where clothing is disposed of, or even how it is made, such as the environmental consequences of artificial fibres and intensive cotton production. This lack of awareness is thought to be a result of lack of media coverage. Participants also stated that they might consider modifying their clothing consumption and disposal behaviour if they were more aware of the social and environmental consequences. Overall, there is concern about the environment, but there is no correlation between awareness of the environment and textile disposal behaviour and the attitude to textile reuse and recycling. Fast-fashion retailers now need to take responsibility for the amount of fashion clothing sold through their stores by instigating programmes in terms of textile disposal methods similar to those implemented by Marks & Spencer to increase the reuse and recycling of fashion clothing.

Arnt Meyer (2001)

What’s in it for the customers? Successfully

Most green marketing literature is strongly based on the assumption that a consumer’s environmental awareness is a pre-condition for green purchasing.

Marketplace and Environment related

CSR (product information and

This economic approach is based on the assumption that green products are successful only if customers perceive the products as superior to competitors’ conventional offerings. It leads to a positioning and


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marketing green clothes

Business Strategy and the Environment 10, 317–330

While following such a ‘behaviouristic’ green marketing both scholars and companies seem to have neglected that green products are bought only if customers perceive the products as superior to competitors’ offerings. This paper argues that economic theory can give additional valuable input to green marketing. A first important step for marketing according to the economic approach is to identify how consumers perceive the products’ cost and benefits.

consumer communication)

communication strategy in which first of all those added values are stressed that are most admired and preferred by customers. Both the theoretical reflections and the case studies showed that a green product’s environmental superiority does not have to be its core value added. Indeed, looking at the relative importance of most products’ environmental performance as perceived by customers a ‘green-only’ positioning strategy can be rather unsuccessful. In this contribution, cost and benefits components were specified for and illustrated with the example of clothes. Usually, to purchase green clothes consumers have to accept significantly higher costs (especially product price and search cost) and minor benefits (especially visual appearance). The large majority of customers, therefore, refuses to buy those products. According to most green marketing literature, companies should therefore target green consumers, stress the product’s environmental superiority, and fight consumption barriers. In identifying and characterizing their target groups both companies do not look too much at environmental awareness. They rather try to understand what their clients’ most important needs are apart from every environmental reflection. Only in a second step do the companies try to fulfil the needs and to meet their own high-standing environmental goals at the same time.

Freestone, O & McGoldrick, J. (2008)

For a number of years, scholars have argued that a highly principled group of aware and ethical consumers has emerged. ‘Shoppers are highly

Marketplace CSR [Decisional Balance

Scale (DBS) &

The results of this study provide new data to assist in understanding motivations for changes in ethical behaviour. These results provide evidence to support


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Motivations of the Ethical Consumer

Journal of Business Ethics

81:223–234

aware of ethical issues and many are ready to put their money where their morals are’’. Thus, there is an increasing body of evidence to suggest that shoppers take their morals, in addition to their wallets, when they visit the high street. While evidence supports the view that a shift in consumer values is occurring, there is little substantive empirical research that addresses how this motivational process operates. It is this gap in the existing knowledge that this paper seeks to address.

Transtheoretical model (TTM)]

the application of the Decisional Balance Scale for ethical decision-making to measure the positive and negative motivational statements for the population under study. Furthermore they demonstrate that the DBS construct of the Transtheoretical Model has an application in understanding ethical decision-making, as hypothesized from earlier conceptual discussions. The results suggest strongly that changes in ethical behaviour can be effected by influencing the balance of motives. They suggest a conceptually and empirically grounded schema for researching and classifying these motives, offering guidelines for researchers, managers, campaigners and policy makers, with a common interest in better understanding the ethical consumer.

Nicholls, A.J. (2002)

Strategic options in fair trade retailing

International Journal of Retailing & Distribution Management 30, 1:6-17

UK market for fair trade goods has grown enormously in the past five years. Driven by an increase in ‘ethical consumerism’, which embraces consumers’ concerns over environmental issues, the subject has been explored in the literature from three distinct academic viewpoints: developmental economics; business ethics; and marketing. The paper argues that developing a fair-trade offer can provide retailers with both an effective example of good corporate social responsibility and commercial opportunity.

Marketplace CSR

The paper argued that there is a growing market for fair trade products in the UK that is only beginning to be properly targeted by mass-market retailers. Empirical and an academic review of the literature support this view. The paper concludes by arguing that, by engaging with fair trade products, retail organizations can tap into a new and growing market and, in the process, enhance their own brand value.

2.b Evidences

The best experiences carried out in the three countries (Italy, Spain and France) and concerning the textile/clothing and leather sector had been described in the following list; they mainly refer to initiatives promoted by French, Spanish and Italian large retailers which select their suppliers based on their ethical and environmental performances, or promote green and ethic products among its consumers.

INDITEX GROUP (Zara, Pull and Bear; Massimo Dutti, Bershka, Stradivarius, Oysho, Zara Home, Uterque)

Inditex is one of the world largest fashion distributors, with eight sales formats boasting 4.430 stores in 73 countries.

Country: Spain

CSR topic: Labor safety and protection

Short description of initiatives: After the incorporation by Inditex of the Ethical Trading Initiative (ETI) principles in 2005, Inditex aimed at introducing to its Base Code the Code of Conduct for External Manufacturers and Workshops. This new Code is characterized by 11 requirements to be respected: No forced labour, No child labour, No discrimination, Respect for freedom of association and collective bargaining, No harsh or inhumane treatment, Safe and hygienic working conditions, Wages are paid, Not excessive working hours , Environmental awareness, Regular employment. The Code implementation implied that all suppliers and sub-contractors have to adhere to the code requirements; in this sense the external manufacturers and suppliers, which subcontract work for Inditex, shall be responsible for subcontractors’ compliance with the Code. External manufacturers, suppliers and their subcontractors have to apply the Code’s principles to any homewoker involved in their supply chain, and they must ensure transparency about their locations and working conditions. All brands of Inditex Group have to implement and maintain programmes of implementation and training of this Code . External manufacturers, suppliers and their subcontractors shall appoint a senior member of Management who shall be responsible for the implementation and enforcement of theCode. External manufacturers and suppliers and their subcontractors shall communicate the Code to all employees and to their contractors, subcontractors, suppliers, agents and homeworkers if they are involved in the Inditex Supply Chain. In this process the transparency is considered one of the principal ingredients to assure credibility; from this point of view, external manufacturers, suppliers and their subcontractors are forced to allow Inditex and/or any third parties the former might appoint, to carry out inspections and audits in order to verify the appropriate enforcement of the Code. For these purposes, they have to provide the inspectors and/or auditors with the required information and the appropriate access to the facilities and documentation required to ensure this verification. Such a system of selection and evaluation of suppliers creates a relevant selection among the producers, based also on ethical and environmental performances, in order to be part of an important group of distribution with an high market share.


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H&M Group

H & M Hennes & Mauritz AB (operating as H&M), is a Swedish clothing company, known for its fast fashion clothing offerings for women, men, teenagers and children. H&M has more than 1.800 stores in 34 different countries and employs over 73.000 people.

Country: Headquarter in Sweden, but local offices (with administrative autonomy) are in France, Italy and Spain

CSR topic: Environmental and social management

Short description of initiatives: One main feature for H&M is represented by environmental protection, by the means of “Cleaner fabric production” initiative. To contribute to cleaner fabric production, H&M tried to encourage the dye houses to take environmental considerations into account in their activities. The process involves H&M’s auditors visiting the various facilities to assess the potential of improvement and to demonstrate possible actions that can be taken; the final target of this policy, in a long term view, is that of guaranteeing a compete environmental monitoring on the supply chain.

Also from an ethical point of view, the policy promoted by H&M is oriented at controlling suppliers and sub-contractors to avoid employing child labor or young workers. In case of non compliance from suppliers, they act according to their policy: the family is contacted and in most cases the family accepts that the child should continue to work with some kind of education until he or she complete 15 years old (or the lawful age for working in the country in question, never younger than 14 years). Wages continue to be paid during the period of study so the family does not lose its income. In certain cases, an older member of the household is offered work instead of the child.

With these policies, suppliers SMEs have a commercial stimulus to implement an environmental management system and to better recruit their personnel. Also in this case, the ethical and environmental performances are criteria for entering a large channel of trade.

ARMOR LUX

Armor Lux is a 70 year-experience French fashion group employing 640 persons, three factories and a network of 30 boutiques; its production is inspired by the colors of the sea and values from Brittany. It is also a company that has relied on the made in France quality production mark and which promotes a unique know-how in the textile/garment field.

Country: France

CSR topic: Drafting of a charter of socially responsible behavior; it regards the social and environmental fields

Short description of initiatives: Armor Lux promotes a social responsibility charter in which the company commits itself to:


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- comply with social regulations both at national and international level;

- promote sustainable development among its activities (particularly in economic, social and environmental fields);

- follow the standard “fibre citoyenne” and demand its partners and suppliers the respect those same principles

In January 2004 Armor Lux signed the United Nations’ Global Compact charter, inviting companies to endeavor respecting a set of fundamental values in the fields of Human Rights, work and environment.

Armor Lux is a member, since 2004, of the Comité 21 (French Council for environment and sustainable development) and hence has committed itself on 5 points for the following 10 years:

1. adopt responsible production and consumption habits and reduce carbon dioxide emissions 2. contribute to preserve bio diversity and promote sustainable tourism 3. respect cultural diversity and fight against exclusions 4. support environmental channels and social economy 5. reinforcement of international solidarity

In the field of ethical productions, since January 2005 Armor Lux signed a license contract with Max Havelaar (France) permitting the marketing of garments made of fair-trade cotton. Since 2005 Armor Lux is a member of the ORSE (Study Center for Corporate Social Responsibility) and regularly takes part in work groups on territorial anchoring and responsible purchases. Finally, Armor Lux adhered, again in 2005, to the citizen fibre programme implemented by the NGO Yamana, promoting a fairer economic, social and environmental development.

The ethical and environmental principles followed by Armor Lux represent requirements to be respected by supplying firms; therefore Armor Lux creates a selection among its suppliers based also on ethical and environmental requirements.

AUCHAN GROUP

Auchan is a French international retail group and multinational corporation headquartered in Croix. It is one of the world's principal distribution group present in 12 countries with 175,000 employees. Auchan has international branches also in Italy and Spain; Worldwide, Auchan has more than 1000 super and hypermarkets and more than 2000 small shops.

Country: France (with locations also in Italy and Spain)

CSR topic: Ethic values and quality principles mainstreaming


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Short description of initiatives: For the Auchan Group, CSR represents the mean for sharing its ethical values with institutional interlocutors and commercial partners. Auchan establishes a concrete partnership with selected companies; the group invest lots of energy and resources in these partnerships, providing know how and support to partners when adopting efficient quality management systems. The group add value to its suppliers allowing them to associate themselves to one of the most important large retailer in Europe.

Auchan, after selecting its suppliers, develops an “entrepreneurial valorization” to make sure they fit with the large retailer . In 2001 Auchan constituted a scientific committee with the objective to deepen the ethics, quality and CSR of their commercial partners. The scientific committee is composed by experts in various scientific disciplines and important personalities of the European culture in the field of CSR. Since 2004 Auchan has been member of the UN - Global Compact. Auchan represents big opportunity to local SMEs to become suppliers of the retailer and use the Auchan brand. Thanks to the scientific committee SMEs can learn about CSR themes throughout the large retailing group.

BASI SA (Lacoste, Armand Basi, Ferran Andrià)

ARMAND BASI SA is a textile retail company operating in Spain since 1948. It’s the holder of such label as Chemise Lacoste (since 1962) and Armand Basi (1986). Since 1994 BASI SA started to trade abroad (in 11 countries) and since 1995 it open its own shops around the world.

Country: Spain

CSR topic: Labour and human rights protection; ethic supply - chain control

Short description of initiatives: The Group signed a code of conduct for suppliers about employment contracts, aiming at asserting the principles of protection of Human Rights (i.e.: no discrimination, security and safety of workers, guarantee of minimum levels of wages, prohibition of child labour, protection of health of young workers, and so on).

The inspections carried out by this Group are internal and external. Internally they implement specific procedures whose adoption is verified by internal auditors; the second control regards the labour condition of employees in some specific Countries where SMEs are located, such as: China, India, Portugal and Peru.

There is also a Corrective Actions Management System if the auditing process discover a breach in labour rights. This system implemented by BASI SA gives the possibility to guarantee good conditions for workers or to correct wrong attitudes of suppliers. These elements aim at intensifying the relationship between BASI SA Group and suppliers, based on the mutual trust.


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Group Textile CEPOVETT

Cepovett is a French international retail group headquartered in Villefranche-sur-Saône Cedex which trades about 5.500.000 articles of clothing per year. The group works in more than 50 countries all over the world.

Country: France (with locations also in Italy and Spain)

CSR topic: Fair trade

Short description of initiatives: The Group decided to adopt a fair trade policy, in coherence with its philosophy of sustainable development. Due to this reason, the Group proposes a specific type of cotton, defined “fair”. The choice of fair trade reverberates on the entire textile supply – chain; all the suppliers had been made aware of the sustainable development. The Group takes part in several meetings to explain the way to integrate the sustainable development; it also elaborates specific support for the communication on the differences between traditional cotton and that ‘fair’. Finally CEPOVETT has the OEKO Tex Certification and adheres to the Fibre Citoyenne Programme.

The Group gives the opportunity to its supplier to implement sustainable development thanks to the diffusion of a this new type of product. The suppliers are accredited on the basis of their level of conformity to the fair trade trademark.

Grupo CORTEFIEL (Cortefiel, Pedro de Hierro, Springfild, Women’secret)

Grupo Cortefiel is one of the largest fashion retailers in Spain which, through its four brands – Cortefiel, Pedro del Hierro, Springfield and Women´s Secret –is currently present in 48 countries with more than 1400 points of sale across the World. Main locations of CORTEFIEL Group can be found in nine European countries (among which Spain and France), with 970 stores that are directly operated, and in 37 non European countries, where are 345 franchises. Grupo Cortefiel today is a diverse and international group with a vocation to cover customer´s needs through its different brands.

Country: Spain (with locations also in France)

CSR topic: Labor conditions requirements

Short description of initiatives: Grupo Cortefiel does not purchase merchandise or contract any service with manufacturers or suppliers, which do not operate in accordance with specific fixed ethical conditions and working practices.

These principles refer to suppliers, sub-suppliers and sub-contractors, and regard the respect and dignity in treatment of their employees; in particular the requirements focus on:

- prohibition of physical, sexual, psychological or verbal abuse or harassment


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- protection of health, safety and hygiene of workers, in accordance with international conventions

- prohibition in the use of child labor

- respect of compliance with the environmental laws and regulations.

In detail these principles are explained in the External code of conduct; in this code, the principles of corporate conduct are transferred along the supply chain and must be accepted and observed by all the suppliers. The Group gives the opportunity to respect the labor condition, and lays the basis for a close relationship between the Group and their suppliers based on ethical behavior.

Together with the External code of conduct, an Internal Code of Conduct has been signed by the Group Management; it reflects the ethical values, commitments and good practices of the company and it is applicability to all employees.

LVMH Group – Louis Vuitton, Moët, Hennessy

LVMH Group is a world leader in luxury; it possesses a unique portfolio of over 60 prestigious brands in five different sectors among which fashion and leather goods (with such famous brands as Louis Vuitton, Celine, Berruti, Fendi, Kenzo, Emilio Pucci, etc.). The Group employs more than 75.000 persons in the world with more than 1000 stores only in the sector of fashion and leather goods.

Country: France (with locations also in Spain and Italy)

CSR topic: Labor conditions requirements; partnership with suppliers based on ethical and environmental requirements

Short description of initiatives: LVMH promotes responsible partnerships with all suppliers and ensures their effective application by implementation of specific verification. Audits are conducted on suppliers, particularly in countries where sensitivity to the standards defined by the ILO - International Labor Organization is relatively recent. The principal purchasing managers in the Group are undertaken in order to give a more concrete expression to LVMH's commitment to the basic conventions of the ILO. In the field of environmental protection, LVMH has drawn up a global charter that defines environmental protection criteria and goals. As part of LVMH core management organization, an Environmental Affairs Department works to spread the special culture of the environmental impact assessment, coordinates actions and encourages all of subsidiaries to adopt the "best ecological practices" at all levels of production.

By mean of external audits, the LVMH Group stimulates the adoption of good practices by suppliers, rewarding the most virtuous ones.


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Mango MNG holding, S.l.

Mango is a Spanish multinational clothing company based in Barcelona. It designs, manufactures and market garments and accessories for women and men. With almost 6.000 employees, Mango had more than 850 stores in 81 countries located on five continents in 2008. MNG by Mango is one of the most famous brand names.

Country: Spain (with locations also in France and Italy)

CSR topic: Practices of environmental management and control of the supply – chain in respect to environmental requirements

Short description of initiatives: All clothes-manufacture activities are carried out by third parties, not owned by the Mango Holding and located in different countries. The priority in the field of CSR concerns the implementation of environmentally friendly practices in all the areas of their influence. These practices are related to two main kinds of actions involving manufacturers and factories and promoted by the Mango MNG Holding:

• direct check, by external inspections, about the correctness of their production phases and their ways of environmental management (treatment of water used in their processes, textile remainders, wastes, etc.).

• prohibition of dangerous and harmful substances, and control to prevent their use , as specified in their manufacturing instructions (which are drafted in accordance with the applicable international legislation).

The effectiveness of environmental management of manufacturers and factories is considered by Mango MNG Holding an important requirement in its activities. Mango MNG Holding adhered to the UN – Global Compact.

COOP Italia

Coop Italia is the division of Italian Consumers’ Cooperative responsible for purchases, marketing and quality controlling goods with COOP trademark. More than 3000 suppliers (among which enterprises operating in the textile/clothing sector) are monitored in the world and rated on the basis of specific protocols of evaluation

Country: Italy

CSR topic: Labor and environmental conditions; respect of SA8000 requirements; fair trade

Short description of initiatives: Coop Italia represents one of the most important brands in the field of big retail. The brand sells a lot of products (among which textiles) and chooses its suppliers on the basis of the respect of the laws on human rights and environmental safeguard.


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The relationship between the brand and its suppliers is based on opinions and experiences exchange, so to guarantee the respect of COOP values. There is a suppliers control system as defined by the SA8000 standard. For each periodical audit, if a no-conformity is found, the auditor requires improvements activities; if these activities are not implemented, the supplier will be cut off COOP suppliers list.

COOP stimulates the implementation of CSR - related tools in the field of human rights among SMEs: these SMEs cannot afford to ignore this pressure in order to be able to continue to supply the COOP brand.

COIN Group

Coin Group is leader in Italian apparel retail with a 4.51% market share. Coin Group operates under two distinct brands, OVS industry and Coin. The Group is both distributor of luxury brands and manufacturer of its own collections. As well as apparel, Coin Group also stocks accessories, health & beauty products, and home decoration items. The Group is consolidating an expansion plan abroad with the opening of new stores, in Eastern Europe and the Middle East and, recently, in India.

Country: Italy

CSR topic: Code of conduct; definition of social and environmental requirements for suppliers

Short description of initiatives: Coin Group asks for the suppliers the adhesion to its social code of conduct. Such in a way, Coin encourages the suppliers to comply their policies and behave to established principles such as respecting human rights, employment law and environmental protection; the suppliers have to guarantee the respect of these rules also by their sub-suppliers. Coin Group, periodically, verifies the compliance of these requirements by committing audits to an international certification organization . On the basis of the results of these audits, the suppliers can continue to be accredited or not. These audits concern quality requirements and social and environmental ones.

COIN Group creates a stimulus in adopting socially responsible behavior by suppliers: these SMEs are constrained pay attention to these themes in order to be able to continue to produce to COIN or OVS brands.


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3. CREDIT AND INSURANCE SYSTEM ANALYSIS

The third section of this report relates to the role of credit and insurance systems in stimulating and awarding enterprises (and in particular SMEs) adopting CSR – related tools. Differently from the previous sub-sections of this document, this part lacks of the literature review and is composed only by an analysis of the main evidences in three countries and the description of an experience of excellence in the field of insurance systems. In our research perspective, in fact, this theme has not been yet studied in depth; the available papers in this field concern the analysis of the link existing between CSR and financial performance (i.e.: Ziegler et al., 2007, Orlitzky et al. 2003), or studies about the linkages between financial development and sustainable development (i.e. Scholtens, 2006), or, finally, surveys about the behaviors of investors in respect to social and environmental performances of enterprises (i.e. Horton, Kember 2008). These examples, what’s more, never take in consideration neither SMEs nor enterprises from the textile/clothing sector. In respect to the collected evidences, these are many and concerning the three European countries (in particular 11 experiences from Italy, 2 from France and 4 from Spain). The collected best practices regard promotions and initiatives carried out by banks and credit institutes in favor of SMEs, but they’re not exclusive of SMEs of the textile/clothing and leather sector. These initiatives aim at supporting enterprises oriented to integrate social and environmental concerns into their decisional processes and programmes of investment. This section of evidences is followed by the description of one specific experience concerning the agreement signed in 2004 between an Italian consortium (the Pollution Pool) and the biggest Italian Trade Association (Confindustria) aiming at awarding (with a discount on policies for environmental risks) the enterprises that implement and certify their Environmental Management Systems. The economic advantage is evaluated in about – 20% of the assurance premium for ISO14001 and EMAS certified enterprises. A specific focus on the textile/clothing and leather sector is detailed.

3.a Evidences

The best experiences carried out in the three countries (Italy, Spain and France) and concerning the textile/clothing and leather sector have been selected in the following table; they mainly refer to initiatives promoted by French, Spanish and Italian bank groups aiming at awarding green and social initiatives by SMEs (included those operating in the clothing/textile and leather sector). These initiatives refer above all to investments in technical solutions for energy saving and renewable energies; there are then some banks financing only specific ethical operations, and then

there are (even if rarely) experiences of easy-terms loans for enterprises with excellent ethical and environmental performances, demonstrated by the implementation of formalized CSR – related tools.

NAME OF THE INSTITUTE

COUNTRY and CSR TOPICS

DESCRIPTION OF INITIATIVES

Banca Etica

ITALY

Social and environmental management

Banca Etica is a financial institution that operates based on the idea of financial ethics which means operating with transparency, providing access to credit, efficiency and social and financial duty. Recently the Bank started to finance projects oriented to promote biologic agriculture, renewable energies, energy saving and energy efficiency. They also have a credit line for small business (professionals, individual entrepreneurs, and small companies) with relevant activities in social and environmental fields. The Bank created a forum for SMEs to give them the opportunity to deepen the benefits and critical aspects starting from CSR pattern.

This initiative gives the possibility to SMEs to finance projects that promote initiatives in environmental protection and those with a social as well as economic scope. Opportunity to deepen the CSR awareness.

Monte dei Paschi di Siena MPS Group

ITALY

Environmental management Promotion of technological innovation in the field of

renewable energies

The Group has a lot of initiatives and funding to promote CSR among SMEs. The most important are the following ones: “FOCUS AMBIENTE”: it is an opening medium term financial package oriented to promote the environmental certification costs for the adhesion to EMAS and ISO 14001. “WELCOME ENERGY”: funding for companies that want to install photovoltaic plants, combined with an insurance for material damage eventually produced during installation. “FINANZA VERDE”: since 2009 the Group implements an energy policy that consists on: investment for renewable energy and promotion of facilities to produce electric energy from renewable sources, especially for the wind power sector. “BANCA VERDE”: it gives some long term funding for investment to produce electric energy from renewable sources or for electric energy with a low environmental impact. It also provides credit for environmental management systems certification on EMAS and ISO 14001.

With these initiatives companies can finance implementation costs of Environmental Management Systems and their certification. SMEs, could be stimulated to invest in green technologies and renewable energies.


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INTESA – San Paolo

ITALY

Technological innovation in the environmental and

energetic fields

The bank offers ethical investment services, with several investments in funds characterized by an high social and environmental profile. To do that, the bank establishes an agreement with associations of category to promote the access to credit for SMEs by trust. The bank provides technical and institutional advice to support firms in gaining access to grants distributed by European Union, in favour of research and technological development (for example renewable energy). The bank finances processes of clean energy rationalisation, it promotes the responsible use of environmental resources, and it encourages the expansion of environmental management systems (in accordance with ISO 14001/EMAS standards) among SMEs. The bank also offers: “INTESANOVA ENERGIA”, provides finance of up to 100% of investment costs in the field of renewable energies, with up to 10 years repayment option. “ENERGIA BUSINESS”: it is a medium – long term financing plan to facilitate the acquisition and installation of small and medium photovoltaic plants; it can also be used for investment in research and development and in solar energy. It gives the opportunity to deal with the initial costs of the installation.

With these initiatives the bank gives the possibility of medium and long term financing for projects of energy efficiency. The group operates with local actors to offer products and services to support innovation, firms’ internationalisation and competitiveness

Unicredit Bank

ITALY


energetic fields and support to the implementation of

Environmental Management Systems

The bank created afunding to install photovoltaic systems in SMEs. It could be with or without real guarantees and it covers up to 300.000 €, with a fixed or variable rate. It repayments plans are between 2 and 15 years. The Unicredit Group has EMAS registration and promotes five years easy-terms loans for enterprises having the same environmental certification. In general the initiatives proposed by Unicredit give possibility to SMEs to innovate their energetic source of supply, adopting renewable ones. The easy – terms loans are, moreover, another opportunity for EMAS small businesses in implementing improvement plans

Gruppo Credito Cooperativo ITALY The bank stipulated a convention with Legambiente to promote the use of Renewable Energies through funding with facilitated conditions. The topics that can be funded are:


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energetic fields

- adoption of solar and photovoltaic systems - adoption of wind systems - adoption of biomass systems - substitution of actual boilers with ones with higher energetic efficiency - feasibility of studies to reach high efficiency on waste energy

These initiatives give the possibility to realize efficient plans to produce energy, differentiate energy sources and rationalize the consumptions.

Credito Cooperativo del Friuli

ITALY

Technological green innovation and green

procurement

This bank promotes two main initiatives in this field: “Energie Rinnovabili”: this is a funding package (characterized by prime rates) reserved to companies aiming at adopting measures for the energy savings. The funding concerns the purchase of photovoltaic and biomass systems, the replacement of fixtures, the reduction of thermal dispersions, the installation of solar panels and the restructuring with certified EMAS material. “Prestito Energia Pulita”: the bank has developed a special financial formula, which allows the SMEs covering the installation costs of photovoltaic systems with contributions from a specific Energy Account.

These initiatives make possibility to realize efficient energy plans and cover high costs of installation of systems of renewable energy.

EmilBanca

ITALY

Innovation in the field of renewable energies

EmilBanca’s main initiatives are the following ones: “Ecofinanziamento”: it is a financial package for investments in production of renewable energy. “Assurance of photovoltaic system”: it is an insurance for material and direct damages to the photovoltaic plants (structures assembly, cabinets, stands, brackets, control and detection), caused by any events. The annual premium is based on kWp comparable to the market value.

It provides several opportunities to SMEs interested in investing in the field of renewable energy.


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Banco Popolare Group

ITALY

Stakeholder engagement initiatives

“Enterprises workshops”; the group organizes initiatives with actors from different sectors with the aim of sharing experiences, ideas, best practice and forecasting trends and future needs of the market references; on the basis of emerged scenarios, projects and solutions are outlined to promote the competitiveness of enterprises. The initiatives depend from the received proposals in the workshops. In the last years, the Banks of the Group provided medium or long-term credits to the SMEs, evaluating also their ethical and environmental performances

UBI Banca

ITALY

Technological green innovation and green

procurement

Package “Nuova Energia”: it is an initiative dedicated to entrepreneurs who invest in the environmental sustainability of their businesses. In particular it is specialized in two lines: - photovoltaic: the fund covers investments for construction and expansion of facilities for the production of electricity from solar energy; - renewable and energy saving: this line finances investments for the production of energy from different renewable sources or initiatives of energy saving and improvement of energy efficiency.

It offers loans or mortgages, with fixed or variable rates, covering up to 100% of the investment, and it offers the opportunity to sign a bill that provides broad coverage against direct and indirect risks.

Etica SGR ITALY

Ethic investment

The bank builds and promotes mutual funds and other financial products that respect the environment and human rights. It aims at promoting Responsible Finance. It promotes investments only into socially responsible companies and countries, chosen in accordance with social and environmental criteria; it gives advices for Socially Responsible Investments.

It gives the opportunity of an ethic fund to invest with a professional consultancy.

Confidi Roma Gafiart

ITALY

Gender equal opportunities and development of micro –

entrepreneurship.

The initiatives carried out in Lazio Region by Confidi aims at guaranteeing the access to credit to specific categories of entrepreneurs (women and micro enterprises) to carry out activities in the field of environmental protection and business ethics. An example of these initiatives is the agreement signed by Chamber of Commerce of Rome for which enterprises with a majority participation of women can get funding for projects in energy saving and workers’ safety.

These initiatives can promote women’s entrepreneurship and promote ethical finance for the


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development of local micro enterprises.

BNP Paribas - BNL

FRANCE/ITALY

Environmental innovation in the field of renewable

energies

Package “Energy Business”: it is a project designed to support enterprises in the acquisition and installation of photovoltaic plants. The enterprise can install a photovoltaic system to reduce energy consumption and to electricity generation, with a subsided credit for the investment.

This initiative gives the possibility to install efficient plants to produce energy with a lower cost of investment.

Banque Popolaire

FRANCE

Technological green innovation

This bank promotes two main initiatives in this field: “ProvAir”: the Bank created financing for the energy saving, such as: wood boiler, solar thermal or photovoltaic plants, replacing an oil boiler with a heat pump thermal control, etc. “Financer l’Eco - innovation”: it includes various credit options, especially for renewable energy and for the environmental protection. It creates a guarantee fund for those operating in the environmental sector; it also develops several funds to finance specific projects oriented to the promotion of the sustainable development.

It promotes the sustainable development allowing the SMEs to invest in environmental innovative projects.

Bancaja SPAIN

Environmental management

Bancaja offers to its business customers financial environmental management services, placing at their disposal environmental consultants. The services are free of charge or at preferential rates.

It gives the opportunity to SMEs to have a specialist environmental consultancy in respect to environmental investments

BBVA

SPAIN

Energy and environmental management and innovation

“Plan Remedia”: this project offers opportunities for energy savings and the efficient management of resources within four areas of activity: energy efficiency and investment in renewable energies, environmental management, accessibility fitting and corporate responsibility.It gives the opportunity to use incentives implementing environmental and social


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plans of improvement

CAJA Navarra

SPAIN

Social management and reporting

The Spanish bank offers the chance to business customers to have their own social responsibility reports. This is a pioneering initiative (at second year of implementation) which allows customers to publish and communicate their efforts, progresses and improvements in environmental, social and economic matters.

This initiative gives the possibility also for SMEs to draft social reports describing their CSR initiatives, making their social and environmental performances a variable of competitive diversification

Previsora General

SPAIN

Health and safety management

Previsora General implemented three different typologies of insurances: “Seguro de convenio colectivo”: it is an unique online service for companies related to legal requirements for the protection of personal risks for their workers. The insurance coverage is usually for industrial accident and permanent disability. “Seguro de accidentes colectivo”: it includes the payment of collateral damages in case of an accident, with the payment of compensation in case of incapacity (temporary or permanent) or death. “Seguro de vita colectivo”: the life insurance is designed for the employers. In case of death, the insurance will pay to the beneficiary or beneficiaries designated a guaranteed capital. In defining the insurance premiums, Previsoria General treats with respect the ethical performances of enterprises, in particular in the field of health and safety of workers.

This insurance group gives lots of opportunity to SMEs, above all to assure workers from industrial accidents. SMEs oriented to CSR are preferred and their premiums are lower.


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3.b Experiences: THE ITALIAN POLLUTION POOL

INTRODUCTION

This section deals with an Italian important experience, in the insurance sector: the agreement signed in 2004 between an Italian consortium (the Pollution Pool www.poolinquinamento.it) and the biggest Italian Trade Association (Confindustria) aiming at awarding (with a discount on policies for environmental risks) the enterprises that implemented and certified their Environmental Management Systems. This report represents the synthesis of meetings organized with the functional foremen of the Pool (Dr. Giovanni Faglia and Dr. Lisa Casali) and what emerged by the analysis of the documents furnished by them. We would like to acknowledge the participation, support and willingness of Italian Pollution Pool.

THE ROLE OF ITALIAN POLLUTION POOL AND THE PROCEDURE OF RISK ASSESSMENT

The Italian Pollution Pool is a co-reinsurance consortium, active since 1979; it consists of 38 insurance companies and 4 professional reinsurers. The main players in the environmental insurance market with a specific policy wording are Pool Inquinamento, Chartis, XL Insurance, ACE, Chubb and Zurich Group. The Pollution Pool deals with the technical assessment of the risks, technical visits, management of claims and the study of environmental issues and their insurance. Before the birth of the consortium the risk of pollution in Italy was secured only with the extension on General Civil Liability Insurance (Responsabilità civile generale, RCG, in Italian), and only for the accidental pollution. The obligations for a company in case of pollution incidents are:

1. recovery of protected species and habitats; 2. compensation for damage to property, people and interruption of activities; 3. emergency measures and clean up of soil, subsoil and water.

The problem of improper environmental insurance coverage is that when the risk is underestimated, the level of coverage is not sufficient. The limited spread of specific policies for the pollution risks is motivated by several reasons:

• environmental issues are generally very technical and not of immediate and easy understanding; • risk of incorrect assessments of potential pollution damage resulting from a specific productive

process; • limited knowledge of legal requirements; • underestimating of the costs for an environment reclamation; • missing analysis of the damage that can be eventually caused to third parties; • the difficulties in estimation of the efficiency of firm' prevention/protection measures; • limited structures of Risk Management in a large number of enterprises; • the inadequate knowledge of the insurance product and its costs; • the lack of knowledge both of the risk and insurance products by brokers; • the continuous use of the extension clause on accidental insurance policies RCG and limited

knowledge of its real coverage. These issues are deeper if we consider SMEs, because of their lack of human resources and technical competences and their difficulty in perceiving their real impact on environment.


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How do the policies work for the firms-customer? The firms contact the insurance agents, and consequently they fill out a very specific questionnaire on pollution data that they produce. The agents transmit the request to the insurance company (part of the consortium), which turns the request to the Pool. The Pool make a first evaluation of the firm based on the completed questionnaire, thus it emits an assessment. The limits of indemnity issued could reach a maximum of 40 million of euro. The Pool communicates to the company the pure premium (the minimum) that is equal for all companies. The various companies can make loads on premium and this fall in the remuneration for brokers, agents and companies themselves. The taxable Premium has a 22.5% of tax (that is a very high percentage). For the technical assessments the Pool uses a network of experts (environmental consultants, insurance adjusters) across Italy; after the issue of the policy, they can audit directly the firms: this happens if:

1) the applying enterprise operates in a risky productive sector (examples are: chemical, petrochemical, tanneries),

2) doubts arise from the questionnaire filled out by the firm. About 230 inspections are made on average per year, on 3.000 total settlements. The firm, after the first inspection, shall be reviewed every 2 / 3 years. The Pool may revise policies on the base of the inspections. There are 4 policies wording offered by the Pool:

1. Environmental liability - settlements. This policy covers the 80% of the portfolio of the Pool and it is composed of a basic warranty plus optional. The basic warranty is divided into two sections: civil liability and clean up. The optional guarantees are: damage to protected species and natural habitats, the decontamination of property and equipment, loading and unloading operations to third parties.

2. Environmental Liability – Contractors (Civil Liability and Clean Up). 3. Environmental Liability – Loading and unloading operations to third parties (mechanically) 4. Dangerous goods in transit by third party policy

Finally it’s important to notice that a similar experience of Pool Inquinamento exists in other European Countries:

• in Spain, the Pool Espanol the Riesgos Medioambientales • in France, the Assurpol

The main purpose of these entities is making the enviromental risk and liability a new focus for European firms, also for the preservation of the long-term competitiveness in global market.

TERRITORIAL AND SECTORIAL PROFILE

In Italy the requests for pollution insurances come for a 75% from Northern Italy, 20% Centre Italy and 5% in the South. It’s to be considered that 50% are from the Veneto Region because there is a regulatory requirement to have a policy for waste treatment. The main represented sectors are those liable to the IPPC – Integrated Pollution Prevention and Control Directive and Seveso regulation, with the most of enterprises operating in the following sectors: waste and water treatment, chemical, petrochemical and engineering. Frequently they are big enterprises, having economic resources to face the additional costs of insurance premiums. The SMEs, because of their lack of human and economical resources and of technical competences, decide to renounce to these insurance packages, often without perceiving their usefulness. In the fashion sector, moreover, the enterprises are not always aware of their environmental impacts and of the level of risks associated to their productive process (in particular for some productive phases of textile and leather sectors). Because of this, SMEs of textile/clothing/leather sector with a policy are not a lot (about 2% of total number of issued policies).


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Sectorial distribution (%) of RC pollution policies in Italy (source: POOL RC Inquinamento, 2008)

In general, the textile/leather sector is under covered with respect to the environmental risk; as known, some phases of the productive processes of the textile and leather sectors are characterized by a high risk of environmental impact, for which the signature of a policy could be reasonably useful (also in respect to the new environmental legislation, with the acknowledgement into the Italian legal system of the EU Directive 2004/35 on Environmental liability with regard to the prevention and remedying of environmental damage). Unfortunately, as already outlined, the lack of human, economic and technical resources characterizing SMEs (and textile/leather ones) represents a restraint to the adoption of this kind of solutions.

THE AGREEMENT “POOL – CONFINDUSTRIA”: AN AWARD TO CSR – RELATED TOOLS ADOPTION

Environmental protection is a factor of competitiveness and sustainable development is a goal shared by the major industrialized countries. For this reason, in 2004 the Pool has signed a Memorandum of Understanding with Confindustria (the biggest Italian manufacturing and services companies federation) with commitments to:

• deepen together the main issues of concern relating to the prevention of environmental pollution • verify the possibility to develop legislative and operational proposals, able to facilitate the perception

of environmental prevention as a factor of competitiveness' business • provide that these proposals can be brought to the attention of the institutions (European Union,

Government and Parliament) and the general public as well as in the associative system of Confindustria and insurance business

• define common actions for stimulating companies in adopting certified environmental management systems.

For the immediate future: • the Pool is committed to grant a reduction in the cost of pollution insurance for companies certified

with ISO 14001 and EMAS; the discount amounts about to 20% of the pure premium; it’s important


77

to notice that the gross amount of the policy (without discount) has to be explicated in the estimate, and the amount of certification discount has to be completely highlighted.

• Confindustria is committed to promote an educational and information activity with affiliates firms about the agreement concluded with the pool.

In the first years of the Memorandum the policies drawing up have been very high; now their increase can be considered constant. From the monitoring of certified companies, it was noted that the loss ratio is less than those with no certification. Anyway, the 20% of the discount for the policy, in the Pool opinion, does still not correspondent to a -20% of decrease of environmental risk (giving a net competitive advantage to enterprises).

CONCLUSION

The agreement between Pool and Confindustria represents a very relevant experience; as from the initiative of two market institutional actors (the biggest representative association of entrepreneurs and a big consortium of insurances), this agreement allowed to define a specific monetary award for enterprises adopting specific CSR – related tools (implementation of Environmental Management Systems), aiming at preventing environmental damages and giving them a quantifiable economic competitive advantage. This experience could represent a model for other future agreements between institutional, private and public actors, with the same aim.


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4. PUBLIC POLICIES ANALYSIS

This last section aims at surveying the role of policymakers in stimulating and supporting SMEs (in particular those operating in the textile/clothing and leather sectors) to adopt responsible initiatives and CSR – related tools (by means of incentives, fiscal discounts, administrative simplifications, etc.)

The first step relates to the collection and analysis of main academic studies and research concerning the relationship between public policies and CSR. The systematic literature review method has been, also in this case, adopted; all main thematic areas of research have been mapped and main academic search engines used. Main adopted keywords were: “public policies”, “CSR”, “SMEs”, “textile”, “leather”, “fashion”, “apparel”, while the search engines used were Ebsco, Host e Jstor. The result has been a 20 papers collections, of which nine have been selected and inserted in the following table.

The papers below provide an overview about public policies and their ability to stimulate the implementation of CSR related tools by sectorial SMEs. Some papers deal with tools and indicators adopted by public authorities, and the advantages deriving from it; others give a review of main policies implemented by national European authorities in the different countries promoting CSR in a competitive perspective. The second step analyzes Evidences carried out; a selection of initiatives, promoted by political institutions in the three Countries which supported or provided incentives for the adoption of CSR related tools and practices by SMEs of the three mentioned sectors, has been proposed. Sources of information where : websites, official documents published by public authorities and direct interviews. In this section, the information described onto the spreadsheet are the following:

- Public Authority: reference to the Public Authority that promoted the initiative;

- Country: reference to the specific Country (Italy, France or Spain);

- CSR topics: detailing the CSR - related tool(s);

- Policy instruments: detailing the policy reference (national law, regional law, ministerial regulation, etc.);

- Main contents: short description of the initiative;

- Tools: detailing the instrument adopted by the Local Authority to support or reward the adoption of CSR practices by SMEs. The following categories have been selected (again in accordance with European Commission 2008): rewards, grants, fiscal incentives, economic incentives, information instrument, mandating instrument;

- Competitive benefit: taking into consideration the benefits connected with the adoption of the CSR-related tool promoted by the Public Authority for SMEs of the textile/clothing and leather sector;

In total 37 public policies have been analyzed, most of which Italian (87%); Spanish 8% and French 5% initiatives represent only a small share. The following chart details interest areas of promoted policies; 42% of the selected policies concerned the Workplace CSR (safety of workers, initiatives anti – discrimination, etc.).


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9%

42%

2%

33%

7%

7%

Environmental related

CSR

Workplace CSR


Management system

Market CSR

Accountability

In respect to incentives system, public authorities have a relevant role in the set up of CSR practices implementation; nevertheless, this practice cannot sustain the continuous maintenance of their adoption. On the other hand, systems of fiscal incentives to the adoption of CSR related tools (above all the formalized ones) proved to be more effective.

15%

38%

5%

17%

15%

10%

Informational instrument

Grants

Reward

Fiscal incentives

Economic incentive

Mandating instrument


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References Description of contents CSR tools mentioned Conclusions

M. de la Cuesta Gonzales, C. Valor

Martinez (2004)

“Fostering Corporate Social Responsibility

through public initiative: from the UE to the Spanish Case”.

Journal of Business Ethics 55: 275-293

This paper, makes a critical analysis of current international, European and national initiatives to foster CSR among companies, such as standards issued by UN, ILO and OECD or initiatives directly promoted and implemented by governments.

Accountability and Management

systems

Market place CSR

The paper focuses on the Spanish case, as an example of the failure of an exclusively voluntary approach, because most actions have been carried out by companies with no common guidelines, governmental support, or independent verification. The authors say that Spanish national and regional governments, should give priority to some policies such as: make the public sector accountable for its economic, social and environmental performance and consult stakeholders before making decisions which can affect them; try to integrate issues of corporate accountability with issues of good governance; use ethical and social criteria in government purchases; give local authorities tools for promoting local CSR among SME.

A. Tencati, F.Perrini, S.Pogutz (2004)

“New tools to foster corporate socially

responsible behaviour”.

, Journal of Business Ethics 53: 173-190

The authors show the main results of a research project developed by Bocconi University, called CSR-SC, in order to promote the proactive social role of Italian enterprises, with an attention on SMEs’ involvement. The research shows some indicators that can be used to check and demonstrate organizational performance. Such indicator can be qualitative, quantitative (physical and technical) or economic-monetary. The CSR-SC standard organizes the indicators according to a three-level frame work: Categories, Aspects, Indicators. The indicators are for example: Composition of employees, Shareholder remuneration, Market development etc.

Accountability and Management

systems

Workplace and Marketplace CSR

The authors identify the possible advantages, for companies, deriving from participation in the CSR-SC project; these enterprises increased: - corporate trust and reputation, improving the relationships with different stakeholders; - better market position in relation to the increased demand for ethical products (goods and services); - easier access of companies to the financial markets and especially to ethical, environment and sustainability oriented funds operating in accordance with Socially Responsible Investing (SRI) principles; - possible fiscal, economic and administrative incentives, given by the Governments in order to reward socially responsible companies.


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ENSR

“European SMEs and social and

environmental responsibility”.

2002, Observatory of European SMEs, N°4

The article shows some different national policies to support European SMEs implementing CSR. In particular, examples from France, Spain and Italy are underlined.

Workplace CSR


The French public sector provides several fiscal incentives to support the enterprises’ donations on non-profit organisations. It, also, identifies a number of specific measures to facilitate the insertion of people with special difficulties, such as long-term unemployed, disabled, young unemployed. In Italy the main public policy to support CSR activities among SMEs is given by fiscal exemptions to sponsorship/patronage activities. In Spain, some fiscal benefits are provided for those enterprises that take part in social activities through foundations.

Perrini F. (2007)

“Encouraging CSR in Italy: the enabling role

of government in mandating, motivating,

and supporting responsible business

practices”

Working Paper N°35.

This paper explores the most relevant Italian CSR initiatives. It analyzes the government policies that promote the analysis, verification and validation of CSR practices such as regional laws, national and regional initiatives.

Workplace CSR

Environment related CSR

Several CSR initiatives have been promoted in response to the rising level of public attention to environmental protection, safety, and respect for workers’ rights and human rights in general

AA.VV. (2008)

“Politiche di CSR promosse dalle

istituzioni e dalle associazioni

imprenditoriali in Italia, lavoro e qualità della

vita”.

This research monitors the initiatives carried out by public institutions and by Trade Union to promote and to spread the adoption of CSR - related tools and initiatives by Italian companies. The research examines the intensity and the quality of public institution engagement regarding their commitment to the CSR themes. The intensity is measured by the number of initiatives and laws; instead, the quality is measured by the

Workplace CSR

The authors show the main results coming out from the research about: equal opportunities, work life balance, work inclusion disabled people, support to female entrepreneurship, certification on work quality and safety. The survey allows to understand how the public institutions and the trade union interventions promote the CSR between Italian companies. The main limit emerging from the study is that only in few cases, the initiatives to promote CSR are based on the attempt to converge the efforts of the actors


82

Osservatorio Operandi

nature of initiatives carried out by public institutions. The monitoring is focused on the promotion of CSR experiences regarding the workers.

having differences rules and competences (institution, trade unions, enterprises, etc..)

R. Steurer, S. Margula, G. Berger (2008)

“Public policies on CSR in EU member states:

overview of government initiatives and selected cases on awareness raising for

CSR, sustainable public procurement and

socially responsible investment”.

ESDN Quarterly

Reports, June

This report examines public policies on CSR. It describes the policy instruments that governments adopt to support CSR initiatives amongst SMEs. It distinguishes between Fostering philanthropy and charity and Fostering Socially Responsible Investment and instruments such as soft legal, financial or economic ones.


Management

systems

Market place CSR

Policy makers can choose from a broad spectrum of CSR policy instruments (from informational to legal instruments). Raising the CSR awareness is an important political task, and it should be promoted by a mix of instruments. The success factors are various, and the most prominent are the following two: - CSR initiatives should focus on the specific needs of companies of different sizes from different sectors - new platforms or centres for CSR should cooperate closely with existing institutions and structures (such as Chambers of Commerce or regional trade unions).

L. Alberada, J.M. Lozano, A. Tencati, A.

Midttun, F. Perrini (2008)

“The changing role of

governments in corporate social

responsibility: drivers and responses”

Business Ethics: a

This paper focuses on the analysis of the new strategies adopted by governments in order to promote and encourage businesses to adopt CSR values and strategies. The research compares CSR initiatives and public policies in three European countries: Italy, Norway and the United Kingdom, and focuses on governmental drivers and responses.


In this report, the vision and the strategy of governments in promoting CSR are analyzed, taking into account the new relationships that governments are establishing with the various social agents, such as businesses and social organizations. There is a general consensus among all actors, governments, businesses and NGOs in terms of CSR policies concerning the necessity of new partnership strategies and a multistakeholder approaches. In order to achieve such results, governments will have to analyze the different perceptions and expectations of the different agents. Moreover, the government’s role entails much more than promoting and encouraging. It means working as a


83

European review Volume 17 Number 4 .

mediator between businesses and NGOs.

AA.VV. (2007)

“The CSR Navigator: Public policies in

Africa, the Americas, Asia and Europe”

GTZ,

The Deutsche Gesellschaft für Technische Zusammenarbeit (GTZ) and the Bertelsmann Stiftung had jointly explored how governments can contribute to shape a fair and balanced process of globalization by working together with private actors and civil society. Incorporating CSR into national policies can be seen as a first important step towards this new, shared governance approach.


Market place CSR

The research has developed CSR public policy profiles for each of the 13 analyzed countries (including France). These profiles are the basis of the CSR Navigator, a tool designed to map CSR public policy instruments and to choose measures appropriate to a country’s particular situation.

Berger, R. Steurer, A. Konrad, A. Martinuzzi

(2007)

“Raising awareness for CSR in EU member states: overview of

governments initiatives and selected cases”.

Final report to the EU High-level group on

CSR, May

This report shows government initiatives at the national level aiming at raising CSR awareness in EU Member States. These initiatives were analysed by using a three-step policy study format: 1. systematic review of the Compendium on national public policies on CSR in the EU and literature. A telephone survey among public administrators from Member States regarding CSR awareness raising. 2. selection and analysis of three interesting good practice cases from different Member States 3. summary of results of the survey and the case studies, with a special focus on success factors and challenges of different CSR policies and policy instruments.


Market place CSR

Governments addressing CSR topics use the following instruments:

- informational or endorsing instruments (campaigns, guidelines, trainings),

- partnership instruments (networks, partnerships, dialogues),

- financial or economic instruments (economic incentives, subsidies, grants),

- mandating instruments (regulations, laws, and decrees).

4.b Evidences

Public Authority Country CSR topic Policy instruments Main contents Tools Competitive benefit

Sardegna Region Italy Environmental related CSR

Environmental Energy Plan 2006

The Region carried out programs to stimulate the use, among SMEs, of solar energy through thermal and photovoltaic technologies. The Regional Government is also involved in programmes aiming at the development of other alternative energy sources, such as hydrogen.


Use of renewable sources

Resource efficiency

Tuscany Region Italy Environmental related CSR

Regional Law n. 39 /2005 "Disposizioni

in materia di energia”

The Region promotes investments in technologies for energy saving and renewable energies deployment,. The Region also stimulates initiatives providing funds, grants and subsidising interest. It promotes the assistance of the SMEs in accordance with European act for environmental protection’s rescue. The act stimulates industrial research and the competitive development of renewable sources.

Grants

Economic incentives

Use of renewable sources

Resource efficiency

Cortes Generales Government

Spain Workplace

CSR The Organic Act

3/2007

It includes a package of measures to ensure equal opportunities between genders in the public and private sectors. The law outlines the principle of equality and the exclusion of all kinds of discrimination. In this way the application of equality in the political, legal and living conditions is assured .


Improvement of labour conditions (and of their

productivity)

Increase of human capital

Ministère de l’ecologie, del’energie, du

developpment durable et de l’amènagement

du territoire

France Environmental related CSR

“Les prix enterprises et environment”.

It is a prize for enterprises implementing best practices for environmental protection, for sustainable development and tested ways of reducing impacts of products’ life cycle.

Reward Corporate reputation

Ministerio de trabajo e immigracion –

direccion general de la economia social del

Spain Community related CSR

“Law 49/2002”.

Companies receive tax credits for donations made to charities, social institutions or programs benefiting the local community. Credits can be of up to 35% of the amount of

Fiscal incentives

Corporate reputation

Cost efficiency


85

trabajo autonomo y de la responsabilidad

social de las empresas.

the donation or up to a maximum of 10% of basis assessment for program realization. Tax deductibility can span for up to 10 years.

Government Italy

Workplace CSR

Management

system

“Legislative decree 38/2000”.

The decree aims at improving labour conditions. It disciplines interventions to improve labour safety. It refers to programs and projects for health and safety at work, such as renewal of machineries and systems, workplace renovation, implementation of management systems. This type of interventions can be financed by the government.

Grant

Improvement of labour conditions


INAIL (National Institution

for the assurance against industrial

accident)

Italy Workplace

CSR

Ministry decree the 12th December 2000: “Nuove

tariffe dei premi per l’assicurazione

contro gli infortuni sul lavoro e le

malattie professionali delle gestioni: industria,

artigianato, terziario, altre

attività e relative modalità di

applicazione“

INAIL provides 10% discount on insurance premium to enterprises. Interested enterprises (if small or medium) must be operating for at least for 2 years and must comply with health and safety regulation. INAIL asks improvements and interventions to be indicated. The law require companies to implement a safety and health management system

Economic incentive


Cost efficiency

Ministero del lavoro e della previdenza

sociale Italy

Workplace CSR

“Fondo interprofessionale per la formazione

continua”.

The Institute disposes financial resources from the “National plan on safety training ”. The beneficiaries are workers which are inclined to improve their labour condition.

Grant



Government Italy Workplace

CSR Law 53 March the

8th 2000. The law promotes a work-life balance initiative. Workers are stimulated to manage

Grant Improvement of labour

conditions


86

their workload allowing enough time for their work as well as for their private life commitments (such as family needs).


Emilia Romagna Region

Italy

Workplace CSR


Regional Law 17 August the 1st 2005

(referred to National Law

598/94).

It promotes enhancement of the labour, health and safety conditions. It encourages investment for innovation technology, environmental protection, organizational and commercial innovation and, labour safety.

Economic incentive


Promotion of innovation

Cost efficiency

Tuscany Region Italy

Workplace CSR

Marketplace

CSR

Management system

Regional Law 17 of May the 8th 2006.

Aimed at the management of CSR development based on equal opportunities and equal rights, no discrimination, people valorisation and territorial cohesion. It support initiatives to promote CSR such as training activities. The Region provides information, communication and promotion initiatives that guarantee the diffusion of those initiatives among organizations and citizens. The law describes benefits for SMEs aiming at implementing certifiable management systems.

Information instrument

Economic incentive


Cost efficiency

Tuscany Region Italy

Workplace CSR


Management

system

Piano di sviluppo economico

regionale 2007 – 2013.

The plan envisages operational tools for the promotion of CSR through direct support to certified enterprises. It grants a reduction of 0,50% on IRAP (regional tax on productive activities) rate for SMEs with SA8000 and EMAS certifications, and 0,35% for enterprises with ISO14001. SMEs participating on this initiative can apply for further incentives.

Fiscal incentive



Cost efficiency

Campania Region Italy

Marketplace CSR


Regional decree 02/2008.

It provides grants for the implementation of management systems in accordance with ISO 14001, EMAS, Ecolabel regulation, SA8000 and ISO 9001. The Region provides up to 20% of

Fiscal incentive

Grant




87

Management

system

implementation costs. Cost efficiency

Piemonte Region Italy Workplace

CSR Regional Law

34/04

It gives fiscal incentives (tax breaks) for the implementation of tools and instruments to improve safety of workers. The interventions can be technological, infrastructural and managerial ones.

Fiscal incentive


Piemonte Region Italy

Management system and

accountability


Documento Unico di programmazione

(DOCUP) 2000-2006.

It offer special consultancy services for environmental management certification and for Social Balance certification. The Region finance up to 75% of the certification consultancy costs.

Grant Corporate reputation

Cost efficiency

Umbria Region Italy

Workplace CSR


Regional Decree 598/94

It provides grants for the acquisition of assets which sustain projects and investments in innovation technology and safety. The Region covers up to 70% of the costs related to the implementation of safety management systems or consultancy for improvements in the fields of environmental protection and safety

Grant


Cost efficiency

Valle d’Aosta Region Italy Management

system Regional decree

28/2004

The Region offer environmental, quality, safety and CSR management systems support. It covers up to 15% of the costs of development of management systems.

Grant



Veneto Region Italy Management

system Regional decree

01/2008

It grants a Regional contribution to firms which obtain ethics and social certifications. The Region covers up to 100% of certification costs.

Grant



Lazio Region Italy Workplace

CSR

Regional Law 16 September the 18th

2007

It describes CSR as a tool to improve labour quality. It defines the requirements to gain access to funding for projects related to work life balance.

Economic incentive



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Marche Region Italy Management

system

Regional Law 228 February the 16th

2005.

The Region gives to SMEs incentives for the implementation of eco-management and Social Responsibility System. The Region manages a database of socially responsible SMEs.

Grant

Reward



Calabria Region Italy Workplace

CSR

Piano regionale per lo sviluppo e il lavoro 2008.

It grants financial resources to cover up to 90% of implementation costs of corporate and inter-corporate projects concerning work-life balance. SMEs’ workers have many opportunities, such as: crèche for their children, disability benefits, opportunity to use remote working solutions.

Grant



Autonomous Province of Trento

Italy Workplace

CSR

Piano regionale per le politiche del

lavoro 2008-2010.

It gives incentives for enterprises that implemented labour projects such as, part-time jobs; facilitator for paternity and maternity leave. SMEs have 2.600€ incentive for each worker that can have flexibility for two years.

Grant Improvement of labour

conditions

Friuli Venezia Giulia Region

Italy

Accountability

Management system

Regional decree 18/2005

The decree enforces disciplinary regulation for SMEs aiming at adopting CSR tools. The initiatives that could be funded are: the adoption of social and environmental report, and implementation of CSR management systems in accordance with SA 8000

Grant Cost efficiency


Liguria Region Italy

Accountability and

management systems

Workplace

CSR


Regional law 30/2007

It promotes services to improve labour conditions. The Region provides grants to companies and local entities for the adoption of CSR initiatives in the fields of human resources and environmental management; codes of conduct; accountability models. The Region created a database for a socially responsible employers, registered firms can benefit from HR outsourcing initiatives.

Grant Reputation improvement

Cost efficiency


89

Initiatives promoted by Provincial Chambers

of Commerce Italy

Management system

Workplace

CSR


Announcements of competition

proposed by many Provincial

Chambers of Commerce

These Chambers of Commerce issue official notifications to promote the adoption and the implementation of management systems and certifications that are recognized at a national and international levels. They finance projects for first time certification. SMEs can apply for funding for external specialist consultancy, for workers training and for auditing services. Grants vary from each different Chambers of Commerce depending on the typology of certification.

Grant


Reputation improvement

Cost efficiency

National Government Italy

Management system


Law 93/2001.

The organizations that have an EMS which complies with EMAS Regulation can obtain the renewal of some environmental permits. These permits are for air emissions, discharge, and IPPC plants. It allows organizations to bypass the full procedures of renewal of environmental permit.

Mandating instrument


Economic savings

Resource efficiency

Municipalities (e.g. Langhirano, municipalities of

Province of Florence)

Italy

Management system


Local regulations

Some municipalities grant tax breaks for waste collection, especially for waste disposal rate (TIA). The reduction (only in the variable share) only benefits enterprises that have an environmental management system. The initiative intends to provide a tangible benefit for enterprises that invest in the correct environmental management of their activities.

Fiscal incentive


Cost efficiency

State, Regions Italy

Workplace CSR

Management

system

It allows tax credits for enterprises that are EMAS certified . This measure is applied to a wide range of firms to motivate and support SMEs certification. These measures could also be applied to incentive employment of new workers.

Fiscal incentive


Cost efficiency


90

National Government Italy

Management System


Legislative decree 152/2006

Foresee the reduction of expenses, performance bonds and financial guarantees. This measures are part of an initiative which perceive businesses as responsible not only for their ordinary management functions but also, in some specific cases, for remediation of sites or goods and cross-border shipment of waste. ISO 14001 certified or EMAS registered companies are recognised. That initiative aims at mitigating the needs for financial security to cover risks related to discharges in environmentally sensitive areas.

Economic incentive


Cost efficiency

Cortes Generales Governments

Spain Workplace

CSR Law 43/2006.

It is a result of a social dialogue between representatives of industries and unions (included the Spanish confederation of SMEs). The objective is the improvement of employment stability and jobs quality. It contains measures to promote employment; the changing on labour laws improving the temporary contracts; and improvements for unemployed welfare.

Mandating information


State, Minister responsible for equal

opportunities France

Workplace CSR

“Equally Label”.

It was introduced in 2004, and in 2006 it was extended to SMEs. It aims at boosting equality and professional diversity through companies. Enterprises wishing to obtain the label must apply to an independent body (AFAQ – AFNOR). It is a way of recognising companies that wish to demonstrate their long-term commitment for gender equal opportunities in the workplace.




91

Emilia Romagna Region

Italy

Workplace CSR


Management

System

“Social Quality label”.

The region is working on this label based on responsible production criteria and not only on product quality criteria. It seeks to integrate various different schemes and certifications such as SA 8000, ISO 14001, EMAS, Ecolabel and OHSAS 18001.



Cost efficiency

SECTION 2 - EMPIRICAL RESEARCH

QUESTIONNAIRE ANALYSIS

In order to investigate the existing relationship between competitiveness and CSR-related performances, we carried out a specific questionnaire among firms on textile/clothing/tanning sector (the full questionnaire is available on cosmic website).

METHODOLOGY

The questionnaire has been administered in Italy, France and Spain, the three Countries object of our study. During the 2009 spring period we identified the target group, in collaboration with the Chambers of Commerce of each Country involved. Thus, the sectorial trade associations (national and local level) and the sectorial trade unions had a key role on this process of firms identification .

We contacted about 700 firms, in the three countries, from June to October 2009; and we tried to differentiate the origin area (or reference district) of the firms. Another differentiation in which we kept attention was about the affiliation sector: textile, clothing and tanning.

The system used to contact the firms was essentially telephone interviews. In some cases, if asked by the firm, we emailed or faxed the questionnaire. The interviews and data collection were carry out by Sant’Anna research Group (for Italy and France ), the partner Empolese Valdelsa Cluster Development Agency and Fondaca - Active Citizenship Foundation (for Italian area), and Center of innovation and Conceptual development of New Products (CID) of the Universitat de Girona (for Spain).

The structure of the questionnaire was brief and well focused on the topics of CSR and competiveness. Our scope was to reach the greatest number of firms, gathering the essential information to build a solid framework on the real relationship between CSR and competitiveness. The questions were 11, all closed questions except for the second one: "how many employees do you have", which required a number to be inserted.

The questions were divided in three main areas:

• Who is the firm: sector, number of employees, reference suppliers, market and clients (A) • Which CSR tools the firm use: certification, CSR initiatives, choice of suppliers, environmental issue • CSR and competitiveness: the relationship perceived by the firm, and the measure of competitiveness

of the firm in the last 5 years. In the following sections (A, B and C) we’ve synthesized the results of questionnaires; in the final section (D) we’ve briefly outlined a first correlation between CSR and competitiveness variables, on the basis of the obtained results. Further details of data are available in the Appendix.


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A) A FRAMEWORK ABOUT THE FIRMS

The questionnaires totally collected are 274 total: 150 from Italy, 63 from France and 61 from Spain.

These proportions respect the level of diffusion of textile/clothing and leather enterprises in the three countries (see the first report of COSMIC project: Preliminary analysis of textile/clothing sector).

This first part of the analysis is aimed to define a framework about the companies in our sample study. We have tried to balance and diversify the sample. However, we must take into account the variety and complexity of supply chain on clothing/textile/tanning sector, that is very broad and difficult to disentangle, especially amongst SMEs.

Summary of the sight of firms in our sample:

• The questionnaires collected are 274 - 150 from Italy, 63 in France and 61 in Spain. • The prevalent sector is “clothing” with 137 companies, followed by “textile” and “tanning” with 77

firms each (the question could have multiresponses). • The firms have got a mean of 41 employees each, with a minimum of 0 and a maximum of 650. • 41,1% of the suppliers are located in the same nation as the interviewed firm. • The main reference client results to be “other companies of the textile and clothing”, with a 42,5%. • Geographically speaking, the final market is mainly national and other European Countries.

Your company works in which sectors (question 1)

The first question is to identify the affiliation sector of the respondents.

In general, the prevalent sector is “clothing” with 47,1% of the total firms. As evidenced by the data below, some firms marked more than one sector (with a maximum of two), in particular: 16 firms are from both textile and clothing sector, 1 is from both textile and tanning sector (for a total of 291 choices for 274 firms).


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When analysed by country, both Italy and France, present a general equilibrium amongst the three sectors. However both countries have a prevalence of clothing firms. Spain, is also dominated by the clothing sector, with a small percentage of textiles but absent of tanning firms. Italy is the dominant country for tanning with 71,4% of the firms, followed by France with 28,6%. Clothing is the leading sector in Italy and Spain, with 46% and 39,4% of the firms respectively. In France, clothing account for only 14,6% of the sample total. Textiles, on the other hand, is France leading segment with 31% of the firms. Italy has 54,5% of the firms and Spain 14,3%.

How many employees (including part-time, seasonal and home-workers) do have your company? (question 2)

This second question is the only “opened question”. We didn’t propose a range of choice, so the firms could provide us the exact number of employees. In brief we can find a mean of 41 employees, a median of 15, and a mode of 10. We have made a grouping with nine ranges. The more numerous are the first two: between zero and-10 and between 11 to-20, with 61% of the total firms.


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A cross analysis between employees grouping and the three sectors, evidenced a substantial balance.

From a geographical point of view, your suppliers are mainly… (question 3)

At this third question the respondents are 271 (three missing), with the possibility on multiresponses (for a total of 389 choices made). From the total, 41,1% of firms have suppliers mainly at national level; 27,5% are located in other European Countries; 17,2% are from neighborhood areas; and 12,6% are located in Asian Countries.


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Suppliers: geographical area

Italian firms outsource their supplies mainly from local and national suppliers; France and Spain, on the other hand, outsource mainly from national and European suppliers.

Country*Suppliers: geographical area

When analysed by sector, textile and clothing mainly use suppliers from national level. Tanning relies equally onto local and national suppliers.


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Sector* Suppliers: geographical area

What is your main reference client? (question 4)

At this fourth question there are 273 respondents (one missing, multiresponses possible for a total of 325). The main reference client is “other companies of the textile and clothing”, with 42,5% of total; it is followed by large scale/retail trade with 18,2%, other companies from different sector and retail shop with 16,9% each; last final consumer with 5,5%.

Main reference client

When matching “main reference client” data by individual country a considerable differentiation between sectors can be noticed. The Italian clothing sectors has the majority of its clients in the supply chain and retail shops, while the tanning sector concentrates its clients on ‘other companies of textile and clothing’ (60,3%). France is characterised for a more homogenised clients distribution, with the exception of the “other companies but from a different sector” option. However, one must consider that there are less French


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than Italian firms in the sample. Finally, for Spanish position we notice a net prevalence for other companies (from textile/clothing as well from different sector) as main clients; so, the Spanish firms that make up our sample come from a middle range of the entire supply chain.

From a geographical point of view, your final market is mainly… (question 5)

There are no missing answers for this fifth question, and multipleresponses are possible with a total of 425. The final market, geographically speaking, is mainly national (40,5%) and localized in European Countries (33,9%).

When matching data of final market from a geographical point of view and single sectors, a different situation is found in each Country. In Italy, there is a prevalence of local final market in the tanning sector (39,6%), followed by national market (32,9%). The clothing as well as textile sector registered a prevalence of national market (respectively 43,3% and 41,5%), followed by market localized in other European Countries (for both fields roughly 29%). In France, we find a net prevalence of national market for textile (60,6%), and for clothing (48,6%). Opposite to what was observed in Italy in the tanning sector, there is an equitable distribution between national and European markets (37,2%), with a small concentration in local markets. Finally, in Spain the dominant markets are concentrated in EU Countries (others in the clothing sector, and national level for textile).


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B) THE CORPORATE SOCIAL RESPONSIBILITY ON THE FIRMS

What certification do you have? (question 6)

From our sample 127 (46%) firms have at least one certification, 107 of which have more than one. A total of 147(54%) firms do not have any kind of certification. Most firms’ certificates from the clothing sector are in France and Spain. Italy holds most of the certificates for tanning and textile sector respectively.

Not a single firm holds any of the following certificates: SA8000, OHSAS 18001, Ecolabel or EPD. The more widespread certification is the ISO9000, which accounts for 42,5% of certified companies (and 19,7% in total). The “ethical product label” has 32,3% of firms certified (15% in total). Many companies have chosen not identified categories of certification: in general "something else", or referring to “other environmental certification/labeling” (for details about sectorial or local certifications, see section 1.b of this report).

The ISO 9000 family addresses "Quality management". This means what the organization does to fulfill: the customer's quality requirements, and applicable regulatory requirements, while aiming to enhance customer satisfaction, and achieve continual improvement of its performance in pursuit of these objectives.

French companies with ISO9000 certification are 14, the 22,2%; Italian and Spanish percentages are also high, with respectively 19,3% (30 enterprises) and 18% (11 enterprises). With respect to each sector, tanning has a 37,7%, textile 20,8% and clothing 16%.

In respect to the certification in environmental field, the main certifications are : ISO 14001, EMAS and other environmental certification/label.

The ISO 14000 family addresses "Environmental management". This means what the organization does to: minimize harmful effects on the environment caused by its activities, and to achieve continual improvement of its environmental performance. 8% of Italian firms (12 enterprises) are certified ISO14001, as well as the


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4,8% of French (3) and 21,3% of Spanish ones (13). With respect to sector: certificated firms are 7,8% of textile, 10.2% of clothing and 10,4% of tanning.

The EU Eco-Management and Audit Scheme (EMAS) is a management tool for companies and other organizations to evaluate, report and improve their environmental performance. Only Italian firms have EMAS certification, for a total of seven, mainly from the Tanning sector (5); 1 in the textile sector and 1 in the clothing one.

Finally, for the certifications concerning ethical standard, some adhesion for “ethical product label” was encountered. More than half of Spanish firms (60,6%) assert having this certification (39 enterprises), especially in the clothing sector (33). Italian (1,3%) and French (3,2%) companies have low percentages.

What initiatives do you have done over the past 5 years? (question 7)

The aim of this seventh question was to analyze the participation and activism of individual company towards ethical/social initiatives. As evidenced from the list of initiatives proposed (below), different stakeholders were considered to whom the company could turn to. Activities and initiatives outside the company were also investigated, with regard to local community or accession to international initiatives; and finally the CSR auditing/reporting system.

85 firms declared that had not participated or promoted any initiative over the past 5 years. The remaining 189 companies had participated to more than one initiative.

Count

1. Drafting and adoption of codes of ethics and/or codes of conduct 58

2. Benefits for employees (e.g. flexibility of individual working hours, requests for part time contracts, convention with sports and cultural centers, collaborations with trade unions, etc.)

98

3. Sophisticated system for the evaluation of staff (e.g. balance of competences, processes for evaluating the potential etc…)

13

4. Agreements and partnerships with customers and suppliers to promote ethical products and/or eco-compatible (e.g. shared advertising campaigns, manufacturing consortia, etc ...) 29

5. Editing of Social/ Sustainability and/or Environmental Annual Balance or Report 10

6. Adherence to ethical and/or environmental initiatives at international level (e.g. accession to the Global Compact, to standard AA1000)

45

7. Initiatives for the local community (e.g. support for local projects, sponsorship of events promoted by associations or local groups, open doors, etc...)

71


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Looking at country level, we notice that: 63,3% of Italian firms, 55,5% of French firms and 96,7% of Spanish firms had participated at least to one initiative; When analyzing by sector, firms that participated in at least one initiative are: 63,3% from textile, 78,8 from clothing and 58,4% from tanning. Interesting to notice that firm’s size had influenced levels of participation. In each proposed initiative, firms with 10 employees or less had a participation level smaller than the general average.

Which of the following elements do you keep in consideration choosing your suppliers?

(question 8)

The questionnaire proposed some alternatives from which companies could choose. Two of these choices are referred to CSR elements (“environmental compatibility of raw materials, auxiliary products or services purchased” and “If the suppliers have ethical or environmental certifications”); the other three choices referred to quality or price area (“price of raw materials, auxiliary products or services purchased”, “quality of raw materials, auxiliary products or services purchased” and “If the suppliers have quality certifications”). With a percentage of 82,1% the quality of raw materials/products/services is the preferred characteristic considered when choosing suppliers, followed by price with 63,9% of the responses. The possession of an ethical or environmental certification is preferred to a quality certification (22,5% and 13,9% respectively). There is a low percentage of answers regarding the environmental compatibility.


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ANSWER YES/NO

COUNTRY SECTOR

SPAIN FRANCE ITALY TANNING APPAREL TEXTILE

Price of raw materials, auxiliary products or services

purchased

YES 49 45 81 46 92 46

NO 12 18 69 31 45 31

Quality of raw materials, auxiliary products or services

purchased

YES 55 52 118 16 23 14

NO 6 11 32 61 114 63

Environmental compatibility of raw materials, auxiliary

products or services purchased

YES 4 7 26 14 12 16

NO 57 56 124 63 125 61

If the suppliers have quality certifications (e.g. iso 9000)

YES 4 15 19 10 17 12

NO 57 48 131 67 120 65

If the suppliers have ethical or environmental

certifications (e.g. EMAS, SA8000,..)

YES 39 8 15 11 41 14

NO 22 55 135 66 96 63

Data in number of answers

In respect to the 5 answers:

� Price of raw materials, auxiliary products or services purchased: Both from country and sector analysis more than half of companies considered this variable when choosing their suppliers

� Quality of raw materials, auxiliary products or services purchased: this resulted to be the most selected item for firms choosing their own suppliers. Up to 80% of companies selected this indicator, by individual Country and sector

� Environmental compatibility of raw materials, auxiliary products or services purchased: this CSR indicator, concerning the environment, is not largely considered. The higher percentage is in Italy


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� If the suppliers have quality certifications (e.g. iso 9000): although as indicated by the survey, the quality of products/materials are the indicator in which companies pay more attention when selecting their suppliers. However, this characteristic does not appear to be measured by certification and international standards.

� If the suppliers have ethical or environmental certifications (e.g. EMAS, SA8000,..): surprisingly, Spanish firms pay particular attention when choosing their suppliers. The choice is made based on possession of ethical / environmental certification.

Finally, when analyzing the eighth and the third questions (“From a geographical point of view, your suppliers are mainly...”), we find that: price is kept in consideration mainly from Asian suppliers (75,5%); quality from European suppliers (92,5%); quality and ethical/environmental certifications again from Asian suppliers (20,4% and 44,8%). Those that opt for local suppliers keep in consideration the environmental compatibility more than the firm itself (22,3%). [ Bear in mind that the suppliers’ geographical area are: Local for 67 firms, National for 160 firms, Localized in other European Countries for 107, Localized in USA for 2 firms, Localized in Asian Countries for 49 firms, Elsewhere for 4 firms.]

With regard to environmental issues what do you do in your company? (question 9)

This ninth question represents the last indicator to measure CSR performances in companies. There are several choices for proposed actions that can contribute to environmental management. In respect to the different answers:

� The use of internal environmental audits has been indicated by 118 enterprises (43% of total interviewed); this number is high on Spanish firms, 72,1%, followed by Italian 36,7%, and French 30,1%. In relation to sector, tanning has 49,3%, clothing 41,6% and textile 40,2%.

� The measurement of impacts by environmental indicators is carried out by 110 enterprises (40%). From a geographical point of view 60,6% in Spain, 40% in Italy, and 20,6% in France. With regard to the sector: 57,1% of tanning, 38,9% of textile, and 31,4% of clothing firms.

� The participation at a consortium plant is common in Italy (34,7%) especially in the tanning sector (62,3%). Spanish and French firms have 29,5% and 23,8% respectively. Most experiences regard tanning and textile sectors (characterized by higher environmental impacts in their processes). Totally 85 enterprises (31%) answered Yes, while 189 (69%) No

� The use of products with reduced environmental impacts is experimented by 134 enterprises (49%) in respect to 140 (51%); the percentages are 83,6% in Spain, 39,3% in Italy, and 38% in France. In respect to sector, tanning has 53,2%, followed by textile with 46,7% and clothing with 45,9%.


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C) PERFORMANCES OF COMPETITIVENESS

The last question is based on a self-evaluation about some key elements for competitiveness of a company. The aim was to have a large sample of firms, and therefore representative of all countries and sectors participating in the research.

In your opinion, manage the environmental and social elements of your business does also help to maintain better competitive performances or face better the impact of economic crisis? (question 10)

Italy France Spain Total

Not at all, it costs and therefore is counterproductive 10 4 4 18

A little, the social and environmental performances don’t impact with the

competitiveness 48 8 14 70

Enough, also if there is no a direct and strong relation 57 17 33 107

Very much, the social and environmental performances could

influence the competitiveness 19 11 3 33

We don't know 15 20 7 42

Textile Clothing Tanning Total


A little, the social and environmental performances don’t impact with the

competitiveness 19 33 20 70



influence the competitiveness 9 13 13 33


As results show, a large number of enterprises consider social and environmental issues important for maintaining good performances in periods of crisis, also if this relationship is not directly perceived. Low in the three countries is the number of subjects considering this relation clear (only 12%), with a higher percentage of France. At sectorial level, it’s interesting to notice that a large part of enterprises considering rather important these tools for facing the crisis, belongs to the clothing sector (that is the most interested from issues concerning the international supply – chain management). In short, we can say that these topics are perceived important by enterprises of this sector, but not yet as strategic competitive variables.


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For your firm, in the last 5 years, how do you consider…

(1: very bad – 2: scarce – 3: acceptable – 4: good – 5: very good – 6: we don’t know)

(question 11)

The results should represent a trend of the last five years. The higher level of self perceived competitiveness is for “Level of satisfaction about the consideration that your customers and suppliers have of you”, with a mean of 4,05. The fewer level of competitiveness are recorded with “Impact of energy costs” and “invoice trend”, with respectively a mean of 2,84 and 2,79, and a mode of 2 (=scarce).

Descriptive Statistics

N Mean Mode

a) Impact of energy costs 270 2,84 2

b) Invoice trend 271 2,79 2

c) Motivation and participation of company staff 270 3,49 3

d) Productivity of staff 271 3,75 4

e) Level of demand for your products from your traditional clients 272 3,33 4

f) Level of demand for your products from new clients 272 3,12 3

g) Level of technical innovation in your company 269 3,53 4

h) Level of organizational innovation of your company 269 3,22 4

i) Level of satisfaction about the consideration that your customers and suppliers have of you

270 4,05 4

j) Intensity and quality of relationships with local stakeholders 268 3,48 4

k) Ease of access to credit from banks and financial institution 267 3,27 3

l) Level of appeal in your business for new members and partners 267 3,66 6

An analysis for each answer follows.


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a) IMPACT OF ENERGY COSTS

The perception of the impact of energy cost results very negative for the Italian companies (21,6% of “very bad”), and “scarce” for a high percentage of Spanish firms (75%). France registered a 40,3% of acceptable cases. Cross-analyzing the impacts of energy costs and the possession of environmental certification, no improvement is shown. The trend for companies which are certified ISO 14001 and those that aren’t’ is very similar.

ISO 14001 (yes or no) – question 6 * Impact of energy costs: stacked graph

On the other hand, companies that possess a generic certification - “other certification/label” – appear to be in a worse situation, with a higher peak value for "scarce".


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Other environmental certification/label (yes or no) – question 6 * Impact of energy costs: stacked graph

These results tend to confirm an opinion (evidenced in the previous literature review in Iraldo, Testa, Frey, 2009) that only if a Management System is well implemented can give good results in terms of cost efficiency.

b) INVOICE TREND

The level of Invoice trend is considered acceptable for high percentage of French (41,9%) and Italian (41,6%) companies. Pretty much different the situation for Spanish firms, with an 80% of “scarce” invoice trend. With regards to sector, major problems are registered by clothing firms, for which the 59,8% of invoice trend is scarce.


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The picture of the invoice trend for companies with at least one certification does not change compared to the general framework: curve shifted to the perception remains low, with a clear predominance for "scarce" consideration.

Firms with at least 1 certification

With regard to question n° 7 (initiatives), the companies that draw up agreements and partnership with customers/suppliers don’t present differences with companies who don’t. For the more quoted levels of perception, we find the following percentages:

Firms with agreements/ partnership

Firms without agreements/ partnership

Scarce level 34,5% 37,64%

Acceptable level 38% 35,06%

Good level 17% 17%


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c) MOTIVATION AND PARTICIPATION OF COMPANY STAFF (e.g. satisfaction demonstrated by the workers, employees’ suggestions to the firm, level of work integration between employees, etc.)

Smaller firms show a smaller variance between the levels of motivation and participation of staff.

Employees Grouping – question 2 * Motivation and participation staff: stacked graph

It could be useful to understand the relation between the adoption of policies about human resources management and the motivation perceived by companies about their employees. To do that, we can link some answers of the 7th question (initiatives done in the past 5 years, benefits for employees plus system of evaluation) with the 11th (motivation and participation of staff). As we can see, in terms of benefits for employees (such as flexibility of individual working hours, requests for part time contracts, convention with


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sports and cultural centers, collaborations with trade unions, etc.) we have an interesting result (for classes Good and Very good the percentage of Yes is rather high), while there is no relationship between the perception of increase of motivation of staff and the implementation of sophisticated systems for the evaluation of staff (e.g. balance of competences, processes for evaluating the potential etc..)

Very bad Scarce Acceptable Good

Very good

Don’t know

Benefits for employees Yes 1 8 28 47 14 0

No 3 18 79 53 18 1

Sophisticated systems for the evaluation of staff

Yes 0 3 4 3 3 0

No 4 23 103 97 29 1

d) PRODUCTIVITY OF STAFF (e.g. staff skills, quality of work performed, level of not absenteeism, etc..)

Also in this case, smaller firms show a smaller variance between the levels of productivity of staff. However, a peak value on “good level” for each companies’ dimension is also noticed.


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Employees grouping – question 2 * Productivity of staff: stacked graph

The graph below demonstrates a strong connection between the middle ranges “good” and “acceptable” for both motivation and for productivity of the staff.


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e) LEVEL OF DEMAND FOR YOUR PRODUCTS FROM YOUR TRADITI ONAL CLIENTS

The graph below tries to represent the level of demand of products from traditional clients (competitiveness indicator) with the typology of final reference client. In general, an acceptable and good level was perceived for this indicator; and a similar situation was registered when linking this competitiveness variable with final market – geographical point of view (following graph).

The companies with retail shop as final client register a higher level of “acceptable” at the expense of “good”.

Level of demand for your products from your traditional clients * Client – question 4


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Level of demand for your products from your traditional clients * Final market – question 5

f) LEVEL OF DEMAND FOR YOUR PRODUCTS FROM NEW CLIENTS

Again, when comparing data on traditional clients and new clients, it is noticeble that companies that mainly deal with "other companies of the same sector", have a weak perception (bad and scarce) from new clients. Present again the crosses made with the indicator on traditional clients for new clients, we note that for companies that have as customer reference "other companies but from different sector" is less negative the level perceived. In respect to the localization of final market, productions addressed to national and European markets seem to suffer more than the others in terms of new clients.


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Level of demand for your products from new clients * Client – question 4

Level of demand for your products from new clients * Final market – question 5

Does the attractiveness for new client depend on certifications? With respect to the firms of our sample, the curve is flatly moved on higher level, with 42,4% on acceptable (vs 40% general) and 45,3% on good (vs 31% general).


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Firms with at least 1 certification

Even more clearly is the advantage for companies with at least one certification, excluding the quality certification (ISO900): the 52,8% perceived the level of demand for products from new clients as “good”, to the detriment of lower levels.

Firms with at least 1 certification (ISO9000 excluded)


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g) LEVEL OF TECHNICAL INNOVATION IN YOUR COMPANY (e.g. development and launch of new products, use of raw materials or auxiliary products innovative, acquisition of technologically advanced equipment for production, new technologies for abatement of pollutants, new materials to more energy-efficient etc..)

Spanish firms (71,7%) and firms in the clothing sector (48,8%) have shown a good level of technical innovation during the past five years.

The level of technical innovation for the companies with a ISO14001 or an EMAS certification is moved in positive standards. Among the firms who perceived their technical innovation “very good”, the 28% has a certification. Among the firms with an environmental certification (ISO14001 or EMAS), the 64,7% perceived technical innovation as “good” (against 45,5% of who doesn’t have a similar certification).

Technical innovation * Environmental certification (ISO14001 and EMAS)


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h) LEVEL OF ORGANIZATIONAL INNOVATION OF YOUR COMPANY (i.e. new internal figure in charge of areas such as environment and safety, planning tools and training of personnel, etc..)

Now we try to match the possession of one certification (question 6) with the level of organizational innovation. As you can see from the chart below, the 58,5% of the firms with at least 1 certification says that the level of organizational innovation is “good”, compared to 36,4% of total firms (moved on “acceptable level”).

Organizational innovation * one certification


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i) LEVEL OF SATISFACTION ABOUT THE CONSIDERATION THAT YOUR CUSTOMERS AND SUPPLIERS HAVE OF YOU

All companies from three Countries show a “good” level of satisfaction about them.

Consideration of you * Country: stacked graph

Also for the level of consideration from customers and suppliers, the situation does not change significantly between companies who claim to have concluded agreements with customers and suppliers to promote ethical products and/or eco-compatible and those who claim not to have: the companies, generally, have a good sense of their own image.


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Consideration of you* agreements and partnerships

j) INTENSITY AND QUALITY OF RELATIONSHIPS WITH LOCAL STAKEHOLDERS (public authorities and control bodies, associations and local communities, representatives of categories and trade unions, etc..)

Spanish firms had demonstrated a better level of relationships with local stakeholders (good for 79,3%). With a similar trend, Italy and France had a more homogenized distribution of variables More distributed the situation for scarce and good variables.


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Relationships with local stakeholder * Country: stacked graph

Regarding sector, tanning, as well as clothing registered good levels of relationship with local stakeholders. On the other hand, textiles demonstrated a uniform level of responses throughout variables.

Relationships with local stakeholder * Sector: stacked graph

The last choice of question 7 is about the initiatives carried out for local community. The 50% of companies that participated in some local initiatives affirm to have a good relationship with the local community (11,4% “very good”).


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Initiatives for the local community (yes-no)

Finally, if we test the perception of the relations with local stakeholders just for the firms with a CSR certification (no quality certifications, so ISO9000 excluded), we can observe that the curve trend is similar with the general one. However, the percentage of the level “good” is definitely higher: 84% vs. 43%, to the detriment of “acceptable” and “scarce” levels.

Firms with at least 1 certification (ISO9000 excluded)


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k) EASE OF ACCESS TO CREDIT FROM BANKS AND FINANCIAL I NSTITUTION

In relation to competitiveness’ indicator “access to credit” there is a high number of companies in France and Spain that don’t have knowledge about it. Interesting to notice the peak value on “acceptable” level for Spanish companies

Access to credit * Country: stacked graph


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l) LEVEL OF APPEAL IN YOUR BUSINESS FOR NEW MEMBERS AN D PARTNERS (entry of new members, attainment offer, proposals for mergers, etc.)

From a sector point of view, business in general felt that their appeal for new members is not very good. “Textile” registered minor variances between answers (as well as in other indicators) . Very similar are the “tanning” and “clothing” trends, with a value peak on “good” perception.

Appeal in your business for new members * Sector: stacked graph


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D) STATISTICAL CORRELATION BETWEEN CSR AND COMPETITIVENESS

The links between the CSR practices and competitiveness have deeply investigated by researchers and practitioners with different approaches and perspectives but the results are not univocal. The European Commission, in its Annual Competitiveness Report 2008, has provided an overview of these studies clustering the effects of CSR on competitiveness, in 6 indicators of firm’s competitiveness: cost structure, human resource performance, customer perspective, innovation, risk and reputation, management, and financial performance.

In this section we aim at exploring these relationships, by testing whether the effects of CSR practices on firms’ competitiveness are statistically supported.

Firstly, we investigated if there is a statistically significant correlation (by means of Spearman test) between the different measures of competitiveness, as perceived by the sampled organizations, and the adoption of specific CSR initiatives. To measure the competitiveness we used the answers to the question n.11 and built a set of categorical variables.

CSR is a very wide-ranging concept, which is one reason why measuring its uptake and impact presents complex methodological problems The adoption of CSR practices was measured using the set of questions above described, that investigate whether a firm has adopted a specific initiative. According to the classification proposed to the mentioned Report, we tried to retrace the single initiative to the four main areas: workplace, market-place, environment, and community. Furthermore, we create a fifth category including the so-called formal CSR tools, that are structured and complex tools that can have an effect on more than one CSR area as above defined.

The table below shows the results of the correlation analysis between different measures of competitiveness and CSR initiatives. The numbers in bold highlight that the result of correlation is significant and the number of stars represents the level of significance: three stars means the level of significance is more than 99%, while one star means that it is more than 90%.

Formal CSR Initative Environmental related-CSR Workplace-related CSR


Mkt place CSR

ISO 14001

EMAS Ethic label

Other certif.

Audit Monitori

ng system

Raw material and pdt

Codes of Conduct

Benefits employ.

Staff_evaul

Intern._initiat

Local_comm

CSR Report

SC_agreem

GSCM_env

GSCM_envethc

ert

Mar

ket

perf

orm

ance

Turnover 0.0380 0.2021 ***

-0.3542 ***

-0.2908 ***

-0.0925 -0.0268 -0.2193 *** -0.3187 ***

0.1929*** 0.0293 -0.3217 ***

0.1228**

0.1711***

0.0547 0.0294 -0.2093 ***

Demand traditional customers

0.1113* 0.1048* 0.0924 0.0866 0.1080* 0.1384** 0.1107* 0.0713 0.1239** 0.0611 0.0505 0.0991 0.0807 0.0325 0.0789 0.1080*

Demand new customer

0.1382** 0.0681 0.2653 ***

0.2718 ***

0.1546 ***

0.1525** 0.1360** 0.1767*** 0.0219 0.0495 0.2232*** 0.0795 0.0983 0.0958 0.0315 0.2590 ***

Business attraction

0.1489** -0.0522 0.5316 ***

0.5097 ***

0.5314 ***

0.2939 ***

0.3732*** 0.5660*** -0.3150***

-0.0143 0.5826*** -0.188 **

0.0654 0.1684 **

-0.0127 0.5255 ***

Inno

vatio

n

perf

orm

ance

Technical innovation

0.1993 ***

0.1420** 0.1903 ***

0.2244 ***

0.3775***

0.3300 ***

0.3149*** 0.1724*** -0.0723 0.0154 0.2265*** 0.0250 0.1716 ***

0.2332 ***

0.0924 0.2591 ***

Organizational innovation

0.2810 ***

0.1472** 0.3453 ***

0.3693 ***

0.4434 ***

0.3798 ***

0.2995*** 0.3872*** -0.0875 0.0443 0.3949*** 0.0863 0.1629 ***

0.0672 0.1441**

0.3923 ***

Inta

ngib

le p

erfo

rman

ce

Personnel motivation

-0.0855 -0.0243 -0.2765 ***

-0.2575 ***

-0.1102 *

-0.1533 **

-0.1578 *** -0.2796*** 0.1721*** -0.0103 -0.2775 ***

0.0743 0.0939 0.0603 0.0974 -0.1429 **

Personnel productivity

-0.0745 0.0267 -0.4104 ***

-0.3567 ***

-0.2415 ***

-0.2501 ***

-0.2627 *** -0.3345*** 0.2320*** 0.0862 -0.3737 ***

0.1330**

0.0096 0.0462 0.0546 -0.2943 ***

Reputation -0.0397 0.0017 -0.0326 0.0044 0.0884 0.0191 -0.0453 0.0047 0.0772 0.1005 -0.0489 -0.0239 0.0022 -0.0632 0.0808 0.0361

Relation with stakeholder

0.1578** 0.0446 0.3280 ***

0.3131 ***

0.2828 ***

0.3123 ***

0.2548*** 0.3831*** -0.1261** -0.0273 0.3253*** 0.1596**

0.0831 0.1100* 0.1758 ***

0.3110 ***

Relation with credit

0.1319** 0.1861 ***

0.0446 0.0040 0.2282 ***

0.1961** 0.0888 0.0207 -0.1789 ***

-0.0043 0.0323 -0.0499 0.1303 **

0.1139 *

0.1505 **

0.1634 **

*** p < 0.01 ** p < 0.05 * p < 0.1

By describing the results shown in the table, we use some of the key findings of our analysis to test the main hypotheses of our study: which is the relationship between CSR practices and competitive performance?

Summarizing, the results of our correlation test support the following findings:

- According with a number of studies that have argued that CSR can be a route to innovation through the use of social, environmental or sustainability drivers to create new ways of working, new products, services, processes and new market space, our correlation test highlights that, in the investigated sectors, innovation performance is the most competitive measure related to CSR initiatives. In particular, specific environmental practices, much more adequate for SMEs than complex management system such as formal EMS.

- Other CSR initiatives, not environment related, are correlated with innovation, in particular organization performance. The adoption of codes of conduct as well as ethic product label, the participation to international CSR initiative could stimulate organizational innovative changing.

- The adoption of CSR initiatives, not focused on employees such as the definition of benefits for employees (e.g. flexibility of individual working hours, requests for part time contracts, etc.) is not only not correlated with personnel motivation and productivity, but, in some cases, it is negatively and significantly correlated to them. We refer, in particular, to the relation between personnel productivity and some initiatives such as, ethic label, codes of conducts, international initiatives.

- There are strong positive correlation between business attraction, that is the level of appeal in the business for new members and partners (entry of new members, attainment offer, proposals for mergers, etc), and some CSR practices such as ethic labels, codes of conducts, international initiatives, environmental audits, green supply chain practices (considering, in the suppliers selection, that suppliers have an ethical or environmental certification, such as ISO14001, EMAS, SA8000, etc.). Obviously, these results can be interpreted in two ways, attractive business are more sensitive to CSR issues and so the CSR tools are more diffused among organizations. On the contrary, the adoption of such CSS initiatives makes a business more attractive for new members and partners.

- In many cases there is a positive correlation between CSR initiatives and relation with stakeholders. This confirms what clearly emerges in the literature: CSR usually requires dialogue and cooperation with stakeholders, both inside and outside the company; this engagement with external non-profit stakeholders might drive corporate innovative solutions.

- The extent to which CSR can help to drive custody loyalty and demand remains a matter of considerable debate. The first findings of our analysis do not provide positive evidence on this potential effect. In one case, some elements for further investigations emerge. The ethical codes and other ethic and environmental certification are positively correlated with level of demand from new clients (new markets) while it is negatively related to the global trend of turnover. At first glance, this could seem a contradiction, but it could be explained by the fact that some CSR initiatives such as ethic products can attract new customers. However, it is a niche market choice, that can rarely influence the whole turnover.

The analysis of the level of dependency between the CSR practices, on one side, and the competitive performance, on the other, has confirmed the existence of some kind of relations among the two variables, that need to be investigated more in depth.


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For this reason, we applied a regression analysis13 using ordered probit14 models in order to test, for the textile/clothing/tanning sector, the following hypotheses:

H1. Does the adoption of environmental practices stimulate technical and product innovations in an organization?

H2. Does the adoption of an environmental management system complied with ISO 14001 requirements stimulate technical and product innovations in an organization?

H3. Does the adoption of an ethic code of conduct stimulate technical and product innovations in an organization?

The following figure shows the results of the test of hypotheses . We defined an equation with the measures of competitiveness as dependent variables. Analyzing the results of the correlation tests depicted in the previous section, we selected the innovation performance (INNOV) as dependent variable. A factor analysis of the two innovation measures (technical and organizational) (Cronbach’s alpha15 = 0.73) confirmed the existence of a single factor scale.

As independent variable we select the adoption of an environmental management system complied with ISO 14001 (ISO 14001), the adoption of an ethic code of conduct (ETHIC_COD), and environmental practices (ENV_RELATED). Regarding the last variable, a factor analysis of three environmental practices (Cronbach’s alpha16 = 0.72) confirmed the existence of a single factor scale. Furthermore, we considered also the influence organization’s size as exogenous variable.

ethic_cod ....4444111111110000111111117777 ....1111777766669999333366662222 2222....33332222 0000....000022220000 ....0000666644442222222233332222 ....7777555577778888000000003333 empl ....0000000011115555888822228888 ....0000000000009999444411117777 1111....66668888 0000....000099993333 ----....000000000000222266663333 ....0000000033334444222288886666 iso_14001 ....4444222200009999222200009999 ....2222333300000000333344447777 1111....88883333 0000....000066667777 ----....0000222299999999333388888888 ....8888777711117777888800006666 ENV_related ....5555222266660000000088885555 ....000088889999666600005555 5555....88887777 0000....000000000000 ....333355550000333388886666 ....777700001111666633331111 INNOV Coef. Std. Err. z P>|z| [95% Conf. Interval]

Log likelihood = ----555588889999....44449999555544448888 Pseudo R2 = 0000....0000777700001111 Prob > chi2 = 0000....0000000000000000 LR chi2(4444) = 88888888....88881111Ordered probit regression Number of obs = 222266660000

The results deliver good reasons to believe that there is a positive relationship between some CSR practices and innovation performance at firm level.

In detail, the adoption of environmental practices increases the probability that an organization increases the level of technical and/or organizational innovation (the relation is significant at 99% and the coefficient is

13 In statistics, regression analysis refers to techniques for the modelling and analysis of numerical data consisting of values of a dependent variable and of one or more independent variables. The dependent variable in the regression equation is modelled as a function of the independent variables, corresponding parameters ("constants"), and an error term. The error term is treated as a random variable and represents unexplained variation in the dependent variable 14 The ordered probit is a generalization of the popular probit analysis, used for ordinal multinomial dependent variables. 15 Cronbach's alpha ranges from 0 to 1. When alpha is .8 or over, the set of indicators is often deemed sufficiently reliable. Alpha scores of between .6 and .8 are sufficient for measures that have not yet been tested in the literature. 16 Cronbach's alpha ranges from 0 to 1. When alpha is .8 or over, the set of indicators is often deemed sufficiently reliable. Alpha scores of between .6 and .8 are sufficient for measures that have not yet been tested in the literature.


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0.5). The adoption of an EMS complied with ISO 14001 standard is as well as positively related to innovation but the relation is slightly lower and weakly supported at statistical level.

Finally, the third hypothesis tested in our model, is also supported: the adoption of an ethic code of conduct is positively related to the Innovation (the relation is significant at 95% and the coefficient is 0.4).

The statistical tests measuring the fitness of the models show that the LR chi2 test is significant at 99% and the pseudo R square is 0.07.


129

CONCLUSIONS

This analysis aimed at analysing the relationship existing between CSR and competitiveness in the textile/clothing and leather sector, with a particular focus on three EU countries: Italy, Spain and France.

The main topics emerged in this report can be summarized as follows:

- An univocal definition of Corporate Social Responsibility doesn’t exist. After a short outline of different definitions and interpretations of this concept, in our research we’ve decided to follow the institutional definition provided by the European Commission in 2001. It represents indeed an effective, structured and valuable synthesis of CSR definition: “The 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”. Each part of this definition has been specified in detail.

- The absence of an univocal definition of “competitiveness”, both at theoretical and practical level, is mostly due to the variety of perspectives and levels of analysis at which the concept may be considered. Competitiveness is generally defined as “The ability of an ‘entity’ – a country, a region, an industry, a firm – to produce products or services of a superior quality and/or at lower costs than other entities that act in the same economic context”. After an outline of this concept definitions, we’ve detailed a series of variables (import and export performance, market shares, labor and total factor productivity, cost efficiency, etc.) aiming at capturing the concept of competitiveness at firm level. That’s the reference of competitiveness characterizing this research.

- The first section of the document relates to the supply side analysis and innovative processes implemented by enterprises of the textile/clothing and leather sector. In the literature review the most interesting effects demonstrated by researches and case studies in terms of competitiveness are related to the following topics: public image and reputation, rise of labour productivity, reliability in the supply – chain relationships and commercial networking , cost-efficiency and increase of market shares, innovation processes (both from technical and managerial - organizational points of views). Among the evidences, a selection of best initiatives in the sector, aiming at increasing the competitiveness of ethical and environmentally friendly enterprises, have been collected. These initiatives were promoted directly by enterprises (such as AFIRM Group, Elsewear, Clean and Unique, at international level, or Vera Pelle Conciata al Vegetale consortium and Made in Green at national level), and by public actors and, then, adopted by enterprises (such as Ecolabel, EMAS APO and Distintivo de Garantía de Calidad Ambiental). In this section, the third part takes into consideration one of the most important international brands in the apparel sector (GUCCI), as an innovative example of supply chain management sustainability-oriented, aimed at monitoring the entire supply chain. This experience is interesting because it has been carried out in accordance (and in cooperation) with the national sectorial trade union FILTEA – CGIL. GUCCI represents an emblematic example of a harmonized process of CSR - related practices implementation in accordance with one of the main sectorial trade unions, not characterized by a necessity of image recover.

- The second section of this report concerns a marked demand side analysis of which firms in the textile, clothing and leather sector are subjected to. This analysis is supported by a review of the literature and a collection of evidences drawn from firms operating in those sectors in Italy, Spain and France.


130

The academic literature review has provided evidences that consumers’ behavior has been changing in recent years. There is a growing awareness of firm’s behaviors and greater importance is given to ethical practices; according to an EUROBAROMETER (2009) survey, the majority of interviewees affirmed that product’s environmental impact is an important element when selecting products. Nevertheless, the analyzed literature points out that customers awareness about product’s impact and ethical consumption are increasing. Furthermore, an OECD (2007) publication identified that in several cases, a gap between what consumers answer about ‘how much they care’ for CSR and their actual purchasing behavior exists. This study confirms findings from a research in UK which identified that young population does purchase a large share of their clothes from fast fashion retailers, which sell cheap clothes, even though the majority of interviewees declared themselves concern with the environment. As demonstrated by evidences collected in Italy, Spain and France, some firms are already responding to consumers pressures and demands. Some of the encountered evidences had provided a truly global scope of demand side concerns. As the suggested by the evidences, large retailers have already implemented codes of conduct or regulations in order to guarantee their clients with responsible and ethical products. 11 groups of retailing sector operating in the three countries have been taken into consideration in this research and details of their initiatives have been furnished.

- The third section of this report relates to the role of credit and insurance systems in stimulating and

awarding enterprises (and in particular SMEs) adopting CSR – related tools. Differently from the previous sub-sections, this part lacks of the literature review and is composed only by an analysis of the main evidences in the three countries and the description of an experience of excellence in the field of insurance systems. In respect to the collected evidences, these are many and concerning the three European countries (in particular 11 experiences from Italy, 2 from France and 4 from Spain). The collected best practices regard promotions and initiatives carried out by banks and credit institutes in favor of SMEs. These initiatives aim at supporting enterprises oriented to integrate social and environmental concerns into their decisional processes and programmes of investment. This section of evidences is followed by the description of one specific experience concerning the agreement signed in 2004 between an Italian consortium (the Pollution Pool) and the biggest Italian Trade Association (Confindustria) aiming at rewarding (with a discount on policies for environmental risks) the enterprises that implement and certify their Environmental Management Systems. The economic advantage is evaluated in about – 20% of the assurance premium for ISO14001 and EMAS certified enterprises. A specific focus on the textile/clothing and leather sector is given.

- The last section of the desk research aims at surveying the role of policymakers in stimulating and supporting SMEs (in particular those operating in the textile/clothing and leather sectors) to adopt responsible initiatives and CSR – related tools (by means of incentives, fiscal discounts, administrative simplifications, etc.). The first step relates to the collection and analysis of main academic studies and research concerning the relationship between public policies and CSR. The papers provided an overview about public policies and their ability to stimulate the implementation of CSR related tools by sectorial SMEs. Some papers deal with tools and indicators adopted by public authorities, and the advantages deriving from them; others give a review of main policies implemented by national European authorities in the different countries promoting CSR in a competitive perspective. The second step analyzes Evidences; a selection of initiatives, promoted by


131

political institutions in the three Countries which supported or provided incentives for the adoption of CSR related tools and practices by SMEs of the three mentioned sectors, has been proposed. In total 37 public policies have been analyzed, most of which Italian (87%); Spanish 8% and French 5% initiatives represent only a small share. The interest areas of promoted policies concern policies about the Workplace CSR (safety of workers, initiatives anti – discrimination, etc.)

- In the 2nd section of the research, a specific questionnaire among firms on textile/clothing/tanning sector has been diffused. About 700 firms, in the three countries, have been contacted, differentiating them on the basis of the origin area and in respect to the affiliation sector: textile, clothing and tanning. The questionnaires totally collected are 274 total: 150 from Italy, 63 from France and 61 from Spain. These proportions respect the level of diffusion of textile/clothing and leather enterprises in the three countries (see the first report of COSMIC project: Preliminary analysis of textile/clothing sector). A descriptive analysis of answers is available in the sections A and B of the Empirical research section; in respect to the relationship existing between CSR practices implementation and competitiveness, the results are available in the sections C and D. We summarize the most interesting ones:

o the good implementation of an EMS (Environmental Management System), in accordance with international standard, seem reasonably increase the cost efficiency of an enterprise

o enterprises that implemented benefits for employees (such as flexibility of individual working hours, requests for part time contracts, convention with sports and cultural centers, collaborations with trade unions, etc.), affirmed that the motivation and participation of company staff in their activities is high, or very high

o a high number of enterprises (more that 50%) with at least 1 certification (with the exclusion of ISO9000) declared that their market shares, in respect to new clients, in the last five years increased

o the level of technical and organizational innovation for the companies with a certification (in particular ISO14001 and EMAS) is moved in positive standards, with important shares of enterprises evaluating that their processes of innovation are good or very good. This result is confirmed also in the statistical correlation between these variables: the correlation test highlights that, in the investigated sectors, innovation performance is the most competitive measure related to CSR initiatives. Finally, also in the regression analysis, the results deliver good reasons to believe that there is a positive relationship between some CSR practices and innovation performance at firm level. In detail, the adoption of environmental practices increases the probability that an organization increases the level of technical and/or organizational innovation (the relation is significant at 99% and the coefficient is 0.5). The adoption of an EMS complied with ISO 14001 standard is as well as positively related to innovation, but the relation is slightly lower and weakly supported at statistical level. Finally, the adoption of an ethic code of conduct is positively related to the Innovation (the relation is significant at 95% and the coefficient is 0.4).


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o the participation to initiatives with local communities is considered by a high number of enterprises important for increasing their local relationships with institutions and other local actors; also in the statistical correlation we’ve obtained a positive link between CSR initiatives and relation with stakeholders. This confirms that CSR usually requires dialogue and cooperation with stakeholders, both inside and outside the company;

o there are strong positive correlations between business attraction, that is the level of appeal in the business for new members and partners (entry of new members, attainment offer, proposals for mergers, etc), and some CSR practices such as ethic labels, codes of conducts, international initiatives, environmental audits, green supply chain practices (considering, in the selection, those suppliers with an ethical or environmental certification, such as ISO14001, EMAS, SA8000, etc.)

Generally, the collected data (and their elaborations) demonstrated interesting results, that potentially can be further deepened. Other elaboration will be developed in the next months to obtain further interesting indications to the policy makers.


133

STATISTICAL APPENDIX

The following tables are a punctual summary on the data processing done for the questionnaire.

QUESTIONNAIRES COLLECTED

Frequency Percent Valid Percent Cumulative Percent

Valid Italy 150 54,7 54,7 54,7

France 63 23,0 23,0 77,7

Spain 61 22,3 22,3 100,0

Total 274 100,0 100,0

Your company works in which sectors (question 1)

Sector Frequencies

Responses

N Percent Percent of Cases

settore Textile 77 26,5% 28,1%

Clothing 137 47,1% 50,0%

Tanning 77 26,5% 28,1%

Total 291 100,0% 106,2%


134

Crosstabs Case Processing Summary

Valid Missing Total

N Percent N Percent N Percent

textile, clothing, tanning * textile, clothing, tanning 17 6,2% 257 93,8% 274 100,0%

Country*Sector Crosstabulation

Sector


Italy Count 42 63 55 150

% within sector 54,5% 46,0% 71,4%

France Count 24 20 22 63

% within sector 31,2% 14,6% 28,6%

Spain Count 11 54 0 61

% within sector 14,3% 39,4% ,0%

Total Count 77 137 77 274

How many employees (including part-time, seasonal and home-workers) do have your company? (question 2)

N Valid 274

Missing 0

Mean 41

Median 15

Mode 10

Minimum 0

Maximum 650


135

Employees Grouping

Frequency Percent

Valid 0-10 101 36,9

11-20 66 24,1

21-30 24 8,8

31-50 27 9,9

51-80 20 7,3

81-110 9 3,3

111-150 12 4,4

151-200 7 2,6

201- 8 2,9

Total 274 100,0

Employees Grouing * Sector - Crosstabulation

Sector


Employees Grouping 0-10 Count 24 55 27 101

% within $sector 31,2% 40,1% 35,1%

11-20 Count 17 27 26 66

% within $sector 22,1% 19,7% 33,8%

21-30 Count 6 11 8 24

% within $sector 7,8% 8,0% 10,4%

31-50 Count 9 11 9 27


136

% within $sector 11,7% 8,0% 11,7%

51-80 Count 8 12 1 20

% within $sector 10,4% 8,8% 1,3%

81-110 Count 3 5 2 9

% within $sector 3,9% 3,6% 2,6%

111-150 Count 4 6 3 12

% within $sector 5,2% 4,4% 3,9%

151-200 Count 2 5 0 7

% within $sector 2,6% 3,6% ,0%

201- Count 4 5 1 8

% within $sector 5,2% 3,6% 1,3%


From a geographical point of view, your suppliers are mainly… (question 3)

Suppliers Frequencies


Suppliers: geograhical area Local 67 17,2% 24,7%

National 160 41,1% 59,0%

Localized in other European Countries 107 27,5% 39,5%

Localized in USA 2 ,5% ,7%

Localized in Asian Countries 49 12,6% 18,1%

Elsewhere 4 1,0% 1,5%

Total 389 100,0% 143,5%


137

Country * Suppliers Crosstabulation

Suppliers: geograhical area

Local National Localized in

other

European

Countries

Localized

in USA

Localized in

Asian

Countries

Elsewhere Total

Italy 57 100 30 1 13 3 204

France 8 35 36 1 12 1 93

Spain 2 25 41 0 24 0 92

Total 67 160 107 2 49 4 389

Sector*Suppliers Crosstabulation

Suppliers: geograhical area

Local National Localized in other

European Countries

Localized in

USA

Localized in

Asian Countries

Elsewhere

Textile 21 45 23 0 12 1

Clothing 11 85 61 0 34 1

Tanning 41 40 29 2 6 2

What is your main reference client? (question 4)

N Percent Percent of

Cases

Main Large scale retail trade 59 18,2% 21,6%


138

reference

client

Other companies of the textile and clothing 138 42,5% 50,5%

Other companies but from a different sector

than textile/clothing/tanning

55 16,9% 20,1%

Retail Shop 55 16,9% 20,1%

Final consumer 18 5,5% 6,6%

Total 325 100,0% 119,0%

Sector * Client * Country Crosstabulation

Large

scale

retail

trade

Other

companies

of the textile

and clothing

Other

companies

but from a

different

sector

Retail

Shop

Final

consumer

Total

Italy Textile 13 27 6 4 2 52

Clothing 20 28 1 29 5 83

Tanning 4 35 18 1 0 58

Total 37 90 25 34 7 -

France Textile 6 8 2 8 2 26

Clothing 6 8 0 8 1 23

Tanning 7 6 5 6 3 27

Total 19 22 7 22 6 -

Spain Textile 0 11 0 0 0 11

Clothing 9 25 24 2 5 65

Total 9 36 24 2 5 -

From a geographical point of view, your final market is mainly… (question 5)


139

Final Market Geographical area Frequencies


Local 65 15,3% 23,7%

National 172 40,5% 62,8%

Localized in other European Countries 144 33,9% 52,6%

Localized in USA 24 5,6% 8,8%

Localized in Asian Countries 17 4,0% 6,2%

Elsewhere 3 ,7% 1,1%

Total 425 100,0% 155,1%

Sector * Final market * Country Crosstabulation

Final Market Geographical area

Local Natio

nal

Locali

zed in

other

Europ

ean

Count

ries

Locali

zed in

USA

Locali

zed in

Asian

Count

ries

Elsew

here

Total

Italy Textile 10 27 19 5 3 1 65

Clothing 12 45 31 10 5 1 104

Tanning 36 30 17 4 3 1 121

Total 58 102 67 19 11 3 -

Fran

ce

Textile 2 20 11 0 0 33

Clothing 7 18 12 0 0 37

Tanning 3 16 16 4 4 43


140

Total 12 54 39 4 4 -

Spai

n

Textile 1 8 3 1 0 13

Clothing 0 19 42 2 2 65

Total 1 27 45 3 2 -

The Corporate Social Responsibility on the firms

What certification do you have? (question 6)

Count

SA 8000 no 274

yes 0

OHSAS 18001 no 274

yes 0

ISO 14001 no 246

yes 28

EMAS no 267

yes 7

Ecolabel no 274

yes 0

EPD no 274

yes 0

Other environmental certification/label

no 222


141

yes 51

Oecotex 1

Ethical product label no 233

yes 41

ISO 9000 no 220

yes 54

Something else

no 222

yes 48

EN- 13501 1

ISO 9001 1

Norma EN 166002:2006 1

TS 16949 1

Any none 147

Sector * ISO14001 * Country Crosstabulation

Sector *ISO 14001 * Country Crosstabulation

no yes Total firms

Italy Textile 41 1 42

Clothing 60 3 63

Tanning 47 8 55

Total 138 12 150

France Textile 24 0 24

Clothing 17 3 20


142

Tanning 22 0 22

Total 60 3 63

Spain Textile 6 5 11

Clothing 46 8 54

Total 48 13 61

Sector * EMAS * Country Crosstabulation

EMAS

no yes Total firms


Clothing 62 1 63

Tanning 50 5 55

Total 143 7 150

France Textile 24 - 24

Clothing 20 - 20

Tanning 22 - 22

Total 63 - 63

Spain Textile 11 - 11

Clothing 54 - 54

Total 61 - 61

Sector * Other environmental certification/label * Country Crosstabulation

Other environmental certification/label

no yes Total


143


Clothing 62 1 63

Tanning 55 0 55

Total 145 5 150


Clothing 17 3 20

Tanning 22 0 22

Total 59 4 63


Clothing 18 36 54

Total 19 42 61

Sector * Ethical product label * Country Crosstabulation

Ethical product label

no yes Total firms


Clothing 63 0 63

Tanning 55 0 55

Total 148 2 150


Clothing 18 2 20

Tanning 22 0 22

Total 61 2 63



144

Clothing 21 33 54

Total 24 37 61

Sector * ISO9000 * Country Crosstabulation

ISO 9000

no yes Total firms


Clothing 58 5 63

Tanning 40 15 55

Total 121 29 150


Clothing 13 7 20

Tanning 20 2 22

Total 49 14 63


Clothing 44 10 54

Total 50 11 61

What initiatives do you have done over the past 5 years? (question 7)

Count

Drafting and adoption of codes of ethics and/or codes of conduct 58

Benefits for employees (e.g. flexibility of individual working hours, requests for part time 98


145

contracts, convention with sports and cultural centers, collaborations with trade unions, etc.)

Sophisticated system for the evaluation of staff (e.g. balance of competences, processes for

evaluating the potential etc…)

13

Agreements and partnerships with customers and suppliers to promote ethical products and/or

eco-compatible (e.g. shared advertising campaigns, manufacturing consortiums, etc ...)

29

Editing of Social/ Sustainability and/or Environmental Annual Balance or Report 10

Adherence to ethical and/or environmental initiatives at international level (e.g. accession to the

Global Compact, to standard AA1000)

45

Initiatives for the local community (e.g. support for local projects, sponsorship of events

promoted by associations or local groups, open doors, etc...)

71

Country * Initiative Crosstabulation

Code

s of

ethic

s

Benefits

for

employe

es

System

evaluati

on staff

Partnershi

ps with

customers

/ suppliers

CSR

Reporti

ng

Initiatives

internation

al level

Initiatives

local

communi

ty

Tot

al

firm

Italy 12 62 2 18 8 3 50 95

Franc

e

4 23 10 5 0 3 13 35

Spain 42 13 1 6 2 39 8 59

Total 58 98 13 29 10 45 71 189

Sector * Initiative Crosstabulation

Cod

es

of

ethi

cs

Benefit

s for

employ

ees

System

evaluat

ion

staff

Partners

hips

with

custome

rs/

suppliers

CSR

Report

ing

Initiative

s

internati

onal

level

Initiativ

es local

commu

nity

Tot

al

fir

m


146

Textil

e

11 21 3 10 2 9 18 49

Clothi

ng

42 51 9 13 2 36 30 10

8

Tanni

ng

8 32 3 9 6 2 28 45

Total 58 98 13 29 10 45 71 18

9

Employees Grouping * Codes of ethics Crosstabulation

Count

Firm with Codes of ethics % on total firms for employees group

Employees Grouping 0-10 10 9,9%

11-20 11 16,7%

21-30 5 20,8%

31-50 6 22,2%

51-80 12 60%

81-110 4 44,4%

111-150 2 16,6%

151-200 3 42,8%

201- 5 62,5%

Total 58 21,16% of total firms

Employees Grouping * Benefits for employees Crosstabulation

Count


147

Benefits for employees % on total firms for employees group


11-20 29 43,9%

21-30 6 25%

31-50 11 40,7%

51-80 4 20%

81-110 2 22,2%

111-150 4 33,3%

151-200 2 28,6%

201- 4 50%


Employees Grouping * System evaluation staff Crosstabulation

Count

System evaluation staff % on total firms for employees group


11-20 2 3%

21-30 1 4,2%

31-50 3 11,1%

51-80 0 -

81-110 1 11,1%

111-150 2 16,7%

151-200 1 14,3%

201- 2 25%


148


Employees Grouping * Partnerships with customers/suppliers Crosstabulation

Count

Partnerships with customers/

suppliers

% on total firms for

employees group

Employees

Grouping

0-10 4 3,9%

11-20 12 18,2%

21-30 2 8,3%

31-50 7 26%

51-80 1 15%

81-110 0 -

111-

150

2 16,7%

151-

200

1 14,3%

201- 0 -


Employees Grouping * CSR Reporting Crosstabulation

Count

CSR Reporting % on total firms for employees group


11-20 4 6%

21-30 0 -


149

31-50 2 7,4%

51-80 1 5%

81-110 0 -

111-150 2 16,7%

151-200 0 -

201- 0 -


Employees Grouping * Initiatives international level Crosstabulation

Count

Initiatives international

level

% on total firms for employees

group

Employees

Grouping

0-10 6 5,9%

11-20 7 10,6%

21-30 4 16,7%

31-50 4 14,8%

51-80 11 55%

81-110 2 22,2%

111-

150

3 25%

151-

200

4 57,1%

201- 4 50%



150

Employees Grouping * Initiatives local community Crosstabulation

Count

Initiatives local community % on total firms for employees group


11-20 17 25,7%

21-30 8 33,3%

31-50 10 37%

51-80 7 35%

81-110 0 -

111-150 5 41,7%

151-200 1 14,3%

201- 1 12,5%


Which of the following elements do you keep in consideration choosing your suppliers? (question 8)

PRICE OF RAW MATERIALS, AUXILIARY PRODUCTS OR SERVI CES PURCHASED:


no 99 36,1 36,1 36,1

yes 175 63,9 63,9 100,0

Total 274 100,0 100,0


Price no 69 18 12 99


151

yes 81 45 49 175

Total 150 63 61 274


Price no 31 45 31 99

yes 46 92 46 175

Total 77 137 77 274

QUALITY OF RAW MATERIALS, AUXILIARY PRODUCTS OR SER VICES PURCHASED:


Valid no 49 17,9 17,9 17,9

yes 225 82,1 82,1 100,0

Total 274 100,0 100,0


Quality no 32 11 6 49

yes 118 52 55 225

Total 150 63 61 274


152


Quality no 14 23 16 49

yes 63 114 61 225

Total 77 137 77 274

ENVIRONMENTAL COMPATIBILITY OF RAW MATERIALS, AUXIL IARY PRODUCTS OR SERVICES PURCHASED:


Valid no 237 86,5 86,5 86,5

yes 37 13,5 13,5 100,0

Total 274 100,0 100,0


Environment no 124 56 57 237

yes 26 7 4 37

Total 150 63 61 274


Environment no 61 125 63 237

yes 16 12 14 37


153

Total 77 137 77 274

IF THE SUPPLIERS HAVE QUALITY CERTIFICATIONS (E.G. ISO 9000):


Valid no 236 86,1 86,1 86,1

yes 38 13,9 13,9 100,0

Total 274 100,0 100,0


Quality certification no 131 48 57 236

yes 19 15 4 38

Total 150 63 61 274


Quality certification no 65 120 67 236

yes 12 17 10 38

Total 77 137 77 274

IF THE SUPPLIERS HAVE ETHICAL OR ENVIRONMENTAL CERT IFICATIONS (e.g. ISO14001, EMAS, SA8000, etc.):



154

Valid no 212 77,4 77,4 77,4

yes 62 22,6 22,6 100,0

Total 274 100,0 100,0


CSR certification no 135 55 22 212

yes 15 8 39 62

Total 150 63 61 274


CSR certification no 63 96 66 212

yes 14 41 11 62

Total 77 137 77 274

Price of raw materials, auxiliary products or services purchased * Suppliers: geographical

area Crosstabulation


other

European

Countries

Localized

in USA

Localized in

Asian

Countries

Elsewhere Total

Price no 24 64 27 2 12 1 99

yes 43 96 80 0 37 3 172


155

Total 67 160 107 2 49 4 271

Quality of raw materials, auxiliary products or services purchased * Suppliers: geographical

area Crosstabulation


other

European

Countries

Localized

in USA

Localized

in Asian

Countries

Elsewhere Total

Quality no 16 33 8 0 7 0 49

yes 51 127 99 2 42 4 222

Total 67 160 107 2 49 4 271

Environmental compatibility of raw materials, auxiliary products or services purchased *

Suppliers: geographical area Crosstabulation

Loca

l

Nationa

l

Localized

in other

Europea

n

Countrie

s

Localize

d in USA

Localized

in Asian

Countrie

s

Elsewher

e

Tota

l

Environmen

t

no 52 140 90 2 46 3 236

yes 15 20 17 0 3 1 35

Tota

l

67 160 107 2 49 4 271

If the suppliers have quality certifications * Suppliers: geographical area Crosstabulation


156

Local National Localized

in other

European

Countries

Localized

in USA

Localized

in Asian

Countries

Elsewhere Total

Quality

certification

no 59 134 88 2 39 3 234

yes 8 26 19 0 10 1 37

Total 67 160 107 2 49 4 271

If the suppliers have ethical or environmental certifications * Suppliers:

geographical area Crosstabulation

Loc

al

Nation

al

Localize

d in

other

Europea

n

Countri

es

Localize

d in

USA

Localize

d in

Asian

Countri

es

Elsewhe

re

Tot

al

CSR

certificati

on

no 57 141 66 2 27 2 211

yes 10 19 41 0 22 2 60

Tot

al

67 160 107 2 49 4 271

With regard to environmental issues what do you do in your company? (question 9)

Do you conduct internal environmental audits?


Valid no 156 56,9 56,9 56,9

yes 118 43,1 43,1 100,0


157

Total 274 100,0 100,0

Audits * Country Crosstabulation


Audits no 95 44 17 156

yes 55 19 44 118

Total 150 63 61 274

Audits * Sector Crosstabulation


Audits no 46 80 39 156

yes 31 57 38 118

Total 77 137 77 274

Do you measure regularly your impacts with environmental indicators?


Valid no 164 59,9 59,9 59,9

yes 110 40,1 40,1 100,0

Total 274 100,0 100,0

Impacts * Country Crosstabulation


Impacts no 90 50 24 164


158

yes 60 13 37 110

Total 150 63 61 274

Impacts * Sector Crosstabulation


Impacts no 47 94 33 164

yes 30 43 44 110

Total 77 137 77 274

Do you participate in the management of consortium plant (or collective plant) to limit your impacts on

the environment (e.g. consortium purifier plant, a collective energy production, etc...)?


Valid no 189 69,0 69,0 69,0

yes 85 31,0 31,0 100,0

Total 274 100,0 100,0

Consortium plant * Country Crosstabulation


Consortium plant no 98 48 43 189

yes 52 15 18 85

Total 150 63 61 274

Consortium plant * Sector Crosstabulation



159

Consortium plant no 52 120 29 189

yes 25 17 48 85

Total 77 137 77 274

Do you ever have experimented and adopted raw materials or auxiliary products with reduced

environment impacts?


Valid no 140 51,1 51,1 51,1

yes 134 48,9 48,9 100,0

Total 274 100,0 100,0

Products reduced impact * Country Crosstabulation


Products reduced impact no 91 39 10 140

yes 59 24 51 134

Total 150 63 61 274

Products reduced impact * Sector Crosstabulation


Products reduced impact no 41 74 36 140

yes 36 63 41 134

Total 77 137 77 274


160

CSR and Competitiveness

In your opinion, manage the environmental and social elements of your business does also help to maintain better competitive performances or face better the impact of economic crisis? (question 10)

CSR/competitiveness * Country Crosstabulation


CSR/

competitiveness


A little, the social and environmental performances don’t

impact with the competitiveness

48 8 14 70



influence the competitiveness

19 11 3 33

we don't know 15 20 7 42

Total 149 60 61 270

CSR/competitiveness * Sector Crosstabulation


CSR/

competitiveness


A little, the social and environmental performances don’t

impact with the competitiveness

19 33 20 70



influence the competitiveness

9 13 13 33


Total 75 135 77 270


161

CSR/competitiveness * client Crosstabulation

Large

scale

retail

trade

Other

companies of

the textile and

clothing

Other

companies but

from a different

sector

Retail

Shop

Final

consumer

Total

Not at all, it costs and

therefore is

counterproductive

4 8 3 4 2 18

A little, the social and

environmental performances

don’t impact with the

competitiveness

14 44 12 16 1 70

Enough, also if there is no a

direct and strong relation

25 46 31 20 6 106

Very much, the social and

environmental performances

could influence the

competitiveness

11 15 8 4 0 33

We don't know 4 23 1 10 9 42

Total 58 136 55 54 18 269

CSR/competitiveness * Market Crosstabulation


other

European

Countries

Localized

in USA

Localized in

Asian

Countries

Elsewhere Total


therefore is

counterproductive

4 14 7 1 2 0 18

A little, the social and

environmental

performances don’t impact

15 44 38 4 4 1 70


162

with the competitiveness

Enough, also if there is no a

direct and strong relation

24 51 67 11 7 1 107


environmental

performances could

influence the

competitiveness

8 25 18 7 3 0 33

We don't know 12 34 13 1 1 1 42

Total 63 168 143 24 17 3 270

For your firm, in the last 5 years, how do you consider (1: very bad – 2: scarce – 3: acceptable – 4: good – 5: very good) (question 11)

Descriptive Statistics

N Minimum Maximum Mean Mode

Impact of energy costs 270 1 6 2,84 2

Invoice trend 271 1 6 2,79 2

Motivation and participation of company staff 270 1 6 3,49 3

Productivity of staff 271 1 6 3,75 4

Level of demand for your products from your traditional clients 272 1 6 3,33 4

Level of demand for your products from new clients 272 1 6 3,12 3

Level of technical innovation in your company 269 1 6 3,53 4

Level of organizational innovation of your company 269 1 6 3,22 4

Level of satisfaction about the consideration that your customers

and suppliers have of you

270 1 6 4,05 4

Intensity and quality of relationships with local stakeholders 268 1 6 3,48 4

Ease of access to credit from banks and financial institution 267 1 6 3,27 3


163

Level of appeal in your business for new members and partners 267 1 6 3,66 6

Valid N (listwise) 254

IMPACT OF ENERGY COSTS

Impact of energy costs * Country Crosstabulation


very bad Count 32 1 3 36

% within Country 21,6% 1,6% 5,0% 13,3%

scarce Count 39 8 45 92

% within Country 26,4% 12,9% 75,0% 34,1%

acceptable Count 42 25 9 76

% within Country 28,4% 40,3% 15,0% 28,1%

good Count 28 5 1 34

% within Country 18,9% 8,1% 1,7% 12,6%

very good Count 3 4 2 9

% within Country 2,0% 6,5% 3,3% 3,3%

we don't know Count 4 19 0 23

% within Country 2,7% 30,6% ,0% 8,5%


% within Country 100,0% 100,0% 100,0% 100,0%

ISO 14001 * Impact of energy costs Crosstabulation

very bad scarce acceptable good very good we don't know Total

ISO 14001 no 35 82 70 29 7 20 243


164

yes 1 10 6 5 2 3 27

Total 36 92 76 34 9 23 270

EMAS * Impact of energy costs Crosstabulation


EMAS no 36 92 73 30 9 23 263

yes 0 0 3 4 0 0 7

Total 36 92 76 34 9 23 270

Other environmental certification/label * Impact of energy costs Crosstabulation

very

bad

scarce acceptable good very

good

we don't

know

Total

Other environmental

certification/label

no 34 53 71 33 7 22 220

yes 2 39 5 1 2 1 50

Total 36 92 76 34 9 23 270

Question 9 (affirmative answers)* Impact of energy costs Crosstabulation

Impact of energy costs

very

bad


good

we don't

know

Total

internal environmental audits 19 52 23 7 4 10 115

measure of impacts with

environmental indicators 18 49 21 9 5 5 107

consortium plant 16 32 21 9 2 3 83

products with reduced environment

impacts 17 62 30 9 5 8 131


165

INVOICE TREND

COUNTRY * INVOICE TREND Crosstabulation

INVOICE TREND

very

bad scarce acceptable good

very

good

we don't

know Total

Italy

Count 12 40 62 33 1 1 149

% within

Country 8,1% 26,8% 41,6% 22,1% ,7% ,7% 100,0%

France

Count 4 14 26 9 0 9 62

% within

Country 6,5% 22,6% 41,9% 14,5% ,0% 14,5% 100,0%

Spain

Count 1 48 7 4 0 0 60

% within

Country 1,7% 80,0% 11,7% 6,7% ,0% ,0% 100,0%

Total

Count 17 102 95 46 1 10 271

% within

Country 6,3% 37,6% 35,1% 17,0% ,4% 3,7% 100,0%

INVOICE TREND * Sector Crosstabulation

SECTOR


INVOICE TREND very bad Count 7 4 6 17


166



good Count 10 19 19 46




CSR VS Competitiveness* INVOICE TREND Crosstabulation

INVOICE TREND

very

bad


good

we

don't

know

Total

CSR VS

Competitiv.


therefore is

counterproductive

Count 6 8 3 1 0 0 18

% within

CSR/compet.

33,3% 44,4% 16,7% 5,6% ,0% ,0% 100,0%

A little, the social/

environmental

performances don’t

impact with

competitiveness

Count 5 28 24 12 0 0 69

% within

CSR/compet.

7,2% 40,6% 34,8% 17,4% ,0% ,0% 100,0%

Enough, also if there is

no a direct and strong

relation

Count 1 45 39 17 1 4 107

% within

CSR/compet.

,9% 42,1% 36,4% 15,9% ,9% 3,7% 100,0%

Very much, the social

and environmental

performances could

influence the

competitiveness

Count 1 9 12 8 0 3 33

% within

CSR/compet.

3,0% 27,3% 36,4% 24,2% ,0% 9,1% 100,0%

We don't know Count 4 10 16 8 0 3 41


167

% within

CSR/compet.

9,8% 24,4% 39,0% 19,5% ,0% 7,3% 100,0%

Total Count 17 100 94 46 1 10 268

% within

CSR/compet.

6,3% 37,3% 35,1% 17,2% ,4% 3,7% 100,0%

MOTIVATION AND PARTICIPATION OF COMPANY STAFF (e.g. satisfaction demonstrated by the workers, employees’ suggestions to the firm, level of work integration between employees, etc.)

Employees Grouping * motivation and participation staff Crosstabulation

MOTIVATION AND PARTECIPATION STAFF

very

bad


good

we don't

know

Total

Employees 0-10 Count 2 5 36 40 15 1 99

% within

employees 2,0% 5,1% 36,4% 40,4% 15,2% 1,0%

100,0%

11-20 Count 1 7 19 27 12 0 66

% within

employees 1,5% 10,6% 28,8% 40,9% 18,2% ,0%

100,0%

21-30 Count 1 1 13 8 1 0 24

% within

employees 4,2% 4,2% 54,2% 33,3% 4,2% ,0%

100,0%

31-50 Count 0 3 6 15 2 0 26

% within

employees ,0% 11,5% 23,1% 57,7% 7,7% ,0%

100,0%

51-80 Count 0 2 15 2 0 0 19

% within

employees ,0% 10,5% 78,9% 10,5% ,0% ,0%

100,0%


168

Question 7 * motivation and participation staff Crosstabulation

motivation and participation staff

very

bad


good

we don't

know

Total

Code of ethics no Count 2 24 62 94 30 1 213

% within code

ethics ,9% 11,3% 29,1% 44,1% 14,1% ,5% 100,0%

yes Count 2 2 45 6 2 0 57

% within code

ethics 3,5% 3,5% 78,9% 10,5% 3,5% ,0% 100,0%

Benefits for no Count 3 18 79 53 18 1 172

81-

110

Count 0 2 4 3 0 0 9

% within

employees ,0% 22,2% 44,4% 33,3% ,0% ,0%

100,0%

111-

150

Count 0 3 4 4 1 0 12

% within

employees ,0% 25,0% 33,3% 33,3% 8,3% ,0%

100,0%

151-

200

Count 0 2 5 0 0 0 7

% within

employees ,0% 28,6% 71,4% ,0% ,0% ,0%

100,0%

201- Count 0 1 5 1 1 0 8

% within

employees ,0% 12,5% 62,5% 12,5% 12,5% ,0%

100,0%

Total Count 4 26 107 100 32 1 270

% within

employees

1,5% 9,6% 39,6% 37,0% 11,9% ,4% 100,0%


169

employees % within code

ethics 1,7% 10,5% 45,9% 30,8% 10,5% ,6% 100,0%

yes Count 1 8 28 47 14 0 98

% within

benefits 1,0% 8,2% 28,6% 48,0% 14,3% ,0% 100,0%

Evaluation

staff

no Count 4 23 103 97 29 1 257

% within

benefits 1,6% 8,9% 40,1% 37,7% 11,3% ,4% 100,0%

yes Count 0 3 4 3 3 0 13

% within

evaluation ,0% 23,1% 30,8% 23,1% 23,1% ,0% 100,0%

PRODUCTIVITY OF STAFF (e.g. staff skills, quality of work performed, level of not absenteeism, etc..)

Employees grouping * Productivity of staff Crosstabulation

Productivity of staff

very

bad


good

we

don't

know

Total

0-10 Count 1 2 23 51 23 0 100

% within

employees 1,0% 2,0% 23,0% 51,0% 23,0% ,0%

100,0%

11-20 Count 0 2 21 30 12 1 66

% within

employees ,0% 3,0% 31,8% 45,5% 18,2% 1,5%

100,0%

21-30 Count 0 0 9 13 2 0 24

% within ,0% ,0% 37,5% 54,2% 8,3% ,0% 100,0%


170

employees

31-50 Count 0 0 11 14 1 0 26

% within

employees ,0% ,0% 42,3% 53,8% 3,8% ,0%

100,0%

51-80 Count 0 0 13 6 0 0 19

% within

employees ,0% ,0% 68,4% 31,6% ,0% ,0%

100,0%

81-

110

Count 0 0 6 3 0 0 9

% within

employees ,0% ,0% 66,7% 33,3% ,0% ,0%

100,0%

111-

150

Count 0 0 6 5 1 0 12

% within

employees ,0% ,0% 50,0% 41,7% 8,3% ,0%

100,0%

151-

200

Count 0 0 5 2 0 0 7

% within

employees ,0% ,0% 71,4% 28,6% ,0% ,0%

100,0%

201- Count 0 0 5 2 1 0 8

% within

employees ,0% ,0% 62,5% 25,0% 12,5% ,0%

100,0%

Total Count 1 4 99 126 40 1 271

% within

employees ,4% 1,5% 36,5% 46,5% 14,8% ,4%

100,0%

Question 7 * productivity of staff Crosstabulation

productivity of staff

very

bad


good

we don't

know

Total


171

Code of ethics no Count 1 4 59 111 39 0 214

% within code

ethics ,5% 1,9% 27,6% 51,9% 18,2% ,0% 100,0%

yes Count 0 0 40 15 1 1 57

% within code

ethics ,0% ,0% 70,2% 26,3% 1,8% 1,8% 100,0%

Benefits for

employees

no Count 1 3 78 70 21 0 173

% within code

ethics ,6% 1,7% 45,1% 40,5% 12,1% ,0% 100,0%

yes Count 0 1 21 56 19 1 98

% within

benefits ,0% 1,0% 21,4% 57,1% 19,4% 1,0% 100,0%

Evaluation

staff

no Count 1 4 97 117 38 1 258

% within code

ethics ,4% 1,6% 37,6% 45,3% 14,7% ,4% 100,0%

yes Count 0 0 2 9 2 0 13

% within

evaluation ,0% ,0% 15,4% 69,2% 15,4% ,0% 100,0%

Motivation staff * Productivity Crosstabulation

Productivity

very

bad

scarc

e

accepta

ble

good very

good

we

don'

t

kno

w

Total

Motivati

on staff

very bad Count 1 0 0 2 1 0 4

% within

motivati

25,0

% ,0% ,0%

50,0

%

25,0

% ,0%

100,0

%


172

on

scarce Count 0 2 20 3 1 0 26

% within

motivati

on

,0% 7,7% 76,9% 11,5

% 3,8% ,0%

100,0

%

accepta

ble

Count 0 1 66 34 5 1 107

% within

motivati

on

,0% ,9% 61,7% 31,8

% 4,7% ,9%

100,0

%

good Count 0 0 12 77 11 0 100

% within

motivati

on

,0% ,0% 12,0% 77,0

%

11,0

% ,0%

100,0

%

very

good

Count 0 0 1 10 21 0 32

% within

motivati

on

,0% ,0% 3,1% 31,2

%

65,6

% ,0%

100,0

%

we don't

know

Count 0 1 0 0 0 0 1

% within

motivati

on

,0% 100,0

% ,0% ,0% ,0% ,0%

100,0

%

Total Count 1 4 99 126 39 1 270

% within

motivati

on

,4% 1,5% 36,7% 46,7

%

14,4

% ,4%

100,0

%

LEVEL OF DEMAND FOR YOUR PRODUCTS FROM YOUR TRADITI ONAL CLIENTS

Level of demand for your products from your traditional clients * Client Crosstabulation


173

Client

Large

scale

retail

trade

Other companies of

textile/clothing

Other companies

but from a

different sector

Retail

Shop

Final

consumer

Total

very bad 1 4 1 1 0 5

scarce 8 20 4 9 2 37

acceptable 20 53 21 30 5 105

good 28 54 28 13 9 112

very good 2 3 1 2 2 10

we don't

know

0 2 0 0 0 2

Total 59 136 55 55 18 271

Level of demand for your products from your traditional clients * Final market Crosstabulation

Final market

Local National Localized in other

European Countries

Localized in

USA

Localized in

Asian Countries

Elsewhere Total

very bad 1 4 4 0 1 0 5

scarce 7 25 15 1 2 0 37

acceptable 21 66 58 8 5 1 106

good 31 64 61 13 7 2 112

very good 3 9 5 2 2 0 10

we don't

know

0 2 0 0 0 0 2

Total 63 170 143 24 17 3 272


174

Question 7 * Level of demand for your products from your traditional clients Crosstabulation

traditional clients

very

bad

scarc

e

acceptabl

e

good very

good

we

don't

kno

w

Total

agreements

and

partnerships

with

customers

and suppliers

to promote

ethical

products

and/or eco-

compatible

no Count 4 36 93 100 9 1 243

% within

agreements

1,6

%

14,8

% 38,3%

41,2

% 3,7% ,4%

100,0

%

ye

s

Count 1 1 13 12 1 1 29

% within

agreements 3,4

% 3,4% 44,8%

41,4

% 3,4% 3,4%

100,0

%

editing of

Social/

Sustainability

and/or

Environmenta

l Annual

Balance or

Report

no Count 5 36 104 107 9 2 263

% within

social

report

1,9

%

13,7

% 39,5%

40,7

% 3,4% ,8%

100,0

%

ye

s

Count 0 1 2 5 1 0 9

% within

social

report

,0% 11,1

% 22,2%

55,6

%

11,1

% ,0%

100,0

%

adherence to

ethical and/or

environmenta

l initiatives at

international

level

no Count 4 36 85 91 10 2 228

% within

internationa

l init.

1,8

%

15,8

% 37,3%

39,9

% 4,4% ,9%

100,0

%

ye

s

Count 1 1 21 21 0 0 44

% within

internationa

2,3

% 2,3% 47,7%

47,7

% ,0% ,0%

100,0

%


175

l init.

LEVEL OF DEMAND FOR YOUR PRODUCTS FROM NEW CLIENTS

Level of demand for your products from your traditional clients * Client Crosstabulation

Client

Large

scale

retail

trade

other

companies of

the textile and

clothing

Other companies but from a

different sector than

textile/clothing/tanning

Retail

Shop

final

consumer

Total

very bad Count 3 10 3 1 1 14

scarce Count 8 34 3 12 0 51

acceptable Count 24 38 32 31 6 109

good Count 22 47 16 9 10 85

very good Count 2 3 1 2 1 8

we don't

know

Count 0 4 0 0 0 4

Total Count 59 136 55 55 18 271

Level of demand for your products from new clients * Final market Crosstabulation

Final Market

locals nationals localized in other

European Countries

localized in

USA

localized in

Asian Countries

elsewhere Total

very bad 5 9 6 1 3 0 14

scarce 13 35 22 4 2 0 52

acceptable 21 69 67 8 6 2 109


176

good 20 49 43 9 3 1 85

very good 2 6 5 2 3 0 8

we don't

know

2 2 0 0 0 0 4

Total 63 170 143 24 17 3 272

Question 7 * Level of demand for your products from new clients Crosstabulation

new clients

very

bad

scarc

e

acceptabl

e

good very

goo

d

we

don't

kno

w

Total

agreements

and

partnerships

with

customers

and suppliers

to promote

ethical

products

and/or eco-

compatible

no Count 13 49 98 73 7 3 243

% within

agreements 5,3%

20,2

% 40,3%

30,0

%

2,9

% 1,2%

100,0

%

ye

s

Count 1 3 11 12 1 1 29

% within

agreements 3,4%

10,3

% 37,9%

41,4

%

3,4

% 3,4%

100,0

%

editing of

Social/

Sustainability

and/or

Environmenta

l Annual

Balance or

Report

no Count 13 52 107 79 8 4 263

% within

social

report

4,9% 19,8

% 40,7%

30,0

%

3,0

% 1,5%

100,0

%

ye

s

Count 1 0 2 6 0 0 9

% within

social

report

11,1

% ,0% 22,2%

66,7

% ,0% ,0%

100,0

%

adherence to no Count 13 52 90 61 8 4 228


177

ethical and/or

environmenta

l initiatives at

international

level

% within

internationa

l init.

5,7% 22,8

% 39,5%

26,8

%

3,5

% 1,8%

100,0

%

ye

s

Count 1 0 19 24 0 0 44

% within

internationa

l init.

2,3% ,0% 43,2% 54,5

% ,0% ,0%

100,0

%

LEVEL OF TECHNICAL INNOVATION IN YOUR COMPANY (e.g. development and launch of new products, use of raw materials or auxiliary products innovative, acquisition of technologically advanced equipment for production, new technologies for abatement of pollutants, new materials to more energy-efficient etc..)

Country * Technical innovation Crosstabulation

Technical Innovation

very

bad


good

we don't

know

Total

Italy Count 11 13 36 63 21 3 147

% within

country

7,5% 8,8% 24,5% 42,9% 14,3% 2,0% 100,0%

France Count 5 11 18 23 3 2 62

% within

country

8,1% 17,7% 29,0% 37,1% 4,8% 3,2% 100,0%

Spain Count 0 4 8 43 5 0 60

% within

country

,0% 6,7% 13,3% 71,7% 8,3% ,0% 100,0%

Total Count 16 28 62 129 29 5 269

% within

country

5,9% 10,4% 23,0% 48,0% 10,8% 1,9% 100,0%


178

Technical innovation * Sector

Sector


Technical innovation very bad Count 1 9 6 16



good Count 39 66 31 129




CSR/competitiveness * Technical innovation Crosstabulation

Technical Innovation

very

bad


good

we

don't

know

Total


therefore is

counterproductive

Count 3 2 5 6 2 0 18

% within

CSR

competit

16,7% 11,1% 27,8% 33,3% 11,1% ,0% 100,0%

a little, the social and

environmental

performances don’t impact

with the competitiveness

Count 8 9 18 28 3 3 69

% within

CSR

competit

11,6% 13,0% 26,1% 40,6% 4,3% 4,3% 100,0%

enough, also if there is no

a direct and strong relation

Count 2 9 22 62 12 0 107

% within

CSR

1,9% 8,4% 20,6% 57,9% 11,2% ,0% 100,0%


179

competit


environmental

performances could

influence the

competitiveness

Count 1 0 4 20 8 0 33

% within

CSR

competit

3,0% ,0% 12,1% 60,6% 24,2% ,0% 100,0%

we don't know Count 2 8 12 12 3 2 39

% within

CSR

competit

5,1% 20,5% 30,8% 30,8% 7,7% 5,1% 100,0%

Total Count 16 28 61 128 28 5 266

% within

CSR

competit

6,0% 10,5% 22,9% 48,1% 10,5% 1,9% 100,0%

LEVEL OF ORGANIZATIONAL INNOVATION OF YOUR COMPANY (i.e. new internal figure in charge of areas such as environment and safety, planning tools and training of personnel, etc..)

Organizational innovation * Sector Crosstabulation

Sector


Organizational innovation very bad 4 9 3 16

scarce 15 29 10 51

acceptable 30 34 27 85


180

good 22 53 28 98

very good 3 6 6 13


Total 75 134 76 269

ISO 14001 * organizational innovation Crosstabulation

Organizational innovation

very

bad


good

we don't

know

Total

ISO

14001

no Count 16 51 81 77 11 6 242

% within ISO

14001

6,6% 21,1% 33,5% 31,8% 4,5% 2,5% 100,0%

yes Count 0 0 4 21 2 0 27

% within ISO

14001

,0% ,0% 14,8% 77,8% 7,4% ,0% 100,0%

Total Count 16 51 85 98 13 6 269

% within ISO

14001

5,9% 19,0% 31,6% 36,4% 4,8% 2,2% 100,0%

EMAS * organizational innovation Crosstabulation

organizational innovation

very

bad


good

we don't

know

Total

EMAS no Count 16 51 84 93 12 6 262

% within

EMAS 6,1% 19,5% 32,1% 35,5% 4,6% 2,3% 100,0%


181

yes Count 0 0 1 5 1 0 7

% within

EMAS ,0% ,0% 14,3% 71,4% 14,3% ,0% 100,0%

Total Count 16 51 85 98 13 6 269

% within

EMAS 5,9% 19,0% 31,6% 36,4% 4,8% 2,2% 100,0%

Other environmental certification/label * organizational innovation Crosstabulation


very

bad


good

we

don't

know

Total

Other

environmental

certification

/label.

no Count 16 51 77 57 12 6 219

% within other

environmental 7,3% 23,3% 35,2% 26,0% 5,5% 2,7%

100,0%

yes Count 0 0 8 41 1 0 50

% within other

environmental ,0% ,0% 16,0% 82,0% 2,0% ,0%

100,0%

Total Count 16 51 85 98 13 6 269

% within other

environmental 5,9% 19,0% 31,6% 36,4% 4,8% 2,2%

100,0%

Ethical label * organizational innovation Crosstabulation


very

bad


good

we don't

know

Total

Ethical no Count 15 51 82 61 13 6 228


182

label % within ethical

label 6,6% 22,4% 36,0% 26,8% 5,7% 2,6% 100,0%

yes Count 1 0 3 37 0 0 41

% within

6.marchi etici 2,4% ,0% 7,3% 90,2% ,0% ,0% 100,0%

Total Count 16 51 85 98 13 6 269

% within

6.marchi etici 5,9% 19,0% 31,6% 36,4% 4,8% 2,2% 100,0%

ISO 9000 * organizational innovation Crosstabulation


very

bad


good

we don't

know

Total

ISO

9000

no Count 16 43 63 81 8 5 216

% within ISO

9000 7,4% 19,9% 29,2% 37,5% 3,7% 2,3% 100,0%

yes Count 0 8 22 17 5 1 53

% within ISO

9000 ,0% 15,1% 41,5% 32,1% 9,4% 1,9% 100,0%

Total Count 16 51 85 98 13 6 269

% within ISO

9000 5,9% 19,0% 31,6% 36,4% 4,8% 2,2% 100,0%

LEVEL OF SATISFACTION ABOUT THE CONSIDERATION THAT YOUR CUSTOMERS AND SUPPLIERS HAVE OF YOU

Country * Satisfaction about the consideration that your customers and suppliers have of you

Crosstabulation

Satisfaction about the consideration that your customers and suppliers have


183

of you

very

bad

scarce acceptable good very good we don't

know

Total

Italy Count 1 1 31 92 20 2 147

% within

country ,7% ,7% 21,1% 62,6% 13,6% 1,4% 100,0%

France Count 0 0 5 31 21 6 63

% within

country ,0% ,0% 7,9% 49,2% 33,3% 9,5% 100,0%

Spain Count 0 1 5 51 2 1 60

% within

country ,0% 1,7% 8,3% 85,0% 3,3% 1,7% 100,0%

Total Count 1 2 41 174 43 9 270

% within

country ,4% ,7% 15,2% 64,4% 15,9% 3,3% 100,0%

INTENSITY AND QUALITY OF RELATIONSHIPS WITH LOCAL S TAKEHOLDERS (public authorities and control bodies, associations and local communities, representatives of categories and trade unions, etc..)

Country * relationships with local stakeholders Crosstabulation

relationships with local stakeholders


Italy Count 12 27 34 57 12 6 148

% within country 8,1% 18,2% 23,0% 38,5% 8,1% 4,1% 100,0%

France Count 1 12 22 13 4 10 62

% within country 1,6% 19,4% 35,5% 21,0% 6,5% 16,1% 100,0%


184

Spain Count 1 5 4 46 1 1 58

% within country 1,7% 8,6% 6,9% 79,3% 1,7% 1,7% 100,0%

Total Count 14 44 60 116 17 17 268

% within country 5,2% 16,4% 22,4% 43,3% 6,3% 6,3% 100,0%

Relationships with local stakeholders * Sector Crosstabulation

Sector


very bad 3 11 1 14

scarce 11 23 11 44


good 28 62 35 116

very good 7 4 8 17


Total 73 133 77 268

Initiatives for the local community * Relationships with local stakeholders Crosstabulation

Relationships with local stakeholders

very

bad


good

we

don't

know

Total

Initiatives for

the local

community

no Count 11 38 44 81 9 15 198

% within local

community

5,6% 19,2% 22,2% 40,9% 4,5% 7,6% 100,0%

yes Count 3 6 16 35 8 2 70


185

% within local

community

4,3% 8,6% 22,9% 50,0% 11,4% 2,9% 100,0%

Total Count 14 44 60 116 17 17 268

% within local

community

5,2% 16,4% 22,4% 43,3% 6,3% 6,3% 100,0%

CSR VS competitiveness * Relationships with local stakeholders Crosstabulation

Relationships with local stakeholders

very

bad


good

we

don't

know

Total

CSR/

competit

Not at all, it costs

and therefore is

counterproductive

Count 5 6 1 3 1 1 17

% within

CSR

competit

29,4% 35,3% 5,9% 17,6% 5,9% 5,9% 100,0%

A little, the social

and environmental

performances

don’t impact with

the

competitiveness

Count 8 12 19 23 3 4 69

% within

CSR

competit 11,6% 17,4% 27,5% 33,3% 4,3% 5,8% 100,0%

Enough, also if

there is no a direct

and strong relation

Count 0 15 18 60 9 4 106

% within

CSR

competit

,0% 14,2% 17,0% 56,6% 8,5% 3,8% 100,0%

Very much, the

social and

environmental

performances

could influence the

competitiveness

Count 0 3 8 18 3 1 33

% within

CSR

competit ,0% 9,1% 24,2% 54,5% 9,1% 3,0% 100,0%


186

We don't know Count 1 7 13 11 1 7 40

% within

CSR

competit

2,5% 17,5% 32,5% 27,5% 2,5% 17,5% 100,0%

Total Count 14 43 59 115 17 17 265

% within

CSR

competit

5,3% 16,2% 22,3% 43,4% 6,4% 6,4% 100,0%

EASE OF ACCESS TO CREDIT FROM BANKS AND FINANCIAL I NSTITUTION

Country * Ease of access to credit Crosstabulation

Ease of access to credit


Italy Count 21 27 43 36 14 7 148

% within country 14,2% 18,2% 29,1% 24,3% 9,5% 4,7% 100,0%

France Count 1 5 22 8 1 23 60

% within country 1,7% 8,3% 36,7% 13,3% 1,7% 38,3% 100,0%

Spain Count 8 5 42 3 0 1 59

% within country 13,6% 8,5% 71,2% 5,1% ,0% 1,7% 100,0%

Total Count 30 37 107 47 15 31 267

% within country 11,2% 13,9% 40,1% 17,6% 5,6% 11,6% 100,0%


187

LEVEL OF APPEAL IN YOUR BUSINESS FOR NEW MEMBERS AN D PARTNERS (entry of new members, attainment offer, proposals for mergers, etc.)

Country * Level of appeal in your business for new members and partners Crosstabulation

Level of appeal in your business for new members and partners


Italy Count 41 30 14 13 3 46 147

% within Country 27,9% 20,4% 9,5% 8,8% 2,0% 31,3% 100,0%

France Count 12 4 6 2 2 34 60

% within Country 20,0% 6,7% 10,0% 3,3% 3,3% 56,7% 100,0%

Spain Count 0 8 7 37 2 6 60

% within Country ,0% 13,3% 11,7% 61,7% 3,3% 10,0% 100,0%

Total Count 53 42 27 52 7 86 267

% within Country 19,9% 15,7% 10,1% 19,5% 2,6% 32,2% 100,0%

Level of appeal in your business for new members and partners *Sector Crosstabulation

Sector


Level of appeal in your business

for new members and partners

very bad 12 29 13 53

scarce 13 20 10 42


good 13 37 6 52

very good 1 4 2 7


Total 74 134 74 267


188

MAIN BIBLIOGRAPHY

This bibliography doesn’t contain the quotes of the literature reviews.

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Carbon Trust (2004), The European Emissions Trading Scheme: Implications for Industrial Competitiveness, http://www.thecarbontrust.co.uk/carbontrust/.

A. B. Carroll, Corporate Social Responsibility: Evolution of a Definitional Construct, 1999; 38: 268 Business Society

Cagatay, Koska, Mihci (2004), The Impact of Environmental Regulations on Trade and Foreign Direct Investments, Hacettepe University.

I. Davis, The biggest contract, The Economist, London, issue 26th May 2005

A. Dayal-Gulati and M. W. Finn (Eds), Global Corporate Citinzenship, USA, 2007

Depperu D. (2006), La competitività internazionale delle imprese – determinanti, misure, percorsi di successo, ed. Il Sole 24Ore, Milano.

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J. Elkington, Cannibals With Forks: The Triple Bottom Line of 21st Century Business, Stony Creek, 1998

Esty D. C., Porter M. E., Sachs J. et al. (2001), Ranking National Environmental Regulation and Performance: A Leading Indicator of Future Competitiveness, “The Global Competitiveness Report”, New York, Oxford University Press.

European Commission, Green Paper: Promoting a European Framework for Corporate Social Responsibility, (European Commission, Brussels, Belgium), 2001

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189

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W. C. Frederick, Corporation be good: the story of Corporate Social Responsibility, Indianapolis, 2006

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Rose A. K. (1997), Dynamic Measures of Competitiveness: Are the Geese Still Flying in Formation?, FRBSF - Federal Reserve Bank of San Francisco

R. R. Sims, Ethics and Corporate Social Responsibility, Connecticut, 2003

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Zoboli R. (1999), in Cainelli G., Zoboli R. (2004), The evolution of Industrial Districts, Heidelberg, Physica.

Main websites:

- http://www.armandbasi.com/ - http://www.armorlux.com/ - http://www.bancaetica.com/Default.ep3 - http://www.bancopopolare.it/ - http://www.banquepopulaire.fr/ - http://www.bbva.com/TLBB/tlbb/jsp/esp/home/index.jsp - http://www.bccfc.it/home/home.asp - http://www.bnl.it/wps/portal - http://www.cajanavarra.es/es/ - http://www.creditocooperativo.it/ - http://www.e-coop.it/portalWeb/coop.portal - http://www.emilbanca.it/portal/page?_pageid=2681,1&_dad=portal&_schema=PORTAL - http://www.eticasgr.it/ - http://www.gafiart.it/ - http://www.groupe-auchan.com/ - http://www.grupocortefiel.com/en/index.asp - http://www.hm.com/it/ - http://www.inditex.com/en - http://www.intesasanpaolo.com/scriptIbve/retail20/RetailIntesaSanpaolo/ita/home/ita_home.jsp - http://www.lecedre.com/ - http://www.lvmh.com/ - http://www.lvmh.com/ - http://www.mps.it/ - http://www.previsorageneral.com/


192

- http://www.ubibanca.it/pagine/Home-IT.aspx - http://www.unglobalcompact.org/ - http://www.unicreditgroup.eu/en/home.htm - https://www.bancaja.es/ - http://www.cleanclothes.org


193

Authors:

Battaglia Massimo – Sant’Anna School of Advanced Studies

Bianchi Lara - Sant’Anna School of Advanced Studies

Cautillo Anna - Sant’Anna School of Advanced Studies

Espinach Xavier – University of Girona

Ghiringhello Daniel - Sant’Anna School of Advanced Studies

Testa Francesco - Sant’Anna School of Advanced Studies

Project coordinator:

Frey Marco - Sant’Anna School of Advanced Studies

Acknowledgments to:

- ASSA, Associazione Lavorazioni Conto Terzi, Santa Croce s/Arno (PI)

- Associazione Conciatori, Santa Croce s/Arno (PI)

- Associazione Industriali di Firenze, Empoli Department (FI)

- Camera di Commercio, Industria e Artigianato, Pisa

- Camera di Commercio, Industria e Artigianato, Prato

- Chamber of Commerce and Industry of France, Paris

- Confartigianato Empoli (FI)

- Confederazione Nazionale Artigianato, Empoli

- Consorzio Conciatori Ponte a Egola (PI)

- FILTEA CGIL, Firenze

- GUCCI Group, Firenze

- Istituto di Economia per le Fonti dell’Energia e dell’Ambiente, Bocconi University, Milano

- Italian Pollution Pool, Milano

INFO:

Scuola Superiore Sant'Anna – MAIN Lab

P.za Martiri della Libertà, 33 56127 Pisa (Italia)

www.cosmic.sssup.it

[email protected]

csr and competitiveness report cosmic - asev and competitivenes… · 2009 final report of analysis...

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