Tag: #community #CSR #goodintentions

Building A Better Planet: Toward a Sustainable Post-COVID-19 Society

By Daniel C. Esty

Covid-19 has dominated policy thinking across the world for several months – highlighting our vulnerability to unexpected threats, the fundamental reality of global interdependence, the critical role of science and data, and the value of collaborative efforts in response to a common challenge. And when the short-term public health crisis abates, the middle-term focus will be on economic recovery. But we should think now about the longer term – and the need to build a sustainable society that steps up to another looming threat: the prospect of destabilizing climate change.  Thus, as we rebuild our economy, we must do so in a way that moves us toward a clean and renewable energy future as well as addressing other pressing sustainability issues including air and water pollution, waste and chemicals management, and our depletion of natural resources.

To help launch the conversation about the pathways to a sustainable future, I offer below 10 key elements to consider. These concepts build on the ideas laid out in the recently released book, A Better Planet: 40 Big Ideas for a Sustainable Future, that emerged from a multi-year research and policy initiative at Yale University, where I teach. For more information on the Yale Environmental Dialogue, please see the website.

1 ) End of externalities

A sustainable future requires that we commit to an end of externalities as the foundational principle for environmental policy.  This starting point would require that we implement the Polluter Pays Principle, which means that those who release air and water pollution or greenhouse gases would have to stop these harms or to pay for their pollution.  Likewise, any user of public natural resources – including water for irrigation, forests for timber, grasslands for grazing, or public lands for the extraction of oil, natural gas, or minerals – would be required to pay full price for the resources they take. 

To be clear, making companies pay for the harms they cause will expose some business models as fundamentally unsustainable and only profitable when externalities are not internalized.  These enterprises will have to remake their business strategies or go under.

2 ) Change in systems thinking

We must acknowledge that we live in a highly integrated world, as COVID-19 has so painfully made clear.  Complex human and ecological systems require moving beyond traditional siloes to systems thinking — and regulatory design that links energy, environmental, and economic policies.  More fundamentally, we must accept the fact that we will need to pursue multiple goals simultaneously and learn to do so in an integrated way that accepts the reality that our goals will sometimes be in tension — and thus need to be traded off and balanced.

3 ) Top-down targets & bottom-up implementation

We must recognize that policy frameworks and structures require both top-down targets and bottom-up implementation. This lesson has become plainly evident in the climate change context, where it is now clear that presidents and prime ministers do not control all the levers of society that must be pulled to deeply decarbonize our economy.

 To achieve a sustainable future, mayors, governors/premiers, and other subnational political leaders – who often control economic development, transportation systems, and other key points of policy leverage — must play a significant role in reducing greenhouse gas emissions and building a more resilient society.

Likewise, business leaders – who also make day-to-day choices that profoundly shape the prospect for moving society onto a sustainable trajectory – must also be included in this conversation.  Fortunately, both the 2015 Paris Climate Change Agreement and the UN Sustainable Development Goals (SDGs) expressly acknowledge the need for broader engagement of exactly this kind.  

4 ) New economic model

New policy tools must replace the 20th Century command-and-control regulatory model with economic incentives and other market mechanisms.  While the government mandates of the past have allowed us to dramatically reduce pollution levels compared to five decades ago, further progress depends on price signals and a commitment to making emitters pay for the harm they cause.

5 ) New roles & various actors

Environmental progress must recognize new roles for various critical actors.  Specifically, in decades past, the business world was seen as the source of pollution problems. But today, most corporate leaders recognize the need to be good environmental stewards so as to maintain their company’s social license to operate. They recognize that old notions about the mission of corporations being centered on shareholder primary and the maximization of profits has given way to a stakeholder model in which businesses have responsibilities not only to shareholders, but also to their customers, suppliers, employees, and the communities in which they operate. 

Individuals are also advancing sustainability in new and important ways that go well beyond their long-recognized role as voters. Specifically, individuals today can make a difference as green consumers who make choices every day about which products to buy and which companies are selling sustainable goods and services. Likewise, a growing set of sustainability-minded investors are tracking environmental, social, and governance (ESG) performance metrics to ensure that their portfolios align with their values – and they hold shares in companies that are showing the way toward deep decarbonization and sustainability more generally. 

And some impact investors are putting money directly into sustainability projects and enterprises with an expectation that their funds will make a difference in society as well as a financial return.

  Finally, all of us with a smartphone can serve as watchdogs — capturing and sharing evidence of environmental wrongdoing on social media.  We are also all positioned to offer comments and participate in public environmental debates in many places and ways that were not possible prior to the Internet era.  This expanded access should deepen public participation and improve the diversity of perspectives that get factored into policy decisions.

6 ) Sustainable markets

We need sustainable markets that incorporate new lessons from various emerging fields of science and other emerging academic disciplines. Industrial ecology, for instance, offers new methodologies for mapping the flows of energy and materials across the economy.  In this regard, as we rebuild business in the many sectors devastated by the Covid-19 pandemic, we should look sector-by-sector for opportunities to create closed loop production processes that generate zero waste.  Such a system would focus on water recapture and the reuse and recycling of other materials.

We might, in this spirit, shift away from plastic packaging that generates greenhouse gas emissions as it is produced and too often accumulates after use in the ocean – and move toward fiber-based materials that can be more easily recycled or composted.

7 ) New tools & Big Data

Policymakers have a set of new tools at their disposal that can be deployed in support of a sustainable future.  Big Data, in particular, has abundant applications that can help us to reduce environmental impacts – tracking emissions, identifying best practices in pollution control and natural resource management, and providing metrics that help us to identify policy leaders to emulate and laggards who should be spurred to do better.  And while 21st information and communications technologies have transformed how sports teams pick players, businesses market to their customers, and all of us make purchases, technological solutions have done rather little to reshape the environmental realm.  But recent advances in data analytics, genomics, artificial intelligence, and machine learning all show significant promise for having important environmental applications.

8 ) Ethical foundation

We must build an ethical foundation for 21st Century sustainability that captures the public’s evolving thinking about core values and fundamental principles. Most notably, the idea of environmental justice and concerns about equity and inequality make it clear that our policy programs must pay attention to who benefits from environmental commitments and who gets ignored.

Indeed, who pays for environmental inaction – including lead exposure from aging water pipes or asthma risk when urban air pollution is not abated – has become a fundamental question. 

As we seek to “build back better” after COVID-19, climate change equity issues need to be given a more prominent role – both the intergenerational burden that the build-up of greenhouse gases in the atmosphere threatens to leave for today’s young people and the reality that movement toward a clean energy future will dislocate some communities, industries, and demographic groups in ways that will require transition assistance.

9 ) New ways of communication

We need a new approach to environmental communications and a commitment to translate expert guidance and science to the public in a manner that makes sense to everyday citizens. Tony Leiserowitz and the Yale Program on Climate Change Communication have demonstrated, for example, that political leaders must learn to distill and effectively translate scientific concepts and results to the public.  And as Thomas Easley makes clear in his Better Planet essay “Hip Hop Sustainability,” we need new strategies that bring the climate change conversation to inner cities and other subsets of society in a way that engages those communities in their own language and on their own terms.

10 ) Innovation

Finally, a spirit of innovation must permeate the push toward a sustainable future.  To create an environmental policy framework that is lighter, faster, and more effective than our regulatory programs of the past, we must harness the entrepreneurial capacity and creativity that exists all across the world.  Innovation broadly-conceived has already brought us technology breakthroughs in wind, solar, tidal, wave, and fuel cell power. But we must seek innovation beyond the technology domain. We need to be equally committed to fresh thinking and new approaches to finance and investments in clean energy, government policies and incentives, public engagement strategies, and public-private partnerships. 

Such innovation can reduce the cost of creating a sustainable future and diminish the perceived tradeoff between environmental progress and economic prosperity.

Despite recent challenges, the promise of a more sustainable society seems ever closer, but still just over the horizon.  Progress thus depends on sustainability pioneers who are willing to run out front, innovate broadly, take on risks, accept failures (and redeploy resources quick when unsuccessful pathways are identified), and redouble their commitment to efforts that show promise.

This commentary builds on Dan Esty’s April 2020 virtual lecture at Copenhagen Business School and the University of Copenhagen.

About the author

Dan Esty is Hillhouse Professor of Environmental Law and Policy, Yale School of Forestry & Environmental Studies and Yale Law School

More about Covid-19 pandemic on Business of Society blog:

Small, yet important – and still responsible. Reflections on SMEs and social responsibility in times of Covid-19

How the pandemic can reset cities and transform aspects of urban mobility

The Coronavirus Pandemic – and the Consequentiality of Metaphors

Sustainable Development, Interrupted?

The Political Economy of the Olympics – Misconceptions about Sustainability

Supply Chain Responsibilities in a Global Pandemic

A Green and Fair COVID-19 Recovery Plan

In Movement from Tanzania to Northern Italy to Denmark

How to make food systems more resilient: Try Behavioural Food Policies

Lobbying and the virus – three trends to take note of

Image by Free images

Small, yet important – and still responsible. Reflections on SMEs and social responsibility in times of Covid-19

By Søren Jeppesen

One thing seems to be clear by now – that we are all challenged by the effects of the Covid-19 pandemic. This includes all enterprises, large as well as small firms. As states and individuals, also SMEs (Small and Medium-size Enterprises) need to figure out how to respond. SMEs constitute the vast majority of enterprises on the Globe, and their response to the current situation, including how they behave in terms of social responsibilities matter a lot. If jobs disappear, or wages are lowered and/or working conditions deteriorate, a large number of persons (employees) and families will be negatively affected. If environmental standards are lowered the nature and humans will be negatively affected.

The perception of what constitutes social responsibilities varies substantially across countries. As SMEs in different parts of the world face very different situations (see Spence et al. 2018), also in times of Covid-19, the responses will be very different. We already witness intense debates on what is the ‘appropriate way’ of reacting. Most SMEs have a less formalized way of operating compared to larger firms. While this is viewed as leading to being less socially responsible compared to large firms this type of organizing – not being so standardized – maybe be is an advantage in an unknown situation like the one that we are witnessing right now. Agility, creativity and ability to make a decision fast could be an advantage right now like the Danish small firms that have adjusted their production to include critical health products show.

However, the examples are probably the exceptions rather than the rule as only a smaller section of the SMEs typically can be characterized like this. The majority of the SMEs are operating in more traditional, standardized ways and have a more limited range of responses as things stand right now.

In our part of the world, governments have implemented numerous support schemes trying to assist the private sector, including SMEs, in various ways. The Danish SME has various public-funded support packages and a highly formalized labour market cushioned by a number of social benefit programs to factor into the considerations. Hence, we can insist that an important part of managing continues to be keeping an eye on working conditions and the environmental impact. In other parts of the world like the developing countries, governments have so far done less and given the much more informal nature of the economies, SMEs are much harder effected.

The Ugandan SME is faced with no economic assistance and a complete lockdown of the society leading to a dramatically reduced – if not totally halted – operation and turnover. In addition, no social benefits exist to assist employees who are losing their job. So, the overarching topic concerns the socio-economic dimensions of how many SMEs that survive while retaining a good number of the staff – or on the more pessimistic side – how many that go down leaving scores of people unemployed and without an income affecting individuals as well as tons of families.

What can we then expect in terms of social responsibilities in such a situation? Given that some developing country SMEs are characterized as having ‘family-like culture’, we would expect such enterprises to retain the employees (Tran and Jeppesen, 2016). Even though the SMEs retain the employees, owners and managers personally have to handle the insecurity that accompanies the situation as well as relating to the concerns among the employees.

The family-like type of organization could ensure that employees are kept and not fired. Still, we know that a number of SMEs pay little if any wages in times of limited production. Hence, having a job with no income does not make a difference right now.

Small enterprises in developing countries are also praised for their community engagement in taking up activities ensuring women (Langevang et al, 2015) or young people income. The localized response may assist in various ways of helping citizens in dire need. Religion and which church that you are a member of play a role. Some churches, as well as the wealthier members (and among these SME owners and managers), come forward to assist their congregation and the less well-off families in times of need. 

We need to wait for the answer to whether and to what extent Covid-19 will be marked by resilience and a protective and more caring (social) response by SMEs – or rather by the tough reality of downsizing and/or closing down with numerous dire consequences.

References

Langevang, T., Gough, K. V., Yankson, P. W., Owusu, G., & Osei, R. (2015). Bounded entrepreneurial vitality: The mixed embeddedness of female entrepreneurship. Economic Geography, 91(4), 449-473.

Spence, Laura J., Jedrzej George Frynas, Judy N. Muthuri, Jyoti Navaret, 2018. Research Handbook on Small Business Social Responsibility: Global Perspectives. Edward Elgar Publishing.

Tran, Angie Ngoc & Søren Jeppesen. 2016. SMEs in Their Own Right: The Views of Managers and Workers in Vietnamese Textiles, Garment, and Footwear Companies. Journal of Business Ethics, 137(3), 589-608

About the author

Søren Jeppesen is Associate Professor at the Department of Management, Society and Communication at Copenhagen Business School. His research concerns the development of firms in developing countries. He focuses on SMEs, CSR and driving forces (or lack of same) for strategies of SMEs in developing countries in engaging in CSR (or not engaging).

More about coronavirus pandemic on Business of Society blog:

How the pandemic can reset cities and transform aspects of urban mobility

The Coronavirus Pandemic – and the Consequentiality of Metaphors

Sustainable Development, Interrupted?

The Political Economy of the Olympics – Misconceptions about Sustainability

Supply Chain Responsibilities in a Global Pandemic

A Green and Fair COVID-19 Recovery Plan

In Movement from Tanzania to Northern Italy to Denmark

How to make food systems more resilient: Try Behavioural Food Policies

Lobbying and the virus – three trends to take note of

Image by US Army Africa

On the Ground: What CSR and sustainability standards fail to address

By Hannah Elliott

In the fall of 2019, there was a flurry of news stories in the British media about political events in western Kenya which, according to one article, threatened the future of the nation’s beloved cup of tea. In Kericho, the heart of Kenya’s tea-growing country, the local community are reclaiming vast tracts of land obtained under British colonialism for the large-scale cultivation of tea. Faced with a land shortage that hinders possibilities for sustainable development, local activists are challenging the extensive land acquisitions that took place under colonial rule, many of which constitute the premises of multinational agri-business today. CSR initiatives and the sustainability standards that are increasingly ubiquitous in Kenya’s tea industry fail to address or acknowledge a sustainability issue that is of major concern to local communities on the ground: land.

During the early 20th century, while trying to create an export economy in eastern Africa, the British government identified the highlands of Kericho in Kenya’s fertile Rift Valley as a place of high agricultural potential and gave out land to European settlers. The area was identified as an ideal place for growing tea, a commodity that was already thriving elsewhere in the British Empire. With the entry of two major companies engaged in tea production in India and Sri Lanka, further land allocations were made, providing the premises for the expansive tea plantations that dominate Kericho’s landscape today.  

Colonial laws enabled these land allocations: the British government could acquire land and relocate the ‘natives’ who were occupying and cultivating it. The Kipsigis community living in the Kericho area lost large amounts of land, only to be compensated with smaller areas of less agriculturally conducive land in designated ‘native reserves’. Others remained in their home areas but were rendered ‘squatters’ required to work for settlers in return for their continued occupation.

Many today struggle to make a living from diminishing farms in the former native reserve areas as family land is subdivided among children, while others remain landless or forced to purchase land at high prices. Land shortage poses a direct challenge to sustainable livelihoods in Kericho.

These grievances are what the Kericho County Governor seeks to address. Identifying as a victim of historical land injustices himself whose ancestral land lies within the vast tea plantation owned by the multinational giant Unilever, he advocates for reparations that acknowledge the forceful acquisition of his community’s land. This implicates multinational tea companies directly. For the Governor and Kipsigis community activists campaigning for justice, these companies are operating on stolen property that rightfully belongs to the community.

Tea plantations employ large numbers of locals in roles that range from tea plucking to top management and offer opportunities and bursaries for adult and child education. While much of the British media coverage of Kericho’s land politics, including an article in The Economist, has envisaged Zimbabwe-like evictions of British companies in Kenya, the Kericho Governor made clear when I met with him earlier this year that it is not in anybody’s interests for the tea companies to hand over the land and leave.

Rather, following recommendations made by Kenya’s National Land Commission, the Governor asks that tea companies apply to the county government for new land leases, following which the land can be resurveyed.  Undeclared acreage, he argues, should then be reverted back to the county government. In addition, the Governor seeks to increase land rent so that the county government is more adequately remunerated for the land.

This, along with demanding mesne profits from multinationals for the use of the land since 1902, is intended to enable more equitable redistribution of the wealth generated from large-scale tea production.

One Kipsigis community activist whom I met envisaged a new model of business: a continuation of plantations’ management and operations, but with the local community, the ‘rightful landowners’, as the major shareholders. This is not to say that all of these proposals are wholly feasible or realistic for tea companies, but to envisage other ways of doing business whereby local communities and authorities are rendered more equal partners.

This goes beyond CSR initiatives which, while valued in Kericho, can be seen as a continuation of colonial paternalism rather than rethinking the very premises of companies’ local engagement. It also goes beyond the certified sustainability standards provided by organisations such as the Rainforest Alliance and Fair Trade that seek to ensure economic, environmental and social sustainability in the tea supply chain yet are generic, driven more by the demands of distant buyers in Europe and North America than those of local communities on the ground.

Undoubtedly, community land claims in Kericho are entangled in local politics. The Kericho Governor’s campaigns are part of a populist political strategy that has seen him win two terms in office. Furthermore, judging by Kenya’s postcolonial history, there is no guarantee that relinquished land or funds would be equitably rolled out to the community should he succeed. Another caveat relates to major challenges facing the tea business in recent years with regard to profitability: at the time of my fieldwork earlier this year, the price of tea hit an all-time low.

The coronavirus pandemic will surely further threaten the industry. In this context, local political challenges of the kind we see in Kericho might push companies to reconsider their operations entirely.  

However, this shouldn’t preclude reimagining the terms of companies’ engagement, not only in Kenya but across Britain’s former settler economies. If large-scale agri-business is to face up to the challenges of sustainability in the places it operates, it must acknowledge the historical grievances attached to the ground beneath it and engage with local communities beyond the confines of CSR and sustainability standards.    

About the Author

Hannah Elliott is a Postdoctoral Research Fellow at CBS’ Department of Management, Society and Communication. Her research on the SUSTEIN project critically examines the production of certified sustainable Kenyan tea.

Image by ©2010CIAT/NeilPalmer

How SDGs help us see buildings through a different lens

By Ingrid Reumert

Despite a lot of focus on climate change recently, the impact of one ‘hidden climate’ on people’s lives often goes unnoticed – the indoor climate. And the indoor climates in the buildings that we normally feel most comfortable in – our homes – are much worse than we are aware of.

Safe and sound at home?

Our homes are traditionally seen as places where we recharge our batteries. They are where we seek shelter and refuge from the hustle and bustle that we often experience in our everyday lives when away from them. As we wind down at the end of a busy day in the comfort of our homes, we take it for granted that we can relax, knowing that our health is not at risk when inside.

However, there’s increasing evidence that although we might arrive home safe and sound, the time we spend at home might not be safe and sound after all.

As ‘safe as houses’?

The saying ‘it’s safe as houses’, which is used to describe things as being completely safe, cannot be used about many homes in Europe. We know from our Healthy Homes Barometers, an annual research-based report designed to take stock of Europe’s buildings, that one out of six Europeans lives in unhealthy homes. For children in Europe, it’s worse, with one out of three being exposed to health risks in their homes. And the health risks are not just isolated to our homes. The same also goes for the environments inside buildings where we work and learn.

Furthermore, we know that people spend 90 percent of their time indoors, where the air can be up to five times more polluted than outside. The potential risks to people’s health and wider society are not insignificant, with poor indoor climates directly leading to conditions such as asthma or allergies, due to dampness and mould.

Ongoing dialogue and modified solutions

For years we have been using such well-documented research to engage in dialogues with legislators, housing professionals, building owners and industry representatives to push for steps to make buildings healthier. In recent years, we have also modified our solutions, which bring daylight and fresh air through roofs, to be more automated and also compatible with digital technologies and the internet of things, and thereby make creating healthy indoor climates hassle-free.

Using SDGs to push harder for healthier indoor climates

At VELUX Group, it is our strong belief that if indoor climates are not good for our health, then we’ll see problems for individuals and for society. Now, with the help of the United Nations Sustainable Development Goals, we have an extra toolbox to support our efforts to address this.

We believe that by embracing this common global language of SDGs, we can leverage our efforts to make buildings healthier.

More specifically, we use three SDG goals to help people see the world through a different lens and to reveal the possible negative effects on their health from the ‘hidden climate’ – the indoor climate. We do this by showing how good indoor climates and healthy buildings can safeguard good health and well-being (SDG 3) and also how this can contribute to more sustainable cities and communities (SDG 11), with the help of partnerships for the goals (SDG 17).

Revealing what’s right under our noses for a more sustainable future

With much of the current climate change and sustainability focus on natural renewable energy sources or companies’ steps to reduce their carbon footprints, the climates inside our homes and other buildings, and their potential negative effects on our health and well-being continue to be ignored. That’s why the VELUX Group will persist with research and activities to boost indoor climate awareness and continually improve our products, to address what’s right under our noses but often overlooked – the indoor or hidden climate. By improving indoor climates to help make buildings healthier, we are confident that we will contribute to a more sustainable future.

About the Author

Ingrid Reumert – VP, Global Stakeholder Communications & Sustainability at VELUX Group

Photo by Timothy Buck on Unsplash

Further reading: Researchers in BLOXHUB seeking to improve indoor climate

Social Enterprises = Sharing Economy Organizations?

By Johanna Mair, Nikolas Rathert and Georg Reischauer.

Sharing Economy Organizations

Uber, Airbnb, and Lyft are frequently cited and popular examples of new organizational forms operating in the sharing economy, which is growing at a stunning pace. One way to make sense of the sharing economy is to conceive it as a web of markets in which individuals use diverse forms of compensation to transact the redistribution of and access to resources (Mair & Reischauer, 2017).

These transactions are mediated by a digital platform run by an organization that focuses on the governance of these transactions (Reischauer & Mair, 2018a, b). Besides the focus on platform-enabled business models, the sharing economy has also spurred discussions about the implications of the sharing economy for society. Many commentators have argued that the sharing economy can become key in making modern societies more environmentally sustainable (Frenken & Schor, 2017) and inclusive (Etter, Fieseler, & Whelan, forthcoming). This debate parallels the debates on another important organizational form, social enterprises (Mair & Rathert, 2019).

Social Enterprises

Social enterprises encompass a diverse set of legal and organizational forms that use market means to effect social change (Mair & Marti, 2006). They address a range of social problems on different scales, including local communities and countries, and target societal groups that usually remain outside the reach of both commercial markets and state-run welfare schemes (Mair, Wolf, & Seelos, 2016). Social enterprises use a variety of commercial activities, including the selling of products and services, and include beneficiaries in various stages of the value creation chain (Mair & Martí, 2006; Mair, Battilana, & Cardenas, 2012). As this discussion suggests, social enterprises might have much in common with sharing economy organizations.

Social Enterprises = Sharing Economy Organizations?

Social enterprises and sharing economy organizations are both alternative forms of organizing that have developed to overcome the deficiencies of contemporary capitalism (Mair & Rathert, 2019). But what are the similarities and differences of these forms, especially with respect to dimensions that have been identified as relevant for both forms, community (Fitzmaurice et al., forthcoming; Venkataraman, Vermeulen, Raaijmakers, & Mair, 2016) and growth (Mair & Reischauer, 2017; Seelos & Mair, 2017)?
We shed light on this question with a comparative analysis of a sample of German social enterprises and sharing economy organizations, which we surveyed in 2015/2016 (social enterprises) and 2018 (sharing economy organizations). This sample encompasses 108 social enterprises and 233 sharing economy organizations that can be meaningfully compared along several indicators, including age and profit orientation. These organizations span a variety of activity fields (e.g., health care and education in the case of social enterprises, or mobility and accommodation in the case of the sharing economy).

Social Enterprises ≠ Sharing Economy!

Our analysis provides first insights that social enterprises and sharing economy organizations are, in fact, quite different animals when it comes to community and growth.
Asking both about the role of community for improving existing products, the community seems more relevant for social enterprises (Figure 1). In fact, on a 7-point scale, social enterprises’ score is over 6 on average, compared to 3.9 for sharing economy organizations. This difference remains significant after controlling for age, profit orientation, and activity field.

Figure 1: Role of Community for Product Improvement

There are also differences when asking about the role of community for entering new markets. As shown in Figure 2, sharing economy organizations use the community for this purpose to a slightly greater extent (using a yes/no variable whether or not they use the community for this purpose, with the difference being statistically significant). At the same time, the salience of the community for this purpose appears as overall lower than for product improvement.

Figure 2: Role of Community for New Market Entry

There are notable differences when it comes to growth orientation. While 79% of the surveyed social enterprises have a strong growth orientation, this is only true for 36% of sharing economy organizations. When we regress growth orientation on profit orientation and fields of activity, we find that the lack of growth orientation appears to be driven by membership in the field of room sharing, while the fields of mobility, development and housing, and health appear to be associated with a greater growth orientation.


Besides, not all growth challenges are the same (figure 3). Our analysis suggests some that some growth challenges are specific to sharing economy organizations and social enterprises, respectively. Social enterprises are more worried about three aspects: preserving program quality, securing capital, and managing growth internally. Sharing economy organizations, in contrast, care more about fidelity to the mission and managing growth internally. When accounting for profit orientation, we find that those who are profit-oriented worry about securing capital, while those that are not worried about fidelity to the mission as they grow.

Figure 3: Growth Challenges

Our analysis further identifies the variation concerning geographical growth (Figure 4). Sharing economy organizations are not looking to change their geographical scope. At most, some are considering changing from a local orientation to a regional orientation. Social enterprises are more ambitious here, often looking to scale their model to a national scale or even beyond.

Figure 4: Aspirations for Geographical Growth

Embracing Alternative Organizational Forms

Our comparison of sharing economy organizations and social enterprises for the role of community and growth indicates that alternative forms of economic organizing differ in various ways. We take this as a positive sign that also reflects a societal ability to nurture and institutionalize alternative forms of organizing that can potentially overcome well-known deficiencies of capitalism. Future research will tell how these two forms will develop, create impact, and contribute to a more sustainable society.

Acknowledgements

This research was funded by the German Federal Ministry of Education and Research (Grant Number 01UT1408C) and the European Union Seventh Framework Programme (Grant Agreement 613500).

About the authors

Johanna Mair is Professor of Organization, Strategy and Leadership at the Hertie School of Governance, Germany. She is also the Co-director of the Global Innovation for Impact at the Stanford Center on Philanthropy and Civil Society and the Academic Editor of the Stanford Social Innovation Review.

Nikolas Rathert is Assistant Professor for Organization Studies at Tilburg University.

Georg Reischauer is a postdoctoral research associate at Vienna University of Economics and Business (WU) and at Johannes Kepler University Linz (JKU).

References

Etter, M., Fieseler, C., Whelan, G. forthcoming. Sharing Economy, Sharing Responsibility Corporate Social Responsibility in the Digital Age. Journal of Business Ethics, doi: 10.1007/s10551-019-04212-w.
Fitzmaurice, C. J., Ladegaard, I., Attwood-Charles, W., Cansoy, M., Carfagna, L. B., Schor, J. B., & Wengronowitz, R. forthcoming. Domesticating the market: moral exchange and the sharing economy. Socio-Economic Review, doi: 10.1093/ser/mwy003.
Frenken, K., & Schor, J. 2017. Putting the sharing economy into perspective. Environmental Innovation and Societal Transitions, 23: 3-10.
Mair, J., Battilana, J., & Cardenas, J. 2012. Organizing for Society: A Typology of Social Entrepreneuring Models. Journal of Business Ethics, 111(3): 353-373.
Mair, J., & Martí, I. 2006. Social entrepreneurship research: A source of explanation, prediction, and delight. Journal of World Business, 41(1): 36-44.
Mair, J., & Rathert, N. 2019. Alternative organizing with social purpose: Revisiting institutional analysis of market-based activity. Socio-Economic Review, doi: 10.1093/ser/mwz031.
Mair, J., & Reischauer, G. 2017. Capturing the dynamics of the sharing economy: Institutional research on the plural forms and practices of sharing economy organizations. Technological Forecasting and Social Change, 125: 11-20.
Mair, J., Wolf, M., & Seelos, C. 2016. Scaffolding: A process of transforming patterns of inequality in small-scale societies. Academy of Management Journal, 59(6): 2021-2044.
Reischauer, G., & Mair, J. 2018a. How organizations strategically govern online communities: Lessons from the sharing economy. Academy of Management Discoveries, 4(3): 220-247.
Reischauer, G., & Mair, J. 2018b. Platform organizing in the new digital economy: Revisiting online communities and strategic responses. Research in the Sociology of Organizations, 57: 113-135.
Seelos, C., & Mair, J. 2017. Innovation and scaling for impact: How effective social enterprises do it. Stanford, CA: Stanford University Press.
Venkataraman, H., Vermeulen, P., Raaijmakers, A., & Mair, J. 2016. Market meets community: Institutional logics as strategic resources for development work. Organization Studies, 37(5): 709-733.

Photo

Photo by Markus Winkler on Unsplash

When Good CSR Intentions With Communities Go Bad

By Rajiv Maher.

  • Can companies get CSR efforts “right” by engaging in dialogue with communities, thus improve relations and their impacts?
  • Reality shows that companies tend to engage with a few selected community leaders only (who normally receive certain benefits), which creates internal tensions
  • Indeed, consultations processes offer a platform for companies and governments to fragment and divide resistance to their projects

Approximate reading time: 3-4 minutes.

In this post I reflect on the past ten years of working as a practitioner and researcher on the issue of CSR, company – community relations and conflicts. Overall, it is striking to see the gap between the optimism held by practitioners and the pessimism of those affected in communities when it comes to the companies’ socio-economic and environmental impacts. A common response from those working in CSR is that the company’s intentions are good and sincere. Though I have little reason to doubt this point, unfortunately nice intentions from companies, governments, and NGOs carry little currency for communities affected by extractives and natural resources projects.

CSR, Dialogue and Engagement as solutions to territorial conflicts with business
The term CSR has lost much credibility within business and practitioner circles, who these days tend to associate the term more with philanthropy. Instead, practitioners have shifted over to preferring terms like sustainable business, sustainability, community investment, shared value and even human rights and business to label their efforts with nearby communities. Nonetheless all these concepts have in common the aim to bring more good than harm whilst creating genuine win-win scenarios with the communities. A key concept, that cuts across all these terms of implementation is that of dialogue and engagement.

Dozens of well written guidebooks and manuals or toolkits have been published in recent years by multilateral institutions such as the UN and World Bank and governments on community engagement, dialogue and investment by business.  The theory underpinning this is that by engaging in dialogue with communities, companies can then get it right, meaning improve relations and their impacts. It is this assumption that I have tried to interrogate over the past ten years whilst visiting 11 mining and four hydropower affected communities across Brazil, Chile and Peru in addition to multiple conversations with relevant officials from business, government, civil society and activism.

What does CSR and Engagement look like from those who are Engaged?
In short these well intended policies are seen as decisive in nature by those on the receiving end. In every community I have visited the saddening common denominator so far has been the fragmentation of community fabric due to the arrival of these megaprojects armed with their well-meaning CSR strategies. The divisions take place mostly along the lines of those who are willing to accept and engage with the CSR and those who are outrightly opposed to the megaproject on the grounds of the impacts to their culture, spirituality, ecology and livelihoods.

At first communities often start out as collectively opposed to the siting of the project, however, exhaustion and fatigue set in over time as governments and companies stubbornly persist with imposing the project with an increasing number of CSR related carrots. As time passes the dejected phrase I often hear in communities is “we are tired, we just want the conflict to end and make the most of this bad situation. The company has the backing of the state, and we don’t seem to have the power to reject it.” Consequences of these community divisions have included the rupture of relations amongst nuclear family members, neighbours, the eviction of tenants from their rental accommodation and even threats of violence and to personal security.

Next I have found that the group that chooses to give the company a chance and engage with it soon loses its faith and trust in the process as the promised jobs and benefits do not materialize. The companies tend to engage with a few selected community leaders only (who normally receive certain benefits), which creates further internal tensions. I have felt these tensions and mistrust grow with each repeat visit to a community.

The companies are also keen to follow best practice community investment approaches as espoused by leading development practitioners. A key message from this group of professionals seem to be well captured by the mantra “give a man a fish and he eats for a day, but teach him to fish and he eats forever.” This has translated itself in practice into a plethora of training or capacity building courses delivered by companies to communities around entrepreneurship. Typical courses I have encountered include biscuit making, handcraft and beauty/hair salon courses, which community members found of limited worth. Residents stressed they all had immediate needs of having a fish for the day as well as learning how to fish, but that eating for the day mattered most and this is frowned upon by companies and CSR professionals. In short you can imagine the complex internal social and political struggles that now take place between and amongst community residents who are now divided into different groups that have no trust in one another.

What do companies say about this?
The corporate response to the abovementioned critique has normally been to refute the level of internal divisions, stating it was worse before they arrived. Practitioners often claim that the CSR standards themselves are not at fault, but they just need to be better implemented. Poor implementation of CSR would explain the gap in its portrayal. Implicit in these responses is that the projects should always go ahead, but in a more responsible manner, one that satisfies all stakeholders. Perhaps it is time for business and authorities to assess whether their projects should be sited in communities where rejection is outright from the beginning.

So what’s the solution? That’s what counts!
This is the question I am slapped in the face with by practitioners in the CSR field. The implication here is that, if one has no better solution then we should permit the lesser evil to continue. Of course the role of the state is fundamental in these situations and this cannot be done justice in a short blog post. My main nugget of advice to all those working with or studying CSR would be to view its implementation primarily from the perspective of affected actor. Taking a bottom-up approach will undoubtedly add more complexity for CSR professionals. However, it may also lessen the grievances experienced by communities and workers. In the case of indigenous peoples we should look to international legal instruments from the UN such as the Declaration on Indigenous Peoples from 2007. Here the UN state the importance of self-determination of communities and this affords them the right to veto certain projects in their territory. Unfortunately to date companies together with governments have been able to astutely maneuverer themselves around international indigenous peoples rights by imposing consultations on them where they have the perfect platform to fragment and divide resistance to their projects.

The complexities outlined above need to be taken into account by all those who wish to work and research CSR in the community in natural resource related contexts. I would like to emphasize that this post is not a dismissal of all CSR related attempts. However, I would like to raise the flag that in general the sentiment that CSR is used to manufacture consent is strengthening, and practitioners would be wise to consider real as opposed to reformatory changes to CSR. It would appear there are no more new bottles for the wine.

Rajiv Maher is Assistant Professor in Critical Management Studies at Université Paris-Dauphine and is a current research fellow at the Governing Responsible Business Research Environment, CBS. He researches the impacts of CSR related initiatives in communities affected by extractives and natural resources projects. 

Pic by Rajiv Maher, edited by BOS.
The community in Los Choros village, Chile are mostly fishermen, farmers or working with eco-tourism. They are highly opposed to the Dominga mine project. The community from Higuera however is very much in favour of the mine. Yet, earlier this year in August 2017, the government rejected the mine due to the impacts it would have on the marine reserve hotspot of Punta de Choros, where most of the worlds humboldt penguins spend time.