The process of corporate social responsibility public policy-making

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The Process of Corporate Social Responsibility Public Policy-‐Making

Case study: Denmark and Spain

Catalina Hemmink 10173722

M.Sc. in Business Studies -‐ International Management track Supervisor: dr. A.E. Kourula

Second Evaluator: C. Gelhard 26 June 2014

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Abstract

This research analyses the process of Corporate Social Responsibility (CSR) public policy-‐making in Denmark and Spain. These countries are chosen as Denmark is considered a front-‐runner in the field, Spain is currently developing their first national CSR policy, and the two countries offer insights into how different institutional contexts affect CSR public policy-‐making. Primary data in the form of interviews and secondary data in the form of various reports and documents were gathered to analyse which stakeholders are involved, which institutional factors play a role, and how the process of the CSR public policy-‐making takes place. The results illustrated that different types of stakeholders are extensively involved in the process through the establishment of a national CSR council in both countries. However, the representation of different organizations (NGOs, business organizations, trade unions, etc.) varies between the two national CSR councils. Institutional factors such as the pressure from the European Union and the role of corporations in society, play a role in the motives behind the development of CSR public policies.

Key words: Corporate Social Responsibility, Public Policy, Stakeholder Involvement, National CSR Policy, Institutional Factors, Varieties of Capitalism

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Table 1 – List of primary data 23 Table 2 – List of secondary data 24 Table 3 – Coding scheme in NVIVO 26 Table 4 – Country statistics 29 Table 5 – Differences between Action Plan 2008-‐2011 and Action Plan 2012-‐2015 31 Table 6 – Differences between the Danish and Spanish CSR council 41

List of Figures

Figure 1 – Relational model for CSR public policy analysis by Albareda et al. (2007) 15 Figure 2 – Process of public policy-‐making by Driessen et al. (2001) 16 Figure 3 – Process of Danish national CSR policy-‐making: Action Plan 2012-‐2015 34 Figure 4 – Timeline of progress of national CSR policy-‐development in Denmark & Spain 41 Figure 5 – Overview of member representation in CSR councils in Denmark & Spain 42 Figure 6 – Modified framework of process of CSR public policy-‐making 49

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1. Introduction

In the past two decades, Corporate Social Responsibility (CSR) has grown rapidly due to the growing globalisation bringing both its positive and negative aspects to the economic development (Visser & Tolhurst, 2010). The idea of CSR is that it reflects the social consequences of business activities, which defines CSR as clearly articulated and communicated policies and practices of corporations reflecting business responsibility (Matten & Moon, 2008). Van Marrewijk (2003) argues that there is an abundance of definitions, which are often biased toward specific interests. In this research, the definition “The responsibility of enterprises for their impacts on society” (European Commission, 2011) is used to define CSR.

Whereas in the past CSR was often a voluntary deed by companies and thus, business-‐ driven, national governments and other institutions have introduced CSR into public policies. Throughout the 20th_{century,
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developed an extensive welfare state that allowed governments to acknowledge the importance of companies in tackling social problems (Albareda et al., 2007). In the Nordic countries, Midttun et al. (2012) investigated whether the development of these CSR public policies, leaving welfare issues to the discretion of private companies, would lead to conflicts. They concluded that CSR is mostly attractive as an opportunity to enlarge beyond the reach of traditional welfare measures and that the governments welcome voluntary corporate self-‐regulation only as a supplementary approach. The European Commission developed a strategy on corporate social responsibility in 2011 in which member states are stimulated to develop a national CSR policy (European Commission, 2011). CSR has been widely researched in Europe, but also in other parts of the world, notably Asia (Chapple & Moon, 2005; Welford & Frost, 2006), Latin America (Peinado-‐Vara, 2006; Prieto-‐Carrn, 2006) and North America (Welford, 2005; Freeman & Hasnaoui, 2011).

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Although CSR, its effects, its definitions and its triggers have been extensively researched, CSR public policy-‐making differs widely between countries because of institutional settings (Doh & Guay, 2006), and these differences have been researched to a lesser extent. According to Kang & Moon (2012), this is because the field of comparative studies of CSR lacks theoretical development. Research has been conducted on the differences in public policy-‐making in the United States and Europe (Doh & Guay, 2006; Hartman, Rubin, & Dhanda, 2007; Maignan & Ralston, 2002; Matten & Moon, 2008), within the EU (Albareda et al, 2007) and between Western European and Central and Eastern European countries (Steurer, Martinuzzi & Margula, 2011).

In addition to the research conducted by Matten & Moon (2008), Albareda et al. (2007), and Steurer, Martinuzzi & Margula (2008), this research analyses the difference between the process of public policy-‐making in Denmark and Spain because these EU countries have different institutional frameworks. Denmark is considered a Coordinated Market Economy (CME), and Spain a combination of CME and Liberal Market Economy (LME). A qualitative analysis attempts to uncover the institutional forces behind the public policy-‐making of CSR in each country, and to reveal to which extent stakeholders are involved in the process of public policy development.

Through a combination of primary data, consisting of interviews with experts in the field in Denmark and Spain, and secondary data, documents and various reports of both countries, a qualitative exploratory research is done to increase the understanding of the public policy development process in both countries and to answer the following research question:

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2. Literature Review

2.1 Corporate Social Responsibility

Corporate Social Responsibility (CSR) emerged during the 1930s and 1940s, but the publication by H. Bowen, Social Responsibilities of the Businessman (1953), is arguably the initiation of CSR in the modern period of literature on the subject (Carroll, 1999). Since then, many definitions have arisen to describe the phenomenon of CSR. Dahlsrud (2008) observes that none of the definitions of CSR define the social responsibility of business, but rather describe CSR as a phenomenon. The European Commission (2001) defines CSR as follows: ‘The responsibility of enterprises for their impacts on society’, whereas Campbell (2007) makes the distinction of CSR as both objective (fair wages) and subjective (needs of stakeholders). Garriga and Mélé (2004) classify the main CSR theories in four groups: instrumental theories, political theories, integrative theories and ethical theories, whereby each theory describes CSR practices providing a different motive for the companies implementing CSR. “CSR knowledge could best be described as in a continuing state of emergence” (Lockett, Moon & Visser, 2006, p.19), which implies the CSR movement originates in the ‘40s and ‘50s but is still evolving. Steurer (2010) argues that CSR efforts emerged because of increasing stakeholder pressures and demands, not because of legal requirements or voluntary decisions.

Several management disciplines have recognized that CSR fits several purposes in different divisions within the company (van Marrewijk, 2003), meaning that every company conducts CSR with different motives. Hemingway and Maclagan (2004) also address the notion of CSR motives, as they conclude that even though CSR is commonly explained as a strategic interest of the company, individual managers also exercise influence by altering projects to address their personal moral concerns. Besides internal motivation from within a company, companies are more likely to act in socially responsible ways when they encounter strong governmental regulation, collective industrial

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self-‐regulation, NGOs and other independent organizations that monitor them, and a normative institutional environment that encourages socially responsive behaviour (Campbell, 2007).

Porter & Kramer (2006) distinguish ‘Responsive CSR’ from ‘Strategic CSR’. Social responsibility should be perceived as building shared value rather than used as ‘damage control’ or as a PR instrument. According to the authors, companies should identify the particular set of societal problems that is best fit to help resolve, and from which it can gain the greatest competitive benefit (Porter & Kramer, 2006).

In 2012, Aguinis and Glavas (2012) published an article in which they reviewed the CSR literature, offering a multilevel and multidisciplinary theoretical framework that synthesizes and integrates the literature at the institutional, organizational, and individual level of analysis. The authors offered a general theoretical framework that is broad and allows for the inclusion of more variables in the future. This to opening the possibility that knowledge regarding CSR will continue to accumulate in a more systematic fashion (Aguinis & Glavas, 2012). They concluded that the majority of CSR articles published address the institutional and organizational levels of analysis, and the minority on the individual level of analysis (Aguinis & Glavas, 2012).

2.2 Institutional Theory of CSR & Varieties of Capitalism

The motivations of companies to engage in CSR are dependent on institutional factors (Doh & Guay, 2006; Campbell, 2007; Matten & Moon, 2008). Campbell (2007) states that the conditions under which corporations are likely to behave in socially responsible ways is mediated by institutional conditions such as public and private regulation, the presence of non-‐governmental and other independent organizations, institutionalized norms, behaviour among peer corporations, and dialogues with stakeholders. Institutional forces are somewhat dependent on state law and political regulations and legislation. Even though CSR can be an intrinsic motive, institutions can force companies to implement CSR since the emergence of institutions like the ‘Occupational Safety and Health Administration’ in the United States (Portz, 1991 in Campbell, 2007).

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Matten and Moon (2008) argue that in CSR, the motives of shareholders, stakeholders and managers shape the way corporations are governed and that the institutional theory compares these motives within national, cultural and institutional contexts. Based on the new institutionalism by DiMaggio & Powell (1983), defining the institutional isomorphisms (coercive political regulation, normative pressures from professional groups, mimetic processes of imitation), Jackson and Apostolakou (2010), conclude that CSR may become an institutionalized feature of sectoral governance structures. Depending on the sector companies operate in, Non-‐Governmental Organizations (NGOs), consumers and other stakeholders, will behave differently dependent on the sector and its risk perceived by society (Jackson & Apostolakau, 2010). However, these authors also state that “CSR may be associated with the attempt of firms to compensate for institutional voids or substitute for formal institutions, rather than acting as a mirror of institutionalized forms of participation or ‘best practice’ terms of outcomes“ (Jackson & Apostolakau, 2010, p. 18).

In the book ‘Institutions and Organizations’, Scott (1994) distinguishes three pillars: the regulative pillar (institutional constraints and regulative behaviour), the normative pillar (values, norms and roles), and the cognitive pillar (a social construction of reality, taking into account both objective conditions as well as the subjective interpretation). These cognitive, normative and regulative structures and activities provide stability and meaning to social behaviour. An institutional perspective on CSR implies that firms do not make decisions about CSR solely based on instrumental decision-‐making, but that these decisions are framed in a broader context (Jackson & Apostolakou, 2010).

Aguinis and Glavas (2012) conclude that institutional forces affect the extent of and types of CSR actions and policies firms choose to implement, but also may lead to symbolic rather than genuine CSR actions. The relationship between CSR initiatives and outcomes changes, depends on several institutional-‐level variables, as they are stronger when stakeholders have more power and legitimacy, and in the presence of increased regulation (Aguinis & Glavas, 2012 p. 10).

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In 2001, the book ‘Varieties of Capitalism’ edited by Peter A. Hall and David Soskice was published. In this book, several authors analyse two types of capitalist economies: Liberal Market Economies (LME) and Coordinated Market Economies (CME). The Varieties of Capitalism approach is a framework for understanding institutional differences and similarities among developed economies. In the book, it is discussed that institutions are not solely shaped by a legal system, but also by informal rules or common knowledge acquired by actors through history and culture of a nation (Hall & Soskice, 2001).

In LMEs, firms coordinate their activities primarily via hierarchies and competitive market arrangements. Market relationships are hereby, characterised by the arm’s-‐length exchange of goods or services in a context of competition and formal contracting. In response to the price signals, the actors adjust their willingness to supply and demand goods or services (Hall & Soskice, 2001 p.8). In CMEs, firms depend more heavily on non-‐market relationships to coordinate their endeavours with other actors and to construct their core competencies. These non-‐market modes entail more extensive relational contracting, as opposed to competitive relationships to build the competencies of the firm (Hall & Soskice, 2001 p.8). Whereas in LMEs the equilibrium of firm behaviour is given by supply and demand, in CME’s these equilibriums are more often the result of strategic interaction among firms and other actors (Hall & Soskice, 2001 p.8).

Spain is considered part of a ‘Mediterranean’ type, categorised somewhere between the Liberal Market Economies (LME) and Coordinated Market Economies (CME), whereas Denmark is typically classified as a CME in much of the literature, even though it has recently adopted some institutional aspects of the LME (Campbell & Pedersen, 2007).

Vallentin (2013) states that institutional theory is arguably emerging as a dominant perspective on the role of government and politics in CSR. Looking at varieties of capitalism has been useful in clarifying the distinction between liberal and coordinated market economies, how they provide different institutional conditions for companies to engage in CSR (Vallentin, 2013). According to the author, in Coordinated Market Economies, business firms depend more on non-‐

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market relationships (Campbell & Pedersen, 2007 in Vallentin, 2013) to coordinate their interactions with other actors (Hall & Soskice, 2001 in Vallentin, 2013). Hereby, Varieties of Capitalism also points to the notion of institutional competitiveness, which refers to the benefits that firms derive from operating within a particular set of institutions (Campbell & Pedersen, 2007 in Vallentin, 2013). Matten & Moon (2008) discuss that CSR as an explicit element of corporate policies is mainly found in Liberal Market Economies, whereas CSR as an implicit element of the institutional framework of corporations is mainly found in Coordinated Market Economies.

2.3 Differences in CSR policies between countries

In several published articles, the differences between CSR policies between countries have been discussed. For instance, Matten & Moon (2008), distinguish CSR policies between the U.S. and Europe. They conclude that the explicit responsibility of U.S. corporations was socially embedded whereas the European style of state-‐oriented and cross-‐sectoral coordinated matrices of responsibility is more strongly associated with implicit CSR including lifelong employment, benefits, social services and healthcare. Doh & Guay (2006) determine that in the USA, interest groups have no formal or traditional standing in the public policy process and the opportunities for influencing public policies are more diffused, due to the country’s federal structure. In Europe, there has been a steady movement of policy-‐making from national levels to the European regional level (intentionally, since member countries have chosen to integrate themselves to maximise economic growth and international competitiveness) (Doh & Guay, 2006).

In the United Kingdom and Ireland for example, CSR first emerged during the late 20th century. This occurred, as a response to a deficit in social governance when the economy was undergoing a crisis through creating corporate networks and public-‐private partnership projects to strengthen CSR, which involved firms in social projects (Albareda, Lozano & Ysa, 2007). In Nordic countries, social problems were more seen as a part of governments’ core competences, and must, therefore, be resolved in their policies (Rosdahl, 2001 in Albareda, Lozano & Ysa, 2007). CSR in Scandinavian countries is based on a consensual political culture and a welfare state where well-‐

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functioning partnerships exist between business, government and labour organizations (Carsen, Hagen, Sethi, 2013). Gjølberg (2009), states that there are distinct national patterns of CSR and that the nationality of a company matters to its CSR practices and performance. Companies adapt their strategies and competitive advantages to their institutional environments (Gjølberg, 2009 p. 11).

2.4 The role of Governments in Public Policy-‐making

Governments have become increasingly active in promoting and shaping CSR (Steurer, Martinuzzi & Margula, 2012). However, in Europe there has been a steady movement of policy-‐making from national level to the European level, which has resulted in the EU becoming the key focus of policy-‐ making (Doh & Guay, 2006). According to Steurer, Martinuzzi & Margula (2012) it would be consistent for governments in all EU member states to promote CSR with soft public policies, since the European Commission encourages CSR as a policy objective (Steurer, Martinuzzi & Margula, 2012). Aguinis and Glavas (2012) describe this as reactive CSR, where firms feel they must engage in CSR because of stakeholder and coercive pressures.

In 2002, the European Commission released a report on CSR that stated ambitious policy options to increase the transparency of CSR in Europe (Steurer, 2010). This CSR policy changed, however, from a proactive approach to a passive approach which re-‐emphasises business self-‐regulation (European Commission, 2006 in Steurer, 2010). A new report was released in 2011 in which the European Commission encourages all member states of the EU to develop a national CSR policy. The European Commission aims to align European and global approaches to CSR through OECD Guidelines, the 10 Principles of the UN Global Compact, UN Guiding Principles on Business and Human Rights, the ILO tri-‐partite and the ISO 26000 Guidance Standard on Social Responsibility (European Commission, 2011). Besides the encouragement of CSR policy-‐making by the European Commission, national governments have also increased the notion of CSR public policy-‐making. However, they differ in application of public policy-‐making per country (Albareda et al., 2008).

Bredgaard (2004) distinguishes between bottom-‐up and top-‐down CSR initiatives. In the bottom-‐up approach, businesses are the initiators of conducting CSR whereas in the top-‐down

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approach, governments act as initiators. Public policies originate from top-‐down approaches. This author distinguishes four types of policy programmes: Regulative, Motivation, Persuasion and Public activity programmes (Bredgaard, 2004). Each type of policy entails different types of power and control to regulate behaviour of target groups (Bredgaard, 2004). Persuasion and Regulative programmes are most often used in informing, convincing, and putting pressure on companies to pursue CSR activities (Bredgaard, 2004).

The following tools of governance are used as methods that governments use to motivate companies to implement CSR: Legal instruments (‘sticks’), Financial instruments (‘carrots’), Informational instruments (‘sermons’), Partnering instruments (‘ties’) and Hybrid instruments (‘adhesives’) (Steurer, Martinuzzi & Margula, 2012). Two of these tools are considered ‘soft laws’ since legal instruments might have a mandating character but they are not universally binding and financial instruments are more applicable for tax breaks and subsidiaries, when related to CSR (Steurer, 2010). Steurer (2010) summarises that governments engage in CSR with ‘sermons’, ‘sticks’, ‘carrots’, ‘ties’ that hold actors together, and ‘adhesives’ that hold instruments together.

In recent years, CSR has matured from a philanthropic idea to a more comprehensive concept of strategic triple bottom line (people, planet & profit) management and CSR practices are now more popular among businesses and governments from countries with reasonably social and environmental regulations than among the neo-‐liberal ones (Steurer, 2010). Although CSR activities are, by definition, voluntary and policies are soft in character, this does not mean that governments cannot implement minimum standards and quality-‐assuring procedures (Steurer, 2010).

Fox et al., (2002) identify four different principal public sector roles: mandating role, facilitating role, partnering role and endorsing role. In the mandating role, governments set minimum standards for business performance rooted within the legal framework. An example could be a national government obliging companies to produce yearly CSR reports (Ioannou & Serafeim, 2011). The facilitating role causes public sector agencies to enable companies to engage with the CSR agenda whereby the public sector plays a catalytic or supporting role. For example, by providing

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funding for research. In the partnering role, the private sector, public sector and civil society form a partnership to tackle complex problems. Political support and public sector endorsement reflect the endorsing role. This involves direct recognition through e.g. award schemes.

Matten & Moon (2008) note that implicit CSR is conceived as a reaction to a corporation’s institutional environment in the form of norms, rules and laws, whereas explicit CSR is the result of a deliberate, voluntary and often strategic decision of a corporation (Porter & Kramer, 2006 in Matten & Moon, 2008).

2.5 Process of Public Policy-‐making

The process of public policy-‐making is dynamic, ongoing and constantly subject to evaluation, termination, expedition or erratic movement (Gerston, 1997). It is what those in position of authority do on behalf of society. Gerston (1997, p.7) defines public policy as ‘the combination of basic decisions, commitments, and actions made by those who hold or influence government positions of authority’. Gerston (1997) distinguishes public policies created horizontally (with multiple agencies coordinating efforts at different levels) and vertically (the decisions are being made at one level, usually national). In a globalized world, public policies are not simply driven by governments defined through a dialogue between public and private sectors (Mendoza, 1996 in Albareda et al., 2007). Albareda et al. (2007) conclude that in 15 EU governments, the most significant number of policies lie in the relational framework between government and business (number 2 in Figure 1). In Figure 1, an overview of this bilateral collaboration is depicted, created by Albareda et al. (2007). The authors conclude that in Denmark and other Scandinavian countries, a partnership

Figure 1: Relational model for CSR public policy analysis By: Albareda et al. (2007)

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model exists where partnerships operate as a shared strategy between sectors. Governments acknowledge the importance of companies and other economic actors in addressing and resolving social problems. The movement towards CSR hereby, mainly involves a change in attitude by social actors assuming co-‐responsibility in the building of a more inclusive society. According to the authors, Spain (and other Mediterranean countries), create discussion groups for the different social actors to achieve public consensus on CSR on the basis of the so-‐called ‘Agora’ model, where different stakeholders are involved in the process of public policy-‐making. The countries in this model were the latest to introduce CSR policies. In these Mediterranean countries, the European Commission plays a role in promoting a European framework for CSR (Albareda, Lozano, & Ysa, 2007).

Anderson (2010) has created a conceptual framework of public policy-‐making: 1) Problem identification and agenda setting, 2) Formulation, 3) Adoption, 4) Implementation, and 5) Evaluation. However, this is a general model of public policy-‐making. Driessen et al. (2001), propose a management model for interactive policy-‐making: a process whereby multiple parties play an active role and not solely the government (Figure 2).

Figure 2: Process of public policy-‐making as described by Driessen et al. (2001)

2.6 Theoretical framework

Extensive research has been conducted to analyse the process of CSR public policy-‐making in different countries (Albareda et al., 2007; Matten & Moon, 2008; Steurer, Martinuzzi, & Margula, 2012). However, little research has been conducted to look in-‐depth into the CSR policy-‐making differences between two EU countries with different forms of Variety of Capitalism, such as Denmark (CME) and Spain (LME-‐CME).

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Research on the topic of public policy-‐making by Albareda et al. (2007), was focused on the development of an analytical framework to understand the approaches and perspective of governments in designing and implementing public policies to promote CSR. The current research will be more focused on the institutional factors affecting the process and the role of stakeholders in the process of public policy-‐making. Matten & Moon’s article (2008), distinguishes explicit and implicit CSR between the United States and Europe, hereby focusing on comparative and dynamic CSR. Driessen et al. (2001) developed a conceptual framework on interactive public policy-‐making, where several actors have influence on the development of the public policies.

In the Discussion chapter (page 46), it can be concluded whether Figures 1 and 2 are a reflection of the process of national CSR policy development in Denmark and Spain or whether it should be adapted in accordance to the respective countries. Moreover, it will be clearer which stakeholders are involved in the policy-‐making process.

Analysing national CSR public policies drafted by the Danish government and by the Spanish government could show the affect of institutional factors, and differences in the process of CSR public policy-‐making. This gap in the literature leads to the following research question: How do governments develop CSR Public Policies?

By analysing the involvement of stakeholders in making public policies, conclusions can be drawn on whether companies, NGOs and other stakeholders indeed have a say in the process of policy drafting, as several authors conclude (Albareda et al., 2007; Driessen et al., 2001), and whether this differs between Denmark and Spain, leads to sub question 1: How are stakeholders involved in the process of CSR public policy-‐making?

Albareda et al. (2007) analysed the process of public policy-‐making and looked at which stakeholders were involved in every country. Driessen et al. (2001) propose a model of public policy involvement where stakeholders are involved. In order to uncover how this process takes place in Denmark and Spain, the following sub question will be answered: How does the process of CSR public policy-‐making take place?

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Matten & Moon (2008) argue that the ‘new institutionalism’ by DiMaggio & Powell (1983) provides a helpful theoretical perspective for understanding the processes of adoption of CSR practices. Doh & Guay (2006) argue that different institutional settings affect the different public policies between countries. To determine which institutional factors play a role in the development of CSR public policies in Denmark in Spain, and whether the Varieties of Capitalism affect the policies, lead to sub question 3: How do institutional factors affect the process of CSR public policy drafting?

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3. Methodology

3.1 Research Design

This research is a qualitative multiple case study, where the process of CSR public policy-‐making in Denmark and Spain is analysed through in-‐depth interviews, analysing government CSR public policies, various CSR reports, and other documents, thus, a combination of qualitative and documentary data. According to Eisenhardt & Graebner (2007), multiple cases are discrete experiments that serve as replications, contrasts, and extensions to the emerging theory (Yin, 1994 in Eisenhardt & Graebner, 2007). By analysing the collected data, conclusions can be drawn on whether the existing theory on public policy-‐making can be expanded or modified. The interaction between a phenomenon and its context is best understood through in-‐depth case studies (Dubois & Gadde, 2002 p.554).

In this research, the abduction approach is applied. Abduction requires an integrated approach, because the main difficulty of case studies is handling the interrelatedness of the various elements in the research work (Dubois & Gadde, 2002 p. 555). In studies relying on abduction, the original framework is successively modified, partly as a result of unanticipated empirical findings, but also of theoretical insights gained during the process (Dubois & Gadde, 2002 p. 559). In the Literature Review chapter, two models are presented (original framework), which are analysed in the Discussion chapter through the empirical findings (unanticipated empirical findings) and subsequently modified to a modified framework of CSR public policy development.

Triangulation is used to increase the reliability of the data (Saunders, Lewis & Thornhill, 2007). By using multiple sources of data, this will lead to more reliable data, which increases the validity of the research (Gibbert & Ruigrok, 2010). These multiple sources of data consist of interviews with several actors (CSR ministry representatives, CSR associations, NGOs & companies)

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as primary data, and CSR advisory reports, CSR public policies, EU websites, etc. as secondary data. Yin (1994) states that multiple sources permit the researcher to address a wider range of historical, attitudinal, and behavioural issues, and that findings in a case study are more convincing and accurate if based on several different sources of information (Dubios & Gadde, 2002 p.556).

Albareda et al. (2008) analysed different government CSR visions, objectives, strategy and priorities, structures and policy implementation across different levels of government to analyse the different public policy-‐making initiatives in Italy, Norway and the United Kingdom and subsequently created a CSR policy framework. Steurer, Martinuzzi & Margula (2012) conducted phone interviews with public administrators to obtain insights into the policy-‐making process. Both these methods used were useful in completing their research objectives and drawing conclusions regarding the process of public policy-‐making. Therefore, parts of these methods are used to gather data in this research. This data will be analysed through the method mentioned in paragraph 3.4 with an explanatory aim to further understand the process of CSR public policy-‐making in two different countries.

3.2 Sampling

The process of public policy-‐making has not extensively been researched and hence, understood. To enhance the understanding of this process, the countries Denmark and Spain are analysed in a parallel approach since this is expected to give a theoretical contrast in the process of public policy-‐ making. These two countries offer insights into how institutional contexts, affect policies on CSR, and therefore, can contribute to a deeper understanding of public policy-‐making. A practical reason for choosing Spain is the fact that data can be accessed and interviews can be conducted in Spanish when a translation is unavailable, whereas Denmark is chosen because data is accessible in English and Denmark has developed two CSR reports since 2008, which thus, can be compared. The theoretical reason for choosing these countries is that Spain might have a different process of policy-‐ making than Denmark because of different Varieties of Capitalism. Spain is considered between the Liberal Market Economy (LME) and Coordinated Market Economy (CME), whereas Denmark is

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classified as CME (Campbell & Pedersen, 2007). The relational model for CSR public policy analysis by Albareda et al. (2007) was developed and published seven years ago and might be out-‐dated since an advisory council for CSR was established in Spain in 2008 and in Denmark in 2009. Denmark is considered a frontrunner in the field of CSR in Scandinavia (Vallentin, 2013) whereas Spain is currently developing its first national CSR policy. Therefore, it is expected that the stage of development of CSR policies in both countries will differ.

3.3 Data Gathering

Data is gathered through qualitative interviews with public administrators, members of CSR councils, CSR associations, and NGO’s. Secondary data consists of websites, CSR reports, public policies, Royal decrees, various reports, etc. (Appendix C). Interviews are crucial since an important value of qualitative research is description and understanding of the actual human interactions, meanings and processes that constitute real-‐life organizational settings (Gephart, 2004).

Semi-‐structured in-‐depth interviews have been conducted with different stakeholders involved in CSR in each country to get an insight into the process of national public policy-‐making. As both countries have a CSR council existent advising the government on the content of the national CSR policy, members of these councils have been interviewed to gain insight into the process of the policy-‐making. NGOs as well as CSR associations have been approached to discover as to whether and to which extent they take part in the process of public policy-‐making. This primary data gives an insight in the involvement of different stakeholders in the public policy-‐making process. Below, a list is presented of those interviewed.

3.3.1 Primary data

Interviews in Denmark were conducted with:

-‐ A Head of Section at the Danish Business Authority (Under the Danish Ministry of Business & Growth). This public administrator is responsible for monitoring the implementation of the Government’s inter-‐ministerial Action Plan for Corporate Social Responsibility 2012-‐2015

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and handles a number of projects promoting strategic social responsibility among Danish companies. She was one of the writers of the Action Plan 2012-‐2015

-‐ A Union Advisor at The Danish Confederation of Trade Unions. This confederation comprises of 17 trade unions, develops strategies and reports on responsible globalisation policies, global labour market efforts & CSR guidelines. This confederation is a member of the Danish Council for Corporate Social Responsibility.

-‐ A member of the Danish Council for Corporate Social Responsibility set up in 2009 as part of the Danish Action Plan for Social Responsibility. This council provides recommendations to the government, the corporate sector and associations. This member is the Head of the Sustainability Group at A.P Møller -‐ Mærsk.

Interviews in Spain were conducted with:

-‐ An Associate Professor at ESADE (Escuela Superior de Administración y Dirección de Empresas) – Ramon Llull University in Barcelona. Specialized in Business Ethics, Corporate Social Responsibility and stakeholder involvement.

-‐ The Director of Observatorio Responsabilidad Social Empresarial (Observatory for CSR), working with the General Union of Workers in Spain. Analysing the development of political and practical strategies of CSR activities of companies in Spain. This organization is a member of the Spanish State Council on Corporate Social Responsibility (CERSE).

-‐ The Director of Communication and Institutional Relationships at Forética, non-‐profit businesses network on sustainability and CSR with the aim of fostering CSR within large businesses in Spain. Forética is a member of CERSE

-‐ A Project leader at Club de Excelencia en Sostenibilidad (Club of Excelence in Sustainability) a business association consisting of large companies aiming at sustainable growth. This association is a member of CERSE.

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Table 1

List of primary data: interviews

Country Title Organization Language Length

Spain Associate professor ESADE Business School, Barcelona

English 19 minutes Spain Director of

Communications and Institutional Relations

Forética English 35 minutes

Spain Director Observatório RSE Spanish written

Spain Project leader Club de Excelencia en

Sostenibilidad Spanish written

Denmark Head of Section Danish Business Authority English 23 minutes Denmark Head of Sustainability &

member of Danish Council for Corporate Social Responsibility

AP Møller -‐ Mærsk English 12 minutes

Denmark Union Advisor Danish Confederation of

Trade Unions English 35 minutes

Five interviews were telephone interviews, since the interviewees reside outside of the Netherlands. The remaining two interviews were submitted through e-‐mail, as these interviewees were unable to participate in a telephone interview due to time constraints (Table 1). All telephone interviews were recorded, with permission of the interviewee, with the purpose of transcribing the interview. This transcription was subsequently analysed through NVIVO version 10.

The interview questions were based on the research questions, which were inspired by the research gap in the literature review. The questions asked during the interview are depicted in Appendix A. All participants gave permission to use their title and the name of the organization they work for, and gave permission to use their quotes in this research. The interview was semi-‐ structures, as several additional in-‐depth questions were added throughout the interview.

3.3.2 Secondary data

The data listed in Table 2 was used for textual analysis. This data was subsequently coded and analysed using NVIVO version 10 as described in section 3.4. Sources and dates of access can be found in Appendix C.

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This secondary data was gathered on the Internet, as this information is publicly available. CSR public policies were found on the governmental websites of the respective countries and on the website of the European Commission. Spain’s Ministry of Labour and Social Affairs is currently Table 2

List of secondary data

Type of Data Denmark Spain

National CSR

Public Policies Action Plan for Corporate Social Responsibility 2012-‐2015 (2012)

Action Plan for Corporate Social Responsibility 2008-‐2011 (2008)

Borrador Plan Nacional RSE (Draft of National Plan CSR) (2014)

Spanish Sustainability Development Strategy (2007)

CSR Legislation The Financial Statement Act

(2008) Sustainable Economy Law (2011)

Green Accounts The Green Accounts Act (2002) Requires certain listed companies to draw up green accounts

Regulation PRE/116 (2008)

Green Public Bid Plan for the General Administration of the government Social

Dialogue/Council recommendations

Recommendations from Danish Council (2010)

Mandate for Council (2012)

Corporate Social Responsibility: Social Dialogue (2008)

Guidelines for

Companies Guidelines for sustainable supply management SGE 21 (2008) System of Ethics and Socially Responsible Management Peer review

reports initiated by the European Commission

Peer Review Report Denmark Peer Review Report Spain

Governmental CSR

websites Website Danish Government on CSR Website Spanish Government on CSR Websites on CSR

reporting Corporate Sustainability Reporting (Denmark) www.resportingcsr.org

Corporate Sustainability Reporting (Spain) www.reportingcsr.org

Other documents Report for the EU on Corporate Social

Responsibility in Spain (2013)

Forética Report. The evolution of Social

Responsibility among Spanish Businesses (2011)

Corporate Social Responsibility National Public Policies in the European Union An Analysis of Policy References made by large EU Companies to

Internationally Recognised CSR Guidelines and Principles (2013) An Analysis of the national and EU policies supporting Corporate Social

Responsibility and Impact

Communication from the commission to the European Parliament, the Council, the European economic and social committee and the committee of the regions (2011)

The process of corporate social responsibility public policy-making