Building a Europe of excellence: Turning knowledge into growth

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Workshop 7 Business and European society ethics
or profits?
Jacques Beauchet Carrefour Group
Hannah Ellis Corporate Responsibility Coalition
Philip Monaghan Account Ability
Maive Rute European Commission
Monika Wulf- Mathies Deutsche Post World Net
Nigel Roome Solvay Business School ULB
Donald Kalff Immpact
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Workshop 7 Business and European society ethics
or profits?
Moderator
Philip Monaghan Director of Operations AccountAbil
ity
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Workshop 7 Business and European society ethics
or profits?
Jacques Beauchet Member Management Board Managing
Director Carrefour Group
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Workshop 7 Business and European society ethics
or profits?

Business and European society ethics or
profits?Carrefours response
How can a leading European company promote a
sustainable model?
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Carrefour A profitable business model
Workshop 7 Business and European society ethics
or profits?

• 1st European retailer, 2nd worldwide
• 87.4 billions turnover in 2006
• More than 450,000 employees
• 29 countries
• 12 000 stores
• More than 3 billions cash transactions per year
• Activities in Europe, Asia and Latin America

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Based on a long term vision global
responsibilities (1)
Workshop 7 Business and European society ethics
or profits?

• Product quality safety policy
• Own-brand products with minimum quality criteria
• The development since 1992 of the Carrefour
  Quality Lines
• Buying policy
• Inclusion of social and environmental concerns
• In 1997, an association, INFANS was created
  together with the FIDH
• Commitment to the Global Compact of the United
  Nations in 2001
• Sustainable relationships with our suppliers,
  with 90 of local sourcing

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Workshop 7 Business and European society ethics
or profits?
Based on a long term vision global
responsibilities (2)

• Social labour rights
• Protection of employees rights
• A common set of values Carrefour Attitude
• Environmental societal impacts
• Local communities investment
• A privileged link with the consumer
• More than 2 billions of reusable bags sold in
  France in 2006

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A strong will to deploy our model
Workshop 7 Business and European society ethics
or profits?

• Employees management involvement all the
  brands of the Group, from employees to
  management, in all our business units
• Stakeholders support and advice
• We signed in 2002 an international agreement
  with UNI-Europa
• Scale effect development of synergies with
  other players

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Workshop 7 Business and European society ethics
or profits?
in order to go further

• We assume our share of responsibilities within
  our scope of competence
• Companies cannot and should not preclude the role
  of the state and public authorities
• The development of minimum standards might prove
  necessary
• The promotion of sustainable consumption
  patterns should foster everyone's commitment
  towards a more balanced economic development

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Workshop 7 Business and European society ethics
or profits?

• Hannah Ellis

Coordinator, The Corporate Responsibility
(CORE) Coalition / The European Coalition for
Corporate Justice (ECCJ)
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Workshop 7 Business and European society ethics
or profits?

Business and European society ethics or profits?
Regulation No longer an evil word
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Why Regulation is Needed
Workshop 7 Business and European society ethics
or profits?

• Lack of success of voluntary initiatives
• Limits to ethical consumption
• Short-termism

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The UK Case The Companies Act (2006)
Workshop 7 Business and European society ethics
or profits?

• Directors Duties
• Mandatory Reporting
• Rights of Redress

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The EU Case Corporate Social Responsibility A
New Partnership
Workshop 7 Business and European society ethics
or profits?

• Mandatory reporting of impacts
• Directors duties
• Rights of redress
• Resolution on Tuesday

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Summary
Workshop 7 Business and European society ethics
or profits?

• Aim as pole of excellence
• Failure of voluntary initiatives
• Level playing field is needed

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Workshop 7 Business and European society ethics
or profits?

• Donald Kalff

Former member KLM Executive Board biotech
entrepreneur, writer and advisor
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Capitalism deserves better
moving beyond CSR
Workshop 7 Business and European society ethics
or profits?

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Facing reality
Workshop 7 Business and European society ethics
or profits?

• Over the past 20 years, serious and
  courageous attempts to define, to measure and to
  stimulate CRS, have had limited impact on
  corporate decision making

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Significant pressures point in the wrong
direction
Workshop 7 Business and European society ethics
or profits?

• Profit per share as the sole corporate objective
  is on the march
• Increasingly, the plc is the preferred corporate
  legal entity
• Rule based management is driving out principle
  based management

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Workshop 7 Business and European society ethics
or profits?

• New directions
• Stimulate companies to pursue economic value
• Focus on corporate discontinuities
• Exploit Europes richness of enterprise models

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Workshop 7 Business and European society ethics
or profits?

• www.donaldkalff.eu

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Workshop 7 Business and European society ethics
or profits?
Nigel Roome Daniel Janssen Chair Corporate
Social Responsibility Solvay Business
School Free University of Brussels nroome_at_ulb.ac.b
e
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Workshop 7 Business and European society ethics
or profits?

Corporate ResponsibilityChallenging the
Business Orthodoxy of Ethics versus Profits
Innovating where Business and Society Meet
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Corporate responsibility a policy outlook
Workshop 7 Business and European society ethics
or profits?

• EC Policy envisions Europe as a pole of
  excellence in CR contributing (among other
  things) to
• competitiveness
• employment and human resource development
• protecting the European environment and social
  values
• the shared governance of concerns such as social
  cohesion

EC Communication 136 (36), March 22, 2006
EC communication sets out the intent but not the
process by which corporate responsibility is to
be understood and practised in European companies
it does not touch on the link between ethics
and profits
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Corporate responsibility in contemporary Europe
Workshop 7 Business and European society ethics
or profits?

• Corporate responsibility should be understood as
  part of the shifting relationship between
  business and society found in the different
  institutional and contextual settings that define
  business and society in Europe and around the
  Globe
• CR is therefore part of the social contract
  between business, government and civil society
• However, the Social contract in constant flux
  - past European experience of CR, the US approach
  to CR, are NOT good models for current and future
  European practice in CR

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Where does corporate responsibility fit?
Workshop 7 Business and European society ethics
or profits?
The Company Board, Management, Employees
Governance systems, structures arrangements
that make key-choices about the company in three
domains
Purpose - Mission Creation of wealth and choices
about its distribution between interests Companys
contribution to wealth-creation and
profitability
Existence - Vision Relationships with
shareholders, stakeholders and natural
resources Based on Values, Transparency and Trust
- leading to License to Operate
Activities Human ingenuity (know-how
technology) combined with materials to add
value Efficiency, Effectiveness, Change and
Innovation
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Corporate responsibility - protecting and
creating value
Workshop 7 Business and European society ethics
or profits?

CR is an approach to the relationships that frame
the existence of a company and on which its
purpose depends This leads to a strategic
review of company activities and choices about
..
Protecting the Value of some of the Companys
Existing Assets
Creating New Value for the Company in Society
Control through Codes of Conduct, Risk
Management, KPIs and Performance Systems,
Reporting, Stakeholder Engagement
Innovation driven by problem-finding and
solution-providing in concert with others in
economy and society
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Experiences of leading European companies
suggest that embedding CR in the company means
Workshop 7 Business and European society ethics
or profits?

• Recognising the need for change seeing
  relationships that matter
• Taking a strategic orientation toward CR and
  business
• Developing a compelling vision of their business
• Distinguishing between value protection and value
  creation
• Seeing innovation as key to business and CR
  performance
• Engaging with outside voices early in the process
  of change
• Engaging the whole company in highly
  participative ways
• Trawling widely for new concepts and ideas that
  support vision
• Differentiating CR and business practice to fit
  the many settings in which the company operates
• Openness to developing organisational
  competencies to learn, innovate and participate
  in organisational and social change

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Workshop 7 Business and European society ethics
or profits?
Maive Rute Director Promotion of
SMEs Competitiveness DG Enterprise and
Industry European Commission
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Workshop 7 Business and European society ethics
or profits?

The Lisbon strategy for a Europe of ethics and
profits
Promoting responsible and social entrepreneurship
as viable alternative business models
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European Commission policy on CSR
Workshop 7 Business and European society ethics
or profits?

• CSR for growth and jobs
• Multistakeholder dialogue
• European Alliance on CSR
• CSR is voluntary

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CSR and SMEs
Workshop 7 Business and European society ethics
or profits?

• SMEs do CSR too
• but mind your language!
• Mainstreaming CSR among SMEs report of European
  Expert Group, funding of projects to encourage
  CSR

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European Enterprise Awards
Workshop 7 Business and European society ethics
or profits?

2006 Responsible Entrepreneurship Award
Autopromozione Sociale City of Rome
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Europes social economy combining profitability
and social objectives
Workshop 7 Business and European society ethics
or profits?

• Social economy enterprises private companies
  with collective economic, social, environmental
  goals.
• A different business logic
• Varied forms across Europe, wide range of
  products/services
• Common types/sectors
• Co-operatives (banking, crafts, agriculture)
• Mutual societies (insurance, mortgage)
• Non-profit associations foundations (health and
  welfare, sports, culture, environment, education,
  research)

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Social economy enterprises how important are
they in Europe?
Workshop 7 Business and European society ethics
or profits?

• 4 of employment in France, Germany and UK
• 10 million jobs across Europe
• 8 of businesses
• Working to improve legal and operational
  environment
• Need to improve the image and promote this model
  of entrepreneurship in the service of society.

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Workshop 7 Business and European society ethics
or profits?
Dr. Monika Wulf-Mathies Executive Vice
President Corporate Public Policy
and Sustainability Deutsche Post World Net
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Workshop 7 Business and European society ethics
or profits?

Business and European society ethics or profits?
The view of Deutsche Post World Net
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Workshop 7 Business and European society ethics
or profits?
Our view of the world has changed since 1490
Henricus Martelluss World Map, 1490
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Ethics in 2007 shaped by
Workshop 7 Business and European society ethics
or profits?

• Legislation
• International standards
• Companies own Codes of Conduct
• Investors expectations
• Employees
• Workers councils
• Media
• Society

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Workshop 7 Business and European society ethics
or profits?

Ethics and profits!
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Accepting our social responsibilities
Workshop 7 Business and European society ethics
or profits?

• Minimizing our environmental impact

• Global partnerships

• Local community investment initiatives

• Tackling the causes of climate change

• Offering sustainable products and services

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Workshop 7 Business and European society ethics
or profits?
Jacques Beauchet Carrefour Group
Hannah Ellis Corporate Responsibility Coalition
Philip Monaghan Account Ability
Maive Rute European Commission
Monika Wulf- Mathies Deutsche Post World Net
Nigel Roome Solvay Business School ULB
Donald Kalff Immpact