Which activist organisations are steering the corporate responsibility cause in Spain, and in what direction?
Like many countries, Spain has historically tended to have two types of non-governmental organisations: the activist and the humanitarian.
Daniel Arenas, associate professor at Esade Business School and head of research of the Institute for Social Innovation, says traditionally the former “have perceived capitalism as a problem, which has made dialogue more difficult”.
The second type of NGO is focused on “collaboration” and enjoys a “more stable relationship” with companies. Such organisations work in partnership with businesses, where the NGO provides people and infrastructure to pursue a humanitarian cause while the company helps with financial support. There are also, of course, NGOs that mix both approaches.
Using vocal activism has been a successful strategy used by some NGOs, raising public awareness and creating a platform for dialogue. A good example was Red Electrica’s Morocco project in 1997.
Red Electrica de España (REE) manages the Spanish electricity system. The company faced strong opposition from environmental and social NGOs when it began planning the installation of its 26km submarine cable that would connect Spain to Morocco through Gibraltar. The opposition by NGOs, which included street protests, caused a four-year delay in the project, and had a significant cost, but served as a lesson in stakeholder dialogue.
In 2000, when a larger project was approved to increase the energy exchange between Spain and Morocco under the Western Mediterranean Electric Reinforcement project (REMO II), REE put in practice its stakeholder dialogue lessons. REE created an internal standard to manage new projects with the participation of key environmental and social stakeholders.
“Red Electrica had to learn a better way to do it so they developed a systematic approach to listen to their stakeholders,” Arenas says. The new REE stakeholder programme included assessments, upfront dialogue with stakeholders, monitoring, evaluation and a continuous flow of communication with stakeholders through the Migres Foundation. The new process not only helped the company mitigate corporate responsibility risks for new and ongoing projects, but also created an opportunity to build positive value (and reputation) in the communities where REE operated.
Other examples of successful campaigning by NGOs include the Intermon Oxfam campaign against Repsol (see case study in previous section) and the Campaña Ropa Limpia (Clean Clothes Campaign).
In 2007, those leading Spain’s Clean Clothes Campaign convinced fashion retail giant Inditex, at a shareholders’ meeting, to approve a new code of conduct that guaranteed a fair salary for its workers.
Campaña Ropa Limpia is an international campaign, coordinated by Setem in Spain, intended to raise public awareness on the poor supply chain labour conditions, including excessive working hours and low wages, found in the factories of Spanish fashion and sporting goods companies.
While the campaign is international, the coalition of NGOs in Spain has worked to make it local and relevant to the Spanish consumer. The latest campaign includes a documentary and a publication aimed at end consumers. The publication includes an analysis of the working conditions in the factories of 12 of Spain’s biggest fashion companies.
This case is another sign that the rules are changing in Spain and civil society is becoming more vocal.
Engagement opportunities
However, in Spain “the level of NGO engagement with companies is still low”, says Susana Ruiz, policy adviser for innovative financing and the private sector at Intermon Oxfam Spain. Stakeholder engagement is still “a work in progress” in Spain. “There is not enough history in this area, we need to generate the channels, trust and the right attitude,” Ruiz says. And she adds: “At Intermon Oxfam we would like to see more companies that understand the active role they could play in development.”
Another problem, says Daniel Arenas, is that the relationships of NGOs and companies have often been “ad hoc” and not developed into long-term partnerships.
Despite the high level of campaigning activity by many NGOs taking place in Spain in the past few years, and some recent stakeholder engagement success stories such as REE’s, there remains much to be done.
Companies can benefit from further training in stakeholder engagement, learning to identify the right stakeholders, building a collaborative and productive relationship based on trust, seeking solutions together, and recognising that each partner has its own strengths and expertise to contribute.
A few companies, including Iberdrola, have begun to develop systematic stakeholder engagement programmes with the help of the AA1000 standard, which may change the way Spanish companies engage with stakeholders in the future.
Legally bound
The State Council of Corporate Social Responsibility was created in 2008 by the Spanish government to support the development of responsibility policies with input from stakeholders across sectors.
The council is part of the ministry of labour and includes representatives from various areas such as business associations, civic society institutions and government representatives. Since the council was created, the biggest challenge has been the large number of members (54), the difficulty of reaching agreements given their very different point of views, and the lack of leadership and clear objectives perceived by some members.
On March this year, the new sustainable economy law came into effect, marking a turning point. The Spanish government plans to redesign the economic model of productivity, providing tools to create an economy that supports “innovation, technology, training and clean energies”. Under the new law, companies of more than 1,000 employees will need to report annually on corporate responsibility issues.
Another multistakeholder initiative is the Spain Social Investment Forum (Spain SIF), which is a not-for-profit collaboration of 32 groups interested in promoting responsible investment. The initiative creates a dialogue and knowledge platform for organisations including NGOs, business schools, unions, financial institutions and other organisations.
Spain SIF, now two years old, has enjoyed success and has been of particular interest to those supporting responsible pension plans. Detractors remain, saying it should be more agile and slightly less driven by its private sector members.
Associations advance
Business and civic society associations continue to play a critical role in the advancement of CR in Spain. Foretica, the non-profit organisation made up of a global network of business organisations and professional firms, shares best practices, provides training and has certified 68 companies in Spain on the SGE 21 Standard (Sistema de Gestión Etica y Socialmente Responsable). The Sustainability Excellence Club is another organisation that provides CR expertise and aims to provide a platform for stakeholder dialogue.
From a reputation point of view, the Forum of Corporate Reputation is a business association helping 15 leading Spanish companies with their CR programmes. The Forum, a centre for CR expertise, is currently being restructured as Corporate Excellence – Centre for Reputation Leadership. In its new form, the forum will join the Institute for Analysis of Intangible Assets to provide companies with wider services, including reputation but also covering advice on branding and communications, among other things.
The Spanish CSR Observatory represents a large number of civil associations in the State Council of CSR. The Observatory, speaking for organisations spanning NGOs, unions and consumer associations, aims to “promote the participation and cooperation on CSR issues among social organisations with different points of views”.
In its latest annual report on the quality of corporate responsibility reporting by the IBEX 35 companies, the Observatory highlighted issues of concern to civil society, among them that there is still not sufficient transparency in corporate reporting. To remedy this, the State Council for CSR recently presented a report listing a series of recommendations to increase transparency in reporting.
The CSR Observatory explains in its report the importance of having a regulatory framework to enforce further transparency. According to Orencio Vazquez, coordinator of the Observatory, “since this is a voluntary field without control, there is a difference between what is said and what is done”.