The Swiss approach to corporate social responsibility reflects national traditions of neutrality and discretion
All nations like to believe they are distinct, but the Swiss are more distinct than most. They certainly stand out in terms of wealth, having the highest per capita income in Europe after Luxembourg and oil-rich Norway.
There is even a term for Switzerland’s concept of its own distinctiveness: Sonderfall Schweiz, or “special case”. This embraces the idea that Switzerland is a place apart: a land of lofty mountains and clean air and water, which keeps itself separate from the conflicts of its neighbours, and as a consequence is stable and unchanging.
Antoine Mach, co-founder of Swiss corporate responsibility researchers Covalence, says the idea of Switzerland’s specialness underpins its business culture, and influences the Swiss approach to corporate responsibility. The defining characteristics are stability, neutrality and modesty.
Often, these qualities have a positive influence on Swiss companies’ strategies, but not always. Stability, for example, means a well-regulated business environment with high environmental and workplace-safety standards. It gives firms predictability. Swiss companies tend to go through fewer and less dramatic cycles of job cuts and downsizing that their American or British counterparts, Mach says. “This can be linked to a tradition of stability.”
However, stability can also mean conservatism and resistance to new ideas. “For a long time we have done it this way, so why should we do it another way? That is something you hear quite often here,” Mach says.
Swiss neutrality also has pros and cons for corporate thinking. From a corporate responsibility point of view, it means there is an emphasis on human rights and conflict resolution. The world’s best-known humanitarian agency, the Red Cross, is a Swiss invention. Its international committee features a former secretary to the board of Swiss food multinational Nestlé and the current chairman of Swiss concrete giant Holcim. A number of leading Swiss companies donate substantial sums to the Red Cross through a corporate support group set up in 2005.
But neutrality can also mean passiveness and “business as usual while others are fighting or suffering”, according to Mach. There is an image of Switzerland that equates neutrality with complacency and the accruing of wealth. “CSR calls for action and engagement; it is not very compatible with neutrality,” Mach adds.
Swiss modesty, meanwhile, causes problems when caution and discretion develop into secrecy. Switzerland’s ethical Achilles’ heel is its reputation as a place where money can be hidden with no questions asked. A cliché persists of Swiss bank vaults stuffed with Nazi gold and other ill-gotten gains, though experts say this is exaggerated in foreign eyes.
“Swiss banking secrecy is often misunderstood as a total secrecy and that is not at all the case,” says Christoph Stückelberger, director and founder of Globethics.net, a Swiss ethics research and networking group. “A lot has improved in the last five to 10 years. Swiss anti-money-laundering legislation has been strengthened [to be] one of the strongest in the world.”
Jean-Pierre Méan, president of the Swiss chapter of the international non-profit group Transparency International, agrees. “There is very little left, if anything,” of Switzerland’s notorious banking secrecy, he says. The Swiss have worked to move beyond their ingrained Calvinist belief that “money is good as long as you don’t show it”.
Switzerland has learned to react quickly when its probity is questioned. In 2009, the Organisation for Economic Co-operation and Development placed it on a “grey list” of tax havens, a move that led to a flurry of lobbying and reform by the Swiss government. Switzerland was removed from the list after six months.
Swiss corporations have also learned to respond more effectively to criticism. Antoine Mach says Swiss modesty can be a benefit because “corporate responsibility communication that is modest and discreet can be more credible”. But there is a balance to be struck. Swiss corporations should not interpret the Sonderfall Schweiz concept to mean that they do not have to justify their actions.
The classic example of this was the long-running controversy over Nestlé’s marketing of baby milk formula in developing countries. Nestlé was accused of putting profits before the health of mothers and infants, and handled the resulting controversy badly. The company took “an arrogant position”, says Mach. “They did not understand that they had to explain about their impact. But now they have understood.”
Socio-economic statistics obtained from recent publications from the CIA Factbook and the Human Development Index.
Corporate responsibility data obtained from a June 2011 Ethical Corporation survey. The small sample of this survey means that the results should be regarded as an indication of trends in Switzerland and not as scientific research.
Guideline and standards statistics obtained during June 2011 from official website of each initiative.