EAE Business School presents its Sustainability Observatory in Barcelona | EAE

This is the conclusion of the 2nd Sustainability Observatory in Ibero-America drafted by EAE Business School 

in collaboration with the CEIB (Council of Ibero-American Businesspeople) and the FIJE (Ibero-American Federation of Young Businesspeople). Based on the opinion of around 300 companies and associations from 20 countries operating in all sectors, the objective of the report is to gain greater insight into the current situation and trends in relation to CSR in companies. The report was presented at EAE Business School Barcelona, with the participation of the Dean, Dr. Enric Ordeix; the Director of Companies for Sustainable Mobility, Director of EAE Business School’s MBA in Sustainability and author of the report, May López; the Public Affairs, Communication & Sustainability Associate Director of Coca-Cola European Partners Iberia SLU, Igone Bartumeu; the Director of Sustainable Development and Equity at Agbar, Dulcinea Mejide; the Director of Sustainability and Climate Change at PwC Latam, Margarita Casas; and the General Director of Nacex, Manel Orihuela.

As Dr. Enric Ordeix, Dean EAE Business School Barcelona, emphasized “working our way towards full sustainability requires everybody’s commitment. The data on over 300 companies collected for the report highlights that this commitment is already taken seriously: 40.2 % of the companies surveyed have included the SDGs and Agenda 2030 into their strategy; 26.1% are in the process of doing so; and 3 out of 4 companies acknowledge that CSR has become a new way of doing business”.

“The commitment to climate neutrality and, as a result, to the decarbonization of the economy, with legislation such as the EU’s taxonomy regulations, has led to the start of divestment in oil, gas and coal, which has been further complicated by the energy speculation triggered by the current war in Ukraine. This situation affects Ibero-American organizations, driving them to prioritize SDG 7 as one pf their key overall objectives”, explained May López, the author of the report and Director of EAE Business School’s MBA in Sustainability Management. After the goal of affordable, clean energy, the United Nation’s Sustainable Development Goals (SDGs) prioritized by organizations are SDG 5, gender equality, and SDG 3, good health and well-being.

The research also reveals that, nowadays, CSR is strongly defined by the environmental concern (40,1%), ethics (38.8%) and integrity (26,9%) of organizations, equally in the case of companies, associations and SMEs. Moreover, climate change (24.5%) and the economic crisis (24.5%) head the ranking of the main risks faced by Ibero-American organizations over the coming years, with large companies being most concerned about the legacy they will leave in terms of taking care of the planet and natural resources. The third most pressing risk faced by organizations is the last of the 3 Cs: cybersecurity, which reflects the growing concern among companies for protecting their data and information.

At a geographical level, the report also highlights a greater preference for the global application of CSR plans in countries in Europe, namely Spain, Portugal and Andorra, in which they are applied in 74.4% of the cases, compared to countries Central and South America, where the figure is 47.4%. This difference is partly due to the European Commission establishing regulations that affect EU companies to a greater extent, but which have implications for the entire value chain.

EVOLUTION OF CSR

In the discussion that followed the presentation of the report’s main conclusions, there is an emphasis on the positive evolution of CSR in companies, which has steadily contributed towards greater strategic definition and development. “More solid projects have gradually evolved. Thanks to the SDGs, companies can embrace their commitment, while, at the same time, setting objectives, measuring results, making cross-cutting progress and involving the whole company. Sustainability is a matter of business strategy. Nowadays, a company without a purpose makes no sense” explained Igone Bartumeu, the Public Affairs, Communication & Sustainability Associate Director of Coca-Cola European Partners Iberia SLU.

With respect to CSR within companies, Dulcinea Meijide, the Director of Sustainable Development and Equity at Agbar, believes that “professionalism has helped us define what sustainability is. Not only is it important to identify the goals, but we also need to we focus on how we can contribute towards achieving them. It is crucial to be ambitious, but also to focus”. Moreover, Mejide argued that “sustainability enriches companies’ strategy, as well as the Boards of Directors. Sustainability is part of the solution”.

Meanwhile, Manel Orihuela, the General Director of Nacex, emphasized that “sustainability must form part of the company’s culture, but also part of the entire chain of suppliers, customers, partners, etc.”. The senior executive of the company explained that, in 1997, they decided to innovate and replace the carbon paper used for their delivery receipts for laser copies. The company now has a wide range of environmental measures in place that “enable us to reduce plastic consumption by 30 tonnes per year”, as well as many CSR initiatives. “We recycle plastic bottle caps collected from individuals and companies. They are taken to a recycling plant and made into car parts. The money raised goes to the NGO Asdent. We have recycled 120 tonnes of plastic caps since the start of the project”.

Lastly, Margarita Casas, the Director of Sustainability and Climate Change at PwC Latam, who took part virtually from Colombia, explained that “our mission is to generate trust and resolve important problems, such as immigration, poverty, climate change. These aspects are at the heart of PwC, but we also see them in companies throughout the Americas, and increasingly in small and medium companies. These organizations are implementing their CSR through a diverse range of measures, such as drafting Sustainability Reports”.

SDG AND ESG AT THE HEART OF CSR STRATEGY AND MATURITY#

The 2nd Observatory highlights the key role of the Agenda 2030 and the Sustainable Development Goals (SDGs) that have been incorporated within the strategy of 40% of the organizations surveyed. In Europe, the integration is under way in 84% of companies, compared to 63% of those in Central and South America. The incorporation of the SDGs involves establish ESG criteria (Environmental, Social and Good Governance). In this regard, 70.1% of Ibero-American companies have already integrated such criteria (39.5%) or are in the process of doing so (30.3%). These criteria enable us to measure the organization’s impact and evolution in this respect.

According to the Observatory, 3 out of every 4 of the organizations surveyed (75,4%) agree that CSR will become consolidated as a natural way of doing business, in the same way as other aspects have done, such as quality.

“For the first time in history, we are witnessing a sustainability crisis. We are facing a lot of challenges and we run a great risk unless our response to this sustainability crisis is consistent, efficient and coordinated”, explained López, the author of the report and the Director of EAE Business School’s MBA in Sustainability Management. “As well as posing a challenge, this crisis is an opportunity to definitively integrate CSR and sustainability strategies throughout all kinds of organization, thereby contributing to the economic, social and environmental recovery that all the different stakeholders are demanding”, emphasized López.

The research shows that identifying and fulfilling the stakeholders’ expectations in order to offer a balanced value proposition for everybody has become the most important objective for 52% of Ibero-American organizations. In this respect, the stakeholders Environment (14.9%), Society (14.5%) and Customers (14.2%) are gaining ground among companies, followed closely by Governance (13.9%) and Employees (13.8%). Moreover, there are differences between continents, with larger companies and those based in Europe placing greater importance on the Environment. SMEs and companies based in the Americas focus more on their concern for the Employees.

THE FIGURE OF THE SUSTAINABILITY DIRECTOR: GREATER SPECIALIZATION AND A MORE CENTRAL ROLE

The cross-cutting strategic importance of issues of sustainability has made it increasingly evident that companies need to appoint a director or professional in charge of sustainability, which currently reports to the General Management team, the President or the Board of Directors. In recent years, we have witnessed a shift from “soft law to hard law” in terms of sustainability, primarily due to new legislation from the European and the rigidity of the regulations, which is reinforced by the role of the Sustainability Director. This shift can be seen by the fact that one in four Ibero-American organizations now has a department dedicated exclusively to CSR. This percentage has climbed from 82.9% to 90% in the last two years in the case of large Ibero-American companies, which generate revenues of over a billion dollars.