Academic journal article Journal for East European Management Studies

Corporate Social Responsibility of Hungarian SMEs with Good Environmental Practices

Academic journal article Journal for East European Management Studies

Corporate Social Responsibility of Hungarian SMEs with Good Environmental Practices

Article excerpt

1. The contribution of CSR to sustainable development

The actors of the economic sector have an important role in the realisation of sustainable development. Company level sustainability and corporate social responsibility (CSR) are popular issues among policy makers and company representatives as well. The concept of corporate social responsibility was emerging in Europe as early as from the 1990s, getting popular in Central and Eastern Europe with some significant delay, from the mid 2000s. Entering the European Union also contributed to the spread of CSR in new Member States, by making EU documents relevant and fostering the concept among decision-makers. According to the green paper of the European Union CSR is "a concept whereby companies integrate social and environmental concerns in their business operations and in their interaction with their stakeholders on a voluntary basis" (European Commission 2001:8.). Corporate Social Responsibility involves several issue areas: environmental protection, countering bribery, respecting employees' rights and philanthropic activity as well. Most of these are extremely relevant in the CEE region. In the latest communication by the Commission, the voluntary nature of CSR is not stressed any more, and the definition only states that CSR is "the responsibility of enterprises for their impacts on society" (European Commission 2011:6). The communication also highlights that "respect for applicable legislation, and for collective agreements between social partners, is a prerequisite for meeting that responsibility" (European Commission 2011:6). It is still an open question whether, or to what extent CSR can contribute to sustainability goals. There are some aspects of the CSR concept that make it more acceptable and feasible for companies than the "ambiguous" concept of sustainable development. While sustainability investigates the system of relationship of the "economy-society-nature triangle" starting from the macro level and from the aspect of global problems (effects), CSR does the same starting from the micro level, from one of the "causes" of the problems, the companies. Corporate social responsibility is a self-defining concept, while sustainable development can easily be misinterpreted by decision-makers, e.g. as sustainable "economic growth" which is basically controversial to the idea of environmental sustainability. However, there are some negative aspects of "letting companies do the best they can". For example, Málovics et al. (2008) conclude that the contribution of CSR to sustainability, especially strong sustainability, that is, the preservation of natural capital, is limited.

The new CSR strategy of the EU suggests that the scepticism about CSR was partly established, the communication published in 2011 highlights that CSR should be more definite and transparent, results should be more measurable and sector specific development is also desired. The special conditions of SMEs are also mentioned in this document, "...In implementing this agenda, the Commission will at all times take account the particular characteristics of SMEs, espe- dally their limited resources, and avoid creating unnecessary administrative burdens" (European Commission 2011:8), all of which is in harmony with our research findings.

2. The importance of SMEs' social responsibility

CSR is mostly interpreted as the contribution of large enterprises, corporations to sustainability, although the behaviour of SMEs due to their important role in economic production and employment as well as their consumption of natural resources and the total emission they are responsible for, is also essential. As former European Commissioner for Enterprise and Industry, Günter Verheugen stated: "Micro, small and medium-sized enterprises (SMEs) are the engine of the European economy. They are an essential source of jobs, create entrepreneurial spirit and innovation in the EU and are thus crucial for fostering competitiveness and employment" (Günter Verheugen in European Commission 2005: 3). …

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