The Romanian corporate social responsibility (CSR) scene has changed steadily over the past few years, making significant strides toward maturity. But although there is still a huge gap between the local CSR market and far more developed ones, companies have started to take a more strategic approach to CSR projects.
By Anda Sebesi
Long-term programs with a significant impact on communities and the environment have replaced temporary ones with short-term results. Education in all its forms, the environment and the social economy are some of the areas of interest for many large companies in Romania. But what do the figures say about the investments made in this field on the local market?
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Companies have invested EUR 28.5 millions in CSR projects in Romania in the past two years, of which over 50 percent was spent in 2011, according to a study conducted by CSRmedia.ro based on public statements, interviews, CSR reports, press releases and other communications from companies between January 2011 and December 2012. The research also found that the majority of CSR investments in 2011 were made by companies in the oil, telecommunications and banking industries.
Dragos Tuta, managing partner at The CSR Agency, a management consultancy company specialized in CSR and sustainability, says that at present it is mainly multinational companies operating on the local market that follow the principles of sustainability when designing their CSR strategies. “They do it either at the recommendation of the group’s representatives or because they have a very determined and ambitious CSR coordinator,” says Tuta. In his opinion, the only employee that can determine a company’s degree of “responsibility” to its stakeholders is the general manager. “Without a determined and well trained CEO in the field of sustainability, we can’t talk about an involved management team, clear results and objectives for a CSR coordinator or strategic priorities and efficient projects. As a result, an involved CEO is the minimum condition for responsibility in an organization,” adds the consultant.
Social economy gains ground
While in other countries social enterprises play a significant role in the economy, Romania is still far from being a flag-bearer for the social economy. But there is great potential for the future as the legal framework that regulates these concepts is becoming clearer. This potential has started to be capitalized upon by several companies that have decided to invest in dedicated CSR projects. For example, at the end of January Petrom in partnership with NESst Foundation launched the Fabricat in Tara lui Andrei competition, which aims to develop social businesses in local communities in Romania. In March, a jury selected 20 finalists from 512 applicants, with the companies who got the nod drawn from agriculture, the textile industry, education, wood-processing, vulnerary herbs, food, construction materials, manufacturing and furniture. The 20 finalists will be provided with consultancy to help transform their idea into a business plan and will receive EUR 1,500 to conduct local research in their communities. By the end of this year, the 10 program winners will receive a total grant of EUR 350,000 to start their social businesses with help from Fabricat in Tara lui Andrei experts in fields such as financial management, legal, marketing and distribution. “Fabricat in Tara lui Andrei has two major objectives: to create jobs and ameliorate some social problems facing Romanian communities,” says Mona Nicolici, manager of community relations at Petrom. “We designed this project as a complex competition that, first, educates participants in the spirit of social entrepreneurship and, second, offers them financing to start a sustainable business. I think that social businesses can in time become a recipe to solve the problems of Romanian society.”
Elsewhere, UniCredit Tiriac Bank has also decided to support social economy projects. Last year the lender, along with NESsT Foundation, gave financial support to four projects selected through the Your Choice, Your Project competition. It provided existing social enterprises that proved their worth with financial support for extending or consolidating their activity. The winners received EUR 7,500 each while UniCredit’s employees voted for one of them to receive an additional award of EUR 2,000. “During this difficult time, social entrepreneurship is an efficient solution through which we can intervene in areas that need support, involving the targeted beneficiaries directly,” says Anca Nuta, director of identity and communication at UniCredit Tiriac Bank. “It is an excellent example of using business tools to generate social effects and contribute to the development of the community we are part of. Although social enterprises are new in Romania, UniCredit Foundation has been developing projects since 2007.”
Companies and NGOs join hands
Currently, many companies on the local market are working in partnership with NGOs to develop environmental, health, educational and cultural projects for local communities. Meanwhile, local communities, through NGOs, have adopted new forms of fundraising to support local development. This is because the Romanian state has been unable to finance NGOs’ projects, while the number of social problems has increased significantly. “A partnership between a company and an NGO is the result of a natural step in the development of the community and CSR projects initiated by companies. Through such partnerships, NGOs help communities that cannot support themselves, while companies develop sustainable CSR projects through ongoing and long-term sponsorship programs,” say representatives of Vodafone Romania. Over time, the company has worked with many NGOs, supporting emergency services such as Salvamont (since 2004), SMURD (since 2005) and Salvamar (since 2007). The Vodafone Foundation has also supported various NGOs in fields including health, education and the prevention of family abandonment since it was set up, back in 1998.
Volunteering is the key to success
Companies across a range of industries have started to engage their employees in various stages of their CSR projects, with Raiffeisen Bank and BRD-Groupe Societe Generale two such examples from the banking industry. “The projects we support would not have been as successful without Raiffeisen Bank’s volunteers. Our colleagues’ support and involvement in our projects and their expertise in different fields of activity have helped us to increase the impact of our contribution to the community,” say representatives of the lender, adding that the number of employees involved in volunteering has increased from one year to the next. “Over 200 Raiffeisen Bank employees participated in volunteering activity and spent an average of one working day on community programs in 2012– three times more than the previous year.” United Way and financial education programs are the most popular among the lender’s staff.
Involving your employees in your CSR programs has an even greater impact. According to Raiffeisen Bank data, volunteering has helped employees to improve their personal, management and work efficiency and had a significant individual impact. For example it increased widely workers’ ability to solve problems (20 percent) and communicate (40 percent), and improved to some degree their negotiation skills (28 percent), decision-making (58 percent), leadership abilities (43 percent), attention to the company’s objectives (48 percent) and attention to customers (38 percent).
Companies reap benefits of sustainability reports
So far, several companies publish their sustainability reports on the local market, including Coca-Cola HBC Romania, Heineken, GlaxoSmithKline and Raiffeisen Bank. Publishing a CSR report should be a crucial step for the stakeholders of all companies. But Tuta of The CSR Agency says that the local market is different. “No one asks companies for a CSR report and in my opinion they won’t for the next three-five years in Romania. While the European Commission will ask for this reporting to be compulsory, this will not change the so called ‘state of the nation’,” says Tuta.
In his opinion the main benefit of reporting is an internal one. “Companies learn to measure the impact and identify much more easily the strategic directions they need to take. In the first two years of reporting the non-financial results, every company makes an effort to learn, adapt and understand both the technical issues and sustainability principles,” adds Tuta. The consultant notes that it is compulsory to use reporting guides such as the Global Reporting Initiative (GRI) or Global Impact because only with a precise set of indicators and clear reporting principles can you measure and see the impact every year.
Laura Sgarcitu, CSR coordinator at Coca-Cola HBC Romania, says that more and more companies have got involved in CSR activities in the past few years, and a more strategic approach in this field has emerged. “Companies are presenting evidence of more planning and vision in their involvement in CSR projects. That’s why I think that the next natural step will be to start reporting these activities,” says Sgarcitu.
Coca-Cola HBC Romania, for example, launched its first country sustainability report last year. It is also the first such report in the FMCG industry that meets the international regulations in the field (GRI). The GRI reporting standard is a system based on indices, which enables the company to see progress from one year to another. “The sustainability report helps us to evaluate better our local actions and get precise and relevant results for our areas of interest. It is also proof of transparency and commitment to the community. Through it we can inform all of our stakeholders about the projects with which we intend to amend things: to protect sources of water, increase the recycling rate, support the development of communities or encourage a balanced lifestyle,” says Sgarcitu.
Another company that has published its sustainability report is Heineken Romania. The brewer launched its first issue back in 2010 and its objective is to track the progress the company has made against its Brewing a Better Future Agenda. “Brewing a Better Future represents our long-term global ambition to become the world’s greenest brewer by 2020,” says Onno Rombouts, managing director at Heineken Romania. “We have implemented this sustainability strategy in Romania and we have added local ambitions and programs to it. Our annual sustainability report measures our ongoing evolution against the targets set both at global and local level, and outlines our plans in each of the three main areas of the sustainability agenda: the environment, society and the communities where we operate.”
In his opinion, companies that already publish their sustainability reports with clear and relevant information prove their transparency and respect to their external stakeholders. “The fact that companies in Romania have already started to publish sustainability reports sets a standard that will be followed by the companies that start publishing their own sustainability report. In fact, the area of sustainability will become more and more competitive and this will generate progress,” predicts the managing director.
A sustainability report is the best argument to show how CSR is part of a company’s business strategy and integrated in its sustainable development plan. “In this context I would say that sustainability reporting is a sign of the maturity of the Romanian CSR market and of the responsibility of the whole local business market,” adds the representative of Coca-Cola HBC.
HR in CSR
Tuta of The CSR Agency says that there are three major challenges in the training of CSR specialists on the local market: the lack of success models and valuable debate about this field, lack of education and experience in the field of management and specialized know-how. “Those who get on working in CSR do so accidentally,” says Tuta, of the state of the local market. In order to counteract this situation and to support the development of the market, The CSR Agency has initiated two projects as part of the CSR Think Tank (the Community of CSR Coordinators in Romania): CSR Juniors and CSR Debates. While CSR Junior seeks to provide training, practice and professional support for youngsters who want to start a career in this field, CSR Debate intends to create themed debates between the CSR coordinators of the largest companies in Romania. “Last but not least, the internet is full of articles, books and courses about CSR and sustainability. The problem comes just from the huge amount of information, lack of organizations with authority and many wrong approaches in the field, which appear reasoned in detail and sometimes even credible on the internet,” adds Tuta.
Box: Remit of a CSR specialist:
- To understand the way a company, market and the business environment works;
- To understand the principles of sustainability and the way they reflect on the business environment and company;
- To know from the start that CSR is not a communication field and does not mean sponsorship, donations, planting trees, recycling or cleaning up polluted areas;
- To take charge of management activities;
- To coordinate department managers in stakeholder engagement and research activities, helping them identify and set strategic objectives, and find the most efficient strategies and projects in order to achieve their goals;
- To evaluate and report the impact for each indicator and to follow up with the company’s stakeholders.
Source: The CSR Agency
Environment and education lead the way
Many companies are focusing on environmental and education projects as these seem to be among Romanian society’s top priorities. Carpatcement Holding’s CSR strategy consists of several main areas of action: involvement in the local communities where the firm operates (education, environment, infrastructure), the environment, ensuring a proper work environment, promoting human rights, permanent improvement of work, safety and health conditions for its employees and ensuring freedom of association and collective negotiation. “Quarry Life Award was one of the most important environmental projects developed by Carpatcement in 2012. It was a scientific and educational competition developed at international level that sought to discover new ideas about the preservation and promotion of biodiversity. The project will also continue this year too,” says Bogdan Arnautu, manager of the communication department at Carpatcement. He adds that another area of sustainable development for the company is using alternative fuels in manufacturing processes. “Carpatcement was the first company in Romania that used alternative fuels in its plant in Deva, back in 2004,” adds Arnautu.
Apa Nova Bucuresti is another company that has the environment as a priority in its CSR strategy, because it is the subsidiary of Veolia Eau in Romania, the water division of Veolia Environment group. “The group is remarkable in the fields of sustainable development and environmental services. On top of that, we work with a precious natural resource, essential for all forms of life, which is more affected by the impact of human activities on the environment,” says Oana Ersova-Ranetti, public relations specialist at Apa Nova Bucuresti – Veolia Apa. The company’s environmental projects include: Veolia Park in Tulcea (EUR 30,000); populating the Danube Delta with sturgeons (EUR 10,000); the repair of the Sfantu Gheorghe water treatment plant and addition of a new chlorination station (EUR 30,000); the repair of the bulrush netting workshop in Mahmudia (EUR 10,000); forestation campaigns conducted individually and in partnership with Viitor Plus Association (EUR 15.000); supporting the campaign, Saving the Curly Pelican in the Danube Delta (EUR 10,000); Reciclonada (collecting all types of recyclable waste); and the Recicleaza Pentru Copaci internal project in partnership with Viitor Plus Association. “Environmental issues in Romania are extremely pressing. It is no different from Europe or worldwide, but Romania needs to mobilize more to protect it in a concrete manner with tangible results in this field,” urges Ranetti.
Education is another priority for many local companies. For Actavis, it has been a significant part of the firm’s CSR strategy since the beginning. “Investment in educational programs became a natural priority of our CSR activity. The first step we made was 20 years ago with the Actavis Sustine Performanta project, devised to reward the high marks achieved by students at the International Chemistry Olympiad. We decided to extend the project to universities this year,” says Ana Maria Draganica, communication manager at Actavis. With the Actavis operations team (Sindan Pharma manufacturing) the company will support the medicine section of the Studentul Anului project, helping students from the medicine and pharmacy faculties. “In an extremely competitive and dynamic environment, CSR programs help us to position ourselves correctly and secure loyalty to the Actavis brand,” concludes Draganica.