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Sustainability in corporate decision-making

Contact University of Deusto for this project

Jose M. Guibert
Professor of Innovation Management and of Professional Ethics
University of Deusto
Mundaiz, 50
20012 - San Sebastian - Spain
guibert@eside.deusto.es
Phone: +34 943 326320
Fax: +34 943 273089











Contact Tilburg University for this project

Kees Koedijk
Professor of Financial Management
Faculty of Economics & Business Administration
Tilburg University
c.koedijk@uvt.nl
Phone: +31 13 466 3048





















Contact University of Mannheim for this project

Ulrich Oberndorfer
Research Fellow
Department of Environmental and Resource Economics
Environmental Management
P.O. Box 103443
68034 Mannheim, Germany
oberndorfer@zew.de

Michael Schröder
Head of Department International Finance and Financial Management
schroeder@zew.de

University of Deusto

At the University of Deusto there is some significant research that has been done in the area of Corporate Social Responsibility (CSR). There is an interdisciplinary research focused on CSR . The group is composed of 13 Professors and Academic Researchers which come from the interplay of the following research teams:

- KN Ikerteam. Research team formed in September 2000 which seeks to extend the interest in the study of the relationship between marketing and society in the academic, research and entrepreneurial communities.
- RSCI team. The research group has carried out work related to ¿Human Resources¿ always in the field of business and organizations. Work has been done in the area of ¿managing of people¿ linked to the issues of values, ethics, emotional intelligence, leadership, worker participation, equity, and so on.
- SME team. The scope of work of the team is to study small and medium enterprises (SME), with particular interest in the family business, the two groups that are an essential part of business and that are critical to economic and social development.
- Organizational Ethics Group. This team works a wide line that seeks an ethical approach to the field of economics, and in particular the scope of the organizations that are part of it. Since 2002 it deals with a line on social responsibility in the organizations.
- Relevant accounting information for decision making. This team has conducted research on the information that large European companies, listing on the stock exchanges, provide on their CSR activities and policies.

Tilburg University

Key research theme: Sustainability in corporate decision making: Studying sustainability, corporate social responsibility and the implications for firm strategy, innovation and decision-making. Determining the conditions and outcomes of successful sustainable corporate decision-making. Increasingly the importance of the concept of sustainability for business firms is acknowledged. Of course the current debate on climate change and the implications for firms and societies helped in that respect. While sustainability used to be seen by many firms and organizations as an impediment for future growth, it has now become an integral part of firm strategy and used as a competitive edge.

Well known examples in this respect are companies like Toyota, Nike and in the Netherlands companies like TNT, Unilever and Philips. Increasingly large institutional investors are also paying attention to socially responsible investment and corporate social responsibility. It has been come increasingly clear through recent research that sustainable investments can be an attractive extra asset in institutional portfolios. Leading institutional investors like ABP, PGGM and the Norwegian petroleum fund have made sustainability a core element of their investment philosophy.

The big challenge for research in this area is to substantiate the many questions related to corporate social responsibility and socially responsible investment and to help integrate these two concepts for European firms and organizations. Fortunately a wide range of new data-bases have become available to investigate the importance of various sustainable factors for firm behaviour. Examples include Innovest, SAM, and Vigeo to mention a few. These new empirical facts will also help in formulating and enriching new theories of sustainability and its implications for corporate decision-making.

Relevance to future of European societies
Sustainability is very high on the agenda of Europe. In this very rapidly changing world innovation and corporate social responsibility become central factors for the competitive position of firms and heavily influence the capacity for renewal. The future welfare of Europe will to a large extent on the issue of sustainability and more in particular on its ability to fully integrate the concept of sustainability in the full business process.

University of Mannheim

Keywords: business case of corporate social responsibility, environmental innovations, financial market responses to corporate social responsibility. Knowledge about the effect of corporate social responsibility (CSR) on corporate economic performance is highly relevant. For example, it contributes to the debate about whether managers systematically miss profit opportunities if they decide against the protection of the natural environment or the support of social norms. Moreover, this question is crucial for environmental and social policy: If a positive economic effect of CSR really exists, it could, for example, be argued that traditional less cost-efficient mandatory command and control regulations or market based instruments should be relaxed in favour of information-based regulations.

Theoretical reasoning and existing evidence suggests that there are different aspects of the relationship between CSR and economic success. They particularly encompass financial market responses to CSR and environmental innovations that are assessed playing a key for possible positive economic impacts of CSR. Against the background of a possibly complex and dynamic relationship between CSR and economic success, especially the question about causal effects has not been satisfyingly resolved, yet.
 
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