Corporate(social(responsibility(as(a( consulting(product( (The(consultants ( perception(
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1 Corporate(social(responsibility(as(a( consulting(product( (The(consultants ( perception( JürgenBeyer DiscussionPaper2011/2 ISSN2196<615X
2 DiscussionPaper2011/2 CORPORATE(SOCIAL(RESPONSIBILITY(AS(A(CONSULTING(PRODUCT( THE(CONSULTANTS (PERCEPTION Abstract: The article analyses the role of consultancy firms for the dissemination of socially responsible business practices. Based on six expert interviews with consultants and executive directors, it ascertains the perspective of consultancy firms. Predominantly, the consultants considerthemselvestoplayanactiverolewithinthisprocess.fromtheirperspective,theyarethe oneswhopreparethegroundfortheissueofcorporateresponsibilityanddeliberatelypickupand strengthen trends. Therefore, the selfdperception of the consultants complies with an interpretationinlinewiththesociologyofmanagementratherthanwiththeperceptionofneod institutionalistorganisationalresearch. Keywords: Corporate Social Responsibility, Consultants, Germany, Management; NeoD Institutionalism 1.(INTRODUCTION( Nowadays,voluntarycommitmenttosocietyandtheenvironmentisgivensteadilygreaterpriority in many companies (Lougee & Wallace 2008; SahlinDAndersson 2006). More and more, the companies commit themselves to compliance with social and environmental standards that go beyondlegalrequirementsorsupportsocialprojects(carroll1999;dahlsrud2006;l Etang1995; Pinkston & Carroll 1996). In this context, they increasingly communicate their commitment by means of corporate social responsibility and sustainability reports, product and corporate advertising, press releases and own internet pages (Aras & Crowther 2008, Ballou et al. 2006, Hartmannetal.2007,Morhardtetal2002,Pomering&Johnson2009).Atorganisationallevel,it turns out that the companies prepare for continued occupation with the corporate social responsibility issue. CSR is considered as a management task, CSR executives are hired or CSR departments set up (Brammer & Millington 2004; Cartland 2010; Windell 2007). In addition, numerousinitiativeshavebeenlaunchedoverthepastyearsbygovernmentorganisations,ngos, foundationsandcompanies,whichdisseminatetheguidingideasofcorporatesocialcommitment. The most renowned of these initiatives are the United Nations Global Compact (Cetindamar & Husoy 2007; UN 2009) and the Global Reporting Initiative (GRI 2010; Willis 2003). At European level,owncsrstrategieshavebeendevelopedforinstancebythecorporatenetworkcsreurope (CSREurope2011;Matten&Moon2004)andtheEuropeanUnion(EuropeanParliament2007; Herrmann2004).Paralleltothisdisseminationprocess,itcanbeobservedthatconsultancyfirms attach increased importance to the issue of corporate social responsibility, developing and offering corresponding consultancy products. The present article focuses on the perspective of corporateconsultantswhoimplementsuchcsradvisoryprocesses.itisbasedonanevaluationof 1
3 DiscussionPaper2011/2 interviews held in German consultancy firms. The objective of the analysis is to answer the questionofwhichrolecorporateconsultancyfirmsplayforthedisseminationofcsractivities.do they fromtheconsultants ownpointofview contributeactivelytotheestablishmentofcsr practicesasanewmanagementtrend,aretheyratherrestrictedtotheroleof diffusionagents (Hasse & Krücken 2005: 26; Matten 2005) for practices already asserting themselves in the organisational field of the companies asking for consultancy, or is their role in the process of establishingcsrpracticesactuallytobeconsideredasnegligible? 2.(DISSEMINATION(OF(MANAGEMENT(KNOWCHOW(BY(MEANS(OF(CONSULTANCY( Inthebusinessworld,theuseofconsultancyfirmsforthepreparationoforganisationalchange hascometobeamatterofcourse(clark1995;faust2006;kipping&engwall2002).theincreased significanceofcorporateconsultancyisreflectedinthefactthatconsultantsarebeingdescribed as the new reflection elite (Deutschmann 1993) and some researchers even refer to the emergence of consultancy capitalism (Resch 2005). In most cases, attempts at explaining the highsignificanceofconsultancyfirmsrefertoincreasedcomplexityofthebusinessenvironment, which,inthemeantime,managerscouldnolongercomprehendandhandlealone.asaresultof globalisation, new technologies and stiffer competition, managers now had to draw on the supportfromconsultantsasamatterofroutine(ernst&kieser2002). However,therearedifferentassessmentsoftheroleplayedbyconsultancyfirmsintheprocessof disseminatingmanagementknowdhow.thesociologyofmanagementconsultancy(deutschmann 1993;Ernst&Kieser2000,2002;Faust2002;Kieser1997;Salaman2002)holdsthatconsultancy firms play an active role in the development and dissemination of management trends and fashions,thusgivingrisetoeverdnewconsultancyrequirements.consultantsunveilandpointto problems and, at the same time, promise to know the solution. From this perspective, the consultants powerofdefinitionregardingtheinterpretationofproblemsisconsideredasbeing extremelyhigh.animportantaspectofconsultingactivityistofirstandforemostcreateproblem awarenessonthepartofpotentialcustomers,i.e.seetoitwithinthemeaningof agendasetting thathighimportanceisattachedtocertainissuesbythedecisiondmakers. By implementing the management recommendations given by the consultants, the advised company s management can then consider itself to be in line with the trend and act appropriately.however,theconsultingrecommendationstendtobevalidonlyforashortperiod oftime,sothateverdnewconsultancyrequirementsresult.assoonastheconsultantshaveleft thecompany,newquestionsanduncertaintiesarepoisedtoarise,forinstanceaboutwhethera lastingadvantageoverthecompany scompetitorshasindeedbeenachieved.asaconsequence,it seems required to take new management concepts into consideration, which were once again launchedbyconsultantsandonceagainrequireconsultantstoimplementtheminthecompany. In this way, a continuous change of management knowdhow is stimulated through consulting initiatives(ernst&kieser2002;kieser2005).inthissense,itwouldbepossibletoattributethe 2
4 DiscussionPaper2011/2 increased activity of companies in the area of corporate social responsibility to the activities of consultancyfirmsaspiringtoestablishcsrasamanagementtrend. Another theoretical approach to analyse the dissemination of CSR activities is the neod institutionalistorganisationaltheory(boxenbaum2006;campbell2007;hiß2006,2009;höllerer & Meyer 2007). This theory acts on the assumption that every society has a set of rules and guidingprinciplesthatdefineandestablishaframeworkastohoworganisationscanbeshaped and which tasks they are allowed to perform or not. Certain elements such as accountancy, electronicdataprocessingandperhapsalsocsr arehenceconsideredasrightandnecessaryon the grounds of shared social values and views. Organisations meet these social expectations in ordertosecurelegitimacyandsafeguardtheflowofresources(meyer&rowan1977,dimaggio& Powell 1983). From a neodinstitutionalist perspective, the structures and procedures of an organisation cannot simply be derived from efficiency and competition considerations, but are rather based on myths of rationality. These are understood as rules and sets of assumptions, which are rational insofar as they define social objectives and establish regulations governing whichmeansareconsideredappropriateforthepursuanceofthesepurposes(walgenbach2006: 359).Theyhaveamythicalcharactersincetheirefficacyisbasedonsharedbeliefs. In neodinstitutionalism, the framework within which institutionalisation takes place is conceptualisedasan organisationalfield (DiMaggio&Powell1983).Acompany sorganisational fieldincludesallorganisationscapableofexertinginfluenceonitsstructure,conductandsurvival (Walgenbach2006:368).Thesecanbeprovidersandconsumersofresourcesandproducts,public authorities and competitor companies, subcontractors, political regulators and scientific organisations, but also nondgovernment organisations (Hasse & Krücken 2005). With respect to CSR,allorganisationswithinasocietyarerelevantaccordingtoHiß(2006:126),whichdealwith theissueofcsrfromdifferentpointsofview,i.e.notonlytheusual stakeholders ofcompanies, but also for instance churches, political foundations and technical and financial foreign aid organisations. From the neodinstitutionalist perspective, corporate or organisation consultancies contribute primarilytothedisseminationofrationalitymyths.theyare diffusionagents (Hasse&Krücken 2005: 26) of these myths. Consultants provide companies with important aid to orientation by offering tried and tested problem solution practices. In this context, consultancy turns into a legitimationresourceforthecompaniesseekingadvisoryservicesinthreedifferentways(meier 2004: 223): through the (1) mere involvement of a renowned consultancy firm, modern and rational organisational leadership can be demonstrated to the inside and, in particular, to the outside world; through (2) implementation of the changes proposed by the consultants, which comply with the respective prevailing management practice, legitimacy can be gained and (3) consultantsareabletoconfirmexistingorcreatedstructuresasthestandardofrationality.froma neodinstitutionalist perspective, consulting firms are therefore of particular importance when it comes to securing the legitimacy of management activity and to the standardisation of such 3
5 DiscussionPaper2011/2 management activity. However, shared organisation concepts are developed across the entire organisationalfieldandcanhencebeattributednotsomuchtotheinitiativeofconsultancyfirms. Beside the views of management research and the perspective of neodinstitutionalist theory, a number of further explanations on the increased dissemination of socially responsible entrepreneurial acting also play a role in the scientific debate. For instance, it is possible to distinguish in analytical terms between normative, capitalismd and globalisationdtheoretical and economicapproaches(bluhm2008),thejointcharacteristicofwhichisthattheydonotattachany importance to consultancy firms. Normative approaches are based on the assumption of normd oriented, voluntary social commitment of the companies and their managers or owners. CapitalismD and globalisationdtheoretical approaches consider social corporate commitment as being the consequence of market deregulation and the growing influence of capital markets. Capitalmarketactorsareseenasputtingincreasedpressureonthecompaniesfortheadaptation ofcsrconcepts,whicharethencanonisedandstandardisedbysocialresponsibilityinvestment funds and sustainability indices. The argumentation of economic approaches focuses on the competitiveadvantages,whichcompanieshopetoachievebymeansofresponsibleacting(kurucz etal.2008).thepossibleadvantagesbeingreferredtoincludeforexampleimageimprovements, price advantages, higher employee motivation levels and enhanced sales opportunities for new sociallyorecologicallyresponsibleproducts,servicesandcapitalinvestments.intheseexplanatory approaches,consultingfirmsdonotfeatureasanindependentfactor,theirroleintheprocessof establishingcsrpracticesbeingeitherneglectedorexplicitlyassessedasinsignificant. 3.(THE(CONSULTANTS (PERCEPTION( Howdotheconsultantsthemselvesassesstheirinfluence?Dotheyconsiderthemselvesasbeing importantactorswhomakeactivecontributionstotheestablishmentofcsrpractices,dotheysee themselvesasinsignificantordotheyrestrictthemselvestothemereroleofdiffusionagentsfor practicesalreadyhavingbeenestablishedintheorganisationalfield?theinterviewsconductedto answerthesequestionsandquotedonthefollowingpageswereheldintheautumnof2009with executiveboardmembersofconsultingcompaniesaswellaswithconsultantsspecialisinginthe areaofcsradvisoryservices.allinall,thesurveyincludedpersonsfromsixdifferentcorporate consulting firms. The interview passages have been anonymised. As a result of numbers having been assigned to each and every interview, however, it becomes clear which statements were madeinwhichinterview. The interviews show that the persons surveyed consider CSR to be a rather difficult field of advisory services, which requires a lot of persuading. One of the interviewed persons said: Consulting in the CSR segment cannot be compared to communications consulting or organisational consultancy, not to mention a strictly businessdoriented consultancy assignment [Interview 1]. A difficulty consists in the fact that most companies have relatively little prior knowledgeasfarascsrisconcerned: Thereisverylittleknowledgeaboutthisissue,whichis 4
6 DiscussionPaper2011/2 oftenmixedupwithothertopics [Interview2].Intheopinionoftheconsultants,thisresultsfrom the fact that the term CSR is not yet firmly established in the German companies despite its scientificpopularity.forinstance,companiesarenotabletounderstandalreadyexistingactivities ascsractivities: They arecompletelysurprisedwhenwetellthemwhatcsrisactuallyabout, i.e.thatitisnotnecessarilysomethingnewandmanyentrepreneursareinvolvedinsuchactivities alreadytoday [Interview3]. SinceCSRisstillarelativelyyoungissuefortheGermancompanies,thereisnoclearallocationof competenceseitherinthecompaniessofar.contactpersonsarenoteasytoidentify;forinstance, it is possible that several departments feel responsible for a certain area, which makes the consultingprocessmoredifficult. CSRispartofdifferentdepartments,whicharepartiallystaff departmentsandpartiallysubddivisionsofthecommunicationsdepartment,itismarketingandit is human resources. The picture in Germany is very diffuse [Interview 1]. This circumstance implicates that CSR is difficult to offer as an advisory service. It is therefore classified by the consultantsasa noteasilysaleableproduct [Interview4]. Theconsultingfirmsthereforetrytoincreasinglybringtheissueintopublicfocus.Onepossibility to create public awareness [Interview 4] are lectures and the participation in conferences, workshops and panel discussions on CSR in the broadest sense. Particularly suitable are workshops,inwhichtheresimplyisan intensive thematic exchange onthe subject, where one suddenly becomes important for a company on the basis of the issues discussed, and an assignment eventually results from this [Interview 1]. At such events, the consulting firms can presenttheircsrandconsultancyapproachandarousetheinterestofcustomers: onebank responded to our presentation by approaching us and asking: Can you also do this for us? [Interview5].Intheinterviewparticipants opinion,sucheventformsarecurrentlymoresuitable to establish contacts in the advisory field of CSR than the direct marketing ( cold calling ) of customers, since,asamatterofcourse,wecanveryeasilyestablishcontactsthere,i.e.comeinto contactwithagentsandthen receiveaninvitation [Interview4]. Theconsultantsaresometimesveryfrankinemphasisingtheiractiveroleintheprocessofissue prioritisation: Eitheronesetsthetrendoneself,oronemustexploitsomeone( )whosetsthem foryou [Interview5].Anothersurveyedpersonsaidinamorereservedtone: Onecanmakea contributiontoshapingsuchviewsandtrendsbyvoicingone sopinionattherighttimeandplace [Interview 6]. By contrast, another interview partner emphasised the process of picking up thematictrends,usingtheexampleofclimatechange: thisisnowamajorissue,andofcourse weasconsultantsareanxioustoexploitthissituation [Interview4] Another possibility for the consultants to acquire assignments is personal contacts. The consultantskeeptheircontactpersonsuptodateabouttheircurrentadvisoryareacsrinorderto beapproachedorfurtherrecommendedatalaterpointintime: Sothatsomeonesays:listen, you have to bring somebody in for this purpose, why don t you call (name of the consulting 5
7 DiscussionPaper2011/2 company),iknowthem [Interview5].Inthiscontext,contactwiththedecisionDmakersisofthe greatestsignificance: Idon tneedanetworkwithmanypeoplewhoareenthusiasticaboutthe CSR issue, but cannot take any decisions. Instead, I want to be able to get in touch with the executiveboard [Interview2]. Owing to the complexity of entrepreneurial responsibility and the fact that CSR has not been firmlyestablishedyetasanadvisorysubject,theconsultingcompaniesthemselvesdonotusethe terminastandardisedwayandpartiallyreplaceitwithawidevarietyofsimilarterms(suchas corporatecitizenshiporsustainability): Wehavealwaysavoidedtousetheword social,since theconnotationof social simplydoesnotmeanwhatwehaveinmind [Interview5].Evenwhere the term CSR is used, it can be filled with different content, depending on the individual company,accordingtothestatementgivenbyoneoftheconsultants[interview1]. As some consultants point out, the term CSR also raises negative associations on the part of companies: The term CSR has a number of disadvantages, one of them being that it always soundsabitlike:let sdirectsomeofourprofitsintosocialsponsoring [Interview6].Therefore,all surveyedconsultantstrytodispelanyimpressiononthepartoftheircustomersthatcsrlacks economic benefit. The basic understanding that, at the end of the day, CSR also has to pay off economicallyforthecompanyishenceseenasapreconditionoftheconsultingprocess.csris deliberatelyemphasisedasan economicfactor inordertoraisethecompanies interestincsr, for: Values also need to have a value for the company [Interview 5]. From this expectation, however, a major difficulty results for the consulting activity. Since CSR is seen as a very soft issue [Interview5],thequestionariseshowthesuccessofCSRistobeassessedforthecompany. Success measurement turns into a major problem for the consulting process: as it does not haveadirectimpactonthebalancesheet,exceptperhapsasacostfactor [Interview4].Insofar, theconsultingprocessaimsatemphasisingthelongdtermadvantagesofcsr: Tomakesuccessin termsofcsrmeasurable,parametershavetobereassessed,i.e.theyhavetopursuemediumdto longdtermeffectsandnotfocusonquarterlyfigures [Interview1]. TopropagateCSRactivities,theconsultantspointtosocialchange,whichtheconsultedcompany should respond to in an appropriate way. Beside the general advice that companies gain a competitive advantage through CSR, they particularly address the aspect of globalisation. They makeclearthatithasbecomeindispensableforcompaniestoreacttoglobalisationbymaking increaseduseofcsr,asglobalisationhasledtoachangeinconsumerattitudes: whatmany peoplenoticeinthisenvironmentisthatconsumerscertainlytendtobuyproductswithaclean background [Interview 5]. Another particularly important aspect is to highlight the dynamic of social change in order to substantiate the need for immediate action: We ( ) are interested aboveallinpointingoutthat,themoreurgentsocialproblemsare,themoreurgentalsoisthe demandforasolution [Interview6].Intheconsultingprocess,itisthereforealsomadeclearthat, in the meantime, many companies have become involved in this area because the inhibition threshold canbeloweredbythismeans [Interview3]. 6
8 DiscussionPaper2011/2 However,theconsultantsoftenhavetodowithdecisionDmakersintheconsultingtalkswhoare only prepared for minor commitment to the field of CSR. As a result, the consulting process is maderatherdifficult, asoneoftenneedstoexplainthatcsrismorethanjustmarketingand PR. It is not only about a CSR rating report, which you have to compile and publish, it is really aboutimplementingsomething [Interview3].Accordingtotheconsultants,however,itisoften possiblealsointhesecasestoconvincethecompanythataprimaryfocusonprmeasuresmight producemoredamagethanbenefit: Theytendtoberathergratefulthatoneshowsthemonce againinaveryspecificwaywhatcouldhappen [Interview1].Inthiscontext,negativeexamples fromthepastcanserveasasupportingargument: Ifsomeonecomesuptomorrowandclaims that(nameofthecompany)isproducinginindiawithchildlabour,theywillveryquicklynoticethe declineoftheirsales [Interview5]. Once a customer relationship has been established, the consulting firms work with modular consultingproducts,asisalsothecaseonotherconsultingoccasions.inthisway,theconsulting processisprovidedwithastructure.whatresultsisacertainstandardisation,whichinpractice however is still adjusted to the respective individual circumstances: Of course, there are basic elementswhichalwayscomein.butnocompanyislikeanyother, anditisprettydifficulttosay: let sdo1,2,3,4,andthereyouhaveyourcsr [Interview3]. Atpresent,theCSRconsultingmarketisstilldominatedmostlybyspecialisedconsultancyfirms, which have often focused on a partial aspect or on certain lines of industry. Primarily, these specialisations result from the consultancy firms further consulting services. Due to increased media attention, however, other actors have now also entered the market, the focal issue of whichisnotcsr,butwhohaveextendedtheirportfoliointhisdirection: Basically,wearejust abouttoleavethephasewherecsrconsultingwasapredilectionofsmallspecialists.now,the largeagenciesareincreasinglyenteringthemarketwithdifferentlevelsofquality [Interview1]. Accordingtothesurveyedconsultants,communicationandPRagenciesincreasinglygetinvolved inthecsrsegmentandputthefocusespeciallyoncommunications,truetothemotto: Ican reportoneverythingthecompanydoes,soofcourseicanalsoreportoncsr [Interview4]. Consequently,theconsultantsalsodifferintheirassessmentastowhetherCSRwillberelevant overthelongterm.whereasonesurveyedpersonsaidwithdetermination: Itisnotafashionable issue [Interview2],anotherconsultantpointsoutthathisconsultingcompanyhasdeliberately notsetupaspecialisedcsrunit,ascsrwasonlya luxuryissue andwouldinevitablybecome lessrelevantinacoupleofyears. 4.(CONCLUSION( Over the past years, companies have increasingly occupied themselves with their social responsibilityandreflectedtheconsequencesoftheirentrepreneurialactingfortheirreputation andpublicimage.inthiscontext,oneoftenreferstocorporatesocialresponsibility,atermalso pickedupbytheconsultingcompaniesofferingspecialisedconsultancyinthissegment.against 7
9 DiscussionPaper2011/2 thisbackdrop,thearticlehasdealtwiththequestionofwhichrolecorporateconsultingfirmsplay forthedisseminationofcsractivities.dotheconsultingfirmswishtomakeactivecontributions to the establishment of CSR practices as a new management trend? Do they rather restrict themselvestotheroleofdiffusionagentsforpractices,whicharealreadyassertedthemselvesin theorganisationalfieldofthecompaniesseekingconsultancyordotheyconsiderthemselvesto berelativelyinsignificantactorsintheprocessofincreaseddisseminationofsociallyresponsible practices? Fromthesurveyedpersons pointofview,csrhasnotbeenablesofartofirmlyestablishitselfas a consulting subject. The interviews indicate that the customers of consulting firms often have been convinced of the issue s relevance. This fact militates against the interpretation that an unchallengedgeneralnotionofcsrhasalreadydevelopedinanorganisationalfield.accordingto theirownstatements,theconsultingfirmsoftenmakeastrongefforttoawakentheinterestof customercompaniesintheissue.thestrategytomakecompaniesfamiliarwiththesubjectofcsr by means of participation in conferences, workshops and lectures is considered as far more promising than the direct approach of customers. The common perception of the surveyed personsisthatknowledgeaboutcsrisverylowonthepartofpotentialcustomers.therefore,the consultants predominantly see themselves as playing an active role. It is they who prepare the groundfortheissueanddeliberatelytakeupandreinforcethetrends.hence,theselfdperception oftheconsultantsisfarmoreinlinewiththeinterpretationofmanagementsociologythanwith thepictureofneodinstitutionalistorganisationalresearch.accordingtothestatementsmadeby theconsultants,csrconsultingserviceshavenotreachedthestandardisationleveleitherthatis characteristicofotherconsultingservices.csrconsultingisoftentailoredspecificallytotheneeds ofcustomercompanies,andtheconsultingfirmsthemselvesdonotbasetheiractivitieseitheron aconsistentbasicunderstandingofcsr.withconcern,however,smallspecialisedconsultingfirms observe that, in the meantime, the large consulting companies have also begun to offer CSR advisory services. Insofar, a possible step towards the institutionalisation of CSR becomes apparentintheinterviews.fromtheconsultants pointofview,however,thisalsoindicatesthat, inthefuture,thefocusofcsrwillbeshiftedabovealltotheaspectofcommunicationsandpr. REFERENCES( Aras, G., & Crowther, D Corporate sustainability reporting: A study in disingenuity? Journal( of( Business(Ethics,87(1):279D288. Ballou, B., Heitger, D., & Landes, C The future of corporate sustainability reporting. Journal( of( Accountancy,202(6): Bluhm, K Corporate Social Responsibility Zur Moralisierung von Unternehmen aus soziologischer Perspektive.InA.Maurer&U.Schimank(Eds.)Die$Gesellschaft$der$Unternehmen$ $Die$Unternehmen$ der$gesellschaft:144d162.wiesbaden:vsverlagfürsozialwissenschaften. 8
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Corporate Social Responsibility Seminar
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