European Commission Green Paper on CSR
In every edition of the Corporate Social Responsibility, Sustainability and Corporate Reputation Specialist course I am asked, sooner or later, a question: Is corporate social responsibility a necessity or a luxury?
The question could not be more accurate, if luxury is understood as everything that is not strictly required by the applicable legal system. On a high percentage of occasions, the debate focuses on the competitive advantages generated by the good image of a company with a strong corporate social responsibility (CSR) policy, concluding that, in addition to the obvious benefits for society and the environment, CSR is a tool for accessing new business niches in which the client has a high level of demand in terms of sustainability.
Well, we have recently read in the specialized press that BBVA will mobilize 100,000 million euros by 2025 in green and sustainable financing, and they have gone even further by announcing that they will stop financing projects linked to the use of coal in order to reduce their exposure to this fossil fuel, committing themselves to ensuring that 70% of the energy contracted by BBVA will be renewable by 2025.
Order EYH/1286/2021, dated October 26, has recently been published, approving the regulatory bases for subsidies aimed at implementing corporate social responsibility in SMEs in Castilla y León.
According to the regulatory bases, the purpose of these subsidies is to facilitate the financing of projects aimed at implementing Corporate Social Responsibility (CSR) in the SMEs of Castilla y León.
The subsidies will be granted on a non-competitive basis, and will be awarded once the project has been executed, until the available budget has been exhausted.
Eligible expenses are those derived from the external consultancy necessary to obtain the certification, verification or validation, carried out between the publication of this order and the application for the subsidy, which have already been paid.
The subsidy will consist of 65% of the eligible cost. This percentage will reach 70% in the case of work centers located in a municipality of less than 10,000 inhabitants, or 3,000 if it is less than 30 km from the provincial capital. In the case of mining municipalities, it may reach 75%.
The company is considering a recommendation from the expert group on sustainable finance for the establishment of official standards for bond issues.
Much appreciated for the accurate comment. Totally agree. This is what I will discuss in more detail in Part Three on the potential for greenwashing.In effect the verifications and any certifications, are to process and consistency with the Principles and the performance reports are on whether the projects met the criteria they said they would meet, not whether they were green or not, and this with a “limited assurance”, casual observation of information provided by the company. And this is where the key is: what is the impact of the investments? And this will depend on the rigor with which each company wants to face it. And here we will have to differentiate between large projects, say wind energy, and loans to SMEs, some will be more verifiable than others, some will be impactful, others will be pure greenwashing.Again, thanks a thousand times for the comment. I will now try to make the third part even clearer on this.
Corporate Social Responsibility means that the company voluntarily adds social and environmental objectives to its business operations, production processes and relations with different stakeholders, integrating them into its strategy.
Being socially responsible does not only mean complying with obligations in these areas, but also going further, investing in human capital and in relations with the environment and society in which the company operates.
For most SMEs, Corporate Social Responsibility (CSR) continues to be an unknown, distant and out-of-reach topic, considered a luxury reserved for large companies, since it is assumed that they have sufficient human and economic resources for the development and implementation of a socially responsible management model.
Another major obstacle for SMEs is the approach to CSR as a purely “fashionable” issue, rather than as a factor of competitiveness, important for the long-term health of the brand and the business model.