Examensarbete i Hållbar Utveckling 101

Corporate Social Responsibility in Spain: veni, vidi, vici?

Corporate Social Responsibility in Spain: veni, vidi, vici?

Javier Navas Martínez

Javier Navas Martínez

Uppsala University, Department of Earth SciencesMaster Thesis E, in Sustainable Development, 30 creditsPrinted at Department of Earth Sciences,Geotryckeriet, Uppsala University, Uppsala, 2012.

Master’s ThesisE, 30 credits

Supervisor: Belén López VázquezEvaluator: Gloria Gallardo

Examensarbete i Hållbar Utveckling 101

Corporate Social Responsibility in Spain: veni, vidi, vici?

Javier Navas Martínez

 

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Content

1. Introduction ................................................................................................................................... 5 1.1. Aim of the study ....................................................................................................................... 5 1.2. Motivation ................................................................................................................................ 5

2. Theoretical framework ................................................................................................................. 6 2.1. Background: brief story of CSR ............................................................................................... 6 2.2. CSR and Sustainability: a win-win case? ................................................................................. 7 2.3. CSR theories ............................................................................................................................. 8 2.4. Accountability: CSR reporting ............................................................................................... 10 2.5. Tracking sustainability performance: Dow Jones Sustainability Index (DJSI) ...................... 13 2.6. Corporate Social Responsibility and sustainability. The Multinationals Case ....................... 15

3. Methodology ................................................................................................................................ 18 3.1. Sample .................................................................................................................................... 18 3.2. Data collection and indicators selection ................................................................................. 19 3.3. Indicators assessment ............................................................................................................. 22

4. Results .......................................................................................................................................... 23 4.1. Reporting features .................................................................................................................. 23 4.2. Sustainability governance ...................................................................................................... 24 4.3. Information disclosure analysis .............................................................................................. 25

5. Discussion ..................................................................................................................................... 30 5.1. Reporting features .................................................................................................................. 30 5.2. Sustainability governance ...................................................................................................... 31 5.3. Information disclosure analysis .............................................................................................. 32

6. Conclusions .................................................................................................................................. 34 7. References .................................................................................................................................... 36

Online references .......................................................................................................................... 40 Companies CSR websites.............................................................................................................. 41 Commonly used abbreviations in the document ........................................................................... 41

Acknowledgements .......................................................................................................................... 42

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Corporate Social Responsibility in Spain: veni, vidi, vici? JAVIER NAVAS MARTÍNEZ Navas Martínez, J., 2012: Corporate Social Responsibility in Spain: veni, vidi, vici? Master thesis in Sustainable Development at Uppsala University, No. 101, 43 pp, 30 ECTS/hp

Abstract: Corporate Social Responsibility (CSR) has been gaining momentum and nowadays is becoming a recognized concept, as a facilitator for increasing environmental and social awareness.

This paper aims to examine the sustainability and CSR scenario in Spanish Multinational Companies that are eligible for the international benchmark Dow Jones Sustainability Index (DJSI). A content analysis of economic, social and environmental indicators was carried out for 20 of these companies, for the information reported during 2011.

The indicators were analyzed and represented attending to the disclosure of information, measurement of the indicators disclosed, established goals and communication to external and internal stakeholders.

The results showed companies have been reporting non-financial information since 2003-2004 in average, most of them seek external assurance of the reported information and the highest part of the analyzed companies rely upon the Global Reporting Initiative (GRI) to carry out their reporting efforts.

There is still much room for debate in the issue, but as of today it is clear that CSR is becoming an increasingly relevant issue for companies and international benchmarks are gaining reliability as measurement tools.

Keywords: Sustainable Development, Corporate Social Responsibility, Corporate Reporting, Spanish Multinational Company, sustainability Javier Navas Martínez Department of Earth Sciences, Uppsala University, Villavägen 16, SE- 752 36 Uppsala, Sweden

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Corporate Social Responsibility in Spain: veni, vidi, vici? JAVIER NAVAS MARTÍNEZ Navas Martínez, J., 2012: Corporate Social Responsibility in Spain: veni, vidi, vici? Master thesis in Sustainable Development at Uppsala University, No. 101, 43 pp, 30 ECTS/hp

Summary: Corporate Social Responsibility (CSR) is nowadays a common term used in sustainable development debate and business alike.

This paper aims to examine the sustainability and CSR scenario in 20 Spanish Multinational Companies. More specifically, economic, social and environmental indicators were evaluated.

The analysis took into account the information provided by the companies in 2011, the quantitative indicators disclosed, as well as the published goals and communication with internal and external stakeholders. The indicators were chosen according to an international benchmark called Dow Jones Sustainability Index (DJSI), which evaluates annually the sustainability performance of the biggest Multinational Companies according to their capitalization.

The results revealed that the selected Spanish companies have been reporting information related to sustainability indicators since 2003-2004 in average, most of them seek an independent third-party assurance before publishing this information, and the highest part of the analyzed companies rely upon an acknowledged international initiative in sustainability reporting called Global Reporting Initiative (GRI)

There is still much room for debate in the issue, but as of today it is clear that CSR is becoming an increasingly relevant issue for companies in Spain and international benchmarks are pushing companies to improve their performance and communication in sustainability issues.

Keywords: Sustainable Development, Corporate Social Responsibility, Corporate Reporting, Spanish Multinational Company, sustainability Javier Navas Martínez Department of Earth Sciences, Uppsala University, Villavägen 16, SE- 752 36 Uppsala, Sweden

 

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1. Introduction Is it possible to reach equilibrium among society, the environment and the economy? Multinational companies (MNCs), increasingly regarded as corporate citizens, register enormous social and environmental impacts associated with their activities. They are in the bull’s eye and often depicted as unconscious and selfish organizations seeking profit regardless of the cost. On the other hand, these actors provide societies with necessary products and services, creating jobs and investing money in the communities they operate in, among others. So, where’s the catch? Is there really a way to determine if companies are having an overall positive or negative effect on society and the environment? Theoretically, MNCs´ are oriented towards minimizing negative impacts while maximizing the positive effects. In this regard, companies often arrange these actions under the umbrella of corporate social responsibility. CSR and sustainability reporting are already institutionalized within multinational companies, which use reporting as platform for stakeholder engagement and disclosure of performance. The disclosure of this information facilitates the assessment in their respective CSR efforts. One of the most rigorous and accepted benchmarking tools is the Dow Jones Sustainability Index. It is possible then to conclude that sustainability in companies is no longer in a preliminary stage –is it necessary?- but rather, in a how can I do it?- stage, where sustainability is increasingly being regarded as a competitive advantage for many companies. Still, there are many unresolved questions in this context that we may not find answers for. Perhaps there is no black, nor white answer. The grayscale in between provides a fertile field for discussion and interpretation of the role MNCs play in our current societies, and the advancement of sustainability as global (and necessary) goal. On a related note, we are currently demanding information of these companies, but, do we know how to use it? Are we conscious of the efforts these companies do? Moreover, are we conscious and concerned citizens? This research aims to shed some light into basic CSR and sustainability features of MNCs, taking Spain as a case study, bringing more information into the CSR and sustainability area. After all, it’s often said information is power. Simultaneously, great power brings great responsibilities (thanks for that valuable piece of advice, Mr. Parker! I’d never thought I may use it in an academic paper.) 1.1. Aim of the study This research aims to review the current Corporate Social Responsibility and Sustainability scenarios and trends for Spanish Multinational Companies. More specifically, the purposes of the study are:

• Review the different strategies and approaches of the companies in Corporate Social Responsibility. • Analyze reporting practices and rank the companies according to the disclosed information. • Contribute to the ongoing debate in CSR and stimulate future research in the issue.

1.2. Motivation Recent studies such as KPMG Corporate Responsibility Survey 2011 point out Spain as an increasingly relevant market regarding Corporate Responsibility. This fact is supported by the inclusion of 20 companies in the last edition of the Dow Jones Sustainability Index.

Besides, the Spanish sector has been claiming international attention lately due to the exacerbated economic crisis, international crisis such as Repsol and Red Eléctrica Española’s expropriations by Argentinean and Bolivian governments, and intervention of financial institutions such as Bankia.

It is quite a delicate moment for the Spanish economy. Thus, it is interesting to approach how Spanish leading companies behave, bringing insight to managers, and raising interest for the general audience.

All the selected 20 companies are among the largest companies of the country and are listed on the Madrid Stock Exchange -IBEX35-. Additionally, they are important international actors operating in a wide range of countries.

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2. Theoretical framework 2.1. Background: brief story of CSR There is no generally accepted definition of CSR since there is an ongoing debate about the role businesses play within the community and the related responsibilities commonly denominated CSR (Whitehouse 2006). An updated definition of CSR has been brought forth by the European Commission in 2011:

“CSR is the responsibility of enterprises for their impacts on society. Respect for applicable legislation, and for collective agreements between social partners, is a prerequisite for meeting that responsibility. To fully meet their corporate social responsibility, enterprises should have in place a process to integrate social, environmental, ethical, human rights and consumer concerns into their business operations and core strategy in close collaboration with their stakeholders”

It is well documented throughout literature the journey that Corporate Social Responsibility (CSR) has endured on its way to recognition, being often deemed contradictory and useless by many as far as until the 1970s (Lydenberg, 2005).

1950

An updated definition of CSR has been brought forth by the European Commission in 2011

Howard Bowen’s Social Responsibility of the Businessman publication stated the need for the top management for an involvement in a service to society

Milton Friedman expressed an opposition to the idea of CSR, stating that it was unfair and costly towards the shareholders. Corporate Social Responsibility was mentioned in less than half of the Fortune 500 companies’ annual reports

Almost 90% of the Fortune 500 firms deemed CSR as an essential element in their organization

95% of the 250 largest companies in the world (G250 companies) report on their corporate responsibility activities. companies have progressively undertaken responsibilities beyond their own economic activities and began considering non-financial aspects in their management

1970 1990 2010

Figure 1. Timeline of Corporate Social Responsibility. Source: self-elaboration

We can trace the beginning of CSR as an emerging concept back to the 1950s, when the first scholars began publishing research related to the role of business in societies. More specifically, Howard Bowen’s Social Responsibility of the Businessman publication in 1953 is often cited as a milestone, as it stated the need for the top management for an involvement in a service to society (rather than solely in the interest of shareholders) (Garriga & Melé, 2004) During the 1990s CSR continued gaining momentum, as international organizations (such as the World Bank, the United Nations or the International Labor Organization), consumers, governments and corporations began to endorse the idea of CSR. By then, many definitions of CSR were proposed, mainly related to the moral nature of the issue and shaping the idea of a social responsibility and obligations to society. In these first stages, the capabilities of the enterprises to respond to social pressures were assessed. High profile economists such as Milton Friedman expressed an opposition to the idea of CSR, stating that it was unfair and costly towards the shareholders (Friedman 1962, 1972). Additionally, mid-level managers perceived CSR as an imposed cost with unclear outcomes. Hence, corporations were set to oppose CSR implementation in corporations (Klepper & Mackler 1986). Thus, around the 1970s, Corporate Social Responsibility was mentioned in less than half of the Fortune 500 companies’ annual reports. By the end of the 1990s, however, we witnessed a remarking increase, where almost 90% of the Fortune 500 firms deemed CSR as an essential element in their organization (Boli & Hartsuiker, 2001). Additionally, Esrock and Leichty (1998) analyzed a random sample of Fortune 500

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companies and found out that around 90% of the companies relied upon Web pages as corporate communication platforms and 82% of the sites dealt with, at least, one CSR issue. Nowadays, 95% of the 250 largest companies in the world (G250 companies) report on their corporate responsibility activities. European countries are still leading in this field, with 71 percent of companies reporting on CR issues. However, the Americas and Asian countries are closing the gap quick enough (KPMG survey in Corporate Reporting, 2011). During the last decade, companies have progressively undertaken responsibilities beyond their own economic activities and began considering non-financial aspects in their management (Capriotti, 1999; Carroll, 1999; Waddock, 2004). In addition to the appearance of different trends within the CSR, authors such as Wartick & Cochran (1985), Wood (1991), and Waddock (2004) suggest the existence of a gradual evolution in the conception of company responsibilities. Besides, businesses are increasingly becoming more globalized and facing bigger and more complex market opportunities (Carroll, 2004). The extensive growth of multinational companies is contributing to a growing demand for CSR and innovative solutions. Global problems such as poverty, water and food shortages, pollution, human rights violation, unemployment and defected education must be tackled in a global approach (Zadek, 2001). Nowadays, the reality most business face is quite complex and solutions to global issues must involve economic, social, political, ethical, legal and environmental concerns. These problems present challenges to many actors such as government, society and business (Zadek, 2001). Evidence suggests that some individuals are willing to pay more for so called socially responsible goods (Jensen et al., 2002). Thus, this expressed preference by these ‘conscious individuals’ could theoretically, have consequences for companies that do not take on CSR activities (Heinkel et al., 2001) and some of these firms might be forced to adopt more socially responsible practices. 2.2. CSR and Sustainability: a win-win case? The terms sustainability and sustainable development have gained momentum and been debated over some time now. It can be said that the journey began with the publishing of the Report of the World Commission on Environment and Development (1987) and followed by Agenda 21 (1992) in the Rio Conference context. From that milestone on, several initiatives have been developed over the years (Mayor, 1998). Historically, there appears to be an apparent trade-off between “business as usual” and environmental protection. According to the role of socially responsible companies ought to play, Vanberg (2007) identified three dimensions

• “Soft”: related to how socially responsible corporations should play the market game within existing rules.

• “Hard”: concerned with how the rules of the market ought to be changed in order to induce “socially responsible” corporate behavior.

• “Radical”: rejecting the compatibility of CSR and market incentives and calls for the adoption of some alternative economic regime.

The convergence in these dimensions is the lack of faith in the capacity of free market to generate wealth in an equitable and sustainable fashion. CSR advocates typically argue that an enterprise has more stakeholders than shareholders, and that existing market institutions do not spontaneously incorporate the interest of stakeholders in their everyday decisions. The predominant importance of environmental issues in the CSR literature is documented by Lockett et al. (2006), among others. The place where sustainable development and CSR meet is the “triple bottom line” concept (Elkinton, 1998), where sustainability is explained as the sum of financial, social and environmental grounds. It is often argued that this triple bottom concept reflects stakeholder expectations and firms that do not meet these are prone to see their reputation damaged with a negative impact on market shares and profitability (McIntosh et al, 1998).

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Among the benefits obtained from implementing sustainable practices, we mainly find: lower compliance costs, new “green technology” market opportunities, increased bargaining power for government subsidies, better employee motivation and recruiting opportunities, preferential treatment from customers and investors and improved risk management (Wagner & Schaltegger, 2003; Hay et al., 2005; Porter & Kramer, 2006). Besides, it is often argued that an organization’s long-term profitability is best pursued if aligned with social and environmental goals (Hart & Milstein, 2003). On the other hand, resources are limited, while human needs and population are growing in an exponential fashion (Meadows et al., 1972). This very fact is enhancing a predominant short-term perspective to fulfill necessities, in which production costs can be reduced and/or profitability increased through overexploitation of natural resources and polluting emissions that are not properly factored into the costs of production (Hawken et al., 1999).

Figure 2. Triple-bottom line structure. Source: self-elaboration based on Elkinton, 1998

Another interesting research focus is the one proposed by Porter & Kramer. They argue that “the principle of shared value involves creating economic value in a way that also creates value for society by addressing its needs and challenges”. These authors express the necessity to move beyond trade-offs. Society’s needs are large and growing, and they propose capitalism to be reshaped to legitimize businesses towards sustainability and long-term value (Porter & Kramer, 2011). In a way, it seems that corporate responsibility programs so far have typically been promoted to improve firms’ image rather than creating a benefit at large in society.

2.3. CSR theories This section aims to give the reader a general overview of the most acknowledged and cited CSR theories, in order to provide a theoretical framework. Companies are often confronted with a dilemma: adopting an egoistic approach to create opportunities to maximize profits in the short term and attract investors, or envision the firm’s focus on CSR according to its reputation and brand image (Becker-Olson et al., 2006). One of the most accepted theories concerning Corporate Social Responsibility is Carroll’s four part pyramid of CSR (Keinert, 2008). Carroll considers CSR as a concept involving different dimensions, related to different responsibilities and expectations, and it is usually represented in the shape of a pyramid (Henningfeld et al. 2006). According to Garriga and Mele (2004), there are 4 groups of CSR theories: instrumental theories, political, integrative and ethical.

Desired by society

Expected by society

Required by society

Required by society

Economic responsibility

Legal responsibility

Ethical responsibility

Philantropic responsibility

Figure 3. Representation of Carroll’s Four-Part pyramid of CSR (Henningfeld et. al. 2006)

Triple P bottom line

People Planet Profit

Concerning the effects for the human beings

Related to the effects on the natural environment

Referred to the creation of value through products and services, employment and income

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For the proposed scope of this study, there are 3 different types of CSR considered: ethical, economic and strategic.

2.3.1. Ethical CSR The ethical perspective of CSR relies upon the moral arguments inherent to the role of business towards society. This approach is focused on the ethical requirements that strengthen the relationship between business and society (Garriga & Melé, 2004). Henderson (2001) states that ethical CSR poses a positive and broad perspective and it is capable of identifying opportunities for businesses to contribute to both the wellbeing of society and the integrity of the natural environment. It is often argued that this approach disregards the interests of business. However, this theory emphasizes a reassessment of interests in a longer perspective. Nowadays, corporations have a leading role in society and it is through the notion of corporate citizenship that they can channel their efforts towards contributing to a greater balance between profit and ethics. The managerial approaches towards problem solving lie within the awareness of the ethical consequences of an action as well as its estimated profitability (Reidenbach & Robin, 1991). 2.3.2. Economic CSR The economic approach is traditional and has enjoyed wide acceptance in business. Windsor (2001) has pointed out that: “a motive of wealth creation progressively dominates the managerial conception of responsibility”. Maximizing shareholder value is the goal of the activities of the company and leads to a short-term profit orientation (Garriga & Melé, 2004). In this context, firm’s actions are focused on increasing shareholder value, which is the benchmark for the company’s decision making. Therefore, every investment aligned with this premise is accepted unless it poses uniquely a cost on the company. Henderson argues that this approach represents a restricted business focus since the CSR actions are not undertaking regarding society’s improvement, but as result of the market situation. In this context, Porter and Kramer (2002) argue that philanthropic activities may be the only way to improve the context of competitive advantages of a firm and usually creates greater social value than individual donors or government can. In contrast to Friedman’s view, they argue that the firm has the knowledge and resources for a better understanding of how to get to the bottom of effort related to its actions. 2.3.3. Strategic CSR As of today, Bansal (2005) argues that the dichotomy posed by ethics and economy hinders the convergence of these two aspects, wherein real opportunities lie for creating intrinsic value for a company and society: Can CSR bring favorable economic results through ethical performance? Nowadays, CSR is presented as a requirement in the highly competitive market. There are several factors that have contributed to this shift that can be summarized in the chart below.

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CSR

Increased welfare International organizations

Transparency Environmental awareness

The increased welfare in developed countries has shifted stakeholders’ preoccupation towards “higher” aspects in the so-called “necessities pyramid”Nowadays, the supply and demand equilibrium has shifted towards demand

International organizations have undertaken an active role in promoting responsibility beyond economic aspects.In 2000, UN launched the Global Compact Initiative, as a paramount of the efforts of companies concerning Human Rights, transparency and labor relations

The current society of information has actively encouraged a more transparent world, wherein information is easily and quickly transmitted and all the organizations are placed under a higher scrutiny, which show a direct impact on investment decisions

There is a growing concern towards the environment, specially towards natural resources limits, global warming effects, as conditionings for growth and development

Figure 4. Shift towards CSR.factors. Source: self-elaboration based on Garrigues and Trullenque, 2008

In this context, Garrigues and Trullenque (2008) establish 3 differentiated stages in CSR within a company:

Stage I: disintegrated

Stage II: communicative

Stage III:strategic

• Non-coordinated initiatives

• Lacks global vision

• Globally coordinated

• Focused on communication

• Strategically integrated to generate competitive advantages

• Business-oriented communication

• Positive synergies business/society

Figure 5. Stages in CSR Source: self-elaboration based on Garrigues and Trullenque, 2008

According to Porter and Kramer, strategic CSR is the highest maturity phase an organization can achieve, where the ultimate goal is value creation (Porter & Kramer, 2011). Burke & Logsdon (1996) argued that when philanthropic activities are closer to the company’s actions, they create greater wealth than traditional forms of donations such as monetary contributions.

2.4. Accountability: CSR reporting Corporate Responsibility has been shown to be growingly valued and rated by different groups of stakeholders throughout several studies (MORI, 2004; PriceWaterhouseCoopers, 2005; KPMG 2011). The information reached by stakeholders is based on the stated commitments of an organization. Its relationship with its different kinds of actors lies in the fulfillment of its economic, social, environmental and ethical commitments, as well as in the development of its products, services, and business. To do so, the organizations rely on communication at the heart of CSR/CC/SD management (Waddock, 2004). CSR strategies are deemed correctly by stakeholders as long as they are clearly perceived to create social and environmental value. In this context, independent benchmarks have been proposed as a mechanism to improve comparability among the CSR efforts of companies (Graafland, 2002).

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Accountability is a mean for society to evaluate a company’s performance over time, promoting a transparent comparability among companies (Graafland et al. 2004). In this regard, Whitehouse (2006) emphasizes the challenge of translating corporate values in a day-to-day basis, within strategies and decision-making. Nowadays, there are several communication tools for disclosing CSR information: dedicated websites, corporate communications, social media, Sustainability Report, intranet, advertising, etc. Internet has become a key tool for organizational communication where stakeholders can gather information from different perspectives about the organization, and the degree of public scrutiny is increasingly higher (Esrock & Leichty 1998; 2000. Kent et al. 2003). However, some critical opinions such as Doane’s (2004), argue that sustainability reporting is not itself a guarantee that the company is carrying out sustainable activities. Furthermore, international efforts such as the Global Reporting Initiative (discussed below in 2.4.2) are providing mechanisms that are striving to ensure reliability of the information disclosed by the companies. 2.4.1. The importance of reporting One crucial aspect for companies to deal with is the relationship with stakeholders and society at large, compelling companies to answering justified questions, being transparent, and seeking different means of collaboration with stakeholders. In this sense, it is argued that consumers may also punish organizations that are perceived as dishonest in their social and environmental involvement (Sen & Bhattacharya, 2001). Additionally, an organization that is not sensitive to changes in the environment where operates and cannot adapt to those developments will eventually lose momentum. It is paramount for any company to monitor trends and take action to adapt the organization to those new trends (De Geus, 1997). Sustainable development will become a reality uniquely throughout innovation and development of technology. It is thus, paramount to have a widespread access to knowledge and information, investing in education, formation and technology (Club de Roma, 2002). Besides, it constitutes one of the Millennium Development Goals. The progressive constitution of an increasingly interconnected knowledge society in the years to come is causing an important change in the industrial models and can be both a part of the problem and the solution. It is argued that if managed properly, the development of the information technologies and communication can contribute to generating global wealth and reducing poverty. However, it is important to highlight that these tools are not reverting the situation themselves, but acting as facilitators to integrate people in impoverished countries, improve access to basic services, education, health. Internet represents numerous opportunities to enhance interactivity between society and organizations. Several studies have drawn attention to it and proposed two basic features to take into account (Esrock & Leichty, 1998, 2000; Schultz, 2000; Taylor et al. 2001):

• The dissemination of information, where the degree of interactivity is low, and the use of internet is unidirectional.

• Generation of relationships between the different stakeholders and organization, where internet is used to allow dialogue and interactions.

The theory of creating shared value proposes collaboration and partner enlisting as a way of sharing costs and form successful clusters, developing collaboration within the private sector, trade associations, government agencies and NGO’s (Porter & Kramer, 2011), where social media can have a role as mortar, cementing these relations. 2.4.2. Global Reporting Initiative The Global Reporting Initiative (GRI) is a non-profit organization that works for a sustainable global economy by providing a reliable guidance in sustainability reporting. GRI has been one of the first widespread initiatives to develop a comprehensive Sustainability Reporting Framework. This framework

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enables organizations to measure and report their economic, environmental, social and governance performance. This aforementioned framework includes Reporting guidelines, Sector Guidelines and other Resources, which are designed to promote organizational transparency and accountability, leading to further benefits for the organization and its stakeholders. Furthermore, GRI also has established strategic partnerships with the United Nations Environment Programme, the UN Global Compact, the Organization for Economic Co-operation and Development, International Organization for Standardization among others. The Global Reporting Initiative has set 3 different disclosure levels for companies, depending on the amount of information they report:

• The level “A” can be awarded when a corporation reports on all indicators of the G3 Initiative of the Global Reporting Initiative G3 and of the relevant Sector Supplement, and when it includes a statement on its management approach to each indicator category.

• The level “B” recognises organizations that report on a minimum of 20 indicators plus on their management approaches for the different indicator categories.

• The level “C” indicates that a report covers at least 10 indicators, but not necessarily a statement on a corporation’s management approaches.

As it has been reported in many academic references, in terms of relevance, the GRI is commonly regarded as the world’s leading voluntary scheme for corporate non-financial reporting. 2.4.3. Integrated reporting The International Integrated Reporting Committee (IIRC) has reunited different actors from the corporate, investment, accounting, securities, regulatory, academic, civil society and standard-setting sectors to promote a new approach to reporting. This new approach emphasizes the necessity of including sustainability as a material issue for an organization. In this scenario, sustainability is understood as an element that is intertwined with strategy and performance. Additionally, this new approach aims to reflect in a clearer way how a company operates and creates value. Furthermore, it is stated by the IICC that “the challenge facing organizations to create and sustain value in the short, medium and longer term. Each element of an Integrated Report should provide insights into an organization’s current and future performance”

By addressing the material issues for an organization, an Integrated Report should demonstrate in a clear and concise manner an organization’s ability to create and sustain value in the short, medium and longer term. The development of Integrated Reporting is designed to enhance and consolidate existing reporting practices. Through collaboration, consultation and experimentation, the IIRC plans to move towards a reporting framework that provides the information needed to assess organizational value in the 21st century. 2.4.4. Reporting assurance: the role of third party evaluation Third party assurance began in 1990 with the aim of enhancing the validity of the information disclosed by companies. According to Park and Bronson (2005), some of the aspects covered by this information review include:

• Completeness of the report • Accuracy of the figures and quantitative information • Analysis of the data provided • Bring future improvements

The external evaluation of sustainability disclosed information has gradually been implemented. In 2003, it is reported that 30% of the companies relied upon external assurance (ACCA, 2004), reaching 40% in 2004 (Palenberg et.al. 2006). Already in 2006, 52% of sustainability reports from a series of companies analyzed

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by KPMG were independently verified (KPMG 2006). The most recent global update on external assurance was released by KPMG in the study KPMG International Corporate Responsibility Reporting Survey (2011) and it is summarized in the following graph (1). The results shown are clearly influenced by the local regulations and markets. Countries such as South Africa, Sweden or the Netherlands are already demanding sustainability reporting, bringing increasingly higher amount of companies to have their information assured by a third party as well, pursuing a higher degree of accountability.

It is currently accepted that an evaluation by an independent third party is an exercise of accountability and transparency. It brings credibility to the organization, even though current assurance practices carry out limited verifications. The most commonly accepted and used standards for external assurance are the AA1000 Standard, developed by AccountAbility (2004), and ISAE 3000 developed by the International Auditing and Assurance Standards Board (2006). 2.5. Tracking sustainability performance: Dow Jones Sustainability Index (DJSI) Launched in 1999, the Dow Jones Sustainability Indexes (DJSI) are the first global indexes tracking the financial performance of the leading sustainability-driven companies worldwide. This section of the paper aims to provide a general overview of the international benchmark DJSI, the inclusion in the index and the assessment methodology. The DJSI is based on an analysis of corporate economic, environmental and social performance, assessing issues such as corporate governance, risk management, branding, climate change mitigation, supply chain standards and labor practices. The trend is to reject companies that do not operate in a sustainable and ethical manner. It includes general as well as industry specific sustainability criteria for each of the 57 sectors defined according to the Industry Classification Benchmark (ICB). The DJSI family contains one main global index, the DJSI World, and various indexes based on geographic regions such as: Europe, Nordic, North America and Asia Pacific (SustainAbility, 2011) In addition, the DJSI methodology facilitates the design, development and delivery of customized sustainability indexes; e.g. indexes covering different regions, indexes covering different segments of the leading sustainability companies, indexes covering additional exclusion criteria and indexes denominated in different currencies.

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Furthermore, in 2009, an independent expert study commissioned by UNEP presented at the World Economic Forum in Davos, highlighted SAM assessment as “the most rigorous in terms of the number of questions and depth of information requested” (DJSI KeyFacts 2010). Aside from disclosing the information, MNCs are effectively showing “sustainable solvency” through inclusion in a sustainability index (Fowler & Hope, 2007, Consolandi et al. 2008). It appears to be a real relation between financial performance and inclusion in a sustainability index. In a recent study, Robinson et. al (2011) concluded that there is evidence of a market reaction to DJSI results. The authors found a temporary loss for companies that are rejected from the DJSI. 2.5.1. DJSI: Inclusion in the index To be incorporated in the Dow Jones Sustainability Index (DJSI), companies are assessed and selected based on their long term economic, social and environmental asset management plans. Selection criteria evolve each year and companies must continue to make improvements to their long term sustainability plans in order to remain on the Index. Indexes are updated yearly and companies are monitored throughout the year. Stocks in the DJSI are selected from among the 2500 largest capitalized companies in the world. According to their sustainability practices, the top 10% are finally selected for inclusion. (SAM, 2010). The DJSI World Index currently includes 318 companies, chosen from among 2500 international companies. In order to be included in the index, companies must complete a questionnaire involving information in 3 different dimensions: economic, environmental and social. Sustainability Asset Management (SAM) is the agency auditing and ensuring compliance. Completing the questionnaire is a thorough exercise designed to gather information related to governance, industry-specific information, and sustainability performance. Additionally, these answers can be supported by third-party documents and references from the company’s website. Furthermore, the questionnaire is updated on an annual basis and up to 25% of the questions may change (Robinson et. al., 2011). 2.5.2. DJSI: corporate sustainability assessment The different eligible companies’ sustainability performance is reassessed. The methodology applies specific criteria to evaluate the risks and opportunities arising from economic, environmental and social issues. Additionally, there is a process set to monitor media and stakeholder information. Each company is evaluated on the grounds of:

• Responses to the questionnaire • Submitted documentation • Policies and reports • Publicly available information

Each company will reach a final score between 0 to 100%. Participating companies receive a rating report, where the scores of the different dimensions are disclosed. Additionally, the results are presented benchmarked against the industry average and leaders performance. Additionally, the DJSI members are reviewed on an annual basis – to keep track of particular events such as delisting, bankruptcy, merger, takeover, and other relevant situations in the corporate sustainability performance. Besides, the members of are continuously monitored for crisis situations against their principles and policies, for possible exclusion from the index, regardless of how well they performed in the yearly assessment.

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2.6. Corporate Social Responsibility and sustainability. The Multinationals Case Finally, in this last section of the theoretical framework, a general description of the role of Multinational Companies is offered. More specifically, related to their role in society, and the consequences in the triple bottom line of their operations. Multinational Companies, as corporate citizenships are big part of the society. As they carry out their activities towards their business goals they have a toll in the environment and the society. Ideally, an effective management will aim at minimizing these negative impacts and maximize the positive impacts. This is what is called sustainable management, as it will not compromise future generations’ ability to satisfy their needs (Brundtland, 1987). These companies, as corporate citizens were traditionally expected to provide employment, comply with pertinent legislation, and provide certain products and services (Idowu & Filho, 2009). However, MNCs nowadays face multiple and more complex expectations. They are now hold accountable by society for their social and environmental impacts as well (Handelman & Arnold, 1999). Legitimacy is a status inferred from the equilibrium between society’s expectations and the corporation’s values. Corporations tend to accommodate to meet the requirements posed by the communities where they develop their activities (Bansal, 2002). Aside from society’s expectations, MNCs need to take into account the context where they operate, since national governments have determined series of rules for companies to be granted licenses to operate (Hoffman et al., 2003). Companies used to have ample control upon the information fluxes. It used to be easy for a company to tackle reputational crisis. In the current information society, where information spreads easily thanks to portable devices and the world wide web. It has become almost impossible for companies to keep track of it, or control it. In this context, Will Hutton (2002) argues that companies are increasingly regarding reputation as a valuable asset, and embracing CSR as a strategic tool. This democratization of communication has empowered nongovernmental organizations to use media as a powerful vehicle for pointing out mismanagement practices (Werther & Chandler, 2005). Furthermore, research has shown that disclosure of social information can be directly related to media attention (Deegan et al. 2002). This situation thrusts an ethical response by MNCs. There are models that set an ethical approach for companies to adopt. It includes permanent monitoring of their impacts and determines which actions are tolerable (i.e. sustainable) from an ethical perspective. Svensson et al (2010) propose a continuous model based upon the following structure (figure 5). As MNcs operate globally, it can be said that CSR is a process driven by globalization. Regions nowadays face different situations and problems. MNCs, as they operate in a different arrange of locations, ought to adapt their CSR strategies to the local contexts and be aware of their role as corporate citizens. This very fact implies not lowering their own global standards when operating in local contexts, but working in that scale to help those communities achieve a higher stage of sustainability. Additionally, culture has been pointed out as one of the most relevant aspects influencing CSR and ethical decision-making (Rawwas et al., 2005). It is especially relevant in this context, the report issued by Professor John Ruggie, which provides a basis for understanding and establishing the environmental and social responsibilities of corporations. This report makes a distinction between the government’s duties with regards to citizens and the companies’ responsibilities to behave responsibly, especially in a developing scenario (Ruggie, 2008). Research and business cases show there is scope for MNCs to become active agents in the socio-economic development sphere, facilitating poverty alleviation and distributing wealth (Ite, 2004). As Tineke Lambooy (2011) points out, MNCs play a strategic part in contributing to Millenium Development Goals while developing new business opportunities.

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Sustainable Business practices (in the Marketplace and Society

Reconnection (control and adjustment)

FOUNDATION COMMUNICATION GUIDANCE OUTCOME

• Code of ethics

• Ethical audits

• Ethical performance appraisal

• Consequences for a breach of the code

• Communication of code to workers

• Information of the code to new staff

• Information to the customers

• information to suppliers

• Communication of the code to other stakeholders

• Support to whistleblowers

• Aid in strategic planning

• Ethics ombudsman

• Ethics Committee

• Ethics training

• Staff training

• Resolving ethical and sustainable dilemmas in the marketplace and society

• Assists the bottom line

• Effectiveness of the code

Figure 6. A corporate model of sustainable business practices: an ethical perspective. Svensson et al. 2010

A relevant case study in this regard is the Coca Cola case in India. In 2003, the company was accused of overexploitation of underground water and originating wastewater discharges. In result, the company’s license to operate was not renewed, under the grounds of the water being a resource of public interest (Right to Water, 2008). The Court stated that the government had a duty to “protect against excessive groundwater exploitation and the inaction of the State in this regard was tantamount to infringement of the right to life of the people guaranteed under Article 21 of the Constitution of India”. In 2008, the Kerala administration arranged a special committee to look into the case and study the affected communities. Thus, in 2010, this research body issued a report recommending holding Coca-Cola liable for 48 million dollar damages (India Resource Center, 2010). Despite the legal struggle being still unresolved, the company initiated a collaborative approach with WWF to study the water resources in order to gain a deeper understanding of the circumstances of the repercussions in the local communities, with the ultimate goal of achieving water resources preservation (Senge, 2008). This change of mindset was materialized in 2009, when the company announced a “net-zero” goal regarding water use. In this regard, it was announced an ample implementation of drip irrigation and rainwater harvesting projects. It can be concluded then, that stakeholders pressure and society’s attention on the company was effective in setting the company towards a sustainable resources management. China is also making great advancements in this field. A recent study carried out by KPMG (2011) points out that already 60% of China’s largest companies are already reporting issues related to corporate responsibility. This study also affirms that it is foreseeable that China will play a steward role in CR reporting in a few years time.

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Additionally, within this context, it must be taken into account the type of activity that the company undertakes. Those MNCs that are taking the heaviest toll in the environment, operating in sectors such as oil&gas, automobile and mining actors, are said to have developed more sophisticated policies regarding CSR and stakeholder engagement. In this regard, those companies that aim to take the lead in sustainability may benefit from this role of “good citizen”, but at the same time it is subjected to higher public scrutiny. Thus, it is a very strategic decision the position the company wants to assume regarding sustainability (Kolk & Levy, 2001). 2.6.1. Corporate Social Responsibility and sustainability. The Spanish Case Narrowing the already broad concept of corporate responsibility, this section aims to give a summarized account of the Corporate Social Responsibility trends in the Spanish context. Current research points out that Spanish companies at large show a large pool of practices related to environmental and social governance. Moreover, it is worth noting, that most of these initiatives have been undertaken on a voluntary basis (Prado-Lorenzo et al. 2008). It has been noted that there are increasing numbers of Spanish companies that are implementing sustainability within their management practices. This is resulting in an increased productivity and competitiveness. It is worth noting that the process of internationalization of the Spanish firms has unleashed sustainability as a widespread concept, since it brings these companies license to operate in other regions. It also can be noted that not until 2003 there were national organizations related to corporate responsibility. In this regard, the most relevant initiative undertaken from the Spanish Administration was the CSR White Paper, issued in 2006. It was promoted by the Spanish Parliament, including guidelines and recommendations aimed at providing a basic operational framework for regulations in CSR. Additionally, the 35 Spanish companies included on the Madrid Stock Exchange -IBEX35- are bound to produce an annual report on their annual accounts, on the basis that the financial repercussions and a growing societal demand. Some private agencies also collaborated in the advancement of CSR in Spain throughout different initiatives. Among them, it is worth highlighting the ORSC (Corporate Responsibility Observatory) and the Corporate Excellence. These serve as platforms for exchanging ideas and gradually implement corporate responsibility and reputation in the Spanish organizations. A more thorough description of the timeline and events surrounding CSR and Spanish administration can be consulted in the article “The institutionalisation of unaccountability: Loading the dice of Corporate Social Responsibility discourse” , by Archel et. al. published in 2011. Research has found reasonable proof to state that in the Spanish case the CSR is positively impacting business results. The implemented policies are enhancing better companies’ images and sales increases. However, it is often argued that despite the financial return, there is no clearly measured gain in efficiency. On a related note, the sustainability reporting in Spain has been shown to be mature. A recent study about corporate reporting led by the company KPMG (2011) portraits Spain as a leading actor in the reporting sphere, since 65% of the Top 100 Spanish companies disclose information related to CSR and sustainability.

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3. Methodology Benchmarking is a wide-extended tool for assessing sustainability. It is regarded as a practical method to developing critical areas of business. Kumar (2006) argues that is possible to seek improvements by studying peer best practices. The method used to carry out this paper relies upon review of publicly disclosed information regarding mainly non-financial matters. It has been called documentary research by authors such as Mogalahawke (2006). It is important to note that this method does not aim to evaluate the quality of the information disclosed, but to focus on which information is disclosed, and in a subsequent phase of the study, how this information is disclosed. More specifically, this research is based on a thorough review of the public sources disclosed by 20 companies in the field of CSR and sustainability (issued via internet). The analyzed MNCs publish annual reports containing its environmental, social, financial and non-financial performance. In most cases, this information is backed up by a website and complementary reports (i.e. climate change report). The steps taken in this approach were:

1. Selection of the companies (detailed in section 3.1 below)

2. Selection of the data: along three dimensions (reporting practices, CSR governance and strategy, and indicators disclosure) (detailed in section 3.2 below)

3. Analysis and assessment of the indicators (detailed in section 3.3 below)

3.1. Sample Business based research usually chooses companies according to variables such as market capitalization and gross revenues. A sample of 20 Spanish companies was chosen for the current study. These companies are the Spanish Companies included in 2011 within the Dow Jones Sustainablity Index. All the selected 20 companies are among the largest companies of the country and are listed on the Madrid Stock Exchange -IBEX35-. Additionally, due to the companies’ size, it can be inferred that they are likely to display corporate responsibility initiatives and sufficient disclosure of non-financial information. Additionally, research has shown that MNCs’ reporting is better and more sophisticated, aside from a wider amount of information (Jenkins & Yakovleva, 2006). It is worth noting that being a member of Dow Jones Sustainability Index 2011 is related to the information disclosed related to 2010. Thus, all the reports analyzed in the context of this study were Sustainability Reports issued in 2011, regarding the information reported occurring during 2010. The increasing access to Internet has driven companies to use it as a central channel to communicate their CSR practices, in detriment of traditional channels. (Bravo et al. 2011). Several studies in the field have already used online information to study the management of CSR matters in companies in different sectors (Cornelius et al. 2007; Hou & Reber 2011). These companies belong to key economic sectors such as oil and gas, electric power, heavy construction, financials and are displayed in table 1 below

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Table 1.Study sample and basic features

COMPANY SUPERSECTOR (ICB)(*)

Market value $m

Number of employees (****)

1 ABERTIS TRANSPORT SERVICES 13,571.8 12,284 2 ACCIONA HEAVY CONSTRUCTION 7,060.9 31,687 3 ACS HEAVY CONSTRUCTION 14,728.9 138,542 4 BBVA BANKING 51,375.0 104,755

5 DIA FOOD RETAILERS 34,037.8(Carrefour

Group) 5,770

6 ENAGÁS GAS DISTRIBUTION 5,241.4 1,047 7 ENDESA ELECTRICITY 52,678.0 (Enel) 24,732 8 FCC HEAVY CONSTRUCTION 4,669.1 90,013 9 FERROVIAL HEAVY CONSTRUCTION 7,146.4 101,404

10 GAMESA RENEWABLE ENERGY EQUIPMENT

N.A. 7,262

11 GAS NATURAL FENOSA

GAS DISTRIBUTION 17,050.3 18,778

12 IBERDROLA ELECTRICITY 44,597.6 29,641 13 INDITEX APPAREL RETAILERS 41,165.1 100,138 14 INDRA COMPUTER SERVICES N.A. 28608 15 LA CAIXA INVESTMENT SERVICES 16,695.8 25,288 16 MAPFRE FULL LINE INSURANCE 10,741.4 15,325

17 RED ELÉCTRICA ESPAÑA

ELECTRICITY 7,273.1 1,763

18 REPSOL INTEGRATED OIL AND GAS

28,959.8 36,323

19 SANTANDER BANKING 109,566.6 178,869

20 TELEFÓNICA FIXED LINE TELECOMMUNICATIONS

108,322.9 285,106

(*)The Industry Classification Benchmark (ICB) is a definitive system categorizing over 70,000 companies and 75,000 securities worldwide, enabling the comparison of companies across four levels of classification and national boundaries. It comprises 10 industries, 18 supersectors, 40 sectors and 114 subsectors (**) 2010 market value retrieved form Financial times (***)NA: Not available (****)The number of employees, as disclosed in the 2011 CSR Report, corresponds to the global number of employees

3.2. Data collection and indicators selection The necessary data for the scope of this study was collected along 3 separated (albeit intertwined) dimensions that are displayed in the figure below. Along these lines, the whole data collection was based on content analysis (Krippendorff (1990). Among others, it has been undertaken by Tilt (2001), Hartman et. al (2007) Pérez & Sánchez (2009), Bravo et al. (2012) in comparable studies of CSR and sustainability. More specifically, the results of the information review were gathered in a spreadsheet, in order to facilitate the analysis. A basic rating scale (0 and 1) was used to represent the presence of relevant information on the subject (Purushothaman et al., (2000). A 1 was assigned if meaningful information was found. On the other hand, a 0 score means no meaningful information was found for the specific issue. Additionally, other relevant information for the context of the study was retrieved (i.e. Assurance provider, number of reports issued, GRI reporting level, etc.)

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Reporting features

Data collection

Governance and strategy

Information disclosure

• GRI guidelines

• Number of reports issued

• Integrated reporting

• Third party assurance and provider

• Dedicated committee

• CSR / sustainability master plan

• Disclosure on management approach

• Indicators

• Goals

• Communication platforms

Figure 6. Data collection diagram

3.2.1. Reporting features More than 10 years ago, the book Walking the Talk by Holliday et. al (2001) showed that around one third of 996 DJSI-eligible companies disclosed their information regarding social and environmental aspects. Nowadays, a greater number of companies are publishing sustainability information in response to society’s demands for accountability.

A set of distinct reporting features of the reports has been selected to depict a general photo of the current reporting trends in Spain. For this purpose, the information was mainly retrieved from the different companies’ dedicated portals and from a new GRI’s sustainability disclosure database, a pool of information that includes the CR reports issued by companies and the general features of those (GRI, 2011)

The selected features are:

A) GRI guidelines As it has been previously stated, GRI guidelines are consistently being applied by corporations as it is the most commonly accepted standard. Thus, it was deemed relevant to confirm the use of this tool and the extent of application within the study sample. B) Number of reports issued Although some companies began disclosing their environmental and social information already in the late 90s, it was deemed necessary to compile information concerning the number of reports issued as an indicator of maturity for the companies, and with a further aim at determining whether timing is somehow correlated to disclosure of information. C) Integrated reporting Financial and sustainability reporting have been traditionally walking separate paths. Since the first one has a large trajectory and is mandatory in many countries, the later has just been recently institutionalized. Moreover, a new emerging approach is growing: integrated reporting, which keeps traditional accounting information intertwined with sustainability drivers.

Section 3.2

Section 3.2.1

Section 3.2.2

Section 3.2.3

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D) Third party assurance As it has been stated in the previous section, there has been a steady increase of large companies opting to have their sustainability data reviewed in order to gain credibility.

3.2.2. CSR and sustainability governance This section aims at measuring the relative importance of CSR within the organizational structure of the company, their vision and values. Sustainability internal governance points out the degree of integration of the sustainability variable within the organization. Traditionally, lack of support by senior management has been one of the most difficult problems to overcome in order to implement sustainability at the core of companies (Willard, 2005). Furthermore, the GRI report covers disclosure of the company’s profile, governance, and performance (GRI, 2008). This aspect has been measured in the context of this study identifying dedicated committees and/or sustainability master plans. A case study highlighting the importance of internal CSR governance mechanisms and defined strategy is found in Enel’s, where CSR has become a core element in the organization (Pistoni & Songini, 2008). In this process, one milestone was the creation of two dedicated units (CSR unit and EnelDATA) in charge of the CSR implementation and planning and monitoring, respectively. 3.2.3. Information disclosure analysis This part of the research was devised to produce an in-depth picture of how the companies effectively measure and report key information such as greenhouse gas emissions or supply chain management. The indicators have been chosen from 3 different dimensions, consistent with the triple bottom line framework: economic, social and environmental. These have been chosen based upon the findings of Skouloudis & Evangelinos (2009). They studied the most frequently disclosed indicators, and concluded that energy, water and GHG emissions were the most commonly reported ones. These authors also pointed out that topics such as occupational health, skill management and employee benefits are frequently reported as well. Based on the aforementioned information, a final set of 10 specific indicators was chosen and they summarized in the following table:

Table 2. Basic indicators broken down by dimension Economic dimension

Codes of conduct and compliance Customer relationship management

Environmental dimension

Environmental policy / management system Energy management Climate change strategy Water management

Social dimension

Labor practice indicators Human capital development and performance Suppliers management Corporate philanthropy

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3.3. Indicators assessment There is an inherent risk in this research field which was pointed out by Wood (2010), as disclosure of information can be used as a surrogate of the actual CSR performance. In order to avoid that risk, every indicator was measured in four different dimensions, in an effort to take into account how that specific trait is regarded in a company, evaluated, managed and communicated to the stakeholders. Daub (2007) undertook a similar approach in a study that looked into Swiss companies’ CSR and sustainability disclosure. In the context of this study, the following rationale was used for the assessment:

Disclosure Measurement Goals Communication

In the current research, slight modifications from Daub’s model were assumed, in order to render a clearer view of the management practices undertaken by the Spanish companies, and how the information was disclosed.

A) Disclosure on management approach: It has been documented that for organizations disclosing information in sustainability, transparency takes precedence over other issues. It is assumed that public disclosure brings general positive results and creates a competitive advantage and an advantageous operational and reputational status (Blyth, 2005). B) Measurement Indicators are recognized as a meaningful tool for measuring and assessing sustainability performance. As it is stated by Tokos et al. (2012), the utilization of indicators is convenient for measuring, tracking and seeking improvements. Adams and Frost (2008) have highlighted the importance of key performance indicators for corporate reporting. Complementarily, Singh et al. (2009) argue that indicators serve as tools to prevent economic, environmental and societal damages, supporting the decision-making process. C) Goals The GRI indicators are designed to provide reliable information in a performance against goals basis. Thus, objectives-setting is considered as another relevant aspect to measure. In this regard, Lee et al. (2011) highlight the importance of showing a clear definition of principles, goals and scopes. Complementarily, it has been demonstrated that larger companies, and more active in the CSR and sustainability field, are including sustainability goals in their decision making (Tokos et. al. 2012). The importance of setting objectives has been well documented throughout case studies such as the aforementioned concerning Enel. Already in 2003, the company incorporated social and environmental objectives into the business plan (Pistoni & Songini, 2008). D) Communication There is a growing interest on the way the sustainability-related information is disclosed by the companies. Thus, it was deemed relevant for this research to include a communication dimension within the context of each particular indicator. Roca et. al (2012) expect a growing pool of research in this area, since companies are increasingly disclosing sustainability information in their websites.

A basic rating scale (0 and 1) was used to represent the finding of relevant related information (Purushothaman et al., 2000). Hence, a 0 score means no meaningful information was found for the specific indicator and 1, wherein there was information disclosed in that regard (for instance, explanation of the company’s environmental management systems, coverage of implementation, goals set, etc.) Each company can attain a maximum score of 40 points (full score on all 10 indicators). Each indicator can receive a maximum score of 4 points. Thus, the set of indicators summarized in Table 2 and the analytical framework used resulted in a final score for every sampled company.

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4. Results The results are presented according to the order used explained in the methods section, along the diagram presented in Figure 6 regarding data collection. 4.1. Reporting features The following table (3) displays the findings of the content analysis exercise over the 20 studied companies:

Table 3 Reporting features results

COMPANY

GRI guidelines

Year of first report issued

Integrated reporting

Third party verification

Assurance provider

1 ABERTIS A+ 2003 X PWC

2 ACCIONA A+ 2005 X KPMG

3 ACS A+ 2004 X KPMG

4 BBVA A+ 2003 DELOITTE

5 DIA NO 2010 X X X

6 ENAGÁS A+ 2007 KPMG

7 ENDESA A+ 2000 KPMG

8 FCC A+ 2003 X KPMG

9 FERROVIAL A+ 2001

DELOITTE

10 GAMESA A+ 2008 X AENOR

11 GAS NATURAL FENOSA

A+ 2002 X PWC

12 IBERDROLA A+ 2005 X KPMG

13 INDITEX A+ 2003 SGS

14 INDRA A+ 2005 KPMG

15 LA CAIXA A+ 2007 X DELOITTE

16 MAPFRE A+ 2008 X ERNST&YOUNG

17 RED ELÉCTRICA ESPAÑA

A+ 2003 X SGS

18 REPSOL A+ 2002 X DELOITTE

19 SANTANDER A+ 2004 X DELOITTE

20 TELEFÓNICA A+ 2002 X ERNST&YOUNG

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There are several results that arise from the aforementioned table: • The highest part of the companies (19 out of 20) discloses their information according to the GRI

guidelines. All of them aim at the A level (advanced). • All the companies that use GRI guidelines also seek external assurance of their reports. 84% of the

companies (16 out of 19) rely upon an assurance provider from the so called “Big Four” assurance providers.

• The companies analyzed have been disclosing nonfinancial information since 2003-2004 in average. • Finally, some of these companies (6 out of 20) have begun reporting according to an integrated

reporting approach. Among these, the companies belong to different sectors.

4.2. Sustainability governance Concerning sustainability governance, for the studied aspects, the highest part of the companies present some form of Committee and Strategy. Except for a single company, all the companies that have a dedicated Committee have a strategic sustainability plan and vice versa.

Table 4. Sustainability governance results

COMPANY CSR/sustainability master plan CSR/sustainability committee

1 ABERTIS

2 ACCIONA

3 ACS X X

4 BBVA

5 DIA X X

6 ENAGÁS

7 ENDESA

8 FCC

9 FERROVIAL

10 GAMESA X X

11 GAS NATURAL FENOSA

12 IBERDROLA

13 INDITEX

14 INDRA

15 LA CAIXA

16 MAPFRE X X

17 RED ELÉCTRICA ESPAÑA X

18 REPSOL

19 SANTANDER

20 TELEFÓNICA

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4.3. Information disclosure analysis The table below (5) shows the score obtained applying the aforementioned methodology to perform the analysis of the 20 Spanish companies that are members of DJSI 2011. The results are broken down by dimension and show the final total score.

Table 5. Total scores of the companies analyzed (information disclosure analysis)

COMPANY

Economic dimension

Environmental dimension

Social dimension

Total score

1 ABERTIS 7 9 10 26

2 ACCIONA 4 16 16 36 3 ACS 5 11 12 28 4 BBVA 4 13 11 28

5 DIA 1 5 4 10 6 ENAGÁS 6 12 12 30

7 ENDESA 8 13 14 35 8 FCC 4 10 12 26 9 FERROVIAL 6 14 14 34

10 GAMESA 6 11 12 29 11 GAS NATURAL FENOSA 6 12 11 29

12 IBERDROLA 5 13 12 30 13 INDITEX 4 14 8 26 14 INDRA 8 12 13 33

15 LA CAIXA 7 11 13 31 16 MAPFRE 4 8 8 20

17 RED ELÉCTRICA ESPAÑA 4 12 11 27 18 REPSOL 6 13 12 31 19 SANTANDER 6 9 15 30

20 TELEFÓNICA 8 13 12 33 Average 5,45 11,55 11,6 28,6

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Graph 2. Representation of the final scores

The average grade attained has been 28,6, and the median 29,5, indicating an overall high score for the analyzed companies.

Table 6. Results broken down by indicator

INDICATOR Aggregated score

1 Codes of conduct 54 2 Customer Relationship Management 55 3 Environmental policy/management system 62 4 Energy 57 5 Climate change strategy 66 6 Water management 46 7 Labor practice indicators 61 8 Human capital development and performance 50 9 Suppliers 59 10 Corporate philanthropy/social action 62

Table 6 shows the results of the information disclosure analysis broken down by indicator. The aggregated average values for the indicators measured within the 3 dimensions are:

• Economic dimension: 54,5 • Environmental dimension: 57,75 • Social dimension: 58

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4.3.1. Economic dimension

Graph 3. Representation of the final scores of economic dimension

These results in the Economic dimension depict Endesa, Telefónica and Indra achieving the highest scores (8 out of 8), while DIA is clearly lagging behind.

Ethics and integrity The companies generally have a code of ethics in place. However, not all of them have set a series of indicators to measure progress in this area, such as number of employees trained in Code of Ethics procedures. Indra, Telefónica, Abertis and Endesa are the most advanced companies in this indicator, ac according to results. The average value registered was 2,7 Customer relationship management The studied companies achieve a final average grade of 2,75. Additionally, there are several companies that achieve the highest score, such as Telefónica, Santander, La Caixa, Indra and Endesa.

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4.3.2. Environmental dimension

4 4 43

2 23 3 3 3 3 3 3

43 3 3 3

23

2

4

1 3

23

32

43

23

4 23

2

43

3

4

2

4

3

4

1

4

4

3

4

4

4

4

4

4 4

1

4

4

3

31

4

3

3

0

3

3

2

3

3

3

3

3

21

2

1 3

1

3

0

2

4

6

8

10

12

14

16

18

Water management

Climate change strategy

Energy

Environmental Policy/Management System

Graph 4. Representation of the final scores of environmental dimension

The graph 4 above shows Acciona as leader of the dimension, achieving a maximum score in all 4 indicators:

Environmental policy and management system The highest part of the analyzed companies shows an environmental management system in place. For this aspect, the average score is 3,05. Energy The average score is 2,85. The highest part of the companies analyzed seems to take an efficiency approach towards this matter. Climate change It is the highest scored value, with an average score of 3,4. Additionally, there are several companies that achieve the maximum score (4) in this aspect. Water management On the other hand, water management is achieves the lowest score within the environmental dimension, with an average value of 2,35. However, Acciona is the only company that achieves the highest score in water management.

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4.3.3. Social dimension

Graph 5. Representation of the final scores of social dimension

Labor practice indicators The highest part of the companies show an advanced reporting system concerning Human Resources, scoring an average value of 3,05. Almost all the companies report on their FTE, disclosed according to GRI guidelines. Human capital development and performance It achieves an average of 2,5 . Generally, there was detected a lack of objectives regarding training and human capital performance. Supply chain management Supply chain management shows results near the average value of the dimension, 2,95, showing some companies with a maximum rating such as Ferrovial, Acciona ,Endesa, Santander and Gamesa. Corporate philanthropy and social action This aspects gets the highest average value, with 3,1. Additionally, some companies such as Endesa, Acciona, Ferrovial and La Caixa display consistent social action plans.

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5. Discussion The research proposal was outlined to bring up results backed up by the assessment performed. The sample revealed a rich pool of information. There are several inferences that can be made from the consolidated results obtained in the content analysis, whose results are being discussed following the previous structure displayed in the aforementioned sections.

5.1. Reporting features The reporting features, overall, showed a high level of maturity in the companies analyzed. Since most companies have, in average, issued more than 4 reports, it is assumed a high degree of maturity in this sense, and it can be argued that GRI framework, experience (understood as number of GRI reports issued) and third party assurance are key elements for companies to undergo the DJSI process. The different aspects contemplated in this context are discussed below:

A) GRI guidelines All the companies, except for DIA were A-reporting companies. We can conclude that aiming at the maximum GRI disclosure level helps companies retrieving and presenting the information necessary to be recognized as DJSI members, and further research can confirm that the highest part of DJSI members have solid reporting background. On the other hand, there are also critical voices regarding GRI reporting framework. Although being an A-reporter may seem valuable for the organization in terms of management, and accessibility of information may not bring a high value nor empowerment for civil society. (Levy et. al. 2006). B) Number of reports issued The results observed are consistent with KPMG’s findings in the latest Corporate Reporting Survey (2011), where an overall increase in the number of reports. The results of this study do not show a clear linear relation between the number of reports issued and a net improvement (assessed by the methodology proposed in this research). This fact leads to think that there are other factors involved in this equation such as empowerment of the CSR department, the business case for sustainability in each company, stakeholders’ pressure, type of activity, etc. A further research approach could look into the reasons that led these companies to begin disclosing sustainability information. Furthermore, an interesting question arises in this context: were these companies already managing these aspects before realizing the need to communicate them? C) Integrated reporting As it is stated in KPMG’s Corporate Reporting Survey (2011), integrated reporting is thought to be the next step in regards to corporate reporting. The findings of this research show a first sample of companies that have already undertaken this approach. BBVA, Endesa, Ferrovial, Indra, inditex, Enagás.. Apparently, there is no relation towards the type of activity. It is expected that over incoming years, an increasing number of companies will follow this approach, as well. However, it must be a careful and meditated approach, as the integrated reporting is not just talking about producing a single report out of two independent documents, but rather seeking the particular business case for sustainability for each organization. This new reporting feature can also represent a differential value, and it might have been embraced by these companies wanting to be regarded as sustainability leaders. In this case, it is worth mentioning the case of BBVA, who has pioneered in reporting in an integrated way and disclosing the information relying more in the website rather than producing a report. A further research proposal could look into the specific motivations of each organization for integrated reporting and determining the key factors to take into account within this process.

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D) Third party assurance According to Park & Bronson (2005), some of the reasons a company may engage in third party assurance, asides from increasing credibility of its information, is gaining recognition by awards and benchmarking against other companies. Manetti & Toccafondi (2012) affirm that a large majority of reports (about 2/3) are assured by AAPs, with a clear prevalence, among these, of the ‘Big Four’. This research revealed that 16 out of 19 rely upon an assurance provider from the so called “Big Four” assurance providers. An interesting pool of research will arise from the study of the reason why these providers clearly dominate the market, the expertise they show and the situation for smaller providers, that may have had specialized in delivering other services for these companies. Still, it can be assumed that third party assurance has become widespread among Spanish Multinational Companies due to its inherent benefits. On the other hand, seeing that almost all the companies have verified their reports, a risk is identified as this may have become a standard process, a formality, and no real value is being added from this independent review; As Manetti and Toccafondi (2012) argue, stakeholders are often neglected and scarcely involved during the assurance process. Another specific risk regarding assurance has been identified by Owen et.al (2004). They argue that the scope of the current assurance processes might not be sufficient to provide a complete verification of the information. Therefore, further research can look into improvements to current assurance practices and how these are going to respond to the newly integrated reporting practices.

5.2. Sustainability governance According to the aforementioned results, governance has been well described by the 2 chosen aspects: committee and strategic plan. They appear to be intertwined aspects, as in almost all cases they are reported simultaneously. It is argued that both a sustainability committee and a strategic plan are steps toward integration of CSR in the business. As Yuan et. al. (2011) argue, integration of sustainability occurs in a 3-stages process: external consistency internal consistency coherence. Additionally, Pistoni & Songini (2008) studied a specific study case regarding the effective implementation of sustainability at the core of the organization. In this case it is highlighted that early promotion of committees to coordinate the dissemination of CSR within the organization was a key aspect for Enel, where managers are increasingly relying upon sustainability indicators in the decision-making process, and thus contributing to an implementation of CSR in the company. Also, it can be argued that having effective bodies may be a strategic element towards entering sustainability indexes such as DJSI. The existence of sustainability plans may act as facilitators for mainstreaming sustainability. Bolton’s conceives CSR as a fluid and dynamic process, offering a broader understanding of what it means to be a socially responsible organization at both the strategic and interactive levels where companies adopt pro-active positions in regards to sustainability through specific mechanisms such as committees and strategies. Based on the results, it is argued that these CSR specialized committees and plans are key platforms for embedding sustainability in the organizations. However, they are not precursors themselves. More often than not, it is a vision transmitted from top management to the organization. In this regard, the concept of CSR policy arises as a necessity along with planning and governance bodies (Morand et al. 2006).

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5.3. Information disclosure analysis The results point out that the approach taken to measure these companies was consistent, since the companies generally performed well along the proposed dimensions for every indicator. Attending the final results, a general high average grade was attained (28,6) and a yet higher median (29,5) corroborate the maturity of the Spanish market with regards to CSR and sustainability issues. The disclosure analysis revealed Acciona as the most advanced company according to the proposed methodology. The in-depth analysis of the disclosure of information and communication strategy suggests that sustainability is being successfully embedded in the company. We argue that in this case, this company’s CSR strategy appears to become another element contributing to the business strategy and generating profit. On the other hand, DIA shows the lowest scores. The company has a limited experience in this context, since it just began reporting sustainability practices, and it is part of the greater Carrefour group, and thus gained access to DJSI as part of this higher organization. Deegan & Gordon (1996) concluded that companies representing industries with higher associated environmental impacts reported a higher amount of CSR information. The findings of this research confirm this finding. The companies with the 3 highest reported scores in this study are Acciona, Ferrovial and Endesa. It can be inferred from the results that certain sectors (especially energy and construction) generally achieve better scores than the rest of the sample companies. Since the content analysis was designed to measure the amount and variety of information disclosed, and thus proved that high-impact companies have in place consistent and complete reporting structures to manage and disclose nonfinancial information. Font et.al. (2012) express similar conclusions in their study of disclosure-performance gap, where they found larger Hotel groups displaying higher reporting in CSR reporting. At the same time, we argue that impact on the environment is not the single driver that thrusts a company towards a better management and disclosure of sustainability. Instead, the combination of impact caused and other factors such offering products and services relying heavily on sustainability may be another important aspect to take into account. In other words, how important is sustainability within the company’s catalogue of products. In this case, it is easily deducted that companies may think along the lines ”I want to look and communicate I am a sustainable actor because I want to sell sustainable products and services” Further research is needed along this lines, which will benefit from studying the portfolio of products and services a company delivers. The results displayed through the information disclosure analysis for the studied dimensions (Economic dimension: 54, Environmental dimension: 57,75; Social dimension: 58) are consistent with reviewed literature as well. Searcy (2012) claims that environmental and social issues are the seeds of the current sustainability reporting that provides a valuable explanation towards the higher scores showed in environmental and social features. Additionally, Bolton et. al (2011) propose two key concepts regarding CSR that are also linked to the findings of the disclosure analysis:

• CSR works throughout an emergent process (initiation implementation maturation). • Employee issues become more important and interactive with CSR throughout the process of

development.

According to the scores displayed (showing a high average and median value of almost 30 points), we can conclude that the sustainability case for Spanish companies is mature. Additionally, Bolton’s theory provides a reasonable argument regarding the high scores regarding the human resources indicators in the context of this study (Labor practice indicators and Human capital development). Regarding the proposed measurement rationale for the indicators (Disclosure Measurement Goals Communication) it can be concluded that appears to work for describing an organization approach for the management of well-established indicators. It has specially pointed out climate change strategy, environmental policy, labor practice indicators and corporate philanthropy as the highest scores aspects overall in the context of the study.

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We can argue that this fact may be due to stakeholders pressures (as, for instance, the climate change situation has gained a great momentum and companies are now subjected to higher scrutiny regarding, among others, carbon emissions), management necessities. On the other hand, aspects such as human capital development and codes of conduct show lower scores since they may not have consistent mechanisms in place to measure progress and therefore, are more difficult to set performance objectives in this regard. Moreover, we argue that the aforementioned rationale work as an effective approach in enhancing accountability since it sets the pavement for a solid management of indicators, minimizing the risks of greenwashing. This threat is usually attributed to disclosure of CSR information (Lyon & Maxwell, 2011). Regarding the use of indicators, the content analysis revealed that setting disclosures on the management approach and measurement is the common practice. A study by the International Institute for Sustainable Development (IISD) explored in 2009 the use of corporate sustainability indicators in three key areas and concluded that there is a general lack of knowledge regarding the use of sustainability indicators. Due to the methodology used in the context of this research it is not possible to confirm this assumption, as solely the reporting was measured. Therefore, it is proposed as a further line of study focusing the scope of research in performance against targets and review how indicators may change over time to adapt to new circumstances or scientific research. Patten & Crampton (2004) argued that legitimation may be the main interest of a company for disclosing information, rather than accountability. It cannot be empirically demonstrated due to the methodology set in place. However, it was observed during the analysis, few companies displayed further information on their websites than what was already published in the sustainability reports. We can argue then, that in general terms corporate websites in sustainability are in a low state of maturity, as they are used as information platforms and just a few of them such as Telefónica, Acciona or Ferrovial are actively engaged in generating interactions in a sustainability topic. Overall, the findings are consistent with general trends in sustainability reporting throughout the websites. Bravo et. al (2012) conclude that corporate websites are strategic tools for companies to engage, mainly, with investors and stockholders.

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Pre-compliance

Compliance

Beyond compliance

Integrated strategy

Purposed and passion

Figure 7. Sustainability implementation. Based on Hallsted et. al (2010)

6. Conclusions In general terms, it can be stated that the aim of the study was met. An updated account of Spanish MNCs sustainability disclosing is provided in this research, and it can be concluded that all the analyzed companies display appropriate mechanisms to manage and communicate sustainability performance. On the other hand, the scope of the study cannot prove where those stand when benchmarked against other MNCs. It is true that 20 member companies (with Repsol and Enagás as supersector leaders) is a remarkable amount of companies, but are these organizations ambitious enough in this regard? are they feeling well accommodate where they stand? However, it is very important to set boundaries and have a clear goal towards the role the organization wants to adopt. In some cases, being transparent can even trigger some unexpected outcomes. That is why Kaptein (2007) argues that companies need to make a decision that balances the organizational stakeholders’ expectations. It also can be concluded that GRI is a strategic and widespread tool for MNCs companies towards sustainability disclosure and communication. Additionally, DJSI serves as a consolidated benchmark that provides a periodical screening on the sustainability performance. The integrated reporting trend poses a further challenge for companies to show how sustainability is embedded in their business culture. Regarding the incorporation of sustainability into companies’ culture, Lopez et al. (2007) argue that CSR practices must be incorporated into the strategy on the grounds that it may bring a clear qualitative positive repercussion, and eventually, a quantitative and financial one. Trying to depict a general picture of the current sustainability reporting situation in Spanish MNCs leads to think along the lines of how embedded sustainability really is within these organizations. Hallsted et al. (2010) proposed an approach for sustainability implementation in organizations that depicts this process, as indicated in Figure 7. From the content analysis described in the results section , I may conclude that Spanish companies are mostly in a Beyond Compliance state and the sustainability case in Spain is mature enough. In this context, it is worth mentioning that some of the sample companies have had a specific Department of CSR or Sustainability in place since 2002. On the other hand, few companies are successful in conveying a truly oriented sustainability message and the importance for the business, along with brand considerations and participation of stakeholders. In this regard, media is increasingly setting the path for turning sustainability into a differential value. I reckon my research has contributed on the lines suggested by Searcy (2012), who argued that this academic field may benefit from studying the actions companies have undertaken that facilitated their recognition as DJSI members. In my study for the Spanish context, these factors were identified:

• Third party assurance of sustainability information • Commensurate experience • Having a consistent pool of indicators (mostly based on GRI framework) • Coordinating sustainability implementation by internal governance bodies • Having a specific sustainability master plan to coordinate the improvement actions

Sustainability reporting will remain useful for investors into the future and will likely become more important over time as sustainability-related pressures continue to reshape market conditions (Slater & Gilbert, 2004). It is worth noting that DJSI is paid by investors. On a related note, we can assume that sustainability reporting is mainly made for investors and shareholders. What happens, then, with general audience/society? An

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interesting consideration in this regard is who reads these sustainability reports? There is no evidence of a reader’s baseline (i.e. nobody!). In my opinion, there is a lack of interest except for specific stakeholders such as NGOs and consumer associations that take the time to dig into this information. Perhaps, research should also be oriented along the lines of the reader perceptions (Fifka, 2012). In this context, the author also highlights the lack of knowledge of the role of language in Corporate Responsibility reporting. I reckon the present paper provides an answer to that question, since all the analyzed companies presented the very same sustainability information (in both reports and websites) in the very same formats, available in Spanish and English. The analysis revealed to be thorough and richer in information than it had been anticipated, allowing consistent comparisons across companies from different sectors. The interpretations are multiple, and the room for predictions is still wide. On the other hand, there are some limitations identified regarding the methodology; in the context of content analysis, subjectiveness of the assessment is not completely avoided by relying on the interpretation of one single rater. Additionally, the terms sustainability, corporate social responsibility, corporate responsibility, among others, are examples of a common phenomenon in this scenario:. There is no unified terminology and fuzzy words are everywhere, which just lets wide room for misuse of terms and misinterpretations. Another limitation identified during this research derives from relying uniquely upon publicly disclosed information from the companies. In this context, Staniskis & Arbaciauskas (2009) also note that placing the focus in the external sources may neglect the valuable information that may be retrieved from internal stakeholders, such as employees. This research shows that Corporate Reporting is increasingly becoming more holistic and integrative. In this regard, for consistent changes to occur there are several success factors to take into account such as lasting relation with internal and external stakeholders, setting objectives and creating internal and external awareness. As López-Vázquez and Fornes argue (2011), in order to manage the risk of operations both internal and external stakeholders must be taken into account. In this regard, it has a capital importance that ethical, environmental and social expectations are actively managed and addressed along with the economic dimensions. Actions aimed at short-term measures, fail to create value for shareholders and society. Furthermore, the role of companies has been identified as key for the advancement of sustainability in global terms. As Fairbrass (2011) states it, “they (MNCs) are seen as being especially well-placed to tackle sustainability problems via their corporate social responsibility (CSR) policies and practices because these can be used to directly affect production and consumption activities within society”. Hence, I reckon we should all collaborate in order to get an integrative CSR model, including the latest innovations in order to enhance transparency and outreach. Last, but not least, the debate around new communication platforms to convey information is being actively debated lately. It can be said that Internet is democratizing communication, which brings simultaneous risks and opportunities. On one hand, companies can reach a higher amount of stakeholders investing less money and resources. However, MNCs are more vulnerable than ever or, in other words, more in need than ever, of a transparent management that may lead towards building relations with stakeholders. In the current global and complex scenario, it is not a simple task to distinguish between sustainable and unsustainable, between black and white. In my opinion, given the vast amount of information found and the international efforts in this issue, we are in an optimistic current how do we do it? , which has replaced the previous decades’ should we do it? Civil society is empowered by the day, relying on more accountable organizations. In this scenario, we should keep enhancing awareness to become a powerful actor with a say in the communities where MNCs operate. The tools are at reach, do we know how to use them? do we want to use them? or, do we dare to use them? After all, great power brings great responsibilities, doesn´t it?

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Companies CSR websites • ABERTIS: http://www.abertis.com/our-vision/var/lang/en/idm/494 • ACCIONA: http://www.acciona.com/sustainability • ACS: http://www.grupoacs.com/index.php/en/c/corporateresponsibility • BBVA: http://bancaparatodos.com/en/ • DIA: http://www.diacorporate.com/diawebapp/web/sustainable-development-and-csr.jsp • ENAGÁS: http://www.enagas.es/cs/Satellite?cid=1146235253344&language=en&pagename=ENAGAS%2FPage%2FENAG_pintarContenidoFinal • ENDESA: http://www.endesa.com/es/nuestrocompromiso/Paginas/home.aspx • FCC: http://www.fcc.es/fccweb/responsabilidad-corporativa/index.html?lang=EN • FERROVIAL: http://www.ferrovial.com/en/Corporate-Responsibility • GAMESA: http://www.gamesacorp.com/en/sustainability/ • GASNATURALFENOSA http://www.gasnaturalfenosa.es/es/inicio/conocenos/informacion+corporativa/1297078449292/responsabilidad+corporativa+.html • IBERDROLA: http://www.iberdrola.es/webibd/corporativa/iberdrola?cambioIdioma=ESWEBRESPONSOS • INDITEX: http://www.inditex.es/en/corporate_responsibility • INDRA: http://www.indracompany.com/en/sostenibilidad-e-innovacion • LA CAIXA: http://www.caixabank.com/responsabilidadcorporativa_en.html • MAPFRE: http://www.mapfre.com/responsabilidad-social/en/general/mapfre-social-responsibility.shtml • RED ELÉCTRICA ESPAÑA: http://www.ree.es/ingles/responsabilidad_corporativa/rc-compromiso_mision.asp • REPSOL: http://www.repsol.com/es_en/corporacion/responsabilidad-corporativa/ • SANTANDER: http://www.santander.com/csgs/Satellite/CFWCSancomQP01/es_ES/Corporativo/Sostenibilidad.html?leng=en_GB • TELEFÓNICA: http://www.telefonica.com/en/corporate_responsibility/html/home/home.shtml

Commonly used abbreviations in the document • CSR: Corporate Social Responsibility • DJSI: Dow Jones Sustainability Index • SAM: Sustainable Asset Management • GRI: Global Reporting Initiative • ESG: Environmental Social Governance • MNCs: Multinational Companies • IIRC: International Integrated Reporting Committee

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Acknowledgements First of all, I’d like to thank Uppsala University, SLU and CEMUS for the exciting and rewarding academic opportunities I have enjoyed here. Despite the cold I’ve always felt warmly welcome here. A special thanks to all the classmates and friends I’ve met during those two years I spent in Uppsala and a reminding for you all: youth is a state of mind!

I would like to thank my family for supporting my determination of undertaking my postgraduate studies far from home, keeping up with my never-ending willingness to embrace a new life.

I want to thank Belen López as well for her priceless guidance during this research; the inspiring and enlightening meetings with her were extremely valuable in the context of this study and my professional career.

Additionally, I’d like to thank Maria Elena García, Javier Ballesteros and Monika Gawlik for their relentless spirit and good humor, especially during tough times!

To my all-time friends Novo, Rodrigo, Bruno, Carlos, Gon, Sergio and Dani I say, ¡Gracias! ¡Nunca nos falta un nuevo proyecto que llevar a cabo cualquier fin de semana!

A special mention also should be made to my restless allies during the elaboration of this project, wherever I may roam: music and coffee!

And last, but not least, raise your cups and toast to the futures ahead! May they bring us not what we ask, but what we need.

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"I find I am so excited I can barely sit still or hold a thought in my head. I think it's the excitement only a free man can feel, a free man

at the start of a long journey whose conclusion is uncertain. I hope I can make it across the border. I hope to see my friend and shake his

hand. I hope the Pacific is as blue as it has been in my dreams. I hope."

The Shawshank Redemption, 1994