A Guide to Corporate Social Responsibility for One-Person Enterprises

A Guide to Corporate Social Responsibility for One-Person Enterprises

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A Guide to Corporate Social Responsibility for

One-Person Enterprises

Vienna, 2010


Contents

Foreword . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4

What is Corporate Social Responsibility (CSR)? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5

How Will I Benefit from CSR? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6

Why Focus on One-Person Enterprises? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7

5 Steps to Long-Term Success . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8

Putting the Steps into Practice . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13

Where Can I Get Additional Information? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23

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1 Market-oriented companies with a long-term focus and no co-owners, i.e. sole proprietorships and limited liability companies.

You are about to read what is in all likelihood the world’s first published guide to

corporate social responsibility (CSR) for one-person enterprises (OPEs). 1 You can use it

to explore a range of suggestions for strengthening your business, be it by building a

competitive advantage, optimising conflict and crisis management, or saving costs.

We provide step-by-step instructions and guiding questions designed to help you get

the most out of this guide. Please go at your own pace and decide for yourself which

of the issues discussed are relevant to your OPE. Bear in mind that it’ s about the

journey, not the destination. You’ll make good headway on integrating CSR into

your business just by examining the various aspects covered in the guide and setting

your own priorities.

After you’ve read through the guide you may be curious to see what other

companies are doing about CSR. For examples of good practice undertaken by

different-sized companies, check out “Praxisbeispiele” on the respACT website

[www.respact.at]. Who knows, in a year or two you may become one of the first

OPEs to be listed in this database. W e’d certainly be delighted to include you.

Best wishes,

The Editors

Foreword4

Foreword


What is Corporate Social Responsibility?

Corporate social responsibility (CSR)1 involves balancing the needs of business, society and theenvironment. Responsible companies integrate social and environmental considerations into theirbusiness practices. The aim is to achieve long-term business success while at the same timegenerating social benefits.

CSR enables the strategic implementation, undertaken voluntarily, of the principles of sustainabledevelopment.2

1 The European Commission defined CSR as “`a concept whereby companies integrate social and environmental concerns in their business operations and in their interaction withtheir stakeholders on a voluntary basis’, as they are increasingly aware that responsible behaviour leads to sustainable business success” (Communication from the CommissionConcerning Corporate Social Responsibility, July 2002).

2 Sustainable development means “development that meets the needs of the present without compromising the ability of future generations to meet their own needs” (WorldCommission on Environment and Development, Our Common Future, also known as The Brundtland Report, 1987).

A Guide to CSR for One-Person Enterprises5

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CSR is just as good for a one-person enterprise (OPE) as it is for a multinationalcorporation. Here are some of the benefits:

l Success through better business relationships and environmentally friendly work practices

l A knowledge advantage thanks to a strong customer focus

l Greater ability to withstand conflict and crisis based on earned trust

l Innovative products and/or services as a result of networking with key contacts tounderstand their needs and expectations

l A competitive advantage by positioning yourself as a socially responsible entrepreneur

l Short-term cost savings in the form of immediate savings and thus profits from reducedenergy and resource use

l Long-term cost savings because you have the best tools for managing the challenges ofthe future: dialogue, trust and innovation

You can choose to live your personal values in your business. When you act in accordance with your values, treat your customers and suppliers fairly, and respect the environment, you are helping to build your company’s reputation.


How Will I Benefit from CSR?

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Why Focus on One-Person Enterprises?

In Austria, 51.4% of all commercial companies are one-person enterprises (OPEs)1. In otherwords, 225,592 female and male entrepreneurs are contributing to national value creation. By deciding to act in a socially responsible, values-based way, they can generate significantsocial and environmental benefits.

Today, many successful OPEs engage in activities that reflect CSR ideas and objectives:

l Networking helps. An OPE needs to depend on a strong network in order to be effective.Maintaining good business relationships and treating stakeholders fairly will be critical to yoursuccess.

l Staying up to date. Successful OPEs show high innovation potential. CSR as a forward-looking approach is especially relevant for you in light of the key role of sustainability issuesand the wide-ranging business opportunities they provide.

l Fast and flexible. As an OPE you are uniquely positioned to more readily adapt yourbusiness model to changing conditions and undertake necessary improvements.

l Do it yourself. You’re an all-rounder who deals with office tasks as well as running thebusiness. That requires proper human resource management. Corporations look after theiremployees; you need to look afteryourself!

l Values-based entrepreneurship.Integrating personal values into products and/or services is easier foran OPE than for larger companies.

A Guide to CSR for One-Person Enterprises 7

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1 Not included in this figure are persons who fall into the “New Self-Employed” category, which coversentrepreneurs whose business activity does not require a trade licence and who therefore are not members of the Austrian Federal Economic Chamber or are members of the chambers for the agriculturalsector, doctors, lawyers, tax consultants, chartered accountants, pharmacists and other professions.


5 Steps to Long-Term Success


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A Guide to CSR for One-Person Enterprises 9

Are you drawn to the idea of running your company as a socially responsible business – andreaping the benefits? Instead of proceeding on an ad hoc basis, you want to strategically planhow you’re going to achieve that goal.

The following 5 steps to long-term success are intended to help you integrate CSR into your activities. It’s up to you to decide which of the individual steps to emphasise and how thoroughlyto implement those steps.

The 5 steps are covered on the following pages, along with guidance on carrying them out. It’sworth taking a break from your daily routine to devote some careful thought to planning yourcompany’s future.

The 5 Steps to Long-Term Success

Step 1: Decide what your company stands for

Step 2: Collect information

Step 3: Set your goals

Step 4: Take action

Step 5: Review the results and broadcast your achievements

This HELP symbol links you to the practical suggestions on pp. 13-16 for the implementation ofthe first three steps, which involve preparationand planning.

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Step 1: Decide what your company stands for

HELP 1: What does my company stand for?

OUR TIP: Show the world what your company stands for. You can do that by defining yourvalues on your website. You can also communicate them to your clients, partners andsuppliers formally, in a published brochure or letter, or informally by setting anexample through your actions.

It sounds obvious but often isn’t. You have to make a conscious decision to act in a sociallyresponsible way. Think about how you can input your personal values. Also think about howyou know when your values are not being fulfilled or are actually being violated.

Step 2: Collect information

HELP 2: Who are my stakeholders?

HELP 3: What kind of information do I get from my market?

HELP 4: How do business, environmental and social factors

affect my company?

OUR TIP: The self-employed tend to have solid networks in place because their businessdepends on it. So make full use of your network!

Consult your business environment to gain a better understanding of the business, social or environmental factors that affect your current and future business activities. To ensure that youhave the full picture, you should be able to answer the following questions:

A Guide to CSR for One-Person Enterprises


Step 3: Set your goals

HELP 5: What are the goals I wish to achieve?

OUR TIP: Set goals that are SMART (specific, measurable, attractive, realistic and timely).

OUR TIP: Don’t forget that CSR not only means exciting projects but is also about promotingtransparency. Everything that goes into your products and/or services should beperfectly clear to your customers.

Now that you’ve gone through the first two steps, let’s move on to defining concrete goals.

There’s no such thing as a standard CSR approach. Your CSR activities will reflect your particular situation. You can take small steps and make big strides. Start by overcoming your weaknesses and focusing on your strengths. Here you can use the table in Help 5.

Step 4: Take action

Planning is important but at the end of the day implementation matters most.

OUR TIP: Don’t bite off more than you can chew. Before you undertake a major step, consider teaming up with fellow OPEs or business associates.

OUR TIP: Decide for yourself how fast you want to go forward. Reserve a certain amount oftime every week or month to review the ongoing activities.

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Step 5: Review the results and broadcast your achievements

Review: How can you make sure that your engagement is generatingresults? You should be checking at regular intervals whether you’re movingcloser to meeting your objectives or have already met them. If the targetedresults are not forthcoming, look for possible causes and make changes asneeded.

OUR TIP: Find out what your stakeholders think of your efforts.

Communicate: How to publicise what you’re doing? Use your communicationchannels: your website, your newsletter for clients, client meetings and salescirculars. You needn’t limit yourself to reporting on successfully completed projects; you can also describe the goals you’ve set or solicit feedback onongoing processes.

OUR TIP: Don’t overlook informal information channels, social media and blogs.



Take a few minutes to think about the following questions, either on your ownor together with some of your key contacts. Make a note of the answers youcome up with so that you can refer to them later.

Company: Do I have a competitive advantage over other companies in the market? What isunique about my company?

Values: Are my decisions valued-based? How do I wish to be perceived?

Society: Am I generating any social benefits with my products and/or services? What negative impacts would be unacceptable to me?

Remember: Every action you take has the potential to create value for society.

Putting the Steps into Practice

HELP 1: What does my company stand for?

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Follow these instructions to map your stakeholders. You’ll need pen and paper and a bit of time.It helps to work in a small group so ask your business associates or partners to join you.

l Write down the name of your company at the centre of the sheet of paper and describe itscore business in a short sentence.

l Now write down the names of the people and/or organisations that are relevant to yourcompany.

l Identify the issues and trends that interest these stakeholders.

HELP 2: Who are my stakeholders?

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Examples of Stakeholders

l Clients: Who buys my products and/or services?

l Suppliers, sources, product origin: Where do I source products for my company?Where do I get my information from?

l Partners and networks: Whom do I work with on projects or other activities?

l Local and regional impacts: Does my business impact on any of my immediateneighbours? How does it affect my town or region?

l Family, friends, personal life: Which of my personal relationships are affected by my business activities?

l Associations, interest groups, NGOs: What organisations represent my professionalgroup or my stakeholders?

l The community: What are the trends in my community? What entrepreneurial corecompetences could I contribute and where?

l The media: Who is reporting on my business activities in the local paper and in specialist media?

Examples of Trends

l A healthy, sustainable lifestyle

l Aging society

l Digitalisation

l Globalisation

l Individualisation

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How one communicates with the market is a matter of personal choice but it undeniably affectssuccess. We recommend taking a structured approach to enable you to keep track of andexploit your market knowledge. The suggestions below are aimed at helping you expand yourinformation radar.

In your business you tap into two broad types of knowledge: your professional knowledge andspecific areas of expertise, and your market and stakeholder know-how.

1. Expanding your professional knowledge and specific areas of expertisel What kind of information sources do I use to keep up in my field, and when? Do I rely on

professional associations, interest groups, the general media, trade publications, regular get-togethers, the automated information systems of online platforms and search engines?

l How do I go about getting feedback on my products and/or services? Is the feedback thenincorporated into my quality assurance processes?

l Am I innovative? Do I keep up with new developments in the field?

2. Expanding your market and stakeholder know-howl How well do I know my clients, suppliers, partners and competitors?

l When and where do I meet potential business partners and clients? Do I meet them at tradefairs, conferences or evening events? Through network groups or online platforms?

l Am I soliciting feedback from family and friends?

l Do I take advantage of professional associations’ networks?

What kind of information do I send out and where, and from whom do I receive information? Analyze the ways in which you communicate with your various stakeholders and they communicate with you.

For best results we recommend setting up a feedback loop of surveys and discussions aimed atfinding out whether information has reached the recipient the way you intended, as well as whatthe reactions were.

HELP 3: What kind of information flows between me and my market?

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HELP 4: How do I impact my market and how does it impact me?

Here is a self-test to help you assess the impacts your company has on your business environmentand vice versa. You don’t have to answer each question right away. You can also use the test asa way to identify ideas for future activities.

Your Company’s Impacts on the Community, Environmentand Marketplace

How do you assess the impacts of your company in these three areas: the community, the environment and the marketplace?

The self-test is structured according to processes in the value chain: Purchasing, Productionand/or Services and Sales. Two questions are listed under each of the processes. One ofthem refers to your company’s impact on your business environment, and the other refers to theimpact of the business environment on your company. To the right are three boxes underCommunity, Environment and Marketplace. Fill in the boxes with the following symbols:

+ Positive impacts

– Negative impacts

3 Impacts ok but could be better

? Don’t know

To help you fill in the form, more questions are provided on pp. 18-20. They correspond to thenumbers in the Help field (Help A1, etc.).

Instructions

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Community Environment Marketplace

Purchasing

What impacts do your purchasing activities have on your business environment?

Help A1 Help A2 Help A3

What impacts does your business environment have on your purchasing activities?

Help B1 Help B2 Help B3

Products and/or Services

What impacts do your products and/or services have on your business environment?

Help C1 Help C2 Help C3

What impacts does your business environment have on your products and/or services?

Help D1 Help D2 Help D3

Sales

What impacts do your sales activities have on your business environment?

Help E1 Help E2 Help E3

What impacts does your business environment have on your sales activities?

Help F1 Help F2 Help F3



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Purchasing

Help with the question “What impacts do your purchasing activities have on your business environment?”

Help A1 Community

What are the social impacts when I buy products, raw materials, contracted services, etc.? How do my purchasing activities affect various components of society, such as my town, my region, organisations or civil society?

Help A2Environment

How are my purchasing activities related to natural resource conservation or the avoidance of tropical wood products, ivory or fur?

Can I influence the quality and durability of the raw materials I purchase?

Help A3Marketplace

Do my purchasing activities affect economic growth? Do my purchasing activities affect the pricing of my products and/or services?

Help with the question “What impacts does your business environment have on your purchasing activities?”

Help B1Community

What effect do new trends and expectations in society, such as the demand for transparency, have on my purchasing activities?

How are my purchasing activities affected by various components of society, such as my town, my region, organisations or civil society?

Help B2Environment

How are my purchasing activities affected by current environmental issues such as pollution, raw material shortages, climate change or energy conservation?

Does my direct environment (the natural environment or product availability) affect my purchasing activities?

Help B3Marketplace

Are my purchasing activities affected by current market trends, such as rising prices, Internet retailing or internationalisation?

Are my purchasing activities affected by administrative authorities and specific regulations?

Supplementary Questions for the Self-Test

Below are additional questions to help you complete the self-test. They are simply meant to serve as guidance.



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Products and/or Services

Help with the question “What impacts do your products and/or services have on your business environment?“

Help C1 Community

Does society benefit from my products and/or services? Do my products and/or services help meet social needs?

Help C2Environment

How do my products and/or services affect the environment (recycling, waste, pollution, etc.)? How do my products and/or services affect my work-life balance?

Help C3Marketplace

Are my relations with my clients influenced by how I communicate about my products and/or services (transparency, accountability, etc.)?

How does the pricing of my products and/or services affect the market?

Help with the question “What impacts does your business environment have on your products and/or services?”

Help D1Community

How are my products and/or services affected by new trends and expectations in society, such as demands for transparency?

How are my products and/or services affected by the local business environment, nearby residents, transport, educational institutions, communications infrastructure, cultural organisations or sports associations?

Help D2Environment

To what extent are my products and/or services affected by environmental concerns, e.g. my choice of raw materials?

How are my products and/or services connected to direct environmental impacts such as emissions to air, the discharge and disposal of wastewater, and waste avoidance, processing, recycling and disposal?

Help D3Marketplace

Are my products and/or services affected by changes in prices and other market trends? Does feedback from my clients, partners and competitors influence my products and/or services?



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Sales

Help with the question “What impacts do your sales activities have on your business environment?”

Help E1 Community

Can I influence society through my pricing strategy? Can I influence society through my marketing and communication activities?

Help E2Environment

To what extent do my sales activities, e.g. when I deliver to my customers, contribute to carbon dioxide emissions or noise pollution?

What are the environmental impacts of my packaging and advertising materials?

Help E3Marketplace

How do my sales activities affect my competition and my business partners? How do my sales activities affect my current and potential clients?

Help with the question “What impacts does your business environment have on your sales activities?”

Help F1Community

What role do new trends in society, such as demands for transparency and fairness, play in my sales activities? To what extent do social trends affect my pricing, marketing and communication strategies?

Help F2Environment

Are my sales activities affected by direct environmental aspects such as emissions to air, the discharge and disposal of wastewater, and waste avoidance, processing, recycling and disposal?

Are my sales activities affected by indirect environmental aspects such as packaging, transport, waste disposal, and the environmental performance and practices of my suppliers?

Help F3Marketplace

In what ways can customer needs and requirements influence my sales activities? How are my sales activities impacted by my competitors’ prices and product development?



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HELP 5: What are my objectives?

Here are some tips to guide you as you create your table of objectives (p. 22):

l Check the self-test under Help 4 to ascertain in which of the three categories – Community, Environment, Marketplace – your company has particularly positive or particularly negative impacts.

l Take advantage of your strengths.

l Work to overcome your weaknesses.

l Do all you can to live your values in your everyday business.

l Think about whether or how you could respond to trends in society through your productsand/or services. Use potential social and environmental innovations as an opportunity to gaina competitive advantage.

l Make sure the goals you set are SMART (specific, measurable, attractive, realistic and timely).

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Your objectives table could look something like this. The examples given are merely intended to serve as inspiration.It’s up to you to define your own objectives.

Sample Objectives

Objective Stakeholders Actions Timeframe

Category: Community

Spend 2 days a year doing volunteer work for an NGO to strengthen my social competence

The community, NGOs Look for an NGO that would be appropriate for my company or interest me personally; identify how I could contribute; integrate what I learn into my everyday business

Research: up to 1 monthVolunteer work: 2 days a year

Increase and improve business ties

Partners, networks, local residents, local markets, the community, professional associations, etc.

Explore relations with banks, purchasing sources, clients, administrative authorities

Up to 3 months

Offer discount rates for low-income clients

Clients (the community) Define client groups, review pricing Up to 2 weeks

Category: Environment

Cut carbon dioxide emissions

The environment Instead of driving use public transport to get to meetings in the city

Starting now

Reduce energy use The environment Thoroughly check potential energy savings; always turn off electronic equipment when not in use, avoiding standby mode

Starting now

Find out about environ-mental requirements affecting OPEs

The environment Consult local environmental authorities or other experts

Up to 2 months

Category: Marketplace

Increase client satisfaction

Clients Create a client survey for distribution through varied communication channels

Up to 2 weeks

Adapt products and/or services to social needs

The community, clients Discuss with stakeholders: “Which social or environmental challenges could I try to resolve with my products?”

Up to 3 months

Analyse sector trends Professional associations Discuss current trends with the association(s) representing my profession or sector

Up to 2 months



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Where Can I Get Additional Information?

For information on one-person enterprises (OPEs): The Austrian Federal Economic Chamber’s service portal for OPEs www.epu.wko.at (in German)

For information on implementing corporate social responsibility (CSR) activities:respACT – austrian business council for sustainable development (the leading CSR and sustainable development platform for Austrian business)www.respact.at

For information on CSR:The Austrian Federal Economic Chamber, Economic Policy Departmentwww.fairantwortung.at (in German)

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The editors would like to thank all the experts involved in preparing the contents of this guide.In alphabetical order:

Robert Bodenstein, Infomanagement Unternehmensberatung •Roman Buttura, Buttura International • Helene Fink,

Die Fink • Elisabeth Gail, Hauska & Partner • Leo Hauska, Hauska & Partner •Daniela Knieling, respACT • Roman Mesicek, respACT • Annette Märk-Schlaisich,

Hauska & Partner • Rudolf Obereder, EPU Portal der WKÖ • Ingeborg Preininger, Die Berater •Petra Rösler, zwei:und:drei Corporate Citizenship • Andreas Schneider, WKÖ • Lisa Weber, respACT

We also thank the following experts who contributed valuable comments and advice.In alphabetical order:

Michael Bockhorni, nanu netzwerkagentur für nachhaltige unternehmenskultur • Wolfgang Keck, keck kommuniziert • Doris Palz, Palz & Partner •

Dorothee Rathjen, Institut für Burnout- &. Stressmanagement •Ursula Brigitte Rieder, Steuerberatung & Unternehmensberatung •

Claudia Wenzl-Wintersteiger, TRAIN Consulting

We are grateful to Amway for initiating and sponsoring the project. We owe special thanks to Gudrun-Johanna Korec-Neszmerak, Corporate Affairs Manager, Amway Austria, for providing her expertise.

ACKNOWLEDGEMENTS

IMPRESSUM Published by: respACT – austrian business council for sustainable development, Herrengasse 6-8/6/1/3, 1010 Vienna,Austria; and the Austrian Federal Economic Chamber, Economic Policy DepartmentEditors: Roman Mesicek, respACT; Lisa Weber, respACT; Annette Märk-Schlaisich, Hauska & PartnerDesign: Martin Lachmair, Creativedirector.cc Lachmair Gmbh (www.creativedirector.cc)English translation: Cara Michelle MorrisProduced in Vienna, AustriaCopies can be ordered by contacting:[email protected].: +43 (0)1/710 10 [email protected].: +43 (0)590 900 4279Vienna, September 2010Printed by: gugler* cross media

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A Guide to Corporate Social Responsibility for One-Person Enterprises