SMEs and CSR: a realistic proposition?

Madhavi Bhatt
Project Coordinator, SMEs
CSR Europe

As the European Multi Stakeholder Forum on CSR gathers momentum, it is only natural that attention should turn to addressing how the majority of businesses in Europe - SMEs - are dealing with corporate social responsibility (CSR).

From this perspective the question is not so much whether it is realistic to expect SMEs to take on the CSR agenda but rather how responsible business practices - based on economic, social and environmental considerations - are being integrated into the core activities and strategies of Europe's SMEs.

A realistic approach to SMEs and social responsibility needs first and foremost to be grounded in reality. That means acknowledging and valuing current practices: SMEs are already actively addressing economic, social and environmental issues on a daily basis. Contrary to larger companies SMEs do not publicise or label these activities as being CSR. The challenge for policy makers and the broader business community lies in finding collaborative ways in which to strengthen, help to improve and support SMEs in their current practices.

Neither a lobbying organisation nor a trade association, CSR Europe concentrates its activities on facilitating dialogue and implementing actions.

In line with this approach, CSR Europe is already developing actions to support SMEs and make sure that the business community values their activities. CSR Europe already has experience in tackling supply chain issue through its human rights programme. However, the initiative for SMEs rightly places the supply chain as one of a series of issues facing SMEs.

The SME Key and its host website (www.smekey.org/) provides SMEs with an insight into the business case for placing social and environmental as well as economic considerations at the heart of their strategies. Additionally, SMEs can use the SME Key: an on-line guide being developed in a series of languages -English, French, Italian, Finnish, Dutch, Greek and Spanish- that helps SMEs to take stock of their current activities and better plan future activities. Since its launch in July, the SME Key has shown that there is a demand for tools and space to be dedicated to the question of SMEs and responsible business practices. The site is currently attracts 4,000 visits per month with about 300 downloads of the guide.

CSR Europe intends to boost these actions through a series of strategic alliances with key reference actors for SMEs and in the field of responsible business at European and national level to expand the scope of activities by including training and awareness raising and contributing to further research into SMEs and responsible business practices.

The European Multi Stakeholder Forum on CSR has made fostering CSR among SMEs one of the four themes to be explored by the Forum until the end of its remit in June 2004. Through a series of roundtables on SMEs the Forum will explore the following aspects of fostering CSR among SMEs:

• Building the business case for SMEs
• Awareness raising and spreading good practice, exploring possible incentives for the further uptake of CSR by SMEs
• Cooperation between large companies and SMEs (include supply chain issues)

Prior to the launch of the Forum, the European Commission had already started a range of activities addressing the issue of SMEs and responsible business. A survey on "SMEs and social and environmental responsibility" published last year by the EC, provided valuable insight into the practices of Europe's SMEs. 50% of SMEs interviewed said that they were already engaged in responsible business activities. DG Enterprise has also organised a working group of national experts on SMEs and responsible entrepreneurship and are collecting case studies of good practice in SMEs across Europe.

In terms of what else the EU could be doing to support SMEs in responsible business, the approach undertaken is a welcome one. Raising awareness, exchange of good practice and support measures, facilitating dialogue with stakeholders and exploring ways of building capacity are all vital components to strengthening the role of SMEs in embedding responsible business practices in businesses of all sizes.

That said, more in-depth research across Europe into SMEs and responsible business practices is necessary and it is a positive step that through the 6th Framework programme of DG Research and Development, mechanisms are being made available to involve SMEs in research and development activities. Importantly, there is also scope to conduct research on the role that SMEs have to play in helping the EU to meet its 2010 goal of becoming the most competitive and dynamic, knowledge-based economy in the world, one that is capable of sustaining economic growth and social cohesion.

The steps taken to actively involve SMEs in the CSR debate are timely, necessary and welcome. Whatever concerted efforts will develop it is clear that an understanding of CSR from a specific SME point of view is necessary to further engage and ensure that the issue remains relevant to SMEs who, as the majority of businesses in Europe, provide the innovation and entrepreneurial drive that give an economy the leading edge

For more information, please contact:

CSR Europe

info@csreurope.org

tel: +32 2 541 16 10

www.csreurope.org

www.smekey.org