Industrial action to measure and improve corporate responsibility's ...

Industrial action to measure and improve corporate responsibility’s results:
theoretical and practical arguments.
Rafael Tello
Luana Dapieve
Luisa Valentim
Cláudio Boechat
The capacity of corporate responsibility practices to improve companies’ competitive
performance is not very clear, although research projects have found correlation between
them at different levels. The main problem is to determine the causality, which usually can be
recognized only in case studies.
At the business level, many case studies have concluded that a more responsible management
based on dialogue with stakeholders can improve company competitiveness (FAHI, ROCHE
and WEINER, 2005). That is so because answering and recognizing the stakeholders’
necessities can strengthen the relationship between them and the company, foreseeing risks
and opportunities for the company in its sector. As by-products, firms can enhance efficiency
and productivity.
On the national level, in 2005 an initiative of both, the London-based NGO AccountAbility
and Brazilian business school Fundação Dom Cabral, was to measure the relationship
between responsible practices and environment and the competitiveness of countries/nations
(ACCOUNTABILITY and FUNDAÇÃO DOM CABRAL, 2005). It was the second version
of the Responsible Competitiveness Report with improved indexes to analyze that
relationship. The statistical changes on the National Responsible Competitiveness Index and
the Responsible Competitiveness Index made them more robust and trustful. Even with the
changes, once again a strong correlation was found – more than 80% – between the
responsible practices and the competitive economic levels of the countries
(ACCOUNTABILITY and FUNDAÇÃO DOM CABRAL, 2005). It was found that many
countries have a strong performance inequality between these two parameters. This suggests
that despite the capacity of corporate responsibility to foster economic results of companies, it
does not spread to the national competitiveness environment naturally. In other words, it
could mean that responsible business practices are not being properly explored in achieving
higher levels of competitiveness in each country. Some good examples are China, United
Arab Emirates, Algeria and Tunisia.
This paper proposes the use of coordinated industrial action to spread the results of each
firm’s responsible practices to other companies in its sector. This kind of organization is
recommended because companies have similar stakeholders but different management
systems (HUNT, 1999) which make benchmarking and networks possible and easier to do.
Many business associations already collect data from their associates and publish the results
to the wider public. But, until today, the capacity of these institutions is much underestimated
(HÄMÄLÄINEN, 2003). Once they have access to information from the whole industry they
can easily find best practices in the industry and coordinate benchmarking initiatives.
Additionally, these associations are quite able to identify general weaknesses among their
associates and therefore are able to propose mature projects to coordinate combined efforts of
companies, government, universities and/or international institutions to solve those and thus,
broaden the positive effects of responsible practices.

In Brazil many associations have already organized information about responsible practices
and results of their associates. This action has two main effects: (1) they inform their
stakeholders and the society how the companies are performing and, what results they
produce; (2) stimulate other companies to set out responsible practices and monitor their
actions and results. These results can already help institutions, managers and governments to
evaluate the impact caused by these companies as responsible agents. Undoubtedly these
results can be improved not only if the associations recognize their potential, but also when
they adopt the appropriate tools to find and spread best practices and to coordinate industrial
responsible activities.
Despite the positive effects of isolated sectorial actions to improve the responsible
performance of the industries, to developing countries the real benefits depend on the
simultaneous improvement of their competitiveness. So, it is quite important that the
associations are able to develop their capacity of coordination. They can build up the
programs to implement the responsible competitiveness of their members and finally, turn
them into real promoters of the sustainable development.
In order to validate such assumptions, we will present actions done by Brazilian associations
that improved the responsible practices of their associates, and brought about broad results to
the sector as a whole. It may help other companies, in Brazil or abroad, to build up their own
programs.
COMPETITIVENESS AND CSR AT THE BUSINESS LEVEL
Competitiveness is a concept originally developed to observe and compare the performance of
companies or sectors (HÄMÄLÄINEN, 2003; KRUGMAN, 1994; KUPFER, 1991; LALL,
2001). Authors claimed that firms obtained competitiveness by reducing prices or enhancing
productivity (PORTER, 1990). The study of companies’ ability to improve their performance
was neglected with the dominance of the neoclassical research in economics. Since the perfect
competition theory is a pillar of neoclassical economics, it was impossible for companies to
differentiate themselves and reap higher profits in a sector (HUNT, 1999).
Researches about companies’ capacity to gain competitiveness continued in many fields:
evolutionary economics, Heterogeneous demand theory, historical tradition, Resource-based
tradition, Competence-based tradition, etc. The authors observed, in different ways, that
companies were not homogeneous and that their paths of development were distinct (HUNT,
1999). This indicates that companies could organize themselves and act in unique ways,
obtaining different performances or competitiveness. The inclusion of path-dependency on the
analysis avoids the tendency to equilibrium, so companies could build long lasting
competitive advantages.
According to Porter (2006) some of the sources of these advantages are innovative capability,
strategy, quality of products and processes. These sources are internal to the company, but it
is embedded in a region (city, state, country, etc). So, the firm depends on many institutional
aspects provided by the region’s land, society and government, and these factors impact on
their competitiveness (WEF, 2006; IMD, 2006). Companies’ activities have impacts on their
regions and elsewhere, because of the globalization. This new scenario highlighted
competitive issues, especially with the rise of China and India, whose companies are gaining
market share at high pace through the exploration of cheap resources.

The conducts of companies and their consequences to society is one of the themes on the
competitiveness debate. Many developed countries are concerned with the effect of China and
India’s growth in their economies. Their argument to protect domestic companies is based on
accusations of bad economic behavior (inadequate working conditions, pollution, disrespect
of international treaties, etc) of Asian companies to reduce costs and offer cheaper prices to
consumers. In spite of protests of governments, the view that we support is that Asian
companies are providing cheaper products to the world, improving purchase power, obtaining
new consumers and pushing economic growth.
Global economy exposes the contradictory preferences of persons: as consumers they want
cheaper and better products, but as citizens they also want companies to respect their
stakeholders. Most companies are focusing in one objective, and the bigger ones are deciding
to improve financial results, cutting costs with reallocation of the production to developing
countries or firing many workers. Some recent examples are GM, Ford, Nike and even
Lenovo, a Chinese company.
In some ways it is possible to associate the development of cheaper and better products and
the improvement of the companies’ responsible behavior. This is a challenge for firms to
promote Sustainable Development (SCHALTEGGER et al, 2002). Some companies are
successful in achieving good results at both goals simultaneously, such as AEG group. That
for long times focused on the improvement of the efficiency of its products. These companies
are trying to satisfy this new consumer and consequently build competitive advantages that
may not result in higher performance today, but will become crucial to define leaders of
future markets (KUPFER, 1991). To summarize these changes, the International NGO
AccountAbility created in 2003 the concept Responsible Competitiveness (ZADEK et al,
2003). It was developed and in 2005 its definition was:
The Responsible Competitiveness means markets where businesses are
systematically and comprehensively rewarded for more responsible practices
and penalized for the converse. Strategies for realizing Responsible
Competitiveness aim to enhance productivity by shaping business strategies and
practices, and the context in which they operate, to take explicit account of their
social, economic and environmental impacts. (ACCOUNTABILITY; FUNDAÇÃO
DOM CABRAL, 2005, pg 8)
Some authors describe competitive benefits achieved with responsible behavior. Schaltegger
et alli (2002) affirm that companies that include in their strategy efforts to solve those issues
develop new business opportunities, such as development of new markets and new marketing
possibilities and reduction of production costs. Also, with a larger vision of their business and
challenges, firms improve their capacity to discover, evaluate and prevent risks. Scholars
interested in innovation also highlight the importance of a broader view to increase the
chances of an innovation becoming successful in the market (ADNER, 2006). Many real
examples are given by Fahi, Roche and Weiner (2005). In their book, one chapter presents
possible improvements that companies can gather with Corporate Social Responsibility (CSR)
and some real examples are used to illustrate it.
CSR seems to increase companies’ capacity to improve their competitiveness, maybe even
helping them differentiate themselves (BRUNO, 2006), increasing their perceived value to the
consumers. But does this capacity remain effective at the country level, once companies have
different management systems and strategies? How correlated are public and private

esponsibility to national competitiveness? Are regions with responsible companies and an
adequate institutional environment more competitive?
COMPETITIVENESS AND CSR AT NATIONAL LEVEL
The question of the relevance of the competition of countries is older than Adam Smith’s
seminal book “The Wealth of the Nations”. Heretofore, the mercantilism claimed that a
positive trade balance would make a country richer. Classical authors argued that human labor
was responsible for it, criticizing the promotion of exports and control of imports. One of
them was Ricardo, who developed the theory of comparative advantage. In his view trade
could improve the welfare of the countries, as long as they organize their production trying to
minimize opportunity costs of production (WALTER, 2005). The Ricardian view dominated
economic analysis of international trade.
The most famous criticism to it was done by Michael Porter (1990). His argument was based
on a dynamic approach, on the importance of absolute advantages, once international
resources were flexible, and on the evidence that societies (governments, companies, research
centres, etc) are capable of creating their advantages, regardless resources endowment
(PORTER, 2006; WALTER, 2006). Hämäläinen (2003) argues that competitive analysis is
extremely important because of its holistic perspective and its capacity to measure the
potential economic growth of a country in a global market (see HÄMÄLÄINEN, 2003,
chap.1). He points out that research tradition did not have anything that differentiates it from
other theories 1 , and he tries to overcome this weakness including the analysis of
organizational issues in his theory, defending that it is a major determinant of a country’s
competitiveness.
Nowadays people in different positions and countries are concerned with national
competitiveness, but what this means is unclear. The term is associated with economic
growth, welfare, prosperity, etc. 2 Although it is not a precise concept, the growth of national
competitiveness is a goal to governments of the USA and the European Union, which
developed competitive strategies and empowered institutions to realize them (WALTER,
2005; WEF, 2006). A broader range of elements that impact a country’s competitiveness
(IMD, 2006; WEF, 2006) imply that governments with a focus on competitive improvements
must not only consider economic variables, but also law, public institutions, education, health,
S&T, among others. 3
The broader view is an evolution on the analysis of the conditions of a country to create
wealth and support development, but it is not enough. The competitive view does not consider
many aspects connected to the sustainability of countries’ growth processes. So, it is
necessary to include new variables in present models or create new ones that allow the
observation of new aspects, adequate with long-lasting growth rates.
The first Responsible Competitiveness Report (ZADEK et al, 2003) tried to overcome this
problem integrating responsibility variables, aggregated in the National Corporate
Responsibility (NCRI). The NCRI was later connected to WEF’s Growth Competitiveness
Index (GCI), creating the Responsible Competitiveness Index (RCI). The main objectives of
1 For more details see Lall, 2001
2 Walter (2005) shows many concepts given by many institutions.
3 The IMD measure the competitiveness of the nations with 325 variables compiled in 4 pillars. The WEF uses
126 variables in 9 pillars.

the index were to check the relationship between CSR and competitiveness, and how intense
was it and what happened to the ranking of the WEF if responsibility was included in the
competitiveness index.
Fifty countries were studied and ranked. The results showed that there was a strong
correlation between CSR and competitiveness although in some countries the difference on
the performance was significant. This means that most countries had similar competitive and
responsible performance. Countries in different situation formed two groups. The first
included countries with competitive improvement but irresponsible practices, risking the
sustainability of the process and postponing part of the costs generated in the present. The
other group had better responsible practices than competitive performance, which means that
their companies were not able to build competitive advantages based on responsible practices
(ZADEK et al, 2003).
These were important conclusions, but statistical problems made them dubious. For this
reason, in 2005 AccountAbility and Brazilian Business School Fundação Dom Cabral
developed a second version of the index, with theoretical and statistical improvements
(ACCOUNTABILITY and FDC, 2005). The new index was built with hard data collected in
international institutions and with soft data of the Executive Opinion Survey, done by WEF
and achieved a sample of 83 countries.
Most of the changes were directed to improve the NCRI. It was completely rebuild. The new
index had three pillars instead of the seven from the previous version:
1. Internal Dimension: includes variables about proactive actions of CSR
2. External Dimension: includes variables of the pressure done by society and
government from where companies are settled
3. Environment: includes variables about efforts to preserve natural environment and its
results
The methodology of the RCI remained the same, with the NCRI being integrated into the
RCI. Only statistical methods changed, with the use of factorial analysis to aggregate the data
in pillars and to do RCI and the generation of regression expressions to estimate the
importance of each pillar on national responsible competitiveness. The statistical method also
defined the importance of each pillar in NCRI and RCI (ACCOUNTABILITY and FDC,
2005). 4
The argument of the importance of responsible competitiveness was more accurate because
the indexes had many statistical improvements to make it more robust, and though they
showed similar results to those found in the first report (ACCOUNTABILITY and FDC,
2005). The new report showed an 85% correlation (Annex 1).
The Table on Annex 1 shows the performance of African Countries on the study and other
countries with high performance gaps. The points under the curve are countries with better
competitiveness than responsibility results. The countries with greater disparities are the
USA, China, and United Arab Emirates. Africa, Tunisia, Morocco and Algeria are the
4 The regression for the National Corporate Responsibility Index was: NCRI = 0.35 F1 + 0.33 F2 + 0.27 F3,
where F1 refers to Internal Dimension, F2 to external dimension, and F3 to Environmental management.
The regression for the Responsible Competitiveness Index was: RCI = 0.35 X 1 + 0.32 X 2 + 0.19 X 3 + 0.15 X 4,
where X1 refers to the NCRI, X2 to Macro environment, X3 to Public Institutions, and X4 to Technology.

countries with the higher gaps. On the other side, the Philippines, Slovenia and Ireland are the
most representative countries of the World, and South Africa and Nigeria the African ones. 5
Despite its significant correlation, it is not able to determine a causality relationship,
something that would be possible, with econometrical analysis. In this article we will argue
and propose a proactive way that companies can organize themselves to improve their
responsible actions and in a second moment, become more competitive through these actions.
All the countries should improve their performance in social and environmental issues in
order to achieve a sustainable development (SCHALTEGGER et al, 2002). However, in this
article we focus our attention on those countries with high performance gap, because it is
easier to establish priorities and the strong and quick actions are needed to guarantee a
sustained growth process or the alignment of business processes and the responsible
environment.
BRIDGING THE GAP
National economic systems are more dynamic and complex with trade liberalization,
development of information and communication technologies and higher specialization of
companies and workers (HÄMÄLÄINEN, 2003). These are characteristics of the knowledge
or learning economy, where intangible goods are more relevant than tangible ones. In this
new scenario, information and the coordination capacity become extremely important to
businesses’, industries’ and countries’ development.
Following Hämäläinen’s (2003) arguments that the growth’s, trade’s and competitiveness’
authors did not analyze the static and dynamic organization of the resources in an economy,
because they follow the Smithian ‘invisible hand’ metaphor, and assume that the resources are
used in their maximal efficiency. In an always bigger and more complex and specialized
economy, the market (price) mechanism is not capable of organizing efficiently the
production, distribution and evolution of products and services. So, the author attributes to
organizational efficiency of an economic system the same importance as the quality of
resources, technologies and product market 6 .
The facts exposed earlier showed a correlation among responsible practices and companies’
and countries’ competitiveness. However, observing table 1, it is possible to see that some
countries are unable to extend the results from micro to macroenvironment. One of the
possible hypotheses for this problem is a lack of organizational efficiency in countries with
high performance gaps. In the Responsible Competitiveness Report (ACCOUNTABILITY
AND FDC, 2005) the authors raise a question related to this point is already:
5
28 countries of the sample showed a significant gap, 12 with a predominance of responsibility and 16 of
competitiveness.
6
The author points four kinds of organizational efficiencies:
1. Allocative efficiency – describes how well the resources are allocated in the economy.
2. Technical (X-)efficiency – describes the efficiency of workers and technologies used inside the
companies.
3. Coordination efficiency – describes the efficiency of the coordination of activities of the agents in a
economy, with the objective to get the higher aggregated revenue.
4. Dynamic efficiency – describes how well an economy develops its organizational efficiency in a
dynamic perspective.

(...) corporate responsibility to date has meant, low-level. Incremental
change for an important but relatively small proposition of the
business community. (…) The question is how can business working
with others, get beyond the constraining first mover disadvantages and
prisoners’ dilemmas in shaping markets to support a broader, deeper
responsible competitiveness? (ACCOUNTABILITY and FDC, 2005.
pg 40)
Another problem for a society that wants to organize itself is to expand practices and spread
good results: which organizational alternative to use. Hämäläinen (2003) presents a brief
exposition of Coase’s work. This author created the concepts of transactional and
management costs when he tried to determine the reason of the transactions being realized in
the market, inside a company or through government actions. He considers them alternative
forms of organization, used according to the cost involved in the transaction
(HÄMÄLÄINEN, 2003).
Hämäläinen (2003) recognizes the importance and precision of Coase’s conclusions, but
points out three other forms of organizations, that were not important or did not exist at the
time, but are relevant in the present economic systems. The first is the supranational
institutions, which have had increased power with stronger economic and political
international integration. Since our perspective is national these institutions will not be
considered here. The other two forms are non-profit organizations – which some call nongovernmental
organizations – and companies’ networks. These organizations developed and
became more relevant with the new techno economic paradigm, because inter alia the
knowledge is more complex and spread among different agents, the higher pace of
technological development, of the increase of the competition, and the appearance of new
social and environmental issues. These kinds of organizational forms are very flexible and can
be used in many different fields and situations, so they can be placed between market
transactions and internal transactions in a company or between the later and governmental
transactions (HÄMÄLÄINEN, 2003).
In the Responsible Competitiveness Report (ACCOUNTABILITY AND FDC, 2005), it is
argued that the “bridge” to take companies’ results to national level is the exploitation of
clusters, where the main company would influence its suppliers and clients to adopt more
responsible practices. In Brazil, it is difficult to rely on this kind of cooperation, because there
are few clusters in the country. Even collaborations in supply chains are not a major practice.
In a survey done by Mendonça, Viana and Resende (2006) with big companies in the biggest
Brazilian supply chains showed that only 34% of the companies said they have collaborative
practices and 26% did not plan to collaborate. Because the establishment of a partnership
involves a long process of cognitive and working practices’ adjustment, and mutual
confidence building, it would take a long time to adjust the environment to make cluster
collaboration works. In countries where business relationships are similar to Brazilian ones,
organization through clusters may have less chance to be successful.
Another difficulty of using clusters to expand responsible results is the considerable
differences among the companies that form them. Companies in a cluster sell different
products, have different sizes and deal with different stakeholders. This is very good to
stimulate plurality, but reduces the capacity of the main company to help the other ones,
because problems, agents involved and resources are different. The applicability of past
experiences is also small.

In our point of view an industrial approach would have much more success. The Responsible
Competitiveness Report (ACCOUNTABILITY AND FDC, 2005: 115) recommends the
formulation of sector-based strategies, to create tools of implementation and measurement of
impacts. Even being for cluster organization, AccountAbility Recognizes the importance of
industrial focus and action.
In Brazil many competing companies unite themselves in associations to represent their
interests with the government and to work together to solve problems or develop themes of
their interest. Since one association represent many companies, it is possible to influence a
high percentage of the national GDP involving few agents, what facilitates organization and
planning. 7
The first argument in favor of that is institutional. The industry associations were formed by
mutual efforts of competitors, to achieve similar goals. On one hand, the costs to organize
companies are reduced, once the association already exists. On the other hand, the working
groups and association’s management are done by people of different companies, creating
confidence among individuals that improve capacity of collaboration.
The second favorable argument refers to learning capacity. Many associates are competitors,
which mean they buy from similar suppliers, use similar productive processes, and sell similar
products to similar clients. Despite of all these similarities, they have different managerial
systems with different focuses (HUNT, 1999). It is possible to conclude that competitors have
very similar stakeholders, but different actions to deal with them. So it is ideal to do
benchmarking inside the industry. We conclude that if associations act proactively they can
select best practices and stimulate experience exchanges that increase chances of successful
actions implementation, and reduce costs of planning.
Associations are responsible for collecting companies’ data and it is a place for discussions
and mutual work. These characteristics make associations a good place to find common
problems faced by companies. Once again the similarity of companies increases the chance of
equal perception of the problem by different associates. So, another possibility for
associations to increase companies’ competitiveness is by proactive organizations of network
projects, which can include other partners, such as government, NGOs and international
institutions to contribute with important resources such as money, know how, and technology
(HÄMÄLAINEN, 2003).
So we argue that countries with a gap between competitiveness and responsible performance
should use industrial organization to reduce it. Especially in countries with low levels of
business collaboration, where the exploration of the supply chain may not be the already
existing institutions should be used more effectively and efficiently.
BRAZILIAN INDUSTRIAL REAL EXAMPLES
In Brazil, some industrial sectors have used companies associations to spread the culture of
CSR and to promote the sustainable development of this area. The organizations join
companies that are interested in developing themselves and being distinguished in the market
7 For example: food producers’ association represents companies that are responsible for 9% of the Brazilian
GDP. Chemical industries’ and machinery and equipment producers’ associations represent 4% each.

in a competitive and constructive way for their sector. They offer a series of services that used
to be done internally and now tend to be executed by a cooperative and associative form,
resulting in reduction of the costs of each company.
The Brazilian chemical industry has ABIQUIM – Associação Brasileira da Indústria Química
(Brazilian Chemical Industry Association) – with the function of propagating the sustainable
development. The associated companies are not only looking to be recognized for
contributing to the environment preservation, but they also want to take financial advantage
for themselves. Some results expected by companies are: improvement of the quality of their
products, income and jobs creation, and reduction of financial and material resources in the
production.
In 1992, the “Atuação Responsável” Program (the Brazilian version of the Responsible Care
Program) was created by ABIQUIM. The focus of this program is:
"To supply to the Brazilian chemical industry and to the workers of the sector the
knowledge and the tools to face better the complex changes dictated for new
requirements of a society worried in creating and fortifying for the bases the
sustainable development."
(ROLHO, Atuação Responsável Program)
The “Atuação Responsável” Report 2006 (Brazilian Responsible Care Annual Report) brings
important information about the 104 companies who had been part of the research. They had
informed that in 2005 the investments on environment had reached R$181,240,894.00 and the
R$156,055,735.00 expenditures for 40,828,775 tons per year as production. The investments
in health and security of the worker had also been great in 2005, R$ 31,188,593.00, it has
done a significant improvement in the accident indexes with this preventive politics.
Investment within the good management of the resources showed that these expenses had
compensated according to the economy that it got in the production.
Saved resources Expenses 2004 Expenses 2005 Saved money in coparison
with 2004
Water R$ 7,50/t R$ 5,00/t R$2,50/t
Lauching of
effluents
Energy (fossil fuel) R$ 1,00/t
R$ 40 milhões
Eletric energy R$ 1,30/t
R$ 52 milhões
Source: Adapted from “Atuação Responsável” Report 2006
3,05m 3 /t 2,75m 3 /t R$0,40/t
R$ 16.413.248,00
The Program “Atuação Responsável” of ABIQUIM is an example of how an industrial
association organizes the industry’s data, stimulates companies to act with responsibility and
communicate the improvements to all. Companies are satisfied with the results. The industry
gains with these actions, because it informs the stakeholders of the actions taken. Companies
can benefit from free advertisement and better resource allocation in responsible practices
avoiding double expenses and opening opportunities to collaboration. Other associations also
follow this strategy, as, for example, ABRE – Associação Brasileira de Embalagem (Brazilian
Association of Packaging), ABIT – Associação Brasileira da Indústria Têxtil e Confecção
(Brazilian Textile and Apparel Industry Association), ABIMAQ – Associação Brasileira da

Indústria e Máquinas e Equipamentos (Brazilian Association of Industrial Machines and
Equipment) – and others.
ABIQUIM also organized a handbook to orient companies to organize their surrounding
communities. This was done after their associates’ complaints of the difficulties to understand
the claims of their neighbors. The association discovered that companies had better
relationship with the inhabitants when negotiations were done with a community council that
represents them. So ABIQUIM put together successful practices and advises to build these
councils in a handbook directed to their associates. Companies were benefited with a faster
and better solution to solve their problems. They also improved their dialogue’s capacity,
what could end up improving their responsibility.
In the industry of paper and pulp a similar scene is observed with the participation of the
BRACELPA – Associação Brasileira de Celulose e Papel (Brazilian Cellulose and Paper
Association) – as conducer. The Socio-Environmental Report 2005, launched by the
BRACELPA, shows a research carried out with 36 companies, 85% of the salable production
of pulp and paper in Brazil. It presents pointers that give a clear idea of the commitment of the
sector with the sustainable development. The participant companies had told that, in 2005,
they had invested the following values:
Payments R$ 1,6 bilion
Workers participation in the results R$ 119 milions
Transport R$ 58,8 milions
Direct Jobs Feeding R$ 110,7 milions
Trainigs and campaings (occupational health) R$ 36,3 milions
Doctor assistence R$ 123,1 milions
Professional education R$ 38,8 milions
Environment preservation area (2,6 milions he) R$ 916,5 milions
Comunities actions
Source: Adapted from “Socio-Environmental” Report 2005
R$ 11,3 milions
More than divulging the general data of the sector’s companies who participated in the
research, BRACELPA also makes public the social performances of each associated
company. The role of associates is exposed in the document “2005 Pulp and Paper Industry
Social Responsibility Report”. In it, the association highlights successful initiatives
companies’ responsible policies and social actions.
In general, the mining sector in Brazil invested U$ 1.06 billion in environment from 1994 to
2004 and intends to invest more than U$ 189 million every year between 2005 and 2010
according to the IBS – Instituto Brasileiro de Siderurgia (Brazilian Steel Institute), the
association of the industry. In IBS’s website, companies can show their practices in
technological, financial and responsible fields. The largest national mining companies have
great social projects which are accessible through the IBS website.
CONCLUSION
This paper tried to show some evidences that CSR and competitive performance can be
achieved together and that the first can stimulate the last. The Responsible Competitiveness
researches showed that many countries were not successful in the two fields simultaneously.

The literature review was done not to discover the roots of the problem, but to raise an
alternative solution to the countries that face it. Institutional economics’ and competitiveness’
literature helped us building this proposal, the real examples support our beliefs, but applied
researches are still necessary to validate these conclusions.
The analysis of the business environment’s organization can raise new issues to researchers
and policymakers dedicated to find solutions to improve competitive and responsible
performance of companies. Our main conclusions are that these solutions should vary
according to the economic activities’ organization and that industrial organization may result
in better results for companies because it allows easier benchmarking and network projects.
We suggest that countries with weaker productive chain collaboration tradition should prefer
this solution and explore existing institutions that involve leaders and workers of different
companies to improve collaborative inclination and reduce costs to organize the agents.
Although much has been already done, there is still much to be done in Brazil to improve the
power of responsible actions to raise the competitiveness of the companies. But today many
stakeholders have access to robust and organized industrial data. Companies already know
what is done by its competitors, and since this field is not considered strategic, it can result in
exchange of experiences and collaboration.
Organization can increase the pace of dissemination of responsible actions through industry
and improve their quality in consequence of continuous learning and knowledge exchanging.
However, organization of companies does not occur naturally, it must be done by rational
agents. In Brazil we believe that associations are good institutions to do that because of its
formation and trust is higher inside it. Other countries should study their institutional
environment and find the most appropriate organization to put companies together and
stimulate coordinated and collective plans and actions.
Other countries can use Brazilian examples to create their own solutions to improve
themselves responsibly and economically. But it is important, first of all to understand their
own characteristics in order to define the better way to stimulate knowledge exchange and
cooperation among companies, NGOs and government. It is important that the readers
understand that our propose is not to suppress other solution possibilities, but to offer another
alternative to countries with different economic organizations that need to find cheap and
quick actions to offer to their populations higher economic, social and environmental revenue.

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Source: Authors’ elaboration
ANNEX 1: Growth Competitiveness Index X National Corporate Responsibility Index