research@hec - Issue #37 - (Page 6)

CSR/SD research hec Sustainable development: how is it managed in CAC 40 companies? © Biais Jean Marc HEC Paris Sustainable development raises great hope for companies. It is a breeding-ground for innovations of the next decade, a source of change in business models, and a lever for economic growth. But what is it really? To understand how companies incorporate the topic in their internal management and resulting benefits, Diane-Laure Arjaliès and Julia Mundy studied the management of corporate social responsibility (CSR) / sustainable development (SD) in CAC 40 companies. B iography CSR gives companies legitimacy, improves their image, and unites employees. But how can it be implemented from an operational standpoint? How has management control taken on the topic? The study of Diane-Laure Arjaliès and Julia Mundy shows that multinational CAC 40 companies have all incorporated CSR / SD in their internal control processes. They have established indicators, which take into account these issues in relationships with affiliates and subcontractors, and anticipate future legislation on CO2 emissions and pollution reduction. A graduate of ESSEC business school with a Ph.D. in management control (which earned her the European PRI-FIR, EDAMBA, and EFMD Emerald awards), Diane-Laure Arjaliès is professor in the department of accounting and management control at HEC Paris. Her research is focused on the introduction of nonfinancial performance measures in accounting and management control systems and, in particular, on the development of socially responsible investment in asset management CO2 emission management in the fields of chemistry and construction. 6 * m a r c h - a P r i l CSR / SD: A RISK APPROACH In management control, CSR and SD are first understood as risks. The logic: it is the natural approach of management control (and internal processes). So for multinational CAC 40 companies, it is first about complying with new norms and meeting legislative requirements. They are, above all, constraints to be managed. For example, for many companies, the prospect of the carbon tax represents an additional cost; it is thus difficult for a cement manufacturer to see it as means of innovation. The consideration of SD and ethics concepts creates new risks for these multinationals, insofar as extra-financial factors may now have a strong impact on performance. This situation, depending on how it is experienced, can both inhibit innovation and drive change. 2014 PROCESSES FOR SEIZING CSR / SD INNOVATION OPPORTUNITIES Internal control processes. Because they foster communication, reporting, identification of threats and opportunities, and thus innovation, they can support the achievement of CSR / SD objectives, as shown by the researchers. And CAC 40 companies are careful to not miss growth opportunities that may arise from CSR / SD. They encourage working groups on the topic, implement online collaboration tools, and develop bottom-up interactive processes, with freedom of expression within certain boundaries established by management. However, for the time being, these initiatives have not led to significant innovations in all areas of activity and no CAC 40 company has renewed its strategy thanks to sustainable development. In reality, these multinational, publicly listed companies already have so many short-term financial restrictions that it is certainly more difficult for them than for others (smaller and/or not publicly listed) to take full advantage. VARIED APPROACHES BUT STILL LIMITED EFFECTIVENESS Classification as an industrial / service company has little impact on the ability to innovate through sustainable development, the researchers observed (however, some industries enable it more than others). In terms

Table of Contents for the Digital Edition of research@hec - Issue #37

Cover & Contents
Do Grandes Ecoles entrance exams for France’s reinforce the gender gap?
Creative processes: negotiating technological innovations with success
Sustainable development: how is it managed in CAC 40 companies?

research@hec - Issue #37