research@hec - Issue #28 - (Page 6)

CSR research hec Responsible financing You don’t have to be a star to play a major role What if social and environmental issues are given greater voice via targeted financing, even on a small scale? A study of the French film industry carried out by Rodolphe Durand and Julien Jourdan shows that a minority participation of investors with an unconventional logic can significantly change the market. Rodolphe Durand B IOGRAPHY Rodolphe Durand joined HEC Paris in 2004. With an MSc and doctorate from HEC and an MPhil from Sorbonne, Rodolphe Durand is also qualified to supervise research work (at Université Lyon III). Founder of the Research Centre for Society and Organizations at HEC, he also holds the GDFSuez chair at HEC Paris, where he coordinates the Department of Strategy and directs the MSc in Strategic Management at the Grande Ecole. Rodolphe Durand and his co-author focused on the French film industry, where two modes of thought exist side-by-side: the traditional mode revolving around co-financing by the French government with a standard pattern of distribution; and a mode that is closer to the world of financial markets and their multiple, openly-stated profitability targets. The latter is based on the participation of SOFICAs (Companies for Financing the Film and Audio-Visual Industries), which are accredited by the French Ministry of Culture and provide investment funds specializing in films and audio-visual work. As these companies are accountable to market investors, they may present filmmakers with demands that conflict with the entrenched values and goals that are largely shared by more traditional investors. Rodolphe Durand explains: “The French film industry makes an interesting setting for analyzing the way organizations respond concretely to the demands of minority investors, in so far as SOFICAs provided between 7 and 12% of the total investments made over the period we studied (bearing in mind that producers are not obliged to apply for the funds).” can be explained by the resources committed by SOFICAs. According to Rodolphe Durand: “The financing structure of film-makers has an influence on how production teams position their films. When they accept money from SOFICAs, they are more inclined to meet the expectations of market logic. More generally, this shows that the companies are faced with market structures that are more complicated than is often thought when analyzing how they perform”. According to Rodolphe Durand and Julien Jourdan, the minority participation of resource providers with an unconventional logic (SOFICAs in this instance) results in what they call an “alternative conformity” – hence the reference in their article’s title to the film by François Truffaut, Jules et Jim, in which two friends are in love with the same woman. As Durand explains, “When an organization responds favorably to a minority financial participation, it leads to a decrease in the influence of the major players, alters the social structure of the resource providers, and promotes new forms of interaction. All this makes alternative conformity a ‘soft’ control strategy for organizations.” SUPPORTING ROLES ARE MORE THAN EXTRAS The authors’ work shows that the number of films released across multiple cinemas is far higher than SOCIAL ISSUES COME INTO PLAY VIA MEDIATORS More generally, confrontation between organizations and companies, especially in terms of incom- 6 • August-September 2012

Table of Contents for the Digital Edition of research@hec - Issue #28

Cover & Contents
Public health: How to encourage people to have a healthier lifestyle
“Double jeopardy”: How the market penalizes the poorest
Responsible financing: You don’t have to be a star to play a major role

research@hec - Issue #28