The new entrepreneurs: for many companies, tackling tough social issues is all in a day's work.Corporate social responsibility, the fashionable management mandate to keep company goals in line with social issues, has gone beyond writing a check to charity or backing a corporate foundation for the tax benefit. Companies are beginning to realize that there is money to be made on social causes--tackling education, technology access and housing--while applying business models to the problem. Result: Real progress, and money to the bottom line. For the fourth year in a row, LATIN TRADE Latin Trade is a monthly magazine covering global business in Latin America and the Caribbean. Similar to Forbes and Fortune Magazine in coverage, the magazine was founded in 1993 and now publishes 87,000 copies 1 each month in Spanish, Portuguese, and English. asked hundreds of companies in the region to explain their corporate social responsibility policies in detail. Three hundred and forty three businesses replied, of all shapes and sizes. Of those, 40% reported annual sales of more than US$1 billion, while a third of them were small, posting revenues of less than $10 million. Interestingly, 56% of the respondents In the context of marketing research, a representative sample drawn from a larger population of people from whom information is collected and used to develop or confirm marketing strategy. said corporate social responsibility is "integral to their business model." So we set out to understand what companies meant by that. Sapotek, a small Mexican Mexican named after or originating in Mexico. Mexican axolotl see ambystomamexicanum. Mexican beaded lizard (Heloderma horridum technology firm, has invented an online desktop computer. For a small $60 fee or for free in many cases, users can draft documents, download To receive a file transmitted over a network. In any communications session, "download" means receive, and "upload" means send. The download/upload often implies a big/little scenario, in which data is being downloaded from the "big" server into the "little" user's computer. their favorite songs and even run their own personal Web sites. The company hopes to expand its revenue base by allowing distributors to sell its services to businesses and to launch an English 1. English - (Obsolete) The source code for a program, which may be in any language, as opposed to the linkable or executable binary produced from it by a compiler. The idea behind the term is that to a real hacker, a program written in his favourite programming language is version in the United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. soon, says company founder Oscar Mondragon Mondragon can refer to:
The business model is straightforward, born out of a problem that is not uncommon across Latin America Latin America, the Spanish-speaking, Portuguese-speaking, and French-speaking countries (except Canada) of North America, South America, Central America, and the West Indies. : not enough access to the digital world and all the economic and social resources that implies. Most people in Mexico Mexico, city, Mexico Mexico or Mexico City, Span. Ciudad de México (Méjico), city (1990 pop. 8,236,960; 1991 met. area est. 20,899,000), central Mexico, capital and largest city of Mexico. don't have computers in their homes, but they do have access to the Web at nearby cyber (1) From "cybernetics," it is a prefix attached to everyday words to add a computer, electronic or online connotation. The term is similar to "virtual," but the latter is used more frequently. See virtual. cafes, at work or at school. Users don't need hardware to enjoy the benefits of having their own personal computer, just type in a username The name you use to identify yourself when logging into a computer system or online service. Both a username (user ID) and a password are required. In an Internet e-mail address, the username is the left part before the @ sign. For example, KARENB is the username in karenb@mycompany. and password on any computer in the world, and there's your digital life. "The company was born with the mission of closing the digital divide by creating applications available to anybody regardless of their socio-economic class Noun 1. socio-economic class - people having the same social, economic, or educational status; "the working class"; "an emerging professional class" social class, stratum, class or education" says Mondragon. "In places such as Mexico, there is no installed base for hardware." Today, the company's less than 20 employees serve more than 85,000 users. It continues to expand; executives expect to post $2 million in sales for 2006. The company says users are able to avoid spending lots of money renewing software and buying new computers, or simply resorting to purchasing gray-market computers. "It's a basic desktop that anyone can use," says Pablo A. Magana, Sapotek's general director. Larger companies are in on the trend, too. Homex, a Mexican homebuilder, has developments in 26 cities throughout the country. Most are marketed to lower-income families. Mexican law requires developers to set aside 10% of the land in a project to go to the municipality MUNICIPALITY. The body of officers, taken collectively, belonging to a city, who are appointed to manage its affairs and defend its interests. . Homex, however, pitched a different idea: Instead of giving the land over to wait for the local governments to decide what to do with it, Homex offered to go ahead and develop schools, daycare centers, parks and other services. Homex says doing so is good for the homebuyers, good for the city and good for the company's bottom line. "By doing that we provide a benefit for clients. They don't have to leave the development to get the kids to school; it helps moms that work to have a daycare facility;' says Carlos Moctezuma, head of Homex investor relations Investor relations The process by which the corporation communicates with its investors. . At the same time, the municipality does not have to decide what to do with the land. A private company instead develops socially beneficial infrastructure. Homex gains an edge: The services, already in place, can convince homebuyers to choose Homex. "It's a good marketing tool," Moctezuma says. Homex's corporate social responsibilities don't end with clients. The company sees value in its own employees. All 7,000 workers are fully employed, nearly unheard of Not heard of; of which there are no tidings. Unknown to fame; obscure. - Glanvill. See also: Unheard Unheard in the construction industry, where outsourcing (1) Contracting with outside consultants, software houses or service bureaus to perform systems analysis, programming and datacenter operations. Contrast with insourcing. See netsourcing, ASP, SSP and facilities management. and subcontracting is normal. Homex makes worker contributions to Infonavit, the state-owned mortgage lender, with the aim of turning blue-collar workers blue-collar worker n → obrero/a blue-collar worker n → ouvrier/ère col bleu blue-collar worker n → into homeowners--and future customers. It also provides primary and secondary education to workers who need it, right on the construction site. Mexico's National Institute for Adult Education provides the teachers and Homex sets aside space on the site for classes. The company ends work a little early for employees who want to study, Moctezuma says. Loyalty. Obviously, costs rise with such measures, but Homex executives feel that customer and employee loyalty will lead to more business. "It is a cost that most companies in the world should face," Moctezuma says. Making money out of solving problems is taking Homex to new markets. Earlier this year, the company signed a deal with Mexican real-estate brokers Biesa and Confi Mexicana to sell houses to Mexicans living in the United States. The two companies are licensed realtors in both Mexico and the United States Relations between the United States and Mexico are among the most important and complex that each nation maintains. They are shaped by a mixture of mutual interests, shared problems, and growing interdependence. , the latter of which is home to millions of Mexican nationals who send billions of dollars home every year. The deal will facilitate mortgages to Mexicans living in the United States looking to buy Homex houses back in Mexico. Homex also worked out an agreement with Instituto Mexicano para el Equipamiento de la Vivienda, an association of Mexican furniture and domestic appliance domestic appliance domestic n → appareil ménager makers, which creates financing packages for Homex customers to buy furnished fur·nish tr.v. fur·nished, fur·nish·ing, fur·nish·es 1. To equip with what is needed, especially to provide furniture for. 2. homes. Financial institutions are in on the trend. Citigroup issued $2.9 million in grants across Latin America and the Caribbean, to turn people running informal businesses in their homes into real small businesses. Grants aside, the company's education initiatives aim to provide business savvy to the region's youth. Begun a decade ago in Argentina, Banks in Action is a contest designed to teach fundamentals of finance to high-school seniors in a contest by letting them assume the role of a banker. Teams decide on lending terms and setting interest rates on different instruments and even how much to spend on marketing to drum up business. Each year, winning teams from across Latin America meet in one city where the finalists go for the top prize. The Brazilian team won in 2005, earning $1,000. The idea, however, is to educate. Now that the program has expanded to include 17 Latin American countries List of American countries Nations:
Study beyond the level of secondary education. Institutions of higher education include not only colleges and universities but also professional schools in such fields as law, theology, medicine, business, music, and art. or are headed straight into the work force, but all need more knowledge of finance. "They already have skills and we refine them;' says Rodriguez. Doing so improves the economy, she says, which is good for the banking sector. Human capital is the key to the success of any economy, since a more educated populace makes better consumers. While governments do what they can to improve education, the private sector is taking it on, too. For Cisco, more tech-savvy people is good for both the company and the markets it serves, say executives at the networking giant. Since 1997, the Cisco Networking Academy The Cisco Networking Academies, part of Cisco Systems, offer networking courses, like the CCNA and CCNP courses, which prepare students for the certification exams of the same name, and other computer-related courses. Program has been training students in conjunction with universities and other public-sector entities to get more people familiar with the Internet Internet Publicly accessible computer network connecting many smaller networks from around the world. It grew out of a U.S. Defense Department program called ARPANET (Advanced Research Projects Agency Network), established in 1969 with connections between computers at the and information technology in general. The program allows students to design and maintain data networks via the Web. Narrowing the digital divide is key to developing an economy, says Marco Cobb, who runs the program for Latin America. Seven hundred and fifty-six institutions, from high schools to universities--even housing developments--are involved in the Cisco program that has educated more than 68,000 Latin American students in 25 countries throughout the region. Worldwide, the academy covers 167 countries, including highly indebted in·debt·ed adj. Morally, socially, or legally obligated to another; beholden. [Middle English endetted, from Old French endette, past participle of endetter, to oblige poor countries. "The best way wasn't with equipment but with our knowledge and skill with Internet and information technology," Cobb says. The idea is not necessarily to create future Cisco employees but rather to close the digital divide, he says. U.S. computer giant Dell rose to become a household name by making computers to order through an on-demand, low-cost assembly model, thus cutting inventories and ultimately, the cost of buying technology. In a similar vein, executives say, improving education around the world will improve economies and ultimately, the need for computers. In Brazil, tax incentives are available to companies that invest in research and development, mainly outfits that manufacture technology products like Dell. The company set up a research laboratory at the Pontificia Universidade Catolica, a university, to tackle company-specific issues. To help both students and the company, Dell began to train students there to develop software for in-house In-house In the context of general equities, keeping an activity within the firm. For example, rather than go to the marketplace and sell a security for a client to anyone, an attempt is made to find a buyer to complete the transaction with the firm. uses. The center grew into a full-fledged Dell outfit OUTFIT. An allowance made by the government of the United States to a minister plenipotentiary, or charge des affaires, on going from the United States to any foreign country. 2. that continues to create jobs today. "It was a great success, and with it, we decided to grow," says Fernando Loureiro, public affairs director for Dell Brazil. The Brazil service center was the first one abroad for the company. Others popped up in Russia and in India, working with those in the United States. "It not only solved our problem by creating technicians but it also served as an attraction for a school for kids who really wanted a technical background" says Terry Kahler, vice president for operations and services for Dell Latin America. Dell also donated do·nate v. do·nat·ed, do·nat·ing, do·nates v.tr. To present as a gift to a fund or cause; contribute. v.intr. To make a contribution to a fund or cause. $1 million in equipment and hardware to the Universidade Federal de Rio do Grande do Sul state. The company even flew professors to the United States to turn them into experts on Dell's products. Today, students there have access to technology they didn't have previously by becoming Dell Certified See certification. System Engineers. Dell hires some of the students and also offers internships, although most go on and get jobs elsewhere. A more educated workforce means more demand for its business. Low-tech. Then there's the low-tech problem of throwing out the trash. Many companies want new computers but what do you do with the old ones? Tossing toss v. tossed, toss·ing, toss·es v.tr. 1. To throw lightly or casually or with a sudden slight jerk: tossed the shirt on the floor. See Synonyms at throw. them out is not good for the environment. Dell will come and haul off old equipment. It will recycle re·cy·cle tr.v. re·cy·cled, re·cy·cling, re·cy·cles 1. To put or pass through a cycle again, as for further treatment. 2. To start a different cycle in. 3. a. what it can and properly dispose of dis·pose v. dis·posed, dis·pos·ing, dis·pos·es v.tr. 1. To place or set in a particular order; arrange. 2. the rest. Even better, it makes accounting easier. "It's built into the price. We're going to quote you a price that includes all of this" says Kahler. "The business advantage of that is a single point of accountability. You don't have to call three people to make the machine, to install the machine, and take the old machines away. You call one person and get one invoice An itemized statement or written account of goods sent to a purchaser or consignee by a vendor that indicates the quantity and price of each piece of merchandise shipped. A consular invoice is one used in foreign trade. ." No matter what industry a company may operate, there is more business to be made selling to lower-income families than perhaps any other, says Valeria Budinich, vice president of Ashoka, an organization that provides fellowships to what it calls "social entrepreneurs A social entrepreneur is an entrepreneur who works to increase social capital, often by founding humanitarian organizations. Historical examples of leading social entrepreneurs
The explosion in the number of non-governmental organizations “NGO” redirects here. For other uses, see NGO (disambiguation). A non-governmental organization (NGO) is a legally constituted organization created by private persons or organizations with no participation or representation of any government. in recent years shows that social organizations are no longer confined con·fine v. con·fined, con·fin·ing, con·fines v.tr. 1. To keep within bounds; restrict: Please confine your remarks to the issues at hand. See Synonyms at limit. to church groups or temporary disaster-relief organizations. They have become sophisticated groups that create markets for business. For example, one farmer working on a hectare hectare (hĕk`târ, –tär), abbr. ha, unit of area in the metric system, equal to 10,000 sq m, or about 2.47 acres. or two of land might not attract distributors for irrigation irrigation, in agriculture, artificial watering of the land. Although used chiefly in regions with annual rainfall of less than 20 in. (51 cm), it is also used in wetter areas to grow certain crops, e.g., rice. equipment, but thousands of them might, says Budinich, referring to one of Ashoka's projects in Latin America. Businesses should reach out and find out where such markets are to be found, and non-government organizations might have the answer. "This has sparked a series of innovations of how to serve low-income families." Reaching Out Education and children remain the biggest benefactors of corporate largesse lar·gess also lar·gesse n. 1. a. Liberality in bestowing gifts, especially in a lofty or condescending manner. b. Money or gifts bestowed. 2. Generosity of spirit or attitude. in Latin America. How long has the company practiced corporate social responsibility? less than one year 12% one to three years 22% four to six years 18% more than seven years 48% SOURCE: LATIN TRADE Note: Table made from bar graph. How does the company practice the giving side of corporate social responsibility? corporate charity 59% product/service donation 54% employee community service 52% scholarship/training programs 50% employee donations to charity 47% partnership with charities 37% pro-bono work 31% corporate grants to non-profits 29% company foundation 27% non-governmental organizations 27% small business outreach 19% matching grants to employee donations 18% other 13% SOURCE: LATIN TRADE Note: Table made from bar graph. What proportion of its revenues does the company spend in percent on corporate social programs? 0.1%-0.5% 44% 0.51%-1.0% 19% 1.1%-2.0% 16% 2.1%-3.0% 6% over 3% 15% SOURCE: LATIN TRADE Note: Table made from bar graph. What is the company's focus in corporate social responsibility? education 69% children 50% environment 44% health 39% community development 38% poverty 37% arts, culture 34% natural disaster relief 34% women 21% elderly 18% housing 12% digital inclusion 11% other 10% human rights 10% disease research 8% SOURCE: LATIN TRADE Note: Table made from bar graph. Responsibilities Top management plays an increasing role, but human resources The fancy word for "people." The human resources department within an organization, years ago known as the "personnel department," manages the administrative aspects of the employees. departments are still a big driver of business values policies. Who is directly responsible for meeting corporate social responsibility goals in your company? CEO 42% board 32% human resources 31% vice presidents 22% cross-functional CSR team 21% management committee 21% middle managers 19% communications/public affairs 17% corporate foundation 16% employees 13% CSR director 11% no one is in charge 8% external organization 6% other 4% SOURCE: LATIN TRADE Note: Table made from bar graph. Are executives compensated for performance on meeting social goals of the company? yes 29% no 71% SOURCE: LATIN TRADE Note: Table made from pie chart. If so, how are they compensated? bonus 16% awards 16% none 14% non-cash benefits 9% promotion 8% salary increase 6% additional titles 3% stock 3% pension benefit 2% other 1% SOURCE: LATIN TRADE Note: Table made from bar graph. Why does your company engage in corporate social responsibility activities? motivate employees 58% integral to business model 56% public image/marketing 50% customers expect it 29% board expects it 27% competitive advantage 25% improves government relations 23% investors expect it 22% internal management image 20% sales tool 13% other 10% SOURCE: LATIN TRADE Note: Table made from bar graph. Tracking Success Knowing who among your employees and partners is responsible matters as much as understanding the impact of business-values decisions.
Is corporate social responsibility becoming common in Latin
America?
becoming the stand 9%
increasing so among all companies 42%
still a new concept 35%
mainly practiced by multinationals 14%
Note: Table made from pie chart.
How does the company evaluate the impact of its social
programs or aid on the community?
no measurement 43%
quantitative analysis 33%
"social" balance reporting 27%
independent external analysis 16%
standard social responsibility measures 11%
other 6%
software 5%
Note: Table made from bar graph.
What controls does your company use to meet corporate social
responsibility goals?
published code of ethics 60%
employee guidelines 42%
management guidelines 37%
periodic employee training 36%
ethics code reviewed by directors 31%
periodic management training 27%
supplier guidelines 24%
periodic supplier training 13%
other 7%
Note: Table made from bar graph.
Does your company require suppliers and partners to meet
corporate social responsibility standards?
yes 35%
No 65%
Note: Table made from pie chart.
SOURCE: LATIN TRADE
Hiring Well Benefits and transparent hiring are the keys to finding responsible people.
What level of benefits do your employees enjoy?
health insurance 81%
paid vacation 75%
training 71%
life insurance 67%
sick leave 53%
leisure time 49%
educational assistance 48%
flexible work hours 42%
transportation assistance 42%
short-term disability 42%
preferential credit terms 41%
dental, vision insurance 39%
long-term disability 37%
on-site facilities 36%
maternity/paternity leave 35%
corporate pension plan 30%
medical discounts 29%
private pension (corp. match) 27%
family aid 21%
other 7%
Note: Table made from bar graph.
How transparent is your hiring process?
job descriptions 67%
company-wide internal postings 61%
hiring done by human resources 58%
public notice of positions 48%
salary ranges are identified 47%
independent searches for executives 41%
hiring office open to the public 39%
Note: Table made from bar graph.
What are the company's annual sales in U.S. dollars?
less than $10 million 33%
$10 million to $50 million 10%
$50 million to $100 million 7%
$100 million to $1 billion 11%
$1 billion to $5 billion 12%
$5 billion to $10 billion 8%
more than $10 billion 19%
Note: Table made from bar graph.
SOURCE: LATIN TRADE.
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