Corporate Social Responsibility and the Strengthening of Civil Society in Brazil

Mario Aquino Alves 3Mario Aquino Alves, Professor at FGV/EAESP and Associate Dean for the PhD Program in Public Policy, continues with a third focus on Brazil and the political concept of CSR in developing civil society

Opening up the understanding of politics

Brazilian business culture is deeply marked by an aversion to political action, which is usually assumed in a narrow sense, i.e., party negotiations, conspiracies, and agreements with parliamentarians and members of the executive.

Accordingly, politics would mean entering the tortuous fields of patronage and paternalism that are potentially the gateway to misdeeds and criminal activity. Recent corruption scandals that were recently revealed to the public during large-scale police investigations like Lava Jato (big contractors and construction companies bribing public officials and politicians) and Zelotes (companies bribing public officials for tax evasion) might well have reinforced this understanding. Thus, the stereotype of the involvement of business and politics in society is lobbying and corruption.

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Consider this as politics

However, the Brazilian business community should try to understand politics more broadly. There are different forms of political action that affect the public. These actions may or may not be linked to a government and may or may not be held by it. Thus, the adoption of ethical standards, the environmental certification of companies, the formation of a residents’ association, negotiating during protests and boycotts, trading ethically responsible products, stakeholder negotiations, and many other practices can also be considered political activities.

The structural and technological changes of the last thirty years have expanded the scope and performance of the business environment. Moreover, in this new global context, companies currently have a political and social role that goes far beyond the minimum legal requirements. As such, one of the ways that businesses can engage in political action is through Corporate Social Responsibility (CSR), either directly by companies or indirectly through their institutes and corporate foundations.

A little pressure leads to great incentive

Institutional and economic pressures have justified the growing involvement of companies in numerous areas of public interest. On the one hand, many of the incentives for the social performance of companies result from consumer pressures, the awareness of responsible investors, shareholders driven by new moral imperatives, and the threat of NGOs and social movements who understand the potential risks that can damage the reputation of companies. On the other hand, there are incentives for social responsibility activities that come from the market itself: acting responsibly became a market niche that may be attractive to some companies, but not all. Through Corporate Social Responsibility, for example, companies go far beyond just meeting the expectations of society, by engaging directly in regulatory actions in the production of public goods.

When politics gains goodness

Council on Business & Society CSRA new concept of CSR is emerging which transcends those welfare actions or advertising initiatives, and able to add these new roles taken on by companies. This is a political concept that transcends an economic vision to which the actions of Corporate Social Responsibility are purely focused on creating value for companies, i.e. they only assume social responsibility activities if they maximize the value of the company in the long run.

It is therefore from this political concept of Corporate Social Responsibility that its role can be understood in the process of strengthening the Brazilian civic sphere.

Despite the democratization process already entering its third decade, Brazilian civil society is still weak. The early 1990s brought with it a great paradox: while the process of democratization of the institutions went underway, with a new constitution that established the participation and decentralization of public policies, Brazil was experiencing an unprecedented economic crisis, which enlarged the gap between rich and poor. In this period of increased social demands, state-sponsored social welfare programs functioned precariously or even disappeared. At that time, social movements and NGOs began to open up dialogue and even establish partnerships with the government (at all three levels of the federation), with businesses, and even with traditional mutual aid and assistance associations in order to fulfill social needs. It was the time of boom in the nonprofit sector and corporate social responsibility initiatives in Brazil.

Hard times, new impetus

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Okay, guys – time for a little impetus

However, in recent years, the decline of international cooperation, the problems linked to contracting with government bodies (due to heavy bureaucracy and institutional weakness), litigation issues with government contracts, and the long tradition of low civic and associative culture in Brazil, marked the need for new impetus for the development of a strong civil society, particularly in the context of civic engagement and local development.

In 2010, there were 290,000 nonprofit organizations in Brazil, according to FASFIL 2010 (IBGE, 2012). Of these, 42,463 organizations were involved with advocacy, and 33,172 concerned residents associations or community development. The vast majority of these organizations have extreme difficulty to survive, showing a local weakness in the development of civil society.

Between 2012 and 2013, the FGV/EAESP Center for Studies in Public Administration and Government (CEAPG), with the support of Alliance D3, developed a study on The Institutional Architecture of Support to Civil Society Organizations in Brazil, which not only pointed out these difficulties to survive, but also the possibilities for strengthening civil society. Among these possibilities, the study indicated that the private sector, especially large companies and their branches of private social investment, could provide resources for civil society organizations.

There are, however, institutional problems for companies to engage in activities to strengthen civil society. The Grupo de Institutos, Fundações e Empresas(GIFE), which brings together a hundred of the most important private investors in Brazil, showed that these same investors settled two billion reals in private social investment in 2011 (GIFE, 2013). However, these resources were mainly intended for their own projects with only a very small portion intended for civic engagement organizations, such as those of advocacy and community development.

How Brazilian business can help Brazilian society

flag and quoteWith the goal of developing civic engagement, it is contended that companies could make a significant contribution in two fields of activity: the training of community leaders and the development of the institutional capacity of community development organizations.

The training of leaders is essential for civil society and its organizations to gain greater credibility within local society. But building highly efficient organizations does not mean that they might lose their ideal match. Being more efficient means that their leaders can lead their organizations to create projects and programs that transform people and society positively. It means less concern with internal management problems and greater attention to civic activity.

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The Council on Business & Society Global Alliance is an ongoing international dialogue between six of the world’s leading business schools and an organiser of Forums focusing on issues at the crossroads of business and society – The Council Community helps bring together business leaders, academics, students and journalists from around the world. #CouncilonBusinessandSociety

 

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