1. Sustainability and CSR Strategies in German Companies
SITRA- Sustainable Economy
Forum Excursion
Berlin, November 6th, 2012
Dr. Esther Hoffmann,
IÖW – Institute for Ecological
Economy Research, Berlin

2. Content
1. Background: Institute for Ecological Economy (IÖW)
2. CSR and Sustainability Management
a. Definition
b. Developments & Trends
c. Drivers
3. IÖW/future Ranking of Sustainability Reports
a. Goals
b. Evaluation Criteria
c. Characteristics of Good Reports
4. Positive and Negative Examples
5. Sustainable Economy
2

3. Institute for Ecological Economy Research
(IÖW) (1)
Private research institute
• Founded in 1985
• Leading scientific institute in the field of practice-oriented
sustainability research
• Approx. 35 employees
• Interdisciplinary scientists
• Clients and sponsors: mainly public sector (German Ministries,
EU, UNEP), also private foundations, NGOs, companies)
• pursues the aim of making the economy more sustainable
• http://www.ioew.de/en/
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4. Institute for Ecological Economy Research
(IÖW) (2)
Topics
• Sustainable Corporate Governance
• Environmental Policy and Governance
• Climate and Energy
• Products and Consumption
• Water and Land Management
• Innovation and Technology
• Environmental Services
• Evaluation and Assessment
• Participation and Communication
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5. Institute for Ecological Economy Research
(IÖW) (3)
Topic Sustainable Corporate Governance:
• Sustainability Management & Corporate Social Responsibility
(CSR)
• Sustainability communications
• Sustainable supply chains
• Sustainable market and product development
• Social Entrepreneurship
• Corporate adaptation to climate change
• Water Stewardship in business
• Accompanying research: evaluation, monitoring
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6. Sustainability Management and Corporate
Social Responsibility

7. The Term „Corporate Social Responsibility
(CSR)“
• refers to the socially responsible management of businesses in
the interest of their internal and external stakeholders
• encompasses the socially and ecologically sustainable shaping of
all phases of value creation which the company is able to
influence
• extends beyond legal requirements in the form of voluntary
commitment
• aims to create added value both commercially and socially
• as such represents the company‟s contribution to sustainable
development
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8. Sustainability Management or CSR?
• German companies have a long tradition in environmental
protection and environmental management
• Labor unions are traditionally strong and traditional social aspects
are well established
• Environmental management systems have been enlarged to
sustainability management in the early 2000ies
• Subsequently, the term CSR entered the German debate
• Companies with long tradition rather use the term sustainability
management
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9. Developments in Sustainability and CSR
Strategies
• In the 90ies: focus on environmental issues in production and
environmental management
• In the early 2000ies
• combination of environmental and social issues
• Increasing relevance of product-related aspects and
innovation processes
• During the last years:
• Materiality analyses and stakeholder integration
• Strategic relevance of sustainability
• Climate change dominates other environmental issues
• Demographic change as driver for social aspects
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• Supply chain and international responsibility

10. Current Challenges in Sustainability
Management / CSR
• Responsible supply chain management
• Business Case for Sustainability (company perspective)
• Creating societal value (stakeholder perspective)
• Shared value creation
• Integrating sustainability in the core business
• Sustainable product and service innovations
• Environmental issues: biodiversity, water stewardship,
resource efficiency
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11. Drivers for CSR or Sustainability Management
• Financial Market
• Sustainability Ratings, Carbon Disclosure Project, DVFA (Society of
Investment Professionals in Germany)
• Reputational Risks
• Financial Pressure
• Energy prices, Carbon prices (Emissions Trading), Resource prices and
scarcity
• Demographic Change
• Attractive workplace
• Increasing Standardization
• GRI, Global Compact, German Sustainability Codex etc.
• In some markets: market pressure through customers or competitors
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12. Stakeholder Groups
Employees
security of
employment, income
opportunities, working
conditions, career Neighbouring
Suppliers options, image community at Location
possibilities of supply and noise
delivery, conditions of pollution, emissions, volume
supply, delivery and of traffic, environmental
payment, solvency hazards, jobs
Customers Companies Shareholders,
range of
services/products, environme
Creditors, Banks,
ntal impact/ Insurances
friendliness, social conditions assets, return on
of production, general capital, investment
conditions, quality risks, liquidation value
Authorities Competition
abidance of laws and strategic
regulations, quality of plans, competitive
management, tax strategies, benchmarking
honesty
12
Clausen et al. (2001): The INEM Sustainability Reporting Guide, Berlin, p. 15.

13. IÖW/future Ranking of Sustainability
Reports

14. The IÖW/future-Ranking of Sustainability
Reports
• Regular, criteria-based, transparent evaluation
• of content and communicative quality
• of sustainability and CR reports
• of Germany„s 150 largest companies and of SMEs
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15. The IÖW/future-Ranking of Sustainability
Reports: Development
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16. Aims of the IÖW/future-Ranking of
Sustainability Reports
• support discourse on sustainability requirements
• provide guidance for companies and stakeholder
• promote competition among sustainability reports
• foster improvements in sustainability reporting
• initiate learning
• provide transparency on non-reporters
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17. Ranking Criteria
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18. Good Reporters…
• report equally on social and environmental aspects
• show integration of sustainability into overall corporate strategy and
give an overview on relevant management systems
• derive fields of action and comprehensive objectives based on branch and
company specific challenges and comment on achievements and
advancements
• discuss openly critical questions and conflicts
• provide a comprehensive data base, illustrate and interpret trends
• provide information on internal and external performance assessments
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19. Positive and Negative Examples

20. CSR Neumarkter Lammsbräu (SME) (1)
Company Description:
organic brewery residing in Neumarkt Oberpfalz
founded in 1628, since 1800 family enterprise
since 1987 raw materials from organic farming
since 1996 all 14 beers produced in a organic way
main products: organic beers, non-alcohol beers,
gluten-free beers , organic soft drinks, organic Soda
around 100 employees
first brewery which received the German
Environmental Award
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21. CSR Neumarkter Lamsbräu (SME) 2
Environmental aspects:
• high ecological standards (local sourcing, raw materials from
organic farming, beer sold only in reusable containers and
bottles, organic products)
Social aspects:
• communicative / participatory management style
• tutor program for new employees
• health management system
Responsibility in the supply chain:
• Long-standing relationships with suppliers and long-term high
purchase prices
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22. CSR BMW Group (1)
Company Description:
Bayerische Motoren Werke AG (BMW; English:
Bavarian Motor Works), headquartered in Munich,
Germany
motorcycle and engine manufacturing company
also owns and produces the Mini brand and parent
company of Rolls-Royce Motor Cars
In 2010, the BMW group produced 1,481,253
automobiles and 112,271 motorcycles across all its
brands
In 2011 revenue € 4.9 billion. Sales rose to € 68.8
billion, about 95,000 employees worldwide
Newsweek Green Ranking Top 500 Companies: ranks
22
30th globally, 4th in Germany

23. CSR BMW Group (2)
Environmental aspects:
• high share of recycling materials
• almost wastewater free production processes
• fuel-efficient and emission-reducing technologies
• electric / hybrid models, alternative drive concepts
• Alternative mobility concepts
Social aspects:
• profit sharing, increase of wages if company is successful
• flexible work schedules, individual working time account different forms of
part-time working models, sabbaticals, retirement programs
• high employee participation
• coaching for future female leaders; Network "Women leaders in dialogue”
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24. CSR BMW Group (3)
Responsibility in the supply chain:
• partners that respect the ILO, the UN Global Compact, the
OECD Guidelines and the ICC Charter sustainability
requirements
• Training and support, if requirements for the suppliers are not
reached
• Qualification Process (annually about 200 supplier), with main
suppliers of times a year "Supplier Performance Review"
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25. CSR Deutsche Bank (1)
Company Description:
German global banking and financial services
company with its headquarters in Frankfurt, Germany
more than 100,000 employees in over 70 countries
in 2009, Deutsche Bank was the largest foreign
exchange dealer in the world with a market share of
21 percent
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26. CSR Deutsche Bank (2)
• The whole banking branch is lacking behind in sustainability
topics
• Sustainability only partly integrated in investment criteria
• Sustainable or green investment only a niche
• Learning from or critical reflection of financial crisis not
observable
• Focus of CSR activities has for a long time been on Corporate
Citizenship, Sponsoring
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27. Sustainable Economy

28. Companies’ Role in Improving a
Sustainable Economy
• companies are a central player:
• they shape markets and needs (innovation processes and
marketing)
• through lobbying they influence policy-making
• They hence have a large responsibility and opportunities to
contribute to a development towards a sustainable economy
• Companies should develop and sell products for real societal
needs
• So far, only a small share of German companies does fulfill these
expectations
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29. Sustainable Economy
• Globally fair distribution of resources, income and profits
• Respecting boundaries of natural systems
• Efficient resource and energy use
• High rates of renewable energies and resources
• Low emission rates
• Changes in consumption patterns (sufficiency, reduced resource
use, increase in shared usage, slower innovation cycles)
• Other than economic values as success criteria (not only growth
rates, profits, GDP but quality, happiness etc.)
• Other types of companies (Social Entrepreneurs, cooperatives,
collectives)
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30. Thank you.
Dr. Esther Hoffmann,
IÖW – Institute for Ecological
Economy Research, Berlin
esther.hoffmann@ioew.de
November 6th, 2012