Corporate Social Responsibility and Social Economy. A closer look on financial tools into the Italian Context
Chiara Civera, Giulia Musso
1. Mapping Corporate Social Responsibility: meanings and boundaries
The development and the range of meanings and implications of Corporate Social Responsibility are strictly linked to the wider range of societal, economic and environmental changes and challenges happening all over the world.
Talking about Corporate Social Responsibility (CSR) requires first of all mention some of the critical factors or phenomena which have been affecting attitudes and actions of individuals, corporates, communities and governments over the last decades.
Generally speaking, the process of globalization takes place overhead all the factors as a series of relevant changes linked – for instance – to the decrease in national and geographic boundaries and industries deregulation and privatization. But, most of all as factor which has contributed to greatly increase the effects of the most devastating financial and economic crisis since the Second World War.
Accordingly, it can be said that globalization has changed the world both geographically and concerning corporates’ structure and shape. Due to it “the context in which business operates is changing at an increasingly rapid pace. New stakeholders and different national legislations1 are putting new expectations on business and altering how the social, environmental and economic impacts should be optimally balanced in decision making” (Dahlsrud, 2008).
More specifically, five main factors can be identified which are strongly pushed by globalization and strongly lead corporates to CSR implementation.
First of all, due to the progressive exploitation of resources all over the world and to an increasing desire for growth without control connected to the process of globalization, this is often seen and defined as one of the most relevant causes of energy and environmental crises as well (Parmigiani, 2010).
Secondly, market shock and the economic and financial crisis starting in 2008 is pushing the largest developed countries one by one – notably those where the crisis originated – towards a more and more severe period of recession. The situation in developing countries is predicted to become worse and more instable, because of their reliance on developed ones (ILO and International Institute for Labour Studies, 2009).
As a consequence, new concerns about alternative ways of leading countries to recovery and conducting business both locally and abroad in response to ethical requirements emerge.
Thirdly, as far as the corporate world is concerned the shortening of product lifecycle (Sääksvuori and Immonen, 2008) and the over competition on the markets (Perrini and Tencati, 2008) imposes a greater pressure on innovation, which can be seen as a key to economic recovery and employment development as well (Business Europe, 2010) and a way of serving new potential clients previously unable to access some types of products or services (Johnson, 2010).
The direct consequence of this phenomenon is the forced re-design of processes, activities and business approaches (as well as the need of new skills for instance) by those companies aiming 1 The legislations companies should align with are mainly related to the environmental impact of their operations, products and processes; the quality which has to embrace the whole corporate management system, from the choice of suppliers and resources to the products or services final shape and features; the respect of human rights as basis within a human resources management system implementation which concerns the respect of ethical practices in hiring and treatment of employees. Each country has its own different legislation concerning these topics. Some of them are voluntary and some other compulsory. Voluntary International legislations or standards try to conform all the different applications of the national ones.
to build an innovation-oriented culture so to be able to face their competitors and turn their business successfully to new markets, which sometimes can be niches.
Furthermore, innovation is strictly related also to the development of information and communication technology, which is having a great impact on consumers’ behavior and public opinion (Perrini and Tencati, 2008). Since nowadays access to both companies and markets information is easier and more rapid for individuals than in the past, concepts like transparency and coherence in communicating and sharing adopted strategies and activities are required.
Eventually, the last factor to consider is globalization as an evolutionary process of human interaction (Tanahashi, 2010), which increases the range and growth of traditional stakeholders involvement and contributes to the emergence of new ones.
Therefore, traditional rules of finance and business need to be reviewed according to the mounting pressures of individuals involved in and affected by companies’ decisions and activities (Kuepfer and Papula, 2010).
On one hand, shareholder theory used to work as long as finance was the core concept of a flourishing economy in which profit was the merely goal at the expense of society wellbeing.
On the other hand, since 80s within the crisis of American public companies, a new approach regarding companies’ behavior towards community and their reference public replaced the previous shareholder theory2. Then, stakeholders satisfaction3 considers companies’ value creation as a process involving different actors at the same time with different repercussions: financial actors, investors, customers, suppliers, employees, governments, institutions and associations, mass media, political groups, shareholders and reference community.
According to the wide range of interests that companies need to be aware of, they are expected to implement a value creation process which aims at achieving commercial purposes (by selling goods and services in response to customers’ and market demand), economic and financial (by creating value for shareholders and financial actors through the increase in profit and market shares) and ethical and social objectives in response to the community and stakeholders new expectations.
This concept becomes stronger and more relevant to business relations as different types of crises (such as financial and economic, environmental and energy) occur.
Given these premises, why does CSR impose itself as the most popular and comprehensive response to these five challenges?
Corporate Social Responsibility takes shape as a new way of doing business and pushes companies to rethink about their role within the market but most of all within the community. CSR represents, in such a context, a new strategy which strengthens the traditional way in which companies conduct their business by combining economic and commercial dimensions of value creation to the ethical, social and environmental one.
2 According to the Nobel winning economist Milton Friedman’s article published in the New York Times Magazine “The social responsibility of firms is to increase its profits” in 1970 “Responsibility is to conduct the business in accordance with their [shareholder’s] desires, which generally will be to make as much money as possible while conforming to the basic rules of the society, both those embodied in law and those embodied in ethical custom.” This concept puts a different accent on responsibilities for companies, which are completely different from the ones we use nowadays. Friedman’s point of view takes into account corporations as instruments of the stockholders who own it. Accordingly, all the meanings and implications of CSR (including charitable giving or corporate philanthropy) are dependent on the individual stockholders instead of on the corporation itself, because “if the corporation makes a contribution, it prevents the individual stockholder form himself deciding how he should dispose of his funds”.
3 According to R. Edward Freeman, Andrew C. Wicks and Bidhan Parmar In “Stakeholder Theory and The Corporate Objective Revisited” in Organization Science Vol. 15, No.3 May-June 2004 pp.364-369, the focus of stakeholder theory is articulated in two main concepts which concern the purpose of the firm – seen as shared sense of the value it creates – and the responsibility of the management towards who have interests in the company’s activity – defined as relationships a corporate wants and needs to create with its stakeholders to deliver on their purpose. Responsibility in business has to face these different interests to work both economically and socially, in other words to be effectively sustainable. “Economic value is created by people who voluntary come together and cooperate to improve everyone’s circumstances”. This is a vision inspiring CSR as a way to achieve at the same time economic & financial, commercial and ethical & social value.
In this sense, CSR helps to foster sustainable development4 of business and communities5. Theoretical definitions going to be listed confirm the statement.
As far as the European framework is concerned, CSR is defined by European Commission as a “concept whereby companies integrate social and environmental concerns in their business operations and in their interactions with stakeholders on a voluntary basis” (European Commission, 2001)6.
Further, the ISO26000 new standard contributes to give CSR an international voice by deepening meanings and fundamental issues to be addressed by companies in CSR practical implementation. It aims at helping organizations to achieve the benefits of operating in a socially responsible manner more efficiently.
In particular, ISO260007 highlights the 7 core subjects to be followed in order to respect the standard: organizational governance, human rights, labour practices, the environment, fair operating practices, consumer issues, community involvement and development8.
Amongst the wide range of the acknowledged CSR definitions it will be reported the ones which describe better the concrete response to concerns and challenges mentioned before: i.e. environmental and energy crises, financial crisis, information and communication technology rapid development, strong and necessary focus on research and innovation, and increasing pressures from stakeholders.
Societal benefit is one the primary goals of a CSR strategy. In particular, the attention to
environmental issues ad ecology has increased a lot and can be more connected to the quality of
products themselves. Nowadays, whilst the fight against climate change remains at the highest level of societies’ priorities (Business Europe, 2010), the market requires a more secure access to energy through the diversification of sources and efficient consumption. Nuclear power, renewable energies, and other new technologies are essential to meet this challenge (Business Europe, 2010). Natural resources will become increasingly scarce and expensive (Werbach, 2009) and it necessarily will imply a more responsible use of them.
In the recent stock market crises, CSR can be a mean to overcome some of the fallout of the financial crisis by creating value for both shareholders and society. Companies are asked to “understand that their responsibility to investors means being accountable to the society and environment in which they operate” (Clinton, 2009). In this dimension, as long as “public scrutiny, governmental regulation and customer expectations intensify” (Lubin and Esty, 2010) CSR requires 4 Sustainable development stands for seeking to meet “the needs and aspirations of present generations without compromising the ability to meet those of future” (Bruntland Commission, 1987); the principles of sustainability in managing people, planet and reaching profit are generally knew as Triple Bottom Line principles. The term was coined by John Elkington in 1994.
5 It is interesting to underline the fact that “despite the effects of the financial crisis, a slow economy in much of the world and continuing inaction by political bodies, the level of business investments in sustainability activities has been steadily rising” and is expected to grow further in coming years. This is to testify how sustainability is really perceived as attitude that could lead to superior performance in business aligning to the stakeholders’ needs and expectations. Business and community wellbeing can no longer be seen as separate entities. For further information on how sustainability is working in corporates, see the report “First Look: The Second Annual Sustainability & Innovation Survey”, MIT Sloan Management Review, Winter 2011, Vol.52, No.2 by Knut Haanaes, Balu Balagopal, David Arthur, Ming Teck Kong, Ingrid Velken, Nina Kruschwitz, and Michael S. Hopkins.
6 In October 2011 the European Commission published a new policy on Corporate Social Responsibility defining it as “The responsibility of enterprises for their impacts on society”. It aims at maximizing the social impact enterprises have on their community by respecting applicable legislations and collective agreements and aims also at minimizing the typical voluntary implication mentioned in the previous CSR definition. Communication from the Commission to the European Parliament, the Council, the European Economic and Social Committee and The Committee of the Regions, Bruxelles, 25th of October 2011, 681 final COM, European Commission.
7 ISO (International Organization for Standardization) is the world’s largest developer and publisher of International Standards. ISO is a network of the national standards institutes of 163 countries, one member per country, with a Central Secretariat in Geneva, Switzerland, that coordinates the system. ISO is a non-governmental organization, which enables a consensus to be reached on solutions that meet both the requirements of business and the broader needs of society. See www.iso.org at the section “About ISO”.
transparency and accountability, which can be achieved through the implementation of documents, reports and certifications (e.g. sustainability report and international standards).
Moreover, the investment in community wellbeing can lead a corporate to meet tomorrow customers’ needs.
Obviously, in order to meet these needs more effectively companies are required to be very innovative in products, services and processes design. Innovative approaches to business can strongly involve responsibility and sustainability as new ways of operating: by combining the use of social, environmental and sustainability drivers to create new business models, new products, services, processes and market spaces (European Commission, 2008) organizations will reach superior performance among competitors.
Innovation-oriented culture is part of the Total Responsibility Management Theory (Gorenak and Bobek, 2010), highly interrelated to stakeholders’ theory9.
Therefore, a framework of CSR cannot disregard the stakeholders’ pressures in being comprehensive and coherent, since “CSR looks at how firms treat their stakeholders” (Neal and Cochran, 2008).
According to Perrini (2008), CSR is a very relevant and consistent part of a corporate strategy. Companies are starting to pay attention to stakeholders’ relationships and are striving to create cooperation and loyalty in order to reach objectives that include social value through CSR activities implementation.
On the basis of the theoretical meanings of Corporate Social Responsibility as responses to the current critical phenomena or factors, a new personal formulation of a wider definition of CSR will be given below.
Within the typical enterprises profit–oriented strategies and legal requirements, theoretically Corporate Social Responsibility seeks to go beyond the companies’ ordinary operations to become a cross-functioning management tool which aims at achieving long term goals by fostering voluntary corporates’ multi-stakeholders relationships.
In order to respond to these different internal and external interests and make CSR a concrete action to take, companies are asked to put efforts in:
- responding to the community new expectations and needs;
- products, services or processes continuous improvement through innovation and Total Quality Management implementation;
- environmental care (i.e. recycling, saving energy, using alternative sources of energy); - human resources engagement and commitment plus obviously the respect of human rights. Since all of these actions have to be coordinated and planned, CSR can be defined as a real or concrete strategy which needs to affect and modify the entire companies’ structure from the top decision to the bottom application and vice-versa from the bottom input and suggestions to the top implementation, through a virtuous circle process increasing value creation.
Evidence from the adopted CSR strategies needs to be proved by communicating companies’ responsible and ethical behaviour to both the current and potential stakeholders.
According to the definition given, CSR can be put in practice through a number of activities – called “CSR activities” – which will be grouped together under the name of “CSR dimensions”.
The “Scheme 1” hereinafter summarizes the re-classification of those activities in three main dimensions:
9 Total Responsibility Management is a consistent part of CSR strategy, insomuch as some authors claim it seeks even to go beyond CSR itself: “Managing responsibilities goes well beyond traditional ‘do good’ or discretionary activities associated with philanthropy and volunteerism, which are frequently termed ‘corporate social responsibility’ and sometimes associated with narrow definitions of corporate citizenship. In its broadest sense, responsibility management means taking corporate citizenship seriously as a core part of the way the company develops and implements its business model. In this broad sense, responsibility management focuses on managing corporate responsibilities, which involves managing stakeholder relationships and the companies’ impacts on stakeholders”. “What is Responsibility Management? And why bother?” Available in “Total Responsibility Management: The Manual”, Hardback, February 2007, pp. 9-25 by Sandra Waddock and Charles Bodwell.
Accountability: this dimension refers to how companies communicate and give evidence of their behaviour concerning different subjects such as quality, environment, occupational safety and health, human rights and social responsibility through the voluntary adoption of International Standards and Norms. Moreover, it includes the system of reporting on sustainable attitude and ethical principles. Corporate Philanthropy: it includes all the activities carried out in order to respond
to the community needs by supporting Third Sector projects of social interests. Of course, it might have different impacts depending on the spread of management and employees involvement and on the type of tools chosen to support good causes. In any case, if it is used to enhance competitive context, it could bring social and economic goals into alignment and improve a company’s long-term business prospects (Porter and Kramer, 2002).
Ethics and Sustainability: it is the dimension strictly linked to the combination of environmental, societal and ethical concerns in process, goods and services development by making the best use of Research and Development and Innovation as tools to make the difference into the competitive arena.
Scheme 1: Corporate Social Responsibility: Dimensions and Activities
Dimensions Accountability Corporate
Philanthropy Ethics and Sustainability
Activities - Sustainability and Social Reports
- Code of Ethics
- Norms and Standards implementation: o UNI EN ISO 9001:2008 on Quality Management System – Requirements o UNI EN ISO 14001 on Environmental Management Standard o OHSAS 18001 on Occupational Health and Safety Assessment Series o SA8000: Social Accountability and Human Rights - Cash and in kind supports - Sponsorships - Cause Related Marketing - Staff Involvement: payroll giving and volunteering - Corporate Foundations creation - Investments in specific projects in response to specific needs - Development and implementation of ethical products and services o Fair trade products o Ethical funds or investments o Micro finance o Eco and Environmental -friendly products - Sustainable processes: energy saving, recycling, searching for alternative energy sources and resources
- Policies and Rules
issued for certain types of stakeholders
- Supply chain and
employees
involvement in CSR tools adoption
o ISO 26000:2010 on Sustainable Development and Social Responsibility
Source: Personal Processing
After having mapped CSR in its meanings, boundaries and practical applications for corporates, the next paragraph is entirely dedicated to explore the Italian landscape in order to figure out how CSR is developed there and implemented also in comparison to the European context.
2. Exploring the Italian landscape: qualitative and quantitative analysis on CSR
In the last years Italy has consistently shown its interest towards CSR topics and practices both at an institutional level and corporate one. There are more and more companies which have been implementing into their business strategies and formal communication policies a particular attention to social and environmental topics, mostly linked to the effects that their activities might have on the reference market and community.
The research conducted by Errepi Comunicazione in collaboration with SWG (Orsi, 2008 and 2010) shows that 7 Italian companies out of 10 were investing their money in CSR and sustainable activities in 2009, despite the financial and economic downturn. This percentage goes up to 88% if considering corporates which are the biggest in revenues/profits and number of employees. Moreover, by comparing these data to those of the previous years a positive trend can be easily seen: in 2001 only 44% of the interviewed Italian companies declared to have invested in CSR activities and communication at that time.
As far as the amount spent in CSR is concerned, it has jumped from 110.000 euro per company spent in 2011 to 161.000 euro in 2009 (with a positive trend of 46%). The estimated value for 2010 is about 219.000 euro per company.
Amongst the companies most involved in investing in CSR, a common profile of them can be outlined: most of them are big corporates operating mainly into the banking, financial and insurance sector from the Centre regions of Italy (compared to 2007, most of them were operating in the North rather than in the Centre). A small difference in the composition of the most involved sectors or industries emerges from the research conducted by Fondazione Sodalitas. In 2008 they identified the manufacturing sector as the most active in social responsibility (21%), followed by services sector (16%) and financial and banking sector (15%) (Sodalitas Social Solution, 2008).
Concerning the supported areas in the field of CSR, it can be underlined that most of the companies keep focusing on the so-called “external dimension” of CSR, that is the one addressed to the reference communities. Initiatives of social solidarity and humanitarian support are placed at the top of the ranking (66% of the companies, versus 52,4% in 2007). 1 out of 3 of the interviewed companies are involved also in CSR internal activities, by adopting services aiming at improving employees’ work conditions (33,8%, there is a slight difference from 2007) (Orsi, 2008 and 2010). The “Figure 1” below gives a picture of the main results of the research.
Source: Social involvement in Italian companies. IV Report. Errepi Comunicazione
In this case, the data of 2008 emerging from the research conducted by Fondazione Sodalitas confirms the above. 51% of the CSR projects are addressed to issues concerning companies and community relationship (partnerships with non-profit organizations and cause related marketing initiatives). Environmental improvement is given a relevant attention (12%) according to the increasing relevance that this topic is gaining at an institutional and national level (Sodalitas Social Solution, 2008).
Eventually, 43% of the companies declare that one of the most important reasons limiting the general and complete development of social responsibility within them is the lack of both direct returns from CSR investments and management culture (31,1%).
But how do the Italian companies communicate their social responsibility and their own performances concerning sustainable activities? Taking into account the research conducted by KPMG in 2011 on CSR reporting system – and in particular the matrix they have drawn in order to map countries’ attitudes – Italy is placed into the ‘Leading the Pack’ quadrant, because of the quality of its CSR communication and maturity of the processes. “In the ‘Leading the Pack’ quadrant, the majority are European countries that have addressed CR and reporting for over a decade. Companies in these countries have demonstrated both strong communication and professionalism over time” (KPMG, 2011).
The “Figure 2” below reports the percentage of companies from 17 different countries all over the world reporting on their corporate social responsibility initiatives comparing the years 2008 (in green) and 2011 (in blue). The original research includes and analyzes 34 countries in total.
Fig. 2: Percentage of companies reporting on their corporate responsibility initiatives (2008-2011)
Source: KPMG International Survey of Corporate Responsibility Reporting 2011
According to above, in 2011, 74% of the Italian companies published the corporate responsibility report separated from the annual report or a CR report integrated to the annual one10. The percentage is surely representative of an ongoing and increasing attitude towards CRS communication, if compared with 59% in 2008 and only 31% in 2005. Nevertheless, as the 2011 Lundquist research shows, 30% of the major Italian companies are not giving evidence of their CSR activities neither on the website or in reports, while all the 100 biggest European companies are involved in this kind of communication11.
Another interesting figure emerges from the research conducted by Alti and Isvi (Altis and ISVI, 2006): 58,9% of the Italian companies do not have a formal CSR manager in their organizational chart and the management of social responsible activities is often addressed to people in charge of other functions (such as human resources, internal auditing, marketing and communication). 88,2% of the companies has chosen to entrust people already involved in other companies’ activities the task of carrying out CSR activities as well. Only 16,9% of the sample has its own full time CSR manager. From the data emerges how huge is the challenge for Italian companies who want to work in order to improve CSR management and make CSR be part of their whole strategy and policy.
These data seems to confirm what emerges from the “Primo Report su responsabilità sociale e competitività” [“First Report on social responsibility and competitiveness”] carried out by RGA (RGA, 2009), which shows that in Italy the concept of CSR is more related to the brand image rather than ethics. The interviewed Italian companies still see CSR as a mean of gaining reputation on the market instead of a way through which tangible benefits may be achieved, such as customers’ retention, increase in shareholders’ value and profitability as well (RGA, 2009). Consequently, when comparing Italy to other countries all over the world – which have already understood the real effects CSR implementation may have on their business – on 31 countries evaluated for responsible competitiveness, Italy is placed only 26th in the ranking.
If it is true that the crisis was mostly originated by the lack of ethics in business, it is necessary for Italian companies to start recognizing CSR as an essential strategy to be implemented 10 The sample is composed by the 100 biggest companies (considering their turnover) into the 22 involved countries. 11 The research considers how the major 50 Italian listed companies use their websites in order to communicate their efforts and performances in social and environmental fields, ethics, governance and relationships with stakeholders. The Italian ranking is part of a wider research which takes into account more than 220 European corporates, grouped together in 7 different rankings (Austria, Europe, Germany, Italy, North Countries, United Kingdom, Switzerland). The aim of CSR Online Awards research is to evaluate how companies communicate their CSR to the spectrum of stakeholders involved through the web and to promote the use of Internet as mean to foster sustainable development.
within the current business policy in order to survive and improve their competitiveness. This strategy is to foster innovation in both business models and companies’ culture to adapt them to the new economic context.
Accordingly, only a real and continuous effort on sustainability and responsibility can contribute to rebuild a relationship between corporates and society, which is based on loyalty. Furthermore, this can be a way to improve companies’ competitiveness and their economic performances as well. In other words, it could be a way of giving an ethical response back to the crisis.
On the basis of stakeholders’ theory, it is commonly accepted that all the relationships between stakeholders and corporate world need to be run through a strong commitment and loyalty. The statement is particular so in relation to the banking and financial corporate sector: these kind of institutions really need a stronger loyalty in building their relations, not only with clients but with the wider spectrum of indirect actors involved in investments and financing activities.
One of the main reason why banking and financial sectors need to gain more trust from the actors they talk to is mainly due to the role they have played within the current financial downturn. Since they have lost more in the value of their relations, they are now asked to demonstrate more than other players from different sectors that they behavior is strictly addressed to ethical and sustainable way of operating. It is not only a matter of implementing CSR policy, strategies and tools – which represent the basis for competing on the market in an efficient, effective and ethical manner – but also of communicating what they are carrying out concerning sustainability and ethics in order to prove that they are really meeting the expectations of both financial market – as requirements of transparency – and public and community involved – like accountability and philanthropy. This will lead them to gain superior performance in market shares (profit remains their first goal of course), trust and relations.
But, how does the Italian corporate banking sector tackle this challenging issue?
Unfortunately, there is yet a lack of official data and researches concerning Italian context helping us to answer the previous tricky question. However, it is possible to draw a general conclusion about their attitude towards CSR by analyzing methods of implementing and communicating sustainability and responsibility and tools adopted by an Italian banking Group which is seen and defined as benchmark in regards to the case in point.
Of course, the Group taken into account as benchmark in the field of CSR into the next paragraph should not be assessed in terms of statistical representativeness of the whole Italian financial and banking sector. Instead it aims to be broadly reflective of a behavior and attitude that other players in the same sector need to be striving for imitating – as the biggest and most well known Italian banking corporates are already doing.
3. Picture of CSR in Italian banking and financial sector: Intesa Sanpaolo Group as benchmark case study
In order to concretely figure out how Corporate Social Responsibility is put in practice within financial institutions in Italy, is has been chosen to analyze and deepen the case of an Italian Corporate Banking – Intesa Sanpaolo – which is the leader in Italy in all the business areas and is among the top banking groups in the Eurozone. Most of all, the choice has been driven by the fact that Intesa Sanpaolo Group is also recognized as one of the Italian benchmark Corporate Banking into the field of Corporate Social Responsibility implementation and application.
The number of awards on sustainability and related topics the Group has received during the last years gives evidence to its strategy and activities concerning CSR.
The Group’s efforts on social and environmental issues have been awarded by AIFIn (Associazione Italiana Financial Innovation) [Italian Association Financial Innovation] in November 2011. Intesa Sanpaolo has been placed second in two categories of awards:
- for “Social initiatives” thanks to the project “Prossima Terzo Valore” presented by Banca Prossima12 through which Third Sector Organizations (which are bank’s customers as well) can advertise on ad hoc website (Terzovalore.com) their social projects and initiatives and have the visibility which could allow them to obtain funds they need more easily;
- for “Environmental initiatives” thanks to the project “Il Gruppo Intesa Sanpaolo per l’Ambiente” [Intesa Sanpaolo Group for Environment] which groups together all the activities pursued by them in order to reduce direct environmental impacts.
Moreover, according to the Lundquist CSR Online Awards Italy 201113 - which aims at evaluating the quality and effectiveness of CSR communication strategy – Intesa Sanpaolo is up towards the top of the ranking, especially concerning the environmental issues. In particular, the research shows how much the Group has improved its capacity in communicating CSR on its website and reports publication. It has been awarded “Best Improver 2011” ranking 9th with a score of 71.5 on 100 and climbing the ranking by 11 places since the 2010 edition.
In June 2011 Intesa Sanpaolo received the HR Innovation Award, addressed to the most outstanding companies in innovating Human Resources management and development processes. It has been awarded thanks to the Training Department Activities with the goal of shifting the focus from the ability in delivering training to the capacity in designing and turning them into effective learning experiences.
Worthy of mention is the 2011 Family and Work Award in which the Group has received the highest award in the category “Best Integrated System of Conciliation”. Another first place in rankings has been also obtained for the “Innovation Award” in March 2011 thanks to the innovative initiatives taken by the Group in order to make the bank closer to its customers.
Among the many awards received, another important acknowledgment has to be reported: Intesa Sanpaolo is the first bank in Europe to become partner of the European Commission’s Sustainable Energy Europe Campaign, aiming to strengthen the cooperation in terms of energy saving and the promotion of renewable energies.
Basically, Intesa Sanpaolo Group has been awarded and acknowledged for its work into the most relevant areas of CSR.
The aim of the present paragraph is to figure out how and why the Group’s attitude to CSR can considerably represent a benchmark for other corporates operating into the same sector.
The case study has been developed through the analysis of the Group’s website dedicated to the area of sustainability and the website of Banca Prossima, of the reports they carry out and CSR tools they use (according to our CSR definition and scheme of activities and dimensions tools 12 Banca Prossima is part of the Intesa Sanpaolo Group and it is entirely dedicated to the Non-profit context. It has been created in order to respond more specifically to the Third Sector needs. More information about Banca Prossima will be after-written as concrete initiative of the Group’s ethical and sustainable products and services development. 13 The study carried out by Lundquist (a company specialized in corporate communication on the Web) has analyzed how the 50 largest Italian listed companies communicate – through the corporate’s website – their strategy and performance of CSR. The ranking is part of a wider research that has examined more than 220 companies in Europe and assigns Intesa Sanpaolo 8th position.
include codes, norms and standards adherence, corporate philanthropy activities such as partnerships and ethical and sustainable services development). Moreover, more specific and useful information on CSR attitude and implementation came out from the interview with Dr. Anna Monticelli working for Corporate Social Responsibility Unit at Intesa Sanpaolo.
The Group was created on January 1, 2007 through the merger of two leading Italian banking corporates: Banca Intesa and Sanpaolo IMI.
The merger gave these two major Italian banks more opportunities to grow and supported significantly the development of businesses and the country as well.
Nowadays the Group is the leader in Italy in retail, corporate and wealth management – through a network of 5,600 branches – and holds a competitive and top position among banks in the Eurozone with a market capitalization of 21.0 billion euro.
Intesa Sanpaolo Group operates locally and abroad through different subsidiaries which are grouped together in five main organizational areas reporting to the Heads Office Departments: Public Finance, Corporate and Investment Banking Division, Banca dei Territori Division, International Subsidiaries Banks Division, Other group subsidiaries.
In particular, Banca dei Territori Division includes Intesa Sanpaolo bank, many other local banks operating in different regions and cities throughout Italy and Banca Prossima – the one entirely dedicated to the Third Sector development, investment and financing.
All the banks and institutions which are part of the Group adhere to the same mission, values and beliefs.
Before introducing practical CSR tools used by Intesa Sanpaolo to implement and prove its responsible and sustainable behavior, a general overview on its theoretical attitude towards the topics will be given in order to discover which are the main pillars and strategies that play a crucial role in forming a strong and formal CSR culture shared and recognized by the whole Group.
The word “sustainable” is totally part of the Group mission which consists in promoting “a
style of growth that is attentive to sustainable results and the creation of a process based on the trust deriving from customers and shareholder satisfaction, a sense of belonging on the part of our employees and close monitoring of the needs of the community and the local area”.
According to the challenges affecting companies’ behaviors and actions towards CSR that have been reported into the initial part of the chapter, the Group mission is easily recognized as a response to one of them: the increase in the spread and relevance of traditional stakeholders involvement and the consequent need of better responding to them and balancing their different expectations.
Built on the mission statement, the Intesa Sanpaolo strategy itself is geared towards a “solid value creation for stakeholders” with whom the bank has relations. Clients, shareholders, employees, society and environment are those identifying the key areas that the Group has to work on in order to pursue a sustainable, continuous and strong growth. Accordingly, “individuals” are declared to be one of the core values of the Group.
Generally speaking about the Group’s values that make its core identity take shape, they also strongly reflect theoretical responses to the challenges that have been underlined as relevant and urgent at the beginning of the chapter.
Energy and environmental crises push the Group to indicate as core value the “responsibility in the use of resources” by promoting a behavior based on the best use of them and the avoidance of waste, giving priority to choices that are – of course – sustainable as well.
Market shock and financial downturn affect the entire Group strategy concerning decisions and activities, which can lead to a sustainable growth by constantly and carefully monitoring risks. This is to have a sound capital base and liquidity. At the same time, values like “integrity” and “equality” are underlined as fundamental in order to responsibly compete in such a more and more complex scenario.
The focus on innovation as driver to overcome rapid changing in products and services is given a response through the declared value of “excellence” and “respect for specific qualities”. The
Group declares they aim at setting themselves the goal of continuous improvement, anticipating challenges, and cultivating creativity for innovation.
Eventually, due to the development of information and communication technology which is steadily increasing the exposure of companies and institutions to community and public opinion, the Group is striving to base its work on transparency of actions, advertising and contracts in order to allow its stakeholders to make independent and informed decisions.
Based on a strong and clear mission and on precise and exhaustive shared values, the strategy for CSR comes out easily and spontaneously.
As it can be clearly seen, the Group has always included in its regular operations and strategies references to the concepts of sustainability and responsibility.
Since a leading banking group can have and does have a significant impact on the society and environment in which it operates, Intesa Sanpaolo declares to be able to combine economic and financial goal of reaching the desired level of profit with the ethical purpose of creating value for all the stakeholders involved into the Group’s activities.
In particular, Intesa Sanpaolo “confirms the importance of Corporate Social Responsibility
as an integral part of its strategy and, believing that socially and environmentally correct choices are also winning economic choices, deems it is possible to create long-term value only if the company is run along three concrete lines – economic and financial, social and environmental – and if the company’s operations are supported by transparent corporate governance”.
Therefore, as part of the Group’s strategy, CSR is intended to make the bank achieve growth objectives, by following some interconnected strategic choices which represent the basis of CSR concrete implementation. These choices have been linked as strategic responses to the changes and challenges mentioned in the first paragraph; the “Scheme 2” describes the representation of the link. Scheme 2: Intesa Sanpaolo CSR strategy: link between strategic choices and current
challenges C S R S T A T E G Y 1) Preserving the environment, fighting
against climate change, reducing impacts, improving energy efficiency
2) Driving credit operations on the basis of environmental criteria
ENVIRONMENTAL AND ENERGY CRISES
ECONOMIC AND FINANCIAL CRISIS
3) Supporting businesses and using social and environmental sustainability criteria
PRESSURE ON INNOVATION 4) Making products and services more accessible
5) Offering green products and services 6) Supporting investments in innovation
7) Innovating the system of relationships with stakeholders (i.e. means of communications)
DEVELOPMENT OF INFORMATION AND COMMUNICATION TECHNOLOGY
Before going into the practical and empirical CSR implementation within the Group’s activities, it is necessary to figure out how and by whom CSR strategies and actions are run.
In general, Intesa Sanpaolo’s aim is to make sustainability topics more and more related to the regular and core corporate activities. Therefore, the goals concerning those activities will be better achieved through: employees and people development, the increase in products and services quality as response to changing customer’s needs, the social and the economic value creation both for the bank as institution and the community, and environmental-friendly management and culture. In particular, the Group carefully monitors its relations with stakeholders and the efficiency of corporate organizational processes in order to guarantee a continuous practical application of the standards declared into the Ethical Code.
Moreover, in order to verify the correct implementation of CSR actions taken by the Group – which are going to be described later in the paragraph – Intesa Sanpaolo choses to make the best use of specialized consultancy services aiming to develop a shared activities-monitoring system by applying methodologies and standards internationally recognized by Institute of Social and Ethical Accountability and Vigeo.
These checking and monitoring tools – which have been concretely part of the management activities since 2010 – offer to the Group’s board and management a complete overview of the spread of interaction between CSR policies and governance decisions. The aim is to better identify areas of potential interventions and improvements.
Concerning the governance of CSR within the Group, it has been set up in a different and peculiar way if compared to the general behaviour of Italian companies towards CSR management14. A dedicated unit has been created in order to give CSR its own visibility and strong voice both internally – towards employees and management – and externally – talking to a broader public including customers and community.
The unit’s tasks aim at monitoring and coordinating the various different issues regarding social responsibility and sustainability, as can be seen form the “Scheme 3” hereinafter.
Under the name of “Corporate Social Responsibility Unit”, it reports directly to the Managing Director and Chief Executive Officer. It is completely separated and independent from Communication and Marketing Departments. It gives evidence that CSR is not meant to be a communication tool or a way of strengthening the brand perception among clients but a real and concrete strategy to be implemented.
Moreover, within each department and subsidiary in Italy and abroad, a CSR representative has the task of sharing and spreading new topics, supporting new projects and specific initiatives and taking part in Reports set up.
Scheme 3: Group’s Corporate Social Responsibility Unit
14 See in the previous paragraph the results from the research carried out by Altis and Isvi on CSR managers in Italy in 2006.
8) Interpreting the need of the territory and meeting local expectations
9) Supporting investments in infrastructures, third sector and community heritage
10) Promoting the development of people and the quality of life internally and externally the company
PRESSURE FROM STAKEHOLDERS
Basically, on one hand CSR Unit is engaged in all of the activities that have been identified as three dimensions of CSR in the “Scheme 1” of the first paragraph: accountability, corporate philanthropy, ethics and sustainability.
On the other hand, it is necessary to underline the fact that some activities – mainly concerning the area of philanthropy – belongs to individuals within the Group and most of all to the Managing Director and CEO.
Whilst some CSR tools – for instance those connected to the accountability dimension – are now greatly required in order to be well perceived from the market and they are seen as almost compulsory; some other tools that are going to be described are strictly dependent on an individual vision and will towards particular concerns and issues.
Corporate philanthropy and ethical and sustainable products and services development constitute clear examples.
Given these premises, the further step is to analyze how CSR is put in practice by grouping together all of the instruments and activities the Group makes use of and pursues.
In order to have a clearer picture of them, the scheme on CSR dimensions and activities described in paragraph 1 of the present chapter will be used as guideline and will be completed referring to Intesa Sanpaolo Group, as the “Scheme 4” below shows.
Managing Director and CEO CSR Unit
Business Units Head Office Departments
Supporting top management in defining strategies and policies which can be integrated to sustainability and CSR Helping in maintaining long-term relations with
stakeholders
Providing staff training and courses for social and environmental responsibility topics
The Unit’s tasks impact on the entire
organizational structure
Supporting the Bank’s communication concerning social and environmental topics
Defining guidelines and policies on environmental and energy which all the Departments should align with Setting up and maintaining the Environmental and Energy
Quality Management System
Scheme 4: Intesa Sanpaolo Group’s CSR Dimensions and Activities
Dimensions Accountability Corporate
Philanthropy Ethics and Sustainability
Activities - Code of Ethics
- Social Report
- Norms and Standards implementation: o UNI EN ISO 9001 o ISO/IEC 27001 o ISEA AA1000 o PattiChiari o UNI EN ISO 14001 o UNI CEI EN 16001 - Adherence to International Standards: o GRI: Global Reporting Initiative o UN Global Compact o UNEP o Equator Principles o Carbon Disclosure Project - Cash Donations - Sponsorships - Partnerships - Investments in specific projects: Project Malawi, CARISBO’S - Development and implementation of ethical financial
products and services o Ethical Funds o Microcredit o Business
Gemma Insurance
- Policies and Rules:
o Project financing within the Equator
Principles o Rules for the
Environmental and Energy policy o Rules on the Granting on Credit in the Armament Sector - Sustainable processes: energy saving - Employees involvement in CSR tools adoption: training activities - Banca Prossima:
services and products addressed to Third Sector
Source: Personal Processing
Each CSR dimension will be further analyzed by describing the activities carried out one by one. They will prove the concrete Group’s commitment and involvement to the topics of sustainability and ethics, community and communication of the actions.
Accountability:
Code of Ethics: the main purposes for a company which decides to adopt a Code of Ethics are to define accepted and acceptable behaviors, to promote high standards of practice, to
provide a benchmark for members to use for self-evaluation and to establish a framework for professional behavior and responsibilities15.
According to these objectives, the Group’s Code of Ethics is focused on three main areas: values, principles of conducting stakeholder relations, implementation and control. The first area groups together all the values and principles the Group declares to adhere, including the mission statement. Intesa Sanpaolo social and environmental responsibility guides the content of the entire Code, since it represents the basis of a constructive dialogue with stakeholders according to their concerns.
The second pillar of the Code is represented by those principles they are used to adopting in conducting stakeholder relations; in particular the Code considers those with customers, shareholders, employees, suppliers, environment and community. A different section is dedicated to each stakeholder.
In defining the system of relations and the way of managing them, the Group states to follow some different international principles, such as the Global Compact promoted by the United Nations, the Human Right Principles listed in the Universal Declaration of 1948, the ILO (International Labour Organization) fundamental conventions on rights at work, the guidelines of the OECD (Organization for Economic Co-operation and Development) and the principles of United Nation against corruption.
Eventually, the last section of the Code is entirely dedicated to the mechanisms for implementing the principles, governance system and internal auditing.
In order to give more transparency and accessibility to the information contained in the Code, it is published on the Group’s website where it can be accessed by customers and interested parties. Moreover, it is also available on the company’s intranet and a hardcopy of the Code is delivered to each Director, employee or external collaborator and at any start of a job relationship.
The Corporate Social Responsibility Unit plays a central role in Code of Ethics publication, in supporting and advising departments within the company and in monitoring procedures to ensure that policies and activities comply with the Code itself.
Social Report: the Group’s Social Report is set up according to three main guidelines or principles:
- the guidelines for the preparation of Social Reports for the banking sector “The Report to Stakeholders. A Guide for Banks” published by ABI (Associazione Bancaria Italiana [Italian Banking Association]) in collaboration with Econometica (the Multi University Centre for Economic Ethics and Corporate Social Responsibility)16;
- the Global Reporting Initiative (GRI 3rd edition) Sustainability Reporting guidelines, the most recent GRI “Financial Services Sector Supplement” which meets the requirement of the A+ application level;
15 For more information on Codes of Ethics and its concrete implementation, see the website www.calsca.com, Life Skill Coaches Association of British Columbia.
16 The Report contains the guidelines and the principles for integrating social and environmental commitments into a company’s overall strategic scenario. In particular, it underlines the importance of a mode of “self-responsibilisation” for Bank departments involved in guaranteeing the application of social responsibility actions as part of their normal business. This is the reason why tasks of the CSR Unit are defined as well as “CSR Delegates” who has to be appointed in each department to be responsible for specific activities within the CSR Unit. Starting from the management model, the Report includes the step for a bank to follow in order to activate a concrete management process in the field of CSR: context analysis, stakeholder map and listening to their issues, CSR strategy definition, submission to the Top Management and objective definition, definition of projects and related indicators, information flows and monitoring, concluding with the preparation and publication of the Social Report.
- the Ten principles of the Global Compact17 promoted by United Nations. These principles are given concrete responses by the Group activities in accountability, ethics and sustainability and philanthropy.
The Group’s Social Report is divided into 5 main sections:
1- Identity and Governance contains general information about the Group’s profile, its governance mechanisms, its CSR structure and management, the explanation of the mission statement, its values, principles and strategies.
2- Economic Report is focused on the distribution of the economic value that the Group reached in the last year.
3- Social Report takes into account all the initiatives carried out to meet the needs of customers, employees, shareholders, suppliers, environment and community.
4- Improving Objectives is the section dedicated to set up new goals for the years to come in relation to all the stakeholders and the Group’s products and services.
5- Indicators: other than economic key indicators, the value added is here calculated and its distribution among the stakeholders is described.
Certifications and International Standards:
- UNI EN ISO 9001: the Standard has been implemented for the years 1999, 2006 and 2010 including certifications for the design, implementation and provision of international and Single Euro Payments Area (SEPA) payment services and related customer assistance to the commercial network, Certification for the Quality Management System adopted by Intesa's Prevention and Protection Service and the design and provision of services for the management of information security in the Intesa Sanpaolo Group;
- ISO/IEC 27001: for the years 2005 and 2010 the Standards testifies the Group’s capacity of analyzing, planning, developing, maintaining and providing services for Internet Banking Retail, Phone Banking and Bankidentity, and internal departmental Facility Management services for open systems (Mediofactoring SpA);
- ISEA AA1000: as reported by the website Mallenbaker, the standard AA1000 by Institute for Social and Ethical Accountability is promoted as a mean for measuring and reporting of ethical behavior in business. The Group follows its principles as for the preparation of its Social Report;
- PattiChiari: the initiative aims at helping clients chose the most suitable financial product that meets their needs by adopting simple and reliable tools that can make it easier to understand banking offers and to compare them to competitors. In this way clients – who become more conscious - can play an active part in the relation with the bank;
- eventually, the successful environmental policy implemented by Intesa Sanpaolo Group consists of the adoption of the Environmental Management System (in accordance with UNI EN ISO 14001) together with the integration of the Energy Management System (UNI CEI EN 16001) applied to 180 Group’s sites. In June 2010 Intesa Sanpaolo was the first Italian bank integrating this kind of system with the UNI EN ISO one.
17 The ten principles consist of general behaviors for businesses to adopt in the field of Human Rights, Labour, Environment and Corruption, in particular they should: support and respect the protection of internationally proclaimed human rights, make sure they are not complicit in human rights abuses, uphold the freedom of association and the effective recognition of the right to collective bargaining, uphold the elimination of all forms of forced and compulsory labour, uphold the effective abolition of child labour, uphold the elimination of discrimination in respect of employment and occupation, support a precautionary approach to environmental challenges, undertake initiatives to promote greater environmental responsibility, encourage the development and diffusion of environmentally friendly technologies and work against corruption in all its forms, including extortion and bribery. For further information see the website www.unglobalcompact.org
Moreover, great attention is paid to the use of renewable sources (such as the use of hydroelectric power) and to the identification and promotion of initiatives to rationalize resources and reduce pollutant emissions (under the name of Energy Management). Adherence to International Standards: since accountability requires communicating to give
evidence of a responsible and sustainable way of operating within the market, the Group reports on its website all the International Standards they have adhered to for specific projects or they have adopted for carrying out social and environmental-oriented activities. As mentioned before, from 2010 Intesa Sanpaolo is accredited as an organizational stakeholder and supports the GRI mission. The Group gives its adherence to the Ten Principles of UN Global Compact, which aims at promoting CSR within business operations. Moreover, since 2007 they have taken part to the initiative concerning environment in financial sector (UNEP FI) pursued by United Nation programme, which aims at fostering the commitment to environmental issues linked to economic and sustainable development. In the same year, the Group adopted the Equator set of principles, which are supposed to work as guidelines for project financing on the basis of the International Finance Corporation (World Bank’s subsidiary) safeguard policies. Eventually, through the partnership with Carbon Disclosure Project whose task is to monitor information on climate change in the world, the Group aims at keeping the level of its emission lower and lower and at fostering its strategy for climate change.
Ethics and sustainability:
Development and implementation of ethical financial products and services: according to the Social Report section dedicated to set up new goals for Intesa Sanpaolo in the years to come, the Group aims to develop a range of innovative products and services in order to promote financial inclusion for particular categories of individuals and meet different customers’ specific needs. In particular, three activities are carrying out on this topic: investments in ethical funds, microcredit and Business Gemma insurance policy.
- Ethical funds: as the Group declares in the Code of Ethics at the section “Principles of conducting Stakeholder relations” “investments must always give more weight to social and environmental criteria and the good governance of companies in order to promote balanced and sustainable development” (Intesa Sanpaolo Code of Ethics, 2009). Accordingly, the Company offers to their customers a range of different choices in ethical, social and environmental forms of investments. In particular, the ethical fund system the bank has implemented allows customers to choose among an of shares and securities funds managed by Eurizon Capital, such as Eurizon Ethical International Equity, Eurizon Ethical Diversified and Eurizon Ethical Bond. On one hand, the portfolio avoids all the companies and areas of activity, which are considered in contrast to the ethical principles declared by the funds (i.e. arms sector, antitrust violation, accounting frauds, discrimination in granting loans). On the other hand it includes all those working towards reduction of greenhouse gas, the safeguarding of biodiversity, the use of clean technology, the involvement of suppliers and the protection of minorities in the workforce;
- Microcredit activity is pursued by the Group with a total value of 1,815 euro in 2010 on a total amount of 3,138,197 euro spent on the initiatives that highly impact on society wellbeing, including: anti-usury loans, public administration for socially useful projects, loans guaranteed by Confidi, loans to the Third Sector and products for sensitive social classes.
- Business Gemma: in December 2011 Intesa Sanpaolo launched Business Gemma, an insurance policy which offers a wide range of assistance and support to
self-employed women both in the everyday activities and when serious events occur. The aim of the project is to have a significant positive impact on family wellbeing and sustainability of their business.
Policies and Rules: policies that the Group have issued in the field of CSR can be considered part of its ethical and sustainable products/services package aiming to “sell” and promote ideas and standards to certain types of stakeholders who have interests in certain linked bank’s activities. Policies can be mainly considered as internal CSR tools, with the aim of involving employees as direct clients and making them aware of the bank’s behavior towards different kind of issues and topics. The final aim is then to make the whole organizational structure homogeneous within the stated principles. The most significant policies and rules issued in the field of responsible business attitude are reported below.
- Within the Equator Principles to which the Bank adheres in the field of project financing, in July 2010 the Group issued a policy through which these World Bank’s principles – concerning the social and environmental risks of credit decision – have become necessary and almost compulsory for projects evaluation. Accordingly, in 2011 three guidelines belonging to the general Environmental and Energy Policy have been issued: the first concerns the sustainable planning of commercial and training events and the other two are related to responsible purchases and use of paper and derivatives material.
- Rules for the Environmental and Energy Policy: in July 2011 the Group issued this rule in order to outline its approach in preventing, managing and reducing the environmental impacts. The policy clearly describes areas of intervention, which cause both direct and indirect impacts on the environment. It is addressed to all the stakeholders and in particular to whom represents the “voice” of the environment and energy consumption.
- Rules of the Granting on Credit in the Armament Sector: according to an ethical way of doing business one of the key issues for banking and financial sector is to be aware of sectors/activities they invest in or deal with. That is why in December 2011 a formal rule on armament sector was issued by Intesa Sanpaolo. It confirms the bank’s position entirely adhering to the principles of Italian Constitution, which rejects war as mean of solving international controversies. The response to this ethical issue has led the Group to suspend any participation in activities such as financing and executing transactions concerning the trade and production of arms and arms system, even if allowed by the law. In the rule, the bank states its will to annually report on the concrete implementation of what they declare. Moreover, each Group’s subsidiary is asked to put someone in charge of monitoring policy application and of communicating information on actions consistent with the policy every three months.
Sustainable processes: Within the rule for Environmental and Energy Policy, the Group has also launched an ambitious project looking at energy optimization for the years 2009-2012 with the aim of consistently reducing the consumption of the Parent Company and Main Network Banks.
Employees involvement in CSR tools adoption: providing that the rules issued, the reports and the CSR actions need to be shared among employees in order to strengthen their commitment towards the topics, the Group has set up a system of on-line training to keep them constantly informed about new arising issues. The first example is related to the Code of Ethics: its values and principles are conveyed through training activities aiming at achieving consensus on the contents and at providing shared tools for raising awareness and
knowledge about a broader vision on CSR that employees are asked to adopt while doing their tasks.
Concerning the environmental culture which is a fundamental part of the wider Group’s CSR strategy, in 2010 Intesa Sanpaolo launched the project “Ambientiamo”, a set of training sessions delivered to all employees through different means such as video, e-learning, web, TV, radio, company magazine and mail. The project seeks to achieve four main key goals: increasing the awareness on the environmental culture, making employees aware of their everyday activities effects on the environment and energy emission, supporting activities of the Environmental Sustainability Policy, and sharing ideas on potential new projects implementation.
Banca Prossima: as part of Intesa Sanpaolo Group, Banca Prossima was founded to be entirely addressed to the nonprofit realities, with the aim of representing the best response to their needs and improving the banking services quality in order to contribute to the ethical and economic development. Strongly based on sustainable and ethical values, the bank’s primary goal is to create social (ethical) value by supporting – through credit – the best nonprofits’ initiatives towards human wellbeing, culture and education, environment protection and development, arts, access to credit and to labor market (Banca Prossima Articles of Association, article 4).
Because of its nature, Banca Prossima is considered a route through which Intesa Sanpaolo Group can sell to a certain market (nonprofit) certain types of ethical and sustainable financial products and services. The bank can be considered itself a sustainable service for meeting nonprofits’ demand. It is not a philanthropic initiative, since “the Bank excludes from its activities and objects the merely free grant donations” (Banca Prossima Articles of Association, article 6). On the other hand, its policy includes efforts to strengthen and guarantee access to credit to disadvantaged people or people in particular conditions (i.e. running their first business, health and illnesses, educational problems, first housing purchase).
To achieve its mission the Bank uses its own resources for participating to private or public programmes, which aim at supporting good causes and cooperation and development activities. Microfinance and microcredit initiatives have been set up through programmes of technical assistance.
The main Bank’s goal of giving nonprofits projects a chance to be put in practice is pursued through an innovative rating system for evaluating the projects by taking into account the nonprofits’ peculiarities. Concerning these projects, the Bank has also created a “Fund for the development of Social Enterprises” which allows some more difficult projects to be considered more feasible. Every year the Bank contributes to increase the Fund by putting half of its annual profit in.
Philanthropy:
Cash Donations: according to the Code of Ethics, the Bank declares to support nonprofit and socially involved companies with the aim to benefit the community both locally (by supporting Third sector and favoring supplementary welfare programmes) and globally (by supporting initiatives of solidarity). Intesa Sanpaolo provides donations both at a central level (through the Fund for charitable, social and cultural contribution) and through direct intervention by Group’s Banks. On a total amount of 15,283 euro spent in 2010, most of the cash donations both locally and abroad have been addressed to cultural heritage, national and international initiatives of solidarity, health support and research, training, university research and study grants, support for families and local initiatives. The most significant initiatives supported by the Group are taking place in developing countries such as the
