The Scandinavian Cooperative Advantage

Today we have another of our guest bloggers taking a turn on the Crane and Matten blog. Robert Strand from  Copenhagen Business School sets out why he thinks there's a distinctly Scandinavian approach to corporate social responsibility (CSR).

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I had the pleasure of spending time with Andy Crane during his recent visits to the Copenhagen Business School Centre for CSR, where I am pursing my Ph.D.  Andy asked if I would share a few words about the Scandinavian approach to CSR- a topic I find so interesting that I was compelled to leave my cushy corporate job in the US to move to the heart of Scandinavia and return to the days of being a poor student.


First off, why study CSR in Scandinavia?  Well, for one, by pretty much any measure Scandinavia leads the world in strong CSR performances.  Gather up a suite of your favorite CSR indices and you are sure to find a disproportionate amount of Scandinavian companies at the top.  And given that humility is highly valued here, this is not likely the result of crafty Scandinavian spin-doctors.


So why does Scandinavia lead in CSR?  Stereotypes are a real time-saver, so allow me to indulge in a few.  It seems to be part of the Scandinavian cultural DNA for business leaders to encourage the “feminine” activities of collaboration, participation, and demonstrate far more humility than what I was accustomed to in US industry where the masculine John Wayne type was more likely to be hero-worshipped.  Here in Scandinavia, conflict is considered best solved through negotiation and compromise and as a result Scandinavian companies have built trusting partnerships with NGO’s, government agencies, and even competitors to address common social and environmental challenges.  This has led to a “Scandinavian Cooperative Advantage” (Strand 2009) that I believe will prove to be a long-term competitive advantage for the region in the face of increasingly complex social and environmental challenges that companies cannot solve alone.

IKEA offers a good example of the Scandinavian Cooperative Advantage in practice.  At a going rate of about $10 for a pint of beer, Scandinavia is not exactly a prime place to manufacture low-priced furniture.  So IKEA sources from low cost regions, which exposes them to a host of social and environmental challenges not typically known within the friendly confines of Scandinavia.  Child labor poses a particularly complex challenge, and IKEA recognized that it did not possess the competencies to deal with this alone (which took a bit of humility, don’t you think?).  Therefore IKEA formed partnerships with UNICEF and Save the Children where in collaboration with these NGO’s, the suppliers, and local communities it was determined that in most cases the children’s best interest would be served if they could continue to work for IKEA’s suppliers, however at reduced hours and with access to schools that they previously did not have. A hasty pullout by IKEA in the face of consumer boycott threats could make the situation worse for the children who may be forced into alternative forms of generating money, including prostitution.Thus as a result of IKEA’s willingness to collaborate, these children are better off and IKEA enjoys a more stable supply chain and has credible partners in UNICEF and Save the Children to vouch on its behalf in the face of consumer boycott threats.

What’s that? Oh, you noticed that I repeatedly plugged my own expression “Scandinavian Cooperative Advantage” in a shameless act of self-promotion. Keep in mind - I’m an American, not a humble Scandinavian.

You can contact Robert at rs.ikl@cbs.dk. Check out his article in the Journal of Business Ethics: Strand, R. 2009. Corporate Responsibility in Scandinavian Supply Chains.  Journal of Business Ethics.  Volume 85, Supplement 1, pp. 179-185.

Good news from China

We have been talking about China quite a bit recently. Not only on this blog, but also in numerous discussions and emails with our current and former students, various issues around the Olympics have come up. One of the sentiments voiced particularly by our Chinese readers was that it is quite hard to be Chinese these days. With all these critical questions asked about the politics of the country the debate can all too easily sound as if it is about bringing an entire country and its people wholesale into discredit.

Believe us, with one of the authors of this blog coming from a country with quite a notorious legacy in the 20th century, we can empathize with that feeling. Therefore, the more we are happy to report some interesting news on China and business ethics this week.

On Thursday, it was front page news in the New York Times that Chinese authorities successfully broke up a child labor ring in southern China’s Guangdong Province. More than 100 children between 13 and 15, often kidnapped from other parts of the country, were liberated from ‘captive, almost slavelike conditions and minimal pay’.

The article demonstrates a growing concern for human rights among Chinese authorities. It also provides an interesting perspective on the ethical issues involved. One factor is the sheer size of the country, which makes it tricky to enforce even the best intentions of the central government. Furthermore, it highlights that despite China’s economic boom, considerable parts of the population are still living in relative poverty and that cheap labour from rural China is in much demand from coastal regions feeling the pinch of rising costs.

These things take time, as we in the west should know all too well. In our business ethics book (p.298) we discuss Tom Donaldson’s argument that in applying human rights to a situation, the general context of economic development has to be taken into account. One or two centuries ago, European or North American children indeed played a key role in contributing to the family income, just think of Charles Dickens’ novel ‘Oliver Twist’.

The article also puts this governmental crack down in the context of the Olympics. As unpleasant as all this international criticism might be – it obviously has an effect. And as predicted earlier in our blog, businesses are in the front line if it comes to the locus of change. Perhaps most heartening of all though is that details of the child labour ring were uncovered by the Chinese media, not the usual suspects from overseas.

During the cold war, progressive political leaders such as the famous Willy Brandt were vilified for their ‘change through rapprochement’ politics between West and East. Arguably, by hindsight this was a key element in bringing down the Iron Curtain. It seems that with China, the same strategy might work. That’s why hosting the Olympics, maintaing close economic ties, and encouraging media freedoms, could be key for the journey ahead.

On a more personal note, Crane and Matten had other good news from China this week. Brokered by one of our students, a leading Chinese University Press has taken up discussions with our publisher to prepare a Chinese translation of ‘Business Ethics’! We keep you posted on these developments. But no promise yet that we will ever master a Chinese blog for that one…