International Journal of Engineering and Advanced Technology (IJEAT)
ISSN: 2249 – 8958, Volume-8 Issue-3, February 2019
655
Published By:
Blue Eyes Intelligence Engineering
& Sciences Publication
Retrieval Number: C571702831919©BEIESP
Measuring the overall and integrated performance
of socially responsible companies: the case of fair
trade
Samira MILI, Carlos FERRO SOTO, Abdelghani BOUAYAD
Abstract: According to the Brundtland Report, the world is
conceived as a global system whose parts are interdependent,
considering the concept of sustainable development as a
multidimensional process affecting the economic, ecological and
social system, it has become a variable to be taken into account in
decisions of economic policy. This integration is reflected in the
concept of corporate social responsibility CSR. The main purpose
of this research paper is applicate this issue by calling for fair
trade as a CSR tool which is mainly based on practices of
sustainable development. This qualitative case study research
reviews the measurement of the overall performance of two fair
trade coffee cooperatives in Mexico FIECH and UCIRI, applying
the RScat model of the social responsibility of small and medium-
sized enterprises.The main conclusions reflect that fair trade
firms give equal importance to economic, social, and
environmental responsibilities. Further, this study identifies the
important factors included in each level of corporate social
responsibility. Findings also reveal that this model can measure
the overall performance of the company regardless of its size.
This research highlights how a small company can integrate,
manage, measure and control its social responsibility policy.
Keywords: Corporate Social Responsibility, Fair trade,
Management, Performance Development, Sustainability.
I. INTRODUCTION
The performance was initially understood from a strictly
financial point of view, this concept has been broadened to
take into account the social responsibility of the company.
However, first and foremost the company seeks to assume
stability through the achievement of economic profitability.
Once this is assured, certain actions going beyond its legal
and economic obligations. Several authors have defended
the thesis according to which, the company will have to
realize economic gains, since it is its principal mission. In
particular, we quote Friedman [1] who follows the classic
trend claiming the company's main objective is the
maximization of its value, that is to say, the wealth of the
shareholders. Drucker [2] and Jensen [3] follow the same
reasoning, and argue that true corporate social responsibility
is to be effective and to make a profit, however, economic
and social problems must remain the predictive realm of
State. Davis [4] follows a different trend from other authors
and believes that the company cannot stay away from these
issues of society, if it aims to perpetuate its legitimacy and
the power entrusted to it.
Revised Manuscript Received on 24 February 2019.
Samira MILI, Phd in department of Business Management and Marketing.
University of Vigo. Spain
Carlos FERRO SOTO, Professor Department of Business Management
and Marketing. University of Vigo. Spain
Abdelrhani BOUAYAD, Professor of Higher Education and Dean of the
Faculty of Legal, Economic and Social Sciences
It is in this logic, that the global performance appears,
taking into account some variables previously not
considered, in particular the social and environmental
aspect. According to some authors like Baret [5] and
Reynaud [6] the performance is the aggregation of the
economic, social and environmental performances, and for
others like Germain and Trébucq [7] it is formed by the
meeting of the performance financial performance, social
performance and social performance. Dohou and Berland
[8] present several tools that measure the overall
performance of the company, including the SD 21000 guide,
the ISO 26000 standard, the Global Reporting Initiative
(GRI), and the Balanced Score card (BSC). In this article we
will study another performance measurement tool adapted to
small and medium-sized enterprises, taking the example of
fair trade cooperatives.
II. LITERATURE REVIEW
The literature has often explained taking into account
several factors, the positive impact of the company's
commitment to sustainable development practices. From this
observation, environmental and social information could be
taken into account by financial analysts when developing
their diagnosis. These positive consequences concern, in
particular, the company's commitment to innovation,
because the sustainable development approach is seen as a
factor of innovation, of launching new products or services
including societal or environmental added value, which
represents a difference from its competitors (integration of
fair and organic products for example), the creation of new
market segments as responsible consumers, green or
citizens. It is also fundamental to competitiveness, Porter [9]
argues that companies should consider CSR as part of their
strategy to become more competitive. Another positive
impact is the reduction of costs, since environmental
protection research can lead to a substantial reduction in
energy costs, through energy saving, minimization of waste
and efficiency gains. From this observation, the commitment
to sustainable development is proposed as a win-win
strategy often called the Porter hypothesis, since the
reduction of pollution tends to reduce the quantities of
materials and energy used and therefore increase
productivity [10]. According to Capron [11], corporate
social responsibility is linked to an organization's
management of the social and environmental impact of its
activities on society, accompanied by a constant and
bidirectional dialogue with stakeholders.