Professional Documents
Culture Documents
New Approaches To CSR
New Approaches To CSR
New Approaches
to CSR,
Sustainability and
Accountability,
Volume I
Accounting, Finance, Sustainability,
Governance & Fraud: Theory and Application
Series Editor
Kıymet Tunca Çalıyurt, Iktisadi ve Idari Bilimler Fakultes, Trakya University
Balkan Yerleskesi, Edirne, Turkey
This series acts as a forum for book publications on current research arising from
debates about key topics that have emerged from global economic crises during the
past several years. The importance of governance and the will to deal with
corruption, fraud, and bad practice, are themes featured in volumes published in the
series. These topics are not only of concern to businesses and their investors, but
also to governments and supranational organizations, such as the United Nations
and the European Union. Accounting, Finance, Sustainability, Governance &
Fraud: Theory and Application takes on a distinctive perspective to explore crucial
issues that currently have little or no coverage. Thus the series integrates both
theoretical developments and practical experiences to feature themes that are
topical, or are deemed to become topical within a short time. The series welcomes
interdisciplinary research covering the topics of accounting, auditing, governance,
and fraud.
123
Editor
Kıymet Tunca Çalıyurt
Trakya University
Edirne, Turkey
This Springer imprint is published by the registered company Springer Nature Singapore Pte Ltd.
The registered company address is: 152 Beach Road, #21-01/04 Gateway East, Singapore 189721,
Singapore
Acknowledgements
As the founder of the International Group on Governance Fraud Ethics and CSR,
I would like to dedicate this book to the distinguished academician, 8th conference
president Prof. Nauman Farooqi, Dean of Business and Social Sciences, Mount
Allison University.
https://isletme.trakya.edu.tr/pages/2017-konferans-kitabi.
Prof. Dr. Nauman Farooqi has been attending International Conference on
Governance Fraud Ethics and CSR as keynote speaker since 2010 and also acting as
member in scientific committee.
Prof. Nauman is the most recognized academician on Hawala System in the
world. We would like to express our sincere respects and thanks to Prof. Dr. Nauman
Farooqi for his support to our conference series.
v
Contents
Part I Overview
1 Introduction: Why Do We Need to Talk About Climate Change
Risk as Accountants and Auditors Urgently? . . . . . . . . . . . . . . . . . 3
Kıymet Tunca Çalıyurt
vii
viii Contents
Index . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 265
Editor and Contributors
Prof. Dr. Kıymet Tunca Çalıyurt, CPA, CFE graduated from the Faculty of
Business Administration at Marmara University, Istanbul, Turkey. Her Masters and
Ph.D. degrees are in the Accounting and Finance Programme from the Social
Graduate School, Marmara University. She has worked as Auditor in Horwath
Auditing Company, Manager in McDonalds and finance staff in Singapore Airlines.
After vast experience in the private sector, she has started to work in academia. She is
holding CFE and CPE titles. Her research interests are in accounting, auditing, fraud,
social responsibility, corporate governance, finance and business ethics, with a special
interest in aviation management, NGOs, women rights in business. She has been as
visiting researcher in Massachusetts University Amherst Business School. She is the
founder of the International Group on Governance, Fraud, Ethics and Social
Responsibility (IGonGFE&SR) which was founded in 2009. In 2009, she also
founded the International Women and Business Group, which organizes global,
annual conferences. Kıymet has published papers, book chapters and books both
nationally and internationally on fraud, social responsibility, ethics in accounting/
finance/aviation disciplines in Springer and Routledge. She is book series editor in
Springer with the title Accounting, Finance, Sustainability, Governance & Fraud:
Theory and Application, and book series editor in Routledge with the title Women and
Sustainable Business. Some book titles: Emerging Fraud (with Sam Idowu),
Corporate Governance: An International Perspective (with Sam Idowu), Women and
Sustainability in Business: A Global Perspective, Sustainability and Management:
An International Perspective (with Ulku Yuksel), Globalization and Social
Responsibility (with David Crowther), Regulations and Applications of Ethics in
Business Practice (with Dr. Jiang Bian), Ethics and Sustainability in Accounting and
Finance, Volume I. She is acting as member in editorial board Journal of Financial
Crime, Social Responsibility Journal, International Journal on Law and
Management, Journal of Money Laundering Control. She is a regular speaker at
International Economic Crime Symposium in Jesus College, Cambridge University.
ix
x Editor and Contributors
Contributors
Başak Oktay Akın Department of Banking and Insurance, Keşan Yusuf Çapraz
School of Applied Sciences, Trakya University, Edirne, Turkey
Milen Baltov Burgas Free University, Burgas, Bulgaria
Mehjabeen Barodawala ICSSR, MLS University, Udaipur, Rajasthan, India
Simeana Beshi Faculty of Law, FAMA College, Pristina, Kosovo
Dimitar Blagoev University of National and World Economy, Sofia, Bulgaria
Kıymet Tunca Çalıyurt Business Administration Department, Trakya University,
Edirne, Turkey
Fikret Çankaya Black Sea Technical University, Trabzon, Turkey
Feyza Çağla Oran Kadir Has University, Istanbul, Turkey
Enver Erdinç Dinçsoy Department of Banking, School of Applied Sciences,
Trakya University, Edirne, Turkey
Meltem Okur Dinçsoy Department of Economics, Faculty of Economics and
Administrative Sciences, Trakya University, Edirne, Turkey
Hasan Fauzi Center for Social and Environmental Accounting Research and
Development (ICSEARD);
Faculty of Economics and Business, Sebelas Maret University, Surakarta, Indonesia
Sergio Luiz Braga França Fluminense Federal University, Rio de Janeiro, Brazil
Alberto Eduardo Besser Freitag Fluminense Federal University, Rio de Janeiro,
Brazil
Elvia Ivada Faculty of Teacher Training and Education;
Faculty of Economics and Business, Sebelas Maret University, Surakarta, Indonesia
Renu Jatana UCCMS, MLS University, Udaipur, Rajasthan, India
Diana Kopeva University of National and World Economy, Sofia, Bulgaria
Marcelo Jasmim Meiriño Fluminense Federal University, Rio de Janeiro, Brazil
Arzu Özyol Ankara University, Ankara, Turkey
Osvaldo L. G. Quelhas Fluminense Federal University, Rio de Janeiro, Brazil
Diana Sabotinova Mladenova Burgas Free University, Burgas, Bulgaria
Editor and Contributors xi
xiii
xiv List of Figures
xv
xvi List of Tables
As the International Group on Governance Fraud Ethics and CSR, we wrote this
book while we were organizing the 8th conference in Canada and 9th conference in
India. I would like to thank Prof. Nauman Farooqi, Dean of Business and Social
Sciences and Prof. Harpreet Kaur, Head of Corporate Governance Department,
National Law University for their hospitality. In this book, we have thirteen
chapters around five countries: Turkey, Bulgaria, Indonesia, Brasil, and India. Our
authors have discussed recent issues on sustainability and corporate social
responsibility in their chapters. In four chapters, we focused on women in sus-
tainability and corporate social responsibility. As an accounting professor, my plan
is to have your attention on a very urgent issue, climate change risk and its man-
agement. Why? Because our world is dying… Most of the companies don’t pay
attention to environmental problem, they don’t like to publish sustainability report,
they don’t like to get training for their staff on environmental issues, they don’t like
to measure and disclose carbon emission, etc. However, all of us know that irre-
sponsible companies make environmental issues worse everyday therefore
accountant and finance staff in companies have responsibilities to push managerial
board and shareholders to include sufficient expenses about environmental issues in
the budget continuously.
Climate change is a change in the pattern of weather, and related changes in
oceans, land surfaces, and ice sheets, occurring over time scales of decades or
longer. (Australian Academy of Science 2019) Latest reports issued by the
Intergovernmental Panel on Climate Change (IPCC) provide multiple lines of
evidence that the global climate is changing as a consequence of the rapidly
increasing atmospheric concentrations of greenhouse gases (IPCC 2013). The rate
of greenhouse gases in the atmosphere started to increase after the industrial rev-
olution that started in the 1750s, and the carbon dioxide rate increased by 40% to
280–394 ppm. According to the Intergovernmental Panel on Climate Change
(IPCC), the increase in carbon dioxide is primarily due to the use of fossil fuels. An
K. T. Çalıyurt (&)
Business Administration Department, Trakya University, Edirne, Turkey
e-mail: [email protected]
that 381 companies among them primarily focused on Caring for Climate, 96
companies are Carbon Pricing Champions, 84 companies are in Responsible
Climate Policy Engagement, but only one company is in Pathways to
Low-Carbon and Resilient Development.
• G20’s Financial Stability Board’s (FSB) has announced “Task Force on
Climate-Related Financial Disclosures (TCFD)” which develops voluntary,
consistent climate-related financial risk disclosures for use by companies in
providing information to investors, lenders, insurers, and other stakeholders
(FSB 2018). The TCFD has received significant support from leading compa-
nies and organizations around the world since its voluntary recommendations
were released in June 2017. The TCFD’s Final Report recommends to com-
panies specific disclosures in four areas:
a. Governance—an organization’s governance around climate-related risks and
opportunities;
b. Strategy—the actual and potential impacts of climate-related risks and oppor-
tunities on an organization’s businesses, strategy, and financial planning;
c. Risk Management—how an organization identifies, assesses, and manages
climate-related risks;
d. Metrics and targets used to assess and manage relevant climate-related risks and
opportunities. (TCFD 2018)
• Another critical issue for the companies is carbon trade, pricing, and reporting
that also carbon pricing is moving up the agenda for investors as a material risk
that companies must consider in their decision-making which is mandated by
the Financial Stability Board’s Task Force on Climate-Related Financial
Disclosures (TCFD).
• Recent global advances such as the 2015 United Nations Climate Change
Conference (COP21) in Paris, the Kigali Amendment to the Montreal
Protocol, and a pact to limit airline emissions under the International Civil
Aviation Organization (ICAO) signal growing momentum toward a
low-carbon transition. Platforms such as the U.N. Global Compact Business
Leadership Criteria on Carbon Pricing, the World Bank’s Carbon Pricing
Leadership Coalition, and business statements in support of the Paris
Agreement illustrate that companies are preparing for this low-carbon future.
• International Federation of Accountants (IFAC)’s subcommittee IAASB
asks auditors to pay attention to environmental issues. According to IAPS 1010,
“The Consideration of Environmental Matters in the Audit of Financial
Statements,” the auditor needs to consider environmental matters in the audit of
the financial statements.
• International Financial Reporting Standards Foundation (IFRS) announces
standards for accounting, however, as mentioned in Jagd’ s study (2017), the
classic logic and virtues of the financial statement, according to the International
Financial Reporting Standards (IFRS), can actually be reused and/or extended at
least the following connotations to existing IFRS rules, for which the inner logic
can be reused/extended through relatively simple means, thus obtaining quite
6 K. T. Çalıyurt
(Busch and Shrivastava 2011). The international climate change regime started very
constructively, although there has been progressing over the last 25 years, this
progress falls short of what is needed to address the climate change problem. (Gupta
2016) The most important problem about “climate change management risk” in
business is the estimate of time, place, amount, style of climate damage to the
companies and its properties. Proactive methods are recommended to corporate
boards and management, and also they need to redesign management system by
“wearing eyeglass with climate perspective.”
Recent developments, problems on CCR in corporate governance, accounting,
finance, and auditing are listed in following but of course issues are not limited. It is
easy to see that “climate change risk and its management” is an emerging issue in
accounting that professionals need to spend time and money.
• Determining and addressing physical risks, regulatory risks, market risks on
CCR by publicly held companies,
• Rewriting corporate strategies against CCR,
• Developing a budget, plan, and program against CCR,
• Training accounting, finance, and auditing staff on environmental issues, sus-
tainability and CCR,
• Sustainability reporting for CCR,
• Valuating CCR,
• Budgeting precautions against CCR,
• Estimating the cost of CCR
• External Auditor planning, auditing, documenting on CCR,
• Governing, measuring, reporting on corporate energy efficiency and corporate
carbon footprint,
• Investment decision against CCR,
• Application of IFRS 7: Financial Instruments: Information, IFRS 9: Financial
Instruments,
• IAS 37: Provisions, Contingent Liabilities, and Contingent Assets and IAS 36
Impairment of Assets for CCR,
• What is the role of the external auditor and auditing committee against CCR?
• How does external auditor will audit CCR, sustainability reporting?
• What is the role of the International Financial Reporting Standards (IFRS)?
• Difficulties in understanding and interpreting the Task Force on Climate-Related
Financial Disclosures (TCFD), IAS 6, IAS 7, IAS 37, IAS 36?
• Information system for CCR
• The differences in approaching environmental and climate change managerial
issues between developed, developing under developed countries,
• Classifying, valuating, booking, reporting stranded assets,
• Evaluating, classifying, addressing CCR in integrated reporting (IR) and role of
accountant, auditor in preparing IR.
• Fraud examination on CRR valuating, planning, budgeting, costing, reporting,
auditing.
8 K. T. Çalıyurt
The Synthesis Report confirms 95% certain that humans are the main cause of
the current global warming. (IPCC 2014) If the company management doesn’t want
to damage the nature, they have to pay attention to environmental issues. Top
executives and employees of the company should follow the latest regulations
regarding climate change even if it has not been announced as company policy.
I would like to finalize my chapter with an example from the construction sector.
In one of our book published in book series, Prof. Vassigh recommends that
building design, development, and construction are an interdisciplinary endeavor
and effective collaboration among various domain experts is critical to the sus-
tainability and resiliency of the environment.
Recent scientific research has established that climate change is primarily due to human
activities that produce heat-trapping gas emissions. These emissions are mostly a result of
burning fossil fuels, changing land use, deforestation, and other activities. Research also
shows that among all human activities contributing to climate change, the construction and
operation of buildings are among the most energy, pollution, and resource intensive. In the
USA alone, buildings and their operations consume three billion tons of raw materials, 40%
of the nation’s total energy, and 77% of its electricity use each year. Materials utilized in
constructing buildings have high embodied energy, high carbon emissions, and high levels
of toxins and pollutants in their production cycle (UNEP 2007). It is estimated that
buildings contribute as much as one-third of total global greenhouse gas (GHG) emissions
primarily through the use of fossil fuels during their operational phase (UNEP 2009).
Vassigh (2018, 88)
References
Intergovernmental Panel on Climate Change (IPCC). (2013). Climate change 2013: The physical
science basis. Cambridge: Cambridge University Press.
International Auditing and Assurance Standards Board (IAASB). (2019). Auditing standard which
is mandatory for independent auditors Practice statement 1010 the consideration of
environmental matters the audit of financial statements. http://www.ifac.org/system/files/
downloads/b007-2010-iaasb-handbook-iaps-1010.pdf. Accessed on January 14, 2019.
International Federation of Accountants (IFAC). (2015). IFAC and climate action: Letter of
support to the UN framework convention on climate change. https://www.ifac.org/
publications-resources/ifac-and-climate-action-letter-support-un-framework-convention-
climate-change. Accessed on January 12, 2019.
International Financial Reporting Standards Foundation. (2017, November). Wider corporate
reporting, Staff Paper, IASB Agenda ref 28B. https://www.ifrs.org/-/media/feature/meetings/
2017/november/iasb/wider-corporate-reporting/ap28b-update.pdf. Accessed on January 15,
2019.
IPCC. (2014). Climate change 2014: Synthesis report. Contribution of working groups I, II and III
to the fifth assessment report of the intergovernmental panel on climate change. In R.
K. Pachauri, & L. A. Meyer (Eds.), (p. 151). Geneva, Switzerland: IPCC. Retrieved September
5, 2017 from http://www.ipcc.ch/pdf/assessment-report/ar5/syr/SYR_AR5_FINAL_full_
wcover.pdf. Accessed on March 5 2019.
Jagd, J. T. (2017). TCFD = IFRS + Climate risks, revision and Regnskabsvæsen (Vol. 9). Karnov
Group.
Nikolaou, I., Evangelinos, K., & Leal Filho, W. (2015). A system dynamic approach for exploring
the effects of climate change risks on firms’ economic performance. Journal of cleaner
production, 103, 499–506.
Pickering, J., Jotzo, F., & Wood, P. J. (2015). Sharing the global climate finance effort fairly with
limited coordination. Global Environmental Politics, 15(4), 39–62.
Sakhel, A. (2017). Corporate climate risk management: Are European companies prepared.
Journal of Cleaner Production, 165(1), 103–118.
Sustainability Accounting Standards Board (SASB). (2017). Converging on climate risk: CDSB,
the SASB, and the TCFD the emerging alignment of market-based approaches to
climate-related financial disclosure September 2017. https://www.cdsb.net/sites/default/files/
sasb_cdsb-tcfd-convergingonclimaterisk-091317-web.pdf. Accessed on January 20, 2019.
TCFD. (2018). Core elements of recommended climate-related financial disclosures. https://www.
tcfdhub.org/home/recommendations. Accessed on January 10, 2019.
The International Integrated Reporting Council. (2017). IIRC responds to FSB task force on
climate-related financial disclosures. http://integratedreporting.org/news/iirc-responds-to-fsb-
task-force-on-climate-related-financial-disclosures/. Accessed on January 7, 2019.
UNEP PH. (2007). Building and climate change. Status Challenges And Opportunities. United
Nations, Environment Program, Sustainable Consumption and reduction Branch, illustrated
edition.
UNEP DTIE Sustainable Consumption & Production Branch. (2009). Buildings and climate
change: A summary for decision-makers. Paris, France: UNEP. Retrieved by CAKE http://
www.cakex.org/virtual-library/885.
Vassigh, S. (2018). Complexity of sustainable and resilient building design and urban
development. Sustainability and social responsibility of accountability reporting systems. A
Global Approach, Book Series: Accounting, Finance, Sustainability, Governance & Fraud:
Theory and Application, Springer Nature Singapore Pte Ltd.
10 K. T. Çalıyurt
Recommended Readings
Filling the information black hole: How are fossil fuel companies reporting on the stranded asset
risk? https://www.accaglobal.com/content/dam/ACCA_Global/Technical/oil-gas/ea-stranded-
assets.pdf.
Integrated reporting and climate change: A perfect marriage. https://www.ifac.org/global-
knowledge-gateway/business-reporting/discussion/integrated-reporting-and-climate-change.
Kiymet Tunca Caliyurt CPA, CFE, graduated from the Faculty of Business Administration at
Marmara University, Istanbul, Turkey. Her Masters and Ph.D degrees are in Accounting and
Finance Program from the Social Graduate School, Marmara University. She has worked as
Auditor in Horwath Auditing Company, Manager in McDonalds, and Finance Staff in Singapore
Airlines. After vast experience in private sector, she has started to work in academia. She is
holding CFE and CPE titles. Her research interests are in accounting, auditing, fraud, social
responsibility, corporate governance, finance, and business ethics, with a special interest in
aviation management, NGOs, women rights in business. She has been as visiting researcher in
Massachusetts University Amherst Business School. She is the Founder of the International Group
on Governance, Fraud, Ethics and Social Responsibility (IGonGFE&SR) which was founded in
2009. In 2009, she also founded the International Women and Business Group, which organizes
global, annual conferences. Kiymet has published papers, book chapters, and books both
nationally and internationally on fraud, social responsibility, ethics in accounting/finance/aviation
disciplines in Springer and Routledge. She is book series editor in Springer with the title
Accounting, Finance, Sustainability, Governance, and Fraud: Theory and Application, and book
series editor in Routledge with the title Women and Sustainable Business. Some book titles:
Emerging Fraud (with Sam Idowu), Corporate Governance: An International Perspective (with
Sam Idowu), Women and Sustainability in Business: A Global Perspective, Sustainability and
Management: An International Perspective (with Ulku Yuksel), Globalization and Social
Responsibility (with David Crowther), Regulations and Applications of Ethics in Business
Practice (with Dr. Jiang Bian), and Ethics and Sustainability in Accounting and Finance, Volume I.
She is acting as member in editorial board Journal of Financial Crime, Social Responsibility
Journal, International Journal on Law and Management, Journal of Money Laundering Control.
She is a regular speaker at International Economic Crime Symposium in Jesus College, Cambridge
University. She is member in editorial board Social Responsibility Journal, Journal of Financial
Crime, International Journal of Law and Management. She is a partner of Herme Consulting in
Trakya University Technopark.
Part II
New Approaches in Sustainability
Chapter 2
Sustainable Development in India:
A Case Study of Vedanta
Abstract From the time of barter system to the modern era of plastic money, the
mankind has travelled an impressively long journey. Undeniably, “profitability” has
been the major source behind all the efforts being made by the business in particular
and society in general. This profit motive has not only benefited in the form of
growth and development of present and future generation but has also supported the
growth of cut throat competition and business rivalries which has threaten the
peaceful co-existence of business and society. Hence, business houses have realized
that they would have to raise over and above the profitability and take care of all
those associated with their survival in the society directly or indirectly. This real-
ization resulted in the evolution of the concept of Sustainable Development. This
research paper moves around developing an understanding about the Sustainability,
exploring into its concept and finding out its scope taking the case study of the
Vedanta which has demonstrated the sense of responsibility towards the upliftment
of common masses and protection of the environment and sustainable development
of the nation for today as well as tomorrow.
Keywords Sustainable development Economic growth Sustainability
Economic development Social welfare Social development and vedanta
2.1 Introduction
R. Jatana
UCCMS, MLS University, Udaipur, Rajasthan, India
M. Barodawala (&)
ICSSR, MLS University, Udaipur, Rajasthan, India
e-mail: [email protected]
additional burden not only on the aggregate resource base of the economy harming
the environment but also the need and interest of the future generation. In order to
overcome this problem, economists and business houses come up with an idea of
economic development along with sustainability which they termed as Sustainable
Development.
The concept of Sustainable Development is a process of economic development
which not only concentrates on the needs of present generation but also works to
safeguard the interest and ability to meet the needs for future generation. Hence, it
is assumed that the Sustainable Development is broader in scope and has greater
significance in comparison to Economic Development as it talks about environment
in general and exploitation, allocation and utilization of environmental resources in
particular.
The previous studies and research on sustainability seem heavily focused on the
developed western markets (ef. Birch 2003; Moon 2002; Regelbrugge 1999).
However, reliability of these findings is often inappropriate on emerging Asian
markets, and sustainability research focusing exclusively on the emerging market
setting is insufficient (Sharma 2002). Moreover, empirical evidences from existing
literature support the assumption that the firms in the emerging Asian markets are
lagging behind in their sustainability agenda in comparison of Europe (ef. Welford
2004). However, the potentiality of such incidental studies is wide in range, and
they are expected to contribute significant outputs. Hence, with a view to further
assimilate the sustainability agenda in the core business research as well as practices
and generate a solid base of empirical evidences, it is crucial to expand sustain-
ability research in India, which is not only one of the highly emerging Asian market
but also one of the fastest growing economies of the world. Indian economy has
been undertaking the planned efforts to speed up its economic development. This
necessitates assessing the state of Sustainable Development in India and the efforts
of the state of Indian economy in this direction. It is against this overall backdrop,
the present paper endeavours to the empirical evidences of Sustainable
Development with reference to Vedanta, the only Indian natural resources company
with a Sustainable Development Report.
The main purpose and objective of this paper is to know how the Vedanta has
achieved Sustainable Development; what specific activities, programs and strategies
it has set, devised and implemented for the same.
In recent years efforts have been made to map the terrain of Sustainable
Development in the way it is being practised and perceived in India. However,
consultants (Kumar and Balsari 2001; British Council et al. 2002) and non-profit
organizations (CSM 2001; PiC 2004) have mainly conducted studies exploring
corporate level Sustainable Development in India. Apart from a marginal instance
2 Sustainable Development in India: A Case Study of Vedanta 15
According to Chong (2002), the post independence history of Indian economy can
be divided into three phases. The first phase (1947–1966) was motivated by the
goal of building a solid industrial base (Sawhney 2004) and was characterized by
nationalization of heavy industries. This led to a highly centralized economy
(Davies 2002) and saw a rapid growth in capital intensive manufacturing plants.
While featuring protectionism for these home-grown industries (Nag et al. 2003),
the national 5-year economic plans did not have any provisions to offset environ-
mental damages, and as a result industrial base came at the cost of ecological
capitals (Sawhney 2004). However, corporate philanthropy practices flourished
during this period (Mohan 2001), contributing in building a firm base for the social
sustainability efforts in later years. The second phase of development (1966–1991)
shifted its focus back on the traditional agrarian society and exhibited the mod-
ernization of Agricultural Production Technologies (Chong 2002). Protectionism
continued, and MNCs faced many restrictions in their activities (Nag et al. 2003). In
the 1970s, India began to adopt industrial pollution control measures, and the first
set of environmental regulations began to emerge (Sawhney 2004). However,
implementation and enforcement of these laws have not been comprehensive. The
Ministry of Environment and Forests was established at the wake of the Bhopal
disaster in 1984. The Environmental Protection Act was enacted in 1986, followed
by a number of related environmental regulations (Divan and Rosencranz 2001).
The third phase in 1991 brought great economic reforms in India, with the home
market finally opening up to the world economy (Chong 2002). This liberalization
also the government officially including Sustainable Development in the growth
agenda (Sawhney 2004). As a result, domestic environmental protection policies to
revert the damages done over the previous four decades were formalized in an
Environmental Action Plan (Sawhney 2004). India’s accession to the World Trade
Organization (WTO) meant that Indian firms also thrived to meet international
benchmarks in their operations, products and processes (Ghoshal et al. 2001).
Greater level of privatization thus resulted in increased foreign trade, meeting the
international ecological and social sustainability standards.
16 R. Jatana and M. Barodawala
Empirical evidence also shows conflicting evidence on the role of MNCs in this
context. Ruud (2002) opines that the multinational corporations in India are the
drivers of the sustainable development agenda. They act in a more environmentally
sustainable manner than local companies do and follow stricter standards in
accordance with their headquarters in the West. As a result, sustainable business
practices often threaten the competitive advantage for the MNCs that are more
responsible. However, Mohan (2001) finds no discernible differences between the
sustainable development policies of MNCs and local companies in India. This
finding is corroborated by Sawhney (2004).
The survey by Kumar and Balsari (2001) reveals the existence of the general
perception that “MNCs are not giving their due to the Indian society” (Kumar et al.
2002, p. 1). Thorpe and Prakash Mani (2004) essentially convey the same message
in a more neutral tone, saying that a MNCs in India view sustainable development
only as a risk management issue, with little integration in the core management
practices. Another study shows that MNCs in India only practise sustainable
development partially and hardly engage in policies and practices in tune with their
parent companies in Europe. Kumar et al. (2002) opined that very few MNCs
actively pursue sustainable development measures and reported that the public
perception of MNCs concerning trustworthiness in general is very low. In fact,
MNCs rated responsible in India were graded upon their good quality products and
services’, ‘trusted brand’, ‘good company’ and ‘personal knowledge about the
company’ and not based on the social and environmental performances (Kumar
et al. 2002). To sum up, although there have been some specific initiatives taken by
certain corporations, the propagation still seems restrained and chaotic. Therefore,
the roles of (both local and multinational) corporations in India with relation to
sustainable development remain ambiguous, vague, controversial and unsolved.
The existence of conflicting evidences (e.g. Ruud 2002; Kumar and Balsari 2001)
among studies from Indian companies clearly shows that their role in the context of
sustainable development is yet to be determined.
The company was established by Anil Agarwal in Mumbai (than Bombay) in 1976
by the name Sterlite Industries. Later on, in 1986, he endowed Vedanta Resources
bringing together a variety of businesses owned by the family. It was first listed on
London Stock Exchange in 2003 when it raised $876 million through an Initial
Public offering. Thereafter in 2006, it acquired Sterlite Gold, a gold mining
business. It raised an additional $2 billion through an ADR issue in 2007. In 2008,
it bought $26 billion of the assets of Asarco, a copper mining business. In
December 2011, it announced the US$8.67 billion acquisition of Cairn India, a
subsidiary of Crain Energy, heralding its foray in the oil sector.
The organization seeks to add and share value through everything that they do. As a
business, they make a considerable economic impact; through employment,
payment of taxes, royalties and other contributions to local, state and national
governments. They also build local infrastructure that benefits local communities in
the form of roads, schools and healthcare centres.
They play a significant role in growing local skills and in the development of
local infrastructure, including roads, sanitation, education and medical facilities.
They made a community investment of Rs. 160 crores in 2015–2016, reaching
around 1.75 million people and providing support for schools, hospitals, health
centres and farmers. They also contributed Rs. 20,600 crores to the Indian
exchequer through direct and indirect taxes, royalty and oil tax.
As a responsible corporate citizen, the Company focuses on community devel-
opment through its CSR activities. Their community activity is delivered at a local,
regional and state/national level to ensure that the business is able to effectively
maximize its impact in facilitating socio-economic development. The majority of
18 R. Jatana and M. Barodawala
their initiatives are carried out in collaboration with community organizations and
are developed in partnership utilizing a needs-based approach to community
investment, underpinned by the use of ‘Public–Private–People–Partnership’ (4Ps)
model. Fundamentally, they work to help communities identify their priorities
through externally delivered needs assessment programs and then work closely with
them to design programs that seeks to make progress towards meeting these.
In order to maximize the outcomes and impacts that the business can have, they
focus on the following seven key areas through their community investment
activities.
• Health, Nutrition and Sanitation
These activities include the delivery of medical infrastructure such as the hos-
pitals that run across the group. These hospitals are supported by medical
outreach services, which include mobile health vans and medical outposts to
enable isolated ruler communities’ access to medical services. Ten Ruler Health
Posts and 16 Medical Health Units and other outreach programs covered 1.8
lakh people in year 2015–16.
• Education
The work for children’s education is targeted at the pre-school level, particularly
through VBCA project-Integrated Child Development Scheme (ICDS), which is
the centrally sponsored scheme of the government of India aimed at providing
services to pre-school children in rural, tribal and slum areas in an integrated
manner so as to ensure their proper growth and development. In addition to
pre-school support, they also support a mid-day meal programme through eight
centralized kitchens, aimed at improving the health status of children from
Class I to VIII in government-aided schools as well as encouraging regular
attendance at school.
• Sustainable Livelihood
Farmers are being educated about yield improvements in order to maximize
their returns by providing access to high-yield seeds and fertilizers, soil testing,
watershed management and cultivation. Vocational training to youth in
employable skills imparted through BPO Industrial Stitching benefited more
than 770 youth.
• Women Empowerment
The company is able to assist in creating sustainable development through
supporting initiatives that have women‘s empowerment at their heart. In addi-
tion to bringing women together in collaborative forums, the group dynamics
and collective spirit create informal structures of support helping to create
sustainable small businesses as well as enhancing the bargaining power of
members. The programs cover over 22,000 women including a federation
‘Subalakshmi’ for 2700 women.
• Community Asset Creation
The initiatives enable the planning and development of infrastructure to improve
the lives of communities surrounding the operations, for example creating
several community welfare assets, which include building roads, community
2 Sustainable Development in India: A Case Study of Vedanta 19
centres, wells, classrooms and drainage network across the areas of operation.
The program benefits potentially 1.7 lakh people for whom the assets have been
created.
• Bio-investment
Restoring and improving natural systems is key to the Bio-Investment
Programme. Under bio-investment initiatives, the leftover food waste is con-
verted into organic manure through the organic waste converter plant at mid-day
meal kitchens. Other initiatives include: watershed management, social forestry,
cattle breed improvement and cash crop framing.
• Integrated Village Development
The core objective of integrated Village Development Programme (IVDP) is
enabling the holistic development of villages surrounding the operations.
Under IVDP, villages are identified for assistance, and in collaboration with
NGOs, government authorities and the village, an integrated development plan
is prepared. The plan usually results in the development of infrastructure,
including health and education support, along with environmental planning and
the implementation of Sustainable livelihood programmes. From commence-
ment of the IVDP to handover, the process takes between 3 and 5 years. This
project has matured, and now presently, their intervention is in 2 villages
covering 4000 people.
Sustainable development is a core element of the company’s guiding strategy
and supports their growth as a diversified natural resources company. This includes
the activities they undertake across the operations to ensure the health and safety of
their people; how they make valuable economic and social contributions to com-
munities and regions where they operate; and how they manage environmental
footprint.
Their active engagement and deep understanding of the countries, communities
and environments where they operate, combined with their Tier 1 assets, form the
foundation of their business strategy and position their group to create value for
their shareholders and other stakeholders.
Sustainability model of the company was developed in financial year 2011–2012
which comprises four pillars—Responsible Stewardship, Building Strong
Relationships, Adding and Sharing Value and Strategic Communications—each
designed to support their long-term sustainability as a world-class diversified nat-
ural resource company, providing superior returns to their shareholders. These four
pillars capture the processes and activities they undertake to ensure their future
(Fig. 2.1).
• Responsible Stewardship
Responsible Stewardship means having effective and appropriate business
processes, including robust compliance and risk management, protecting the
health and safety of the employees and responsibly managing the environmental
and social impacts.
20 R. Jatana and M. Barodawala
with their stakeholders in a transparent dialogue. This pillar is the vital element
of sustainable development, in implementing and strengthening their ‘licence to
operate’ efforts. This pillar further reflects their commitment to becoming a more
transparent and responsible corporate citizen.
The fourth pillar Strategic Communications was added in financial year 2014–
2015, which reflects their commitment to becoming a more transparent and
responsible corporate citizen. This also reflects their emphasis on their principles of
community dialogue and mutual respect, including free prior informed consent to
access natural resources.
Governance and Sustainable development are at the core of Vedanta’s strategy
and they provide a platform to promote equal opportunities, with a focus on
Education, Healthcare and Women Empowerment. The approach of community
development is holistic, long term, integrated and sustainable. The community
engagement process, alongside baseline studies and needs assessments, is embed-
ded in the organization through the Sustainability Framework which is aligned to
International Standard like IFC, ICMM and OECD guidelines.
The Vedanta sustainability Assurance Program (VSAP) is used to monitor the
effectiveness of sustainability framework implementation at a group level. The
company positively impact livelihoods, through healthcare, education and skill
development platforms, drawing on the company’s ‘Social Licence to Operate’. The
company demonstrates world-class standards of governance, safety, sustainability
and social responsibility, with a strong commitment to People, Planet and
Prosperity. Their key programmes are the ones in which they support local
governments. In 2015–2016, the company partnered with over 200 NGOs, schools,
academic and government bodies to provide platforms promoting education,
livelihood, healthcare, women empowerment and biodiversity conservation.
Vedanta invested INR 160 crores, to benefit 1.75 million people in India–Africa in
financial year 2015–16.
The company’s Sustainable Development model benchmarks global best prac-
tice and helps them to uphold the consistency in the community investment
approach. The approach draws from UN’s Millennium Development Goals
(MDGs) and at the same time aligns with the development agenda of the country
and resonates with Vedanta’s core values of trust, entrepreneurship innovation,
excellence, integrity, respect and care, aligns with the development agenda of India.
2.4 Conclusion
For bringing back and maintaining the general balance in the economic and social
arena, it is evident to think deeply and act wisely about sustainable development.
Every business house owes some responsibility towards the society, nation and
world in general which provide it with all human, material and natural resources.
Considering the long run growth and sustainable development following the norms
22 R. Jatana and M. Barodawala
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creating islands of environmental excellence in a sea of dirt? Business Strategy and the
Environment, 11(2), 103–118.
2 Sustainable Development in India: A Case Study of Vedanta 23
Sawhney, A. (2004). The new face of environmental management in India. Hants, UK and
Burlington, VT: Ashgate Publishing.
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Renu Jatana was born in Jaipur, India, in 1960. She obtained her M.Com and M.Phil. degrees
from University of Rajasthan, Jaipur. She obtained Ph.D. in commerce from Mohan Lal Sukhadia
University, Udaipur, Rajasthan. Presently, she is the Dean and Faculty Chairman at Faculty of
Commerce, ML Sukhadia University, Udaipur. She has attended and participated two times in
International Conference held at London Metropolitan University, London. She has edited four
volumes of ‘Social Corporate Responsibility’ along with Prof. David Crowther. She has
successfully guided 32 Ph.D. scholars and has over 34 years of teaching experience in commerce.
She has also completed major research project of ICSSR, New Delhi. Recently, she has visited
Thailand for research work on ‘Leadership Qualities of Women executives in India and Thailand’.
Her area for teaching interest includes Business Economics, Banking and Finance, and
International Trade and Finance. She has published a number of research papers and articles in
reputed Indian and International Journals. At present, she is Course director of Master of
International Business. Prof. Jatana is married—a girl and a boy’s mother.
Mehjabeen Barodawala was born in Udaipur, India, in 1988. She is Post-Doctoral Fellowship
scholar from Indian Council Social Science Research in the Department of Banking and Business
Economics at Faculty of Commerce, Mohan Lal Sukhadia University, Udaipur. She has completed
her Ph.D. under the able guidance of Prof. Renu Jatana on the topic ‘A Study on Impact of Various
Promotional Techniques towards Demand Generation among Children’ in 2016. She received
master’s degree in commerce in 2013 and master’s degree in international business in 2011 from
MLS University, Udaipur. She is NET qualified in commerce in July 2012. She has seven years of
teaching experience as a lecturer in the Department of Banking and Business Economics. She also
has interest in the field of international business studies and do take lectures on India’s foreign
trade, international business environment and export-import procedure and documentation. She
has a textbook on Indian banking system published in her name. She has a number of research
papers being published in national and international Journals. Currently, she is also the Director of
The Udaipur Urban Co-operative Bank Ltd., Udaipur. Dr. Barodawala is married—a boy and a
girl’s mother.
Chapter 3
Implementation of Lean Management:
Sustainability in the Construction
Industry: The Case of Brazilian
Companies
3.1 Introduction
The strategic map of 2013–2022 for the Brazilian Industry (CNI 2013) is a study
whose objective is to point the way that industry and Brazil should go in the next
decade to increase the levels of productivity and efficiency and achieve a high
degree of competitiveness, while respecting sustainability criteria. Sustainability
has a direct relationship with the productivity and innovation. Productivity gains
reduce the use of natural resources and eliminate waste. Innovation introduces new
products, processes, and business models that generate less environmental and
social impact.
The productivity of the construction industry is one of the economic indicators
of success, since this sector has a substantial impact on gross domestic product
(GDP) and employment. Studies estimate that a 10% increase of productivity in the
construction industry would result in an improvement of 2.5% of GDP (Ibrahim
et al. 2010).
Brazil’s productivity is still low, compared with USA and European countries
(Bloom and Reenen 2010), and one of the explanations is largely based in the use of
management practices, such as the adoption of lean manufacturing. Energy effi-
ciency is strongly associated with a better level of company management, probably
because good management practices (such as lean manufacturing) tend to save on
energy consumption (Santos et al. 2019).
The construction sector is one of the biggest consumers of energy and natural
resources, as reported in the study Vision Brazil 2050 (CEBDS 2012), inspired by
the Vision 2050 Project—the new agenda for business, of the World Business
Council for Sustainable Development (WBCSD). The two studies have in common
the purpose of presenting the vision of a sustainable future and of how it is possible
to reach it from nine basic themes, one of them named “buildings and built envi-
ronment.” Construction supply chain is responsible for 75% of the extraction of
natural resources, especially water, minerals, and timber, generating about 50% of
the municipal solid waste. The figures of material waste are high and may reach
40%, according to some estimates.
Labor productivity is considered low, and most Brazilian constructions use
inefficient tools and methods and employ labor almost completely without quali-
fication. The exception occurs in large-scale business ventures, mainly in the
capital. The actions, which are intended to be developed until 2020, under the
Vision Brazil 2050 study (CEBDS 2012), include “Reassess the constructive
methods to seek ways to reduce the generation of waste during the entire lifecycle
of the building.”
Considering the importance of the construction sector for the economy and the
challenges raised in the light of the impacts arising from the extraction of natural
resources and waste generation, it is necessary that construction companies from the
State of Rio de Janeiro adopt modern management practices such as lean man-
agement, known as lean construction in the construction industry, to increase
productivity, contributing to a greater sustainability.
3 Implementation of Lean Management: Sustainability … 27
Numerous studies have been developed regarding the integration of lean and
sustainability in the construction industry, compiled by Freitag et al. (2017). There
are also researches using Liker’s Toyota model (2004) applied to the sector. But it
was not found, so far, a study which integrates practices of the lean management
philosophy in the construction sector, with the tools/lean techniques that contribute
to sustainability, considering its deployment. This work aims to fill such a gap, and
it is structured in five sections. This first one contains the context that led to the
development of the study, the second presents a review of the literature, the third
describes the methodology, the fourth brings the results and discussion, followed by
the conclusions in the fifth section and appendix.
Sustainability and lean concepts can be applied to the construction industry, to help
waste minimization. Koranda et al. (2012) examined projects of different sizes and
in different environments in the Midwest of the USA to determine which aspects
hamper the integration of sustainability and lean concepts in the region. A model
for planning the entire construction process was established so that waste can be
reduced and the integration of lean concepts and sustainability is more feasible.
Based on case studies, various aspects of waste in construction projects have been
recognized, and a comparison between the interaction of lean concepts and sus-
tainability was documented. In Koranda’s et al. (2012) model, performance indi-
cators are a prerequisite for designers and contractors to be able to integrate lean
and sustainability concepts.
Ogunbiyi et al. (2014) presented an exploratory study of existing literature and
the results of the use of a questionnaire with construction professionals based in the
UK to explore the contribution of the application of lean construction techniques on
sustainable construction. The global perspective of building industry professionals
showed that 14 benefits are perceived due to the integration of lean construction
principles and sustainable construction within the construction industry.
Regarding the level of use of lean principles/techniques to enable sustainability
in construction companies, 16 principles/techniques were found, in descending
order of level of use: (1) just-in-time, (2) visualization tools, (3) daily huddle
meetings, (4) Value analysis, (5) Value stream mapping, (6) Total quality man-
agement, (7) Fail safe for quality, (8) 5S, (9) Total preventive maintenance,
(10) First run studies, (11) Last Planner, (12) Concurrent Engineering, (13) Pull
approach, (14) Kanban, (15) Kaizen, and (16) Six Sigma.
Ogunbiyi et al. (2014) identified 12 areas of connection between lean con-
struction and sustainability.
The objective of Firmawan et al. (2012) was to present practical examples of
value engineering and lean construction application in the project of a green
building and to evaluate qualitatively its benefits in terms of environmental impact
and waste minimization. The technique of function analysis system was conducted
28 A. E. B. Freitag et al.
3.3 Methodology
This work makes use of exploratory data analysis techniques, to investigate latent
features on the data that indicate possible patterns, trends, or models (de Freitas
et al. 2008). These techniques are used in the data descriptive analysis which must
be performed after collection and typing of data in a suitable database. The work
also made use of multivariate data analysis, which refers to all statistical methods
which simultaneously analyze multiple measures about each individual or object
under investigation (Hair et al. 2009). There are multivariate techniques, solely
designed to deal with multivariate issues such as factorial analysis, which can be
exploratory or confirmatory, and identifies the underlying structure of a set of
variables. Data were analyzed using the software R (R Core Team 2015).
Descriptive statistics were used, including frequencies, percentages, and sets (most
frequent value in the sample), to describe the characteristics of the analyzed sample.
In order to determine the reliability, validity and objectivity (terminology used to
verify the internal consistency of data and check the replicability of questionnaires)
of the collected data, some specific tests were applied as ordinal alpha, the
Kaiser-Meyer-Olkin (KMO) criterion and Bartlett’s sphericity test. For the appli-
cation of factor analysis, the KMO (KMO > 0.50) test and Bartlett’s sphericity test
were used. The main objective of the factor analysis in the case of this work was to
explain the correlation or covariance between a set of variables, in terms of a
smaller number of non-observable variables. These non-observable variables or
factors are calculated by linear combination of the original variables.
The ordinal alpha reliability coefficient proposed by Zumbo et al. 2007) con-
siders as acceptable limit values greater than 0.6. For measurements involving
ordinal data (qualitative data that have a natural ordering of their categories), the
ordinal alpha estimates more precisely the internal consistency than the Cronbach’s
alpha (Corrêa 2012), because it relies on a polychoric correlation matrix (a bivariate
association measure used when the two variables are ordinal with three or more
categories) instead of a Pearson covariance matrix (covariances matrix calculated
for quantitative data). An attempt was made to adjust a confirmatory factor analysis
to check how well the practices were allocated to the four layers of Liker’s Toyota
model (2004); however, due to the small number of experimental units, it was not
possible to proceed with such research. An exploratory factor analysis was then
performed for ordinal data. To determine the number of factors the Kaiser criterion
was used. A Varimax rotation was used to obtain the final factors. The Varimax
rotation is an orthogonal rotation method and wants that, for each major component,
there are only a few significant weights and all the others are close to zero, that is,
32 A. E. B. Freitag et al.
the objective is to maximize the variance between the weights of each major
component, hence the name Varimax. The variables with factorial loads (weights of
variables within each factor in factor analysis) smaller than 0.5 or commonalities
(portion of the variance that a variable shares with all other variables considered, is
also the proportion of variance explained by common factors) smaller than 0.25
were excluded (Filho Salvador-silva and Teixeira 2014). A significance level of 5%
was used for all hypothesis testing.
Most of the 60 respondents (33.3%) have more than 20 years of market experience
and high schooling, i.e., 51.7% with graduate or master’s degree or doctorate.
Bloom and Reenen (2010) state in their study that education is strongly correlated
with high scores in management, if the level of education is considered of both the
managers and the workers, whereas the vast majority of 60 respondents have at
least one undergraduate degree, and it is plausible that the managers are more likely
to be aware of the benefits of modern management practices such as lean
manufacturing.
The companies where the respondents work are mostly midrange (41.7%), have
an operating time of more than 20 years (43.3%) and are located in the State of Rio
de Janeiro (85%). Whereas just near half the companies have more than 20 years of
operation and are medium sized, it is supposed that they have a consolidated
management structure, facilitating the absorption of new knowledge of manage-
ment philosophies like lean construction, both at the management level, as in the
shop floor level.
However, 43.3% of companies know the concept of lean construction, but only
28.8% of them make use of this concept. Of the companies that reported using lean
construction, 47% are medium sized and 35% have more than 20 years of
operation.
The fact that less than a third of the respondent companies adopt the lean
management philosophy, despite having proven operational experience and staff
with good education, supports the perceptions of Bloom and Reenen (2010), that
the slow evolution of management practices—“scientific management” of Taylor,
mass production of Ford, M format corporation of Sloan, Deming quality move-
ment and “lean production” of Toyota—suggests that management practices have a
resemblance to process technologies that diffuse slowly over time.
The slow technology diffusion can have various causes, but a well-studied factor
is the information. New management practices are often complex and of difficult
introduction without the help of staff or consultants with previous experience of
these innovations. The acquisition of skills on modern management practices passes
necessarily by education, namely by the teaching of the concepts and tools of lean
construction, and its integration with sustainability, at technical schools and
universities.
3 Implementation of Lean Management: Sustainability … 33
To achieve the purposes of this research, a table integrating concepts of lean and
sustainability in construction, from the literature review (Table 3.1), was initially
devised. Then a ranking of lean construction practices was structured and finally, a
conceptual framework was proposed, which integrates practices of the lean management
philosophy in construction, with lean tools/techniques that contribute to sustainability.
Table 3.1 Integration between lean and sustainability in construction industry, based on literature
review
References Integration between lean and sustainability in construction industry
Koranda et al. (2012) Proposal of a model, where performance indicators are the essential
condition so that designers and developers can integrate lean and
sustainability concepts
Ogunbiyi et al. (2014) 14 benefits are perceived due to the integration of lean construction
principles and sustainable building; 16 lean principles/techniques
were found to enable sustainability in construction companies; 12
areas of connection between lean construction and sustainability were
identified
Firmawan et al. Identification of critical functions for green design features and
(2012) practices in place that maximizes the concept of lean construction, in
comparison with the conventional construction. Division of lean
construction practices into three groups: reduce waste, reduce
emissions, and reduce water
Nahmens and Ikuma Lean construction as a viable and effective strategy, using several
(2012) case studies to show the effect of lean on the triple bottom line of
sustainability in construction of modular homes
Harper and Hazleton Sustainability and lean construction complement each other in
(2014) building projects. By applying lean principles, utilization of labor and
materials is improved
van Boggelen (2011) Lean manufacturing of autoclaved aerated concrete (AAC) is a
highlight in the modern industry of building materials. Waste
reduction and reuse of energy represent a serious potential for the
AAC industry contribution to a sustainable future
Arayici et al. (2011) Practice of lean project through the adoption and implementation of
building information modeling (BIM), using a socio-technical vision
that considers not only the implementation of the technology, but also
the socio-cultural environment that provides the context for its
implementation. Adoption of BIM technology brought efficiency
gains achieved through pilot projects and the project elaboration
process was improved through elimination of waste and generation of
value
Tykkä et al. (2010) Identification of innovative companies in six European countries
which use molded wood in the construction industry. The common
factor that leads these companies to innovate are business
opportunities that arise from demographic changes in the
environment outside the company, such as environmental
sustainability and affordable housing for low-income groups. The
case studies have established internal prefabrication, including the
development of processes based on lean production to ensure quality
and effectiveness
(continued)
34 A. E. B. Freitag et al.
Lean tools/lean construction 1-Just-in-time 2-Visualization 3-Daily huddle 4-Value 5-Value stream 6-Total quality 7-Fail safe for 8-5S
techniques to enable tools meetings analysis mapping management quality
sustainability (16)
Deployment phases of I I, II, III III II, III II, III III III I
lean tools/techniques (3)
Layers (4) Principles (14)
Philosophy 1-Long-term philosophy X X X X
Process 2-One piece flow X
3-Use pulled system X
4-Level workload X X X
5-Culture of stopping to fix X X X X
problems
6-Standardized tasks X X
Process 7-Visual control X X X
8-New technology acquiring X X
strategy
People and 9-Grow leaders and
partners leadership
10-Develop people and X X X X
teamwork
11-Respect partners and X X
suppliers network
Problem 12-Go see for yourself X X X
solving 13-Decision-making strategy X X
14-Reflection and cont. X X X X X X X
improvement
(continued)
A. E. B. Freitag et al.
Table 3.3 (continued)
Lean tools/lean construction 9-Total preventive 10-First run 11-Last 12-Concurrent 13-Pull 14-Kanban 15-Kaizen 16-Six
techniques to enable maintenance studies planner Engineering approach sigma
sustainability (16)
Deployment phases of III III III III I II, III II, III III Practices (35)
lean tools/techniques (3)
Layers (4) Principles (14)
Philosophy 1-Long-term philosophy X X X X X P1.1.1,
P1.1.2, P1.1.3
Process 2-One piece flow X X P2.2.1,
P2.2.2, P2.2.3
3-Use pulled system X X X P2.3.1,
P2.3.2, P2.3.3
4-Level workload X X X P2.4.1,
P2.4.2, P2.4.3
5-Culture of stopping to fix X X X X X P2.5.1,
problems P2.5.2, P2.5.3
6-Standardized tasks P2.6.1, P2.6.2
Process 7-Visual control X P2.7.1,
3 Implementation of Lean Management: Sustainability …
P2.7.2, P2.7.3
8-New technolgy acquiring X X P2.8.1, P2.8.2
strategy
People and 9-Grow leaders and X P3.9.1,
partners leadership P3.9.2, P3.9.3
10-Develop people and X X X X X X X P3.10.1,
teamwork P3.10.2
11-Respect partners and X X X X P3.11.1,
suppliers network P3.11.2
(continued)
39
Table 3.3 (continued)
40
Lean tools/lean construction 9-Total preventive 10-First run 11-Last 12-Concurrent 13-Pull 14-Kanban 15-Kaizen 16-Six
techniques to enable maintenance studies planner Engineering approach sigma
sustainability (16)
Problem 12-Go see for yourself X X P4.12.1,
solving P4.12.2
13-Decision-making X P4.13.1,
strategy P4.13.2
14-Reflection and cont. X X X X X P4.14.1,
improvment P4.14.2
A. E. B. Freitag et al.
3 Implementation of Lean Management: Sustainability … 41
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Alberto Eduardo Besser Freitag is Doctor of Civil Engineering Management, Production and
Environment from Fluminense Federal University (UFF), Master in Business Management by
Ebape/Fundação Getúlio Vargas (FGV-RJ), Post-graduated in Marketing and Mechanical
Engineer from Pontifícia Universidade Católica do Rio de Janeiro (PUC-RJ). He is certified
with Lean Six Sigma Black Belt. He has a solid experience in enterprise networking organizations,
support to entrepreneurship, technological services, beverage industry and engineering, occupying
management positions for over 10 years. He is Partner–Director of BD Gestão Sustentável, with a
career built on the Federation of Industries from the State of Rio de Janeiro, Coca-Cola Brazil,
Jaakko Pöyry Engineering and Varig airlines. He is highly specialized knowledge in lean
management, as well as extensive experience in the areas of people, project and process
management, executive education, strategic planning, preparation of studies, technical and
economic feasibility analysis, manufacturing, quality and engineering. He is fluent in Portuguese,
English, Spanish, and German, with activities developed at international level.
Academically, he has articles published in scientific journals, book chapters, and conference
proceedings. He develops research in association with researchers from UFF, State University of
Campinas (UNICAMP) and universities of Chile, Germany, and Turkey. He participates at master
defense committees on UFF and undergraduate at Federal University of Rio de Janeiro (UFRJ).
Reviewer of journal and conferences articles, Co-Supervisor of undergraduate and masters
students at UFF. He teaches classes and lectures at UFF for students of the Master’s degree in
Management Systems, Doctorate in Sustainable Management Systems, and Master and Doctorate
of Production Engineerig. He is Professor of graduates at FGV-RJ on IDE Management and at
IDCE Business School. His main research themes are related to lean manufacturing, adminis-
tration, sustainability, innovation, and entrepreneurship.
Sergio Luiz Braga França is Doctor in Civil Engineering (UFF), emphasis in management,
production, quality, and sustainable development; Master in Civil Engineering (UFF); Graduate in
Civil Engineer (UFF); Professor at the Doctoral Program in Sustainable Management Systems
(PPSIG UFF); Professor at the Master Program on Management Systems (MSG UFF);
Occupational Safety Engineer (UFF); Coordinator in the Innovation Center and Technology for
Sustainability (NITS /UFF); Coordinator of MBA LATEC/UFF. He is Reviewer of journals and
academic events.
44 A. E. B. Freitag et al.
Marcelo Jasmim Meiriño is Professor at Fluminense Federal University (UFF) in the School of
Engineering; he Professor in the Doctoral Program in Sustainable Management Systems (PPSIG
UFF); Professor in the Master’s Program in Management Systems (MSG UFF); Ph.D. in Civil
Engineering, emphasis on management, production, quality, and sustainable development.
Architect and Urban Planner; Master in Civil Engineering; Occupational Safety Engineer;
Coordinator in the Innovation Center and Technology for Sustainability (NITS/UFF); Specialist in
Sustainability and Energy Efficiency in Buildings; Member of the Social Responsibility
Commission of the Brazilian Institute of Oil, Gas and Biofuels (IBP); Coordinator of the
National Congress on Management Excellence (CNEG); Reviewer of journals and academic
events; and Researcher and Consultant.
Chapter 4
The Importance of Sustainability
and Sustainability Reporting
Abstract In the 1980s, voluntary and compulsory social and environmental reports
began to be prepared. Thus, it was understood that the global market needed reports
that included not only financial information but also non-financial information. The
economic and technological contributions of business have been criticized for
causing social and environmental problems over time. Issues such as environmental
pollution, resource consumption, waste materials, product quality and safety, em-
ployee rights, and social responsibility have gained importance. The necessity of
establishing sustainability culture in the businesses was born. Following the busi-
ness scandals, corporate social responsibility and corporate sustainability have
become important along with corporate governance principles. The concept of
corporate social responsibility has gradually been replaced by the concept of
sustainability, and instead of corporate social responsibility reports, sustainability
reports have been published. In the sense of sustainability, business activities need
to be reported with social, economic, and environmental consequences. Corporate
sustainability, which is called business sustainability, deals with economic,
environmental, social, and managerial issues. Developments related to corporate
sustainability are also followed by sustainability reports. The episode consists of
two subheads. In the first subhead of the study, information was given on the
concepts of sustainability, sustainable development, and corporate sustainability.
Under these heads, the dimensions of sustainable development, the elements and
theories that contributing to corporate sustainability and the principles of corporate
sustainability are explained. In the second subhead of the study, information was
This study was adapted from a Ph.D. thesis which was named as “Sustainability Reports In
Turkey’s GRI Scope And Proposal For Reporting For SMEs”. In addition, it has been supported
by TÜBİTAK, the Scientific and Technological Research Council of Turkey, under project
number 215K361 within the TÜBİTAK 3001 Program as the project output of the study named
as “Current State of Sustainability Reports in Turkey and Sustainability in SMEs”. We are
grateful to the TÜBİTAK unit and its employees who provided scientific and financial support
for the evaluation of the project application, its worth to be supported and during the realization
of the project.
Keyword Sustainability Dimensions of sustainability Corporate sustainability
Sustainability reporting Sustainability measurements
4.1 Introduction
The concept of sustainability whose root is based on the Latin word “sustenere” is
defined in different ways in the literature. Sustainability is the careful use of re-
sources in agriculture, tourism, architecture, business, and the economy(Gladwin
et al. 1995, p. 877). According to Beyhan and Ünügör (2005), this concept, which is
used in many different areas, is about the future of humanity and means to protect
human resources for the future (p. 80).
The concept of sustainability emerged for the first time in 1960s. Rapid capitalist
growth after the Second World War caused negativities on the ecological balance
and the link between development and environment emerged and as a result, the
concept of sustainability gained importance (Altunbaş 2008, p. 5). The globaliza-
tion which has taken place in the twentieth century, while new opportunities to
improve the quality of life, information sharing, and access to technology caused
economic growth, also created new risks. All these make sustainable development
important. While advances in knowledge and technology provide economic growth,
social relations help resolve the risks and threats to the environment and the
economy. It is therefore expected that the sustainable development can be attained
if economic, social, and environmental sustainability is provided (Özer 2010,
pp. 4–5).
Sustainability in terms of businesses is to evaluate economic expectations in a
balanced way with environmental and social sensitivities. Therefore, businesses are
responsible not only to their shareholders or investors but also to all stakeholders
and include the concept of sustainability into management policies. It can be said
that the businesses that comply with the concept of sustainability have become
advantageous compared to their competitors.
Overtime, the purpose of the sustainable development has gone beyond its
original definition and turned into sustainability of resources for maximum profit. In
order to avoid this, sustainability indicators have been developed by the United
Nations Commission on Sustainable Development (UNCSD). These indicators
measure how far progress has been made in achieving sustainable development
from economic, environmental, and social aspects.
The main economic indicators representing sustainability developed by UNCSD
are explanations of economic structure, consumption, and production patterns.
Environmental indicators include descriptions about atmosphere, soil, ocean, sea
and coasts, water, and biodiversity. Social indicators are explanations about
equality, health, education, housing, security, and population (Özmehmet 2008,
pp. 12–16).
The topic of corporate sustainability has been frequently discussed in recent years.
There are two important developments that lay the groundwork for the emergence
of this concept. The first one is the Brundtland Report published by the World
Environment Development Commission in 1987 and the second is the concept of
triple bottom line that emerged in 1990s. The Brundtland Report emphasizes the
efficient use of resources. In the concept of triple bottom line, it is stated that
economic sustainability in the short term can bring success but it will not be
sufficient in the long run alone. Social and environmental sustainability is also
important for long-term success in economic sustainability (Besler 2009, pp. 1–3).
The definition of sustainability approach at the business level is corporate sus-
tainability. According to Şenal and Aslantaş Ates (2012), efficient use of economic,
environmental, and social factors by businesses to provide long-term benefits
provides corporate sustainability (p. 85). If the business provides sustainability,
then the sustainability of the sector and therefore the country and the world is
ensured.
According to Dyllick and Hockert (2002), corporate sustainability as a mix of
ecological and social sustainabilities requires the corporations to focus on long-term
gains rather than short-term gains (p. 132). According to Hahn and Scheermesser
(2006), rather than merely producing and creating value for the economy, busi-
nesses provide corporate sustainability by eliminating or reducing the negative
50 Z. Şahin and F. Çankaya
externalities that they generate during their normal activities (p. 151). According to
Tokgöz and Önce (2009), businesses are also investing in future while learning a
new business model to ensure corporate sustainability (p. 267). Businesses can
provide corporate sustainability by developing strategies and approaches to reduce
damage to the environment during the manufacturing process (Yavuz 2010, p. 64).
What encourages the businesses to promote corporate sustainability is the in-
creases in brand value, trust and reputation and motivation of personnel that result
in increased profits, sustaining competitive advantages and the facilitation of
financial support opportunities from international investment corporations (Kuşat
2012, pp. 229–230). Businesses now attach more importance to social responsi-
bility activities in order to separate themselves from fraudulent businesses. For
businesses, not only profitability and shareholder shares, but also corporate social
responsibility (CSR) is important.
Corporate sustainability, corporate social responsibility, and corporate gover-
nance are inseparable concepts for businesses. The concept of corporate social
responsibility is gradually being replaced by the concept of corporate sustainability,
and instead of corporate social responsibility reports, sustainability reports are now
being published. Corporate governance as a corporate sustainability strategy
focuses entirely on financial sustainability. After big business scandals, corporate
governance has become very important for businesses. Corporate governance re-
ports have become important in investors’ decision making (Aras and Crowther
2008, p. 440). With global crises, corporate management is the way to sustainability
of corporate success. Corporate governance firms provide businesses with risk
management for both maintaining their assets and preventing crises they may
encounter. In other words, through corporate governance, the financial goal that is
determined for sustainability is achieved by ensuring business continuity, more
ethical and proper business practices and avoiding risks (Sancar 2013, pp. 74–81).
Therefore, a good corporate governance will promote sustainability in general (Aras
and Crowther 2008, s. 441).
Corporate governance is the assurance for sustainability of business perfor-
mance. Corporate governance implies that the management and controllers of the
business are transparent, accountable, fair, responsible, and reliable. So when all
these principles are met, sustainability will be ensured. It is important to monitor
and control all the other factors that target the profitability of the business in the
new understanding that the profit is not the only factor that maximizes the business
value. Corporate governance is therefore a reassurance for the sustainability of
business processes (Demirkaya 2014, p. 135).
4 The Importance of Sustainability and Sustainability Reporting 51
considered part of the answer (Demirkaya 2014, p. 120). Businesses are also
involved in many different segments of the society when they operate in the en-
vironment they are in. All parties that are involved in the business in the society,
affected by the activities of the business and affecting the business by its activities
are called “stakeholders” (Doğru 2012, p. 21). It is very important for the success of
the business to establish good relations with its stakeholders. It is aimed to take into
account the expectations and needs of all stakeholders when carrying out the ac-
tivities of the businesses (Özalp et al. 2008, p. 70).
Corporate Accountability Theory
The concept of accountability states that businesses should be affected by their
external environment in their activities and be held responsible for these activities.
It means that the business has a responsibility of proving the correctness of the
decisions taken within the business and is held accountable. Accountability and
transparency are interrelated concepts. The fact that the business activity reports are
in conformity with the truth is based on the principle of transparency, while the
proof of the validity of the decisions taken is related to the accountability principle.
The scope of accountability which requires management accountability only to
business shareholders in a traditional management approach has been extended to
the concept of sustainability. More explicitly, it has been shown that businesses
need to meet expectations not only in terms of their financial performances, but also
in their environmental and social performances (Tokgöz and Önce 2009, p. 258).
The share of SMEs in total in the world is over 96%. This ratio is 99% in Germany,
Japan, and France, while it is 99.77% in Turkey. In Turkey, 78% of total
employment, 55% of total value-added, 65.5% of total sales, 50% of total invest-
ments, 60.1% of total exports, 24% of total loans are carried out by SMEs.
Therefore, as the rest of the world, the place of SMEs in the economy is very
important in Turkey. It is known that SMEs play an important role in helping
economic and social developments of countries as they rapidly adapt to the
changing market conditions, have flexible production structures, achieve balanced
growth among the regions, and help reduce unemployment (Ergün 2012, p. 4).
The life span of businesses in Turkey and in the world is getting shorter. 80% of
the businesses in Turkey cannot reach the fifth year and 96% in the tenth year.
While the role of SMEs in the country’s economy is so important, the sustainability
of businesses, especially SMEs’ life spans, is at the forefront. For this reason,
ensuring sustainability in SMEs presents an important problem. The most important
reasons why SMEs cannot achieve sustainability are corporate and managerial
problems. SMEs are lagging behind in sustainability performance all over the world
as business size is a very important factor in sustainability performance.
The issue of preparing sustainability reports is also of utmost importance for
SMEs. Stakeholder demands have increased for sustainability reporting. SMEs had
to prepare sustainability reports in order to keep up with competitors. Sustainability
reports provide SMEs with the opportunity to tell their own positive business
stories, ease of financing, advantages in risk management in the reporting process,
product and process renewals, as well as being able to distinguish SMEs from
competitors (Grandar and Purcell 2012, pp. 5–6).
The sustainability reporting approach is basically divided into two. These are
voluntary and compulsory reporting approaches. The voluntary reporting approach
4 The Importance of Sustainability and Sustainability Reporting 55
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4 The Importance of Sustainability and Sustainability Reporting 59
Zeynep Şahin was born in Rize in 1981; he completed his primary, secondary, and high school
education in Trabzon. He started his studies at the Black Sea Technical University, Faculty of
Economics and Administrative Sciences, Department of Business Administration. In 2005, he
started as Lecturer at the Black Sea Technical University, Vakfıkebir Vocational School,
Department of Accounting and Tax Applications. In the same year, he earned a master’s degree in
the Department of Econometrics at the Black Sea Technical University, Institute of Social Sciences
and completed his master’s degree in 2008. He served as head of department between 2005 and
2008. Between 2008 and 2010, he served as Assistant Director. In 2017, he completed his
doctorate at the Black Sea Technical University, Institute of Social Sciences, Department of
Business Administration. Zeynep ŞAHIN, who still continues to serve as Lecturer at the Black Sea
Technical University, Vakfıkebir Vocational School, is married, a boy and a girl’s mother.
Fikret Çankaya was born in 1966 in Trabzon; he went to the elementary school at The Bakirköy
Ahmet Hamdi Tanpinar elementary school in Istanbul, the secondary school and the high school at
The Küçükçekmece High School in Istanbul. He received his B.A. degree in Economics from the
Black Sea Technical University in 1990. Following his graduation, he started to study toward the
degree of M.B.A. and became a Research Assistant in 1992 at the Black Sea University. He
received his M.B.A. degree in 1993 with the thesis named The Fund Creating Capacity and
Financial Analysis in the Insurance Sector. He enrolled the Ph.D. program in 1994 and graduated
in 1999 with the thesis titled Evaluating The Quality Costs With the Accounting Focus and The
Quality Costs Applications in Turkey at the department of Business Administration at the same
university. He became Assistant Associate Professor and Associate Professor in 2001 and 2010,
respectively, and then he became Professor in 2015 at the same university. He worked as Vice
Dean at the Communication Faculty between the years 2006–2010 and Vice Chair at the
department of business administration for the period between 2013 and 2015 at the same
university. He has been Faculty Member at the same university since he got his Ph.D. degree.
Chapter 5
Sustainable Development and Industry
Revolutions
Abstract The Industrial Revolutions are mainly divided into four groups which are
Industry 1.0, 2.0, 3.0 and 4.0. It is obvious that the previous revolution triggers the
new one and the process of entering the Industrial Revolutions differs from country
to country. The importance of sustainability has systematically emerged for all
nations, and 17 basic goals have been identified by the United Nations for leaving a
better world for future generations. Therefore, the process of Industrial 4.0
revolution will make better contributions in achieving SDGs with more efficient use
of natural resources, human power and the advance technology.
5.1 Introduction
The World Economic Forum in 2016 divided the Industrial Revolutions mainly into
four groups as the First Industrial Revolution, the Second Industrial Revolution, the
Third Industrial Revolution, and the Fourth Industrial Revolution. Recently, the
same historical Industrial Revolution process is also categorized as Industry 1.0,
2.0, 3.0, and 4.0. When the revolutions are examined, it is obvious that previous
revolution triggers the new one. Also, when the development processes of the
countries are examined, the process of entering and completing the Industrial
Revolutions differs from country to country. The UK was the leading country for
the Industry 1.0 with its iron and coal reserves; however, Germany with its strong
technology has led the Industry 4.0 and the countries which are unadaptable for the
Industry 4.0 will gradually disappear from competitive world markets. The energy
demand depending on mechanization in production increased during the all
M. O. Dinçsoy (&)
Department of Economics, Faculty of Economics and Administrative Sciences,
Trakya University, Edirne, Turkey
e-mail: [email protected]
Industrial Revolutions. Fossil fuels were mainly used in the First and the Second
Industrial Revolutions and renewable, clean or green energy technologies addi-
tionally gained importance in the third and the fourth Industrial Revolutions. The
concept of sustainability has systematically emerged in all these industrial devel-
opment processes by indicating natural resources are limited and exhaustive. The
United Nations Development Program (UNDP), which is the global development
network of the United Nations, identified The Sustainable Development Goals
based on the common action of all countries and 193 countries signed the 2030
Sustainable Development Goals in January 2016. For leaving a better world for
future generations, 17 basic goals have been identified, including poverty reduction,
climate change—disaster risk, economic inequality, and democratic governance—
peacebuilding. From the perspective of sustainability, unlike other Industrial
Revolutions, Industry 4.0 process will make contributions in achieving these goals
with more efficient use of natural resources, human power, and the advance
technology.
With the Industrial Revolution in the nineteenth century, agriculture using tradi-
tional methods (done by human and animal power) was replaced with harvesters
and, consequently, the transition from a production style using manpower to a
production style using mechanical power started. All these developments first
spread to Europe and then, to the whole world, beginning to enhance people’s level
of wealth. The increase in welfare brought along new socio-economic develop-
ments. The world population started to grow faster. The number of factories and
people working in these factories increased. Industrial cities began to emerge.
Railway networks enabled the transportation of food, raw materials and energy
resources needed by people and production.
While environmental, demographic, social and economic adversities triggered
by intense industrialization and industrial development became the current research
subjects after the 1960s, it became a necessity for all countries to take common
steps for the future of the world. In this context, the Club of Rome that was
established in 1968 and is still an active organization in the international arena
commissioned to an MIT (Massachusetts Institute of Technology) team led by
Meadows to prepare a report titled “The Limits to Growth” in 1972. In the report,
the MIT team determined five fundamental factors—population growth, food
production, industrialization, depletion of natural resources and environmental
pollution and examined the relationships between them. In the report, Meadows
et al. stated that mankind’s life on Earth will end within the next hundred year if the
world’s population continues to grow in its current rate, industrialization and
economic growth rate continue unchanged, food products are not diversified, new
natural resources are not found to sustain production mechanism, and no cure is
found to stop environmental pollution/degradation (1972, pp. XI–XVIII).
5 Sustainable Development and Industry Revolutions 63
1
In the Our Common Future Report (Brundtland Report) published by the World Commission on
Environment and Development (WCED) in 1987, sustainable development is defined as “meeting
the needs of the present without compromising the ability of future generations to meet their own
needs”.
2
The United Nations Framework Convention on Climate Change, the Rio Declaration on
Environment and Development, the Convention on Biological Diversity and the Statement of
Forest Principles were prepared.
64 M. O. Dinçsoy
In 1775, an engineer of Spanish origin named James Watt improved the steam
engine, which was an idea that would revolutionize the world. This development
would change the history of humanity entirely. The steam engine was invented
before Watt; however, its areas of use were limited. Watt improved the functions of
the steam engine with a couple of innovations and revealed the extraordinary
potential of the steam. This invention paved the way for one of the three important
leaps in the history of humanity. The first was the discovery and control of the fire,
the second was the transition to farming, and the third was the use of the steam as a
power source. With this invention, the human history entered a new era and mankind
was saved from dependence on muscle strength for the first time while machines
stepped in. From now on, the world entered a period that would change it very fast.
5 Sustainable Development and Industry Revolutions 65
Being a stagnant town prior to the revolution, Manchester came to life with the
power of the steam engine. People from rural areas flooded in the city to work at the
newly established factories. While Manchester was a small market town with a
population of less than 10,000 in the eighteenth century, it reached 89,000 people at
the end of the century and to 400,000 in 1851 while there were 900,000 people in
the city in 1901 (Griffin 2014). Thus, Manchester went down in history as the first
industrial city in the world.
In Britain, the production of manufactured goods doubled in the second half of
the eighteenth century, and there was an even faster growth in early nineteenth
century. While 30% of labour force was employed in manufacturing and mining
sectors in 1801, this rate went up to 40% after 30 years. Thus, Britain became a
country of great urban manufacturing centres dominated by factory systems.
While Britain was having a period of peace in the eighteenth century, France was
preparing for the 1789 French Revolution, and thus, the Industrial Revolution was
delayed in France. Though late, the country underwent the transformation experi-
enced by Britain and joined her in the Industrial Revolution. The French Revolution
was a politically significant development during the Industry 1.0. While France was
the first country to be influenced with the Industrial Revolution, other countries
such as Germany, Belgium, the USA, Russia and Japan were also affected from the
revolution later, and the world entered a process of industrialization at a great speed.
Industrialized countries gained power and helped the spread of capitalist world
order. The use of the steam engine in locomotives and ships following the factories
enabled the industrialized countries to go to distant places and set up colonies. In
addition, the use of paper money instead of coins became popular under the
leadership of these countries. Credit institutions, banks and central banks were
founded, and consequently, industry improved further. Besides, “The Wealth of
Nations” by Adam Smith became an important source for economy and sociology
in this period.
There were few cities in the world about 250 years ago and people used to live
in the countryside. It continued unchanged for thousands of years until the
invention of the steam engine. Following the Industrial Revolution, rural-to-urban
migration increased and many cities were established throughout the world as in the
case of Manchester. Development further accelerated thanks to the railways and
railway networks built in these cities and millions of people moved to the cities in a
short time, consequently paving the way for the emergence of megacities. The
revolution also triggered the greatest mass migrations witnessed in the modern
world. The global economy spread from the centre to the periphery rapidly.
Increasing number of factories and people in the cities created air and environ-
mental pollution. Urban population grew in various countries of the world, mostly
in India, China, Japan and the USA.
Furthermore, there were other changes in economic and social structure
following the Industrial Revolution. Structural transformations took place in the
production process. Traditional manufacturing made on the bench at home was
moved to the factories (Özdemir 2014, p. 52). The spread of railways and water
66 M. O. Dinçsoy
developments concerning the automobile and its transformation into a vehicle that
could be used not only by the rich but also everybody, the automobile became the
main prop of the American economy. With the mass production of the automobile,
the American economy boomed, great highways and bridges were built, and
migration increased. Both internal migration and immigration from every part of the
world to the USA provided cheap labour and thus, national exports, population and
wealth increased.
With these developments led by Ford, two prominent movements emerged. The
first is Fordism which is a production system developed until 1914. As the first
movement of capitalist development, Fordism introduced the assembly line in
production, paving the way for mass production. And there is the second movement
of capitalist development called post-Fordism since the 1970s. This movement
brought along a more efficient approach in satisfying consumer needs with a
flexible production and accumulation regime, resulting in the increase in produc-
tivity (Saklı 2007, pp. 1–18).
In 1945, a group of scientists built a computer called ENIAC for military pur-
poses. The computer used vacuum tubes and was pretty fast compared to its pre-
decessor. With the ENIAC, the transition to electronic computer started and
mechanical hardware gave way to electronic circuits and transistors were replaced
70 M. O. Dinçsoy
The world is currently undergoing is called the age of information technology that
started after the Second World War and gained momentum after the 1970s with the
digitalization of production. We can claim that this revolution coinciding with the
globalization of industry and trade began with the integrated use of electronics and
information technologies.
From the beginning, the most important characteristics of the oil age were
giantism and centralization. Drilling for fossil fuels like oil requires large amounts
of capital, vertical scale economies, top-down command and supervision structure,
because oil trade is not only one of the biggest industries in the world, but also
collecting, processing and distributing energy is a costly business. Furthermore,
automotive, modern finance, energy, telecommunications and construction indus-
tries that emerged from the oil culture have a tendency to grow for having their own
scale economies, and they need large capital and have a central organization just
like the oil industry (Rifkin 2011, pp. 157–158).
The theory that best explains top-down organizational structure characterizing
the first two Industrial Revolutions is trickle-down theory. According to this theory,
if those at the top of the industrial pyramid depending on fossil fuels make profit, a
5 Sustainable Development and Industry Revolutions 71
good deal of this wealth goes to those at the lower steps and thus, everybody in the
economy benefits (Aghion and Bolton 1997, p. 151). In the first two Industrial
Revolutions, those at the top of the pyramid received a very large share compared to
others.
Industry 3.0 occurred at a time when the resources in the world were depleting
very fast. This period gave rise to the idea that the sustainability of the world
became difficult due to the environmental pollution and irresponsible use of
resources as result of the first and second Industrial Revolutions, and thus, urgent
solutions were needed. To protect the natural life and environment and achieve
sustainable development, remedies were sought to prefer renewable energy
resources that are less harmful to the nature instead of fossil fuels and to reduce
energy consumption with technological developments.
In addition, the fact that fossil fuels like coal and natural gas are non-renewable
and will be exhausted and the search for alternative energy resources like renewable
energy have become a significant subject in this period. The availability of
renewable energies in all parts of the world unlike the fossil fuels and their being
free mostly have become the motives to prefer them and introduced ideas to create
local healthy economies.
The significant characteristics of this period are widely and economical use of
renewable energy like solar, wind, ground and hydrogen energies, buildings’
capacity to produce their own energy, development of energy storage techniques,
green economy, transition to zero-emission transportation with electrical trans-
portation systems, and development of opportunities to allow Internet and energy
infrastructures work in concert. Synthetic goods, computer technology, micro-
electronic technology, fibre optics, telecommunications, biogenetics, bio-agriculture
and laser technology have become determining factors in this period.
According to Rifkin (2012, pp. 4052–4057), there are five pillars for Industry 3.0
which are increasing the use of to renewable energy; altering the buildings for green
micro-power systems with renewable energies; distributing the hydrogen and other
storage technologies in the buildings with an infrastructure to store; transforming
the current energy networks into an energy system that is sharable in the continents
just like the Internet network; and replacing the transportation systems to electric
vehicles that can buy and sell through energy network which is smart, interactive
and continental (Table 5.4).
Microcredit3 practice first started in a small village in Bangladesh in the 1970s
by providing loan to 42 destitute women. Due to its successful results, the target
group benefitting from this service expanded and it turned into a microfinance
system adding services to its service range like savings, insurance, and money
transfer (Gökyay 2008, p. 104).
Beginning in the 1990s, large-memory and fast computers, powerful program-
ming languages and operating systems were developed (BilgiUstam 2018).
3
Microcredit is a small capital system extending credit, with no collateral and guaranty, to
low-income women to engage in income generating activities on their own.
72 M. O. Dinçsoy
Core memory used in old computers started to be replaced with magnetic internal
memories, and computer costs have decreased consistently.
TOMs’ system created in 2006 by Texan entrepreneur Blake Mycoskie is an
entrepreneurial trade model. Founded as a social enterprise, it uses the business
model “Buy one, give one”. According to this model, for every pair of shoes sold at
TOMs, a pair is donated to a child in need. Similarly, a portion of the profit obtained
from every eyeglass sold at TOMs is used for the treatment of people with visual
impairment in developing countries (https://www.bulusum.biz/HaberDetay/6). This
business model has been adopted by the firms, enterprises and consumers desiring to
have both commercial and social value in the business world.
The concept of carbon footprint and its reduction has also gained importance in
this period. Carbon footprint is defined as “the harm created by carbon dioxide
(CO) emission, which is considered as the primary reason for global warming, leads
to the formation of gases causing greenhouse effect and is released to the atmo-
sphere with the use of fossil fuels, as result of energy use for the production of
goods directly or indirectly consumed by individuals and companies” (http://www.
karbonayakizi.com). On the subject, various social projects were prepared and put
into implementation in several parts of the world. For example, projects such as
carsharing and CouchSurfing4 contributed to reduce the carbon footprint of thou-
sands of tourists. Similarly, an international transport network company developed,
marketed and run the mobile application Uber in 2015. Travis Kalanick, Founder of
Wikipedia, wondered if there was any way to enable people to use the same roads
for the purpose of sharing travel time, decreasing costs and reducing carbon foot-
print, and finally developed this model. In the first eight months, the roads and sky
in Los Angeles were saved from 7.9 million miles and 1400 metric ton of carbon
dioxide. Kalanick claims that it will also benefit the passengers in the suburbs
(https://www.uber.com/tr/).
With the technology in our pockets today, and a little smart regulation, we can turn every
car into a shared car and we can reclaim our cities starting today.
Industry 4.0 can be defined as a revolution that emerges with the management of
production processes though scientific methods based on data as well as smart
production methods. According to Economic Forum journal published by the
Union of Chambers and Commodity Exchanges of Turkey (TOBB), while
4
CouchSurfing is a hospitality network based on the idea of using social networks in tourism and
people‘s helping each other. It helps people to get in touch with other people who will host and
show hospitality to them at places they visit (Kaya 2016).
74 M. O. Dinçsoy
industrial production and quality increases with Industry 4.0, raw material waste
will be reduced, scarce resources such as water and electricity will not be used
excessively, and consequently, the natural and environmental pollution will de-
crease (TOBB 2016, p. 18). On the other hand, other discerning characteristics of
this period are the opportunities in marketing strategies offered by technology and
networks. For example, the largest retailer (Amazon) does not have a single store
while the largest accommodation provider (Airbnb) do not own any hotel and the
largest transportation provider (Uber) does not have a single car (Schwab 2016,
p. 170).
Industry 4.0 continues to provide new opportunities in many areas ranging from
the determination of system failures to reducing them, from environmentally
friendly production techniques to resource saving, from sustainability to increase in
productivity, from flexible production to cost reduction and from new service areas
to new business models (Selek 2017). However, this process also has certain
determinants (Rüßmann et al. 2015, p. 2).
The Nine Pillars of Technological Advancement
1. Big data and analytics
2. Autonomous robots
3. Simulation
4. Horizontal and vertical system integration
5. The industrial Internet of things
6. Cybersecurity
7. The cloud
8. Additive manufacturing
9. Augmented reality.
Big data covers all kinds of accumulated data ranging from working sheets to
databases, providers and cloud services. Big data analytics is the process of
examining all data sets collected from different areas such as postings on the
Internet and databases, photograph archives and transactions recorded in the
Internet to organize them in a practical format (Martinek and Stedman 2017). In
addition, this kind of analysis allows organizations to use their data to have new
opportunities. Consequently, it helps them to have more efficient operations,
smarter business moves, higher profits and happier customers (https://www.sas.
com/en_us/insights/analytics/big-data-analytics.html).
5 Sustainable Development and Industry Revolutions 75
Autonomous robots can get information about their environments, work for an
extended period of time without human intervention, move themselves throughout
the operation without human assistance and can avoid situations that are harmful to
themselves or people and property (https://www.robots.com/articles/viewing/what-
are-autonomous-robots). Moreover, this kind of robots is capable of making their
own decisions just like humans and act accordingly. An autonomous robot has the
ability to perceive their environment, depends on programmed decisions to know
this environment and can start a movement or manipulation in that environment
(https://stanleyinnovation.com/what-autonomous-robots/).
5.6.3 Simulation
Companies, suppliers and customers rarely have end-to-end linkage; i.e., most of
the systems are not integrated. This is also true for engineering design, production
and service functions. This system aims to ensure that companies, units and
competences become more compatible with each other with the development of
company-wide universal data integration networks.
IIoT, also known as industrial Internet of things, involves sensor data in industrial
settings, machine learning that uses machine-to-machine (M2M) communication
and automation techniques, and big data technology. Smart machines can capture
data and communicate more accurately and consistently compared to humans.
Therefore, they can enable companies to predict inefficiencies and problems earlier
76 M. O. Dinçsoy
save money and time and support business intelligence work. Furthermore, IIoT has
great potential in terms of quality control, sustainable and green practices, trace-
ability of supply chain and supply chain efficiency in general (Aberle 2014).
5.6.6 Cybersecurity
The concept of additive manufacturing (3D printing) refers the production by the
addition of materials like plastic or liquid resin on top of each other. Thanks to the
advanced technology, adding points are not seen in the product as these are
wafer-thin layers. In this regard, 3D printers are classified differently among
themselves. The most important element causing this difference is the technology
developed specifically for the material (Dirim 2016).
Augmented reality enables to feel and experience a physical setting in the real
world live, dynamically and real time with computer-generated sensory inputs
(http://www.endustri40.com/artirilmis-gerceklik-augmented-reality/). It is consid-
ered that augmented reality will occupy a great part of our lives in the future. Also
5 Sustainable Development and Industry Revolutions 77
5.7 Conclusion
While man, water and steam powers were critical for a weaving loom in the
eighteenth century, the past two centuries witnessed the beginning of an industrial
age in which the need for manpower has decreased with robots taking over pro-
duction while it has become important to be good at efficiency, quality, flexible
production, supply chains and technology as well as having competitive advantage.
Although this revolution has not spread around the world yet, it has brought along
fundamental changes for national economies such as flexible production with
higher added-value and data-based decision making.
While developed and developing countries that have been exploiting resources
for mass production in the second and third revolutions have turned to materials and
energy with the Industry 4.0, the transition to a more productive economy and more
ecological technologies has become a necessity.
The return of manufacturing industry to the advanced economy countries led to
the beginning of a more dangerous scenario for the low-income countries that offer
low-cost opportunities, because low labour cost is no longer a factor that increases
the competitive power of firms. Although it is considered that Industry 4.0 will
provide new professions for people, it is unlikely that it will offer the expected
remedies to unemployment due the growth in world’s population.
Consequently, the concept of sustainability has entered into a process of trans-
formation from its theoretical and conceptual structure until today into a structure
that benefits the environment more, extending to the Internet of things, smart
technologies, smart cities, driverless vehicles, decision-making mechanisms with
big data, sharing economy and healthier individuals who live longer.
References
Meltem Okur Dinçsoy is acting as asst.prof. at Trakya University, Faculty of Economics and
Administrative Sciences. She completed his undergraduate degree at Karadeniz Technical
University, Faculty of Economics and Administrative Sciences, Department of Economics. She
completed her master and doctoral degree in Okayama University, Japan, Graduate School of
Humanities and Social Sciences, Comparative Economics. In field of Economic Development and
International Economics, she has focused on some research subjects which are ‘development’,
‘finance’, ‘climate change’, ‘economic crises’, ‘women’s studies’. In this context, there are
scientific articles published in various domestic and international scientific journals, books and
book chapters, conferences and seminars. She gives undergraduate and postgraduate courses
within the scope of her research subjects and proficiency. She is also an advisor of the student
communities of Trakya Banking Research Society and she has organized various academic/social
trips and meetings for students. She has also experiences as a coordinator in the “Erasmus
Exchange Program” and as an instructor in entrepreneurship projects.
Chapter 6
Sustainability Officer in Indonesia’s
Palm Oil Companies
Abstract The purposes of this study are to investigate the role of Sustainability
Officer (SO) and to evaluate the effectiveness of SO function in Indonesian palm oil
corporations. Using 15 palm oil companies listed in Indonesia Stock Exchange as a
sample, this study is conducted using electronic mail survey using Google Forms
and then followed by content analysis of companies’ annual reports and sustain-
ability reports. Based on Miller and Serafeim (2014) sustainability categorization,
we develop our own framework on sustainability classification to determine the
sustainability stage. Since we employ different method, we only used three of their
five categories to build our sustainability classification, namely SO’s authority,
organizational characteristic-related sustainability and SO’s roles. Using the score
we get from previous step, we determine in which sustainability stage Indonesian
Palm Oil Company is. Most of Indonesian Palm Oil companies have hired SO. Five
of the companies do not have SO or personnel especially given authority to conduct
sustainability-related work. The SO can be found in the middle management level
to top management level of company’s hierarchy. The educational background and
experience of the SO are varied. To sum up, Indonesian palm oil industries are in
the stage of compliance. In other words, the majority of them are still in the early
stage of sustainability. Most of them engage with SO to fulfil the legal requirement
especially the sustainability certification, ISPO (Indonesia Sustainable Palm Oil)
and RSPO (Roundtable on Sustainable Palm Oil).
6.1 Introduction
To solve the social and environmental problems faced by palm oil companies,
Indonesian Ministry of Agriculture’s Directorate General of Plantations
(DHP) issued a regulation requiring palm oil Corporation to adopt sustainability
practice named Indonesia Sustainable Palm Oil (ISPO). The DHP then established
ISPO commission to encourage and facilitate Indonesian palm oil industry to build
sustainable palm oil plantations through the ISPO certification. Under the agri-
culture minister’s decree No. 19/2011, by the end of 2014, all Indonesian palm oil
companies have to obtain the certification. Then, the target for ISPO certification
has been extended to 2017 through Agricultural minister decree No. 11/2015. At
the end of 2017 as required by the ministerial decree, there has been 1037 registered
auditors ensuring that Indonesian Palm Oil companies to conduct ISPO certification
(sawitindonesia.com). However, the ISPO certification implementation as required
in the ministerial decree does not indicate the establishments of SO.
The importance of SO establishment is that it can impact on the firm’s sus-
tainability performance (Peters and Romi 2014a, b; Homroy and Slechten 2019).
Homroy and Slechten (2019) document a positive association between the pres-
ences of specific environmental experience board member and environmental
performance, in the case of lower GHG emission. In addition, using disclosure of
GHG emission, Peters and Romi (2014a, b) show that the presence of environ-
mental committee in the Board and the CSO has positive relation. However,
Rodrigue et al. (2013) concludes that there is no connection between environmental
committees in the Board and environmental performance. Consistent with prior
study, Kanashiro and Rivera (2017) find that the presence of a CSO has negative
association with environmental performance. The mix results of previous studies
can be explained by the work of Miller and Serafeim (2014). They declared there
are three stages of sustainability in a company, namely compliance, efficiency and
innovation. The stage reflects company’s sustainability commitment. The higher the
stage, the more sustainability performance it can be achieved. The SO is gradually
involved in every stage. The highest stage performs the most comprehensive in-
volvement of SO and reveals the highest authority of SO. Therefore, the role of SO
is very crucial in company’s sustainability performance. It can be implied that when
SO does not effectively act his or her role, the company performs poor sustainability
performance.
However, while palm oil companies administer SO in firm’s organizational
structure, environmental and social damages are still happening. Greenpeace reports
Indonesian rainforest destructions for palm oil industries have no sign of slowing
down. In those cases, major brands of palm oil products have been linked by the
NGOs to palm oil companies which destroy the rainforest and exploit people
(https://www.grenpeace.org). Furthermore, NGO specializing in palm oil,
Sawitwatch, reported that violations of human rights are still perpetrated by palm
oil industries (sawitwatch.or.id). In this regard, Nesbitt (2015) reported that a
company with high SO achievement is still facing criticism.
The facts lead us to a question, whether SO in Indonesian palm oil companies
really had performed their roles? With the growing number of Indonesian palm oil
companies hiring SO, supposedly the environmental and social problems are
84 E. Ivada and H. Fauzi
decline. In fact, there is no sign that the problems would lessen. Hence, the purpose
of this study is to investigate the role of SO in Indonesian palm oil corporations.
Also, it intends to evaluate the effectiveness of SO function in the companies.
The next part of this article is divided into four sections. Section 6.2 describes
literature review and theoretical foundation. Section 6.3 explains method used in
this study. Finally, Sects. 6.4 and 6.5 provide discussion and conclusion,
respectively.
Following the description of Eapen (2017), sustainability officer can also become
part of sustainability governance structure which supports an organization to
implement sustainability strategy across the business, manage the achievement of
company’s objective and conduct reporting processes, intensify relations with ex-
ternal stakeholders and ensure overall accountability. Sustainability governance
structure also has many various names. Chief of Sustainability Officer or CSO
(Miller and Serafeim 2014; Peters and Romi 2014b; Kanashiro and Rivera 2017)
and Environmental committee (Peters and Romi 2014b) are terminologies generally
used by researchers to mention such governance structure. While Peters and Romi
(2014b) specifically study sustainability-oriented corporate governance mecha-
nisms (SCGM) focus on the presence of environmental committees on the Board of
Directors and a Chief Sustainability Officer (CSO) among the top management
team, sustainability governance structure in Indonesian palm oil companies has
more variation. Sustainability governance structure is not only found in the Board
and in company’s C level which are part of top management team, but also in the
middle management level with different titles.
Beyond the boards and C-suite level which lay on the top of organization’s
hierarchy, SO is also found in the middle management level. The implementation of
SO in a company depends on its need and resources. There is no single model that
can be applied to all companies in establishing sustainability in corporates’ struc-
ture, so that every company has to customize its best method and procedure which
best fit with its business model structure, resources and level of sustainability
integration into company’s business operation (Eapen 2017). Klettner et al. (2014)
stated there are various terms and levels of sustainability officer established in
corporations. They reported there are 22 firms of ASX 50 companies have board
committee and 6 firms have senior executive committee dedicated to sustainability,
while others have committee commit to manage sustainability concern in the lower
level such as manager. Their names are also varied. Twelve of them have sus-
tainability in their title, 11 firms are called with other name reflecting sustainability
indicator in it, like health safety and environment committee, and other have
6 Sustainability Officer in Indonesia’s Palm Oil Companies 85
corporate responsibility in their title. Hence, the sustainability officer can be found
both in upper level of company’s hierarchy (CSO and environmental committee in
board) and in the lower level (management of sustainability, etc.). The different
roles between those two levels are in the extent of responsibility. While the upper
level of sustainability officer has fundamental obligation to oversee the environ-
mental strategy throughout the organization, the lower level of sustainability officer
is only responsible to manage his or her particular area or production line
(Kanashiro and Rivera 2017).
Although sustainability officer is placed in the top and middle level of corporate
hierarchy, most prior studies conducted concerning the sustainability governance
structure role in the organization is the top level SO’s role (Strand 2013; Miller and
Serafeim 2014; Dixon-Fowler 2017; Peters and Romi 2014a). Organization’s
purpose of hiring SO as one of sustainability strategy is varied. The most common
underlying consideration is perhaps from the Deloitte Review (Peters and Romi
2014b). It provides number of reasons why company should engage in sustain-
ability concerns. It also emphasizes the importance of the board to oversee sus-
tainability concerns throughout the organization (Wagner et al. 2009) which can be
implied as the corporate governance’s role in relation to environmental matter
(Peters and Romi 2014b). Therefore, the main responsibility of top level SO
employed by organization is to encourage the formulation and accomplishment of
sustainability strategy of an organization (Miller and Serafeim 2014). Furthermore,
a corporate governance mechanism is essential to align the interest of stakeholders
and manager. Such mechanisms can be split into external and internal categories.
Board of directors (BoDs) and its composition is one of structures in internal
mechanisms (Crifo et al. 2018).
Indonesian specific regulation for palm oil producers, namely Indonesian
Government Policy for Sustainable Palm Oil Development, forces the industry to
obtain the ISPO certification. ISPO is one of Indonesian government efforts to gain
and ensure sustainability of Indonesian palm oil industry through a sustainable
standardization which is expected to respond allegations concerning environmental
and social problem. Furthermore, it also shows government commitment towards
sustainable palm oil development. The ISPO’s essential focus is to ensure legal
compliance according to the Indonesian laws and regulations which serve as the
baseline of sustainability standards Harsono et al. (2012). The sustainability ex-
pertise personnel might need to conduct the certification process. That is why
perhaps, so many consulting firms offering training for Palm Oil Company staff to
prepare and conduct the certification process both for ISPO and RSPO. Since
without the ISPO and RSPO the company cannot sell its CPO, it has to make sure
that all its operations are sustainable under the certification criteria. And further
action taken by the company is to establish SO in their corporate governance
structure.
However, Rodrigue et al. (2013) indicate that SO does not perform its role
effectively to drive organization’s environmental activities. Contrarily, the SO as
part of governance mechanisms seems to be more like a monitor for management to
ensure that the organization achieves environmental legitimacy (Peters and Romi
86 E. Ivada and H. Fauzi
2014a). Social expectations coming from various stakeholders’ concerns that or-
ganizations have to take a significant part to protect the environment are now
become prevalent (Rodrigue et al. 2013). To respond to the concerns, organizations
need to show their commitment to environmental protection. Thus, SO should be
able to protect their legitimacy and licence to operate (Deegan 2002).
Miller and Serafeim (2014) develop a sustainability stage based on several cate-
gories: CSO authority, organizational characteristic-related sustainability, CSO re-
sponsibilities or roles, impact on CEO involvement in sustainability from CSO
appointment, and who decides where to locate primary responsibility and which
factors affect the decision. The following paragraph will provide explanation on
Miller and Serafeim (2014) sustainability stage regarding the first three categories.
Compliance Stage
The early stage of a company engaging with sustainability is called compliance
stage. Usually, this stage applies for companies participating in sustainability for the
first time. In this stage, the people responsible for sustainability efforts do not hold
the CSO title and do not directly report to CEO or the board of directors. In other
words, some of those companies do not have SO in their organization structure in
this stage. When they employ SO, usually he or she is in the middle management
level.
In some cases, the activities taken by the companies concerning sustainability
efforts are voluntary in nature and outside of SO’s formal job responsibilities. While
in other situations, these tasks are part of his formal task that covers other related
activities. Furthermore, all sustainability-related efforts taken voluntarily are not
coordinated, and no one in the organization has knowledge on sustainability.
During this phase, there is also initiatives coming from employee such as recycling
or green projects thought mostly there is no central coordination as strategic actions.
Efficiency Stage
During this stage, companies employ CSO who directly report to CEO and the
board of directors. The roles or responsibilities of the CSO in this stage are similar
to the earlier stage or compliance stage with one addition, which is educating
sustainability to employees. Their roles are developing strategy, reporting sus-
tainability-related data, embedding sustainability into the organization, determining
the material sustainability issues, learning about sustainability from other compa-
nies and getting involved in educating employees concerning sustainability.
88 E. Ivada and H. Fauzi
Although the roles of CSO in this stage are very similar to the prior stage, there
is a fundamental difference. In the Compliance stage, the CSO tasks are focused on
how to comply with regulation related to sustainability, while in the Efficiency stage
the CSO roles are expanded. In this phase, CSO is responsible to handle stake-
holders’ concerns, maintain or elevate reputation of organization and impact on the
bottom line of the organization trough sustainability-oriented actions such as waste
reduction and resources used efficiencies.
Innovation Stage
In this stage most companies have sustainability committee in their board structure.
This can be inferred that sustainability has achieved higher level of strategic focus,
and the board has put sustainability into their interest. However, unlike the earlier
two stages, the role of SO in this stage is not well reflected from the SO role
classification.
As the SO has reached a new level of sustainability, its ordinary role is declined
significantly. For example, only 75% of SO in this stage has responsibility in
reporting sustainability data. The explanation is perhaps in this stage that companies
had developed integrated reporting which is the responsibility of CFO rather than
CSO. Also for other roles such as embedding sustainability to the organization,
attending to stakeholder relations, and educating employees, learning from external
sources, and managing stakeholder relations are lessening significantly. As the SO
is now in the highest level of organization hierarchy, he or she delegates authority
and decision rights to the lower level such as functional department and local unit
business, and this is probably the cause of the declining role of SO in sustainability
process in the organization. Thus, the main role of SO in this stage is to assist the
development of the sustainability strategy as it evolves into the third stage and to
develop the changes in strategy to support it.
It is in the second and third stages (Efficiency and Innovation) that companies
begin to create the CSO position with more elevated authority. Nevertheless, many
of those who were later assigned to the CSO position are already taking a strong
leadership role in pushing the company from Compliance to Efficiency. Thus, many
of the individuals who now hold the CSO title are actively involved in every stage.
However, the CSO’s roles, responsibilities, and titles could vary across the stages.
6.3 Methodology
This study was conducted using electronic mail survey using Google Forms and
then followed by content analysis of companies’ annual reports and sustainability
reports. Firstly, we searched palm oil company list from Indonesian stock exchange
website (www.idx.co.id) under agriculture sector classification and plantation
subsector section. There are 19 companies listed in agriculture sector based on
JASICA, Jakarta Stock Industrial Classification. One of them, Bisi International
6 Sustainability Officer in Indonesia’s Palm Oil Companies 89
Tbk (BISI), does not have palm oil production activity. Although Dharma
Samudera Fishing Industry Tbk (DSFI) and Magna Investama Mandiri (MGNA)
are in the agriculture sector, those companies do not have plantation criteria. Then
the three companies were excluded from the study. Finally, only 15 of them are in
plantation subsector with one of their business line is palm oil industry. We sent
questionnaire to the 15 palm oil companies. Unfortunately, only two of them gave
feedback by answering our questionnaire. They are AALI and SMAR.
Company’s annual reports from IDX website were then downloaded to support
the first group data. Some of the companies do not have complete annual report in
IDX website. There are some missing years. Therefore, we go to the corporate
website and get the annual report and sustainability report as well. Unfortunately,
not all 15 companies provide comprehensive information regarding annual report
and sustainability report. The most recently annual reports are from the year 2017.
However, the starting year to publish annual report in the website is varied.
Moreover, only some of them provide SR (sustainability Report). The data can be
seen in Table 6.1.
Secondly, we conducted the content analysis from company’s annual report and
SR. Assisted by searching tools provided by pdf, we type organization structure or
management structure in company’s annual report. From the organization structure,
we seek position under sustainability names or other related names such as envi-
ronmental, CSR, sustainability, environment, social and social responsibility. At
this point, we can obtain data concerning the first category, SO authority.
After we get the SO in the organization structure, we type the SO title in
searching box to search SO role in the company. If we cannot have the information
about SO presence and role in the company from AR, with the same way we search
Table 6.1 Annual report and sustainability report available in the IDX and company’s website
Company’s Name CODE AR year SR year
Astra Agro Lestari Tbk AALI 2007–2017 2008–2016
Austindo Nusantara Jaya Tbk ANJT 2010–2017 2016
Eagle High Plantations Tbk BWPT 2011–2017 NA
Dharma Satya Nusantara Tbk DSNG 2013–2017 NA
Golden Plantation Tbk GOLL 2014–2017 NA
Gozco Plantations Tbk GZCO 2009–2017 NA
Jaya Agri Wattie Tbk JAWA 2010–2017 NA
London Sumatra Indonesia Tbk LSIP 2009–2017 NA
Multi Agro Gemilang Plantation Tbk MAGP 2014–2016 NA
Provident Agro Tbk PALM 2012–2017 NA
Sampoerna Agro Tbk SGRO 2016–2017 NA
Salim Ivomas Pratama Tbk SIMP 2009–2017 2014–2016
Sinar Mas Agro Resources Tbk SMAR 2009–2017 NA
Sawit Sumbermas Sarana Tbk SSMS 2016–2017 NA
Bakrie Sumatera Plantations Tbk UNSP 2008–2016 2010–2015
90 E. Ivada and H. Fauzi
in the SR. Unfortunately, not all AR and SR provide information about SO role.
Hence, the next step is to search in company’s website. In this case, Eagle High
Plantations or BWPT provide a video conducted by sustainability director, Denys
Munang, telling us about his role in the company. However, there are some words
we cannot properly catch because the audio quality is not sufficient enough. For two
companies send us questionnaire respond, we combine the information we get from
such response and their AR and SR as well.
Thirdly, from Miller and Serafeim (2014) sustainability categorization (Table
6.2) we developed our own sustainability classification with some modifications
(Table 6.3). It becomes our framework to determined the sustainability stage. Since
we employed different method, we only used three of their five categories to build
our sustainability classification, namely SO’s authority, organizational character-
istic-related sustainability and SO’s roles. Furthermore, while Miller and Serafeim
(2014), based on CSO responses, determined the degree of sustainability in every
stage by using percentage. We did not use the same percentage technique.
Otherwise, we marked the stage by using √ symbol to determine whether certain
stage has the category. This was because we were not able to decide the degree of
every category by using percentage due to the fact that we conducted AR and SR
content analysis, instead of interview.
In CSO roles category, we marked differently. From Table 6.2, it can be seen
that the percentages in Innovation stages are all decreased. Their explanation is that
the CSO in this stage is in the company’s highest level of hierarchy. Therefore, he
or she distributed sustainability roles to his/her subordinate. Then, when we found
that the SO of Indonesian palm oil company is in the company’s highest level, we
marked all roles. This was based on Miller and Serafeim’s final statement: ‘many of
the individuals who now hold the CSO title is actively involved in every stage’.
Next, we valued every mark as 1, again this was because we were not able to
decide the degree of every category. Then, we summed all marks and we had the
total score of each stage. Compliance stage has score of 6. It means that every
company which has score of 6 or below is in the compliance stage. The second
stage has 9 total score. It means that all organizations which have total score in a
range between 7 and 9 are in the stage of efficiency. And every company that has a
score range between 10 and 12 is in the highest stage, innovation (Table 6.3).
Lastly, using the score we get from previous step, we determined in which
sustainability stage Indonesian Palm Oil Company is. For example, when a par-
ticular company has a sustainability score of 7, so we conclude that such company
is in the compliance stage.
Based on the sustainability stage developed from Miller and Serafeim model, the
framework in use for developing the stage of sustainability for Indonesian palm oil
companies can be shown in Table 6.3.
Although there is no perfectly match word by word as in the sustainability stage
classification which we developed in the prior step, we made a decision based on
the text described in AR and SR.
Hence, to reduce subjectivity we employed triangulation method (Jonsen and
Jehn 2009). One researcher wrote sentences or key words she found in the AR and
6 Sustainability Officer in Indonesia’s Palm Oil Companies 91
SR, and based on the sustainability stage classification, gave a tick mark in each
category she thought they match each other. She also wrote down the page number
where she found such category. Next, second and third researcher (a staff) ensured
by giving a mark next to the sign that previous person did after reading sentences
and keywords intended. If all researchers agreed on one category, it means that we
can accept it as a category for certain company. All the three researchers did the
same method and finally, we can get all categories that match with sentences in the
AR and SR. See example on Table 6.4.
92 E. Ivada and H. Fauzi
Table 6.3 Framework for developing sustainability stage in Indonesian palm oil companies
Categories Stage
Compliance Efficiency Innovation
SO’s authority
Person with Primary Responsibility for Sustainability √ √
has the Title of CSO
SO Reports to CEO or Board of Directors √ √
Organizational characteristic-related Sustainability
CEO or Board of Directors Ultimately Responsible for √ √ √
Sustainability
Board Sustainability Committee √
SO’s roles
Sustainability Strategy Development √ √ √
Embedding Sustainability Strategy in the Organization √ √ √
Reporting Sustainability Data √ √ √
Managing Stakeholder Relations √
Employee Education around Sustainability √ √
Facilities Management √
Learning from External Sources √ √ √
Determining Material Sustainability Issues √ √ √
Total score 6 9 12
The SO in palm oil industry has existed since 2009. Among others, they include
AALI, LSIP and SGRO. The names, the levels of hierarchy and width of their
authority of the SO are varied. UNSP has the highest level of SO. This company
places the SO as one of the Boards member named Committee of Environment and
Social Relations. There are some companies that improve the level of their SOs.
Firstly, they place SO in the middle management level, and then they position the
SO in the higher stage. They are ANJT, BWPT, LSIP, SMAR and UNSP. Others,
including SIMP and SSMS, add sustainability team under the SO.
The educational background and experience of the SO are also varied.
Unfortunately, not all data are available in the AR and SR, especially SO who is in
the middle management level. Some of them (AALI, LSIP, SGRO, SIMP, SMAR,
UNSP) are from inside the companies with no sustainability experience before, or
the previous position is no relation with sustainability. Other SOs (ANJT and
BWPT) are from outside the company with sustainability experience. The infor-
mation about SOs with educational background is only provided by one company
(SMAR).
The sustainability score of Indonesian palm oil companies is presented in Table 6.6.
Five of the companies do not have SO or personnel especially given authority to
conduct sustainability-related work, so that those companies are not included in the
table. They are DSNG, GOLL, GZCO, JAWA, and MAGP. In the score of 1–6
range, there are 6 companies. Furthermore, there are only one company which lay
in the score of 7–8 range. At last, three companies place in the highest score range
of 9–12 (Table 6.5).
The names of SO are varied. Ten (ten) of 15 (fifteen) companies (66.7%) have SO
officer in their organizational structure with various names and level. 7 (Seven) or
accounted for 46.7% of them, are in the Top Management Level, while the rest are
in the middle management. AALI, one of the earliest companies employing SO,
94 E. Ivada and H. Fauzi
changes the title of SO from time to time. The latest name is Director in Charge
(DIC) Sustainability and Communication (SCOM). This DIC leads five depart-
ments namely: (1) Corporate Social Responsibility, (2) Foundation,
(3) Communication, (4) Sustainability, and (5) Safety and ISPO.
AALI is not the only one which changes the name of SO over time. ANJT,
BWPT, LSIP, PALM, SMAR, SSMS and UNSP are those which have the
changeable title of SO. Furthermore, there is a trend to lift the level of SO from
middle management to top management level. Among them are ANJT, BWPT,
LSIP, SMAR and UNSP.
Since AALI’s AR and SR do not tell about SO roles explicitly, responses of
questionnaire from the company can be used to explain the roles. From 8 (eight)
roles in the questionnaire, AALI recognizes to have 7 (seven) roles. Furthermore,
from AR we can derive that AALI is a sustainability-oriented company. Although it
6 Sustainability Officer in Indonesia’s Palm Oil Companies 97
has sustainability policies and practices and wins many sustainability awards,
getting the sustainability certification such as ISPO and RSPO is still one of its
sustainability focuses.
There is one company, SMAR, in which the SO has eight roles. In its AR and
SR, we cannot find the match words for 8 roles. However, since SMAR is one of
the two companies giving a response of questionnaire sent, we can easily get the
eight duties based on its answer. In fact, it adds one SO responsibility in our open
answer. It is to work together with other parties to reveal sustainability issues. This
makes the company achieve the highest stage of sustainability.
There are 11 companies which are in the compliance stage of sustainability. Five of
them (33.3%) do not have sustainability officer in their organization structure.
Although there is no SO in their governance structure, the two of them have
sustainability policies, program and practices. However, there is no person
appointed for managing sustainability-related activities. Furthermore, the last three
seem do not engage with sustainability activities although they have CSR programs
(in the form of philanthropic in nature). It means that they are in the early stage of
sustainability or compliance stage. Six (40%) of the compliance stage companies
already have sustainability officer in their organization structure. Their names and
level of hierarchy are varied, as in Table 6.5. Their roles are also varied, but almost
all of them are responsible for developing sustainability strategy and integrating
sustainability strategy in the organization. Surprisingly, only one company (SSMS)
has SO with two roles written in its AR and explanation about its CEO or Board of
Directors ultimately responsible for sustainability. It means that the company takes
seriously the sustainability issue. This situation is in line with the one noted by
Wiengarten et al. (2017) that CEO typically makes company’s strategic decisions
and directions (including the sustainability issue). By holding sustainability
responsibility, CEO can force the entire organization to conduct sustainability
efforts. However, without sufficient description in its Annual Report, conclusion is
hard to make on the SO roles.
In the efficiency stage, there is only one company (7%) which has SO holding
five sustainability roles. The company has a specific title of sustainability officer as
in Table 6.5. Since he is a sustainability director, he directly reports to CEO. SO in
this company have five duties which are sustainability strategy development,
embedding sustainability strategy in the organization, reporting sustainability data,
managing stakeholder relations and determining material sustainability issues.
Although this company is in the efficiency stage, it already has policies and
practices concerning sustainability. Unfortunately, we only can trace five roles
possessed by the SO, so that we place this company in the second stage.
Three companies (20%) are in the innovation stage. The roles of SO in these
companies are consisting of eight responsibilities. The SO is directly reporting to
6 Sustainability Officer in Indonesia’s Palm Oil Companies 99
Fig. 6.1 Percentage of companies’ in each sustainability stage. Source The result of the data
analysed by authors
CEO, and in fact, one of them has sustainability committee in its boards. From
searching for words using the searching tools and explanation in their AR and SR
on the SO’s role, it is found that SO of the companies has eight duties (Fig. 6.1).
6.5 Conclusion
Indonesian palm oil industries are still in the early stage of sustainability as the
majority of them (11 companies accounted to 73%) are in the stage of compliance.
Most of them engage with sustainability officer to fulfil the legal requirement
towards the sustainability certification, namely ISPO and RSPO. The rest are in
efficiency stage (3 companies accounted 20%) and in innovation stage (one com-
pany accounted to 7%), with the different roles of SO ranging from developing
strategy and integrating sustainability in the organization. The low of the sustain-
ability commitment in Indonesian palm oil companies can answer a question why
the environmental and social problem in the industry still exist nowadays, and there
is no sign to decrease.
Theoretical implication of the finding is that the role of SO will determine stage
of sustainability adopted by a company. The more role of SO in a company can be
engaged, the higher the level of sustainability adopted in the company. The finding
then can implicate to management and policy-maker. For the policy-maker (gov-
ernment), the finding could be a base to issue a regulation requesting Indonesian
Palm Oil companies to improve their commitment on sustainability in their oper-
ation. This is especially important for Indonesian that has committed to imple-
menting Sustainable Development Goals. For management, this finding could be a
pressure tool reminds them on the importance of doing the sustainable business by
implementing more roles of SO.
100 E. Ivada and H. Fauzi
This study only determines sustainability commitment stage based on the sus-
tainability officer’s authority and role, as well as organizational characteristics in a
company without considering other categories. Therefore, we suggest that further
study includes other aspects such as the impact of CEO involvement on sustain-
ability and the factors affecting decision to the CSO appointment. For the
methodological perspective, it will be important to extend to use interview of the
SOs to provide a wider picture of their roles.
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Elvia Ivada is a lecturer in the Accounting Education Study Program, Teacher Training and
Education Faculty, Universitas Sebelas Maret of Surakarta, Indonesia. She is now pursuing her
doctoral degree at Faculty of Economics and Management, Universiti Putra Malaysia. Before she
became a lecturer, after she graduated from Accounting Study Program of Faculty of Economics,
Universitas Sebelas Maret in June 1999, she worked in accounting departments in some companies.
In 2002, she became a part of Universitas Muhammadiyah Surakarta as a lecturer in Economics and
Business Faculty until 2008. Then, she joined Universitas Sebelas Maret ever since.
She made some papers contribution in conferences such as Annual International Conference On
Islamic Economics in 2014, and The 5th Sebelas Maret International Conference on Business,
Economics and Social Sciences, in July 2018. She also wrote several opinion articles in National
News Paper, Koran Sindo.
102 E. Ivada and H. Fauzi
Dr. Hasan Fauzi is Professor of the Accountancy Study Program, Faculty of Economics and
Business, Universitas Seberlas Maret. After his graduation from Accounting Study Program of
Faculty of Economics, Uni-versitas Gadjah Mada, in December 1986, he joined at Universitas
Sebelas Maret and became a lecturer in Faculty of Economics. In 1992, he pursued his studies at
the Cleveland University, USA, and conferred with a Master of Business Administration (MBA) in
1993. Dr. Hasan completed his doctoral thesis on Social and Environmental Accounting (CSR) at
the Universiti Utara Malaysia. He is chairman of Governance and CSR Forum under IAI KAPd
and actively involved in addressing CSR issues to the public. He is a director Indonesia Center for
Social and Environmental Accounting Research and Development (ICSEARD) and his editorships
include: Editor-in Chief of Issues in Social and Environmental Accounting (ISEA), Associate
Editor of Social Responsibility Journal (SRJ), member of editorial board for International Journal
of Accounting and Finance (IJAF), and member of editorial board for International Journal of
service Management and Sustainability (IJSMS).
Chapter 7
The Effects of Leadership Styles
on Organizational Trust and Disclosure
of Unethical Behaviors
(Whistleblowing): A Practical Research
Abstract Today, the enterprises can hold sustainable competitive advantage only
through proper guidance of human capital movement. While management is merely
regarded as a medium, leadership also appears as a form of administration, which
leads organizations to success, increases productivity, directs the employees toward
positive psychology while they are carrying out their duties, and ensures that there
is a harmonious flow (Csikszentmihalyi in Akış - Mutluluk Bilimi. Buzdağ
Yayınevi, Ankara, 2017). Within the social context, the leader’s behavioral pattern
that he adopts while dealing with his team shapes his style. Trust acts as a bond that
connects the leader with his followers and that increases the sphere of influence and
success of the leader through organizational success and increasing productivity.
Thus, it is regarded as a medium that will increase the leader’s power of influence
for success and to guide his followers more easily, and that ensures better control of
the followers. The disclosure of unethical behavior in workplace (whistleblowing)
will take shape as a reflection of the leadership style and the way the human capital
behaves when the organizational codes of conduct and legal ethical rules are vio-
lated. For these reasons, these three subjects are included in this study.
Keywords Leadership Organizational trust Whistleblowing
Education sector Packing sector Textile sector
7.1.1 Leadership
Leadership is a social interaction process, where the leader asks for voluntary
participation of his inferiors in order to reach organizational goals. (Bhatti et al.
2012, p. 192–193). Leadership may also be described as a concept where the leader
has a social influence over his inferiors (Cunningham et al. 2015, p. 28). The
leaders play a role in ethical and unethical behaviors of the groups by shaping the
organizational climate and culture. They play this role by creating ethical norms
within the organization (Dinh ve diğerleri 2014, p. 37–38). Thus, the leadership
behavior arises as a combination of personal and social influences. The leadership
style is the behavioral pattern of the leader that he adopts when dealing with his
inferiors. In their study at the University of Iowa, Lewin et al. (1939) suggested
three types of leadership as autocratic, democratic, and delegative leadership (Bhatti
et al. 2012, p. 192–193; Robbins et al. 2013, p. 301–302).
Autocratic Leadership
It can be said that an autocratic leader is a typical X manager. He does not take into
account the high-level needs in Maslow’s theory or the motivational factors of
Herzberg. This type of leadership can only be effective if there is a rapid process of
reorganization. However, this leads the organization to a strict hierarchical orga-
nizational structure (Pawar 2014, p. 12). According to the leadership literature, the
autocratic leaders have a strong and instructive structures (Rast et al. 2013, p. 636).
Democratic Leadership
A democratic leader includes his inferiors in the decision-making processes. It
displays a Y-style leadership structure (Pawar 2014, p. 14). McGregor suggests that
in Y-type leadership, the employees will not hesitate to take responsibilities, and
they will have the capacity for self-regulation. Democratic leader analytically
interprets both his own and the others’ behaviors (Rosenfeld and Plax 2003,
p. 208).
Delegative Leadership
This type of leadership was first defined by Lewin, Lippitt, and White in 1939
together with autocratic and democratic leadership styles (Pawar 2014, p. 12).
Delegative leadership style is described as the most passive type of leadership. It is
also defined as the absence/lack of leadership. The most distinct characteristic of
this type of leaders is that they abstain from making decisions. The powers and
authorities of the inferiors are maximized through a significant freedom of action
for the inferiors (Deluga 1990, p. 192).
7 The Effects of Leadership Styles on Organizational … 105
Ethical Leadership
The concept of virtue as derived from Aristotle has reached to the concept of ethics
in leadership. Virtue is defined as a personality trait, and this trait owned by the
leaders is regarded as “moral perfection.” The characteristics are modesty, courage,
honesty, compassion, humor, passion, wisdom, fairness, benevolence,
self-devotion, determination, toleration, enthusiasm, responsibility, love, and trust.
In short, it can be said that these traits cover the characteristics of an ethical leader
(Lawton and Páez 2015, p. 641). The key factor for ethical leadership is that the
leader shows consistency in his own behaviors and attitudes (Lawton and Páez
2015, p. 641–642).
determined, he also stated that this concept is “based on an illusion.” He stated that
trust is an imaginary function that provides an environment for communication in
societies and organizations (Jalava 2003, p. 185). Luhmann sees trust as a means to
fight against uncertainty (Bachmann 2001, p. 341–342). The dimensions of trust are
analyzed in three aspects such as the trust in co-workers, trust in manager, and trust
in organization (Yılmaz 2015, p. 56; Kanten 2012, p. 131). While trust in
co-workers is the first element of organizational trust, it is also known as the
“horizontal trust” (Çalışkur 2015, p. 163). It is stated that the factor that strengthens
collectivist practice in organizations is the interpersonal trust (Song et al. 2009,
p. 148; 151). Trust in managers is also known as the “vertical trust.” It represents
the trust in relationships between the employees and the managers/leaders (Çalışkur
2015, p. 163). Trust in organization is also known as the “external trust,” and it
represents the trust in relationships between the organization and its employees,
clients, and the suppliers, and the overall trust put in the operation and system of the
organization by these individuals (Çalışkur 2015, p. 163).
7.1.2.1 Whistleblowing
Fig. 7.1 Archetypal traits exhibited by a whistleblower. Reference Banerjee and Roy (2014,
p. 10)
The first part of the research was conducted on 292 employees in the company
operating in the field of metal packaging in the Marmara Region. The second part of
the research is the education sector. Three hundred and fourteen teachers working in
108 F. Çağla Oran and A. S. Ünsar
primary and secondary schools reached Istanbul. The third part of the research is the
textile sector. Three hundred and sixty-seven employees reached the textile sector
in Istanbul.
Survey Form and Scales
This study has been used theories of leadership in this research since they are
adapted and tested for their reliability and validity in Turkey: Tuna, Bircan, and
Yeşiltaş’s scale of ten items (2012) on ethical leadership is derived from Brown
et al. (and Trevino 2014). Begeç’s (1999) and Ateş’s scale of 30 items on other
leadership styles (2005) is derived from Clark and Clark (1997, 2004). This study
has employed Adams’ (2004) scales of organizational trust which has been inspired
from Luhmann’s framework, and it is adapted by Kanten (2012). This study has
employed Parks etc.’ scales of whistleblowing, and it is adapted by Nayır (2012).
Eleven questions were added the scale by the researcher (Oran 2018).
Research Model
The model for the purpose of the research is shown in Fig. 7.3.
Investigation of Demographic Characteristics of Participants
The demographic characteristics that are considered are: age, gender, education,
seniority/tenure track, marital status, hometown (during upbringing of teachers
during primary and secondary schooling years between 7 and 19 of age, Table 7.1).
Explanatory Factor Analysis For Scales
Ten questions that are found to be below 0.50 (i.e., questions 5, 15, 16, 21, 22, 27,
28, 29, 32, 33) are omitted from the analysis (Tables 7.2 and 7.3).
7 The Effects of Leadership Styles on Organizational … 109
Fig. 7.4 SEM model (v2/df = 3.324; NFI = 0.846; NNFI = 0.814; IFI = 0.887; CFI = 0.887;
RMSA = 0.049; GFI = 0.801; AGFI = 0.785; PNFI = 0.805; and PGFI = 0.741) (AW explicit
whistleblowing, DKL democratic leadership, DW external whistleblowing, EL ethical leadership,
FW formal whistleblowing, IFW informal whistleblowing, IW internal whistleblowing, OL
autocratic leadership, OG organizational trust, SL delegative leadership, YG managerial trust, ZW
implicit whistleblowing)
When the research findings are analyzed, it is observed that the perception of trust
in executives and organization, and the ethical, democratic, and delegative lead-
ership perceptions were higher in white-collar employees when compared to the
blue-collar employees. It is because they behave as required by the responsibilities
undertaken, the increasing number of inferiors, and the obligation to display
7 The Effects of Leadership Styles on Organizational … 115
EL DKL OL SL OG YG ZW AW FW DW IW IFW
EL Correlation 1.000 0.693** 0.274** 0.501** 0.602** 0.638** −0.116** 0.218** 0.386** 0.026 0.407** −0.061
coefficient
Sig. 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.423 0.000 0.058
(two-tailed)
N 973 973 973 973 973 973 973 973 973 973 973 973
DKL Correlation 0.693** 1.000 0.354** 0.543** 0.583** 0.616** −0.125** 0.194** 0.388** 0.018 0.365** −0.053
coefficient
Sig. 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.565 0.000 0.099
(two-tailed)
N 973 973 973 973 973 973 973 973 973 973 973 973
OL Correlation 0.274** 0.354** 1.000 0.277** 0.210** 0.194** 0.036 0.113** 0.268** −0.010 0.220** 0.124**
coefficient
Sig. 0.000 0.000 0.000 0.000 0.000 0.260 0.000 0.000 0.763 0.000 0.000
(two-tailed)
N 973 973 973 973 973 973 973 973 973 973 973 973
SL Correlation 0.501** 0.543** 0.277** 1.000 0.458** 0.421** 0.032 0.263** 0.291** 0.181** 0.272** 0.076*
coefficient
Sig. 0.000 0.000 0.000 0.000 0.000 0.318 0.000 0.000 0.000 0.000 0.018
(two-tailed)
N 973 973 973 973 973 973 973 973 973 973 973 973
ÖG Correlation 0.602** 0.583** 0.210** 0.458** 1.000 0.731** −0.083** 0.227** 0.305** 0.115** 0.359** −0.026
coefficient
Sig. 0.000 0.000 0.000 0.000 0.000 0.010 0.000 0.000 0.000 0.000 0.425
(two-tailed)
N 973 973 973 973 973 973 973 973 973 973 973 973
(continued)
F. Çağla Oran and A. S. Ünsar
Table 7.6 (continued)
EL DKL OL SL OG YG ZW AW FW DW IW IFW
YG Correlation 0.638** 0.616** 0.194** 0.421** 0.731** 1.000 −0.195** 0.159** 0.314** 0.031 0.353** −0.083**
coefficient
Sig. 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.326 0.000 0.009
(two-tailed)
N 973 973 973 973 973 973 973 973 973 973 973 973
ZW Correlation −0.116** −0.125** 0.036 0.032 −0.083** −0.195** 1.000 0.054 0.076* 0.399** −0.143** 0.553**
coefficient
Sig. 0.000 0.000 0.260 0.318 0.010 0.000 0.095 0.018 0.000 0.000 0.000
(two-tailed)
N 973 973 973 973 973 973 973 973 973 973 973 973
AW Correlation 0.218** 0.194** 0.113** 0.263** 0.227** 0.159** 0.054 1.000 0.448** 0.461** 0.420** 0.145**
coefficient
Sig. 0.000 0.000 0.000 0.000 0.000 0.000 0.095 0.000 0.000 0.000 0.000
(two-tailed)
N 973 973 973 973 973 973 973 973 973 973 973 973
7 The Effects of Leadership Styles on Organizational …
FW Correlation 0.386** 0.388** 0.268** 0.291** 0.305** 0.314** 0.076* 0.448** 1.000 0.193** 0.432** 0.166**
coefficient
Sig. 0.000 0.000 0.000 0.000 0.000 0.000 0.018 0.000 0.000 0.000 0.000
(two-tailed)
N 973 973 973 973 973 973 973 973 973 973 973 973
DW Correlation 0.026 0.018 −0.010 0.181** 0.115** 0.031 0.399** 0.461** 0.193** 1.000 0.219** 0.366**
coefficient
Sig. 0.423 0.565 0.763 0.000 0.000 0.326 0.000 0.000 0.000 0.000 0.000
(two-tailed)
N 973 973 973 973 973 973 973 973 973 973 973 973
(continued)
117
Table 7.6 (continued)
118
EL DKL OL SL OG YG ZW AW FW DW IW IFW
İW Correlation 0.407** 0.365** 0.220** 0.272** 0.359** 0.353** −0.143** 0.420** 0.432** 0.219** 1.000 −0.128**
coefficient
Sig. 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000
(two-tailed)
N 973 973 973 973 973 973 973 973 973 973 973 973
İFW Correlation −0.061 −0.053 0.124** 0.076* −0.026 −0.083** 0.553** 0.145** 0.166** 0.366** −0.128** 1.000
coefficient
Sig. 0.058 0.099 0.000 0.018 0.425 0.009 0.000 0.000 0.000 0.000 0.000
(two-tailed)
N 973 973 973 973 973 973 973 973 973 973 973 973
*p < 0.05, **p < 0.01
AW explicit whistleblowing, DKL democratic leadership, DW external whistleblowing, EL ethical leadership, FW formal whistleblowing, IFW informal
whistleblowing, IW internal whistleblowing, OL autocratic leadership, OG organizational trust, SL delegative leadership, YG managerial trust, ZW implicit
whistleblowing
F. Çağla Oran and A. S. Ünsar
7 The Effects of Leadership Styles on Organizational … 119
expertise. This forces the superiors to adopt a democratic leadership style. In this
study, the majority of the employees with bachelor’s degrees are teachers. It can be
concluded that a self-management insight arises since the teachers track their own
tasks and duties. This puts forward delegative leadership style.
7 The Effects of Leadership Styles on Organizational … 121
Table 7.8 Structural model results and bootstrap confidence interval values
SEM Std. regression Regression (S. t (C. p Bootstrap 95%
coefficient coefficient E.) R.) Upper Lower
H12 ZW ← OL 0.294 0.391 0.069 5.712 *** 0.133 0.52
H13 FW ← OL 0.234 0.222 0.044 5.045 *** 0.132 0.335
H14 İFW ← OL 0.386 0.38 0.055 6.85 *** 0.219 0.634
H4 YG ← DKL 0.515 0.56 0.049 11.414 *** 0.378 0.655
H16 DW ← DKL −2.191 −2.827 0.392 −7.207 *** −3.17 −1.515
H17 AW ← DKL −1.368 −1.647 0.272 −6.065 *** −2.042 −0.843
H18 ZW ← DKL −2.538 −2.916 0.37 −7.885 *** −4.191 −1.28
H19 FW ← DKL −0.534 −0.435 0.117 −3.709 *** −1.017 −0.179
H20 İFW ← DKL −2.774 −2.349 0.309 −7.594 *** −4.57 −1.436
H5 ÖG ← SL 0.702 0.899 0.054 16.64 *** 0.649 0.754
H21 İW ← SL 0.515 0.694 0.051 13.539 *** 0.441 0.583
H22 DW ← SL 3.057 4.803 0.583 8.24 *** 2.314 3.929
H23 AW ← SL 2.092 3.068 0.407 7.54 *** 1.406 2.687
H24 ZW ← SL 3.06 4.282 0.534 8.013 *** 1.615 4.954
H25 FW ← SL 0.916 0.91 0.143 6.351 *** 0.602 1.365
H26 İFW ← SL 3.334 3.437 0.447 7.687 *** 1.794 5.407
H8 YG ← EL 0.299 0.344 0.048 7.098 *** 0.15 0.443
H28 DW ← EL −0.909 −1.242 0.2 −6.194 *** −1.442 −0.491
H29 AW ← EL −0.584 −0.744 0.143 −5.197 *** −0.936 −0.273
H30 ZW ← EL −0.9 −1.094 0.182 −6.024 *** −1.989 −0.438
H32 İFW ← EL −0.985 −0.882 0.148 −5.967 *** −2.14 −0.509
*p < 0.05, **p < 0.01, ***bootstrap 2000 samples
AW explicit whistleblowing, DKL democratic leadership, DW external whistleblowing, EL ethical leadership, FW
formal whistleblowing, IFW informal whistleblowing, IW internal whistleblowing, OL autocratic leadership, OG
organizational trust, SL delegative leadership, YG managerial trust, ZW implicit whistleblowing
While the employees with higher levels of education tend to internal and formal
whistleblowing, confidential and informal whistleblowing becomes prominent
among the employees with lower levels of education. As the level of education
increases, the chance for the employees to take part in administrative levels will
also increase. Thus, when they encounter a potential ethical violation, it may be said
that they will probably try working on the intra-organizational decision mechanism
regarding their inferiors under their administration, since there will be higher
chance that the violence might be committed by one of their personnel. It is also
observed that the inferiors will take external actions if they see that the ethical
violations that they saw or experienced are coming straight from the top manage-
ment. It may result from lack of information in lower-level employees regarding
in-house channels of disclosure.
While ethical, democratic, and delegative leadership styles become prominent in
education sector when compared to textile industry, autocratic leadership style
becomes prominent in packaging industry. It may be suggested that the fact that the
122 F. Çağla Oran and A. S. Ünsar
Table 7.10 Mann–Whitney U test result for sub-dimensions of leadership styles scale
Dependent Independent variable Z Sig. Explanation
variable
Democratic Gender −2.417 0.016 There is a significant difference
leadership Mean rank between gender and democratic
leadership style. Female
Female Male
employees are perceiving their
509.65 466.10 leaders’ styles as more democratic
than male employees
Delegative Marital status −2.144 0.032 There is a significant difference
leadership Mean rank between marital status and
delegative leadership style.
Married Single
Married employees are perceiving
504.12 465.38 their leaders’ styles as more
delegative than single employees
Ethical Position −8.419 0.000 There is a significant difference
leadership Mean rank between position and ethical
leadership style. White-collar
Manual White-collar
workers are perceiving their
workers workers
leaders’ styles as more ethical
425.73 580.57 than manual workers
Democratic Position −10.613 0.000 There is a significant difference
leadership Mean rank between position and democratic
leadership style. White-collar
Manual White-collar
workers are perceiving their
workers workers
leaders’ styles as more democratic
409.69 605.08 than manual workers
Delegative Position −2.970 0.003 There is a significant difference
leadership Mean rank between position and delegative
leadership style. White-collar
Manual White-collar
workers are perceiving their
workers workers
leaders’ styles as more delegative
than manual workers
7 The Effects of Leadership Styles on Organizational … 123
Table 7.11 Mann–Whitney U test results of intergroup differences among leadership style scale
Dependent Independent variable Z Sig. Explanation
variable
Ethical Education There is a significant difference
leadership Mean rank between education and ethical
leadership style. Primary
Primary Bachelor −6.698 0.000
school, middle school, and
school
high school education level of
193.77 286.87 employees are perceiving their
Middle High school −2.968 0.003 leaders’ styles as less ethical
school than the others
184.74 219.11
Middle Bachelor −8.388 0.000
school
202.57 319.85
High Bachelor −5.396 0.000
school
223.06 298.23
Middle Graduate −2.250 0.024
school study
110.45 144.88
Vocational Bachelor −3.194 0.001
school
138.99 198.55
Democratic Education There is a significant difference
leadership Mean rank between education and
democratic leadership style.
Primary High school −2.782 0.005
Primary school, middle school,
school
and high school education
165.41 196.14 level of employees are
Primary Bachelor −8.274 0.000 perceiving their leaders’ styles
school as less democratic than the
178.87 294.08 others
Primary Graduate −2.843 0.004
school study
90.11 126.50
Middle High school −3.323 0.001
school
182.73 221.23
Middle Bachelor −9.943 0.000
school
188.84 328.04
Middle Graduate −3.260 0.001
school study
109.08 158.98
(continued)
124 F. Çağla Oran and A. S. Ünsar
Table 7.12 Mann–Whitney U test result for sub-dimensions of organizational trust scale
Dependent Independent variable Z Sig. Explanation
variable
Managerial Position −9.392 0.000 There is a significant
trust Mean rank difference between
position and
Manual White-collar
managerial trust.
workers workers
White-collar workers
418.78 591.19 have higher managerial
trust than the others
Organizational Position −6.865 0.000 There is a significant
trust Mean rank difference between
position and
Manual White-collar
organizational trust.
workers workers
White-collar workers
437.02 563.33 have higher
organizational trust
than the others
behaviors against working hours, differences between actual and registered wages,
and higher levels of unregistered employment, proves this result. It is observed that
democratic leadership style prevails in education sector, where the employees have
higher levels of education. It may be concluded that the chance of being taken into
consideration in terms of leader–member relations increases as the levels of edu-
cation increase. With the existence of dangerous conditions in metal packaging
industry, it may also be concluded that the perceived risk of occupational safety is
higher. Lower levels of education among workers, the importance of even a small
mistake and negligence, and no tolerance to mistakes force the superiors to
implement strict and supervisory rules. When the sectoral report on work accidents
is examined, it is observed that the number of work accidents in metal product
manufacturing is ranked first except for machinery and equipment (TMMOB
(Union of Chambers of Turkish Engineers and Architects) Chamber of Mechanical
Engineers 2018, s. 54–59).
The levels of trust to management and organization are higher in education
sector than it is in packaging and textile industries. This may be explained by the
fact that education is a public sector, and that they take part in management by
complying with predesignated decisions instead of their own independent deci-
sions. All teachers in education sector are equal, and this leads to an increase in trust
in co-workers, since there are no conflicts of interest, or any other area of com-
petition such as promotion that are common in private sector. In addition, the fact
that the schools are under the control of the government, and the work conditions
are standardized and protected by the laws in accordance with the predesignated
procedures may influence the trust in management and, thus, the trust in their
organizations.
Internal whistleblowing has become more prominent in education sector than in
textile industry. This may be explained through institutionalized structure of the
7 The Effects of Leadership Styles on Organizational … 127
Table 7.13 Mann–Whitney U test results of intergroup differences among organizational trust
scale
Dependent Independent variable Z Sig. Explanation
variable
Managerial Education There is a significant
trust Mean rank difference between
education and
Primary Graduate −2.534 0.011
managerial trust.
school study
Primary school, middle
90.54 122.93 school, high school,
Middle High −2.063 0.039 and vocational school
school school education level of
189.86 213.73 employees have lower
Middle Bachelor −8.065 0.000 managerial trust than
school the others
205.69 317.98
Middle Graduate −2.463 0.014
school study
110.17 147.80
High Bachelor −6.571 0.000
school
212.79 304.07
High Graduate −2.183 0.029
school study
105.54 137.50
Vocational Bachelor −2.908 0.004
school
144.06 197.98
Organizational Eğitim Düzeyi There is a significant
trust Mean rank difference between
education and
Primary Bachelor −4.353 0.000
organizational trust.
school
Primary school, middle
215.72 276.24 school, high school,
Middle Bachelor −6.351 0.000 and vocational school
school education level of
220.37 309.22 employees have lower
Middle Graduate −1.988 0.047 organizational trust
school study than the others
110.81 141.23
High Bachelor −5.823 0.000
school
219.19 300.44
Vocational Bachelor −3.465 0.001
school
134.32 199.08
(continued)
128 F. Çağla Oran and A. S. Ünsar
education sector and the existence of internal disclosure channels. The textile
workers usually believe that it will be hard for them to find another job because of
their levels of education, they do not want to risk their jobs, they avoid catching the
attention of their co-workers and management, and thus, they may prefer to disclose
ethical violations confidentially. There are no internal disclosure channels in the
companies, textile industry, that are included in this study, and this may have led to
external whistleblowing. It is also observed that the people from smaller towns tend
to choose external whistleblowing method when compared to people from larger
cities. In this case, it can be concluded that there is a migration flow from smaller
towns to cities, and these immigrants are mostly employed in textile industry.
7 The Effects of Leadership Styles on Organizational … 129
Table 7.15 Mann–Whitney U test results of intergroup differences among whistleblowing scale
Dependent Independent variable Z Sig. Explanation
variable
External Age The employees whose 20–29 age and 40–49
whistleblowing Mean rank age tend to be less external whistleblowing
than 30–39 age employees
20–29 age 30–39 age −1.959 0.050
405.09 373.46
20–29 age 40–49 age −2.744 0.006
295.54 251.43
External Seniority More senior employees tend to be less external
whistleblowing Mean rank whistleblowing than less senior employees
Less than 1–5 years −2.026 0.043
1 year
360.39 399.64
Less than 11–15 years −2.220 0.026
1 year
115.48 92.67
1–5 years 11–15 years −3.491 0.000
336.22 237.45
1–5 years 21 years and −2.348 0.019
over
313.36 191.21
Internal Education There is a significant difference between
whistleblowing Mean rank education and internal whistleblowing. Middle
school education level of employees tends to
Middle High school −1.992 0.046
be less internal whistleblowing than high
school
school and bachelor education level of
190.36 213.20 employees
Middle High school −4.556 0.000
school
236.82 299.39
High Bachelor −2.386 0.017
school
250.20 282.82
External Education There is a significant difference between
whistleblowing Mean rank education and external whistleblowing.
Primary school and middle school education
Primary Vocational −2.629 0.009
level of employees tend to be more external
school school
whistleblowing than vocational school,
108.75 81.04 bachelor, and graduate study education level of
Primary Bachelor −3.002 0.003 employees
school
284.54 242.92
Primary Graduate −2.031 0.042
school study
96.77 70.90
Middle Vocational −2.742 0.006
school school
128.37 94.63
(continued)
7 The Effects of Leadership Styles on Organizational … 131
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136 F. Çağla Oran and A. S. Ünsar
Bilimleri Ana Bilim Dalı Eğitim Yönetimi, Teftiş, Planlaması Ve Ekonomisi Yüksek Lisans
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39–45.
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229–239.
Feyza Çağla Oran graduated from Trakya University, Faculty of Economics and Administrative
Sciences, Department of Business Administration in 2009. She completed her graduate education
in Trakya University, Social Sciences Institute, Department of Business Administration, in 2012.
She worked in private sector as a specialist for two years. She completed her doctoral studies in
2018; her dissertation topic was about leadership, organizational trust, and whistleblowing. Since
2015, she is continuing her career as Lecturer in the logistics program at Kadir Has Vocational
School. Her research interests focus on management and organizational behavior, leadership, and
ethics.
Professor Dr. Agah Sinan Ünsar was born in Kırklareli, Turkey, in 1967. He received primary
and secondary education in Edirne. He graduated from Edirne High School in 1984. He graduated
from the Department of Business Management at Open Education Faculty at Eskişehir Anadolu
University with a good degree in 1990. He completed his military service as reserve office in 1992.
He received master’s degree from the Department of Business Administration at Institute of Social
Sciences of Trakya University and doctorate degree from the Department of Human Resources
Management at Institute of Social Sciences of Istanbul University. He worked in Trakya
University as Contracted Civil Servant between the years of 1992 and 1994. Between 1994 and
1998, he worked as Civil Servant in Institute of Social Sciences at Trakya University. He worked
as Faculty Member in the Department of Business Administration at Faculty of Economics and
Administrative Sciences at Trakya University between 1998 and 2004 and as Assistant Professor
between 2004 and 2010. He received associate professor degree in the field of “management and
organization” in 2010. He was appointed as Professor in 2015. He continues to work as Professor
in the same faculty and gives graduate, postgraduate, and doctorate lessons at the Department of
Management and Organization. Furthermore, he serves as thesis advisor at postgraduate and
doctorate level. His fields of specialization are human resources management and organizational
behavior.
Part III
New Approaches in CSR
Chapter 8
Corporate Social Responsibility
in Bulgaria: Perspectives
and Possibilities
provided in the second part. Third part presents some aspects and directions of CSR
implementation by companies in Bulgaria, methods, forms, etc., that are typical for
the Bulgarian business in recent years. They are classified according to the degree
of utilization and the degree of efficiency from the business, not social, point of
understanding. The fourth part covers the effects of CSR on the development of
regions in Bulgaria (by presenting examples from selected regions). The focus of
the survey is on the status quo and the trends of CSR implementation that is carried
out by business organizations operating on the Bulgarian market. Their impact on
the regional development, based on selected socio-economic and demographic
indicators is also presented. For this purposes, the following research methods are
used: data collection and processing of statistical information, data comparison
method, diagnostic analysis, etc. Finally, the main conclusions are presented and
the next steps of the authors’ research in the area of CSR in Bulgaria are outlined.
8.1 Introduction
The concept for corporate social responsibility, namely the companies’ responsi-
bility for the economic, social and ecological outcomes of their activities, is a
relatively new concept in Bulgaria. The use of this notion has mainly been related to
the processes of integration and acceptance of our country for a full-right member
of EU and the established traditions and experience in this field of the international
companies that have entered our market.
In 2011, the European Commission published a new strategy on CSR, which
aims to create conditions favourable to sustainable growth and employment gen-
eration in the medium and long term. Through CSR, enterprises can significantly
contribute to the European Union’s treaty objectives of sustainable development
and a highly competitive social market economy. CSR underpins the objectives of
the Europe 2020 strategy for smart, sustainable and inclusive growth, including the
75% employment target. The European Commission has previously defined CSR as
“a concept whereby companies integrate social and environmental concerns in
their business operations and in their interaction with their stakeholders on a
voluntary basis”.1 The European Commission now puts forward a new and simpler
definition of CSR as “the responsibility of enterprises for their impacts on society”.
The EU’s strategy clearly demonstrates that the positive development of the
European economy is closely related to Europe’s companies putting sustainability
and corporate responsibility into practice on the ground and that these issues have to
be driven by these very companies. To facilitate this, the EU is creating a shared
political framework and promoting the discussion on CSR.
In response to the dynamic socio-economic eco system, the Commission is
making a number of regulatory proposals to ensure a more responsible and trans-
parent financial system. The Commission intends to consider a requirement on all
investment funds and financial institutions to inform all their clients (citizens,
enterprises, public authorities, etc.) about any ethical or responsible investment
criteria they apply or any standards and codes to which they adhere. The new policy
also puts forward an agenda for action covering eight areas:
• Enhancing the visibility of CSR and disseminating good practices;
• Improving and tracking levels of trust in business;
• Improving self- and co-regulation processes;
• Enhancing market reward for CSR;
• Improving company disclosure of social and environmental information;
• Further integrating CSR into education, training and research;
• Emphasizing the importance of national and sub-national CSR policies;
• Better aligning European and global approaches to CSR.
Despite the slow acceptance of the principles and policies of CSR in comparison
with the world trends, the Bulgarian business has increased significantly its
1
EU Strategy on Corporate Social Responsibility (2011).
144 D. Kopeva et al.
awareness of these models, because apart from the practices that the companies
themselves can benefit from, these business models serve as a condition for survival
and competitiveness in today’s global economy reality. Various initiatives held by
international and national organizations help the popularization of CSR amongst the
Bulgarian companies. The ones that are worth being mentioned are:
• The inauguration of the Bulgarian Business Leaders Forum (BBLF) in
November 1998 and the launch of the project Code of Business Ethics October
1999 when several BBLF member companies presented their codes of business
ethics and shared examples of good business practices.
• The creation of a national network of companies, members of the initiative
Global Compact, in 2003 that aimed to make social responsible practices in
Bulgaria more popular.
• In 2007, a Bulgarian Code for Corporate Governance was adopted and later on
the Association of Bulgarian Industrial Capital together with the Association of
Bulgarian Investor Relation Directors presented a Handbook of Good Practices
for Corporate Social Responsibility, which is applied in the activities of 130
Bulgarian companies at the moment.
• In 2010, indicators for measurement of the effectiveness of CSR on national and
company level have been developed in the frames of the regional project
“Increasing of the transparency and reliability of the CSR practices through
establishment of a system for evaluation and monitoring of CSR in the new EU
member-states”.
The state also has an active role and encourages the implementation of CSR in
the country by creating an appropriate legislative environment and conditions for
effective partnerships between all interested parties. Bulgaria had ratified different
UN conventions, related to respect of human rights, ecology and fight against
corruption, as well as the ones related to International Labour Organization(ILO), in
respect of the labour standards. In addition to that on 25 November 2009 was
adopted a National Strategy for Corporate Social Responsibility, that reflects the
state attitude towards CSR matters and has as an objective the creation and rein-
forcement of a favourable environment for the implementation of CSR practices.
The strategy covers the 2009–2013 period and is divided in three steps: analysis of
the situation; vision, goals and principles; and implementation of the CSR strategy.
As a result of all these activities and efforts CSR’s popularity amongst the Bulgarian
business is increasing and more and more companies declare their social and
ecological engagement. Nevertheless, the fact is that in the greater number of cases
the companies are doing charity, donations or restricted in their scope activities in
this direction, and don’t act on the implementation of comprehensive internationally
acknowledged corporate models and standards, aiming to be a part of a long-term
strategy for sustainable growth.
In 2011, a great advance in relation to the implementation of transparent and
responsible management in Bulgaria was made and two companies presented their
first reports on sustainable development and CSR (for 2010), based on G3 created
8 Corporate Social Responsibility in Bulgaria: Perspectives … 145
The intensive process of globalization, the growing social and public requirements,
as well as the unprecedented climate changes set new type of challenges for the
companies that can be overcome only through responsible and transparent man-
agement and by having in mind the economic, social and ecological impact of their
work. The broad range of areas in which CSR is categorized include:
• Involvement in the community;
• Internal corporate culture;
• Education and leadership development;
• Corporate governance and business ethics;
• Environmentally friendly business.
Above all, corporate social responsibility is a philosophy that the companies in
Bulgaria believe every true business leader has to share. Today’s managers under-
stand that the sustainable social responsible practices are the main element in
achieving a successful corporate management and effective leadership. A prerequisite
for meeting this responsibility is the observance of the legislation and the group
contracts between the social partners. In order to be able to fulfil their CSR, the
companies have to implement processes for integration of the social, ecological and
ethical issues, as well as issues related to human rights and consumers, in their
business activities and overall strategy. Moreover, the companies have to work in
close cooperation with the interested parties aiming to (i) increase the creation of a
shared value for their owners/shareholders and for other stakeholders and the society
as a whole and (ii) to determine, avoid and tone down the possible negative effects.
CSR is a concept, whereby companies integrate social responsibilities and en-
vironmental concerns in their business operations and in relations with partners on a
voluntary basis. The most common social accountability covers the obligations of
business to society, expansion of their circle, for economic functions and the
inclusion of social activities such as necessities.
The social responsibility of business is multi-layered. The first observance of the
principles of corporate social responsibility involves compliance with the following
obligations: timely payment of taxes, wages and creation of new jobs. The second
level of CSR involves the provision of adequate conditions for work and life of
146 D. Kopeva et al.
employees by increasing their skills, preventive treatment, housing and social de-
velopment. The highest, third, level of responsibility, charity events, including local
infrastructure improvements. In particular, corporate social excuse can be crammed
into the field:
A. Society
• Upgrading of the urban environment;
• PR activities and social impact;
• Volunteer;
• Support and social integration of children-orphans, and children and adults
in homes;
• Preservation of cultural and historical heritage;
• The quality and safety of products;
• Donations;
• Sponsorship.
B. Ecology
• Pollution control;
• Restoration or protection of the environment;
• Conservation of natural resources;
• Processing;
• Spending on energy efficiency and reduction of environmental pollution;
• Manage the impact of the environment and natural resources.
C. Human capital and working conditions
• The development of a healthy and safe working conditions;
• Training and staff development;
• Support career development;
• Volunteer programs for employees;
• Programs for objective and fair remuneration;
• The satisfaction and commitment of employees.
D. Knowledge and education
• Scholarships to support people at a disadvantage;
• Providing tools and materials for practicing at school;
• Providing a paid internship;
• Encouraging young intelligent people.
E. Marketing associated with business
• Product donations.
Social responsibility brings many advantages for the organizations using it. They
could be seen in respecting the interests of all stakeholders; counting business
influence over economy, society, environment; increasing reputation of the business
organization; contributing for economic stability in the region, where organization
8 Corporate Social Responsibility in Bulgaria: Perspectives … 147
operates in; accent over stable use of natural resources. The integration of corporate
social responsibility, as a key tool in the strategies for company development, and
the active dialouge with all interested persons can cooperate for long-term stable
progress and increasing the value of relevant companionship, and it can realize
competitive advantages2 in improving producing effectiveness; realization of pro-
duct decentralization and innovations; better satisfaction of the company client’s
needs; better management of the company risks; improving the personnel compe-
tence and increasing the value of intellectual capital by development of human
resources; improving the trade reputation and company image; achievement of
higher share price of the social responsible companies. Independently of the taken
actions and created preconditions, corporate social responsibility of the Bulgarian
companies is accompanied with settling problems like:
• Passive attitude of the organization’s managers towards market’s attitudes;
• Lack of information for regulation of social responsibility, not knowing the
procedures and values of the certification favours;
• Lack of resources for execution of certain activities by the social policy;
• Organizational problems of the business organizations, as not regulated prop-
erty, draining of funds, etc.;
• Problems with sharing information for social responsible activities of
organization.
The main challenges at application of corporate social responsibility are con-
nected with lack of the so-called administrative capacity; lack of leading state
structure, which guides and coordinates actions of the single government institu-
tions and collaborates with business, civil society, media and academic community;
insufficient dissemination and not knowing the conception for corporate social
responsibility; distrust of the community, syndicates, users and others; certain
prejudices in business; myths and realities for the benefits from social responsible
practices; pseudo-social responsible practices.
The CSR’s impact over the regional development could be found in the given above
five directions. They could be specified in the following indicators in order to be
found by the national social and business accounts:
• Gross domestic product (GDP) per capita/Purchasing power standard (PPS) per
capita: the market impact of the CSR’s activities means that the total income of
2
Gogova (2011).
148 D. Kopeva et al.
the local inhabitants will increase the total value of the business in the region
and, respectively, it will increase the monetary wealth of the local society.
• Employment/Unemployment rate: the CSR’ activities basically involve more
local people not just at temporary employment but decreases the long-term
unemployment as well. It is because the CRS activities are provided by the local
companies and, respectively inhabitants.
• In-patient average length of stay/Hospital days of in-patients/Number of people
at risk of social exclusions: basically CSR activities help the society to develop
and the health and social exclusion decrease.
• Participation rates in education/Education exclusion: whether the new
employment opportunities arose by CSR’s activities the desire for education
increases, as well as the rate of excluded pupils from the educational system
decreases.
• Rate of natural change of population/Rate of net migration: the wealthy regions
are magnets for the people. Thus, the regions that increase total value of life
being increase their population exponentially.
The given five indices are used in analysis of the impact of the CSR on the
regional development in Bulgaria. The time coverage is 2000–2016 as the different
indices are observed by different time sets according to the national accounts.
The data is collected and provided as open source database by the Eurostat and
Bulgarian national statistical office. The regional data coverage includes statistical
data for NUTS 2 regions in Bulgaria, respectively: north-west (NW); north central
(NC), north-east (NE), south-east (SE), south central (SC), and south-west (SW).
A data set for Pazardzhik at NUTS 3 level as a part of south central region is
included as well.
A. Development impact: the total development is basically observed by the
change of GDP. We use a structural indices that reduce the regional inequality
as: Gross domestic product (GDP) per capita (Fig. 8.1)/Purchasing power
standard (PPS) per capita (Fig. 8.2).
Figures 8.1 and 8.2 show that some Bulgarian regions are developing faster than
others. For example:
• The south-west region is economically over developed in comparison with the
others regions. The GDP per capita in 2011 is more than twice than the fol-
lowing SE region. The difference in the indices “Purchasing power standard
(PPS) per capita” is much higher.
• In addition, the north-west and south central regions are developing slowly than
the others. The figures for these regions flew down in comparison with others.
• On the other side, the Pazardzhik region is economically presented well than the
south central region. From the last place in figures for 2005, the researched
indices sharply increase 2006–2008 and 2010–2011.
8 Corporate Social Responsibility in Bulgaria: Perspectives … 149
Fig. 8.1 Gross domestic product (GDP) per capita by regions at NUTS 2 in Bulgaria
Fig. 8.2 Purchasing power standard (PPS) per capita by regions at NUTS 2 in Bulgaria
B. Labour impact: the job creation by the CSR’s activities reflected on the in-
crease of employment rate (Fig. 8.3) as well as on decrease of unemployment
rate (Fig. 8.4).
The figures verify some of the above results. For example:
• The south-west region is labour over developed in comparison with the others
regions. The youth employment rate is 10% higher as the unemployment rate is
2.5% lower in 2011 than the following NE/SE regions. The difference in the
indices “Purchasing power standard (PPS) per capita” is much higher.
• In addition, the north-west and north central regions are characterized by lowest
levels of youth employment and highest level of unemployment.
150 D. Kopeva et al.
Fig. 8.3 Purchasing power standard (PPS) per capita by regions at NUTS 2 in Bulgaria
• The case of south central region is interesting as it takes a middle position in the
both indices, but they have highest change rate during the observed period. The
employment/unemployment rates sharply increase/decrease 2005–2008 and
2012–2015, and vice versa: sharply decrease/increase 2009–2011.
C. Social wealthy impact: it is measured by the share of people at risk of poverty
and social exclusion (Fig. 8.5). Preliminary expectations are that the CSR’s
activities reduce the social exclusion.
The figures verify some of the above results. For example:
• The south-west region is social wealthy over developed in comparison with the
others regions. The social exclusion rate is 50% higher than the following SE
regions.
8 Corporate Social Responsibility in Bulgaria: Perspectives … 151
• The case of south central region is interesting as it had started at second place in
2008 with 43% rate of social exclusion and finished at last place in 2016 with
46% exclusion rate. All other regions have changed positively their exclusion
rates even the most economic undeveloped NW region.
D. Demographic impact: it is measured by the natural change of population and
net migration. We use structural indices that reduce the regional inequality as:
Rate of natural change of population (Fig. 8.6)/Rate of net migration (Fig. 8.7).
Preliminary expectations are that the CSR’s activities increase the positive
natural change of the population by increasing birth rate and decreasing death
rate, as well as increase the positive net migration by reducing outgoing em-
ployees and attracting incoming employees by other regions/countries.
Fig. 8.6 Rate of natural change of population by regions at NUTS 2 in Bulgaria (‰)
152 D. Kopeva et al.
Figures 8.6 and 8.7 verify some of the above results. For example:
• The south-west region is the single region with positive figures on net migration
with the lowest level of decrease of natural change of population. The
north-west and north central regions are firmly last according to the both indices.
• The cases of south central and north-east regions are totally opposite as the
highest decrease of net change rate of SW in 2001 is quite opposite the positive
net change of population of NE. The next ten years the negative figures for SC
decreases opposite of the decreasing negative figures of net change of popula-
tion of the NE region.
Education impact: it is measured by the participation rates of children/youths in
Primary and lower secondary education (Fig. 8.8)/Rate of early leavers from edu-
cation. Preliminary expectations are that the CSR’s activities increase the
Fig. 8.8 Participation rates in primary and lower secondary education by regions at NUTS 2 in
Bulgaria (%)
8 Corporate Social Responsibility in Bulgaria: Perspectives … 153
participation and decrease the early leaver’s rate of child in the education system by
inclusion children of the social excluded families.
Unfortunately the figures do not allow the confirmation or rejection of the above
results.
The given results could be better understood by presentation ones of the best
examples of CSR in Bulgaria in different regions and sectors:
A. Marketing: Danone Bulgaria (Dairy Sector): South-West region
Danone has officially set foot in Bulgaria in 1993, when the Group Danone
acquired the state enterprise “Serdika”. For many years, the company is developing
in various socially responsible practices, some adapted from the parent company,
while others are purely local. Danone Serdika is a company that since its creation
linked to the health of people is inherent in her genes. The mission of Danone, it
gives health, through its products an increasing number of people around the world.
In 1972, Group Danone is committed to so-called dual model of management,
business—it combines the usefulness for business (economic) and society (social).
It is based fits the belief that a successful business goes hand in hand with
investment in the society. From the first day in Bulgaria, Danone rigidly to the
model, this for many years finds manifestation in various projects expressing our
socially responsible activities. The Danone’s strategy is to support a smaller number
of projects, but for a much longer time. We believe that in this way the support is
comprehensive and much more tangible. Since 01 January 2013, the projects
Danone is working actively and focused on the external for the company audiences
are:
• “Denoniada”;
• “Active and healthy”;
• “The hour child”;
• Donations of products
• Initiatives aimed at environmental protection—a project to reduce carbon
emissions, the initiative “Put a tree branch with Danone” and “Earth Hour”.
As part of the Group Danone, “Danone Serdika” AD has formalized a policy on
environmental protection from 2004, when confirms to the international standard
for environmental management ISO 14001. The company‘s efforts towards envi-
ronmental protection, however, date back to earlier. The protection of nature, it is
inherent in our mission, namely “to bring health through healthy food in the greatest
possible number of people”, and as we know, clean and healthy food comes from
nature.
With 2001 on the territory of “Danone Serdika” daily ensures the selective
collection and recycling, management of hazardous substances, water consumption,
thermal energy and electricity, with the aim of optimizing processes and reducing
consumption of natural resources per unit of output.
Since 2008, Danone implemented a procedure to measure of carbon dioxide
(CO2) through a representative sample of their products. As a rule, an effort they
154 D. Kopeva et al.
Assarel-Medet JSC processes about 13 million tonnes of ore per year; thus,
ensuring sustainable and stable development and production at thorough utilization
of the mineral raw materials of the Assarel deposit.
In respect of CSR, the company is implementing the philosophy of the approach
in the area of working conditions, human capital, ecology, sponsorship and
partnership.
In the field of work conditions, Asarel-Medet JSC follows and strictly imple-
ments the rule that achieving corporate success is interlink with respecting moral
values and meeting ethic, legal, environmental and social anticipations of the
society to the company’s activity. Voluntary, profoundly realized and rationally
motivated commitment of the company to the priority care for environment pro-
tection, safe labour conditions, personnel development, human rights and social
needs consideration.
Systematic risk evaluation and application of higher standards of occupational
safety and health, which meet at least the minimal requirements by the legislation
and the OHSAS 18001:2002 international specification under which our company
was the first to be certified on 19 November 2003. Measures are: monitoring and
planning of complex and preventive measures in order to reduce and eliminate the
risk for the personnel health and life and to improve the labour conditions of all
people working in the company; unconditional observance of the occupational
health and safety requirements by the personnel and business partners on the ter-
ritory of the company; use of high quality working and special garment and
approved personal safety devices by workers; provision of efficient preventive
medical checks, high quality medical care and the highest level of health and life
insurance for all workers and employees; developing high health culture of the
personnel as an important prerequisite for a healthy and safe way of life; active
cooperation between the management body and representatives of the workers and
employees in order to ensure healthy and safe labour conditions.
Assarel-Medet JSC is active in partnership and sponsorship at local and regional
level. It is possible to be distinct following areas of involvement:
• Active involvement in the social and civil dialogue through successive actions
in order to create economic stability and social security.
• Donation orientated policy with a priority towards implementation of significant
infrastructure projects and life standard improvement in the municipality of
Panagyurishte—the place where we work and live and where our children and
grandchildren grow.
• Assistance for establishing cooperation between the municipality and dynami-
cally developing European and other cities based on our company’s high
prestige and contacts with international partners.
• Active involvement and encouragement of the regional, national and branch
association formation and efforts uniting in order to create favourable business
climate.
8 Corporate Social Responsibility in Bulgaria: Perspectives … 157
• Public–private partnership with the municipalities and the state along the
technological chain for copper mining and processing in the region of the central
Sredna Gora mountain through the Srednogorie Med Industrial Cluster.
• Sharing the sustainable development principles of the UN Global Compact of
which our company is a member.
• Contribution to Bulgaria’s authority establishment in front of the European and
world community. Participation in Euromin, the World Mining Congress and
support for the participation of Bulgaria in prestigious international initiatives.
The overall acceptance of the concept for corporate social responsibility is very
important for the development of the modern society as the European commission
has defined CSR and published strategy on CSR in 2011.
The main idea of the CSR is the definition of the role and the responsibility of
the contemporary business economic, social and ecological development of the
society as the long term social expectations are stronger than the short term profit
expectations of the business.
Nevertheless, as the CSR is a concept of establishment business activities and
outcomes for society and ecology sustainability, the CSR has done on a voluntary
basis since now. Even though there is no exact list of activities describing the CSR,
we can outline three basic elements of the corporate social responsibility:
employment development as salary and tax payment as well as creation of new
jobs; social development as life being and labour infrastructure building; and social
inclusion and ecological development as charity to local social and ecology
infrastructure improvements.
By analysing, some good practices of CSR we could develop five directions that
explain the CSR’s impact over the regional development: (i) Gross domestic pro-
duct (GDP) per capita/Purchasing power standard (PPS) per capita;
(ii) Employment/Unemployment rate; (iii) In-patient average length of stay/
Hospital days of in-patients/Number of people at risk of social exclusions;
(iv) Participation rates in education/Education exclusion; (v) Rate of natural change
of population/Rate of net migration.
Analysis of Bulgarian case of CSR could be summarized in two directions:
• The highest CSR costs are done in south-west region. Thus, all of the indices
mention above are over exceeded the average level of Bulgaria and there is
some times difference with the next region.
• The case of south central region is interesting were the example of
Assarel-Medet is found. The results of the region differ as the CSR campaign of
company has changed. For example, with the indices of employment/
unemployment rate at the south central region: a middle position is in the
158 D. Kopeva et al.
both indices, but they have highest change rate during the observed period as
they sharply increase/decrease 2005–2008 and 2012–2015, and vice versa:
sharply decrease/increase 2009–2011.
In conclusions, a more deep information base for CSR costs is needed to be built
a decision-making cause-reaction business model.
References
Diana Kopeva is a full time professor at the University of National and World Economy
(UNWE), Sofia, Bulgaria. She gives lectures on Strategic management, Entrepreneurship,
Business Planning, Cost-Benefit Analysis and Project Management. She has more than 100
scientific publications, based on his research interests. She is one of the leading researchers in the
area of business economics and entrepreneurship in Bulgaria. Her research interests are in the field
of start-ups, corporate social responsibility (CSR) and circular economy. She participated in
numerous projects (national and international) focused on CSR and transition from linear to
circular and regenerative economies.
Nikolay Sterev is full time professor in Organization and management of marketing at the
University of National and World Economy—Sofia (UNWE), Bulgaria. He is Head of Industrial
Business Department at the Business Faculty. He is Chairman of Association of Professors of
Industrial Economics and Management (APIUI). Main research field are: industrial growth,
leadership and marketing leaders, START-Ups and entrepreneurship, CSR in industry, industrial
marketing management.
Dimitar Blagoev is a associate professor at the University of National and World Economy, Sofia,
Bulgaria. He has Ph.D. degree in the field of Business Economy. He is a deputy Dean of Business
Faculty in University of National and World Economy. He actively participated as a lecturer in the
Institute for Postgraduate studies. At the University of National and World Economy he teaches
courses in Investments, Innovations, Economics of Enterprise and Innovation leadership. He has
more than 60 scientific publications, based on his research interests, in the field of innovation,
investments, industrial dynamics, human resource management. He participated as a trainer and
expert in projects (national and international) aiming increase of competences and skills of labour
force and development and implementation of investment and innovation projects.
Chapter 9
Property Inheritance by Women
in Kosovo
Simeana Beshi
Abstract One of the most important challenges in Kosovo remains the rule of law.
In Kosovo society, women are discriminated against in terms of the division of
inheritance in relation to males; although, legally the property should be divided
equally. In Kosovo, there are still barriers in that direction. Today in Kosovo, there
is a weak rule of law in general, since it still shows the dominance of patriarchal
practices, especially in rural areas, where inheritance is not shared as defined by the
law, as well as property created during matrimony is not recorded as property of
both partners. Lack of proper realization of women’s rights in general and insuf-
ficient existence of property rights on property acquired during the marriage life, in
particular, is a major obstacle to the development and empowerment of women in
Kosovo. Gender equality in our country is very controversial. Tradition is con-
sidered one of the key factors that made women in Kosovo more reluctant in search
of the right for inheritance. Some people see the request of the inheritance of
women as a risk of weakening or total termination of relations of the woman with
her family. The number of proceedings initiated in the courts for heritage profit is
only 10% of them are initiated by women, making 90% of them are initiated by
men. Although Kosovo is still rather traditional, it is still raising awareness of the
equal right to property, for both genders, compared with the past. The mentality has
changed in urban areas of Kosovo, while in rural areas still it is dominated by
traditional mentality. Through the treatment of this topic, I will aim at increasing
respect for human rights and fundamental freedoms by women’s rights in Kosovo.
S. Beshi (&)
Faculty of Law, FAMA College, Pristina, Kosovo
e-mail: [email protected]
9.1 Introduction
Heritage is an ancient social category. It was first shown from the early stage of
development of human society, when some of the best material, in addition to the
social community, belongs to the designated persons. Legal basis for the deter-
mination and implementation of inheritance rights in Kosovo is the Law on
Inheritance of Kosovo it is based on the principle of equality in inheritance between
men and women. Kosovo laws guarantee equal rights and non-discrimination. The
right to own and inherit in terms of both the men and women indiscriminately. The
right to inherit is among the fundamental principles of human rights without dis-
crimination guaranteed by the international conventions.
Referred to various factors that affect the property’s heritage separating women,
such as the preservation of family relations, patriarchal traditions, education,
unemployment, (…) that reflect the typical traditional mentality of Kosovo society.
Although the right to inheritance is regulated by law and international conventions,
in Kosovo, it is practically solved by traditions and customs.
The customary law recognizes only a man as the heir and that is the reason that
drives most women to give up the right to inherit. Right codified still unable to
supplant the customary rules. The Canon continues to be present in rural areas as a
regulator of relationships hereditary.
The main scientific question is how women are heirs of property in Kosovo. The
aims of this study are:
– To increase institutional law enforcement for heritage and gender equality law;
– To increase the number of women on the use of their right to own and inherit
property;
– Enriching the knowledge of beneficiary parties and relevant officials;
– The impact of traditional unwritten rules on the welfare of women in the real-
ization of inheritance and property rights;
– Strengthening the role of women and her awareness of the general public in
relation to inheritance and property rights.
Based on the conducted scientific research and literature review, we formulate the
main research question:
How much are women heiress of property in Kosovo?
To answer the main question we formulate the research hypotheses as follows:
Hypothesis 1: Males inherit more and women much less. There is a great imbalance
in favor of males heritage.
Hypothesis 2: Functionality of notary impact on improving the position of women
in terms of common property.
“The right of women to take legal action is limited […] and its ability to seek action
by the courts. In others, her status as a witness or her evidence is less respected or
weight less than any male. These laws or traditions restrict women’s right to seek or
retain her equal share of property and diminish her position as a member of the
independent, responsible, and valued member of her community” (Instituti
Gjyqësor i Kosovës 2012).
Illiteracy in Kosovo continues to be gender and age issue. Women in general are
more than twice as illiterate than men (7.5% vs. 3.3% in urban areas and 11.3%
compared with 5.5% in rural areas) (Population of Statistic Department 2011).
The Constitution of the Republic of Kosovo, Article 22, for the advancement of
the rights belonging to both genders in general and women in particular, has
9 Property Inheritance by Women in Kosovo 163
Since 2012, it has begun functioning of notary service; the courts are observed
reduction of the hereditary materials to the area. Notary has enabled citizens to
exercise their rights more quickly and easily. From the work of notaries practice
proved that no transaction or transfer of property is not done without consent of
both spouses and women, respectively. This is an important step to support women
in the field of heritage and common property.
From the sayings of the above mentioned, we can say that, despite the existence
of legal infrastructure in which women are treated as equal inheritance, practice
shows that the right of women to inherit, despite evolutionary changes, after 1999,
is still far from legal provisions because of the mentality, traditions and specific
position of men in the family.
9.3.1 Sample
In this study, it is used the probability sample groups (clusters) so that each group
represents or is a representative of the complete population. The population is
divided into several groups (clusters), each representative of the population.
A selection of study groups and are all units in the selected groups. The reason for
the selection of the sample relates to the eligibility level and provides a better
representation of the population for hereditary issues.
In seven municipalities in Kosovo were surveyed judges from civil field, notaries
and clerks, because hearing for inheritance begins and ends in the presence of these
profiles. The research surveyed ten judges who deal with the examination of civil
cases in seven Basic Courts of the Republic of Kosovo: Pristina, Prizren, Peja,
Gjakova, Ferizaj, Gjilan, and Mitrovica. Parts of the survey were seven clerks and
13 notaries from the municipalities of Kosovo. Total part of the survey respondents
were 30 profiles above mentioned.
It is applied detailed interviews with professionals in the field. Data collection
was conducted through personal interviews and direct written and e-mail, then the
data/information sources are primary. The next will be presented samples of
selected tables and charts (Fig. 9.1; Table 9.1).
166 S. Beshi
This research was conducted through a questionnaire, which contains a total of ten
(10) questions about the implementation of property rights and inheritance of
property by women in Kosovo.
Questions are considered to be sufficient to demonstrate the gap between laws
and their practical application in society. Opinions of the respondents about the
property’s heritage of women in Kosovo, containing questions, which give infor-
mation on whether the provisions are foreseen by the law on the right to property
inheritance for women and their access to inheritance. The challenge is not faced
ex-officio initiation of the law on inheritance, in terms of reviewing the heritage of
the responsible official, who mostly disaffects women and customary law.
The survey was conducted through direct interviews with professionals in the
field area, where the possibility of mistakes is small and the data are more accurate
and more reliable. Submission of survey questions has become so generalized,
which gives more opportunities to respondents, to escape the essay question and
9 Property Inheritance by Women in Kosovo 167
9.5 Discussions
proposals are not made until many years after the death of the testator. From the
data provided by the courts, we conclude that the death certificate is marked not
by all heirs, especially female heirs are not included.
4. Discriminated women do not file a claim and do not require to be entitled to
judicial decisions. According to court statistics, the number of proceedings
initiated lawsuits in the contentious procedure by women is extremely small, or
not initiated any subject for that matter.
5. The relevant municipal authority (registrar’s office) does not provide regular
monthly court information about documents of death certificates that issued to
citizens. At the entrance to the civil registry service, we did not find any public
announcements, which reminded citizens that false declaration of family status
and giving false testimony by witnesses is a crime and they are sanctioned if
they do act such.
6. Obtaining information from the Office of Civil Status, for each death certificate,
we have found in many cases that many female successors in death certificates
do not appear at all. Not included in the civil registers of all family members
and unreported deaths courts.
7. According to officials interviewed by the Civil Registry Office of the obstacles
they encounter in which are: insufficient human resources (lack of staff) and
financial services, the lack of space in the office and lack of adequate equipment
to work. Increasing the number of staff made only during the summer to
accommodate the additional requirements for the needs of the diaspora.
8. Judicial practice and research conducted with notaries, proved that men possess
more and women possess less, there is a large gap of inheritance in favor of
men, while the region of Pristina and Prizren lead to cases when women inherit
hereditary wealth. Even in the few cases, where women inherit dominance
observed in urban areas, much less to say at all in rural areas.
9. Despite that by law women and men inherit equally, in practice, when several
factors affect women waive the right of realization of the right to property and
inheritance. These factors are: the social, economic, traditional customs,
maintaining relationships with brothers or family, avoidance of conflicts,
non-efficiency of the courts, etc., ignorance of the law. The reasons and causes
of the phenomenon of our heritage are largely patriarchal society, where tra-
dition and law collide with each other.
10. Patriarchal traditions, living in large family community always had a negative
impact on the development of women’s rights to property and inheritance.
However, the establishment of education, educational, intellectual, and cultural
level, invasions from one place to another, it has contributed to our families,
relatives, society emancipated, and feminine in supporting the realization of
property and inheritance rights. If women encounter obstacles from family,
necessary for the inheritance, the law on inheritance, the law on gender equality
and anti-discrimination law obliges the state bodies and courts to protect the
rights of citizens and thus also women’s rights.
9 Property Inheritance by Women in Kosovo 169
11. Since 2012, it has begun functioning of the notary service, the courts are
observed reduction of the hereditary materials to the area. Notary has enabled
citizens to not face delays in the processing of cases of inheritance, prolong the
proceedings, delays in execution of court decisions and other procedural
problems. Now citizens of their rights of inheritance can realize without delay
and in a shorter period of time. Notary offices engage more in verification of the
heirs, before issuing a document on the right to inheritance.
12. From the work of notaries, the practice proved that no transaction or transfer of
property is not done without consent of both spouses and women, respectively.
This is an important step to support women in the field of heritage and common
property. Functionality of notary services has led citizens to provide services
more quickly and easily and improvements of the position of women in terms
of the common property, as it is considered that it is registered in the name of
both spouses.
9.6 Conclusions
This study has its limitations, because it studies the property and inheritance of
property by women only in Kosovo. The findings are based mainly on the territory
and population of the Republic of Kosovo. It had to be used the quantitative
research methodology, statistical data collection by the court administration, the
civil registration offices, notaries, and municipalities across Kosovo, which lacks.
It explores only the Republic of Kosovo, therefore, future studies should be
extended to other countries in the region, namely in the neighbors states, using
comparative analysis between Kosovo, Albania, Macedonia or other countries
beyond.
In the research, females are have not been surveyed to understand their views on
“Heritage property by women in Kosovo,” how they consider the practical
implementation laws. Much of the research is conducted by respondents with ethnic
Albanians, leaving aside the inclusion of minorities.
The research can be extended to other countries in the region, namely in neigh-
boring countries and beyond, and the application of the comparative method.
Comparison of inheritance of property by women in Kosovo to other countries in
the region still presents an opportunity to research the future by academics and
experts in this field, but also by local NGOs in various countries of the Republic of
Kosovo.
In the future research, it should be expanded the circle of respondents and
increase their number, so that the information collected would be more convincing
and the possibility results be more realistic. The study should be expanded in terms
of inclusion of communities living in Kosovo, in order to possess the attitudes
resources and their position as part of Kosovo society about the property and
inheritance of property.
In the future, civil society, NGOs, and law-making institutions should organize
awareness campaigns for citizens (through public debates, brochures, and social
media), especially among the youth regarding property and inheritance rights of
women.
9 Property Inheritance by Women in Kosovo 171
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The protocol to the convention on the elimination of all forms of discrimination against
women, the European convention on human rights. https://www.un.org/womenwatch/daw/
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Simeana Beshi born on May 15, 1991, in Prizren, Republic of Kosovo, a Ph.D. Candidate in the
field of Financial Law, at the University of Pristina “Hasan Pristina,” in Pristina, Republic of
Kosovo. Works as: Assistant Teacher at Public University of Prizren “Ukshin Hoti,” Faculty of
Law, str. “Rruga e Shkronjave,” no. 1, Prizren 20000, Republic of Kosovo; Lecturer at Kolegji
“FAMA”, Faculty of Law.
Chapter 10
Women Rights for Sustainable Business
and Entrepreneurship: Case
from Balkan Area
10.1 Introduction
The concern of measuring gender inequalities emerged in the academic and political
environment after 1990, along with the awareness of the actual connections
between social risks and the presence of these inequalities, also as a result of
highlighting the associations between these and economic growth (Dollar and Gatti
1999a). Economic developments depend on many criteria that one of them is
contribution women to economy. According to United Nations, Women Reports
“When more women work, economies grow. An increase in female labour force
participation—or a reduction in the gap between women’s and men’s labour force
participation—results in faster economic growth” and also means healthy kids.
Evidence from a range of countries shows that increasing the share of household
K. T. Çalıyurt (&)
Business Administration Department, Trakya University, Edirne, Turkey
e-mail: [email protected]
are also located within the geographic region defines as Balkan peninsula
(Encyclopaedia Britannica 2018).1
In this study, women rights in business in Balkan area and their ranks in GII,
report results, academic researchers related to women rights in business in Balkan
area and international pressure group activities and their reports are discussed.
1
http://reports.weforum.org/global-gender-gap-report-2015/rankings/.
176 K. T. Çalıyurt
Fig. 10.1 Preferred salaries when men and women are up for the same role. Source 2017 Women,
work, and the state of wage inequality, https://hired.com/gender-wage-gap-2017
In 2007, Xbank, the first bank in Turkey to support women entrepreneurs who want to start
a business with Women Entrepreneur Loan, has also been in the pioneering position in the
sector as the first public bank to use TV banking and have offshore branches abroad. The
bank gives great importance to backing up women with an entrepreneurial spirit who aim to
establish their own business and the improvement and strengthening of businesses that are
driven by women’s labour force. In this context, the Bank which has continued its support
for women entrepreneurs since 1994, with its collaboration with KOSGEB Small and
Medium Industry Development Organization, has supported approximately 800 entrepre-
neurs with the training held in 17 provinces in 2013.2
While positive things are happening in the business sector, women in business
have many problems, however, sometimes problems are created by women as
follows because of lack of self-confidence. 69% of the time women in the industry
ask for less money than men. This example shows up that women should improve
her self-esteem (Fig. 10.1).
Laçka and Rushani (2016) stated that “Albanian nation historically has been
regressing in the emancipation and integration of women in society. However, in
recent decades, it can be said that satisfactory progress has been made in this
direction, but it is not enough. There is not a fact that women are banned from male
influence, but there is still a deficit, especially as regarded to older generations and
the middle ones. Now we have enough examples in society for successful women
and ladies, as in education, politics, as well as in the sphere of business. Even the
women have too many good examples of cooperation, such as cases of various
organizations and initiatives by women politicians that know and want to eliminate
partial ideological differences for the benefit of society and the common good.
Therefore, it is necessary to sensitize the whole society on the mass education of
2
Caliyurt and Oruç (2016).
10 Women Rights for Sustainable Business and Entrepreneurship … 177
women, emancipation and its full integration into society. This should be supported
by both genders, but especially from females, from women who have already been
successful, so women to enjoy their rightful place in society and not to become a
tool of calculations through quotas, but to fight with all democratic means to be
equal in representation”.
There are important laws for protecting women in their current and business life.
The most important regulation is the CEDAW agreement. Equality of rights for
women is a basic principle of the United Nations. The Preamble to the Charter of
the United Nations sets as one of the Organization’s central goals the reaffirmation
of “faith in fundamental human rights, in the dignity and worth of the human
person, in the equal rights of men and women”. Article 1 proclaims that one of the
purposes of the United Nations is to achieve international cooperation in promoting
and encouraging respect for human rights and for fundamental freedoms for all
without distinction as to, inter alia, sex. The Convention of CEDAW defines
discrimination against women as “… any distinction, exclusion or restriction made
on the basis of sex which has the effect or purpose of impairing or nullifying the
recognition, enjoyment or exercise by women, irrespective of their marital status,
on a basis of equality of men and women, of human rights and fundamental
freedoms in the political, economic, social, cultural, civil or any other field” (http://
www.un.org/womenwatch/daw/cedaw/). In the following table, we will discuss the
reports published by shadow NGOs related to CEDAW commitment by countries
(Table 10.1).
As seen in the table, NGOs’ comments are very strict on regulations for
governments.
Social gaps caused by gender differences were evaluated for the first time by PNUD
(UNDP) using two composite indicators:
• Gender-Related Development Index and
• Gender Empowerment Measure.
Among the criticisms these indicators have been subjected to, we note their
inability to adapt its territorial context of the phenomenon. The most popularized
quantification methods for the gender inequalities are proposed by PNUD (UNDP),
which produced two synthetic indicators used worldwide:
Table 10.1 Shadow groups reports related to Cedaw regulatıons in Balkan area
178
Country Population and female Higher education Wages Gender gap Women in decision Women entrepreneurship
population making
Albania Albania total population In Albania, there are 31% In 2014 in Albania, the The gender pay gap is As of 2014, Albania has According to INSTAT in
(http://www. of 2,893,000 inhabitants women with the title gross average monthly 10% (Institute of not achieved any of the 2014 (The Institute of
un.org/ consists of 49% women Professor versus 69% wage per employee is Statistics of Albania targeted quotas for Statistics 2015), the
womenwatch/ and 51% men (http:// men, 51% Ph.D.s versus 45,539 Lek. For men (INSTAT) 2014). That women participation in P percentage of women
daw/cedaw/; www.instat.gov.al/en/ 49% men, and 62% employees, the total means that men parliament (The owners/administrators of
Arqimandriti home.aspx). 42.8% of the docents and pedagogues average monthly wage is employees have a gross Organization for Security enterprises is 28.5%. The
and Llubani population lives in rural versus 38% men. 47,664 Lek and for average monthly wage and Co-operation in percentage of women
2018) areas, and 57.2% lives in Although that we have women, employees are 10% higher than women Europe average 24.8%, owners/administrators in
urban areas more women than men 42,852 Lek employees. Gender pay Beijing Platform target small enterprises (1–4
with the title Ph.D.s or gap varies depending on 30% and CoE employees) is
pedagogues men are the type of enterprise recommendation 40%). significantly higher than
ruling the system of ownership. The gross In the Organization for in other categories. From
education with 12 rectors average monthly wage Security and 2005 to 2014 the rate of
men versus 1 woman, 14 per employee in foreigner Co-operation in Europe women owners/
deputy rectors men enterprises is more than region, however, less administrators has
versus 9 women, 183 two times higher for men than half of the countries increased in all groups,
men as members of compared to women. For have reached any of the with the highest increase
Senate versus 90 women employees in public set targets and for enterprises with 1–4
and 44 men versus 15 enterprises, the gender recommendations (with employees,
women as deans, chiefs pay gap is almost only four countries that approximately 6%.
of department 170 men insignificant (−1%). In have exceeded the 40% During this period, for
versus 102 women Albanian private recommendation of the big enterprises with more
enterprises, the gender CoE) than 50 employees, the
pay gap is 8%, whereas in growth is 3.7%. During
Joint venture enterprises the year 2014 from
this indicator is 37% 17,377 newly created
enterprises, 31% of them
owned/managed by
women and 69% by men
(INSTANT-The Institute
of Statistics 2014)
(continued)
K. T. Çalıyurt
Table 10.1 (continued)
10
Country Population and female Higher education Wages Gender gap Women in decision Women entrepreneurship
population making
Bosnia and Bosnia has an estimated World Bank revealed in Another frequent form of The National Gender In B&H, women hold Self-employed females in
Herzegovina 2018 population of their annual report of 189 violating women’s labour Action Plan on Gender 24.1% of top managerial 2014 were 19.1% while
(Petrid et al. 3.50 million. Women world economies (World rights is related to Equality (GAP), adopted position and 27.2% own males was 21.8%.
2018) population is 43.1. Bank 2015) 2 ranking maternity pay which is, in initially in 2007 and a business. Kosovo is a Regarding different
Regarding gender that shows how easy is to most cases, lower than renewed to cover the little bit lower, top industry sector
proportion in the do business in each the wage earned during period 2013–2017, builds management by females employment of females,
employment rate in 2014, country. According to work. The budget on national and global was 7.2% while business 60% of them were
the above report showed this report, B&H takes continually lacks funds conventions and owner was 11.1% of employed in services,
that there were 41.2% one of the least ranks in for maternity leave strategies (e.g. CEDAW, women (Palalic et al. 23% in agriculture and
men and 22.7% females the Balkans. Ratings payments and in the EU, UN) to promote the 2017b) 16% in non-agricultural
while regarding among them are period of crisis when the implementation of the or other related industries
unemployment rate, there Macedonia in 12th place, State reduces pricey LGE. It is complemented (Palalic et al. 2017c)
were 31.2% females and Croatia 40th, Montenegro security transfers, the first by the Financing for the
25.2% males 46th, Serbia 59th, on the target are the Implementation of the
Kosovo 66th, B&H79th budgets intended for Gender Equality Action
and Albania 97 the. For women and marginalized Programme (FIGAP)
domestic, especially groups (Idžakovic 2013) adapted to provide for the
foreign investors, this is a law’s long-term
significant burden if they implementation (Djulic
decide to invest in this and Kuzman 2013;
country (Palalic et al. AGEBiH 2016). Main
2017a) priorities in FIGAP
include ensuring
Women Rights for Sustainable Business and Entrepreneurship …
Country Population and female Higher education Wages Gender gap Women in decision Women entrepreneurship
population making
Bulgaria It’s estimated that Although the Bulgarian The gender overall The gender pay gap in The main policy Female entrepreneurship
Bulgaria has a population government has adopted earnings gap is the Bulgaria widened from commitments in the area continues the upward
of 7.04 million in 2018. many documents in the difference between the 12.3% in 2008 to 13.5% of gender equality in trend globally. Latest
There are 1053 females past 15 years which average annual earnings in 2013, but was still Bulgaria are set out in the research shows that
for every 1000 males introduce policies and of women and men. It better than the European national strategy for women’s entrepreneurial
(Bulgaria Population programs for takes into account three Union average, going by gender equality 2009– activity is up 10%,
2018) development and types of disadvantages figures released by EU 2015, which aims to closing the gender gap by
improvement of women face: statistics office Eurostat “provide guarantees for 5% since 2014. In the
economic, social and • lower hourly earnings; ahead of International equal access to resources past year, 163 million
health situation of Roma • working fewer hours in Women’s Day on March and similar participation women were starting
people, it must be noted paid jobs; and 8, 2015 (Gender pay gap of both women and men businesses across 74
that the country’s • lower employment rates in Bulgaria … 2018) in decision-making, with economies worldwide,
second-biggest minority (for example when a view towards their while 111 million were
group is still at the very interrupting a career to successful personal and running established
bottom of all spheres of take care of children or social development and businesses. Among the
social organisation. The relatives). The gender the promotion of gender 63 economies surveyed
progress in educational overall earnings gap in equality in all spheres of in both this and the last
reforms is no exception Bulgaria stands at social, economic and report produced in 2015,
despite the presence of 22.8% (the average political life (National GEM found that Total
these political gender overall earnings strategy for promoting Entrepreneurial Activity
frameworks (Substantive gap in the EU is 39.6%) the equality … 2018)” (TEA) among women
equality and (The gender pay gap increased by 10%, and
non-discrimination … Bulgaria 2018) the gender gap (ratio of
2018) women to men
participating in
entrepreneurship,)
narrowed by 5%. These
(continued)
K. T. Çalıyurt
Table 10.1 (continued)
10
Country Population and female Higher education Wages Gender gap Women in decision Women entrepreneurship
population making
same economies show an
8% increase in women’s
ownership of established
businesses (GEM 2016/
17—Special topic report
… 2018)
Turkey 80,845,215 (estimated in The participation and Income differences are The Committee stated its Women make up only While the rate of Early
2017) Female population representation of women seen between genders at concern in its 2010 14.7% of members of the Stage Entrepreneurship in
constituted 49.8% of in decision-making every educational level, Concluding Observations current Parliament, a Turkey in 2015 was
Turkey’s population. mechanisms is but it is more common “about the discrimination figure well below the 17.4%, it dropped to
According to the formal consistently low (the among those with lower faced by women in global average of 22% 16.1% in 2016. However,
data provided by the highest rate of educational levels. By employment, as reflected and the 30% target set by this rate (16.1%) is still
Turkish Statistical participation by women 2014, compensation in the hiring process, the the United Nations higher then the average
Institute in 2014 the rate in Parliament to date is differences between persistence of a wide Economic and Social rate of efficiency-driven
of women’s participation 17.08%, while at the level women and men who gender pay gap and of Council in 1995, and a economies (14%).
in the labour force is of Mayor it is 3.7%). In have primary or lower occupational segregation, decline from the previous According to the Global
30.3%. This is one of the addition to that, women’s educational level is 18%. as well as women’s Parliament’s 17.8% (UN Entrepreneurship
lowest rates in the world. participation in decision- This difference is 17.8% concentration in Women presents gender Monitor (GEM) 2016/17
According to the same making mechanisms from among those who have agriculture in rural areas review … 2018) Global Report released
data, the employment rate bureaucracy to the high school and higher as unpaid family workers today by Babson College,
is 26.7%. When we judiciary, business life educational levels. The with no entitlements Universidad Del
exclude unpaid female and academia, is very same situation applies to within the social security Desarrollo, and Universiti
Women Rights for Sustainable Business and Entrepreneurship …
agricultural workers in limited. By February management positions. system [28]. Turkey’s Tun Abdul Razak, 55%
rural areas, women who 2015, on the one hand, By 2014, female gender gap overall places of entrepreneurs
receive allowances for the percentage of women managers earn an income it 130th of 145 countries, worldwide expect to
home care (who, currently serving as 6.6% lower than male according to the 2015 create at least one job in
incidentally, lack social governor was 2.4% and managers (NGO shadow Global Gender Gap Index the next five years. In
security rights) and as minister was 3.8%. report to the seventh of the World Economic general, the expectation
women who work The rate of women’s periodic report … 2018) Forum (http://reports. for growth among
part-time or under representation in weforum.org/global- entrepreneurs is low.
flexible conditions, the Turkey’s Higher Judicial gender-gap-report-2015/ However, the ratio of
(continued)
181
Table 10.1 (continued)
182
Country Population and female Higher education Wages Gender gap Women in decision Women entrepreneurship
population making
actual rate of employed Bodies are 14.2% rankings/). Turkey ranks early stage entrepreneurs
women is even lower. (TURKEY: Shadow 105th in educational who have the potential to
Furthermore, while the report summary … 2018) attainment, 105th in grow is high in Turkey
female unemployment political empowerment, and Turkey is second on
rate is 11.9%, this rate is and 131th in economic the list among the 62
much higher among participation and countries
young women aged 15– opportunity (Entrepreneurship
24 (20.4%) (TURKEY: Monitor (GEM) 2016/17
Shadow report summary global report … 2018)
… 2018)
Source Designed by the author
K. T. Çalıyurt
10 Women Rights for Sustainable Business and Entrepreneurship … 183
3
http://hdr.undp.org/sites/default/files/hdr2016_technical_notes_0.pdf.
10 Women Rights for Sustainable Business and Entrepreneurship … 185
women and men. It measures the human development costs of gender inequality.
Thus, the higher the GII value the more disparities between females and males and
the more loss of human development.
The GII sheds new light on the position of women in 159 countries; it yields
insights in gender gaps in significant areas of human development. The component
indicators highlight areas in need of critical policy intervention and it stimulates
proactive thinking and public policy to overcome systematic disadvantages of
women (Human Development Report 2016b).
United Nations Global Compact (UNGC) is called as “the world’s largest corporate
Sustainability initiative” which invites companies to align strategies and operations
with universal principles on human rights, labour, environment and anti-corruption,
and take actions that advance societal goals. The UN Global Compact’s Ten
Principles are derived from the Universal Declaration of Human Rights, the
International Labour Organization’s. Declaration on Fundamental Principles and
Rights at Work, the Rio Declaration on Environment and Development and the
United Nations Convention Against Corruption (2017). UN Global Compact has
also announced 17 “sustainable development goals” (SDGs) which provide a his-
toric opportunity to unite all global stakeholders to end extreme poverty, fight
inequality and injustice, and protect our planet. Among these goals, goal five is titled
as “Achieve gender equality and empower all women and girls” (2017).
Turkey, as a developing country, is trying to catch high-level standards in
business by applying international accounting, auditing, taxation, sustainability and
gender equity standards. A total of 246 Turkish institutions have signed UN Global
Compact and announced that these companies promised to follow principles and
goals published by UNGC. Among 246 Turkish institutions, 77 companies are
profit companies and 35 of these companies have also signed Women
Empowerment Principles (WEP). It is found that 74 companies have invited women
as a member in the board. Many studies stated that women existence inboard effect
companies performance and accountability. In this study, women existence in board
or/and signing WEP has positive effect on sustainability reporting [45].
10.7 Discussion
rate and infant deaths will decrease and finally the healthier, well-nourished and edu-
cated child population will increase (Yilmazer and Onay 2017).
It is necessary for women to be supported in the field of education, health, law
and freedom for the healthy development of the society and the more corporate
business world. As seen in the work done, women add value to the organizations
they are in many ways. However, advancement of women in organizations depends
on nine factors: friendships, personal factors, family responsibility, management
experience, work and family conflict, mentors and networks, organisational policies
and culture, societal factors, training and development (Caliyurt and Farooqi 2017).
These conditions should be provided by government- and business-related NGOs.
As a result, United Nations Development Programme Human Development
Reports Gender Inequality Index4 in Balkan area shows us there is a long way to
4
Gender inequality remains a major barrier to human development. Girls and women have made
major strides since 1990, but they have not yet gained gender equity. The disadvantages facing
women and girls are a major source of inequality. All too often, women and girls are discriminated
against in health, education, political representation, labour market, etc., with negative consequences
for development of their capabilities and their freedom of choice. The GII is an inequality index. It
measures gender inequalities in three important aspects of human development—reproductive
health, measured by maternal mortality ratio and adolescent birth rates; empowerment, measured by
proportion of parliamentary seats occupied by females and proportion of adult females and males
aged 25 years and older with at least some secondary education; and economic status, expressed as
labour market participation and measured by labour force participation rate of female and male
populations aged 15 years and older. The GII is built on the same framework as the IHDI—to better
expose differences in the distribution of achievements between women and men. It measures the
human development costs of gender inequality. Thus, the higher the GII value the more disparities
between females and males and the more loss to human development. The GII sheds new light on the
position of women in 160 countries; it yields insights in gender gaps in major areas of human
development. The component indicators highlight areas in need of critical policy intervention, and it
stimulates proactive thinking and public policy to overcome systematic disadvantages of women.
10 Women Rights for Sustainable Business and Entrepreneurship … 187
Fig. 10.4 Turkey’s rank in gender inequality index. http://hdr.undp.org/en/composite/GII. Accessed May 15, 2019
K. T. Çalıyurt
10 Women Rights for Sustainable Business and Entrepreneurship … 189
run to get better conditions for women in Balkan area however the accuracy of the
data is also a very important issue. It is recommended that the Balkan Business
Women and Women Academician Initiative Group be established to protect the
rights of women in the business world to decrease gender inequality in Balkan
Countries (Figs. 10.2, 10.3 and 10.4).
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Prof. Dr. Kıymet Tunca Çalıyurt CPA, CFE, graduated from the Faculty of Business
Administration at Marmara University, Istanbul, Turkey. Her master’s and Ph.D. degrees are in
Accounting and Finance Programme from the Social Graduate School, Marmara University. She
has worked as Auditor in Horwath Auditing Company, Manager in McDonalds and finance staff in
Singapore Airlines. After vast experience in private sector, she has started to work in academia.
She is holding CFE and CPE titles. Her research interests are in accounting, auditing, fraud, social
responsibility, corporate governance, finance and business ethics, with a special interest in aviation
management, NGOs, women rights in business. She has been as visiting researcher in
Massachusetts University Amherst Business School. She is the founder of the International
Group on Governance, Fraud, Ethics and Social Responsibility (IGonGFE&SR) which was
founded in 2009. In 2009, she also founded the International Women and Business Group, which
192 K. T. Çalıyurt
organizes global, annual conferences. Kiymet has published papers, book chapters and books both
nationally and internationally on fraud, social responsibility, ethics in accounting/finance/aviation
disciplines in Springer and Routledge. She is book series editor in Springer with the title
Accounting, Finance, Sustainability, Governance and Fraud: Theory and Application, and book
series editor in Routledge with the title Women and Sustainable Business. Some book titles:
Emerging Fraud (with Sam Idowu), Corporate Governance: An International Perspective (with
Sam Idowu), Women and Sustainability in Business: A Global Perspective, Sustainability and
Management: An International Perspective (with Ulku Yuksel), Globalization and Social
Responsibility (with David Crowther), Regulations and Applications of Ethics in Business
Practice (with Dr. Jiang Bian), Ethics and Sustainability in Accounting and Finance, Volume I.
She is acting as member in editorial board Journal of Financial Crime, Social Responsibility
Journal, International Journal on Law and Management, Journal of Money Laundering Control.
She is regular speaker at International Economic Crime Symposium in Jesus College, Cambridge
University. She is member in editorial board Social Responsibility Journal, Journal of Financial
Crime, International Journal of Law and Management. She is partner of Herme Consulting in
Trakya University Technopark.
Chapter 11
The Relationship of Public Banks
in Turkey with Sustainable
Macroeconomic Factors
This study was produced from the post-graduate thesis titled “The Place and The Importance of
Public Banks in Turkish Economy” conducted by Başak Oktay Akın in Trakya University,
Institution of Social Sciences, under the supervision of Inst. Dr. Enver Erdinç Dinçsoy.
B. O. Akın
Department of Banking and Insurance, Keşan Yusuf Çapraz School of Applied Sciences,
Trakya University, Edirne, Turkey
e-mail: [email protected]
E. E. Dinçsoy (&)
Department of Banking, School of Applied Sciences, Trakya University, Edirne, Turkey
e-mail: [email protected]
11.1 Introduction
The government also performs certain interventions on public banks for several
purposes. These purposes are briefly; to increase the reliability and strength of
financial system (Patrick 1966: 176), to prevent the market failures that may occur
due to asymmetric and costly information, to finance projects that are important in
terms of society although they do not possess profitability and to provide banking
services even in hard-to-reach areas to provide financial development (Micco et al.
2004: 6). Executing these purposes by government is vital in terms of the devel-
opment of the country and a sustainable macroeconomic growth movement.
Public-owned banks have earned the trust of people with government support
that has been coming from the early years of the foundation of Republic up until
now and acquired advantage against private-owned banks in many ways. However,
these banks that experience various innovations, have faced situations such as
transfer, merging and bankruptcy from time to time.
As shown in Table 11.1, 51 deposit banks in 1960 have increased to 56 in 1990
and to 61 in 2000, reaching its highest level. After 2000, the number started to
decrease again. Shortly, although banks demonstrate a significant increase after
1985, they cannot carry on service by staying in the sector for long years. Besides
there are 34 deposit banks today, only 3 of them are public-owned banks. Since
1960, public-owned banks could not be more than 14. Especially in 1985, the
introduction of many banks to the sector did not influence public-owned banks, on
11
Source https://www.tbb.org.tr/en/research-and-publications/research/17
195
196 B. O. Akın and E. E. Dinçsoy
the contrary their numbers are reduced. Private-owned banks however, did not
experience a significant change until 1990, reached the highest number in 1995 and
decreased to a number of 9 in time. Foreign-owned banks of which there were only
5 of them in the early years, have continued to increase in number with the change
in 1985 and the increase in the entrance of foreign capital to the country. Foreign-
owned banks have the highest number among deposit banks. Although develop-
ment and investment banks did not carry much service in the early years, they had
become more active after 1990 and have been keeping their seat in the sector since
2005. Investment banks could not carry out service until 2005 and these banks
which have become 4 in number in that year, are still active today.
To evaluate generally, the number of banks which was 51 in the early years of
banking business, has shown changes in time. It has experienced the biggest
increase in 2000 and has fallen to 52 in number by showing changes again.
Developing countries can support the growth by transferring the limited funds to
the sectors that can provide economic growth by loan. Banks electively provide
loans to the strong businesses, thus, they can provide increase in the event of the
conversion of funds, per capita income and growth rates. As shown in Table 11.2, it
can be observed that the share of public banks have increased in total loan volume.
This increase is an indicator that the public banks have carried out a significant
financial function in terms of Turkish economy. Furthermore, according to CBTR
data (Table 11.3), the share of general deposit volume of 3 (three) public banks,
Ziraat Bank, Halkbank and Vakıfbank, has increased up to 38% in April 2018.
Turkey Wealth Fund was established in August 26, 2016 by being announced in
Official Gazette. Some of the public organizations and some immovables were
transferred to this fund.1 Wealth Fund aims long-term investments to be made with
low interest environment. Furthermore, it is aimed to create a system that con-
tributes to the growth. After all, it is expected to strengthen funds by putting
forward public property and develop in economy.
1
Publicly owned shares and some immovables of Ziraat Bank and Halkbank were transferred to
Wealth Fund. The process about the transfer of Vakıfbank is in progress.
11 The Relationship of Public Banks in Turkey with Sustainable … 197
Table 11.2 Loan volumes in Year Public banks Banking sector Ratio (%)
Turkish banking sector
(in thousands) 2005 30,791,043.00 137,229,568.00 22
2006 43,203,134.00 192,070,142.00 22
2007 56,221,420.00 242,927,249.00 23
2008 73,904,750.00 302,010,858.00 24
2009 89,121,080.00 335,210,049.00 27
2010 131,215,641.00 483,818,493.00 27
2011 169,423,852.00 639,126,816.00 27
2012 189,617,429.00 759,762,194.00 25
2013 264,707,344.00 1,018,735,495.00 26
2014 319,439,801.00 1,209,005,135.00 26
2015 402,770,228.00 1,452,160,856.00 28
2016 492,772,822.00 1,686,908,873.00 29
2017 632,005,946.00 2,045,329,483.00 31
2018 728,267,942.00 2,283,353,775.00 32
April
Table 11.3 Deposit volumes Year Public banks Banking sector Ratio (%)
in Turkish banking sector
(in thousands) 2012 182,811,129.00 505,680,036.00 36
2013 215,391,989.00 592,817,263.00 36
2014 229,241,064.00 655,831,096.00 35
2015 259,701,266.00 705,882,250.00 37
2016 302,834,417.00 834,832,668.00 36
2017 354,942,265.00 943,429,943.00 38
2018 378,918,378.00 993,972,449.00 38
Nisan
Because of some conditions that public banks ignore while performing banking
activities, they may create problems on economy. Public banks that give loan to a
person or institutions that might have difficulty in repayment with the effect of
directed loans, increase the non-performing loans and this situation causes signif-
icant problems on budget by increasing the debts of the bank.
The place of public banks is extremely important in financial system with features
such as gathering savings, managing investments, shaping the sector with various
innovations and knowing the investors better in time and many researches were
conducted about their roles in economic developments. Generally, banks have two
opinions about government ownership; these are growth and political opinions. In
countries with financial system where growth is expected, a positive progress was
not observed for private banks which play the role of improvement by directing the
fund to the productive sector, hence governments have taken steps to carry out the
role of development banks with gathering savings by interfering banks and
directing them to strategic, long-term projects (Otchere 2005: 3). Governments use
public banks as a tool to execute their political objectives. Politicians provide
employment and subvention to their supporters in exchange for their support and
votes. According to this view, research reservation policies that emerge as a result
of governments’ taking banks to their ownership will slow down the financial
development.
In banking sector, unlike other sectors of the economy, the relationship between
the interaction in terms of competition and financial stability should be measured
well, while performing competition policy. Big competition (static) might be good
for productivity, but it may result in negative for financial stability (Allen and Gale
2004: 453). The financial stability might increase if the competition between the
banks will decrease, but the possibility of reduction in wealth emerges. Financial
stability is effective in the transfer of resources between the saver in economy and
producer. In the case of active performing of financial system, risks are distributed
equally and it causes financial system to be desensitized against unexpected situ-
ations. Since crisis environment prevents production, there will be a reduction in
production. Public banks in our country were established in order to enhance the
economy structurally, which was negatively affected by 1929 crisis. The govern-
ment aimed to interfere the economy more easily by using public banks as a tool
and to play a more active role in the economy with the policies it will implement.
Since the activity of public banks is slightly low compared to private banks,
competitive environment could not be established. Furthermore, because of the
possibilities and privileges provided to public banks, they have surpassed private
banks in some situations. Investors prefer public banks more, thinking that
11 The Relationship of Public Banks in Turkey with Sustainable … 199
government provides warranty and for this reason public banks which have a wide
customer portfolio acquire more funds compared to private banks. Possibilities that
are provided for public banks which allow customers to obtain high-income with
low costs have also reduced the competitiveness of private banks and prevented
them to be active within economic system. In his study, Yaşa (2008) mentioned
data measurement analysis in Turkish banking system between 2002 and 2004.
21 banks, 3 of them public banks, were analyzed. As a result of the analysis, it was
found that the most important factor in determining the activity of banks in the
sector is their size of assets. According to another result, public banks acquired
closer activity2 values than private banks.
According to Beck and Levine (2004), there is a direct relationship between
banking sector and growth. In the panel analysis study conducted for 40 countries,
covering the years 1976–1998, the development of banking sector was evaluated
with the loans provided to private sector and a positive development was deter-
mined in long-term. In their study, Aslan and Küçükaksoy analyzed economic
growth and financial development for each year. Causality relationship was
examined for the years between 1970 and 2004 and the Vector Autoregression
(VAR) Granger model was applied. As a result of the study, it was concluded that
financial development in Turkey affects growth or causes growth.
Towards the end of 1980’s, liberating capital mobility has made transnational
borrowing common. This situation has shown increase in 1990’s with the growth in
the countries’ need of source and loan demands with each other. Countries provide
financing through borrowing. Especially, underdeveloped countries prefer bor-
rowing from foreign countries in order to sustain their economy since they cannot
perform savings. Developing countries prefer external borrowing since their own
savings are inadequate. Developed countries should increase their share in eco-
nomic development by increasing production instead of reducing consumption
(Gündüz and Dinçsoy 2016: 220).
Governments should support subjects such as increasing employment, devel-
oping infrastructure projects, supporting big projects, education, transportation and
health as a priority (Karagöz 2002: 99). However, while executing these, since they
require a certain source, they are obliged to prefer external borrowing. As long as
this borrowing is not excessive, it can contribute to the economies of developing
countries.
2
At the same time, activity concept is determined according to inputs (number of branches, number
of staff) and outputs (interest income, investments) which were discussed in the study.
200 B. O. Akın and E. E. Dinçsoy
Since developing countries cannot provide enough savings, they balance deficits
emerging from current accounts with external borrowing. As long as the foreign
trade deficit which is the basic cause of current deficit is not narrowed, there won’t
be any recovery in the amount of external debt. For this, export strategy can be
improved by increasing the domestic production and if the country’s sources are
used effectively, foreign dependency would be reduced and balance of payments
process healthily.
As well as budget deficits are not seen commonly in developed countries, having
low external debt does not affect the budget in the process of paying the debt. Along
with this, factors such as capital inflow to the country, increase in exports, and
adequacy of foreign currency reserve are effective in the protection of balance of
payments.
In our country external borrowing is usually preferred in order to narrow the
deficit in the balance of payments or to pay the debts, however this situation have
emerged the condition of not being able to pay the debts. When the data for the last
5 years is examined (Table 11.4);
Although there is a decrease in the amount of loans that are used from IMF since
2012, total external debt has increased over the last 5 years. According to TSI data,
only Turkey does not possess external debt among OECD countries in 2016. While
our external debt is sustainable in short term, it does not demonstrate a very strong
structure in the long term. For this reason, giving importance to the subjects such as
export policies, domestic savings, reducing imported goods and domestic produc-
tion will be able to balance debts.
Since public banks are in competition with other banks in the sector, they gain some
advantages. Interest rates alteration, which is one these advantages, have provided
them an advantage by increasing the share of public banks in the market. Along
with this, since public banks gather official deposit with low interest rates, they can
gather sources with lower cost compared to private sector banks.
Since public banks do not have to worry about loss-making and can transfer their
losses to the Treasury cyclically, they did not abstain from giving deposits with
high interest rates. Against this situation, private-owned banks also increase their
interest rates in order not to lose the funds they have. Hence, banks in the system
can increase their interest rates successively.
In the case of experiencing liquidity shortage of public banks, money market
interest rates increase as well as deposit interests. Since private banks struggle in
bearing the cost of high interest rates, they cannot demonstrate much activity in the
system.
Financial markets are the markets that provide transfer of funds from those who
have fund surplus to those who have funding gap with financial intermediary
(Mishkin 2007: 23). Financial tools and financial institutions in this mechanism
help the system to operate effective and healthy. Banks which are important factors
in the effective usage of funds in the financial system contribute to the economy
greatly. Investors who have fund surplus want to make good use of their invest-
ments in banks and banks will give these funds to those who need them, thus, idle
funds will be evaluated.
In financial system, fund transfer is conducted through two ways, indirectly and
directly. In indirect finance, fund offerors transfer their funds to fund requesters
through financial intermediaries. These funds consist of deposit and loans in gen-
eral. In direct finance, on the other hand, fund offerors can give their funds to those
who request their funds without intermediaries. Tools that are used in direct finance
consist of capital market tools (bonds and stocks).
Because of the competition between the banks that are in the lead in deposit and
loan departments, some imbalances may occur in the system. For example, while
there are various practices such as the size of the deposit and interest rate while
raising fund, raising deposit with a single interest rate strategy in public banks can
be observed. This situation causes investors to prefer public banks instead of private
banks, hence public banks to profit at the end of the year.
Swap contracts used by public banks increase the profitability of both banks and
customers. Swap contracts are contracts in which the bank and investor changes the
asset in the type of currency with the interest applied on the asset or the responsible
in a given period. Hence, the risks that emerge with the changes in interest and
foreign exchange can be reduced. Investors prefer these financial tools in order to
make more profitable moves with less risk.
Possessing various precedence of public banks have become very important for
investors. They have created perception of trust because they are public banks and
their profitability have increased as much. Public banks which are one of the basic
structures of financial system contribute greatly to the operation of the system and
to the economy.
202 B. O. Akın and E. E. Dinçsoy
Among the founding purposes of public banks, there are many elements different
from private banks such as employment creation, contributing to the economy and
to the financial requirements of the government. Employment creation, which is one
of these purposes, have caused excessive employment with the increase in the
number of public banks’ branches and further this situation caused decrease in
quality and increase in expenses (Marston and ve Narain 2004) Public banks which
were aimed to be used as a tool to increase employment by the state, have faced the
increase in the expenses. However, banks’ increasing employment and their
increased activity as a result of the confidence they acquire may create some
imbalances in banking sector.
There hasn’t been a change in the number of public banks since 2010. But when
Fig. 11.1 is examined, there has been a significant change in the number of bran-
ches of public banks since 2012. The increase in the employee after 2014 is
remarkable as well (Table 11.5).
The number of employees is significantly higher than other banks. According to
UMT data, average employee number in banks is higher in public-owned banks
than private-owned banks between the years 1966 and 2016. With the increase of
3838 people between 1981 and 1986, the number of employees working in
public-owned banks has passed 9000. When private-owned banks are observed,
they demonstrate an increase of 193 people in the same period and come to a
number of 2736 employees. The other significant increase in public banks was seen
between 1996 and 2001, but a decrease of approximately 5629 people is observed
after the 2001 crisis. Finally, the average number of employees working in
public-owned banks has reached more than twice of the employees working in
private-owned banks in the year 2016.
11.8 Result
3
Banks of which their capital is covered by treasury on behalf of the public or statutory bodies.
11 The Relationship of Public Banks in Turkey with Sustainable … 203
Banks4 and Mixed-Owned Banks.5 On the other hand, location of banks of which
all of their capital is covered by foreign person and institutions are usually outside
of Turkey and these banks can open branches in Turkey if they want. There is also
Central Bank which was established in order to help to provide the stability and the
development in the economy by using various money policy tools, do not seek
profit and has the authority of all kinds of supervision and management. If
public-owned banks were evaluated specifically in Turkey, they have gained the
trust of the public with the support of the government from the foundation years of
the Republic up until now and acquired advantage against private banks in many
aspects. However, duty losses of public banks was liquidated as a result of
restructuring them with the purpose of privatization at the early years of 2000, more
caution was exercised in crediting activities and significant savings were provided
in their expenses. Today,6 public banks should find funds that have lower cost than
foreign markets, support growth and would contribute to the development.
4
Banks which was established by private person or institutions, not by public capital.
5
Banks of which some of their capital is covered by the government and some of them by legal
entities.
6
Publicly owned shares and some immovables of Ziraat Bank and Halkbank were transferred to
Wealth Fund. The process about the transfer of Vakıfbank is in progress.
204 B. O. Akın and E. E. Dinçsoy
Furthermore, public banks play an active role in the covering of financial needs of
municipalities, public institutions and organizations, SMEs, tradesmen and corpo-
rate firms under favorable conditions and in the finance of big projects.
On the other hand, public banks give a significant support to the construction
sector which is the locomotive of Turkish economy and mainly give credits to this
sector. However, for sustainability-focused growth they should possess the possi-
bility of marketing financial products in a wide range for policies that support the
real sector, take important steps towards source diversity and increase the share of
deposits. For a functionally sustainable macroeconomic structure to emerge, public
banks should bring fluidity to the financial system structurally, manage rational
physical asset, transform short-term funds to long-term funds, create deposit
money, develop trade and especially contribute to the fair distribution of income.
As a result, while public deposit banks provide people to gain interest income
from their savings on the one hand, they also carry out a significant function in
terms of financial markets by providing fund flow. However, for public banks to
contribute to a sustainable growth environment in Turkey, they should possess
strong capital base and balanced structure. In order to keep pace with global
competitive environment with the developing technology and the increasingly
difficult economic conditions, public banks should expand their service opportu-
nities in areas where financial system is in need of as well as accepting deposits and
giving loans.
References
Alam, H. M., Raza, A., & Akram, M. (2011). A financial performance comparison of public vs
private banks: The case of commercial banking sector of Pakistan. International Journal of
Business and Social Science, 2(11), 56–64.
Allen, F., & Gale, D. (2004). Competition and financial stability. Journal of Money, Credit, and
Banking, 36(3–2), 453–480.
Beck, T., & Levine, R. (2004). Stock market, banks and growth: Panel evidence. Journal of
Banking & Finance, 28(3), 25–38.
Gündüz, S., & Dinçsoy, E. E. (2016). İhracatın Finansmanında Eximbank’ın Rolü ve Performans
Analizi. Akademik Sosyal Araştırmalar Dergisi, 22, 218–228.
Karagöz, K. (2002). Türkiye’de Dış Borçlanmanın Nedenleri - Ekonometrik Bir Değerlendirme.
Sayıştay Dergisi, 66(67), 99–110.
Koç, C. (2000). İzmir İktisat Kongresi’nin Türk Ekonomisinin Oluşumuna Etkileri. Atatürk
Dergisi, 3(1), 145–167.
Marston, D., ve Narain, A. (2004). Painting the SFI landscape, observations from a survey of
state-owned financial institutions. In Conference on The Role of State-Owned Financial
Institutions: Policy and Practice. Washington D.C.: World Bank.
Micco, A., Yeyati L. E., & Panizza, U. (2004). Should the government be in the banking business?
The role of state-owned and development banks. Inter-American Development Bank Çalışma
Tebliği.
Mishkin, F. S. (2007). The economics of money banking and financial markets (8th ed.). USA: The
Addison-Wesley.
11 The Relationship of Public Banks in Turkey with Sustainable … 205
https://www.tbb.org.tr/Content/Upload/Dokuman/7349/TBB_sube_personel_bilgi_notu_100316.
pdf. Accessed May 15, 2019.
https://www.tbb.org.tr/modules/banka-bilgileri/banka_sube_bilgileri.asp. Accessed May 15, 2019.
Başak Oktay Akın has completed her B.A. degree at Department of Banking and Insurance,
Keşan Yusuf Çapraz School of Applied Sciences, Trakya University in 2014 and M.A. degree at
Department of Banking, School of Applied Sciences, Trakya University in 2018. As the research
area, she has focused on banking, insurance, and financial analysis. Additionally, she has some
scientific papers and presentations in her research field. She has also some certificates on Capital
Markets Licensing Level-3, Recruitment Strategies in Banking, Customer Relationship
Management, FX Technical Analysis Training, and Marketing and Sales Management, and
working experiences on automotive finance, insurance, and direct sales.
206 B. O. Akın and E. E. Dinçsoy
Enver Erdinç Dinçsoy is an assistant professor at the Department of Banking, School of Applied
Sciences, Trakya University. He completed his undergraduate degree at Karadeniz Technical
University, Faculty of Economics and Administrative Sciences, Department of Business
Administration. He completed his master and doctoral degree in Graduate School of
Environmental Science and Technology, Okayama University, Japan. As the research area, he
has focused on development, banking and finance, spatial analysis, and environmental economics
and policies. In these areas, he has scientific articles published in various national and international
journals, books and book chapters, and conferences. He gives undergraduate and postgraduate
courses within the scope of his research subjects and proficiency. He has also been the Director of
College of Uzunköprü Applies Sciences since 2017.
Chapter 12
Cultural Profiles and Assertiveness
of Women in Bulgarian Business
Environment
12.1 Introduction
and the employment relationship and cultural differences in the regulation of the
employment contract.
As the sixth glass-ceiling index of the economist shows, disparity between
countries remains wide. But women have made some progress towards equality in
the workplace in the past year. The index ranks the best and worst countries for a
working woman. Each score is based on average performance in ten indicators:
educational attainment, labour market attachment, pay, childcare costs, maternity
and paternity rights, business school applications and representation in senior jobs
(in managerial positions on company boards and in Parliament).
Employment rates in the EU continue to improve in line with continued growth
and improved labour market conditions. The employment rate for people aged
20–64 reached the highest rate ever recorded—72.2% in 2017. Even if employment
rate for women also reached it all time high, gender inequality persists on the labour
market. With the employment rate for men at 77.9% as compared to 66.4% for
women in 2017, the gender employment gap stood at 11.5% points the same figure
for the last three years (Fig. 12.1).
At the same time, increasing the employment rate of women aged 30–54 and
55–64 is considered to be a solution for a number of Member States in reaching the
overall 75% employment rate target by 2020, as it seems to have the highest
potential impact on the overall national employment rate in those countries.1 Partly,
it could be explained by the extended age for retirement for the women, that is the
case in Bulgaria, and with the general all times boom in the employment in the
developed countries. Much of the employment is in the services sectors now, and
that’s an extra opportunity for lowering the barriers for employing women.
Equality-conscious Nordics typically do well while workplace parity for women
in Japan, South Korea and Turkey still lags badly. America under President Donald
Trump rose from 20th to 19th place thanks in part to a higher female labour force
participation rate. Sweden ranks first, scoring well in female labour force partici-
pation, which is over 80%, and the share of women in Parliament (44%). Women
broadly lifted their presence in the workplace. There has been an increase in the
share of women in the labour force, with a tertiary education and of those taking
business school entrance exams, which are a pipeline for senior executive jobs. Yet
advances may be slower than anticipated. MSCI, a financial data firm, has pushed
back its estimate by a year to 2028 for when the global share of women on boards
will hit 30% (the figure is now 17.3%). Countries at the bottom of our index show
signs of change in cultural attitudes. Last year, the Global Summit of Women, a
business and economic gathering of over 1300 leaders from 60-odd countries was
held in Japan for the first time. The #MeToo movement, a social media campaign
against sexual assault and harassment, arrived in South Korea with fervour.
1
9 Key messages to accompany the Annual Employment Performance Report and Employment
Performance Monitor, Doc. 12690/18, available at: https://www.consilium.europa.eu/register/en/
content/int?lang=EN&typ=ADV
12 Cultural Profiles and Assertiveness of Women in Bulgarian … 209
Fig. 12.1 EU-28 trends in employment rates, people aged 20–64, by gender [%]
Female participation in the labour market is on the rise in Bulgaria. In 2016, the
employment rate of women (age 15–64) in Bulgaria was 60.0%. It increased by
3.7 pp between 2012 and 2016. However, women still do not participate in the
Bulgarian labour market to the same degree as men (66.7%). The difference
between the male and female employment rate was 6.7 pp in 2016.
Female unemployment in Bulgaria was 7% in 2016. The unemployment rate for
men (8.2%) was higher than for women. In addition to that, it is noteworthy that the
situation considerably improved for both genders since 2012: Unemployment rates
decreased by 3.9% for women and by 5.5% for men.
Overall, the general participation rate of Bulgarian women in the labour market
has decreased by 2.6 pp since 2012 and was at 64.6% in 2016.
210 M. Baltov and D. S. Mladenova
Part-time employment plays a minor role in the Bulgarian labour market. No more
than 1.9% of Bulgaria’s employees worked part time in 2016. Also, there is no
significant gender gap between women and men when it comes to part-time
employment. It can be said that women tend to work full time or not at all. The
numbers underline the predominant model of full-time work.
Good care infrastructure considerably facilitates women’s engagement in paid
work. The 2017 Commission initiative on worklife balance underlines its impor-
tance for both children and other dependents. In May 2018, the Commission
adopted a report on the Barcelona objectives.2 The report shows that there has been
further improvement since 2013 on the share of children under mandatory school
age being in childcare, but that some countries continue to seriously lag behind. On
average, in the EU-28, the target of 33% has been reached for children under the
age of three and the target of 90% has nearly been reached for children from three
until mandatory school-going age (Fig. 12.2).
Secondary and tertiary education attainment of Bulgarian men and women rose in
the last decade. With regards to tertiary education, however, the data suggest that
Bulgarian men lag behind in the rapid growth of attainment rates in Europe. With
regard to women‘s fields of study in Bulgaria, the trend for typical female fields of
studies follows the European trend: Women in Bulgaria make up for the majority in
fields of studies, such as “Teaching, Training and education science” and
“Humanities and arts”. Nevertheless, the trend for typical male fields of studies
shows a different picture: Compared to the EU-28, higher share of women in
Bulgaria pursue typical male fields of study, such as “Science, maths and com-
puting” and “Engineering, manufacturing and construction”.
2
European Commission (2018), Barcelona objectives, Justice and Consumers, Publications Office
of the European Union, Luxembourg, available at: https://ec.europa.eu/info/sites/info/files/bcn_
objectives-report2018_web_en.pdf.
In 2002, the heads of state and government agreed on two targets for children under mandatory
school age being in childcare (these are the Barcelona objectives): 33% of children under age of 3,
and 90% of children between 3-years old and mandatory school age.
See: https://www.consilium.europa.eu/uedocs/cms_data/docs/pressdata/en/ec/71025.pdf.
12 Cultural Profiles and Assertiveness of Women in Bulgarian … 211
Fig. 12.2 Share of part-time to total employment by gender, 20–64, per Member State, 2017q3
This index reflects the proportion of the employed population that would need to
change occupation/sector in order to bring about an even distribution of men and
women across occupations or sectors. The index varies between 0 (no segregation)
and 50 (complete segregation). For the EU as a whole, the figures are still high:
24.3% for occupational segregation and 18.9% for sectoral segregation.
3
2017 Report on equality between women and men in the EU, https://eeas.europa.eu/sites/eeas/
files/2017_report_equality_women_men_in_the_eu_en.pdf.
4
2017 Report on equality between women and men in the EU, https://eeas.europa.eu/sites/eeas/
files/2017_report_equality_women_men_in_the_eu_en.pdf.
12 Cultural Profiles and Assertiveness of Women in Bulgarian … 213
Progress in equality between women and men on the labour market is usually
gauged by means of aggregate indicators in three fields: in employment, in the
prevalence of atypical work such as part time and the pay gap. In 2016, Eurostat
updated data on the gender gap in earnings, which compiles inequalities resulting
from the gaps in pay, working hours and employment. This is therefore the most
comprehensive indicator of labour market inequalities between women and men. It
shows that the EU is still far from reaching gender equality on the labour market.
Even in the most equal countries, the overall gender gap in earnings stood at 20% or
so, while it reached 45% or even more in Germany, Greece, Malta, the Netherlands,
Austria and the UK.
The gap stood at 39.7% in 2014 in the EU, down from 41.2% in 2010.
Inequalities narrowed slightly at the beginning of the decade in most EU countries,
with the notable exception of Denmark, Estonia, Ireland, Latvia, Lithuania, Poland
and Slovenia. At this rate of change, it would take another century to close the
overall gender earnings gap.
5
International Labour Organization (2018), ILO database of labour statistics, Female share of
employment in senior and middle management.
6
2017 Inter-Parliamentary Union’s Women in National Parliaments Classification, International
labour Union, http://archive.ipu.org/wmn-e/classif.htm.
7
The Global Gender Gap Index was First introduced by the World Economic Forum in 2006
as a Framework for capturing the magnitude of Gender-based disparities and tracking their pro-
gress over time.
214 M. Baltov and D. S. Mladenova
Fig. 12.3 Change in the proportion of women on the boards of the largest publicly listed
companies in the EU, October 2010–October 2018 (percentage points)
The gender pay gap is the difference between average gross hourly earnings of male
and female paid employees, expressed as a percentage of the former.
With 15.4% gender gap Bulgaria is 0.9 pp below the EU-28 average of 16.3 for
2015. Thus, the average female employee earns 15.4% less than the average male
employee.
The overall gender earnings gap is a composite indicator. It measures the combined
impact on the average earnings of all working-age women (whether or not
employed), as compared with men, of: average hourly earnings; average number of
paid work per month (before any adjustment for part-time work); and employment
rate.
The overall gender gap in earnings in Bulgaria for 2016 is 22.8% and is thus
considerably smaller (16.9 pp) than on EU-28 average of 39.7%.
According to the data on the gender gap, the performance in Bulgaria is quite in the
“short” distance of this gap, well headed by the Northern countries in Europe, and
practically the best performing in South Europe and in Central and Eastern Europe
with only Slovenia ahead in this region. At the same time, the result shows that
216 M. Baltov and D. S. Mladenova
countries from Central America and Africa might be in this “short” version of the
gap too.
Progress towards economic independence is usually gauged by the employment
rate, but also by the number of paid working hours, which better reflects work
intensity. Men spent 39 h of paid work per week on average in the EU, whereas
women spend 33 h in paid work. In contrast, they do the lion’s share of housework
and care: Working women spend 22 h per week in unpaid work, while working
men spend fewer than 10 h. However, there are marked differences between
countries. The division of housework and care between women and men is more
equal in the Nordic countries, although parity has not yet been reached even there.
It is not only the important matter of the number of hours men and women spend
in paid and unpaid work that differs greatly, the type of tasks they do is very
different too. Women tend to perform more routine, labour-intensive and rigidly
scheduled tasks, in rapid alternation or even simultaneously. This is notably the
case when they enter motherhood, but also if they care for elderly or disabled
relatives. In the latter case, they tend to be more involved if care becomes more
intensive and regular: Among 18–64 year olds, 20% of women and 18% of men
were informal caregivers, of which 7% of women provided care on a daily basis
compared to 4% of men.
Paid and unpaid working hours, per sex, with countries ranked by the size of the
gap in unpaid working hours, rank Bulgaria on 22nd place in the EU-28. Women’s
unpaid work is 21 h per week, while men’s unpaid work is 7 h per week, hours
worked in main and second job—40 for women and 41 for men, with commuting
time hours per week 3 and 2, respectively (Eurofond 2015).
8
The Study is based on the Survey of Bulgarian managers (2014–2015)as per the GLOBE
Methodology and on culture distance (friction) measures for Bulgaria relative to 62 countries/
societal cultures.
12 Cultural Profiles and Assertiveness of Women in Bulgarian … 217
perceptual index was different and higher among women managers (4.51) than
among male managers (4.28).
On values-tied Gender Egalitarianism measures (values, “should be”) the
Bulgarian score was moderate (4.74) when compared to the average for 62 societies
(4.74), and when compared to the GLOBE rankings, Bulgaria scored on par with
Bolivia (22th), Mexico (23th) and Kazakhstan (24th). The gap in responses
between women and men was more visible (5.01 vs. 4.27) (Bobina and Sabotinova
2015).
Overall, the data on the perception of gender roles in Bulgarian business man-
agement revealed with the GLOBE research methodology reveals strong results on
Gender Egalitarianism and suggests that this phenomenon serves as the important
factor in business practices and in the economy at large. The study confirms the
advancements in the equality of the roles of women and men and is consistent with
the results of the other estimates by the international statistical authorities. It dis-
plays Bulgaria among the leading countries in terms of perception of the practices,
and among the top 50% of 62 societies who participated in the GLOBE research.
12.4 Assertiveness
Assertiveness has been the study of psychologists and communication scholars for
decades. In the field of communication, assertiveness falls within the study of
interpersonal communication and has been defined in interpersonal communication
as the kind of communication that happens when the people involved in talk and
listen in ways that maximize the presence of the personal. Assertiveness is seen by
other scholars as being a “skilful” form of interpersonal communication in which
participants are open to one another about their own feelings and perspectives and
respect those of the other.
Today, in the early years of the twenty-first century, the development of a culture
of assertiveness is especially important in light of the rampant sense of division and
violence in the Western culture. A culture composed largely of assertive people
would be an antidote to this often violent polarization because of the emphasis in
assertiveness on respect and equality for all people involved. It would especially
benefit our society to promote the practice of assertiveness among women, who are
still in many cases brought up to be supportive and polite rather than forthright and
assertive.
Assertiveness can be an effective interpersonal communication attitude meant to
promote equality in person to person relationship and to exercise personal rights
without denying the rights of others: a more optional communicative behaviour for
maintaining positive human relationships and resolving conflicts than is aggression
because it promotes harmony, ensures that all needs are met, and decreases the
sense of resentment that can build up when those needs are not met.
If assertiveness can bring so many benefits to our society, one might wonder
why it has taken so long for its practice to be universal—and why, in particular,
218 M. Baltov and D. S. Mladenova
professional women have such a difficult time expressing it. There are a lot of
challenges that professional women have traditionally experienced—and continue
to experience—in their efforts to be assertive in the workplace: Women are always
already at a disadvantage because workplaces have many unspoken rules of
behaviour, rules and communication norms that are fundamentally premised on
masculine ways of communicating and interacting in the world. As a result, women
are at a disadvantage because their communication strategies and expectations,
speech community and interaction styles are distinctly different from masculine
communication strategies and expectations (Kelly 2015).
Much of communication and leadership literature has focused on assertiveness in
professional women in particular because the directness and initiative, most often
associated with assertiveness, are often seen as counter to the social expectations
that women should be helpful, affectionate and nurturing. Because of the expec-
tations placed on them as both professional and female, women have often had to
choose when to be more assertive and when to use the softer traits, more often
associated with women.
Among other issues, the women have also experienced this need to decide when
to behave assertively—and when to conform to social expectations. What factors
drive these women to dare to act assertively—against the norms set out for them as
females? And how do these women become transformed by the very practice of
assertiveness when conforming to the expectations of others can be so much easier
and safer?
It would be vital for readers to understand the difference between assertiveness
and aggression. Alberti and Emmons (2012) describe aggression as a set of
behaviours in which the aggressor speaks his or her own mind in a way that hurts
the other person, and as one who controls others, makes choices for them and is
“self-enhancing at the expense of the other”. In contrast, they describe an assertive
person as one who does, indeed, voice his or her own opinion and possibly achieves
goals, but always with respect for the other person—allowing the other his or her
dignity. Women often identified aggression as a communication style and set of
behaviours that try to grasp power over the other person, and assertiveness as a way
to work with others to achieve a common goal.
In exploring how professional women value and practice assertiveness, the
assumption is that assertiveness is not a fixed communication pattern practised
uniformly by all people, but rather a continuum of traits and practices. These traits
and values range from respect for the rights of others, helping others to “save face”
and helping others to achieve their goals to standing up for one’s own rights and
expressing one’s emotions and opinions. These assertive traits range from concern
for the other to concern for oneself and for one’s organization. The traits of
assertiveness that are most valued by the women—and how these values relate to
the organization in which she works and to that organization’s core values.
12 Cultural Profiles and Assertiveness of Women in Bulgarian … 219
9
The Study is based on the Survey of Bulgarian managers (2014–2015) per the GLOBE
Methodology and on culture distance (friction) measures for Bulgaria relative to 62 countries/
societal cultures.
220 M. Baltov and D. S. Mladenova
12.6 Conclusion
10
http://www3.weforum.org/docs/WEF_GGGR_2018.pdf.
222 M. Baltov and D. S. Mladenova
in their organizations. Yet, perhaps unconsciously, our culture still expects them to
behave as the gentler, more supportive and more cooperative gender. Each woman
has a unique personality, and some might genuinely have those gentler, more
cooperative traits expected by our culture, while others might not. It is important
that women remain true to their nature while meeting both cultural and organiza-
tional expectations.
12 Cultural Profiles and Assertiveness of Women in Bulgarian … 223
Studies through the years have been consistent in showing that women’s com-
munication style is expected to be more polite, agreeable, compliant, cooperative
and other directed than that of men. The conflict that professional women face
between meeting social expectations of women and acting assertively and effec-
tively in their organizations, as well as the tendency of professional women to
choose when to be assertive and when to serve in a more traditional female sup-
portive role, has been confirmed. Women have identified aspects of assertiveness
that they find most effective and most favourable to the way they view their roles
and their own philosophies. They have emphasized such values as respect for
others; advocacy for their own values and for the needs of others; teamwork;
inclusion; honesty and integrity and effective, respectful communication.
Women have found themselves empowered and transformed—able to go beyond
the limits set for women by society and—perhaps more importantly—set by
themselves. In taking these bold and uncomfortable steps, they have discovered
their own inner strength and a flexibility that allows them to operate at an optimum
level in their professions: Playing the supportive role of listener and affirmer when
needed but, in other cases, asserting themselves and going beyond social expec-
tations when the situation calls for a bolder word or action. They—and so many
other women and men who may not have voiced their own acts of courage in
assertiveness—can help pave the way for a culture that celebrates true assertiveness
in all people as a way to maintain positive human relationships and resolve con-
flicts. In a world fraught with terrorism, greed, violence and hatred, this interper-
sonal development of true, respectful assertiveness offers a shining ray of hope.
References
Alberti, R., & Emmons, M. (2012). Your perfect right (9th ed.). Atascadero, CA: Impact
Publishers.
Baltov, M., & Baltova, S. (2014). Improving Managerial Capabilities of Expatriates in Bulgaria,
“Research Papers of IBS”, Botevgrad, Vol. 5, 2012–2013.
Bobina, M., & Sabotinova, D. (2017). Bulgarian management in a cross-cultural space. Journal of
East European Management Studies, 22(1), 105–127.
Bobina, M., & Sabotinova, D. (2015). The role of women in Bulgarian business: Cultural
perceptions. // Бизнec пocoки, БCУ, Бypгac, бp. 2, c. 106–109. Accessed March 15, 2017.
Eurofound. (2015). European working condition survey. https://www.eurofound.europa.eu/
surveys/european-working-conditions-surveys/sixth-european-working-conditions-survey-
2015. Accessed June 5, 2018.
Global Gender Gap Report. World Economic Forum. http://www3.weforum.org/docs/WEF_
GGGR_2018.pdf. Accessed May 25, 2019.
International Labor Organization. (2018). ILO database of labour statistics, Female share of
employment in senior and middle management.
Inter-Parliamentary Union’s Women in National Parliaments Classification. http://archive.ipu.org/
wmn-e/classif.htm. Accessed May 5, 2019.
224 M. Baltov and D. S. Mladenova
Professor Milen Baltov Ph.D. is himself an example of the transition from a business consultant
to the small and medium-sized enterprises (SMEs) and start-ups to an academic and Researcher in
the field. He is High Profile Expert in evaluation and monitoring of support schemes in variety of
technical assistance projects to the business, industry and infrastructure programmes. A Graduate
(1994) of the University of National and World Economy in Sofia, Bulgaria, he was the first in
CEE to draft and defend a Ph.D. dissertation (2000) on the topic of “Management Consulting for
SMEs”. For two decades, he was an expert and Team Leader in a capacity building and business
promotion projects in almost all the current CEE countries, with best impressions from his
missions in Macedonia, Croatia and Serbia. For the moment, Prof. Baltov is a Vice-Rector of the
Burgas Free University and a Programme Committee member for the “Innovations in SMEs and
Access to Risk Finance” filed of the EU Framework Programme for Scientific Research and
Innovations “Horizon 2020”. He is a member of the Black Sea Innovations and Research Agenda
working group member—initiative run by the “Maritime Research” unit at DG RTD of the EU
Commission. He is head of the Ph.D. programme in “Economics and Management in Industry”
and academic adviser of four Bulgarian, 2 Nepali, 1 Indian and 1 Pakistani Ph.D. students in
business issues. He is a member of the working group for financial engineering in the R&D
projects and Evaluator of the EU COST Programme project applications.
Diana Sabotinova Mladenova has graduated from English Language School—Burgas at 1987.
Her master degree is from University of National and World Economy—Sofia on Social-economic
planning at 1991. She had Ph.D. degree from Economic Institute of the Bulgarian Academy of
Science—Sofia, Section “Macroeconomics”. Her Ph.D. thesis title is “Macroeconomic
Consequences of Population Ageing”. She is working at Burgas Free University—Burgas since
2000.
Chapter 13
Investing in Women’s
Entrepreneurship: Inclusive
and Sustainable Economic Growth
Arzu Özyol
A. Özyol (&)
Ankara University, Ankara, Turkey
e-mail: [email protected]
trepreneurship support programs which are critical to strengthen the weakest links
in the chain and assure inclusive upgrading of quality and growths. This paper also
addresses how women’s entrepreneurship can be supported through international
networks.
The feminist movement in the USA is often described as taking place in three
waves. The ideals of feminism existed before the First Wave, but were organized
into an identifiable movement in the mid-1800s. African-American women were
fighting for women’s rights within the abolitionist movement prior to the First
Wave. And first nation American women embodied many of the ideals of the
feminist movement long before this time. The Women’s Rights Movement in the
USA began in the 1840s with suffragettes fighting for equality for women,
including the right to vote. After winning the right to vote, the movement took on
other challenges, such as access to birth control and the establishment of the
Women’s Bureau of Labor, which championed employment opportunities, and
lobbied for safety from workplace abuse and unsafe conditions. After World War II,
the return of soldiers to civilian life ushered the new era of the feminism. The
women, who took place in economic life to meet their daily requirements, returned
back home to gain the ground for men. It was the major reason to open discussions
on women in economy and patriarchal system.
The Second Wave of the feminist movement began in the 1960s and ended
approximately in the 1990s. As in the First Wave, feminism was intertwined with
the greater civil rights movement in the USA at the time. During this wave, women
identified their fight as being against patriarchy, the predominant social structure
where families and society are controlled by men and where rights, name, wealth,
and privilege are passed down through fathers, preventing equal opportunities for
women. Feminists in the 1970s and 1980s worked on increasing women’s legal and
workplace rights, such as fighting for legislation to protect women from workplace
sexual harassment. In the 1990s, there was a rise in theoretical orientations to define
the duality between gender and sexuality.
Feminists in the Third Wave consisted of women who had been raised with the
rights earlier generations of feminists had fought to achieve, such as the right to
vote, own property, and have credit cards and bank accounts. Much of the work of
the feminist movement has been to fight for equality in political, professional, and
domestic spheres. In the last two decades, the feminist movement has focusing on
creating gender equality in the workplace. Today, contribution of women to the
228 A. Özyol
labor market is not the issue of women activists entirely; it is the major compo-
nent of sustainable development as well (Kinser 2004; Byers and Crocker 2012;
Lorber 2010).
In many international human rights, instruments included “Convention on the
Elimination of All Forms of Discrimination Against Women,” gender equality is
accepted as an inalienable and integral part of human rights and fundamental
freedoms, and it is essential for to achieve sustainable development, peace, and
security as well. It is also important to emphasize that the concept of gender is not
only relating to women. Gender refers to both women and men and relations
between them. Since Beijing Conference in 1995, gender equity was used as a
terminology to provide a balance between women and men. gender equity denotes
an element of interpretation of social justice, usually based on tradition, custom,
religion, or culture. However, advancement of women is unacceptable by the term
of gender equity. During the Beijing Conference, it was agreed that the term
equality would be utilized. gender equality means that the rights, responsibilities,
and opportunities of individuals will not depend on whether they are born male or
female. Equality does not mean “the same as.” In other words, promotion of gender
equality does not mean that women and men will become the same. Equality
involves ensuring that the perceptions, interests, needs, roles, responsibilities, and
priorities of women and men will be given equal weight in planning and decision-
making. Women also have a critical role to play in all of the SDGs, with many
targets specifically recognizing women’s equality and empowerment as both the
objective and as part of the solution. Goal 5 is known as the stand-alone gender goal
because it is dedicated to achieving these ends (Ozyol and Çobanoglu 2016).
Recently, researchers have moved beyond simple differences between men and women.
They focus on other aspects of gender, such as gender role ideology and duality, to
better understand how multiple factors may shape outcomes related to entrepreneur-
ship. For example, stereotypical male characteristics such as aggressiveness, autonomy,
and courage are correlated with higher entrepreneurial intentions. In other words, both
genders identified entrepreneurs as having characteristics stereotypically associated
with men. A study across 17 countries found women tended to perceive themselves and
the entrepreneurial environment less favorably than men regardless of their motivation
to become an entrepreneur. Research has found that the degree to which a person
associates with traditional gender stereotypes mediates their satisfaction in their busi-
ness. Additionally, those of either gender who possess more stereotypically masculine
traits are more likely to find satisfaction through financial success, attaining status, and
higher growth of their business, while feminine characteristics are more likely to
seek work satisfaction through relationships and contribution. Moreover, individuals
with more feminine characteristics may not be high-growth-oriented entrepreneurs
(Gupta et al. 2009; Schoon and Duckworth 2012).
13 Investing in Women’s Entrepreneurship: Inclusive … 229
Small business performance have elucidated the key role that entrepreneurial
traits. One of such entrepreneurial trait that has received enormous interest in recent
years is entrepreneurial self-efficacy (ESE). ESE refers to an individual’s beliefs
regarding their capability in discovering and exploiting opportunities in the process
of starting and growing a business (Klyver and Thornton 2010). ESE is vital to the
performance of small businesses because the decisions and actions of a small
business owner directly influence the direction of the firm and consequently its
overall performance (Baum and Locke 2004; Markman, Baron and Balkin 2005).
Studies have found that entrepreneurial self-efficacy (ESE) was equal between
genders. When accounting for gender role ideology, ESE was higher for men than
women. Therefore, gender itself was not found to impact self-efficacy, but gender
role orientation was (Mueller and Conway Dato-on 2013; Carr and Sequeira 2007).
economic activity and the care of human beings, and therefore between economic
growth and human development. They are workers in both spheres-those most
responsible and therefore with most at stake, those who suffer most when two
spheres meet at cross-purposes, and those most sensitive to the need for better
integration between the two.” Although there were some changes in development
policies have been observed from 1970s to 2000s, it is easily said that Millennium
Development Goals (MDGs) are the milestones in the means of gender needs to be
understood clearly as a cross-cutting sociocultural variable. The Millennium
Declaration laid out a number of key development goals framed to reflect its
fundamental values. Along with the reduction of poverty and hunger, these inclu-
ded commitments to the promotion of human development and environmental
sustainability. Additionally, they included an explicit commitment to gender
equality as: No individual and no nation must be denied the opportunity to benefit
from development. The equality for the rights and opportunities of men and women
must be assured (Kabeer and Subrahmanian 1996; Hammer et al. 2004).
There are two approaches that should be used to apply gender mainstreaming
into the public policies:
– Women in Development Approach (WiD)
In the framework of Women in Development Approach, women are considered
as a distinct and vulnerable group in projects and programs. Where women’s
knowledge has been utilized in areas related to family or community health (en-
suring medical plans and food security) and environmental conservation (the pro-
tection of forest products). This approach ignores the required strategies needed to
pursue the various objectives involved in the use and management of environmental
resources that will require the contributions of women and men alike. This approach
first came to prominence in the early 1970s. Research and information collected
throughout the UN Decade for Women (1975–85) highlighted the existing poverty
and disadvantage of women and their invisibility in the development process.
Different policy responses and interventions focused on women as a separate group
resulting in women’s concerns being “added on” and peripheral to mainstream
development efforts. WiD policies have proposed actions targeted only to women
rather than integrating them fully into the project activities. WiD policies and
interventions have concentrated on women’s productive work. The failure to make
an explicit link to women’s reproductive work has often added to women’s
workload. Gradually, it was recognized that an approach that focused on women in
isolation, was inadequate and not sustainable. Because it did not take into account
the overall project objectives or integrate women fully into their implementation.
Moreover, it did not address or change unequal gender relations in various social
and economic settings. However, there are shortcomings to this approach because
by WID, women are not available in the use and management all kind of resources.
Many policy makers tend to follow WiD approach to development discourses and
programs. Although the WiD approach may be successful when implementing
13 Investing in Women’s Entrepreneurship: Inclusive … 231
Table 13.1 Differences of Women in Development (WiD) and Gender and Development (GaD)
Description Women in development Gender and development
Approach An approach that views women as the An approach to development
problem
Focus – Women – Relations between men and women
problem – The exclusion of women (half of the – Unequal relations of power (rich and
productive resources) from the poor, women and men) that prevent
development process equitable development and
participation
Goal More efficient, effective development Equitable, sustainable development
with both women and men as decision-
makers
Solution Integrate women into the development Empower the disadvantaged women;
process transform unequal relations
Strategies – Women’s projects – Identify/address practical needs
– Women’s components determined by women and men to
– Integrated projects improve their condition
– Increase women’s productivity – Address women’s strategic interests
– Increase women’s income – Address strategic interests of the poor
– Increase women’s ability to look through people-centered development
after the households
Source Dayal et al. (1993)
232 A. Özyol
Hochschild and Machung, men have not tended to take on a proportionate share of
caregiving and domestic duties, leaving women working outside the home during
the day and handling domestic responsibilities on evenings and weekends, dubbed
the “second shift.” Disproportionate burden on the shoulders of women has
impacted women’s ability to compete and succeed in the workforce and may impact
a woman entrepreneur’s business growth. Women are often expected to make work
compromises for children and husband’s career in a way that men are not (Mattis
2004; Rudman and Mescher 2013; Maume 2006). However, firms run by women
are also usually smaller than those operated by men in terms of number of em-
ployees, asset value, and annual turnover, besides being less profitable and pro-
ductive, probably due to other constraints such as difficulties obtaining financing.
A study that looked at 34 countries in developed and developing economies in
Europe and Asia found that female-owned firms had also fewer employees overall
than male-owned firms. In the USA, women account for 35% of entrepreneurial
activity. Only 20% of women-owned firms had over US $100,000 annual revenue,
compared to 33% of men-owned firms—a significant difference (Kelley et al. 2013;
Minniti and Arenius 2003; Noor 2004).
Women own only 1% of the world’s wealth, earn only a 10% share of global
income, and occupy just 14% of leadership positions in the private and public
sector. And, while women produce half of the world’s food, they own a mere 1% of
its land. Due to the chilly climate to the glass ceiling, gender may constrict a
women’s ability to advance or to be taken seriously in her career. Although
women’s entrepreneurship has been accepted as an alternative path for women who
seek greater autonomy and/or income, there is still a significant gender gap in the
entrepreneurial activity rate across the world (Verheul and Thurik 2001;
Nedelcheva 2012). A Global Entrepreneurship Monitor study of 18 economies from
2002 to 2010 suggests that women’s entrepreneurial activity is lower than that of
their male counterparts at different stages of development (Kelley et al 2013; Datta
and Gailey 2012).
Countries with high total entrepreneurial activity rates are also associated with
high female entrepreneurial activity rates. In 2015, Global Entrepreneurship
Development Institute published the Female Entrepreneurship Index report that
analyzed conditions for fostering women entrepreneurship in 77 countries. As per
the report, the top ten countries for female entrepreneurs in 2015 were: USA,
Australia, UK, Denmark, Netherlands, France, Iceland, Sweden, Finland, and
Norway. In less developed countries with the high female unemployment rate,
entrepreneurship can be a practical solution to earn income for some women who
need to work at home in order to handle their domestic responsibilities at the same
time (Baugh et al. 2006; Sarfaraz et al. 2013).
There are also regional differences in terms of the female participation rate in
ownership. The following figure indicates the regional differences in terms of firm
ownership, in management and as workers.
Women in developed countries enjoy more equal opportunities than women in
developing countries. On the other hand, as the economies move to a higher level of
development, the rate of entrepreneurial activity decreases, regardless of gender.
234 A. Özyol
Because in more developed economies that both men and women have different
options for employment, individuals seem to be more interested in having secured
jobs rather than starting their own businesses. However, in general, the entrepre-
neurial gap between women and men decreases with economic development level.
In other words, as the economies move from factor-driven stage to efficiency-driven
stage and to innovation-driven stage, the gap between men and women entrepre-
neurs decreases from 5.2% points (lower for women) to 4 points and to 3.4,
respectively.
Access to finance is a major constraint for women entrepreneurs. In developing
countries especially, it is difficult to conduct a thorough analysis of whether a
female entrepreneur faces discrimination when applying or obtaining a loan. But a
study using 2005 data from 34 countries of Western Europe, Eastern Europe, and
Central Asia, and East Asia and the Pacific confirmed this hypothesis that women-
owned or managed firms are more constrained than men’s firms. There were dif-
ferent results depending on the development level of countries. As expected, the
probability of women obtaining loans was higher in more developed countries, and
women had to give less collateral on average. The differences in financing between
male and female entrepreneurs might come from a demand side component. In
other words, female entrepreneurs might demand less financing than men as a result
of less personal wealth to use as collateral, more risk aversion than men to apply for
loans, or self-doubt given the low probability of obtaining loans, based on past
experience. Nevertheless, gender financing discrimination from the supply side
might not be only a matter of perception (Bruni et al. 2004; Landstrom and Lohrke
2010).
Globally, women-owned businesses are well represented in the entrepreneurship
space; yet it is estimated that they only access between 2 and 10% of commercial
bank finance. This holds true in emerging markets, where women-owned firms
represent 31–38% of all small and medium enterprises (SMEs), but have unmet
financial needs close to $300 billion every year. Serving this market not only makes
business sense, it is also known to have positive development impacts for society as
a whole by expanding economic growth and job creation (Schoon and Duckworth
2012; Eddleston et al. 2006).
Another striking research results from a new World Bank Group—housed
project funded by the Bill & Melinda Gates Foundation which is measuring how
people in 148 countries—including the poor, women, and rural residents—save,
borrow, make payments, and manage risk. This is the first time cross-country
comparable data which have been available. It confirms that women have a lower
formal account penetration in every region, with the lowest rates reported in the
Middle East and North Africa, and Sub-Saharan Africa, and the widest gaps in
lower middle-income economies as well as in South Asia and the Middle East and
North Africa. Moreover, unbanked women in developing countries are far more
than men. It is important to recognize that the entrepreneur wage gap is 50 cents to
every $1 of male earnings in Sri Lanka, and in Bangladesh women entrepreneurs
make 12 cents per $1 men earn (The World Bank 2018).
13 Investing in Women’s Entrepreneurship: Inclusive … 235
Women entrepreneurs spend less time for networking. Nevertheless, some studies
on women running technology-based businesses demonstrate that they face a “triple
bind:” the lack of personal financial capital, the lack of experience (human capital),
and the lack of networks (social capital) to attract external capital (Verheul and
Thurik 2001).
The international, or global women’s movement can be derived from the
national organizations that came together around the 1975 declaration of the
Decade of Women by the United Nations and its for international conferences—
Mexico City (1975), Copenhagen (1980), Nairobi (1985), and Beijing (1995).
These conferences were the first to bring together women from developed and
developing countries, creating common interests and strategies for action the world
over. A successful sustainable development agenda requires partnerships between
governments, the private sector and civil society (Goal 17: Revitalize the global
partnership for sustainable development). These inclusive partnerships built upon
principles and values, a shared vision, and shared goals that place people and the
planet at the center, are needed at the global, regional, national, and local level
(Shelton 2006; Langowitz and Minniti 2007).
13 Investing in Women’s Entrepreneurship: Inclusive … 237
Collective action through social networks and civil society groups has been a
formidable force in advancing gender equality. Policy reforms arise from a political
process where state and non-state societal actors vie to shape their environment.
policies require trade-offs in allocating resources to competing priorities within
budget constraints and financial and political costs. Societal actors have a direct
hand in shaping the policies by advocating policies, designing interventions and
implementing programs. Thus, over the past 25 years, supranational organizations,
women’s rights groups, political parties, trade unions, state-sponsored mass orga-
nizations, and civil society groups have direct hands in shaping the policy and
institutional environment through advocating policies, designing interventions and
implementing programs, thus strengthening the situation of women in the economy
in the form of employment and/or entrepreneurship. Thus, the following part is
allocated to highlight the roles of such kind of organizations for women‘s en-
trepreneurship through networks and partnerships.
Today, there are many UN agencies are working on gender equality from dif-
ferent perspectives. UN Women is the global champion for gender equality,
working to develop and uphold standards, and create an environment in which
every woman and girl can exercise her human rights and live up to her full
potential. In response to the UN General Assembly Resolution 63/311, in January
2006 the Secretary-General presented the report A/64/588, entitled Comprehensive
Proposal for the Composite Entity for Gender Equality and the Empowerment of
Women. In his report, the Secretary-General resolved that, rather than relieving
other parts of the United Nations system of their responsibility for contributing to
the promotion of gender equality and women’s empowerment, the new entity
should seek to sharpen the focus and impact of the gender equality activities of the
entire United Nations System. Additionally, Secretary-General Ban Ki-moon esti-
mated that approximately $125 million per annum were needed for operating costs
and “start-up” capacity at the country, regional, and headquarters levels. Moreover,
an additional $375 million per annum were needed in the initial phase to respond to
country level requests for programmatic support (Gill and Ganesh 2007;
Nedelcheva 2012).
After years of negotiations between UN member states, women’s groups, and
civil society, on July 2, 2010, the General Assembly unanimously adopted the
resolution 64/289, thus creating UN Women by merging the Division for the
Advancement of Women (DAW); the International Research and Training Institute
for the Advancement of Women (INSTRAW, established in 1976); the Office of the
Special Adviser on Gender Issues and Advancement of Women (OSAGI, estab-
lished in 1997), and the United Nations Development Fund for Women (UNIFEM,
established in 1976).
UN Women, the UN Global Compact (business and other stakeholders) in more
than 160 countries, and other leading UN agencies, the World Bank and the World
Economic Forum, reinforce the findings. Governments also recognize that women’s
inclusion drives development, and acknowledge that achieving the Sustainable
Development Goals and national economic and development plans require rapidly
moving toward gender equality (United Nations 2018).
238 A. Özyol
with respect to promoting more inclusive workplaces, and ensuring that policies,
programs and institutions are gender responsive. Additionally, the Women’s
Entrepreneurship Development (ILO-WED) program has been empowering women
entrepreneurs in developing countries and supporting them in starting and growing
their businesses since the mid-2000s. The program works with service providers
promoting entrepreneurship development (financial, non-financial, public, private,
associative, freelance, etc.) and builds their capacity to better support women
entrepreneurs to start and grow their businesses. It also works toward creating a
more positive enabling environment for WED, by supporting assessments of the
situation, and working with governments and policy makers to remove the specific
gender barriers that women entrepreneurs may face (ILO 2018).
United Nations Industrial Development Agency (UNIDO) is the specialized
agency of the United Nations that promotes industrial development for poverty
reduction, inclusive globalization, and environmental sustainability. UNIDO also
collaborates with partners across the UN system, the private sector and at the
country level to advance gender equality and women’s economic empowerment.
Through these partnerships, UNIDO provides technical cooperation activities
within its three thematic areas. By encouraging investment in women-owned
businesses, strengthening female networks, improving access to markets and pro-
viding training, technology and clean energy solutions for inclusive and sustainable
industrial development, UNIDO is helping to create a world where women can
thrive. As well as empowering women through targeted technical cooperation ac-
tivities, UNIDO mainstreams gender in all programs, projects and organizational
practices. UNIDO’s Policy on Gender Equality and the Empowerment of Women,
issued in 2009 and updated in 2015, sets out the Organization’s gender equality
commitments. The Gender Equality and Empowerment of Women Strategy 2016–
2019 provides a clear result-oriented framework and plan of action (United Nations
Industrial Development Organization 2018).
United Nations Conference on Trade and Development (UNCTAD) support
developing countries to access the benefits of a globalized economy more fairly and
effectively. And we help equip them to deal with the potential drawbacks of greater
economic integration. To do this, we provide analysis, consensus building, and
technical assistance. This helps them to use trade, investment, finance, and tech-
nology as vehicles for inclusive and sustainable development. The ultimate gender-
based objective of the UNIDO is to make trade instrumental to the achievement of
gender equality and women’s economic empowerment, as a means to ensure
inclusive development (United Nations Conference on Trade and Development
2018).
In 1945, UNESCO was created in order to respond to the firm belief of nations,
forged by two world wars in less than a generation that political and economic
agreements are not enough to build a lasting peace. Peace must be established on
the basis of humanity’s moral and intellectual solidarity. UNESCO strives to build
networks among nations that enable this kind of solidarity, by mobilizing for ed-
ucation: so that every child, boy or girl, has access to quality education as a
fundamental human right and as a prerequisite for human development, building
240 A. Özyol
past five years. In response, we are working with clients to reduce the gap between
men and women as entrepreneurs, employees, corporate leaders, suppliers, con-
sumers, and community stakeholders (World Bank 2012; International Finance
Cooperation 2018).
In June 2003, the LEED Directing Committee agreed to launch this study as part
of the OECD efforts to integrate a gender perspective into the substantive work of
the organization. The aim of this project is to examine the role of female en-
trepreneurship in the dynamics of local development and to give an overall review
of the current situation of women entrepreneurs in a given territory. These studies
will result in the elaboration of recommendations for policy makers to help them to
implement tools adapted to the real needs of women entrepreneurs in the formu-
lation of local development strategies and business creation policies (OECD
2018b).
Through the Global Gender Gap Report, the World Economic Forum quantifies
the magnitude of gender disparities and tracks their progress over time, with a
specific focus on the relative gaps between women and men across four key areas:
health, education, economy, and politics. The aim of the Global Gender Gap Report
is to focus on whether the gap between women and men in the chosen indicators
has declined, rather than whether women are winning the so-called battle of the
sexes. Hence, the Index rewards countries that reach the point where outcomes for
women equal those for men, but it neither rewards nor penalizes cases in which
women are outperforming men on particular indicators in some countries (https://
www.weforum.org/reports/the-global-gender-gap-report-2017).
13.5 Conclusion
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Arzu Özyol graduated from Middle East Technical University in 1983 and received MBA degree
from İstanbul Bilgi University in 2002. In May 2013, she completed her PHD study on Bioethic
Environmental Politics. During the studies of her PhD, she got two courses on Global Energy and
Environmental Politics an Environmental Politics from Harvard University in 2009–2010. From
1983 to 2002, Arzu Özyol worked in Construction Company as an Environmental Engineer. She
has established her own company HYDRA Project and Consulting Company in 2003. The major
speciality of her company is developing and managing projects for EU funds besides providing
training programs for public and private institutions and technical, administrative, and financial
follow-up services for ongoing projects. She is working actively for BPW since 2006. She founded
the first BPW Club in Ankara-Turkey with twenty members. In 2010, the national federation was
established with 100 members. She has attended all CSW Meetings since 2006 and taken
influential roles during the BPW Leadership Summits and Annual WEPs Meetings held in New
York. Since the launch of the Women’s Empowerment Principles: Equality Means Business,
BPW-Turkey have completed four EU-funded projects and realized four high-level international
events in the framework of WEPs under her coordination. Additionally, she arranged for the
official UN WEPs booklet to be translated in Turkish and organized a side event on “Women in
Green Businesses” by teamwork in Rio+20 (United Nations Conference on Sustainable
Development). She was the UN Representative of BPW International in the past two years. She
also represents BPW International in the Global Platform for Action on Sourcing from Women
Vendors, B-MENA initiative (Broader Initiative for Civil Society in North Africa and Middle East)
of the US Department of Government that was started by the ex-Minister of the US Department of
State, Hillary Clinton. Additionally, Arzu Özyol is the member of the board of the UNESCO
Center for Women and Peace in Balkan Countries and coordinator of South Eastern Europe
Leadership Center for Women in Business which was established by the cooperation of BPW
International and UNESCO Center in 2011. She was elected as Vice President United Nation in
the last BPW International Congress that was realized in Jeju Island, South Korea, on May 2014.
In August 2014, she established UNESCO Center for Global Ethics and Sustainable Development
in İstanbul.
Chapter 14
The Relationship Between Sustainable
Economic Development and Tourism
in Turkey: Panel Data Analysis
Dilek Tandoğan
14.1 Introduction
D. Tandoğan (&)
Karadeniz Technical University, Trabzon, Turkey
e-mail: [email protected]
tainable growth where regional disparities are eliminated and poverty is reduced. In
the meanwhile from this date until today, the understanding of sustainable eco-
nomic development has been developed by meetings and agreements1 made and
has taken its place among noticeable topics in the world.
Factors of sustainable economic development are examined in three aspects as
economical, social and environmental. Tourism is one of the sectors that is affected
by these three factors and affects them at the same time, as the sustainability of
environmental quality reveals direct relationship with tourism activities. Untainted
environmental quality and factors related to it consequently (preserved cultural and
social structure, climatic and vegetal diversity) are among the main factors making a
place to visit attractive. Accordingly, effects created by tourism activities cause
economical and social outcomes.
When global sustainable development goals and their reasons are examined, as
tourism sector being an entrepreneurial alternative and causing a decrease in pov-
erty by providing income and employment to all societies regardless of developed
or underdeveloped and environmenal values can be considered as touristic attrac-
tiveness, it can be described as solution creator and contribution-maker in terms of
increasing the importance given to environmental values in terrestrial ecosystem.
One of the most important principles of tourism’s contribution in global
sustainable development is the size of employment that is created in a global sense.
Moreover, when considering nature and dynamics of tourism sector, it is known
that tourism is a sector considering and prioritizing women employment especially
in particular departments (Ar and Çelik Uğuz 2017: 526, 529–530).
Income produced by tourism sector affects development of other sectors carrying
out economic activities either directly or indirectly. Economic activities planned to
meet the increasing demand increase the labour demand depending on new job
opportunities and support employment. The progress occured in tourism sector in
the recent years caused inter-regional income disparities taking the first place in
significant economic issues in developing countries such as Turkey to reduce and
thus, the sector to distinguish in efforts to increase employment. In other words,
each region considers its distinctive tourism potential as an investment tool in
reaching low-cost external source and as an important source in financing to support
employment. However, tourism carrying out activities in service sector contributes
to women employment which is more advantageous both in total employment and
service sector.
In addition, elimination of development disparities on regional basis is tried to be
ensured with the plans done both on national and regional scale. In this respect,
tourism is used as an important political tool in the elimination inter-regional
development disparities. European Union defines tourism as a social factor that
makes reducing regional disparities easier (Baykul and Maden 2017: 66). Among
the structural funds approved by European Union, the increase in number of the
ones involving tourism reveals the relationship between tourism and regional
For detailed information, see Barbier (1987), Kruja (2013), Çalık (2014) and Aksu (2011).
1
14 The Relationship Between Sustainable Economic Development … 251
2
For detailed information, see Mirsanjari (2012).
252 D. Tandoğan
3
26 Subregions: TR10; İstanbul, TR21; Tekirdağ, Edirne, Kırklareli, TR22; Balıkesir, Çanakkale,
TR31; İzmir, TR32; Aydın, Denizli, Muğla, TR33; Manisa, Afyon, Kütahya, Uşak, TR41; Bursa,
Eskişehir, Bilecik, TR42; Kocaeli, Sakarya, Düzce, Bolu, Yalova, TR51; Ankara, TR52; Konya,
Karaman, TR61; Antalya, Isparta, Burdur, TR62; Adana, Mersin, TR63; Hatay, Kahramanmaraş,
Osmaniye, TR71; Kırıkkale, Aksaray, Niğde, Nevşehir, Kırşehir, TR72; Kayseri, Sivas, Yozgat,
TR81; Zonguldak, Karabük, Bartın, TR82; Kastamonu, Çankırı, Sinop, TR83; Samsun, Tokat,
Çorum, Amasya, TR90; Trabzon, Ordu, Giresun, Rize, Artvin, Gümüşhane, TRA1; Erzurum,
Erzincan, Bayburt, TRA2; Ağrı, Kars, Iğdır, Ardahan, TRB1; Malatya, Elazığ, Bingöl, Tunceli,
14 The Relationship Between Sustainable Economic Development … 253
Fig. 14.1 Number of tourists arrived in Turkey in 2004 and 2017 on subregions basis
As seen in Fig. 14.1, TR61 region is the region which attracted tourists the most
with approximately 8.954 million and 15.852 million tourists in 2004 and 2017,
respectively. Similarly, TR10 (4.485 million and 10.747 million people) and TR32
(5.074 and 5.715 million people) subregions are the second and third subregions,
respectively, that attracted tourists the most. In other saying, the fact that these three
subregions which take place in Turkey’s west composing 52% of total number of
tourists arriving in Turkey reveals the big share that these three subregions have in
tourism.
Figure 14.2 shows the number of people employed in 2004 and 2017 on
subregions basis.
As seen in Fig. 14.2, TR10 subregion is the region where the employment is the
highest in Turkey with 3.521 million people in 2004 and 5.664 million people in
2017. TR51 subregion is in the second place with the employment of 1.155 million
people in 2004 and 1.960 million people in 2017. TR90 takes the third place with
the employment of 1.096 million people in 2004 while TR31 takes the third place
with the employment of 1.611 million people in 2017. When the data in question
are examined, it is seen that other regions except for TR90 subregion take place in
the west of Turkey.
Figure 14.3 shows the number of women employment in Turkey in 2004 and
2017 on subregions basis.
As seen in Graph 3, TR10 subregion is the region where women employment is
the highest in Turkey with 737 thousand people in 2014 and 1.776 million people
in 2017. In the year of 2004, TR90 region is in the second place with 476 thousand
people while TR83 is in the third place with 392 thousand people. It is seen that
TRB2; Van, Muş, Bitlis, Hakkari, TRC1; Gaziantep, Adıyaman, Kilis, TRC2; Şanlıurfa,
Diyarbakır, TRC3; Mardin, Batman, Şırnak, Siirt.
254 D. Tandoğan
Fig. 14.2 Total employment in Turkey in 2004 and 2017 on subregions basis
Fig. 14.3 Women employment in Turkey in 2004 and 2017 on subregions basis
TR51 and TR31 subregions rank the second and third with 592 thousand people
and 524 thousand people, respectively. It is determined that TR90 and TR83
subregions taking place in eastern Turkey lost their position of being the second and
third in 2004 to the regions taking place in western Turkey in 2017.
In the studies done to determine tourists’ purposes of travel, it is seen that the
number of travels with environment, culture, education, entertainment, health,
business and shopping purposes increased along with sea, sand and sun tourism.
Thus, it is seen that Turkey has the diversity to meet all these needs considering
Turkey and its regional sources as a whole. In the policies carried out to decrease
inter-regional development differences, tourism’s contribution to regional
employment can be achieved by planning in line with the set goal. Also, the impact
14 The Relationship Between Sustainable Economic Development … 255
14.3 Literature
When studies taking place in literature are examined, it is detected that tourism’s
contribution to employment is examined by both econometric methods and
graphical methods based on the analysis of changes in values of variables over time
or input–output analysis method. Accordingly, studies in question taking place in
relevant literature are examined and presented as a summary in this part of the
study. As a result of examining the studies in the literature, it is determined that the
relationship between tourism and employment in Turkey was not examined on
subregions basis. Therefore, the fact that this study will fill the gap in the literature
suggests the importance of it. When the studies researching the relationship
between tourism and employment are examined via econometric methods, it is
determined that Pavlic et al. (2013) researched the relationship between tourism and
employment through Johansen cointegration and Granger causality tests with
quarterly data for 2000–2012 period. Findings revealed the long-term relationship
between tourism and employment. In addition, a unidirectional causality relation-
ship from tourism towards employment was detected. Dimoska (2016) estimated
tourism’s impact on employment for 2002–2015 period over linear regression
model. Dependent variable was indicated by total employment and total employ-
ment in food and beverage services while independent variable was indicated by the
number of tourists arriving. Results acquired from both models showed that tourism
affected total employment and total employment in food and beverage services
positively. Similarly, Fauzel (2016) researched the relationship between tourism
sector and employment in Mauritius for 1988–2014 period through VECM and
Granger causality tests. Results revealed that tourism supported employment both
in long and short term. Also, the results of Granger causality test detected a uni-
directional causality relationship from tourism towards employment. Önder and
Durgun (2008) researched the relationship between tourism and employment in
Turkey for 1980–2007 period via Johansen cointegration and Engle–Granger
causality test. According to the findings acquired, there was a long-term
256 D. Tandoğan
X
k X
k
Yit ¼/0t þ /lt Yitl þ blt Xitl þ fi þ xit i ¼ 1. . .N; t ¼ 1. . .T ð14:1Þ
l¼1 l¼1
X
k X
k
DYit ¼ /l DYitl þ bl DXitl þ Dxit ð14:2Þ
l¼1 l¼1
In Eqs. (14.1) and (14.2), i, t, fi and Δ represent cross-sectional units, time, fixed
effects and differences of variables, respectively. Equation (14.2) is acquired by
taking the difference between variables to remove fixed effects taking place in
Eq. (14.1). In the equation where the difference is taken, there is a need for the use
of instrumental variables in the estimation of equation, as ΔYit−1 is related to Δ⍵it.
In the method developed by Arellano and Bond (1991), the use of lagged values of
independent variables as instrumental variables is allowed through generalised
method of moment (GMM) estimation. It is determined whether there is a causality
relationship from independent variable towards dependent variable by applying
Wald test to the coefficients of independent variables. In addition, validity of
instrumental variables is tested through Sargan test. According to this, H0 null
hypothesis is done as instrumental variables not related to error terms while
alternative hypothesis is done as instrumental variables related to error terms. When
determining the causality relationship in Wald test, testing is done in a way that
there is a causality relationship from independent variable towards dependent
4
Turkey is classified as Regional Level 1 (12 regions), Regional Level 2 (26 subregions) and
Regional Level 3 (81 provinces) according to the classification of NUTS.
258 D. Tandoğan
Table 14.1 Variables used in panel data analysis and their definitions
Name of variable Definition Source
Tourism; total number Number of arrival and overnights in Turkish
of tourist arrivals (LT) accommodation facilities with municipal certificate: Statistical
number of arrivals in facility/total and number of Institute
arrivals and overnights in accommodation facilities Regional
with Tourism establishment certificate: number of statistics
arrivals in facility/total
Rate of total Labour force status of non-institutional population
employment (LRTE) (aged 15+): employment rate (%)
Total employment Labour force status of non-institutional population
(LTE) [aged 15+]: employment (1000)
Rate of total women Employment rate based on age groups (aged 15 and
employment (LRTWE) above—%): total/women
Total women Employment based on age groups (aged 15 and
employment (LTWE) above—a thousand people): total/women
Table 14.2 Levin, Lin and Chu unit root test results
Variables Level Difference
Fixed Fixed-trended Fixed Fixed-trended
LT −7.79544a −8.62349a −17.7179a −14.6297a
LRTE −3.87599 a
−5.01088 a
−12.6638 a
−11.6203a
LTE −1.31285b −4.85577a −12.9643a −11.4604a
LRTWE −4.10163 a
−7.05344 a
−12.1961 a
−11.8478a
LTWE −2.62830 a
−6.33493 a
−12.9343 a
−11.8873a
Note Optimal lag length is determined according to Akaike Info Criterion (AIC)
a,b
Respectively indicate significance at the level of 1 and 10% statistically
14 The Relationship Between Sustainable Economic Development … 259
When Table 14.3 is examined, Wald test statistics in the model where dependent
variable is DLTE revealed that there is a causality relationship from DLT-
independent variable towards DLTE by rejecting H0 at the significance level of 5%
statistically. However, when results of the model where DLT-dependent variable
are analysed, Wald test statistics showed that there is no causality relationship from
DLTE towards DLT by not rejecting H0. Therefore, it is determined that there is a
unidirectional relationship from DLT towards DLTE.
Similarly, Wald test statistics in the model where DLRTE is the dependent
variable revealed a causality relationship from DLT towards DLRTE by rejecting
H0 at the significance level of 10% statistically. When Wald test statistics are
examined in the model where DLT is the dependent variable, it is determined that
there is no causality relationship from DLRTE towards DLT by not rejecting H0.
As a consequence, a unidirectional causality relationship from DLT towards
DLRTE is detected. Also, Sargan test results revealed the validity of instrumental
variables.
Results of Holtz-Eakin et al. (1988) panel causality testing used to research the
relationship between total women employment and rate of total women employ-
ment and tourism in Turkey on subregions basis can be seen in Table 13.4.
When the data taking place in Table 13.4 are examined, Wald test statistics in
the model where dependent variable is DLTWE revealed a causality relationship
from DLT-independent variable to DLTWE by rejecting H0 at the significance level
260 D. Tandoğan
Table 14.4 Panel causality test result of total women employment models
Independent Dependent variable Independent Dependent variable
variable DLTWE DLT variable DLRTWE DLT
DLTWE(-1) 0.642172a 0.006966 DLRTWE(- 0.766692a 0.178400b
(0.145876) (0.052209) 1) (0.087479) (0.105682)
DLTWE(-2) −0.143788a −0.107471a DLRTWE(- −0.090161a −0.100582a
(0.016669) (0.028624) 2) (0.027519) (0.034624)
DLT(-1) 0.287597a 1.114290a DLT(-1) 0.087875 0.955786a
(0.049644) (0.094930) (0.064310) (0.071748)
DLT(-2) 0.037186 0.019671 DLT(-2) −0.021642 −0.015808
(0.060217) (0.101365) (0.040035) (0.099885)
H0 DLTWEi = 0, DLTEi = 0, H0 DLRTWEi = 0, DLTEi = 0,
i = 1, 2, 3 i = 1, 2, 3 i = 1, 2, 3 i = 1, 2, 3
Wald test 36.45416a 27.21182a Wald test 2.501951 16.07345a
v2 statistics v2 statistics
Result DLTWE $ DLT Result DLRTWE ! DLT
Sargan test 0.560106 0.413072 Sargan test 0.429192 0.466199
P-value P-value
a,b
Indicate significance at the level of 1 and 10%, respectively, while parenthetical values indicate
the standard deviation value
Fixed, LTWEit−l, LRTWEit−l and LTt−l, l = 2 … 5 are used as instrumental variables in GMM
estimation. $ shows a bidirectional causality relationship between variables while ! shows a
unidirectional causality
Turkey’s western regions being more advanced than eastern regions causes various
problems like economic and social ones. In a more explicit saying, problems such
as unemployment, immigration, unplanned urbanisation, inadequate education and
access to health services, income inequalities per capita, etc. underlie economical
and social problems. Furthermore, the concept of sustainable economic
14 The Relationship Between Sustainable Economic Development … 261
development supports policies that make reaching equal rights easier both for
today’s generation and the next generations by pioneering in planning activities that
can be done to eliminate economic and social inequality. Therefore, policies to be
applied to reduce differences of regional inequalities will support the reduction of
socio-economic development differences. From this point of view, tourism will take
an important role in reducing the differences in subject by causing each region to
become a centre of attraction preferred by tourists in a way to move ahead of its
components with its distinctive features.
An increase in tourist arrivals in the region will increase region’s income
depending on expenditure of tourists. Thus, investments to meet tourists’ demands
will create new job opportunities. Accordingly, development of tourism having
activities in service sector in the regions which have limited job opportunities will
increase the need and demand for human resources and support employment by
boosting new job opportunities. For this purpose, relationships between employ-
ment and tourism in Turkey for 2004–2017 period are examined on 26 subregions
basis in the study. Causality relationships between total employment, rate of total
employment, women employment and rate of total women employment and the
number of tourists arriving are researched through panel causality testing.
According to the findings acquired, there is a unidirectional causality relationship
detected from employment towards tourism and a bidirectional causality relation-
ship between the rate of total employment and tourism. Moreover, there is a
bidirectional causality relationship determined between total women employment
and tourism while there is a unidirectional causality relationship determined from
the rate of total women employment towards tourism. To evaluate all the results as a
whole, it can be said that the bidirectional causality relationship between tourism
and employment shows that there is a feedback relationship between the variables.
Tourism contributes to employment as it is a labour-intensive sector. Also,
development of tourism contributes to all the economy directly and indirectly. Its
feature supporting women employment which is disadvantageous especially in
employment contributes to social gender equality and the principle of equal rights
in economic development. Accordingly, it seems like increasing touristic activities
in eastern regions will play an important role in eliminating inter-regional
inequalities. However, rate of employment being higher in western regions than
eastern regions requires people looking for jobs to immigrate to these regions. Thus,
highlighting attractive features of touristic regions and distinctive features of each
region attracting tourists to those regions will contribute to employment supported
by tourism on regional basis. Turkey should speed up the investments in regional
tourism applications among its efforts to reduce regional development differences
and regional employment differences by using available sources effectively.
262 D. Tandoğan
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Dilek Tandoğan was born in Germany in 1977; she completed her primary, secondary and high
school education in Trabzon. She started her studies at the Black Sea Technical University, Faculty
of Economics and Administrative Sciences, Department of Economics. In 2006, she started as
Lecturer at the Black Sea Technical University, Vakfıkebir Vocational School, Department of
Banking and Insurance. She completed her master’s degree in the Department of Labour
Economics and Industrial Relations at the Black Sea Technical University in 2005. In 2012, she
completed her doctorate at the Black Sea Technical University, Institute of Social Sciences,
Department of Economics. She served as Head of Department between 2005 and 2008. Between
2010 and 2015, she served as Assistant Director. She served to as Assistant Associate Professor
between 2015 and 2018 in the Black Sea Technical University Tourism and Hospitality Vocational
School. Dilek TANDOĞAN, who still continues to serve as Assistant Associate Professor at the
Trabzon University Tourism and Hospitality Vocational School, is married, and a girl’s mother.
Index
Commission, 30, 47–49, 51, 63, 83, 143, 157, Degree, 25, 26, 32, 90, 120, 142, 163, 209,
210, 241, 251 219, 228
Commitment, 4, 21, 37, 82, 83, 85, 86, 99, 100, Demonstrate, 17, 21, 35, 82, 143, 166, 194,
105, 146, 156, 160, 177, 180, 230, 238, 200–202, 236
239, 241 Department, 3, 88, 94–96, 162, 178, 201, 238,
Committee, 6, 7, 83, 84, 88, 92, 93, 96, 97, 99, 250
181, 240, 242 Deposit, 156, 193–197, 200–202, 204
Company, 3–8, 14, 16–19, 21, 22, 25–28, 30, Destroy, 83
32–35, 41, 51, 73, 75, 81–100, 107, Destruction, 82, 83
128, 141–145, 147, 148, 153–157, 175, Development, 5, 7, 8, 13–15, 17–19, 21, 25,
185, 208, 212, 213, 238, 241, 243 27–29, 33, 34, 45–49, 51, 54, 56,
Compliance, 19, 81, 83, 85–88, 90, 92, 94, 98, 61–72, 75, 76, 85, 88, 92, 94, 95, 97, 98,
99, 145, 175 105, 141–143, 145–148, 154–157, 159,
Concern, 13, 35, 84–86, 88, 143, 145, 173, 160, 168, 169, 173, 174, 176, 177, 180,
181, 218, 229, 230 183–187, 193–196, 198, 199, 202, 203,
Conclusion, 229 211, 217, 221, 223, 225, 226, 229–234,
Conduct, 81–85, 87, 93, 98, 103, 154, 234 237–244, 249–252, 254, 255, 257, 261
Conflict, 55, 82, 106, 126, 163, 168, 186, 217, Directors, 84, 85, 87, 90, 92, 94–98, 144, 161
219, 223, 232 Disclosure, 5–7, 53, 54, 83, 103, 106, 107, 115,
Connection, 27, 33, 83, 173, 241 121, 128, 143, 175
Consequence, 3, 45, 56, 82, 161, 174, 184, Driven away, 82
229, 256, 259 Duties, 82, 98, 99, 103, 120, 163, 196, 233
Content analysis, 81, 88–90
Contribution, 17, 19, 27, 28, 33, 41, 45, 46, 61, E
62, 82, 141, 142, 155, 157, 173, 174, Educate, 82, 241
226–228, 230, 232, 236, 242, 243, 250, Education, 4, 17–19, 21, 29, 30, 32, 48, 49, 64,
252, 254–256 92, 97, 107–109, 115, 121, 123–128,
Corporate, 6, 7, 14, 15, 17, 21, 22, 45, 49–57, 130–132, 134, 141–143, 145, 146, 148,
82, 84, 85, 87, 89, 94, 95, 141–146, 156, 152–155, 157, 160, 161, 168, 176, 178,
185, 186, 193, 204, 238, 240–243 184, 186, 199, 208, 210, 221, 225, 235,
Corporate governance, 3, 4, 6, 7, 45, 50, 55, 236, 239, 240, 242, 244, 254, 260
82, 84, 85, 144, 145 Educational, 81, 93, 115, 148, 168, 173, 180,
Corporate social responsibility, 3, 45, 50–53, 181, 208, 221
57, 94, 96, 141–145, 147, 157 Effectively, 17, 20, 52, 83, 85, 200, 207, 221,
223, 239, 261
D Effectiveness, 21, 28, 33, 35, 81, 84, 144, 147
Damage, 7, 8, 15, 50, 76, 82, 83, 220 Efficiency, 7, 26, 28, 29, 33, 55, 63, 66, 76, 77,
Data, 30, 31, 55, 73–77, 87–89, 92, 93, 97–99, 83, 86–88, 90, 92, 98, 99, 142, 146, 154,
142, 148, 165, 166, 168, 170, 181, 184, 168, 181, 231, 234
189, 196, 199, 200, 202, 208, 210, 213, Effort, 6, 13–15, 21, 85–87, 98, 105, 144, 153,
215, 217, 221, 222, 225, 229, 234, 235, 155, 156, 174, 175, 218, 230, 241, 242,
244, 253, 255–257, 259 250, 252, 255, 261
Decision, 5–7, 34, 35, 37, 38, 40, 41, 46, Electronic, 30, 69, 70, 81, 88
49–52, 56, 75, 77, 87, 88, 90, 98, 100, Emission, 3–5, 8, 28, 33, 63, 71, 73, 82, 83,
104, 115, 121, 126, 158, 163, 168, 169, 153, 154
174, 178, 180, 181, 212, 228, 229, 231, Employee, 8, 19, 35–37, 45, 49, 53, 54, 87, 88,
240, 245 92, 97, 103–108, 114, 115, 120–134,
Decrease, 37, 46, 51, 74, 99, 148–150, 152, 146, 151, 154, 156, 175, 178, 202, 210,
153, 158, 173, 186, 189, 194, 198, 200, 214, 233, 241, 242, 256
202, 217, 233, 234, 250, 254, 255 Engage, 16, 20, 71, 81, 85, 86, 98, 99, 169
Decree, 83 Entrepreneurship, 21, 180, 181, 225–228,
Deforestation, 4, 8, 82 232–235, 237–239, 241–244
Index 267
Environment, 4, 8, 13–15, 19, 26–28, 33, Framework, 4, 21, 34, 38, 41, 63, 81, 90, 92,
46–53, 56, 63, 71, 75, 77, 84, 86, 89, 108, 141–143, 155, 180, 184, 186, 213,
93–96, 106, 144, 146, 154, 156, 163, 229, 230, 239, 244, 245
173, 185, 196, 198, 204, 209, 219–221, Function, 27, 28, 33, 56, 64, 75, 81, 84, 94, 95,
228, 237, 239, 243, 244, 249, 254 106, 145, 194, 196, 204, 207
Environmental, 3–8, 14–16, 19, 26–28, 33, Fundamental, 6, 29, 34, 62, 66, 77, 85, 88,
45–49, 51–56, 62, 65, 71, 74, 82–86, 159–161, 163, 177, 185, 228, 230, 231,
89, 99, 106, 143, 145, 146, 153, 156, 236, 239, 244
230, 239, 250, 251
Environmental committee, 82–85 G
Establishment, 83, 144, 157, 168, 227, 252, Gender, 64, 108, 109, 122, 129, 159–163, 168,
258 173–175, 177–181, 183–186, 207–217,
European, 26, 28, 33, 82, 143, 156, 157, 160, 221, 222, 225, 227–234, 237–244, 257,
163, 180, 210, 241, 250 261
Executive, 6, 8, 30, 84, 106, 114, 208 Gender and Development (GaD), 231, 232
Experience, 25, 32, 36, 66, 76, 81, 83, 93, 105, Gender inequality, 173, 184–186, 189, 208,
115, 143, 163, 186, 194, 196, 197, 218, 243, 255
225, 229, 234, 236, 244 Gender inequality index, 174, 184, 186, 188
Expertise, 85, 120, 238 Governance, 3, 5, 6, 17, 21, 37, 62, 82, 84, 85,
Exploration, 82 98
External, 6, 7, 52, 56, 84–86, 88, 92, 94, 97, Great depression, The, 193
106, 112, 113, 115, 121, 128–130, 132, Green, 27, 28, 33, 34, 62, 71, 76, 87, 154, 251
134, 153, 175, 199, 200, 236, 250 Green House Gas (GHG), 8, 82, 83
External debt, 200
Extinct, 82 H
Halkbank, 196, 203
F Hierarchy, 81, 82, 84, 85, 87, 88, 90, 93, 98
Factor, 4, 28, 30–33, 49–51, 54, 62, 71, 77, 87, Hire, 81
100, 104–106, 108, 111–113, 116, 155, Hope, 82, 223
159, 160, 168, 186, 194, 199–202, 217,
218, 220, 226, 228, 234, 241, 242, 250, I
251 Illustration, 5
Failure, 4, 74, 82, 164, 194, 230, 231 IMF, 184, 200
Fault, 82 Impact, 4, 5, 17–21, 26–28, 41, 53, 54, 83, 87,
Financial system, 143, 193, 194, 198, 201, 204 88, 100, 142, 143, 145–152, 157, 160,
Firm, 4, 14, 15, 50, 55, 56, 73, 77, 82–85, 106, 162, 167–169, 207, 208, 214, 219, 220,
141, 175, 193, 204, 208, 226, 229, 233, 229, 232–235, 237, 244, 252, 254–256
234, 239, 243, 244 Importance, 25, 26, 34, 41, 45–47, 50, 51, 53,
First, 15, 17, 27, 30, 39, 45, 47, 49, 51, 53, 55, 54, 61, 62, 73, 83, 85, 99, 126, 141, 143,
56, 61–73, 82, 87, 89, 104, 106, 107, 161, 174, 176, 193, 200, 210, 229, 249,
110, 126, 144, 145, 153, 155, 156, 160, 250, 255
164, 173, 175–177, 179, 184, 194, 208, Income, 28, 33, 71, 77, 82, 147, 174, 181, 183,
213, 221, 226, 227, 229, 230, 232, 234, 193, 196, 199, 204, 221, 226, 231, 233,
236, 249, 250 234, 236, 243, 244, 250, 252, 256, 260,
Foreign, 15, 82, 179, 195, 196, 199–203 261
Forest, 15, 48, 63, 82, 230 Increase, 3, 4, 26, 34, 41, 46, 48, 50–53, 56, 62,
Formal, 87, 106, 111, 113, 115, 121, 129, 131, 69, 74, 77, 82, 103, 115, 121, 126, 145,
133, 134, 181, 234 148–152, 154, 158, 162, 167, 170, 173,
Forms, 53, 81, 88, 142, 145, 161, 163, 183, 178–180, 183, 185, 186, 194, 196,
228 198–202, 204, 208, 213, 231, 236, 240,
244, 249, 250, 252, 255, 256, 261
268 Index
Indicator, 26, 27, 33–35, 48, 56, 84, 142, 144, Level, 6, 8, 14, 15, 17, 18, 21, 26, 27, 32,
147, 174, 177, 178, 183–185, 196, 208, 37–39, 49, 55, 56, 62, 82, 84, 85, 88, 90,
213, 214, 221, 242, 255, 257 93–96, 98, 99, 104, 105, 110, 115, 121,
Indigenous, 82, 238 123, 124, 126–128, 130–132, 141–146,
Indonesia, 3, 81, 89 148, 149, 152, 156, 157, 160, 161, 163,
Indonesia Sustainable Palm Oil (ISPO), 81, 83, 165, 167, 168, 174, 181, 183, 185, 194,
85, 94, 96, 98, 99 197, 210, 219, 221, 223, 229, 231, 233,
Issue(s), 3–8, 16, 17, 28, 31, 36, 45, 49, 51, 234, 236, 237, 239, 241, 243–245, 249,
53–57, 82, 91, 92, 97, 98, 99, 102, 143, 257, 258–260
145, 161–165, 168, 174, 175, 189, 207, Listed, 7, 16, 17, 81, 88, 174, 212–214
218, 224, 227–229, 231, 237–239, 242, London Sumatra (LSIP), 82, 89, 93, 95–97
250 Long-term, 4, 17, 19, 37–39, 49, 86, 144, 148,
Industrial, 3, 15, 18, 61–66, 70, 71, 74, 75, 77, 193, 196, 198, 199, 204, 243, 255
88, 144, 155, 157, 211, 235, 239
Industries, 4, 15, 17, 30, 70, 72, 81–83, 99, M
125, 126, 179, 211 Mail, 30, 81, 88, 165
Industry 1.0, 61, 63–67 Majority, 17, 32, 81, 82, 99, 106, 115, 120, 210
Industry 2.0, 63, 66, 68, 70 Manage, 5, 19, 48, 52, 82, 84, 85, 146, 193,
Industry 3.0, 63, 70–72 204, 234, 244
Industry 4.0, 61, 63, 73, 74, 76, 77 Management, 3, 5–8, 16, 18, 19, 26, 27, 29, 32,
Industry Revolutions, 3, 61–66, 70, 71 34, 38, 41, 46, 47, 50–52, 54, 56, 63, 73,
Information, 5–7, 25, 28, 30, 32, 33, 36, 37, 84, 85, 89, 92–97, 99, 103, 115, 120,
45–47, 49, 53–56, 66, 70, 75, 76, 89, 90, 121, 126, 128, 144, 145, 147, 153, 156,
93–95, 105, 106, 121, 141–143, 147, 163, 173, 179, 181, 186, 203, 207, 213,
158, 165, 166, 168–170, 194, 203, 225, 217, 230, 233, 240, 243
229, 230, 236, 240, 241, 250, 251 Manager, 6, 32, 34, 36, 46, 51, 82, 84, 85, 94,
Initiative, 16, 18, 19, 29, 55, 86, 87, 144, 145, 95, 104, 106, 115, 145, 147, 154, 181,
153–155, 157, 161, 173, 176, 185, 189, 213, 216, 217, 243
210, 218, 238, 240, 241 Mark, 90, 91
Innovation, 21, 26, 28, 32, 55, 63, 64, 66, 83, Marketplace, 86, 238
86, 88, 90, 98, 99, 147, 194, 198, 226, Material, 4, 5, 8, 21, 26, 28–30, 33, 35–37, 45,
227, 234–236, 242, 244 62, 66, 74–77, 87, 92, 97, 98, 146, 155,
Integrated, 6, 7, 18, 19, 21, 53, 55, 56, 69, 70, 156, 160, 165, 169, 231, 238
75, 88, 231 Measurement, 31, 86, 119, 144, 145, 174, 199
Interest rate, 193, 197, 200, 201 Mechanisms, 62, 77, 82, 84, 85, 121, 160, 161,
Internal, 6, 28, 31, 33, 67–70, 73, 85, 94, 106, 181, 201
110, 112, 113, 115, 121, 126, 128–130, Method, 7, 26, 29–31, 56, 62, 68, 73, 81, 84,
134, 145, 163, 175, 220 90, 91, 128, 141, 142, 165, 170, 177,
Interview, 90, 100, 165, 166 240, 249, 251, 255–257
Izmir Economic Congress, 194 Methodology, 27, 29, 35, 88, 107, 165, 170,
216, 217, 219
J Middle, 85, 93–96, 109, 123, 127, 130–132,
Job, 35, 87, 115, 128, 145, 149, 157, 180, 181, 150, 157, 176, 213, 234, 236, 243, 244
208, 216, 226, 227, 234, 242, 250, 252, Middle management level, 81, 82, 84, 87, 93
261 Ministry, 15, 83, 125, 155
Model, 17–21, 26, 27, 29–31, 33, 34, 37, 41,
L 48, 50, 55, 68, 73–75, 84, 90, 105,
Land, 3, 4, 8, 82, 225, 233 108–110, 114, 119, 121, 122, 144, 145,
Lean construction, 25–35, 38, 39, 41 153, 158, 169, 199, 210, 255, 259, 260
Lean management, 25–27, 30, 32, 33, 41 Modification, 90
Legal, 55, 81, 85, 99, 103, 156, 160–163, 165,
167, 169, 203, 227, 245 N
Legitimacy, 85, 86 Names, 17, 32, 82, 84, 87, 89, 93, 94, 96, 98,
169, 227, 258
Index 269
168, 170, 179, 180, 198, 202, 221, 226, Stage, 56, 81, 83, 86–88, 90–93, 98–100, 160,
230, 231, 237, 244, 261 181, 225, 233, 234, 240, 244
Respondent, 25, 30, 32, 34, 41, 86, 164–167, Stakeholder, 4, 5, 19–21, 46, 47, 49, 51–55,
169, 170 84–86, 88, 92, 96–98, 143, 145, 146,
Response, 4, 25, 30, 41, 90, 96, 98, 143, 167, 175, 185, 229, 237, 238, 241, 242
217, 219, 230–232, 237, 241, 242 Standardization, 85
Responsibility, 13, 17, 21, 22, 34, 45, 50–53, Step, 30, 47, 62, 68, 71, 81, 90, 142, 144, 154,
85–89, 92, 94–96, 98, 104, 105, 114, 165, 169, 173, 194, 198, 204, 223, 229
141–143, 145–147, 157, 186, 225, 228, Stock, 16, 17, 37, 56, 81, 88, 175, 201
232, 233, 237 Strategy, 5–7, 14, 19, 21, 25, 28, 29, 33,
Result, 4, 8, 15, 16, 19, 25–30, 32, 47, 50, 51, 38–41, 49, 50, 63, 74, 82, 84–88, 92,
56, 63, 66, 71, 73, 83, 93, 99, 105, 110, 97–99, 143–145, 147, 153, 157, 179,
115, 116, 119, 121–123, 125–127, 129, 180, 185, 200, 201, 218, 229–231, 236,
130, 141, 144, 149, 150, 152–155, 157, 242, 251
161, 165, 167, 169, 170, 173, 175, 186, Structure, 6, 18, 29, 31, 32, 34, 48, 53–55, 65,
197–199, 202–204, 215, 217–219, 231, 66, 70, 71, 77, 82–85, 88, 89, 93, 98,
234, 238, 239, 242, 244, 252, 255, 256, 104, 126, 147, 166, 193, 200–202, 204,
258–261 226, 227, 250
Role, 4, 7, 16, 17, 54, 56, 81–90, 92, 93, Study, 5, 6, 13, 14, 16, 21, 25–30, 32–34, 39,
96–100, 104, 141, 142, 144, 157, 160, 41, 45, 46, 56, 81, 83–86, 88, 89, 100,
162, 176, 198, 204, 210, 216, 217, 223, 103–105, 108, 109, 120, 123, 124, 127,
225, 226, 228, 229, 231, 232, 237, 240, 128, 130–132, 141, 160–165, 169, 170,
242, 256, 261 173, 175, 185, 199, 210, 216, 217, 219,
Roundtable on Sustainable Palm Oil (RSPO), 223, 225, 228, 229, 231–234, 236,
81, 85, 98, 99 242–244, 249, 251, 254–257, 261
Run, 18, 21, 27, 39, 46, 48, 49, 73, 82, 189, Subjectivity, 90
225, 233 Subordinate, 90
Subregions, 249, 252–255, 257–259, 261
S Survey, 16, 30, 41, 81, 88, 108, 125, 142,
Safety, 17, 19, 21, 35–37, 45, 84, 94–96, 106, 164–167, 169, 184, 216, 219, 221
126, 146, 156, 227 Sustainability, 3, 7, 8, 13–15, 17, 19, 21, 22,
Score, 32, 81, 90, 92, 93, 97, 177, 208, 216, 25–30, 32–34, 38, 39, 41, 45–57,
217, 219 61–64, 71, 74, 77, 81–100, 143, 157,
SGRO, 89, 93, 95, 97 175, 185, 193, 204, 230, 238, 239, 243,
SIMP, 89, 93, 95, 97 250, 251
Small-scale enterprise (MSE) sector, 232 Sustainability governance structure, 82, 84–86
SMAR, 89, 93, 96–98 Sustainability Officer (SO), 81–90, 92–99
Social, 3, 15–17, 19, 21, 26, 28, 45–56, 62, 63, Sustainability-oriented strategy, 82
65, 66, 73, 82, 83, 85, 86, 89, 93–96, 99, Sustainability practice, 82, 83
103–105, 125, 141–148, 150, 151, 153, Sustainability Report (SR), 89–96, 98, 99
155–157, 160, 163, 164, 168, 170, 173, Sustainability stages, 82, 86, 87
174, 177, 180, 181, 183, 207, 208, 218, Sustainable, 16, 18, 19, 21, 26–28, 33, 51, 56,
219, 223, 227–231, 236–238, 240, 250, 63, 76, 81, 83, 85, 103, 143–145, 154,
251, 260, 261 156, 174, 175, 193, 194, 200, 204, 226,
Solve, 35, 83 227, 230, 231, 239, 250, 251
Source, 13, 28, 64, 65, 67, 69, 72, 88, 92, 97, Sustainable business, 16, 99, 175
99, 148, 154, 165, 184, 186, 195, 199, Sustainable development, 4, 13–21, 26, 45,
200, 203, 204, 226, 231, 243, 250, 254, 47–49, 51–53, 56, 62, 63, 71, 141–145,
258 157, 225–228, 231, 236, 239, 242, 250,
Species, 82 251
SSMS, 89, 93, 96–98 Sustainable development goals, 4, 62–64, 99,
Staff, 3, 7, 32, 36, 37, 85, 87, 91, 146, 154, 185, 237, 250
168, 199, 203 Sustainable economic development, 175,
249–251, 255, 257, 261
Index 271
Symbol, 66, 68, 90 Turkey, 3, 46, 54, 56, 73, 108, 174–176, 181,
System, 6, 7, 13, 19, 27–29, 37–39, 65, 68, 69, 185, 187, 188, 193–196, 199, 200,
71–76, 86, 94, 105, 106, 143, 144, 148, 202–204, 208, 241, 249–261
153, 164, 174, 178, 181, 183, 194, 196,
199, 201, 227, 237, 239, 240 U
UNSP, 89, 93, 96, 97
T
Table, 33, 89–91, 93, 98, 165, 166, 177, 194, V
196, 231, 243, 257–259 Vakıfbank, 196, 203
Target, 5, 34, 50, 71, 83, 86, 143, 178, 179, Value, 17, 19–21, 27, 28, 31, 33, 35, 38,
181, 208, 210, 226–228, 249 48–50, 54, 66, 68, 73, 77, 86, 110, 121,
Task, 5–7, 36, 38, 39, 87, 88, 120, 141, 196, 145, 147, 148, 155, 156, 160, 174, 185,
216 186, 199, 207, 217–219, 221, 223, 230,
Team, 31, 35–37, 62, 69, 82, 84, 93–96, 103 232, 233, 236, 241, 250, 251, 255, 257,
Technique, 27, 28, 31, 33, 34, 38, 39, 41, 67, 259, 260
71, 74, 75, 90, 183, 220, 221, 231, 236, Voluntarily, 55, 87, 105, 164
251
Term, 21, 27, 30, 31, 37, 47–49, 51, 52, 63, 70, W
76, 84, 115, 126, 143, 147, 157, Waste, 19, 26–29, 33–36, 41, 45, 48, 74, 106
159–163, 166, 167, 169, 170, 179, 193, Waste reduction, 28, 33, 88
194, 196, 198, 200, 204, 217, 228, 231, Wealth fund, 196, 203
233, 243, 250, 251, 255, 257 Women, 3, 18, 21, 64, 71, 159–170, 173–181,
Title, 84, 85, 87–90, 92, 94, 96–98, 178, 257 183–186, 189, 207–223, 225–245, 250,
Top, 8, 46, 70, 71, 76, 82, 84, 85, 87, 94–96, 253–256, 258, 261
115, 121, 154, 179, 211, 216, 217, 221, Women entrepreneurship, 178, 232, 233, 235,
233, 243 236, 242
Top management level, 81, 82, 93, 95, 96 Women in Development (WiD), 230–232
Total, 8, 27, 38, 39, 54, 90, 92, 97, 109, 115, Women rights, 174, 175, 177
147, 148, 154, 159, 165, 166, 175, 178, Word, 47, 50, 72, 81, 87, 90, 98, 99, 215, 223,
180, 196, 200, 233, 249, 253, 257, 258 228, 234, 250, 256
Total employment, 54, 211, 249, 250, Work, 14, 17, 18, 27, 28, 31, 32, 35–37, 49, 51,
254–259, 261 63, 65, 68, 71, 75, 76, 81, 83, 93, 98,
Total number of tourist arrivals, 258 106, 126, 145, 154–156, 161, 165, 168,
Total women employment, 257–261 169, 173, 174, 176, 179, 181, 185, 186,
Tourism, 47, 73, 249–259, 261 207, 210, 211, 213–216, 218, 219, 221,
Trend, 31, 82, 86, 96, 142, 143, 160, 180, 227, 228, 230, 232, 233, 235, 238–240,
209–211, 215, 221, 251 242
Triangulation, 90, 92
TSI, 200 Z
Ziraat bank, 196, 203