Failing to regulate social and environmental reporting in Spain

  1. Larrinaga González, Carlos
  2. Luque Vílchez, Mercedes
Llibre:
XXIII Congreso EBEN España

Editorial: Universidad Pablo de Olavide

Any de publicació: 2015

Congrés: Ética, Economía y Dirección. Asociación Española de Ética de la Economía y de las Organizaciones. EBEN (23. 2015. Sevilla)

Tipus: Aportació congrés

Resum

This paper contributes to understand the production of normativity in the Spanish CSR context. This examination draws on previous literature recognizing that governmental intervention in regulating CSR reporting does not guarantee alone better disclosure levels (Bebbington et al., 2012). More specifically, this theoretical perspective is applied to explore the attempt made by the Spanish government to implement the Danish reporting model through the Sustainable Economy Law 2/2011 of 4 March (SEL hereafter), as a member of the Ministry of Spanish Employment and Labour noted (2011). The Danish government requires by Law the 1,100 largest companies to disclose their CSR performance in their annual reports (PWC, 2011), achieving a high degree of compliance by companies. In the Spanish SEL, Article 39.3 recommends corporations with more than 1,000 employees to elaborate an annual sustainability report which should be submitted to the State Council on CSR. Such regulation has turned out to be a failure in terms of the number of companies producing sustainability reports and the quality of those reports. This investigation examines the sustainability reports published by the largest Spanish companies and interviews relevant actors in the Spanish CSR regulatory field. By examining in detail the failed attempt to produce normativity by the Spanish law, this paper contributes to the current debates over CSR reporting regulation and, more specifically, to the understanding of the prospects of the EU new directive 2014/95/EU on non-financial disclosure, requiring member states to make a range of social, environmental and employee related disclosures mandatory for large companies. The findings of this paper are consistent with the argument made in previous literature that suggests that governmental regulation of CSR reporting does not guarantee alone better disclosing levels and that a normative climate is necessary to accompany changes in the law. Additionally, the paper finds that, apart from the state, a multiplicity of actors, pulling in different directions and with different levels of power, participated in the production of normativity and, eventually, molded the corporate (non-)response to the Spanish Sustainable Economy Law. These findings have provided insight to understand why SEL approval has not produced any significant increase in CSR disclosure in Spanish businesses. Above all, the findings of this paper are important for analyzing the prospects of the EU Directive on non-financial reporting. Member states have already developed heterogeneous initiatives, with different objectives, and it is possible that they will continue doing so.