A HUMAN RESOURCE PERSPECTIVE ON POLICIES TO SUPPORT .

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A Human Resource Perspective on Policies.ResearchResearch. .A HUMAN RESOURCE PERSPECTIVEON POLICIES TO SUPPORTCORPORATE SOCIAL RESPONSIBILITYMuhammad Zia-ur Rehman1, Mahwish Khan2 and Safdar Nazeer3AbstractWithin the last decade, the phenomenon of Corporate SocialResponsibility (CSR) has gained significance in the corporate worldfrom a marketing context, yet very little empirical work exists tohighlight its importance from a human resource context. CSR is oftenembedded in the sustainability agenda of the organization, in whichdifferent factors impact the CSR based human resource (HR) policiesof an organization. The data were collected through interviews andTelenor’s mission and policies for employees, society, environmentand customers were analyzed. Three themes emerged in the interviewthat affected the CSR based HR policies: management style, economicimpact of CSR on the organization and the overall CSR strategicapproach of the firm. The paper concludes that CSR is stronglyemphasized in Telenor Pakistan’s approach and reflected in its codesof conduct, policies as well as management style.Keywords: Corporate social responsibility, Human resourceperspective, HR Policies, Telenor, Economic impact, Strategic approachJEL Classification: Z0001- National Defence University, Islamabad, Pakistan2-Iqra University, Islamabad. Pakistan3- Preston University, Islamabad, Pakistan581PAKISTAN BUSINESS REVIEW OCT 2015

A Human Resource Perspective on Policies. .ResearchIntroductionThe importance of Corporate Social Responsibility (CSR)for organizations is emphasized both in academic theory and businesspractice. CSR is embedded in the sustainability agenda oforganizations that evaluates the impact of the organization on theenvironment, the society, employees, suppliers and customers. Theincorporation of this CSR philosophy in an organization is dependentupon a lot of factors. Some of these factors or themes were exploredin this paper.Telenor PakistanThe telecom sector in Pakistan is one of the fastest developingsectors of Pakistan’s economy and playing its crucial role for economicgrowth. This sector having approximately more than 100 million userswith more than 1.36 million employees and various unidentifiable otherbeneficiaries. 1 This immense growth increased the pressure oncompanies operating in this sector to gain competitive advantagethrough the effective use of its statistic business aspects, one ofthem is CSR which is also becoming a binding force with its users.Telenor Pakistan, a subsidiary of Telenor was selected forthe study. This particular organization was selected because it is oneof the world’s largest multinational firms in the telecommunicationssector. It offer voice, data, and content and communication servicesin various markets across Europe and Asia, serves more than 148million customers, and employs a workforce staff of approximately32,900 professionals. The company started operations in Pakistan inMarch 2005 and currently serves more than 30 million customers inPakistan. In 2004 Telenor founded Telenor Pakistan that beganoperations in March 2005, reaching its breakeven in 2007. Due to itsaggressive marketing and advertising and social initiatives, it is thefastest growing cellular network of Pakistan.PAKISTAN BUSINESS REVIEW OCT 2015582

A Human Resource Perspective on Policies.Research. .Telenor and CSRFaced with a turbulent global environment Telenor has usedcorporate social responsibility (CSR) as a survival strategy. CSR is acrucial competitive element as public opinion and customer preferencesare aligned with the behavior of organizations towards society andenvironment. In this context Telenor views sustainable developmentcritical to its long-term success and from 2012 it added information onsocial and environmental performance in its annual report. Telenoralso publishes an annual Sustainability Report. Telenor has a code ofconduct called “Telenor Way” focusing on employees as the mostimportant asset for the firm. The three main components in the TelenorWay are: a strong customer focus, never to compromise on ourbusiness ethics and a leadership based on empowerment. The TelenorWay, coupled with the CSR business strategy, Telenor focuses onhuman rights and cooperates with relevant third parties. Otherorganizations are also focusing its attention on CSR like National Bankof Pakistan2, Coca-Cola Company 3 and Ufone 4, Mobilink 5 are intelecom sector.Literature ReviewOrganizations are integrating environmental and socialconcerns into their products, their operations, and their managementstyle. This includes ethical and transparent interactions with all oftheir stakeholders, particularly their employees. Organizations andemployees are dependent upon each other as they support each otherand create value in constant exchanges with each other (Van Marrewijk,2003). 6CSR is a process that aims to accept the responsibility of the companyfor its actions and positively impacts the environment, employees,consumers, communities, and all other stakeholders. While this trendstarted in the USA and Europe, organizations in developing countriesare also adopting CSR, particularly those situated in Asia (Chapple &583PAKISTAN BUSINESS REVIEW OCT 2015

A Human Resource Perspective on Policies. .ResearchMoon, 2005).7 Organizations must try to integrate the CSR strategyinto their overall business strategy.The main objective of this study is to identify the role ofmanagement styles, strategic and economic significance in developingHR based CSR policies are still unfamiliar area. On various platformsour conceptual framework requires attention as the company policiesshould be facilitating to its employees that will ultimately lead towardsthe betterment of society and enhanced performance. (Inyang, Awa,and Enuoh, 2011) 8 In current academia discussions, research findingsand even in discussions, the focus in on the nature, direction,participation and process of CSR but CSR as a corporate phenomenonin actual fact should be a strategic approach and methodology fororganizations to gain completive advantage and to address issueswith its concerns and through those interfaces, it may help to achievesuccess in their business goals.Management StyleManagement Style is important in CSR. Management Stylemeans that managers make decisions with a transparent and integralmanagerial style. The managers use on-site audits to ensure that theiremployees comply with minimum CSR standards and hence use suchaudits to ensure this compliance. Managers must embrace a socialmanagement style so that they can move the overall quality of theirCSR programs (Van Marrewijk, 2003).9 Furthermore they can extendthis management style to the management of even their suppliers.Managers can perform on-site audits to ensure supplier compliancewith their organization’s minimum CSR requirements (Palacios Marqués& Devece Carañana, 2013). 10Economic Impact of CSRAt the turn of the 21st century, the linkages between financialperformance and CSR have been explored by various researchersPAKISTAN BUSINESS REVIEW OCT 2015584

ResearchA Human Resource Perspective on Policies. .(Margolis & Walsh, 2003; Salzmann et al. 2005; Wagner et al. 2001;Pava and Krausz 1996, Peloza 2006, Ali, Ur Rehman et al. 2011),11 12 13 14while some also investigated this issue in Pakistani context undervarious conditions (Seljuq, 2005; Waheed, 2005; Yunis, 2012) 15 16 17especially in cellular sector (Ali, Rehman et al. 2010; Ali and Zia, 2011).18 19Some people consider CSR to be a fashion of the 21st century,because they consider CSR to be a philosophy that is in contradictionto the profit-oriented philosophy of an organization. They believethat corresponding to the obsession of organizations with ISOstandards and certifications that emerged in the last few years CSRtoo is a similar obsession of the corporate world. Others believe thatCSR leads to cost-reduction that impacts the economic state of theorganization. This latter group believes that just as standards andcertifications improved the product and processes of organizationsthat eventually benefited consumers and society, this CSR trend toowill have an immense impact on society.Strategic Firm’s Approach to CSRManagement of the organizations need to use effective managementstyles and approaches to enhance the integrity of the ethical, social,and environmental aspects of their business. This translates into thefour fundamental pillars that refer to CSR: environment, social action,health, and disability. Now a days firms with latest and advancedversions of HRM are focusing on CSR and its strategic and competitivenature leading towards improved performance and outcomes.(Buciuniene and Kazlauskaite, 2012; Gond, Igalens et al. 2011)20 21Organizations can have different strategic approaches to CSR. Themost common approach is corporate philanthropy where aid, donationsand sponsorships are provided to under privileged members of thecommunity. Another approach is using CSR for risk management bywhich organizations strategically identify risks and set up plans forimprovement (Palacios Marqués & Devece Carañana, 2013). 22Organizations can also embed CSR into the core business strategy bycreating value and promoting sustainability (Porter & Kramer, 2006).23585PAKISTAN BUSINESS REVIEW OCT 2015

A Human Resource Perspective on Policies. .ResearchBased HR PoliciesProductivity can be enhanced by formulating HR policiesfor managers and employees that treat them as a valuable part of theorganization (Wolf, 2012; Gond, Igalens et al. 2011, Buciuniene andKazlauskaite 2012).24Strategic Human Resource Management incorporatesstrategic nature of various aspects of organization to create morevalue, effective planning, cost reduction, enhancing internal andexternal quality, and to augment organization’s capacity to face changeto gain a competitive advantage also turned the focus towards CSR.(Gond, Igalens et al. 2011; Buciuniene and Kazlauskaite, 2012) 25 26Becoming a strategic business partner, HRM at the moment is moreparticipative in decision making coupled with policy formulation atcorporate level, the HR experts are shaping CSR creativities in variouspolicy agendas.The organization can draft policies that focus on improvingthe satisfaction of their company staff, and once these policies areproperly enforced within the organization, they can extend thesepolicies to their supply chain members. This CSR approach wouldensure that even their supplier’s employees have a higher quality oflife particularly those whose jobs put them in greater physical risks(Palacios Marqués & Devece Carañana, 2013).27MethodologyUsually researchers follow a quantitative approach but herewe used a qualitative approach to explore more about the underlyingarea. Qualitative approach provided a more open space to get littlemore options as compare to quantitate approach. We therefore,extracted the themes out of the relevant literature existing, then turnedthose themes into interview points to extract the relevant answersfrom the respondents appropriately and within the scope of the study.PAKISTAN BUSINESS REVIEW OCT 2015586

ResearchA Human Resource Perspective on Policies. .A qualitative approach in the form of an interview is the mainmethodology adopted that provided a real-life context in understandingCSR practices of the ICT sector in Pakistan. Semi-structured interviewswere used to obtain management feedback and relevant information.This technique allowed the interviewee to explicitly express theirgeneral points of view in detail while not getting de-tracked duringthe interview. It also allowed the interviewer the opportunity to askquestions for getting a comprehensive answer or re-explain a certainanswer. In order to explore Telenor’s CSR strategy, an in depth semistructured interview was conducted with the Corporate ResponsibilitySpecialists in the Corporate Communications and ResponsibilityDepartment who had been working at Telenor for at least more than 2years and were Project Managers for three of the biggest CSR projectsat Telenor i.e. Khuddar Pakistan, Hum Qadam and Emergency Responseprojects. All of these projects required close coordination with the HRdepartment. The interviews lasted approximately three hours. Theinterview focused on two main topics. The first topic was the generalgoal and objectives of Telenor on CSR and the second topic wasrelated to the policies Telenor drafted in order to achieve these CSRgoals.Data Analysis and Discussion of Emerged ThemesAnalysis of secondary data available on Telenor Pakistan,the Telenor Group, along with interview revealed that the ICT sectorhas significant potential for CSR. This sector can contribute to thesocio-economic growth of Pakistan and have a significant impact onboth internal and external stakeholders. The CSR policy of TelenorPakistan is centered on environment, society and management style.The latter incorporates the HR element of CSR that falls under thesustainability domain of the organization. Telenor has incorporatedan Environmental Management System (EMS) that looks intoenvironmental impact of the organization in compliance withinternational standards and its internal policies and codes of conduct.587PAKISTAN BUSINESS REVIEW OCT 2015

A Human Resource Perspective on Policies. .ResearchEmerged ThemesThree main themes emerged in the interview that impact theCSR based HR policies of Telenor Pakistan. These three themes are:the management style, the economic impact of their CSR activities,and the overall strategic approach of the firm towards CSR. Thesethemes are discussed below:Management StyleThe first theme that emerged was management style.Management style implies that the management engages in decisionmaking that is transparent, inclusive and integral.“We have used our existing recruitment processes,procedures and policies and we have tried to make them inclusiveand accessible”A good management style encourages corporate citizenshipbehavior where employees are oriented to actively engage inoperational activities and projects.“ This way employees also take ownership of the projects,get to know these projects and get to work in them .”Managers can motivate employees by becoming role models and setexpectations that they themselves can act upon.“ one should lead by example and others should follow.”Furthermore, value addition and problem-solving approachmust be encouraged in their decision-making that exhibits effectiveutilizations of all resources i.e. financial, technological, human etc.“We don’t channel just financial resources or financial support incash or kind for such activities, we also channel valuable humanresources into those initiative”PAKISTAN BUSINESS REVIEW OCT 2015588

ResearchA Human Resource Perspective on Policies. .“ It is based on what needs to be done and how can Telenor contributeto it and add value to that cause. “A good management style must incorporate open and efficientcommunication within the workplace and with external stakeholders.The HR department can play an important role in the coordinationand communication of the norms, values and standards that impactvarious aspects of employee’s jobs.“ A dialogue was held regarding inclusion of persons withdisabilities in the mainstream the workplace and the educationalinstitutions around the UNCRPD (United Nations Conventions onRights of Persons with Disabilities) that .”“ We are in coordination with our HR offices. They [HR]work in close coordination .”“ we are a very dynamic organization and work in closecollaboration with all the educational institutions.”All managers regardless of whether they are performing HRfunctions or project management functions must enforce and adhereto non-discriminatory fundamental rights of employees. This nondiscriminatory management style can start at the actual hiring stageof employees, where candidates are not segmented based on gender,ethnicity, diabilities, economic or educational backgrounds etc.Candidates are recruited based on purely their competency and skills,and assessed and evaluated based on these competencies.“You need to provide equal opportunity. You need to huntfor talent and diversity; quota or no quota. As an employer you needto provide equal opportunity, you should not discriminate on thebasis of physical abilities or disabilities, gender, race, ethnicity etc”“We [Telenor] believe in equal opportunity, diversity and talent.”589PAKISTAN BUSINESS REVIEW OCT 2015

A Human Resource Perspective on Policies. .Research“ We don’t discriminate within the institutions that this isa high-end institution and [this one is not] because then we aremarginalizing a huge segment of your population and of your humanresource that does not have access to those [educational]institutions.”Good managers support and encourage diversity in theworkplace, and stay clear of stereotyping or other judgmental biases.“ We have on board people from every [different universitysuch as], public sector universities, private sector universities, localuniversities, foreign universities, high-end universities and normaluniversities, so called, and that’s how we have collaborations withhigher educational institutions .”Furthermore, these CSR activities and good managementstyles must be extended to the supply chains of an organization.Telenor exhibits a management style conducive to CSR. Theorganization has drafted comprehensive Codes of Conduct andSupplier Conduct Principles. A further initiative in the form of the“Telenor Way” incorporates CSR into its overall corporate culture.Management style is also reflected in the channeling of humanresources towards CSR activities such as encouragement of employeevolunteerism activities through Hum Qadam and Emergency Responseprojects. Telenor Pakistan played a prominent role in 2010 and 2012floods, in the form of disaster relief and voluntary efforts. Employeesvolunteer through the Emergency Response System to supportearthquake, flood and accident victims free of charge. In this regardthey coordinate with international agencies such as the Pakistanchapter of the Red Cross Society (PRCS), the government and othernon-profit partners.PAKISTAN BUSINESS REVIEW OCT 2015590

ResearchA Human Resource Perspective on Policies. .Economic Impact of CSRThe second theme that emerged was economic impact ofCSR activities. All the five CSR projects Khuddar Pakistan, HumQadam, Emergency Response, E-Learning and M-health have asignificant economic impact on both Telenor and the overall society.The economic impact for Telenor is in the form of goodwill, attractingcompetent employees, public private partnerships, and internationalcollaborations and of course profitability.Organizations engaged in CSR initiatives can have asignificant economic impact only if such initiatives are based upontheir core competencies.“ It should contribute directly or indirectly to our corecompetencies as well as to the economy, the community, the people atlarge and the overall environment. ““ We [Telenor] just strive for doing what needs to be donewithin the identified framework of CSR. We first of all we identify anarea where we can actually add value using our core competency, notonly in terms of financial contribution but also based around enablingpeople through the use of ICT. “The major economic impact of CSR on an organization is interms of cost-reduction. This aspect was not highlighted in theinterview. Rather, the impact of the organization’s CSR initiative onthe economy was emphasized. Some of these impacts were:opportunities of employment particularly for those segments who arediscriminated against such as the disabled people.“It is one of the most dynamic sectors of Pakistan so thatway we will contribute to the unemployment problem of Pakistan. “591PAKISTAN BUSINESS REVIEW OCT 2015

A Human Resource Perspective on Policies. .Research“ Telenor can help the society directly by creating

also publishes an annual Sustainability Report. Telenor has a code of conduct called “Telenor Way” focusing on employees as the most important asset for the firm. The three main components in .

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