How to succeed in forming industry standards for environmental and social responsibility? - A multi-industry study analyzing the cooperation process of forming environmental and social industry standards.

Abstract: The formation of industry standards for environmental issues and corporate social responsibility is gaining acceptance but the number of successfully implemented programs are few. On an individual level companies have for some time applied company standards or codes of conduct. But on a collective level cooperation seems much more difficult. Although from an economic point of view there are clear incentives for companies to cooperate and form collective industry standards. This research looks at factors affecting the process of forming multi-stakeholder initiatives for environmental and social responsible corporate practices. Field data from three industry initiatives for sustainable practices are gathered using an analytic and explanatory framework. The model, which was initially developed for the forest sector has been adjust to apply for all industries in this study. The three industries are besides forest, the textile and palm oil sector. Key factors such as industries place in the global economy, structure of the industry, and the history of in the industry on the public policy agenda do play an active role when forming MSIs. Other factors found to be important from the industry cases are to have broad interests represented; concentrated industry interest, and enter discussions with a clear agenda. In spite of positive presented factors failures to reach common ground occur. Some critical barriers are a lack of shared visions between stakeholders and participants standing to far from each other for negotiations to even be considered. Having project management handled by an external facilitator was demonstrated as a success factor in one industry formation process. The three studied industries showed an inverse relationship between product brand recognition and the success of forming MSIs. The higher brand valued a product has the harder it seems for industry initiatives to cooperate. However the correlation needs to be further tested due to the limited number of industry cases looked at. Future understanding in forming successful multi-stakeholder initiatives is important as consumer pressure and NGOs are demanding sustainable practices for environment and corporate social responsibility.