AN ANALYSIS OF PRACTICES OF ENVIRONMENTAL AND SOCIAL RESPONSIBILITY IN COMPANIES THAT ADOPT THE BRAZILIAN NATIONAL QUALITY AWARD

The purpose of this paper is to present a preliminary analysis of organizational practices of environmental and social responsibility in companies that adopt the Brazilian National Quality Award. The award is the highest form of recognition of excellence in business management in the country. The work is based on an analysis of secondary data published by the National Quality Foundation. The paper categorizes 72 organizational practices of 51 companies from 17 different industrial sectors in terms of social responsibility and environmental concern. The results show that most of the organizational practices cannot not be considered exemplary as expected for companies in the journey towards performance excellence. Key-words: national award; sustainability; social responsibility; performance excellence. Introduction From the evolution of quality management concept, performance excellence models have been proposed in various nations around the world. The main purpose of such models are to promote quality awareness, stimulate quality improvement, and foster competitiveness in companies from many parts of the world (Mavroidis et al., 2007). A study conducted years ago identified 76 countries with excellence models, or national quality awards (Cauchick Miguel, 2004a), among them Brazil. The Brazilian National Quality Award – PNQ are comparable to many important proposals in the world (Cauchick Miguel, 2001). The award is the highest form of recognition of excellence in business management in the country. PNQ was established 16 years ago and many organizations from different industrial sectors have adopted the framework for achieving performance excellence. One of the distinctions of PNQ is a specific criterion for assessing social responsibility and environmental concern, which is nowadays of paramount importance face with the need for sustainability. In this context, this paper aims at analyzing secondary data published by the Brazilian National Quality Foundation by examining more than 80 organizational practices related to social responsibility and environmental concern in companies from different industrial sectors. The paper is divided as follows. Next section presents a literature review related to performance excellence models followed by research methods. Then, results are discussed and, finally, concluding remarks are outlined. Literature Review The literature review is divided into three parts. The first one establishes the basis of the Brazilian National Quality Award (PNQ) in addition to a preliminary analysis of international publications concerning PNQ. The second part outlines the criterion for performance excellence, as for the of interest of this study (“Society”). Part three highlights some gaps in the publication concerning the Brazilian National Quality Award. Performance Excellence Framework – The Brazilian National Quality Award The National Quality Award of Brazil (PNQ) is managed by the Fundação Nacional da Qualidade – FNQ (National Quality Foundation), a private non-profit organization established in 1991. The award was officially launched in 1992. The primary purpose of the award is to support, to encourage and to recognize the development of effective total quality management by companies operating in Brazil. Its criteria and assessment stages are designed to help identify organizational strengths and areas for improvement. Five categories of companies can be awarded, namely: large organizations (more than 500 full time employees); medium-sized enterprises (between 51 and 500 full time employees); small-sized companies (up to 50 full time employees); non-profit organizations, and government institutions. The award criteria are built on a set of core values and concepts, which are consistent with those of highly successful organizations. These core values and concepts include (FPNQ, 2008): customer and market knowledge, innovation culture, leadership and constancy of purposes, organizational learning, partnership development, process and information orientation, social responsibility, systemic thinking, value generation, valuing people, vision of the future. The evaluation framework of the Brazilian Quality Award comprises 8 evaluation criteria, sub-divided into 24 items. Table 1 shows the eight examination criteria including the items in each criterion, and the weighting attached to each one. Applicants must address the set of examination items showed on Table 1. As can be seen, the model uses a 1,000-point scoring system. The award relies on three dimensions for determining the numerical score of the examination items. The term scoring refers to the process of identifying strengths and areas for improvement, named improvement opportunities. The dimensions considered are approach, application and results. Applicants are required to provide information relevant to the evaluation dimension(s) specified for a particular examination item. Each dimension of an examination item (from approach and application, or results) is given a score of 0 to 100%, in increments of 10%, depending on its level of merit. The percentage score multiplied by the point value for that item produces an item-by-item score for the application. The final score is a sum of all scores for each item. Both the final score and the report of strengths and opportunities for improvement is carried out with the assistance of a software, called Sideral, specially designed to use when conducting the award process. Table 1 Criteria, Items and Scores of the National Quality Award of Brazil (2008 Cycle). Criteria and Items (Score) 1. Leadership (100) 1.1 Corporate governance (40) 1.2 Leadership exercise (40) 1.3 Critical performance review (30) 2. Strategy and Plans (60) 2.1 Strategy formulation (30) 2.2 Strategy implementation (30) 3. Customer (60) 3.1 Image and market knowledge (30) 3.2 Customer relationship (30) 4. Society (60) 4.1 Social and environmental responsibility (30) 4.2 Social development (30) 5. Information and Knowledge (90) 5.1 Organizational information (30) 5.2 Comparative information (30) 5.3 Intangible assets (30) 6. People (90) 6.1 Work system (30) 6.2 People education and development (30) 6.3 Life quality (30) 7. Process (110) 7.1 Main processes and support processes (50) 7.2 Suppliers process (30) 7.3 Economic-financial process (30) 8. Results (450) 8.1 Economic-financial results (100) 8.2 Customer and market results (100) 8.3 Society results (60) 8.4 People results (60) 8.5 Main processes and support processes results (100) 8.6 Supplier results (30) Total Score: 1000 The award evaluation process initiates by the submission of a management report by the applicant. The applicant’s management system is then reviewed and evaluated by members of the board of voluntary examiners in a three stage process (Cauchick Miguel, 2005): • Individual review: the application report is individually reviewed by a group of up to ten examiners. Once the review is completed, charts and tables with the average score are sent to the judges for review. The judges based on the applicants’ score and award categories and without knowing their names, determine the applicants that will proceed in the review process. • Consensus review: the application reports of applicants that goes to this stage are reviewed by a smaller group consisted of one senior examiner, one reporter examiner and four examiners from last stage. The examiners determine consensus score to each of the 27 items. Once the review is completed, charts and tables with the average score are sent to the judges for review. The judges, based on the applicants’ score and award categories and without knowing their names, determine the applicants that will be visited. • Site visit: selected applicants are visited by the same six examiners of previous stage. The major objective of site visits is to confirm the responses included in the application report as well as to clarify any doubts occurred during review. Site visit planning is agreed by the applicants and the foundation. After site visit, the examiners issue a report with the major conclusions of the visit and a final score, which are sent to judges for their final review, and recommendations of award recipients. The “Society” Criterion This criterion of the performance excellence framework examines how the organization contributes to the economic, social, and environmental development with sustainability. This may occurs by means of minimizing potential negative impacts of its products and operations in the society. It includes how the organization interacts with society ethically and with transparency. The criterion is divided into two items, namely (FNQ, 2009): • Social-environmental responsibility: implementation of managerial processes that directly contributes to the generation of products, processes and installations safe to the users, society and to the environment as well as promoting the sustainable development. • Social development: implementation of managerial processes that directly contributes to foster the social development as well as to promote a favorable image of the organization to the community and society. PNQ Literature analysis The publications on the PNQ are not extensive. In a search in the Emerald data base with 6 key-works and combinations – in English and Portuguese – (PNQ, premio nacional da qualidade, Brazilian national quality award, Brazilian quality award, and Brazilian award), the number of papers was 46 in 31 referred journals. Table 2 shows the main results of this partial bibliographical search. Table 2 Emerald Bibliographical Search (number of papers = 46). Item Result Quantity of referred journals 31 Period of publication From 1978 to 2007 (47.8% papers published in the past 5 years – 2003-2007 32,.6% published in 2006 and 2007) Number of journals out of scope of the subject 5 (16.1%: J. of Documentation; J. Financial Crime; J. Managerial Psychology; Management Law; Online Information R