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CORPORATE RESPONSIBILITY REPORT 2005/2006

WE UNDERSTAND THE COMPLEXITY OF THE MODERN WORLD

CORPORATE RESPONSIBILITY REPORT 2005/2006


VISION & VALUES & CODE OF CONDUCT - CHAPTER TITLE

HAUSKA & PARTNER CORPORATE RESPONSIBILITY REPORT 2005/2006

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HAUSKA & PARTNER CR REPORT

CONTENT

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BEING DIFFERENT, WORKING DIFFERENTLY

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EVOLUTION OF CR IN HAUSKA & PARTNER GROUP

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SCOPE OF THE REPORT

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ABOUT HAUSKA & PARTNER GROUP

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How “disorganised” are we?

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2005 financial results

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Hauska & Partner employees

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How many of us there are

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What we offer General employment information

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OUR HR PRACTICES

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Developing our people

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Improving our workplace

Publisher:

Hauska & Partner Ltd.

We would appreciate your views

BreπÊenskoga 4

on our report and our performance.

HR-10000 Zagreb Tel. +385 1 4500 222

Editorial Board:

Daria Mateljak Bartulin, Leo Hauska,

CR Director for H&P Group

Srba JovanoviÊ, Annette Märk,

andreja.pavlovic@hauska.com

Katarina Rimac, Ana Smoljo, Petr Stoklasa, Ivana Tavra, Gordana VesiÊ, Bernhard Wanasek Apostrof Ltd.

Designed&produced by: Number of copies:

2

Andreja PavloviÊ Senior Consultant

Andrea Marπáková, Andreja PavloviÊ,

Proofreading:

Please contact:

Fax. +385 1 4557 218

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CONTENT

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SHAPING OUR FUTURE

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Our future in the World CafĂŠ

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Should we not strive to be better than the best?

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Building unique workplace standards

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Flexibility in the focus

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Partnership with DNV

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By-laws

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Becoming great consultants

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A WORD FROM AUDITOR

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FOLLOWING G3 GUIDELINES

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MOVING FORWARD

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HAUSKA & PARTNER CR REPORT

BEING DIFFERENT, WORKING DIFFERENTLY

In the brief time that we grew from a traditional PR agency with a strategic twist to a more interdisciplinary consulting firm, we have been confronted with several professional sins or temptations. The first problematic area is (the moreor-less justified) tarnished reputation of our profession. This field suffers open or tacit accusations for being superficial and promotion-oriented, filtering facts into exclusively positive contours, hiding valuable core information or manipulating stakeholders, and the list goes on. Crucial in our development was the moment when we decided to “do different things differently”. We armed ourselves with a shield of courage, a sword of persistence and a heart of belief in our values and embarked on the high seas of corporate and organizational expectations. In the meantime we figured out that the very first prerequisite for being different and better at the same time was to cease providing “ready textbook solutions” to our clients and to start developing situations in which we partner with our clients in order to jointly create the best outcomes. The key word in this kind of work is quality. Have we been successful in this? Not always. Integrity demands high standards and we still face temptation of yielding to superficial fame and short-term success due to the ambiguous boundary limits between communications and marketing, promotion and stakeholder dialogue, benefits from extensive media coverage and stakeholder trust. A giant step for us was the commitment to recognize such

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situations, acknowledge them and take the right side before it is too late. We are still learning. As we grew larger and more sophisticated in our work, and achieving better professional results, we encountered more chimeras, internal and external, material and psychological. Responsible behaviour cannot be demanded. Being better does not simply mean saying “No, Sir (or Ma’am)” when you disagree with a client on matters of corporate reputation or stakeholder relations. It means taking the trouble to explain why we disagree and to demonstrate additional concern for the client’s longterm benefits. Sometimes this requires statements that are not written in textbooks or proclaimed on the “to-do lists” of PR manuals. And this makes our work difficult. To keep on the right track and properly contribute to the development of the communications profession and to be able to respond to the ever changing world. For example, how can we explain the fact that the media are growing in power, size, influence, numbers and shape, while at the same time the share of media relations in consultancy activity portfolios is decreasing? One of the challenges is to find sound methods of balancing needs, initiatives or simply common sense in involving stakeholder groups directly in the issues of an organization. In many ways, we feel that the world of communications has to undergo a catharsis and address the ancient roots of democracy recorded


BEING DIFFERENT, WORKING DIFFERENTLY

in the historical works of political thinkers. PR is not the art of sorting jigsaw puzzles of words, and we should be very careful not to concentrate too much on words, sounds and pictures. We must look for ways to address and concentrate on behaviour. Promotion blends well with words. Stakeholder relations require deeds. Modesty and good measure are additional challenges for successful performance. Unfortunately public relations (previously), communications management and stakeholder relations turned into a very attractive profession for people seeking fame and glory, media exposure, extensive travel and fancy lifestyles. At Hauska & Partner we are a group of professionals who know that our job is more about “blood, sweat and tears”. Hard work is required with a no-nonsense attitude, along with good common sense for limits and taste. Fancy is not a word that places very high on our agenda. We are not allowed to take creative escapades in our behaviour or style like advertising people. Getting ourselves to this stage, and convincing our partners that communications go farther than a “glass of champagne and a smart suit”, is a difficult process. It has much to do with understanding substances. Just one allegory - if we get up in the morning feeling sick and looking even worse, our natural instinct and common sense should be to call a doctor, rather than undergoing a thorough make-over at the beauty parlour. So why do we resort

to superficial and fashionable tools in our professional lives, instead of exploring the causes to eliminate the problem? The last, but not least challenge is how to create a consultancy which can respond to all of its own ambitions and external demands? It took us several Humpty-Dumpty exercises to figure out that not only the shape, but also the material and the way you move are vital to prevent falling off the wall, or surviving if it happens. Good material is difficult to find, grow, cultivate. Therefore, we took creating conditions in our glass house seriously. Corporate culture is what matters. Matching values to our environment, leading by them, cherishing leadership and fairness may create an organization which is ready to have the right professionals. However, the right professionals are not bought - they are earned. We are still learning. Daria Mateljak Bartulin, MCIPR

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VISION & VALUES & CODE OF CONDUCT - CHAPTER TITLE

ONLY WITH OPENNESS AND FLEXIBILITY

we CAN SUCCEED

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VISION & VALUES & CODE OF CONDUCT - CHAPTER TITLE

1 / EVOLUTION OF CR IN HAUSKA & PARTNER GROUP

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HAUSKA & PARTNER CR REPORT

1 / EVOLUTION OF CR IN HAUSKA & PARTNER GROUP

Unlike many other companies, which start implementing CR through reporting, we came to CR through relationship management, the very essence of our management consulting work. In relationship management, it is not enough to just be a good communicator. It requires not only openness and flexibility, but also readiness to combine different, often “hybrid” skills and knowledge, in order to be able to determine new models for collaboration with stakeholder groups. These new forms, or as we call them platforms for dialogue, can take many different forms, but what is really important here is to understand that companies (as well as other organizations)overwhelmed with a wide array of issues and a large number of stakeholders who quite often have different or even opposing expectations and interestsneed to think of stakeholder relations in strategic terms. In the course of the last three years, we have developed a framework in which we assess and analyze stakeholders, their immediate concerns and expectations and their relevance to business objectives and strategy in order to be able to understand and prioritize issues that can have significant impact on our operations. On the other hand, we bring immediate concerns and expectations in perspective by aligning them with our vision and direction for reaching sustainable growth. In between these

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two poles, we constantly challenge our role in development of our profession and the modern world.

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Dealing with CR requires self-reliance, team skills and the ability to make judgments for courses of actions in highly complex situations with increasingly unpredictable outcomes. We use CR as an opportunity rather than a risk management tool in order to revisit our daily business practices, and wherever needed to instil new management and business practices. All in all, we have undergone a very dynamic process in which we combined different areas of expertise, our experience in dealing with many different stakeholder groups and our understanding of their different agendas, areas of influence, organizational cultures and ways of doing business. After three years, we believe we are ready to prepare our first CR report, which should serve as a basis for further dialogue with our employees and other stakeholders. We invited some of them to join us in the reporting process itself, because we were eager to see our reflection in the mirror realistically, right from the beginning. A holistic approach requires completeness. With this report we will partially meet this requirement, because, as we already underlined, we are sufficiently realistic about ourselves. We wanted


EVOLUTION OF CR IN HAUSKA & PARTNER GROUP

“We believe the real measure of success is both combination of strong profitability and accountability towards our stakeholders” Leo Hauska, President

to establish a clear case that CR is not possible only when it comes to huge, multinational or regional companies, but also in the case of small and mediumsizes companies, regardless of industry or sector origin. We also wanted to establish a strong case for reporting on non-financial indicators that are becoming increasingly important for performance analysis, which is not strictly financial but to a large extent “reflects the health and wealth-creating potential of a company in an entirely different way”. As consultants who contribute to value creation that is not strictly financial such as corporate reputation and brand value, good stakeholders relations, corporate culture, risk management, ethics - we consider non-financial reporting fundamental to understanding a broad spectrum of issues that “can only be understood if one looks outside of the narrow confines of the financial reports as they have been constructed”, as Al Gore stated in his speech given at the G3 Conference in Amsterdam. We also use the GRI framework for reporting, not only because it allows a gradual “phased in” approach, but also because we wanted to be able to compare our practices with those of others. We believe our experience with G3 will help us make our information equally valuable both in terms of quantity and

quality and that we will be able to compare our practices with others. As GRI OS, we also hope to contribute to the ongoing debate on applicability of GRI indicators when it comes to small companies. In particular, we would like to contribute to the development of a special sector supplement, given the unique character of our industry, that would provide additional guidance for reporting. Our experience in GRI reporting will also be valuable in meeting the requirements of the UN Global Compact. As a signatory, we will be able to simultaneously respond to both GRI and UN Global Compact requirements, even before we are supposed to produce our first Communication on Progress (COP). Our experience with ISO 9001 and SA 8000 certification is also valuable in terms of engaging in management practices and processes and voluntarily imposing on ourselves standards not required by national legislation. In our subsequent reports, we will assess our business practices in other, equally important areas: our professional conduct on the marketplace, our community relations, environmental impact - limited to our case but still important, as well as our approach to research and development.

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HAUSKA & PARTNER CR REPORT

KEY MILESTONES:

2003

2004

2005

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First active step towards public CSR dialogue: Business organizations talk about CSR together with the American Chamber of Commerce and IBM and more than 50 managers in Austria.

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Development of CR Strategy for H&P Group Support for the ďŹ rst CSR Conference in Croatia - Agenda 2004 Establishment of CSR-Task force within Public Relations Association of Austria

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Development of the Code of Conduct for H&P Group Participation in the work on CSR standard ISO 26000 within the Austrian Standards Institute Participation in the work of UNDP - translation and adjustment of the Business in the Community Guidebook for introducing CR in companies in Croatia Contribution to the establishment of the Network of Social Responsibility in Austria Establishment of Viennese Group for Integrity Management and Social Responsibility in order to contribute to CSR research and development Education on the subject CSR started at different schools and universities


EVOLUTION OF CR IN HAUSKA & PARTNER GROUP

2007

2006 -

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Establishment of CR Working Group within H&P and appointment of H&P Group CR Director Becoming GRI Organizational Stakeholder Signing of the UN Global Compact principles Membership in the International Business Leaders Forum in the Czech Republic agreed as of 1st January 2007 Membership in Croatian Business Council for Sustainable Development Membership in the CSR-Platform respACT austria Participation in the work on CSR standard ISO 26000 in Serbia

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H&P representative became Vice-president of the Association for CSR within the Croatian Chamber of Economy Signing of the memorandum of understanding with Det Norske Veritas in the course of preparations for SA 8000 certiďŹ cation in Croatia Signing of the memorandum of understanding with UNDP in the course of preparing CR report preparations in Croatia Signing of the memorandum of understanding with SMart Kolektiv in the course of CR report preparations in Serbia

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First CR Report of H&P Group published

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HAUSKA & PARTNER CR REPORT

WHAT IF LEO WERE NOT SO PATIENT? A glimpse from Andreja

I will never forget one particular period in my life. It started with a meeting I had with Leo in September 2004. It was a long meeting, and to be honest I thought it would never end. Leo and I discussed the further development of our CR program and I was trying really hard to understand what he expected from me. The meeting ended and we agreed that I had to prepare a working paper in which I would very briefly underline the steps needed for CR program development. Easy to say, much harder to do. A week passed and I was still not able to deliver the paper in the requested format. Two more weeks passed, and Leo was still waiting. I sent him an email apologizing for being late, explaining that I would like to be up to the task and deliver a genuine proposal, and he replied that he was a little concerned

because we might forget what we had discussed and decided. I finally drafted a comprehensive CR program in which I analyzed the developments that triggered our CR journey, our role in these developments, our objectives and strategies and project framework, because back in 2004 CR was still a project. I sent the paper to Leo and eagerly awaited his comments. I will never forget his mail: “when you wrote ‘I hope you will be quite pleased when you see the outcome’, I still thought ‘O.K., let’s see, and don’t be too optimistic...’ but your document is “WWOOOOOOOOOOOOOOOOOO OOOOW!!!!!!!!!!!!!! !!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!. Even today when I hold the position of CR Director for Hauska & Partner Group, I sometimes wonder: what if Leo were not so patient with me? Would we ever have come so far?

From: Leo Hauska [leo.hauska@hauska.net] Sent: 14. listopad 2004 17:03 To: andreja.pavlovic@hr.hauska.net Cc: Daria Mateljak Bartulin Subject: Re: CSR Dear Andreja, when you wrote “I hope you will be quite pleased when you see the outcome”, I still thought “o.k., let’s see and don’t be to optimistic...” but your document is “WW0WOOOOOOOOOOOOOOOOOOOOOO W!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!! !!!!!!!!!!. Could you do a short presentation about that at our clausure? Daria, what do you think about that - and have you read this new bestseller? Kind regards, Leo

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EVOLUTION OF CR IN HAUSKA & PARTNER GROUP

WHAT IF LEO WERE NOT SO PATIENT? A glimpse from Leo

Patience is easy to exercise if there is a goal you want to achieve. It is also easy as soon as you realize it is more up to you and that it is your own task to encourage others to share your ideas. So maybe it’s not the patience at all. And maybe it would be even wrong to just be patient. Because that could mean you already know the expected outcome and are just waiting for your colleagues achieve what you have defined beforehand. But that’s not the way we should work. If you want to have shade in your garden and therefore you plant a tree - you might be impatient all the time until

your tree has grown to a satisfying size to fulfil its purpose. In this case it might be better just to buy an umbrella. But if you want to have nature in your garden, if you want to have a green environment, if you want to have colours and then you plant some trees and flowers and you do just everything what you can to support these plants - then you do not need patience, but you will sooner or later enjoy something that you have never expected. You will be surprised because that what you see and get is unique. And then you are in the position to say “Wooow!” - and then it’s up to you to be thankful for that. What I herewith am doing to you, Andreja.

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HAUSKA & PARTNER CR REPORT

THERE IS NO SUCCESS UNLESS WE PERFECTLY

understand EACH OTHER

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CONTENT

2 / SCOPE OF THE REPORT

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HAUSKA & PARTNER CR REPORT

2 / SCOPE OF THE REPORT

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We find it quite difficult to maintain a balance between the pressures of daily work and our commitment to live CR in every aspect of our operations. We were quite realistic about our capabilities when we said we can make our CR journey possible only if we take one step at the time. That is how we decided to start with ourselves by turning ourselves inside out, to make our organization more sustainable and to speak about it. Gradually, in each subsequent year we will report on a new area. This time our report is dedicated to our employees. With the second report, we will also report on our market impact. In the third year we plan to tackle environmental issues, and we have reserved the two last reports for community relations and research and development.

zational change built around our people, and not the other way around.

We are not reporting about our organization because we want like to produce just another stack of paper. We want to report because we have given our employees a greater say in the future of the organization they work for. We are reporting because we want to show our clients how we become “the right people”: assertive, with exemplary communication skills, a good understanding of people, processes and situations, creative, but with solid general knowledge and culture, able to adapt to every topic and ultimately, great networking skills. We also report because we would like to use the reporting framework for dialogue with everyone and for organi-

In Croatia, we cooperated with the UNDP Resident Representative Office in Croatia, which supports the government’s efforts to join the EU by raising awareness and building the technical capacity of Croatian companies to implement CR practices. In Serbia, we worked with SMart Kolektiv, an organisation that advocates responsible business practices and sustainability. In Austria, we talked about CR management with the director of respACT Austria, an association that provides support to companies on their way to sustainability, and about flexibility with Irene Kernthaler-Moser, specialist in the field of Work-Life-Balance.

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Our gradual “phased in” approach is slightly different than the one prescribed in G3 reporting framework. In the preparation of this report, we have primarily focused on profile disclosures, some economic performance indicators, some labour practices and decent work performance indicators that, in our view, were most relevant to report on in our first CR report. In addition, we have engaged some of the stakeholders in the preparation of our CR report by providing a platform for discussion of our work related practices, helping us identify strengths and weakness, areas for improvement and areas of best practices.


SCOPE OF THE REPORT

We also sought external assurance for the report from ethics etc., an independent sustainability and social accounting consultancy and assurance provider. Our report provides information for the 2005 fiscal year and other relevant information for the 2005/2006 calendar year. All Hauska & Partner Group

countries are included in the report except Latvia. The consultancy in Latvia is not included in the report (although the Latvian representatives participated in the World Café discussions), because it only recently started operating under the Hauska & Partner name and still needs to fully align with all of our Group’s standards.

On CR management with respACT Participants:

Roman Mesicek, Managing Director of respACT Leo Hauska, Annette Märk

respACT austria - an association for encouraging corporate social responsibility - is an Austrian platform that provides the information and support needed by companies on their way to sustainability. The union is a reliable partner for all questions of sustainability, Corporate Responsibility and business ethics. In the framework of its CR-management, Hauska & Partner organized an expert interview with Roman Mesicek, Managing Director of respACT, to ascertain the requirements small and middle-sized enterprises (SMEs) should meet in their CR management. What follows are important excerpts from the interview: Question: How should SMEs deal with the challenges of CR management? Mesicek: Our first expectation is that SMEs should be active with respect to this as they have done so far. My personal requirement is that SMEs should communicate more dynamically about existing activities and make it more structured and process-based.

Question: In respACT’s opinion, is there a minimum requirement that SMEs should accomplish in order to be able to implement CR management in company structures? Mesicek: A minimum requirement is that SMEs should deal with the issue in a strategic manner. Many SMEs operate in line with the principles of social responsibility, without having to implement a strategic approach. It is not necessary to implement a management system designed for big companies. The point is to put a management system into practice. However, this is a very difficult criteria for many companies. Presumably, it is even easier to state that different projects in the fields of environment, workplace, etc. are enough to be socially responsible, but this does not correspond to our understanding of CR. Question: Are SMEs and global companies confronted with the same requirements? Mesicek: For me, CR strategically means a commitment in which the company demonstrates its willingness to deal with an issue in a superior fashion. However,

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HAUSKA & PARTNER CR REPORT

corporations should not perceive it as a short-term process in which changes should be made quickly and measures should be implemented in all fields of CR over a short time. It is more a longterm strategic approach, and in this respect our advice is to implement it successively. Identification of stakeholders and organization of the initial stakeholder dialogues are a very appropriate starting point. Afterwards, the corporations should begin evaluating different indicators. Question: With reference to CR reports, what would respACT recommend or require for SMEs? Mesicek: Basically, if it were up to me, I wouldn’t require a company to produce a CR report. It takes time and effort that is not necessary in my opinion. However, if such a report should be elaborated, it should be geared to particular standardized guidelines. The general practice has shown, however, that these are designed mainly to suit the reporting needs of larger enterprises, so it is difficult to adapt it to the needs of SMEs and their reporting requirements. It is therefore advisable to create a shortened form that can be easily handled. In general, I would highly recommend the GRI guidelines. They are recently the best orientation framework and therefore many companies refer to them.

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Question: Which stakeholder groups should SMEs integrate in any case? According to the respACT understanding, the process starting from acquiring stakeholder information up to collaborating and addressing issues of common interest that have an impact on both us and stakeholders. Mesicek: With reference to involvement, this is a question of effective dialogue. Simply releasing information is not enough and therefore there should be an option for stakeholders to give feedback or to bring in content. Many companies are afraid of approaching stakeholder groups in this way, because it often leads to criticism. It should be mentioned that stakeholders are expected to demonstrate a level of professionalism. Therefore it is important that both sides try to establish a constructive dialogue that should be realized again successively. Question: What is the most important requirement concerning the recent situation in Austria to professionalize CR for the future? Mesicek: My general requirement is to further professionalize the discussion concerning the topic of CR, involving everyone: companies, politics, NGO’s. The point is to expand the issue of CR and to enable and facilitate an active academic discussion in Austria.


SCOPE OF THE REPORT

PROFESSIONAL STANDARDS AND CSR RECOGNIZED A note from UNDP Croatia

Having reviewed the relevant documents submitted by Hauska & Partner on the process of development and incorporation of the company’s CSR program, I would like to note the following: 1. The Process It is quite obvious that the process of CSR program development was quite comprehensive, and based on extensive cutting edge knowledge in the CSR field. Several items are particularly noteworthy: The process included a clear definition of the business case for H&P’s engagement in CSR, with an excellent understanding of how CSR internal processes would help accomplish the company’s strategic goals. The process was a comprehensive one, involving all employees. Employee engagement in the development of strategic initiatives and policies is in fact one of the most valuable features of H&P’s approach to this effort, as reflected in the quality of both inputs and outputs. Consultations were followed by the rapid establishment of implementation procedures, demonstrating an earnest commitment. Based on the information contained in the submitted documents, I see no apparent shortcomings to the process employed in development and incorporation of the CSR policy, I would commend it highly, and I recommend the continuation of the consultative process initiated during the present exercise. 2. The Focus Having reviewed the possible areas of CSR engagement, H&P has decided to

focus the first phase of its CSR program on a clear priority area for a multinational consulting company, i.e. its employees. Employees bring the most value to H&P business operations, and workplace issues are, therefore, well recognized as directly relevant to the company’s performance and ambitions. Another clear advantage of setting the workplace as a priority area for the CSR program in this case stems from the fact that it represents an area in company’s immediate sphere of influence. Based on the outputs of the consultative process, two additional sets of issues have been identified as relevant: Issues related to the marketplace, i.e. to the general and sectoral business environment in which H&P as a company and its employees do their daily business. H&P should certainly continue its present efforts in being recognized as the leader in professional standards and CSR, and work with others in promoting the aforementioned standards within the industry. I would not necessarily suggest this as the very next area of intervention, as these are weighty and difficult issues for a relatively small company to tackle on its own. Based on some responses in the workplace area, especially those pertaining to the outfitting, equipment, and appearance of work spaces, possible involvement with the environmental field suggests itself. I believe this to be relevant also from the standpoint of the obvious value H&P employees place on being able to be proud of the company. I would, therefore, like to turn your attention the Green Office Initiative. This has an additional possible advantage of 19


HAUSKA & PARTNER CR REPORT

being fun to implement, in a way that involves employees once more. 3. The Substance (Materiality) As listed above, it is quite clear that employee/workplace issues were very well chosen as the primary focus of H&P’s CSR program. Also, I find it highly commendable that the outcomes of the consultative process were immediately incorporated into the company’s business processes by becoming a part of newly developed corporate documents: Rules of Procedure and Code of Conduct. In my opinion, the consultative process has clearly identified three specific groups of issues affecting employees, as follows: Professional education, including the need for specialization and development of teamwork Values, including the creation of a common understanding of company values in a multicultural setting, their incorporation in business processes, and their internal and external communication Workplace issues, particularly flexibility of work arrangements The Code of Conduct constitutes a serious attempt to deal with issues related to company values. It lays down a clear and transparent framework to orient current and future employees, in both general and practical terms. In view of the overall consultative nature of the process so far, I would suggest that an appropriate time slot be set aside for joint discussion of any issues that may emerge from the implementation of the Code - annually at a minimum - at any relevant forum where H&P employees meet. This should be an informal and non-judgmental event, where each employee could discuss potential questions and/or doubts with his/her peers. The results of these meetings may help

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clarify, amend, or add new items to the Code, and make it more applicable and relevant to everyday practice. The Rules of Procedure (By-laws) respond substantively to workplace issues identified by employees, and regulate the rights and obligations of all relevant parties. The fact that an effort has been made to align its provisions with EU legislation, and with conventions and recommendations given by various international bodies, is particularly noteworthy, as is the fact that a labour law expert was consulted in the process. In view of the importance the employees have placed on flexible working arrangements, and work/life balance, I would recommend that this issue be revisited in a year’s time, to review whether the Rules have brought about a substantive change. The issue of professional education, specialization, and teamwork arrangements will require comprehensive strategic discussions, followed by adjustment of organizational arrangements and HRM interventions. As the definition of a key set of skills and knowledge for H&P employees is already listed in the submitted documents, that seems to be a fair starting point. Finally, employees have noted that the nature of the work does not give them sufficient time to spend on wider strategic issues, related to either their everyday work/industry, to social trends relevant to their work, or on mid- to long-term issues. A once-a-month brainstorming session could be scheduled in this respect in individual country offices, where each employee would be entitled to submit an issue for joint discussion, and all employees could possibly vote on which one is to be discussed.


SCOPE OF THE REPORT

PRACTICE WHAT YOU PREACH The note from SMart Kolektiv

Introduction At the very beginning, it is important to stress the importance of the initiative taken by Hauska & Partner. H&P will be the first PR and communication agency, particularly in the SEE region, to adopt a systematic approach in its CSR practices, especially in the sphere of employee relations, and to issue their first CSR in the Workplace Report. This example of good practice is not only noteworthy for Hauska & Partner, for it also represents an incentive, a role-model and eventually a harbinger of tendencies where attitudes in CSR in this region are concerned. It is worth mentioning that H&P is a PR and communication agency offering consulting services to other corporate clients, some of which are key players on SEE markets. In this context, their pioneering effort certainly represents a significant incentive to other companies and certainly makes H&P competent to provide consulting services to their clients in this, as yet insufficiently defined, area. By incorporating CSR practices into their own business operations, H&P joins those institutions and organizations that are aware of the importance of sustainable development and corporate social responsibility and make a strategic contribution to development and greater implementation of this concept in the SEE region. The business case for CSR - CSR as a business case The concept of CSR should not be perceived as separate from an organization’s core business or as activities that are not integrated into its business

and financial success. CSR has to be perceived as a core component of doing business and as a method for matching social and environmental interests with the business and financial interests. In this context, CSR has to contribute to a company’s sustainability and its operations, and consequently it is important to note that the concept developed by H&P does contribute to business goals by integrating social concerns. Practice what you preach The report itself, as well as the entire development of CSR standards by H&P, puts this company in an active position of someone who not only consults “others” about the potential of incorporating CSR, but as a company that also has its own very high standards in this area and elaborate programs targeting employees, clearly guided by the values it promotes. CSR as a growing part of a PR agency’s portfolio The need for PR agencies, which are able to provide support to their clients to integrate CSR in their operations in an expert, professional and quality manner, is certainly growing. H&P will position themselves in this context and become a communication company of the future, with the ability and capability to provide multidisciplinary and strategic support to its clients in the sphere of sustainable development. By integrating CSR into the core of its own business operations, H&P has assumed the status of a professional and desirable partner in this area.

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HAUSKA & PARTNER CR REPORT

Better work / employees - better performance By involving employees in the process of planning, making and implementing key decisions about company operations, H&P created an atmosphere in which employees obtain ownership over the process of work and become more strongly motivated to contribute to further development of the company. The focus on creating optimal conditions in their work environment directly generates greater employee productivity and fosters higher motivation and loyalty to company itself. Consequently, the company gives its employees a framework and an opportunity to participate and contribute to something constructive, important and meaningful.

certainly justified. A company that depends on the capabilities, training and competence of its employees recognizes its workforce as a key resource and the most important stakeholder. On the other hand, the company itself does not have a significant impact on environmental pollution, is not present on the market among a broad range of consumers and does not have a large chain of suppliers and subcontractors, which leaves employees as a key CSR category and the work environment as a key issue and an area to be advanced by the company.

CSR as a competitiveness tool The fact that H&P is the first PR agency in the region to issue a CSR report gives this company a competitive edge over its competition, because it specializes and presents itself as an expert in this area. On the other hand, the company is specializing in an ethical and noble discipline, and thus ensuring its attractiveness to a motivated and quality workforce. H&P is a company able to attract professional employees for whom financial incentives are not necessarily always the first and foremost consideration. This fact is particularly important given that H&P, as an SME, has no possibility of competing with multinational companies and chains in this field in terms of financial strength and the benefits it can offer to its employees.

Methodology The very methodology and approach to the development of CSR practices in terms of work environment have been adequately designed and envisage involvement and participation of employees themselves in defining the best practices, needs and future programs on a responsible approach to employees. Participation, that is, inclusion of employees in the process of defining and planning new approaches in company management, is in and of itself a sound and responsible practice providing employees with the opportunity to become more closely acquainted with the very conception, values and goals of the company. Establishing a dialogue among employees and openness of management toward their needs creates an atmosphere of teamwork and gives employees greater ownership over realization of the company vision and goals.

Key stakeholder Taking into account the character of their business, the choice of employees as key stakeholders, i.e. choosing to integrate CSR practices primarily in terms of the work environment, is

It is important to note that the values and goals that a company promotes and on which it bases its human resource policy are an interaction and variety of employee cultures in different countries. The company culture defined in this way

22


SCOPE OF THE REPORT

contributes to the creation of additional values for the company itself and is particularly important for the SEE region in which H&P operates, given that a large part of the region is burdened by misunderstanding and conflicts among different national and cultural groups. Obstacles and shortcomings This series of recommendations aims to facilitate further development of H&P’s CSR activities and to present potential guidelines for development of corporate responsible practices. The recommendations aim to supplement already defined guidelines and programs where the latter have not been sufficiently elaborated, i.e. to present possible directions for further development of these programs in forthcoming years. Media Company employees themselves cited media representatives as important stakeholders for an agency such as H&P. Our suggestion would be to involve partners from media houses with which a company cooperates in its own CSR programs. Including media representatives in the dialogue about CSR and related issues sensitizes media representatives to this concept. Furthermore, education of media representatives on the importance of the notion itself and the important role played by the media in strengthening and developing CSR is an vital effort. In this way, H&P would establish even better cooperation with media representatives, but, more importantly, it would pave the way for initiating the process of raising awareness about CSR in the region, which would be impossible without cooperation with the media.

Clients The only way for H&P to decisively and positively influence its clients with regard to corporate responsible practices is to establish a more active dialogue and involve clients in these processes. In this way, clients obtain even greater assurance in the professionalism and depth with which H&P develop their programs, give their contribution to this process and finally transmit a part of their experiences and knowledge to the way they manage their own company. Employee projects In addition to establishing a dialogue and working with employees, in the forthcoming period it will be necessary to consider the even more practical and active engagement of employees on socially responsible projects. The goals set by the World Café and other programs can be attained in an even more proactive way by engaging employees on projects that make use of their knowledge and skills in order to contribute to socially beneficial initiatives. This primarily implies various forms of volunteer engagement of employees or their involvement in a series of local initiatives. These initiatives and programs must also contain elements of building and bolstering team spirit and participation of employees in dialogue on the future and values that characterize their company. One of the forms of such voluntary engagement of employees would be to provide consulting/PR support to a non-profit organization dedicated to a cause that employees find significant and stimulating.

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HAUSKA & PARTNER CR REPORT

EXPANSION OF

the

COMPANY INTEREST IS NECESSITY, NOT COMMODITY

24


CONTENT

3 / ABOUT HAUSKA & PARTNER GROUP

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HAUSKA & PARTNER CR REPORT

3 / ABOUT HAUSKA & PARTNER GROUP

Hauska & Partner’s history began in 1990, when Leo Hauska founded a strategic communications consultancy in Vienna. Recognizing the potential of emerging markets and guided by entrepreneurial drive, very soon he started expanding business operations to the region by developing a network of communications consultancies that form the Hauska & Partner Group. Hauska & Partner Group today operates in five countries: Austria (where its headquarters are located), Croatia, the Czech Republic, Serbia and Latvia. Hauska & Partner Group is also present in Bulgaria, Estonia, Hungary, Lithuania, Poland, Romania, Russia, Slovakia and Slovenia through partnership affiliates. Hauska & Partner offers a range of services to its clients. The consultancy is primarily specialized in strategic consulting and stakeholder relations. Other primary services include media relations, internal relations, external relations, public affairs, crisis and change relations, and corporate responsibility - a service introduced thanks to our growing competencies. Hauska & Partner Group consults reputable clients in a wide range of industries and sectors, from corporate, over national and local government bodies to international organizations. We have successful record in advising our partners in finance and banking, telecommunications and ICT, FMCG sector, health and pharmaceutical industry, energy, infrastructure and development, government organizations and ministries in several CEE countries and international organizations, such as OSCE, World Bank and some UN programs. 26

HOW “DISORGANISED” ARE WE?

3

Governance in Hauska & Partner Group basically rests with the Management Board. There are eight members of the Management Board, two each for Austria, Croatia and the Czech Republic, and one each for Serbia and Latvia respectively. The composition of the Management Board also reflects the common practice of Hauska & Partner Group accord preference to local managers - residents of countries in which we operate who also, with the exception of Serbia, share ownership in the company. The Board operates on the basis of regular meetings and decisions are reached by consensus. In addition to the Management Board one more formal structure has emerged at the group level at the beginning of the year. We call it the CR Working Group. It consists of senior representatives from all the countries and led by the CR Director. Soon after its establishment, the CR Working Group became a nucleus for establishing a consistent framework in which we will be able to intertwine and embed management of sustainability issues into overall corporate governance. The CR Working Group meets regularly to discuss open issues and current progress.


ABOUT HAUSKA & PARTNER GROUP

ORGANIZATIONAL STRUCTURE

Headquarters AUSTRIA

H&P Serbia

H&P Croatia

H&P Austria

H&P Czech Republic

H&P Latvia

MB Member

MB Member

MB Member

MB Member

MB Member

Dubravko MiholiÊ

Leo Hauska

Václav Pavelka

Srba JovanoviÊ

Daria M. Bartulin

Hedi Hauska

Märis Plüme

Petr Stoklasa

CR Working Group CR Director for H&P Group Andreja PavloviÊ

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HAUSKA & PARTNER CR REPORT

Our organization combines both flexibility and formal structure. It is a delicate balance since we are a entirely (100%) client-oriented organization. We have organized our work to meet the requirements and needs of our clients as effectively and efficiently as possible, regardless of the department involved. Thus our organizational structure follows keys processes, rather than the opposite. Yet, we have also realized that “our way of doing things” needs to evolve into more formal structures and processes in order to build an overall process management approach at the Hauska & Partner Group level.

our key business processes and improving our performance in the plan-docheck-act cycle.

For example, in Croatia we underwent the process of certification for two norms, ISO 9001 and SA 8000, in which we developed an integrated management manual alongside the key procedures required by both norms. With this we have created single reference point related to quality and work-related issues - an integrated quality and social accountability management system which will institute a robust framework for a systematic approach in managing

We have prioritized these two areas because we believe we need to organize ourselves more effectively in process and project management in order to be able to disorganize ourselves in other areas. We want to give our employees the means that will enable them to work more efficiently and exercise better time management, and by doing so ‘loosen up’ our organization in order to make it more humane and flexible.

28

Furthermore, following the Croatian Clausure, this year dedicated to process and project management, and the discussions we had there pointed to the necessity of organizing our work so that it more strictly complies with the principles of process and project management. Therefore, we have launched a new project that will design H&P Group project management guidelines with the objective of modifying the internal and external organization of work.


ABOUT HAUSKA & PARTNER GROUP

2005 FINANCIAL RESULTS The financial section in our first CR report gives an overview of the performance of the Hauska & Partner Group through its local companies in Austria, Croatia, the Czech Republic and Serbia. The effective date for all reported economic values in this report is 31 December 2005. As compared to the preceding year, the Group has seen an increase in revenues (+8%) from 32.42 million to 32.61 million for the 1 January 2005 - 31 December 2005 period. All reported amounts

are an aggregate of the respective individual amounts in the income statements of the local companies. Inter-office services have been deducted from revenues as well as costs. Operating costs account for 31.23 million, or 47% of revenues, personnel costs are 31.04 million (40%), and payments to suppliers of outside capital amount to 333,000 (1.5%). Tax liabilities, consisting of the income tax and other special taxes and royalties, add up to 375,000 or 2.9% of revenues for the period under consideration.

5 1000 Revenues (net sales plus revenues from financial investments, sales of assets)

2.616

Operating costs (payments to suppliers, non-strategic investments)

1.226

Employee wages and benefits (total monetary outlays for the workforce)

1.040

Payments to suppliers of capital

33

Payments to governments (gross taxes and royalties)

75

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HAUSKA & PARTNER CR REPORT

HAUSKA & PARTNER EMPLOYEES HOW MANY OF US THERE ARE That team consisted of 40 employees in four countries in the period from 1 October 2005 to 30 September 2006, 7 in Austria, 14 in Croatia, 16 in the Czech Republic and 3 in Serbia. Out of that number, three quarters i.e. 30 employees were women, which, we could say, serves as a proof of some opinions that public relations are predominantly a female profession. Most of our 40 employees are between twenty and forty years of age. Only one is between forty and fifty, while three are older than fifty. We consider ourselves to be quite a young, vibrant company.

Our profession often requires that we work a great deal. Nevertheless, we have well-delineated working hours that vary based on the specific requirements of individual markets and client needs. Generally, we start working at 9.00 am and finish at 5.00 pm, with the possibility of flexibility on either side of these core hours to better combine professional and private needs. Also, senior employees are occasionally allowed to work from their homes. We regularly and entirely fulfil all obligations to our employees. All our employees have full-time employment contracts and are registered with the Employment Bureau and Social and Insurance Office, which means all relevant contributions are paid for them in all situations regulated by law.

WHAT WE OFFER The H&P Group offers sound opportunities for career development. We do it in different ways - more traditional ones like internal and external training and education, and the less traditional ones like constantly challenging creativity and the competitive spirit through daily work. All of our employees are joint (company) members of the Public Relations Associations in their countries, which also provides various forms of training and seminars as well as good insights into industry practices and trends. In the case of the Czech Republic, employees are given additional education possibilities provided by the London School of Public Relations. Likewise, we offer some more intangible assets like working with energetic, enthusiastic and caring people in a positive atmosphere, where all employees can openly speak to their superiors and resolve issues together.

30

Even though our work is rather stressful, we have a low rate of absenteeism. Only 79 days in four countries, meaning less than two days per employee in one year. There was no absenteeism due by occupational ailments nor job-related fatalities. Hauska & Partner Group offers health and safety standards ranging from annual inspections of all the equipment used at the offices, information on hazardous materials and safety instructions, first aid kits, and supplemental health insurance (provided to employees in Croatia). With SA 8000 certification in Croatia, a senior management representative responsible for the health and safety of all employees was appointed. Annual vacation and other free days are specified either in the By-laws or in other internal documents. In all countries we provide an equal number of vacation days annually to all employees.


ABOUT HAUSKA & PARTNER GROUP

GENERAL EMPLOYMENT INFORMATION With reference to employee attrition, during the period from 1 October 2005 to 30 September 2006, eleven employees in four countries changed workplaces, setting the rate of employee turnover for the Hauska & Partner Group at 28 percent. Entry level salaries in Hauska & Partner Group companies, depending on the country, are 11 to 89 percent higher than

the legally prescribed minimum wage in each country. Over time, salaries grow according to personal performance indicators, 360 degrees internal evaluation and one-on-one discussions with the management. Regular performance and career development reviews are conducted regularly in Croatia and Austria. Reviews have been introduced in the Czech Republic in 2006, and they will commence in Serbia and Latvia in 2007.

Rate of injury per 100 employees

2.5

Days of occupational ailments per 100 employees

0.0

Lost days per 100 employees Days of absenteeism per 100 employees Number of job-related fatalities

197.5 0.0 0

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HAUSKA & PARTNER CR REPORT

GROWING BUSINESS

complexity IS WHAT ONE MUST EXPECT

32


CONTENT

4 / OUR HR PRACTICES

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HAUSKA & PARTNER CR REPORT

4 / OUR HR PRACTICES

All current practices that are primarily implemented in H&P companies in Austria and Croatia are listed here, while other companies in the Group implement only some of these practices. Since the process of alignment is under way, we expect each of the remaining companies in the Group to implement all HR practices by the time our next report is issued. Austria, as the company’s headquarters, and Croatia, as the country which joined the Group at the earliest stages, are closest in formulating all of these HR practices, which is why they implement them entirely. On the other hand, over time, as the companies from other countries joined in, they unable to adopt all of these HR practices immediately. This is why the alignment process is currently ongoing, to make sure all companies in the H&P Group follow the same practices with respect to HR.

34

4

One tool applied in all companies is Protocol, a database of daily working activities that all employees fill in on a regular basis. Protocol is primarily used to document the exact time we spend on each client and other projects in order to create a base for our billing procedures. It is also used to monitor, analyze and evaluate an employee’s time invested compared to the quality of work, needs of the company and opportunities for employee development. This is also one of the tools used to measure employee productivity.


OUR HR PRACTICES

IN SHORT 360 degrees evaluation An HR tool primarily used as for evaluation tools in H&P’s HR system. It is an all-around assessment in written form in which all employees participate by equally evaluating one another. The results are presented in a plenary session once a year and in a more detailed manner during one-on-ones. 360 degrees is used to make PDP’s more precise and is one of the indicators for decision-making on promotions and salaries. Workplace Assessment The WA survey is conducted among all employees and management, covering about 50 questions based on those topics most crucial to internal development. It is used to verify, evaluate and revise management practices, internal communication, education and personal development, workplace conditions and overall workplace quality, and to assess the potential gap between proclaimed standards and corporate culture and actual employee perceptions, understanding and thinking. Results are presented in a plenary session once a year and management presents the resulting conclusions and measures that are incorporated into the business strategy based on WA findings. One-on-ones The basic one-on-one between the MB member in charge of HR issues and

each employee takes place once a year. During this conversation, the MB member presents the employee with all of his/her performance indicators during the past year. They jointly discuss set objectives compared to actual achievements. The details of 360 degrees and client input are also discussed. The immediate result of the one-on-one is the defined yearly PDP. Personal Development Plan (PDP) The PDP is a tool we use to continually plan each employee’s development within the framework of company’s needs, requirements and organizational development. They are written documents in which employees and the MB member in charge of HR agree on set objectives for the employee during a year, and the strategies and particular activities needed to achieve these objectives. Protocol Protocol is a database of daily working activities that H&P employees are obliged to fill in on a regular basis. Protocol is primarily used as a tool to document the time we spend on client work in order to create a base for our billing procedures. It is additionally used to monitor, analyze and evaluate employee time invested compared to the quality of work, company needs and opportunities for employee development. It is one of the tools used to measure employee profitability.

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HAUSKA & PARTNER CR REPORT

Academy

New employee orientation system

The annual plenary conference organized by the H&P Group for all employees has two primary functions: strategic and educational. Over several days, employees participate in theoretical and practical sessions concentrating on corporate culture, education in core business, new developments, best practices, etc. The Academy is opportunity to wrap-up the year at the Group level and work on Group harmonization.

New employees are introduced to the company by specific procedures that initiate them into the corporate culture, processes, projects, internal development, organizational aspects, rules and procedures and other parts of their daily work. An essential tool in this process is the brochure for new employees.

Clausure Clausure is a strategic and educational seminar geared to the specific purposes of each local office held once annually for participants from one country team. The content of the Clausure is mostly concentrated on internal development, strategy development and team building. True Professional True Professional is a system that presents H&P philosophy through a number of steps. True Professional principles are the core objectives and strategies that inform employees on what H&P deems “true professional”, and instructs them how to reach desired levels.

36

Recruitment of new employees The recruitment process is prescribed by set procedures and proceeds in several selection stages. We use two methods to contact potential employees - our own internal database of potential employees and publicly posted job offers. Internal Communications Internal communications are conducted in writing and verbally. Management regularly informs employees of practical decisions via e-mails and regular meetings. Internal communications are also exchanged on the Intranet.


OUR HR PRACTICES

TRUE PROFESSIONAL The “total team” philosophy in practice

In football, Total Football is a system where a player who moves out of his position is replaced by another from his team, thus retaining their intended organizational structure. In this fluid system, no footballer is fixed in his or her intended outfield role; anyone can be a striker, midfielder and defender in succession.

Total Football depends largely on the adaptability of each player on the team to succeed. It requires extremely tactically aware players, allowing them to change positions at high speed - in its simplest terms, every player is comfortable in any other position. It also places high technical and physical demands on the players.

In Hauska & Partner, the Total Football philosophy has become the Total Team Philosophy.

I am my team. - We work together - We respect our strengths and overcome our weakness - We are proud of every team member - We take the best from each team member - We are open and honest in our communications - We find inspiration in our successes and learn from our mistakes

DEVELOPING OUR PEOPLE We use three key tools for planning our employees’ careers in the H&P Group. At the end of each year, we conduct a 360° evaluation, all-around checks in written form in which all employees participate equally by evaluating one another. The results of the 360° evaluation are presented to all employees and used as the basis for two other tools - Personal Development Plans and Oneon-One discussions with the Managing Board Member in charge of HR.

The Personal Development Plan (PDP) is a tool we use to continually plan the career path of each employee in the framework of the company’s needs, requirements and organizational development. After submitting the PDP, the employee has one final step to take - the one-on-one interview with the Management Board member. During this conversation, the MB member presents the employee with all of his/her performance indicators during the past year. They jointly discuss set objectives compared to actual achievements, as well as the details of 360° and client input. The immediate result of the one-on-one is the defined yearly PDP.

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HAUSKA & PARTNER CR REPORT

IMPROVING OUR WORKPLACE Having gone through the process of initial assessment, we realized that we needed to establish framework for responsible business practices and define a code of conduct alongside mechanisms which would help us assess the potential gap between proclaimed standards and actual employee perceptions and actions. This is how the workplace assessment survey was developed and introduced for the first time in Croatia within the H&P Group. This was one of the elements we used to develop our own platform for employee dialogue. The workplace assessment survey is a monitoring tool used to make sure our

daily practices comply with our proclaimed values and standards. With this survey we also upgraded the employee PDP system by providing another way of checking the reliability of employee statements in the PDP. This serves as an employee consultation tool, which is why it does not classify as a standard satisfaction survey. Once all companies in the H&P Group implement the WA survey, it will also serve as a benchmarking tool among the companies. After the second WA survey is conducted in Croatia in 2007, we are going to develop key performance indicators (performance objectives) based on the results of the survey, and weak points that need to be addressed.

GRADATION

1.0 - 1.5

area of excellence

1.6 - 2.5

area of strengths

2.6 - 3.5

area of necessary improvement

3.6 - 4.5

area of obligatory improvement

4.6 - 6.0

“red alert” area - company risk - immediate action

SURVEY RESULTS: Areas of excellence (1.0 - 1.5) - Stability and reliability of employment - Reputation among stakeholders - Trust in H&P leadership - I enjoy and am proud to work at H&P

1.4 1.5 1.5 1.5

Areas of strengths (1.6 - 2.5) - Employees are respected and valued as persons - We speak positively about H&P to others - We do important work and are generally satisfied

1 .6 1.7 1.8

38


OUR HR PRACTICES

-

Management provides a clear direction Management is interested in the well-being and professional growth of employees We are independent and have sense of accomplishment Individual visions blend with the visions of company Differences can be discussed openly Skills and abilities are well-used H&P improves workplace quality We are satisfied with career perspectives at H&P

1.8 1.8 1.8 1.9 2.0 2.0 2.0 2.0

IMPROVEMENT -

We are satisfied with our status and allowed to balance life and work We are kept informed and consulted, our ideas are taken into account We enjoy good fringe benefits We have essential materials and are satisfied with our involvement We are satisfied with holidays and free days

2.3 2.4 2.4 2.4 2.4

Areas of necessary improvement (2.6 - 3.5) - Our professional development - Formal communication with management - Level of technology - Workload and working hours - Salaries - Offering competitive opportunities and taking care of talent - Communication with team leaders - Our training and education

2.6 2.7 2.8 2.8 2.9 2.9 2.9 3.1

Area of obligatory improvement (3.1 - 4.5) Red alert area - company risk - immediate action (4.6 - 6.0)

none none

What we consider most important: 1. Team atmosphere and bonding 2. Salary increase 3. Possibility of professional promotion 4. Insight into company strategy and plans 5. Possibility of involvement in company management

143 pts 136 pts 130 pts 1 1 9 pts 1 1 7 pts

Followed closely by: 6. Openness of communication 7. Educational opportunities 9. Opportunity to be innovative and creative 10. Flexible working hours 11. Opportunity to work on international projects

115 pts 1 1 3 pts 1 1 1 pts 9 1 pts 90 pts

Low priority: General workplace, free days, fringe benefits, educating others, training and mentoring range:

65 - 44 pts

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HAUSKA & PARTNER CR REPORT

THE FUTURE

of

OUR BUSINESS IS WORKING TOGETHER AS ONE TEAM

40


CONTENT

5 / SHAPING OUR FUTURE

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HAUSKA & PARTNER CR REPORT

5 / SHAPING OUR FUTURE

Until 2006, the primary objective of our Academies was to provide our employees with new knowledge in the areas we deemed necessary. This time we wanted to turn it into a platform on which the management and employees would jointly work on shaping the future of our Group. The CR Working Group decided to provide the platform for open employee discussions by organizing the World Café, which was set in a stimulating café-like environment to additionally encourage our employees to share their views about the Group’s future. Moreover, the idea was to foster a better understanding of our strategy, values, CR and workplace related issues and stakeholder relations. This was an ambitious goal because we did not know how employees would react to suddenly being invited to speak out about the issues which were usually not discussed in such a wide circle.

42

OUR FUTURE IN THE WORLD CAFÉ

5

The World Café is both a simple methodology for creating a living network of collaborative dialogue around issues that matter in corporate, governmental and community settings and a provocative metaphor. Based on a simple principle, the underlying idea of the World Café is to serve as a platform for sharing knowledge, creating collective intelligence and contributing to the elaboration of new value-chains. The World Café at our Academy was also an opportunity to bring together all employees, enabling some of them to meet their colleagues from other countries for the first time. Namely, it was the first time employees from Latvian and Serbian companies joined our Academy and met the rest of the Group. The World Café at our Academy was organized around six topics, with groups of employees sitting at small Café-style tables and background music to create the café-like ambience and add on to the informal and easy-going atmosphere. Each discussion table had a paper table cloth for writing the ideas and thoughts down as well, as a host who moderated the discussions. Before beginning, all participants were asked to adhere to Café-Etiquette.


SHAPING OUR FUTURE

We need to present CR at the Academy to all of our people, but we need to do so in a way that encourages them not only to participate in discussions about Hauska & Partner’s future, but also to actively shape it. Petr Stoklasa, Partner

The six topics discussed were: 1. What is CR and how does it relate to H&P? 2. Do our values fit into our daily work? 3. What is the link between PR, CR and stakeholders relations? 4. What is our corporate strategy? 5. Which skills are needed to support our strategy and growth? 6. What should the ideal workplace look like? Analyzing the upshots from the different theme-discussions at the World Café, we observed some of the main trends in the way our employees see them. Evaluating their ideas and way of thinking, we obtained a rather good idea

“World Cafe is a dynamic and witty form of conducting employee dialogue that enables employees to freely and openly express their views and opinions on the company they work for. Employees are invited to share their suggestions, complaints, concerns, worries, hopes, and expectations of company. Because of the relaxed and pleasant atmosphere, all barriers and hierarchy differences cease to exist. “I recommend that this kind of opinion sharing/viewing should also be practiced with other important stakeholders

of the direction we will take in the future by implementing our CR and HR policy: - raising awareness of H&P Group strategy and objectives by intensifying our internal communication process and establishing a consistent H&P Group CR-framework, - implementing a different kind of thinking and education based on employee and client needs, - defining working values and establishing a common understanding of key skills and issues, as well as establishing multidisciplinary and cross-border teams in order to highlight the intercultural values and know-how transfer, - defining a set of H&P unique workplace standards. in order to verify the company’s current status -this is an excellent tool for measuring impact and satisfaction of the key stakeholders. Thanks to the synergy of ideas from people from somewhat different countries, customs and cultures, new ideas emerge, which makes World Cafe a significant brain-storming tool. In addition, World Cafe is especially suitable for defining the corporate philosophy - developing a common vision, mission statement, and values.” Gordana VesiÊ, consultant in Hauska & Partner Serbia

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HAUSKA & PARTNER CR REPORT

BECAUSE OF THE RELAXED AND PLEASANT ATMOSPHERE, ALL

44


SHAPING OUR FUTURE

BARRIERS AND HIERARCHY DIFFERENCES CEASE TO EXIST.

45


HAUSKA & PARTNER CR REPORT

Based on the World Café outcome we have already managed to improve our workplace in two fields. First, we developed a detailed employee brochure that should help the newcomers more easily familiarize themselves with our way of doing business. This brochure also pro-

vides uniform guidelines with necessary information about our company, our policies and procedures. Second, since employees recognized diversity as one of our distinctive strengths, we have also added it to our values.

“The idea and concept of World Café were excellent. Out of everything in the last Academy, World Café was the best part. I think everybody was relaxed and managed to talk with their senior colleagues about current topics and possible open issues in an informal and

slightly amusing atmosphere. World Café was a pleasant surprise for everybody and it should be repeated at the following Academies.”

SHOULD WE NOT STRIVE TO BE BETTER THAN THE BEST? Hauska & Partner’s values, as we know them now, emerged as a result of the Corporate Identity/Values Workshop held at the Hauska & Partner Clausure in April 2005 as a part of an overall project activity that was listed in the CR strategy and program the year before.

Miroslav Brnjak, assistant in Hauska & Partner Croatia

The list of proposed values was a product of past values and the Hauska & Partner reality. In the same way they were instrumental to Hauska & Partner’s philosophy and strategy. The values proposed were excellence, reliability, contribution, passion (dedication) and diversity. In the process of verification and selection all value were selected by workshop participants except for one: the value of diversity.

The workshop was organized with the purpose of defining one of the fundamental elements of the Corporate Identity - our values. Prior to the workshop, all participants from Austria, Croatia and Serbia were given a brief paper in order to ensure that they all share the same or similar understanding of Corporate Identity elements and use the same vocabulary in workshop discussions.

Hauska & Partner values were again discussed in a wider forum at the Hauska & Partner Academy which was held in May 2006. In the World Café round-table discussion, one of the topics discussed was whether our values fit into our daily work. Participants underlined excellence and reliability as main the pillars of the Hauska & Partner corporate culture.

The brief paper laid down the Hauska & Partner values with their basic explanations and definitions. Some examples of practical implementation of values in daily work with our clients and business partners were also given.

They also placed special emphasis on diversity. As a consequence, this value was re-introduced as a Hauska & Partner value that enables us to equally appreciate our similarities and our differences.

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SHAPING OUR FUTURE

Hauska & Partner values: Excellence

Reliability

We constantly strive to provide the best consulting and incorporate the highest standards and best-developed skills into our daily actions. Excellence reects constant growth in knowledge and leadership in action. This means that:

Our behaviour means we deserve to be trusted and entrusted with assets and intangible values. We value stability and act in a way that provides protection, help, advice and consultancy so that we take into the account our stakeholder rights and interests. This means that:

-

-

-

-

We employ people who constantly wish to develop professionally and who contribute to excellence Our team demands respect for the highest standards of quality We invest in our growth, development and raise our competence daily We provide tailor-made solutions to our clients that best assists them in achieving their business goals We are innovative and contribute to the development of our profession

-

-

-

-

We fulďŹ l our responsibilities to our employees, shareholders, clients, society and other stakeholders Our employees can rely on the company and their colleagues for stability of employment, income, professional growth and challenging work Our clients entrust us with their problems and issues and believe in our capabilities to help them solve these issues and achieve their business goals We have a responsible attitude toward our profession, our community and society

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HAUSKA & PARTNER CR REPORT

Contribution

Passion and Dedication

Our purpose is to provide the best consultancy to our clients, safe employment to our team and a sound framework for their professional development, prosperity to our shareholders, tangible and intangible benefits to society, constantly adding value, scope, quality and strength. To contribute means to give by adding quality and value. We are dedicated to:

We believe that the best consultancy, besides vast knowledge and skills, has to cultivate the elements of passion and strong belief. It includes a dedicated approach to people and things and a full commitment to clients, stakeholders and issues attached. Passion and dedication mean additional energy invested in our work, greater attention to the issues, better identification with clients and greater loyalty.

-

-

-

-

48

Contributing to our clients’ wealth, not only by providing excellent service levels, but also by reaching further and proactively coaching, teaching and educating clients in our domain of expertise Contributing to our employees’ quality of life, by allowing them to achieve their highest potential, respecting their professional ambitions and providing a healthy, desirable environment for their daily work Contributing to the quality of our profession with innovation, business development, fair and sound practices, investments in education and by facilitating market development Contributing to the values of European society and good practices, not only by being a role-model in observing regulations and laws, but going farther and responding to the needs of society wherever communications consultants may add value

-

-

-

-

-

We are passionately devoted to our profession, our company, our team, our clients and the positive issues we promote as consultants Our work goes beyond the simple need to have a job and secure our existence; we approach our philosophy and our actions with full dedication We firmly believe in our values and vigorously exercise them in our daily business We approach our stakeholders with the desire to understand them and to share our values with them We are fully devoted to our clients and committed to their success


SHAPING OUR FUTURE

Diversity We equally value our similarities and our differences. We recognize that we all come from different cultural and social settings and therefore we exert efforts to understand each other and merge diverse experiences and knowledge to build a strong network of people who work together as one team. -

-

-

-

Our vision and mission were revised again in 2006, when the MB members were simply asked to write down their vision and mission for Hauska & Partner. When all the vision and mission statements were merged, we realized that all MB members have pretty much the same understanding of our direction.

We cherish the qualities that help us understand, accept and cultivate differences We believe that with a diversity of ideas, background and perspectives, our employees make it possible for us to develop a more complete picture and better adapt to the complexities and challenges of the modern word We are fully aware that working in a diverse team can be more difďŹ cult because we confront different and often contradictory perspectives, and yet we strongly believe that working in diverse teams helps our employees be more open and develop new approaches We respect diversity in society and make every effort to understand and accept each stakeholder and group, and we are dedicated to brining different perspectives together

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HAUSKA & PARTNER CR REPORT

VISION: A regional leader in strategic consulting and stakeholder relations respected for creating value for our

clients and partners and contributing to positive changes in the business community and society as a whole.

By “creating values” we mean: -

-

-

-

Helping an organization, company or an individual not only achieve the business and organizational goals, but also surpassing them Helping an organization, company or an individual achieve or surpass planned profits Helping an organization, company or an individual establish, develop, maintain and enhance complex and/or not solely financially measured values, such as reputation, image or brand value Helping an organization, company or an individual establish, develop, main-

-

-

tain and enhance sound relationships with their stakeholders, which has measurable effects on success in any area of operations Helping an organization avoid and prevent unwanted problems or issues that may influence the financial or non-financial value of their operations Helping an organization, company or individual conceive, plan and implement strategies and activities that directly reflect the long-term sustainable existence of the organization, company or individual in terms of relations with their crucial stakeholders, such as employees, customers, shareholders or the community

MISSION: -

-

50

By employing and developing top professionals, we provide the highest quality of consulting to our clients and help them achieve their business and strategic goals. We promote the highest standards and responsibly contribute to the communications and consulting profession, which makes us a reliable and preferred partner to our stakeholders.

-

-

We work with respectable companies and by engaging in positive change we contribute to the development of society. We help improve the business community in our home countries and advance international cooperation and understanding. We are a stable, efficient and profitable company with excellent knowledge management providing a great workplace for our employees and investment satisfaction to our shareholders.


SHAPING OUR FUTURE

BUILDING UNIQUE WORKPLACE STANDARDS We operate in different countries with different labour standards and legislation. For instance, Austria has already been a member of the European Union for many years, while the Czech Republic only recently joined. On the other hand, Croatia is a candidate country going through number of alignment procedures, while Serbia has yet to start this process. One of the major problems Serbia has been facing over the last several years is the continually growing unemployment rate and unregistered work. Moreover, few employers work in full compliance with the law and breaches of employee rights are common among most companies. CR is still an unrecognized concept in Serbia and is practiced only by major multinational companies and very few local ones, mostly through donations and, to a certain degree, environmental protection initiatives. Labour issues grew in importance over the last several years in the Czech Republic. The social peace is maintained by an institutional platform for social dialogue between the government, trade unions and employers. Labour law is fully aligned with EU legislation and enforced in the Czech legal system. Labour issues are acknowledged as important by both the media and society in general. The main labour issues include occupational safety and health, unemployment, work-life balance, workplace discrimination, gender differences and equal opportunities. International Business Leaders Forum Prague (IBLF) conducted a survey which showed that the motivation for company CR activities most frequently often entails creat-

ing an image of a preferred employer to more easily attract and retain quality employees. According to a European Commission Opinion, Croatian legislation seems to cover most of the basic principles laid down by EU Labour Directives, especially in areas such as informing and consulting employees regarding individual employment conditions. On the other hand, experts underline that the Croatian economy cannot advance further without major improvements in the labour market, because it will lose its competitiveness and become disadvantaged in comparison to other countries. As most important, they mention investments in human capital through education reform and development of a knowledge-based economy that would ensure a competitive workforce and reduce unemployment. As in the case of the Czech Republic, media and society pay signiďŹ cant attention to labour issues, out of which the most important are unemployment, overtime, unregistered work, work-life balance, mobbing, salary discrepancies based on gender and managerial positions. Overall, we have witnessed profound shift in public interest from unregistered work and compensation and beneďŹ ts issues to health and safety issues, gender equality and quality employer issues. When it comes to Austria, there are number of a governmental bodies responsible for labour issues, as the Austrian labour framework is very complex. In all decision-making processes, partners representing the government, business and labour jointly resolve all open issues. The issues that are mostly addressed by the media and society are exible working hours, teleworking

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and work-life balance in general, equal opportunities, childcare, and health and job security issues. Since we work in different environments, we also have different preferences and a differing ideas of what the ideal workplace should look like. We are also aware that we cannot offer our employees the same benefits as our competition or large companies. That is why we have opened discussion with our employees about issues that are of greatest interest and concern to them. At the same time, we are also aware that once we initiated discussions with our employees, we could also be expected a certain level of disagreement between employees and management with respect to some issues. It is therefore essential to make sure employees feel free to openly discuss workplace related issues with management. World Café discussions were the first step in establishing a common understanding between management and employees about what employees can reasonably expect from the company and vice versa and how to constantly improve our workplace quality. In the same manner, we will continue discussing open issues with our employees, thus setting our workplace standards which would make us a first choice company.

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Flexibility in the focus In our CR Working Group discussions, one of the issues tackled was the fact that in comparison to some of our competitors or multinational companies, we are not able to provide them the same level of competitive salaries and benefits. We perceived this fact dually, both as a threat as an opportunity, as on the other hand our employees indicated that they expect more balance between their work obligations and private lives. In this regard, we have recognized the importance of work flexibility and worklife balance. Even though the practice of creating a flexible work time company is still at its beginnings in our Group, we plan to make a shift in this area in the coming period. In order to make a positive step towards flexibility, we are seeking professional knowledge and expertise in this segment, which is why our company in Austria consulted Irene Kernthaler-Moser, a specialist in the field of work-life balance. Irene Kernthaler-Moser underlined that before we could start developing our flexible working model(s), we have to define what the notion “peak performance” means to us. She used this notion in the context of results of research carried out by Fritz Riemann. According to this research, there are four different types of behaviour present in every person in different forms. These four types of personal behaviour have different result, process, person and innovation patterns. They are considerably more effective if management is able to combine them well in teams and recognize the quality of particular performance. Here it is also important for management to realize there is no


SHAPING OUR FUTURE

single person who can constantly generate “peak performance” and that it is management’s task to define the stages in which every employee will be allowed to recover and prepare for the next peak performance. In order to facilitate easier introduction of the work-life balance scheme in Hauska & Partner Group in the following years, we plan to organize an educational seminar and a discussion forum for our employees with Ms. KernthalerMoser in 2007. The goal is to open up discussion about this issue and thus facilitate the establishment of more flexible working models which will support work arrangements suiting both, the company and the employees. By initiating discussion with our employees, we want to encourage a partnership approach to meeting the needs of the company and employees.

PARTNERSHIP WITH DNV We established a partnership with Det Norske Veritas in order to align all of our practices with the SA8000 certificate and at the same time assume a leading role in the SME sector by motivating other small and medium-size companies to organize their business operations in line with SA8000. Most importantly, commitment to SA8000 principles will enable further development and strengthening of our employee relations and a responsible approach to the communities in which we operate. The certificate will allow us to introduce clear procedures and a governance system that will guarantee quality working conditions for our employees. By introducing SA8000, we also commit to obeying to ILO Conventions and UN Conventions on protection of children’s rights and make sure any type of discrimination is eliminated.

BY-LAWS The By-laws are a legal document not usually required for small-sized companies. In drafting our By-laws, we consulted an outside expert, a lawyer with long trade union experience in protecting worker rights in Croatia, who is also very familiar with CR developments, but also with all EU labour regulations. The very first thing she said after reading the draft was that the By-laws should not be seen only as a legal document, as they should also clearly indicate our aspirations, our commitment and our sense of direction.

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BECOMING GREAT CONSULTANTS “Every worker has both the right and responsibility to be a professional who produces work that is good, both in technical sense of being performed with skill and knowledge and in the moral

Although Professor Gardner comes from another area of expertise, his way of thinking very much underlines some very recent discussions in PR profession concerning ethics. We are witnessing an increased awareness among public relations professionals and management that ethical performance makes for longrange stability. Achieving ethical performance is also becoming the foundation for achieving an effective relationship with the public, as fellow PRSA Craig Miyamoto claims. We responded to these discussions by creating a framework for responsible business practices. We were driven by two key objectives: we wanted to establish a framework in which we would be able to reach a collective understanding between management and employees that our values do reflect their own personal and professional vision. Equally important was to provide guidelines for handling situations which might or already pose an ethical dilemma. The framework was established in the form of a business ethics program. It reflects our culture and management’s operating style and it is based on four pillars: Code of Conduct, By-laws, Compliance Program, and Risk and Opportunity Management. So far, we have developed the Code of Conduct and By-laws for our company in Croatia. The key elements of the compliance program will be developed next year together with the ethics 54

sense of responding to the needs of society.” Howard Gardner, professor of cognition, author of the book “Good Work: When Excellence and Ethics Meet”.

training module. Risk and opportunity management is an ongoing process that was conducted on a more ad hoc basis, until the World Café discussions at the Academy, which were a turning point in many aspects. That is why we discussed how to cope with the commodification of our profession, which poses additional day-in and day-out pressures. This commodification is apparent across every industry and every country, as the interconnected world facilitates broad searches and broad availability. It is evident that we can create value for our clients and partners if we are able to continuously develop ourselves, both professionally and personally, and establish relationships with our clients based on mutual knowledge and understanding. We also discussed other global trends that dictate changes in our clients’ expectations: a multidisciplinary approach is in demand; clients expect us to follow trends and continually improve; we have to adapt to changes in technology and work organization, companies themselves are exposed to new and challenging pressures - from strengthening competition to growing demand for accountability and good corporate practices, increasing internationalization, development of new media and diversity of information sources, human alienation (the challenge of attracting people’s attention) and workplace flexibility.


SHAPING OUR FUTURE

We asked ourselves how to address these changes in client expectations and what skills and knowledge we need in order to respond to them and support our vision and strategy. The answer was that the education of great consultants never stops, and it requires lifelong learning. In addition, great consultants are open minded and prejudice-free, have high professional standards and objectivity, are good listeners, adaptable persons, quick learners, passionate, good negotiators and diplomats and

have a well-developed ability to express arguments. In order to become great consultants, we encourage specialization and educate ourselves in psychology, economics, management, sociology, political science and international relations, and in linguistics, the media and communicology. We simultaneously continue to hone our abilities in stakeholder relations, management consulting (specifically change management) and CR consulting.

CR Consultancy

We recognized the development of core CR competencies and discernment of the qualities that make a good CR consultant as core issues when it comes to enhancing our capacity to successfully assist our clients in identifying and managing sustainability issues that may have an impact on their business operations and overall business strategy. In 2006, we conducted research on the CR consultancy industry in the U.K. in an attempt to find which competencies were recognized as key to developing professional CR services. Based on the results of this research and our own experience, we expanded our consultancy portfolio with the de-

scription of CR-related services together with a definition of the key elements of our own approach to CR. We additionally ascertained that the following aspects are essential to developing a CR mindset to build distinctive CR competencies: openness to different views and perspectives, readiness to move from familiar ways of thinking, eagerness to accept and handle complexity and “build bridges”, enthusiasm about learning and combining different skills and knowledge and ability to effectively communicate a business case for CR from the standpoint of management rooms.

KEY ELEMENTS OF OUR OWN APPROACH TO CR: Building a business case for CR by becoming “true CR Company”

Connecting CR with other aspects of consultancy work

Ongoing individual personal and professional development

Cultivation of “hybrid” skills and building cross-border teams

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HAUSKA & PARTNER CR REPORT

PROMOTING

the

HIGHEST STANDARDS MEANS BEING ACCOUNTABLE

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CONTENT

6 / A WORD FROM AUDITOR

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HAUSKA & PARTNER CR REPORT

6 / A WORD FROM AUDITOR

ethics etc… was established as an independent consultancy in 1997 to carry the principles and practices of stakeholder engagement and social and environmental accounting learned in the fair trade movement into mainstream business and other large organisations. We believe that people matter - and that the truly successful enterprises of the future will be those that are systematic in developing their strategies around the needs and aspirations not just of their customers and investors but all their stakeholders. They will also recognise the relationship between their own goals and activities and their impact and their responsibility to work for a more sustainable future for society and the planet, locally and globally. We provide independent assurance for corporate and organisational social responsibility and sustainability reports; planning and advice around stakeholder engagement; consultancy in developing CSR and sustainability management systems and accounting; training and guidance in peer review processes for public bodies. In ten years ethics etc… has worked with a wide range of organisations internationally in industry, commerce, the media, government and the NGO community. ethics etc… was the assurance provider for six successive Co-operative Bank Partnership Reports and involved in auditing four Co-operative Financial Services Sustainability Reports. These 58

6

reports have consistently been rated among the best in the world. We have also audited the groundbreaking Guardian Newspaper’s Living Our Values Reports since the first was published in 2003.

Richard Evans, ethics etc…s founder, was contracted by Hauska & Partner Group, by agreement signed 1st November 2006 in Vienna, to: - provide advice on the technical issues relating to compliance wih social accounting standard: content, organisation and documentation of relevant management information, quality of evidence supporting performance data, definition of key performance indicators, analysis of stakeholder consultations and surveys - provide audit of draft report - prepare assurance provider’s statement. The sum agreed for providing these services during late 2006 and January 2007 was £ 2,750.00.


A WORD FROM AUDITOR

ethics etc… is an independent consultancy partnership, based in the UK, providing services to businesses and social enterprises to help them respond effectively and efficiently to the need for a more just and sustainable society. MY RESPONSIBILITIES AND THE ASSURANCE STANDARD My responsibility as an independent auditor is to form a view, on the basis of detailed and systematic investigation, as to whether the statements and claims made in the report are trustworthy and adequately supported by evidence. In doing this I am seeking to apply the three principle tests set out in AccountAbility’s AA1000AS Assurance Standard. These are: - Materiality - is the information relevant to stakeholders’ concerns and interests and will it help them make informed judgments about the company’s performance? - Completeness - does the information provide sufficient evidence that the company understands all its significant social, economic and environmental impacts? - Responsiveness - does the report demonstrate the company’s responses and commitment to improving its performance? In order to comply with these principles I have to form an opinion as to whether the information in the report: performance data and reporting of Hauska & Partner Group’s stakeholders concerns and assessment of the company’s behaviour, is accurate, consistent with Hauska’s values and presented in a balanced manner.

Hauska & Partner have chosen to align the content of their report with The Global Reporting Initiative’s G3 Sustainability Reporting Guidelines. In making my assessment I have also considered whether the report and the GRI G3 compliance statements made are valid. The content of the Social Audit report is entirely the responsibility of Hauska’s Directors. I have not contributed any of the text or information apart from this statement, neither have I designed the systems for information and management control on which the content of the report is based. My responsibility is primarily to Hauska’s stakeholders. I have no relationship with Hauska & Partner Group, its employees or stakeholders that might compromise my ability to act independently in carrying out this audit.

BASIS OF ASSURANCE AND LEVEL This is Hauska’s first CSR Report. It’s scope is limited to describing the development of their CSR process, financial performance data for the Group for the year ending December 31st, 2005, Workplace Assessments and descriptions of HR policies and performance for all members of the Group, except Latvia, and the 2005 Employee Survey for Croatia. All these limitations have been disclosed in the report.

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HAUSKA & PARTNER CR REPORT

I have examined documentation describing all these processes and policies and the results of the employee survey. I have not visited any of the offices concerned but have conducted interviews and sought confirmation of claims through documents supplied by letter post and e-mail. I have also met with the Group’s CR Working Group and the Group President in a specially arranged meeting for a day in Vienna, November 10th 2006. On the basis of this work I am able to provide reasonable assurance about the extent to which the report meets with the criteria of the AccountAbility AA1000AS Assurance Standard.

OPINION On the basis of the work undertaken, and taking into consideration the limited scope of this report, nothing came to my attention which suggests that the report does not properly describe: - the completeness of Hauska’s descriptions of its economic and social impact on its employees - Hauska’s material impacts on its employees - Hauska’s responses to employees’ concerns.

Not one PR/communications consultancy company appears in the top 100 reporters in Tomorrow’s Value - The Global Reporters 2006 Survey of Corporate Sustainability Reporting published by UNEP, Standard & Poors and SustainAbility, and only one, a very large company, appears on CorporateRegister. For readers who did not know Hauska & Partner before reading this report, it is also worth noting that its member companies operate in some of Europe’s more volatile, and vulnerable, economies and societies. This, in our view, makes the principled stand they are taking in their ‘reputationally challenged’ industry in setting standards for the way they work and in how accountable they will be for their actions especially noteworthy. If, as a reader or a stakeholder, you are looking for some honesty and frankness, the very first sentences of this report give a clear taste of what is to come: ….we have been challenged by several professional sins or temptations. The first problematic area is the tarnished reputation of our profession. The profession suffers clear or tacit accusations for being superficial and promotion oriented, filtering facts into only positive reflections, hiding the core valuable information or manipulating stakeholders…

ADDITIONAL COMMENTARY I warmly welcome the ambition of this report from a communications and PR agency that on the global scale is very small indeed, and I hope it provides an incentive and model for others in the sector, large and small.

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The scope of this report is limited but the company has set out a timetable for moving to full disclosure over the next four years. Given the small size of Hauska & Partner, the evolving and expanding nature of the Group, and the limited resource it can afford to devote to reporting its CR strategy, this is acceptable.


A WORD FROM AUDITOR

While this first report is therefore limited in terms of performance data, it is valuable in explaining the lengthy process of developing and implementing CR strategies. They provide a convincing argument for starting the process with the Group’s employees and I have ample documentary and observational evidence of how all employees have been involved from the earliest stages. The Group has also sought advice and perspectives on its approach from other external organisations and from other stakeholders with a particular emphasis on the next stage of its CR strategy development and reporting - its professional conduct in the marketplace. This will be the critical test of whether the Group is committed to responsible behaviour to society as a whole in its core business activities and a further step towards completeness in Hauska’s reporting.

tions and responses of its clients and the public in the environments in which they operate. Materiality must remain the key criterion in Hauska’s decisions about what they report and how they go about gathering data. I have noted that employee surveys will be extended to the other offices in the group and that performance data relevant to the issues identified by employees will be developed and included in future reports. Both in the area of employment and the marketplace, we will expect to see in the next report how Hauska addresses the issue of responsiveness to its findings and to improving its performance. To quote the report: Stakeholder relations require deeds. Finally, I want to thank Hauska’s Group CR Director, its President and other staff for their cooperation during the course of this audit.

Much work will need to be done to develop an appropriate range of performance indicators and the processes necessary to understand the expecta-

Richard Evans, MBA, FRSA ethics etc… 16 January 2007 Newcastle Upon Tyne

Richard Evans worked for twelve years in industry and then twenty years in two development agencies, Intermediate Technology and Traidcraft plc. He was responsible for developing the methodology for the UK’s first independently audited social account (Traidcraft plc, 1993) and subsequently was a founding member of AccountAbility and chair of its Board. He has been involved in developing sustainability

accounting, stakeholder engagement and auditing methodologies and standards with AccountAbility and GRI since 1990 and has audited a range of company and NGO sustainability reports each year since 1995. He has an MBA from Newcastle University, is a Special Professor of Nottingham University Business School and a Fellow of the Royal Society for Arts, Manufactures and Commerce (RSA).

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SUSTAINABILITY IS THE TRUE

modern APPROACH TO COMPANY SUCCESS

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CONTENT

7 / FOLLOWING G3 GUIDELINES

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7

HAUSKA & PARTNER CR REPORT

7 / FOLLOWING G3 GUIDELINES

WE USED FOLLOWING G3 INDICATORS IN PREPARATION OF OUR REPORT: Profile Disclosures 1. Strategy and Analysis 2. Organisational Profile 3. Report Parameters 4. Governance, Commitments and Engagement

Chapters 1, 3, 4

ECONOMIC PERFORMANCE INDICATORS Aspect: Economic Performance EC1 Direct economic value generated and distributed, including revenues, operating costs, employee compensation, donations and other community investments, retained earnings and payment to capital providers and governments Aspect: Market presence EC5 Range of ratios of standard entry level wage compared to local minimum wage at significant locations of operations EC7 Procedures for local hiring and proportion of senior management hired from local community at locations of significant operations

64

Chapter 3 We were able to report on all but one aspect: donations and community investments due to the present monitoring system. For our next report, we have established new monitoring system which will enable us to report on this aspect as well.

Chapter 3

Chapter 3


FOLLOWING G3 GUIDELINES

LABOUR PRACTICES AND DECENT WORK PERFORMANCE INDICATORS Aspect: Employment LA1 Total workforce by employment type, employment contract and region LA2 Total number and rate of employee turnover by age group, gender and region LA3 BeneďŹ ts provided to full-time employees that are not provided to temporary of part-time employees Aspect: Occupational Health and Safety LA6 Percentage of total workforce represented in formal joint managementworker health and safety committees that help monitor and advise on occupational health and safety programs LA7 Rate of injury, occupational diseases, lost days, absenteeism and work-related fatalities by region Aspect: training and education LA12 Percentage of employees receiving regular performance and career development reviews

Chapter 3

Chapter 3

Chapter 3

Chapter 3

Chapter 3

Chapter 4

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HAUSKA & PARTNER CR REPORT

WE LIVE IN A

world OF DIFFERENCES THAT BIND US TOGETHER

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CONTENT

8 / MOVING FORWARD

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8 / MOVING FORWARD

For 2007 we have stated the objectives that we plan to achieve in two main areas: the ďŹ rst one is dedicated to the reporting process itself, and the second to the practices and outcomes we plan to achieve in the workplace and marketplace. Although we deďŹ ne our objectives separately, we see them as complementary - only in combination they will lead to improved performance and sustainability of our business practices. Focus on reporting - More closely and directly integrate management of sustainability issues raised by our stakeholders into overall company management with the CR Working Group as a nucleus for developing a consistent Hauska & Partner Group CR Framework - Improve our internal monitoring system, so that we can better track and collect data across the Hauska & Partner Group required for robust GRI reporting. - Continue assessing and analyzing stakeholder issues and developments that can inuence our operations in the workplace and marketplace. - Prioritize main stakeholders and the issues they raise; involve select stakeholders in the preparation of our second report. - Report on a minimum of 10 G3 Performance Indicators, including at least one each from the socio-economic and environmental spheres in order to qualify for C+ GRI Application Level

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Focus on HR practices - Implement HR practices in all Hauska & Partner Group companies, Latvia included


MOVING FORWARD

Focus on the workplace - Define one key the element of Hauska & Partner Group’s unique workplace standards - define the flexibility model - Use the Workplace Assessment Survey as a tool for ongoing discussions with our employees

Focus on excellence and ethics - Finalize Hauska & Partner Group PM guideline and follow it in our daily practices - Strengthen our CR competencies by updating the CR learning module and organize training for all Hauska & Partner Group employees - Enhance our CR competencies by developing an ethics learning module and organize training for all Hauska & Partner Group employees.

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HAUSKA & PARTNER CR REPORT

we

understand the

70

complexity


CONTENT

of

the

modern

world

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HAUSKA & PARTNER CR REPORT

Eco labeled. Printed on chlorine free paper.

FSC labeled. Product contain wood from well managed forests certiďŹ ed in accordance with the rules of the Forest Stewardship Council.

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Hauska & Partner Corporate Responsibility Report 2005/2006  

First CR report of Hauska & Partner Group

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