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According to the Swedish InternationalDevelopment Cooperation Agency (SIDA), themajor problem for the population is the access towater, since 40 percent still lacks access.Additionally, 80 percent of ground water iscontaminated due to lack of purification, whichis a cause of infectious diseases. Moreover, genderequity policies are lacking, and 62 percent ofilliterate people in El Salvador are women(SIDA, 2005).Developing new growth sectors for a morediversified economy has been a challenge in ElSalvador. Like many other former colonies, formany years El Salvador depended heavily on coffeeas the main export. Since the cultivation of coffeerequired the highest lands in the country, many ofthese areas were expropriated from indigenousreserves and given or sold cheaply to coffeegrowers. For many decades, coffee was one of theonly sources of foreign currency in the Salvadoraneconomy. The civil war in the 80's and the fall ofinternational coffee prices in the 90's pressured theSalvadoran government to diversify the economy.On the macroeconomic front, 74 a strong emphasishas been placed on trade integration. 75 El Salvadorwas the first country to ratify Dominican Republic-Central America Free Trade in December 2004,which was bilaterally implemented on January 1,2006. While the treaty will eliminate almost alltrade tariffs with participant countries, the WorldBank suggested that increases in exports andforeign direct investment would depend on theability of the country to implement acomplementary policy agenda, with specialemphasis on improvements in the investmentclimate, trade facilitation and innovation.Recent measures aimed at improving theinvestment climate include a new Competition Lawapproved in December 2004 (expected to becomeeffective in 2006), new legislation approved inAugust 2005 to modernize and streamlineprocedures in the area of consumer protection andthe reduction in the time and cost needed forbusiness registration. There are also efforts tomodernize public registries, as well as the legalframework for facilitating bankruptcy,collateralization of movable assets and e-commerce.In infrastructure, the Government is taking actionsto return to higher levels of investment with newdonor-financed programs in water, electricity, androads (IDB), as well as ports (Japan). Key prioritiesin the Government’s agenda include the port ofAcajutla and cargo operations at Comalapa Airport,the development of a new deep-sea port (Cutuco)and empowerment of the newly created regulatoryagencies for the maritime and aviation sectors(World Bank, 2006). The Government also intendsto improve the main road network and develop anorthern corridor for connecting rural communitiesto potential markets. Finally, the Governmentstrategy assigns a central role to ensuring that thebenefits of trade are accessible to SMEs, bothdirectly through access to export markets andindirectly by developing strategic partnerships withlarge exporters. 76Recent research on CSR in Latin Americancountries (Vives, Corral and Isusi, 2005) providesan overview on the evolution of the importance ofSMEs in El Salvador. In 1992, they were consideredan instrument for the reintegration of repatriatedpeople after the peace agreement. In 1994, SMEdevelopment helped the fight against poverty, withthe support of cooperation agencies, and started to74 El Salvador has one of the lowest tax burdens in the American continent (around 11percent of GDP). Many specialists claim that it isimpossible to advance development programs with such a small public sector (the tax burden in the United States is around 25percent ofthe GDP and in other developed countries of the EU, such as Sweden, it can reach 50percent). The government has focused on improvingthe collection of its current revenues with a focus on indirect taxes. Leftist politicians criticize such a structure since indirect taxes (likethe value added tax) affect everyone alike, whereas direct taxes can be weighed according to levels of income and are therefore fairertaxes. A 10percent value-added tax (VAT), implemented in September 1992, was raised to 13percent in July 1995. The VAT is the biggestsource of revenue, accounting for about 52.3percent of total tax revenues in 2004. (World Development Indicators)75 El Salvador is aware that its viability depends on its integration with other Central American countries. The Central American CommonMarket was initiated in the 1960’s and has experienced ups and downs due to political differences and conflicts among member countries.In October 2000 the Secretariat of the Central American Integration System presented a document with the long-term vision of socialintegration in the region and a Consultative Group for the Transformation and Modernization of Central America was held in Madrid,Spain, in March 2001.76 Some of the instruments for achieving those goals are already in place, including programs for facilitating access to market intelligence(Trade Point), developing and implementing export plans (FAT (Fondo de Asistencia Técnica) and FOEX (Fondo de Fomento a laExportaciones)), and providing training and business development services to SMEs (BONOMYPE and FAT).86 Recommended actions to foster the adoption of Corporate Social Responsibility (CSR) practices in Small and Medium Enterprises (SMEs)
ecome key organizations in the battle againstsocial instability. After the economic crisis of 1998,many unemployed people started business activitieson their own, which were classified as microenterprises, and now represent the most commonform of business in El Salvador.Preliminary estimates indicate that theaugmentation of poverty levels due to theearthquakes of 2001 ranges between 2.6 and 3.6percent points. While the most acute poverty waspreviously concentrated in the northern andeastern areas, poverty has now worsened in thewestern and southern regions where the effects ofthe earthquake were greater. The earthquake forcedthe Government to refocus public expendituretowards reconstruction needs and reviving economicactivity in the most affected areas of the country.The following table shows governance andcorruption rankings in public and privateinstitutions in El Salvador.WEFOrganizationIndexNumber of Countriesin the IndexEl Salvador’sRankingFavoritism in decisions ofgovernment officials 117 38WEF Diversion of public funds 117 42WEF Ethical behavior of firms 117 48WEF Reliability of police services 117 56WEF Public trust of politicians 117 60Strength of auditing andWEFaccounting standards 117 61WEF Judicial independence 117 69Private sectorWEFemployment of women 117 75Transparency International Corruption Perception 159 51UNICEF, ILO,US Department State 2005 77ILO 2005;World Bank 2001 78Quality of hiringand firing practices 117 13Health and safetyprograms adoption 187 13477 www.maplecroft.com78 IdemEl Salvador87
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Recommended actionsto foster the ad
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Recommended actionsto foster the ad
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table of contentsI Acknowledgements
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Chapter 6: Mexico1 Executive Summar
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acronymsCDMCSRECFLAFSCGDPGHGGRIHRWI
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strong internal relationship, in ot
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programs that affect the private se
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Section Four - Recommended Actions
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(Technology Index, Public Instituti
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BibliographyESADE, SDA Bocconi, Nor
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The following chart shows competiti
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CSR area significanceThe following
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structured philanthropic policies,
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the private sector and to develop g
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c. Facilitating, recommended action
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BibliographyAnselmi, P. (2005) ‘L
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APPENDIX 1 - ARGENTINA’S STAKEHOL
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28 Recommended actions to foster th
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2 Economic and SocialFrameworkBrazi
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3 Current State of CSRThe concept o
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micro and small companies based on
Page 44 and 45: Brazil ratified the Kyoto Protocol
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Page 48 and 49: e. Endorsing, recommended actions f
Page 50 and 51: Websites consultedwww.accountabilit
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Page 56 and 57: A stable macroeconomic framework, s
Page 58 and 59: An investigation of Chile’s equit
Page 60 and 61: CSR area significanceThe following
Page 62 and 63: powerful, but are mainly involved i
Page 64 and 65: Fomento al Desarrollo Científico y
Page 66 and 67: a. Improving Promotion and Advocacy
Page 68 and 69: Websites consultedwww.accionrse.clw
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Page 73 and 74: Chapter 4: Colombia1 Executive Summ
Page 75 and 76: In addition, corruption is a widely
Page 77 and 78: CSR area significancesupply chain m
Page 79 and 80: However, market pressures, primaril
Page 81 and 82: - Sponsor a human rights campaign t
Page 83 and 84: . Improving Promotion and Advocacy,
Page 87 and 88: APPENDIX 1 - COLOMBIAN STAKEHOLDER
Page 89 and 90: APPENDIX 1 - COLOMBIAN STAKEHOLDER
Page 91 and 92: Chapter 5: El Salvador1 Executive S
Page 93: El Salvador’s competitiveness. Co
Page 97 and 98: According to Vives, Corral and Isus
Page 99 and 100: subsequent survey, by the World Ban
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Page 103 and 104: 4.4 Civil SocietyIn this study, civ
Page 105 and 106: Tsukamoto, M, Twose, N., (2003) ‘
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Page 109 and 110: Chapter 6: Mexico1 Executive Summar
Page 111 and 112: OrganizationWEFWEFWEFIndexNumber of
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Page 115 and 116: CSR area significancemaxCSR actual
Page 117 and 118: and because of institutional voids
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Page 121 and 122: - Participate in the publication of
Page 123 and 124: López-Acevedo, G., (2006) ‘Mexic
Page 125 and 126: AppendixThe following stakeholder m
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Page 130 and 131: Peruvian civil society has a strong
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Page 134 and 135: Not even the lack of relations and
Page 136 and 137: - Create awareness of accountabilit
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Chapter 8: Venezuela1 Executive Sum
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OrganizationWEFIndexNumber of Count
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3 Current State of CSRCSR actual po
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cooperatives and farmers 114 Unfort
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a. Mandating, recommended actions f
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BibliographyArmas, V. (1999) ‘Esp
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AppendixThe following stakeholder m
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