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Private Sector Has Bigger Role to Play in the Americas

Private Sector Has Bigger Role to Play in the Americas

by Ian T. Brown

WASHINGTON, D.C. -- With the fifth Summit of the Americas beginning Friday, Gallup finds a median of one in three respondents across 20 Latin American nations agree that large companies in their country engage in various acts of corporate social responsibility (CSR). These acts include investing in their employees' development, promoting advancement, making important donations, and having a positive impact on their consumers' quality of life. Nearly half disagree that large companies engage in these acts.


The summit theme -- "Securing Our Citizens' Future by Promoting Human Prosperity, Energy Security and Environmental Sustainability" -- emphasizes sustainable development. However, participants must discuss possible solutions against the backdrop of an ongoing global economic slowdown. The financial crisis has negatively affected public trust in the private sector. The U.N. Global Compact, the world's largest corporate citizenship initiative, promotes the idea that private corporations can restore public confidence in markets through responsible business practices.

Corporate social responsibility (CSR) is a relatively new practice in many Latin American countries. Gallup did not ask these questions in Canada or the United States, where CSR is well established and openly promoted by corporations as a way of bolstering their competitive advantage. For emerging markets across Latin America, private investment in people -- the very title of a session during the summit's Private Sector Forum -- is a significant ingredient for future competitiveness and economic prosperity.

Responsible Business Practices Toward Latin American Employees

Gallup asked respondents across Latin America about large corporations, here defined as foreign and national companies of any kind that almost everybody knows about and that usually have hundreds or even thousands of employees. Regarding corporate practices toward employees, Gallup asked respondents if they believe corporations invest in employee development and give equal opportunities for advancement. Of the 20 countries surveyed, respondents in the Dominican Republic, Costa Rica, Venezuela, and Brazil had among the highest level of agreement on both questions. El Salvador, Peru, Ecuador, and Trinidad and Tobago -- this year's summit host -- had among the lowest levels of agreement on both. In almost every country, less than half of respondents agreed that large corporations were engaging in these practices.


As an example of the dynamics at the individual country level, an Inter-American Development Bank report released in February 2008 found that Venezuelan President Hugo Chavez enacted social policies and programs affecting the private sector and that business associations and civil society also supported CSR initiatives. In contrast, in El Salvador and Peru, the governments did not consider employee-friendly practices very important for improving economic development. Since Gallup polled, El Salvador elected a new president who had pledged more partnership with the private sector.

Responsible Business Practices Toward the Latin American Community

Gallup also asked respondents if large corporations in their country make contributions and donations to their community, and if they make a positive impact on consumers' quality of life. Again, Costa Rica, the Dominican Republic, and Venezuela had among the highest level of agreement and, again, El Salvador, Ecuador, and Trinidad and Tobago had among the lowest. Mexicans' attitudes toward large corporations fall near the median for each question. According to The Economist, few countries are as vulnerable to the United States' financial slowdown as Mexico.


One fear for CSR is that the global recession means less corporate profits available for community philanthropy. In many Latin American countries, particularly those in which economic hardship is threatening to turn into social unrest, public and private contributions to community development are crucial for economic growth. The private sector in Latin America can strengthen its connection with its employees, customers, and community to create a win-win relationship between producer and consumer. This weekend's summit fora could determine if further private commitments are possible for securing a better future for Latin America's citizens.

Survey Methods

Results are based on face-to-face interviews with at least 500 adults, aged 15 and older, in Argentina, Bolivia, Brazil, Chile, Colombia, Costa Rica, Dominican Republic, Ecuador, El Salvador, Guatemala, Haiti, Honduras, Mexico, Nicaragua, Panama, Paraguay, Peru, Trinidad and Tobago, Uruguay, and Venezuela conducted in 2008. For results based on the total sample of national adults, one can say with 95% confidence that the maximum margin of sampling error ranges from ±3.4 to ±4.8 percentage points. In addition to sampling error, question wording and practical difficulties in conducting surveys can introduce error or bias into the findings of public opinion polls.

Johanna Godoy and Jesus Rios contributed to this article.

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