good means doing well, too
social responsibility, or CSR for short, has a lot of synonyms.
It is sometimes called "corporate stewardship", "corporate
citizenship", "corporate governance", "business
ethics", "corporate community involvement" or "social
term one prefers, business executives have overwhelmingly made
it a major consideration in their corporate decisions, according
to William Valentino, who cited a January 2005 survey that sampled
the opinions of 130 CEOs across the globe.
general manager, corporate communications, Greater China, Bayer
(China) Limited, was the honorary chairman of the 11th China Daily
CEO Roundtable held on Friday in Beijing. He touched on various
aspects of CSR, from concept to application.
and society are not distinct entities, rather, they are interwoven,
he emphasized. Business obviously needs to make money. "Doing
well" means operating profitably in the financial sense.
But maximizing shareholder value is just the immediate goal. There
are "deeper values" which lie in the realm of "doing
compared a society to a beehive, and individuals like bees working
in unison. The way they behave and collaborate will form and shape
societies. As someone has defined it, CSR means a commitment to
improve community well-being through discretionary business practices
and contributions of corporate resources.
a four-part model, Valentino illustrated that CSR comes into play
in a whole scheme of interaction between business and society.
On a basic level, a business has to have "economic responsibility".
In other words, it has to be profitable. On the second level,
it has its legal responsibility because, like every individual
or organization, it has to abide by the laws of the country where
it is located. Beyond that is ethical responsibility as companies
have to follow behaviour and norms that society expects of them.
On the highest level is discretionary responsibility, which means
that corporations would assume voluntary roles for which society
does not provide clear-cut expectations. "It is something
you don't have to do, but doing it would be for the greater good,"
ethics come down to individuals, Valentino said. "You cannot
say that in cases like Enron, Tyco, WorldCom, the companies were
bad, but they were run by people who made bad decisions."
a positive note, E. Allan Gabor, governor of AmCham China and
chairman and general manager of Pfizer Pharmaceuticals, gave the
example of a Chinese doctor who was called on to fly to Thailand
within 24 hours of last year's catastrophic tsunami in the Indian
Ocean, not knowing when he would be able to come back. "Even
though he represents his organization, it was an individual act,"
rising concerns about ethics and values have been shaped, or "driven",
by several factors: r-ecent corporate scandals are weighing heavily
on the minds of executives as Valentino continued to cite the
Economist Intelligence Unit White Paper. "Companies are increasingly
aware that they are being watched and reported on by media and
by the public."
Schrempf, president and CEO of BMW-Brilliance Automobile Ltd,
stresses the 3-R strategy of its company's CSR initiatives: Resources,
Reputation and Risks.
many years, community development goals were philanthropic that
were seen as separate from business objectives, not fundamental
to them; doing well and doing good were seen as separate pursuits.
But I think that is changing. What many of the organizations represented
here today are learning is that cutting-edge innovation and competitive
advantage can result from weaving social and environmental considerations
into business strategy from the beginning," Valentino quoted
Carly Fiorina, former CEO of Hewlett Packard as saying at a 2003
other words, "doing good" can help "doing well".
"Doing good" can bring benefits to the corporate image
in the minds of the customer, investor, employee and the community.
This perception, coupled with corporate identity, contributes
to the making of corporate reputation.
defined "philanthropy" as a direct contribution to a
charity or cause in either cash or kind, which is the most traditional
of all social initiatives and is usually approached in a responsive
and ad hoc manner. CSR, on the other hand, involves taking a more
strategic approach by choosing a focus and tying philanthropic
activities to the company's goals and objectives.
Kronick, President of Ogilvy Public Relations China, gave the
example of a client, who, two years ago considered giving a million
yuan to a charity. "It had nothing to communicate beyond
its daily operations," he said, but the charity they wanted
to donate to had no strategic link to their business.
opposite example came from Robin Chi, CEO of Metropolitan Life
Insurance Company, China Region. Last year, when he heard over
the radio that Beijing's blood banks were running short of types
A and B blood and the city was organizing a blood drive, he offered
10,000-yuan policies to 10,000 blood donors. "On that day,
46 news organizations showed up to cover the event. A little something
you do with heart and sincerity may go a long long way,"
Yuen, chief executive of The Better Hong Kong Foundation, offered
this advice: "Don't try to use CSR as a project or event
to cover up weaknesses. What you say should be backed up by facts
was echoed by William Valentino, who used the Latin term "facta
non verba" (actions above words) to describe the same principle.
like Bayer are taking proactive action. Bayer is a member of the
Global Business Coalition on HIV/AIDS , a group of 170 companies
operating in 138 countries committed to fighting the AIDS pandemic.
By harnessing core strengths of the business community, it aims
to accomplish the mission of decreasing the number of people dying
from AIDS and supporting those affected by the virus.
also sponsors a public health and HIV/AIDS media studies programme
at Tsinghua University, thus improving the platform for healthcare
reporting in the long run.
there are projects in its charity portfolio that do not seem to
match its business strategy. For example, it has a "micro-finance"
project, which is a partnership with Mercy Corps and the China
Foundation for Poverty Alleviation (CFPA) to fund a micro-finance
project for farmers in Fujian Province.
are not a bank, but it's good for the society," he said.
More relevant is the Special Olympics, to be held in Shanghai
in 2007, which Bayer is actively involved in with sponsorship
a business can justify CSR programmes when there are no incentives
from the government such as tax breaks, it should choose a social
issue to support, select an initiative to address the issue and
implement programme plans. Then there should be evaluation, said
was almost a consensus that companies should not be shy about
publicizing their good deeds. "There's nothing wrong about
making it public," said Ogilvy's Kronick. "The public
should know that Pfizer pledged more money to tsunami victims
than the US government during the early stage of disaster response."
Henry Wang, corporate planning director of Shell (China), said,
Shell has quantified CSR in its key performance indicators. "For
our joint ventures, we want to balance our social, economic and
Tse, managing director of Booz Allen Hamilton Greater China, said
that Chinese companies have been socially responsible, but "for
different reasons" and usually in a narrow sense. They tend
to focus on employees rather than the bigger community. As Chinese
companies expand overseas, they'll have to realize that there
is a set of universal values that corporations should observe.
Jason Li, general manager for sales and marketing, Insurance Australia
Group, asked how CSR can be aligned with traditional Chinese values,
Valentino responded that Chinese values such as family and community
are "very much in place" when a corporate citizen expands
its values to include the community and the environment.
Qi, executive secretary-general of the China Business Council
for Sustainable Development (CBCSD), reveals that Chinese companies
such as Sinopec, FAW and BaoSteel have actually started their
own CSR programmes with a view to promoting Chinese companies'
social responsibilities, including those of SMEs.
Liying, assistant resident representative of the United Nations
Development Programme (UNDP), echoes that her agency has cooperated
with 60 Chinese companies in different cities on CSR programmes;
and that over 60,000 Chinese companies are already members of
the China's Glory.