Asian businesses ranked for corporate responsibility
Updated
Just as foreign businesses consider the domestic socio-political environment of the country they operate in, the issue of Corporate Social Responsibility has also become a key business issue in Asia.
However, little has been done to analyse reports on Corporate Social Responsibility and how companies perform on this front in Asia. Now, for the first time, a CSR Asia Summit will be held in Bangkok next week.
Presenter: Sen Lam
Speaker: Dr Richard Welford is chairman of CSR Asia
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DR RICHARD WELFORD: Corporate social responsibility is essentially a business's efforts to make sure it's protecting local communities, make sure it's engaging with environmental issues including things like climate change. Making sure that its business is well governed, making sure it's engaging with its supply chains. It's basically engaging with those social and environmental issues for which it has some responsibility. And increasingly, good businesses are now recognising that's part of their brand and reputation.
SEN LAM: So does this necessarily involve the participation of people outside the business concerns?
DR RICHARD WELFORD: Well, that would be my philosophy, yes. I would argue that being socially responsible is not only about looking after your own staff and your own shareholders, it's about a responsibility to have a much broader set of stakeholders, particularly local communities where you operate, particularly workers down supply chains - which are often these days, of course, outsourced - so you're not employing those workers yourself, they're somebody else's employees but you still have a responsibility to those people.
SEN LAM: So does corporate social responsibility mainly concern big business or should smaller companies take part as well?
DR RICHARD WELFORD: Well, I think corporate social responsibility is for everyone but the scale of activity is obviously going to differ. I mean, if you're a large multinational corporation, if you're a global player, then clearly you have global responsibilities. If you're a small enterprise located in one small town, I think you have different responsibilities. I think for small companies those responsibilities start with your own staff, start with your own local community. But for the big players, for the big multi-national players and the large listed companies, then I think they do have big global responsibilities and they have a role in tackling some of the big global issues that we face, such as poverty, climate change, health issues.
SEN LAM: And Richard, according to your study, which are some of the countries which have fared best in corporate social responsibility?
DR RICHARD WELFORD: Well, we've looked at a range of Asian countries only because that's our specific focus. And around the stock exchanges in Asia, Hong Kong actually comes out as being the best in terms of the disclosure of corporate social responsibility amongst the listed companies in Hong Kong. Malaysia, Thailand come after that, Singapore are ranked at the bottom, where there's not as much sort of openness and transparency in listed companies there.
SEN LAM: So quite how important is CSR in terms of business operations? Is it more a question of public relations or does it actually make good business practice - that it increases long-term profitability and viability?
DR RICHARD WELFORD: I would argue that corporate social responsibility has to be beyond PR and it has to be really be in the DNA of business. It has to be really, really strategic. I would argue that if you can make your CSR strategic, make it a long-term focus then it can actually add to your competitiveness. It does that mainly through establishing your brands, through giving you a sort of enhanced reputation around things like trust and responsibility. It creates an image of your company that differentiates yourself from other competitors and therefore, it is part of that competitiveness formula, I think.
SEN LAM: And Richard, is the message getting out there in the business community? What are the prevailing attitudes?
DR RICHARD WELFORD: I think that the message is getting out there and particularly at the moment where we're going to go into a situation where we're going to be facing a recession and the possibility is that we're going to see unemployment rising, we're going to see some increases in some pockets of poverty, possibly in the area. So I think corporate social responsibility is now more important than ever as we go into a recession. I think companies are recognising that, but of course at the same time companies are under budget pressure. And one of the things we're likely to see is large companies cutting budgets. I'm not sure they'll necessarily cut budgets in the area of corporate social responsibility though, because I think those companies that are truly, truly responsible will continue with their CSR activities despite a recession.
