A conference hosted two weeks ago in Bangkok by CSR Asia drew an interesting and interested crowd. Some of the usual corporate suspects – Coca Cola, Hewlett Packard, Danone, UBS, H&M, a smattering of non-corporate suspects – NGOs, government and multi-laterals, and of course, those of us that work at the seams of both – the diligent consultants.. The intention of the conference: to ‘push the boundaries of social and environmental responsibility’ in Asia.
Against a backdrop of global financial meltdown, the slashing of headcounts, budgets and targets, one might be forgiven for thinking that rather than pushing the boundaries, there would be talk about re-drawing the boundaries, contracting even. However, while a passing nod was made to the economic crisis and the implications thereof, there appeared – at least in public – to be a sense of ‘business as usual.’ I found this perplexing. Coca Cola championing the cause of ‘water neutrality,’ HP sharing its progress on responsible supply chain management, UBS speaking about its support for great community projects…
I had just arrived from China, where the gates of thousands of factories (whose livelihoods depended largely on exports to the US and Europe) were clanging shut and workers once more on the move; suppliers to my client, a large manufacturer in central China, were suddenly changing credit terms and demanding cash up front. Demand for basic raw materials was dropping dramatically. And China is by no means the only Asian country with a significant exposure to export markets. Thailand, Indonesia, Vietnam, Cambodia and India are all vulnerable.
And so my question to the Plenary was this: notable corporate efforts on social and environmental responsibilities notwithstanding, was there not a need to acknowledge and respond to a more fundamental responsibility: that of economics? After all, it has been business and governments’ abject failure to meet their economic responsibilities that has got us into this mess in the first place. And we’re not just talking about banks and investment houses. How will companies be handling the laying off of workers? What contingency plans will be made when the inevitable budget cuts come to ensure that the good work is not undone or people left worse off? Only a few weeks ago, a new report cited that over half of the 700 largest corporations in the UK were not fulfilling their tax duties. Globally, unpaid corporate taxes translate into USD250 billion a year – a sum that could easily fund the Millenium Development Goals (MDGs) several times over.
As is always the case, coffee breaks and evening aperitifs yielded a few more sobering and honest views. For some, simply that yes, cuts were likely to be brutal, and CR teams were under threat. For others, a brave face; after all, ‘this is a core part of how we do business’ with an acknowledgement that some adjustments might be necessary.
Interestingly, it was a leading Thai politician from the opposition party who, whilst acknowledging the role of governments to regulate more effectively, called for wholesale reform of ‘share-holderism’, for markets to cease rewarding greed, and for companies to put ‘social purpose’ back into the heart of its businesses.
Global economic contraction will bring hardship to many around the world, developed and developing, but those in Asia with heavy exposure to export markets will suffer particularly. For this reason, it is even more critical that businesses with operations in that region sustain their social and environmental commitments. After all, they have created markets, they have created expectations, and they have public commitments to uphold.
The Chinese word for ‘threat’ is made up of two characters: wei (crisis) and ji (opportunity). The current climate is undoubtedly a threat to all of us who wish to see companies playing a more positive role in society. While nobody wants to see companies stop measuring their carbon footprint or auditing their factories, the crisis affords a genuine opportunity to re-evaluate companies’ contract with society, to re-focus on some fundamental economic responsibilities (jobs, taxes, transparency), and ultimately, to re-build trust.
Liza is Associate Director at Corporate Citizenship. A fluent Mandarin speaker, Liza worked in China for 10 years, her first job as procurement manager for a state-owned brewery. She later became Director of APCO China, where she advised companies on a broad range of investment, government relations and corporate responsibility issues.
COMMENTS