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The CSR Digest D

The CSR R Digest offers quality q content on corporatte social respon nsibility (CSR) and

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Doing g Good, Doing Well W

(SRI). The CSR Digest ex xplores the corporatte conscience worldwide, w with a

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special e emphasis on Ma alaysia and the

CSR Global G S Summit t 2009

Asia Pacific Rim. For ou ur editorial content, clickhere. The Digest is also

One mig ght say thatt, in Malays sia, most pe eople think being socially y responsible for busine esses mean ns apportion ning part of their profits tow wards some worthy cau use. Those who w have this view w would ha ave been con nfused if th hey attended d the CSR Global Summit S 200 09, held in Singapore S o 13th and on d 16th January y 2009. Organiz zed by Pinnacle Group International, the even nt was for senior managemen m nt, public re elations, corrporate s to learn communications and human resources r p professional more ab bout strateg gies to enha ance their CSR C efforts.

currently y a free distribu ution electronic c digest, s so feel free to send your conte ent or press releases to us at editor [at] csrdiges st dot com .

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What wa as evident from f the ge et-go was th hat CSR, as most m practitio oners see itt, encompas sses far more than justt generous donatio ons. A consc cientious co orporation behaves b responsibly from th he beginning g of its proc cesses to th he point it when w it withdra aws its profiits for distriibution, and d beyond! • • • • • • •

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where ind dicated. Copyrightt of Deviant Art visuals remain with the e authors/artists.

Dr Geh G Min

 

Dr Geh Min, the immediate past President of Singapore’s Nature Society, opened the conference with colourful analogies from her experience with the human anatomy. She pointed out that behaving in a responsible manner is fundamental to the health of a business, and not cosmetic application. She also noted that the only kind of cells that grows at all costs is the tumour cell, which eventually destroys itself. Likewise, she believed that corporations should, not only stop looking at profit at all costs, but go beyond the triple bottom line (profit, people and planet) in the future.

CSR reporting The first day of the conference had a few talks where speakers attempted to define corporate social responsibility, perhaps in order to define the parameters of what a business is obligated to do (and by implication what it does not need to do), or perhaps because there are quite a number of definitions for CSR. Founder and Managing Director of OWW Consulting Malaysia, Dr Geoffrey Williams, succinctly stated that

A responsible business finds out who its stakeholders are, what they want, and deliver it to  them.  Dr Williams pointed out that this is the new management paradigm that businesses need to consider. Founder and Managing Director of Counterpoint Professional Services Malaysia, Steve McCoy, agreed with Dr Williams, adding that structural changes need to take place within the organization, and that CSR is not merely a matter of good intentions.

Dr Geoffrey Williams

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In fact, all the speakers agreed that CSR goes far beyond good intentions, and underpins all of a business’ processes. And, as pointed out by Professor Dr Mustaffa Mohamed Zain (see earlier interview), businesses should publicize their CSR efforts. Aside from Professor Dr Mustaffa’s reason for reporting (to encourage others), Dr Williams stated that reporting is essential, otherwise no one would know a company’s standing in relation to the CSR efforts it has made. For example, Dr Williams displayed a chart showing

 

the position of each country’s CSR standing, with Singapore generally ranked on the lower end. However, Dr Williams believes this is not because Singapore’s businesses are not behaving responsibly, but because they fail to report their behaviour successfully. The reason why reporting needs to be done, aside from encouraging others and being ranked (i.e. the competitive component, which businesses cannot run away from in this day and age), is for investment purposes. New ethical funds are approved all the time, and the fund managers need to know how ethical, responsible and green a business is, before it will invest in it. Furthermore, a country’s ranking will give fund managers and investors indicators as to where to place their moneys. Aside from this, Dr Williams also said that the best way to attract and to keep employees (and investors) is to tell them about how the business is behaving responsibly. Furthermore, most times the failure to tell stakeholders might lead to the assumption that there is something to hide. UN PRI UK Executive Director, James Gifford, gave pointers on the principles of responsible investment (PRI), where he likened businesses to fiduciaries for its stakeholders and investors. At the end of the day, Dr Williams noted, CSR increases revenue, decreases costs and therefore decreases risk.

Pressure points Edelman Group’s South East Asia Managing Director, Robert Grove, stated that businesses are under pressure from three sources: • Non-governmental agencies (NGOs) •

Labor / Employees

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Consumers

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In fact, Grove pointed out that consumer activism is at an all time high. Perhaps, the CSR Digest notes, this can be seen in the recent conviction of perpetrators of the melamine poisoning scandal last year. In addition to this, fifty percent of employees would not want to work for an employer they did not trust. According to Grove, the workforce is doing their own due diligence on potential employers, made easier by websites like Glassdoor.com.

 

Mr Robert Grove Grove also stated that IBM allows employees to spend ten percent of their working time on causes close to their heart. This was explored by Steven Davidson of IBM Global Business Services Hong Kong on the second day of the event. Davidson explained IBM’s perspective when it comes to CSR and the workforce: • • •

CSR leadership attracts and retains top talent Employee involvement in CSR strategy leads to more and better solutions Employees involved in CSR objectives are best able to capture emerging customer expectations

While many corporations take a top-down approach when it comes to employee engagement, Davidson believes that usually CSR initiatives come from the bottom up. In fact, the program that allows employees to utilize ten percent of their time in their preferred causes benefits IBM. For example, when an employee decides to work in a HIV related cause in South Africa, IBM eventually gets to learn more about that emerging market. If the company were to decide to penetrate the market, they have personnel who have groundlevel knowledge of the country and its workings.

Laws, soft and hard

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IBM’s Davidson stated that his company believed that it is better to be open rather than to be pried open. According to Davidson, stakeholders are now the brand managers for businesses, stating that all it takes is one photograph of one wrongdoing sent to a pressure group that could cause great damage to a business’ brand. With an estimated one billion camera phones worldwide, all it takes is just one to cause negative impact to your company’s reputation, and with the world growing smaller, and the

 

advent of Web 2.0, not just the products and services of a business, but its operations, suppliers, and partners are wide open to scrutiny. On this note, Managing Partner and Head of the Corporate and Securities Law of KhattarWong, Tan Chong Huat, believes that soft laws, or guidelines, rather than hard laws, or legislation or case law, works best for CSR. Aside from the pressure points faced by businesses, Tan believes that fossilizing CSR into hard laws might cause unnecessary demands on a business.

Mr Tan Chong Huat Michael Chiam, Malaysian Mirror Committee of Social Responsibility Member, Nominated Expert for the Industry Stakeholder Group and Malaysian Employers Federation Council Member, opined that, on some occasions, these international guidelines or soft laws can cause hardship on developing nations, citing the troubles faced by Malaysia’s fishing export industry recently. Millions of ringgit worth of seafood is languishing in freezer units in Malaysia because they ’suddenly’ do not meet EU’s hygiene and environmental standards. As such, Chiam believes that these soft laws amount to barriers to trade, especially for those in need of trade.

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Going Green Singapore’s Vice President and Head of Corporate Communications of Lanxess, Kaye Lim, discussed how Lanxess deals with its green issues. Believing that CSR is the “next Industrial

 

Revolution” and global megatrend, Lim pointed out some alarming environmental issues, including: • Atmospheric concentrations of carbon dioxide are thirty-five percent higher than before the Industrial Revolution •

Currently, there are 19 megacities (over 10 mill people) in the world, with 8 expected to come into existence within 15 years.

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World demand for oil and gas will outstrip supply within 7-10 years.

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About 1.1 bill people do not have access to safe drinking water.

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World food demand to rise by 50% over next 20 years.

Lim pointed out that business opportunities arise from these trends, such as clean energy, environmental resource management, energy and material efficiency and sustainable investment and business services. Furthermore, businesses in existence can develop a competitive advantage through sustainability. Lanxess focuses on three aspects of CSR globally. Aside from its interesting social/cultural and education/ empowerment efforts, Lanxess efforts in its processes are noteworthy. Lanxess will build a second laughing gas reduction unit (LARA) at its Krefeld-Uerdingen site, set to be in operating this year. Because of this, Lanxess will cut its annual emissions of climate gas in Germany by 1.5 mill metric tons by 2012. This project will eliminate as much as eighty percent of the company’s total direct greenhouse gas emissions in Germany.

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Ms Kaye Lim Furthermore, the chemicals group is in the process of setting up an innovative and highly efficient cogeneration plant at its Brazilian site. The new plant, which will have a capacity of 4.5 MW, will operate with bagasse, a component of sugar cane left over from sugar production. Through the use of raw material, energy generation at the plant becomes completely carbon dioxide neutral.

 

YTL Corporation Malaysia’s Director of Environmental Investment, Ralph Justin Dixon, explained that YTL’s CSR focus includes protection of the environment, promotion of arts and culture, and supporting education and community development. While its promotion of arts and culture and development of education and community endeavours are laudable, YTL’s environmental efforts are of particular note, especially as its business is mainly in development. Firstly, YTL’s takes a special initiative in responsible tourism. Its Pangkor Laut Resort on Pangkor Island Malaysia is an entirely green development, from its design to the types of building materials used, to its waste disposal. YTL also has on-site ecologists at the resort, dedicated to researching the biodiversity and ecology of the rainforest, wildlife and marine life on the island, as well as running educational tours for visitors.

Mr Ralph Justin Dixon

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The company also takes measures to lessen its activities’ impact on the environment. According to Dixon, YTL works with the Malaysian Government to implement a policy of using clean fuels. Its power stations are designed to minimise impact of emissions, particularly nitrogen dioxide and its submarine pipes are extended ten percent further than required by engineering by-laws so that the ambient temperature of marine environment is maintained. Furthermore, YTL has obtained ISO14001 Certification (Environmental Management Systems) for both its power stations in 2007.

Achievements

 

The event also allowed businesses to showcase their achievements. Proctor and Gamble (P&G), together with World Vision International, explained how they worked together to get a special community product by P&G (which purifies water) to Myanmar after Cyclone Nargis hit the country. With World Vision having its presence in Myanmar, the product was packed shipped to Myanmar, and disseminated more easily than it would have been, had there been no partnership in the effort.

(l-r) Farlim's Dato Mohamed Iqbal, Mr Michael Chiam & Dr Amin Khan

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Senior General Manager of Maswings, Dr Amin Khan, talked about the airlines endeavours in the environment and the people. Mentioning that the company’s CSR tagline was “Always for the People and the Environment”, or “APE”, the company has several CSR projects, including Wings of Borneo, a project offering cheap rural flights in Northern Borneo, Wings for Children, with which Maswings offers free flights to sick children living in the Northern Borneo jungles who are in need of hospital care and Project PINTAR, which aims to help raise the awareness of the importance of education as a way to improve the academic standards of underprivileged children from deprived socio-economic conditions.

Final day panelists

 

On the first night of o the confe erence, Pinn nacle also organized th he Gala Awa ards Dinner & Global CSR C Awards s Ceremony y at the sam me venue, re ecognizing outstanding o g CSR achievements in th he region. The T categoriies and gold d winners are as follow ws: • Best Env vironmental Excellence Award - Ku ulim (Malays sia) Berhad •

Best Com mmunity Programmed Award - Glo obe Telecom m, Philippin nes

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Best Workplace Practices - FedEx

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CSR Leadership Aw ward - Merck k Ltd, Thaila and

sharing and Many more m speake ers participa ated in the knowledge k d/or showca asing of the eir busines sses’ CSR un ndertakings s, a list of which w is available here.◊ ◊

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