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Corporate Social Responsibility

By David Campion

Corporate Social Responsibility (CSR) has varying definitions but is generally considered as companies taking the initiative to reflect social and environmental concerns in their activities and in their relationships with stakeholder groups. It is not philanthropy; but a deliberate effort to create a sustainable environment in which to conduct business. It focuses on triple bottom line value (environment, society and business) rather than just the financial bottom line.

The Asian CSR context is slightly different from Europe and the United States, where the concept originated. In Asia, embedded cultural tenets align to social responsibility, both in the Buddhist beliefs of assistance and equality and in the traditional hierarchical society whereby overall welfare is the concern of higher societal members to maintain productivity and harmony for all. As a result adoption of CSR philosophy has been quick, but the implementation and benchmarks required for social sustainability may take some time within the current institutional framework of many Asian countries. Encouragingly though, many Asian Non Governmental Organisations [NGOs] and governments are enthusiastically buying into the CSR concept, a sign for its future evolution in the region.

Multinational institutional frameworks are also reinforcing this. Next year the draft version of the ISO26000 guideline should be released which will advise companies how to integrate CSR within business practice. In addition various awards for sustainability, corporate governance and environmental stewardship are now common, enticing companies to adjust. So CSR in Asia is evolving like the rest of the world; moving from a “box ticking” charity exercise into a corporate strategic and tactical decision making process.

Local level actions are also occurring, for example in Phuket industry is beginning to work towards a co-operative CSR approach setting an agenda for more sustainable tourism. This type of network concept is working across many other regions, both in Asia and the rest of the world. In Singapore, Ms. Claire Chiang, a co-founder of Banyan Tree Holdings and leading proponent of CSR within the company was the inaugural head of Singapore Compact, the local chapter of the U.N. Global Compact. This United Nations strategic initiative was created to align private sector operations and strategies with overall sustainable development efforts by agreeing to 10 key principals regarding human rights, labour, environment and anti-corruption.

A 2009 CSR Asia report on the top 10 CSR issues facing companies over the next decade underscores the change in approach wrought by the recession and other global events impacting Asia. When comparing the 2007 list to present concerns some marked changes are apparent in the approach of Asian companies. Some examples include: environmental concerns dropping from first to fourth; corporate governance jumping from third to second; human resources and labour jumped from fourth -to third stakeholder partnerships moved from eleventh to fifth, and corruption dropped from fifth to tenth.

Top of the list is climate change, seen by CSR stakeholders as dominating the future CSR agenda. In 2007 this topic did not arise, presumably being incorporated into the “environment” category at the time but now it stands on its own.

The December Climate Change conference in Copenhagen may further raise climate change interest in the private sector. Increasing emission cuts could directly target certain industries, causing operational restrictions but also opening huge potential for alternate energies and emissions trading. As a result companies may increasingly direct their CSR portfolios to renewable energies, thereby serving the sustainability agenda while utilizing the increasing incentives available across the region.

Overall though, increased emphasis on climate change, corporate governance and human resources means governments and politicians will likely exert increasing influence over the Asian CSR field in the future, as seen in Europe. In Asia, Indonesia developed the world’s first CSR laws however a more effective approach may be in the People’s Republic of China where the government has extensively researched and issued CSR guidelines directly to companies.

In a new development reflecting the times, the internet and on-line media and communities [new media] are also expected to play a growing role in communicating CSR by all institutions. And the increasing speed of communication across a global playing field will exert influence on the way companies report and go about their business.

Overall CSR in Asia is not yet as widely practiced as in Europe and America but it is on the increase. However, one issue given less attention by companies, but with high demand from their stakeholders is disclosure and transparency. This will undoubtedly change over time as Asian companies increasingly adopt CSR policies into their business model, but transparency remains paramount. Banyan Tree Holdings has received the ‘Most Transparent Company - Hotels & Restaurants’ award fourtimes by the Securities Investors Association of Singapore (SIAS), the most recent being this year.

It has now moved even further forwards by establishing Banyan Tree Global Foundation headquartered in Singapore. The foundation status completely separates sustainability oriented funding from mainstream business practice, ensuring total transparency and accountability of funds raised. There is no doubt that other Asian businesses will adopt this type of model to further reassure stakeholders as we move forward with CSR in this region.

This Op-Ed piece originally appeared in the Bangkok Post. Published on November 7, 2009.
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David Campion is Group Director, CSR Operations at Banyan Tree Hotels and Resorts.. He is responsible for the Banyan Tree Hotel and Resorts and Laguna Resorts and Hotels CSR operations around the world.




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