On Corporate Social Responsibility

Channel News Asia reports:

Campaigners representing the rural poor, the environment and organised labour blasted the communique as a sideshow, stage-managed for corporations who are major contributors to the World Water Council, which organises the Forum…

"We demand that the allocation of water be decided in an open, transparent and democratic forum rather than in a trade show for the world’s large corporations."

Full article here.

Interestingly, Ethical Corporation Institute says that big businesses like Rio Tinto, SAB Miller, Coca-Cola, Intel and Molson Coors are "leading the way in water management" (link here) and saliently, Jeff Conant said last year:

As we learn from the WWF website, “One of the benefits of joining the WWC is the Council’s ability to influence decisions related to world water management that affect organizations, business, and communities.” Perhaps their secret meetings will also be attended by executives of the Worldwide Fund for Nature, whose recent partnership with Coca-Cola aims to help the global soft-drink giant become “the most efficient company in the world in terms of water use,” with “every drop of water it uses… returned to the earth or compensated for through conservation and recycling programs.” And, with this blending of fact and fiction, it would hardly be surprising to find Greene’s signature on the CEO Water Mandate, which has companies with such devastating environmental track records as Dow Chemical, Shell Oil, Unilever, and Nestlé pledging to “help address the water challenge faced by the world today.”

Full article here. The italicized names are linked to rather interesting pages in the original article. Greene here refers to James Bonds’ villain in Quantum of Solace.

What does one make of it all? Alas, these great tides of information and opinion indeed confound the mind.

Since I’m in Indonesia right now, I’ve been reading the papers here. The Jakarta Post reports an interesting case today:

Subarkah said it was unfair to make a smoking haram on the basis that it could be bad for some people. In fact, he said, forbidding smoking would only cause pain and suffering to tobacco farmers and their families.

"There are 1,367 tobacco factories in East Java, employing thousands of workers," Subarkah said.

According to the association, tobacco farmers in East Java supply 53 percent of the country’s total tobacco consumption with a total investment value worth Rp 682 billion.

Full story here.

I’m guessing that this might be a more general theme although I’ve not researched it much. But with more and more people quitting plastic bags and other packaging, a similar effect might be hitting the people who produce them. Is this necessary? Of course, I’m speculating a little right now.

Here’s an unrelated article that’s very pertinent too, and which might be a tad sensitive especially for bodies on the receiving end. Is corporate philanthropy CSR? Is it an important question at all? Coming from a student population with so many societies getting funds from corporates, I can’t quite tell if corporate money is a good thing. Our own CSR Student Movement does research sponsors a little and have rejected sponsorship offers for various reasons before, but we were always keenly aware of how much good we could potentially do with that money. Painful sometimes.

I keep wanting to write about the possibility of the world turning towards a newer form of economics but time disallows me. So, here’s a bit from an IHT article that might tempt you to find out more:

"And signs of a protectionist backlash are multiplying as worries about climate change, the rise of state-run investment funds and the bursting of the recent credit bubble give novel ammunition to those in the West who question free markets and clamor for more shelter from globalization…

When students of economics open their history books in 2030, they might read about 2008 as the year when the groundwork was laid for a re-regulation of certain markets, a more redistributive tax system and new forms of international policy coordination, economists say."

I recently attended a Singapore Compact lecture by Dr Jem Bendell on the luxury industry and he highlighted to us how Beijing has taken down billboards of the luxury brands and how India has raised taxes on luxury items more than 100%. Both actions were direct results of concerns over unrest fomenting due to very perceivable inequalities in society. Looks like there are to be some serious changes coming. I wonder how the corporate world will deal with it.

In other news (full article here), Singapore has tasked an "Inter-Ministerial Committee" to look into sustainable development. Our PM says,

"How do we get economic development and growth, and at the same time, grow in an environmentally friendly way? That’s the idea of sustainable development, where you build into your whole development strategy this awareness of the environment, energy, conservation and efficiency," said PM Lee.

This committee will "seek to build new competencies and facilitate mindshare across the public, private and people sectors to develop Singapore as an "Eco-Hub". The aim is to make Singapore an innovative thought centre and hub for urban and environmental sustainability."

The continued mindless use of the word "hub" and "mindshare" aside, it’s a good piece of news. Let’s hope we go beyond simply environmental sustainability soon, though. Sustainability has so much else to offer.

CEOs in America urge legislators to enact legislation to counter climate change.

"Ours is a unique and diverse group, which is united in the belief that we can, and must, take prompt action to establish a coordinated, economy-wide, market- driven approach to climate protection.

The members of the United States Climate Action Partnership (USCAP) are committed to action and believe that properly constructed policy can be economically viable, environmentally responsible, and politically achievable. Swift legislative action on our proposal would encourage innovation and provide needed U.S. leadership on this global challenge.

Our goal is to help our nation create public policy that would act aggressively and sustainably to slow, stop and reverse the growth of greenhouse gas (GHG) emissions."

The US Climate Action Partnership consists of companies including BP America, General Electric, DuPont, Lehman Brothers, and Caterpillar.

+ Source

+ Press release 

What’s the most inspiring story of entrepreneurship that you’ve heard in 2006? For Guy Kawasaki, the answer does not involve two guys in a garage who sell their company to Google for $1.6 billion. No way… his answer is a woman who runs a soccer-ball factory in Kabul, Afghanistan.

Fortune magazine features an interview with Anwar Ibrahim on the role of businesses in contributing to corruption in developing countries.

"Business has to be part of the development process, so we made intense efforts to promote the private sector. I strongly support market reforms, deregulation, privatization, all the mantras of today’s global economy.

But for this to work, we need business to be accountable, and we observed serious flaws in this regard. In my experience, business can tend toward cronyism, corruption and other poor practices in the absence of a free press, a vibrant civil society and effective law enforcement."

The full interview is available online here. 

A strong stance against corruption is one of the UN Global Compact’s Ten Principles. In many developing countries, where rule of law and institutional oversight is relatively weak, bribery may be seen as necessary to get the wheels of bureaucracy turning in favour of one’s business and investment needs. I doubt that many see such payments as corruption, but as business costs involved in succeeding in the local business environment. There may be a possible defence if the host nation has different laws and standards than the company’s home nation — but an offence like corruption likely appears in every country’s statute books. No excuse for dodging accountability this time.

I just saw Anwar on the BBC channel yesterday, speaking on the World Communication for Develoment panel. Seems like he’s getting pretty busy eh.

Thanks to the Nobel Committee’s recognition of Muhammad Yunus and the Grameen Bank, microfinancing is now getting the attention it deserves. The New Yorker profiles the various approaches to microfinance. As with many projects that start out well-intentioned, some microcredit institutions are reconsidering altruism in favour of profit-driven, commercially-sustainable models.

The debate is about much more than purity of motives. The Yunus faction worries about “mission drift,” saying that, as the drive for profitability increases, only the so-called “less poor” (as opposed to the very poor) will qualify for loans. “On the one side, there are the people saying, essentially, We want to be Citigroup for poor people,” said Jonathan Lewis, the C.E.O. of MicroCredit Enterprises, which provides loan guarantees from wealthy donors to institutions that serve mainly the poorest women. “But, on the other side, we’re saying, We didn’t start this to become a bank. We started this to end poverty. So we’re going to experiment with all the different ways, profitable or not, that we can work with our constituencies—who are our customers, not our shareholders. If your core mission is to provide a channel out of desperate poverty, it creates a different set of questions than if your mission is to create a global market in microfinance futures.”

Read the full article here.