On Corporate Social Responsibility

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.

I just had to blog this, because it seems so cute.

Work-life balance seems to be the hot topic these days. Renny and I attended the Work-Life Conference recently, and then on the 24th of July, CNA penned this little article. An excerpt:

SINGAPORE: Civil servants can look forward to a better work-life balance. An advocate and ambassador will be appointed in every public sector agency to help find the middle ground between the two worlds…

Teo Chee Hean, Defence Minister and Minister In Charge of Civil Service, said: "The Work-life Advocate will by its very name be a champion for work-life and pro-family measures.

"He will take steps to ensure that work-life policies are in place, and more importantly that these policies work for the employees as well as the organisation.

"To signal the government’s commitment, the Deputy Secretary of the Ministry will be the Work-Life Advocate."

While I want to rejoice and shout hurrah at this, a good, large pinch of salt screws my lips together and I make a bit of a grimace. Personal and secondary experience suggests caution. While exact details and past examples do not jump readily to mind (possibly because I’ve got a memory like Swiss cheese), the few friends I have asked share the same opinion. An ex-teacher, who declines to be named, informs me that in her school, there used to be this person appointed to look after teachers’ welfare. The person poked around too much, and did not contribute to anything remotely constructive. Another informant comments that the deputies who have now been made work-life advocates will "sure dulan", which in English really means that they will be extremely annoyed.

There is one fundamental issue here and it isn’t whether or not these advocates will be effective. Rather, it is the pervasive cynicism that is worth taking a gander at. The CSR Student Movement had a booth during the NUS Matriculation Fair held this week, and I spoke to a number of freshmen who questioned whether or not something like CSR would work. There were doubts and there was skepticism and beneath it all was a feeling that idealism could not work. Sometimes, it was worse. Some apparently think it is something to avoid. I start with the word "corporate" and they gasp, I say "social" and their eyes widen, and by the time I reach "responsibility", they’ve actually shoved my flyer back into my hands and run away. Literally, run away. They’re always female, interestingly. I don’t quite know why they feared CSR so much, but I conjecture that they feel about it the same way society used to feel about those hippie treehuggers and their crazy ideas. Now society knows better, what with the media propagating climate change and the hip and cool nature of environmentalism.

Anyway, this cynicism is an obstacle to not just our cause but to every other one too. It prevents people from trying to change things because they believe it is pointless to do so. And because they do not want to help out, worthy causes remain tiny. So, hopefully, the work-life advocate effectively (genuinely effectively, and not superficially, or what locals call "wayang") advocates work-life balance and achieves measurable changes for the better. It would give many people hope and then they would perhaps become more active in making the world a kinder place to live in.

That said, I think the work-life advocate is a wonderful idea and will at least give voice to people who believe that work supports life and not the other way around. Small achievement, but one nonetheless. Hurrah!

From Inter Press News:

"I think that we have to fight the Global Compact, not only criticise it, because it is a public relations operation of the big multinational companies," Ziegler told IPS.

"The 500 biggest multinational companies controlled last year 52 percent of the gross world product," the Swiss academic said. 

 And:

Greenpeace’s Mittler took the view that it is not the U.N.’s role to organise business round tables. "It is the job of the United Nations to set binding international standards and ensure that these can be, and are, enforced," he said.

"The world needs action and binding global codes for corporate behaviour," he added. "The Global Compact is not delivering."

Mittler pointed out that an analysis by McKinsey & Co., a management consultancy firm, "showed that only in 10 percent of cases was there any evidence of companies doing something that they would otherwise not have done as a result of being a member of the Global Compact."

Oliver Classen, media officer for The Berne Declaration, one of Switzerland’s oldest non-governmental organisations, called on U.N. Secretary-General Ban Ki-moon to "fundamentally rethink the ‘accord’ with big business."

Mittler, in turn, asked Ban "to disassociate himself from ‘greenwashing’ by the coal and nuclear industries through the Global Compact."

"The UN’s Global Compact is been a mockery because several companies violating human rights have been free to join and remain in the Global Compact, (thus) benefitting from an association with the UN," said Aftab Alam Khan, ActionAid’s head of trade. 

What do you, think, dear reader?

On the one hand, I think this has some truth in it. On the other hand, I think not everyone takes well to harsh criticism, no matter how true they are. Thus, while the aggressive stance taken by Greenpeace and other suchlike groups are extremely helpful (and really, really admirable), more moderate institutions are needed to bridge the uncomfortable gap between the critic and his findings and the companies in question. The Global Compact provides a possible platform for such a thing to happen, but it only works if it is used in that manner. I guess for now, the Global Compact is still evolving. It will find its teeth sooner or later, but be they canines, incisors or molars is really what we would like to know.

Really, hasn’t the UN as a whole been criticized for just about the exact same reasons? It has no teeth and it panders to the stronger nations, so it has been said. The Global Compact faces the same problem, doesn’t it? Not everyone can agree on how to run things, and the companies are sovereign in themselves. The UN cannot bind them to agreements so simply just as it cannot easily bind sovereign states.

Still, as is stated, 10% of companies in the McKinsey & Co. study did perform socially responsible acts as a result of joining the Global Compact. While it is very low, it’s better than 0%. Add to that what groups like Mittler’s Greenpeace do and you’ll have more than 10%. The more coaxing and pressure on companies the better. A culture will gradually develop that will make companies regulate themselves. Takes time.

Ok, here’s something else other than the problems of the Global Compact. There is an interesting article here about how technology exported from China to the USA goes back to China as e-waste which is then exported back to the USA as toxic jewellery which has caused at least one death. I think I’ll post a bit more about this if I have the time. Responsible globalization is a very important topic with this sort of thing happening more and more.

Cuiyu had a little bit of a skeptical post on greenwashing some time ago. It’s a very important topic, considering how environmentalism is on the rise at least in terms of consumer awareness. From the New York Times via CorpWatch:

British mobile-phone operator Vodafone has topped the list at the 2006 Global Accountability Rating study. The survey, conducted by AccountAbility and CSRnetwork, measures six criteria, ranging from stakeholder engagement to performance management, at the top 50 companies on Fortune’s Global 500 list. Fourteen other large companies were included so that there were at least ten in each of five industry sectors. The results were published in Fortune last Monday.

The Top Five: Vodafone, BP, Royal Dutch/Shell, Électricité de France and Suez  (French water company)

+ Full ranking

+ More on the global Accountability Rating

+ Full story in Fortune