Asian companies should take the lead in embracing corporate social responsibility, or CSR. This was the message from global CSR thought leaders at the two-day International Singapore Compact CSR Summit which kicked off today at Resorts World Sentosa, Singapore.
Speaking at the conference as guest-of-honour, Dr Yaacob Ibrahim, Minister for the Environment and Water Resources highlighted the link between CSR and the improvement to the Singaporean community.
“The economy as a whole and the community also stand to benefit. When the majority of businesses in a country engage in disclosure and strive to do better, the economy grows more sustainably and distinguishes itself from other countries,” he said.
“New jobs will be created with the growth of green industry sectors when more businesses identify opportunities for, and invest in, cleaner and smarter resource use. The community too, benefits from a cleaner and healthier environment as businesses seek to minimise their environmental impact”.
On corporate company disclosure, Dr Yaacob noted that a growing number of developed and developing countries have promoted some form of environmental disclosure among businesses. The UK, Japan and Hong Kong have issued guidelines to help businesses disclose their environmental impact. Other countries, like Australia, France and the Netherlands have mandated companies to issue environmental reports.
Ms Olivia Lim, President and Group chief executive of homegrown water technology firm Hyflux told the conference that globally, the trends are “clearly pushing for embedding socially responsible values and practices with the organisation”.
The recent move by local bourse Singapore Exchange to encourage listed companies to do sustainability reporting is “therefore timely and will have a positive impact on Singapore communities”, she added.
“A question business will have to ask of themselves is whether they have increased profits by making others poorer. Have they caused harm to the environment in the process? Businesses through the products and services that they bring to the market, must improve the lives and the wellbeing of people and the environment. Businesses should become less of the problems and more of the solution”.
One of the summit speakers, Mr Juan de la Mota, a UN Global Compact board member and president of the UN Global Compact Spanish Network said that the evidence of embracing CSR for competitive advantage is becoming very clear.
UN Global Compact aims to work with businesses and its stakeholders to influence society.
Mr de la Mota emphasised the importance of hard data and facts. He noted that The Economist found that between 2005 to 2010, the percentage of CEO’s rating CSR as either a very high, or high priority, increased from 35 to 70 per cent.
In discussing the level that companies are embracing CSR, he described a three step path. Firstly, philanthropy, reputation and brand management are the activities for which organisations firstly adopt CSR.
The second is risk management and lastly, value creation is the ultimate step on the CSR ladder. He added that the view of CSR by companies have moved from morality in the earlier days, to “materiality” today, referring to the importance of CSR’s impact on the performance of companies.
Mr de la Mota identified many value-driving areas namely branding, reputation,talent retention, staff motivation, productivity, innovation and more. “It is these drivers that are gaining the attention of business leaders,” he said.
Between 2000 and 2010, the number of companies signed up to the UN Global Compact increased from 47 to 8,000 companies, he noted.
“Companies are saying more and more ‘how do we do it’ rather than ‘why should we do it’”.
Eco-business.com’s coverage of the International Singapore Compact CSR summit is brought to you by City Developments Limited (CDL).
