Transcript Corporate Social Responsibility: The ASEAN Perspective

Corporate Social Responsibility
in ASEAN
LCF CSR CONFERENCE 2008
Manila, Philippines
16-18 July 2008
Presented by:
Dr. Filemon A. Uriarte, Jr.
Executive Director
ASEAN Foundation
Corporate Social Responsibility in ASEAN
ASEAN Member
Countries
Brunei Darussalam
Cambodia
Indonesia
Laos
Malaysia
Myanmar
Philippines
Singapore
Thailand
Viet Nam
ASEAN FOUNDATION
Corporate Social Responsibility in ASEAN
Area and Population
Land
(1,000 km2)
Population (million)
2006
Brunei Darussalam
5.8
0.383
Cambodia
181
14.2
Indonesia
1,891
222
Lao PDR
237
5.75
Malaysia
330
26.6
Myanmar
677
57.2
Philippines
300
87.1
Singapore
0.7
4.48
Thailand
513
62.8
Vietnam
329
84.2
Country
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Corporate Social Responsibility in ASEAN
Economic Performance
Country
Brunei Darussalam
GDP per capita
(in USD) 2006
GDP total
(in billion USD) 2006
30,159
11.55
Cambodia
512
7.26
Indonesia
1,640
364
Lao PDR
613
3.52
Malaysia
5,890
156.9
Myanmar
208
11.95
Philippines
1,356
118.1
Singapore
29,500
132.3
Thailand
3,289
207
Vietnam
724
61
ASEAN FOUNDATION
Corporate Social Responsibility in ASEAN
The ASEAN Foundation
 Established by the ASEAN Leaders on 15 Dec
1997 during the ASEAN 30th Commemorative
Summit in Malaysia.
 The MOU was signed by the ASEAN Foreign
Ministers
 The MOU was revised in July 2000 and
ratified by all ten
member countries
in July 2007
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Corporate Social Responsibility in ASEAN
Our Mission
 To promote greater awareness of ASEAN,
and greater interaction among the
peoples of ASEAN, as well as their wider
participation in ASEAN activities through
human resources development
 To contribute to the evolution of a
development cooperation strategy that
promotes mutual assistance, equitable
economic development and the alleviation
of poverty.
ASEAN FOUNDATION
Corporate Social Responsibility in ASEAN
Corporate Social Responsibility in the APEC Region:
Current Status and Implications
Asia Pacific Economic Cooperation, December 2005
Corporate Social Responsibility in Indonesia
United Nations Research Institute for Social Development,
December 2001
Corporate Social Responsibility: The Indonesian Context
Edward Manik, Frontier, June 2008
Corporate Social Responsibility in Asia
J. L. Gonzales III, Golden Gate University, August 2005
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Corporate Social Responsibility in ASEAN
Similarities across Asia-Pacific countries
 Origins and conceptualization of CSR are rooted in
historical and cultural traditions of each country and
deeply influenced by ethical concepts and religious
practice.
 CSR is gradually moving from its historical focus on
business philanthropy to a broader set of activities that
integrate the practice of CSR into the core strategy of
the organization.
ASEAN FOUNDATION
Corporate Social Responsibility in ASEAN
Similarities across Asia-Pacific countries
 Efforts at measurement and reporting are growing
rapidly in the belief that formal monitoring and evaluation
of outcomes will enhance credibility of CSR and make it
easier to substantiate.
 CSR has evolved in response to profound external
forces such as meeting regulatory obligations and
responding to public opinions that demand higher
standards of accountability.
 Larger companies are increasingly turning to
partnerships with other stakeholders in implementing
CSR activities.
ASEAN FOUNDATION
Corporate Social Responsibility in ASEAN
Patterns of CSR activities in developed
economies:
 Great
emphasis on the importance of
environmental stewardship and strengthening
of environmental management practices.
 Strong
and active civil society involvement.
 An
important driver is the management of
supply chain often in response to wellarticulated consumer concerns.
ASEAN FOUNDATION
Corporate Social Responsibility in ASEAN
Patterns of CSR activities in developed
economies:
 Strong
traditions of community outreach
including corporate community investment
that extends beyond charity.
 Companies
are increasingly engaged in
strategic partnerships with stakeholders within
communities in which they operate.
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Corporate Social Responsibility in ASEAN
Major Challenges:
 Appropriate
responses to globalization.
 Identification
and addressing gaps in CSR
practices.
 Development
of common standards of good
practice throughout the supply chain.
 Assurance
of exemplary corporate behavior
worldwide.
ASEAN FOUNDATION
Corporate Social Responsibility in ASEAN
Patterns of CSR practices in developing
economies:
 Emphasis
on the role of multinational
enterprises in importing good CSR practices,
which are emulated by local corporate
community.
 Key
drivers are the requirements of the global
marketplace and their supply chains.
 Tendency
for global protocols to influence
CSR practices.
ASEAN FOUNDATION
Corporate Social Responsibility in ASEAN
Major challenges
 Raising further awareness of CSR.
 Building capacities within existing institutions
to drive adoption of CSR.
 Making the case to the local business
community to adopt CSR.
 Transferring competencies to individual
companies.
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Corporate Social Responsibility in ASEAN
Indonesia
 State of CSR is still in early stages but
development indicates encouraging signs.
 Concept of social responsibility imbedded
in Indonesian culture (gotong royong).
 Promotion of CSR has been marked with
initiatives in both government and private
sectors.
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Corporate Social Responsibility in ASEAN
Indonesia
 Most companies in “compliance stage”
where they adopt policy-based compliance
as a cost of doing business.
 Some have reached the “managerial stage”
where they embed societal issues in their
core management process.
 A few in “strategic stage” where companies
integrate societal issues in their core
business strategies.
ASEAN FOUNDATION
Corporate Social Responsibility in ASEAN
Philippines
 Birth of CSR concept and its initial practice
can be traced back to 1950s.
 Market forces have been the major drivers of
CSR behavior.
 Persistent social problems are the main
challenges to sustaining commitment to and
making resources available for CSR.
ASEAN FOUNDATION
Corporate Social Responsibility in ASEAN
Philippines
 Most CSR efforts are philanthropic in nature
with education and health being the main
recipients.
 Growing internal expressions of CSR linked to
operations of the organization with companies
promoting employee involvement.
 Leaders who play significant role in CSR are
the principal agents for the CSR promotion
strategy.
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Corporate Social Responsibility in ASEAN
Singapore
 Development of CSR is influenced by country’s
unique characteristics as a city state that has
achieved economic success where government
remains a key architect of the economy and has
considerable influence over corporate behavior.
 Government-centric approach influences CSR
strategies with much emphasis on compliance with
legislative requirements as a means of achieving
and regulating socially responsible behavior.
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Corporate Social Responsibility in ASEAN
Thailand
 Practice of CSR is at its early stages of
development substantially influenced by religious
beliefs and traditional norms of ethical practice.
 Full integration of CSR into business
management at the strategic level is not yet
widely evident reflecting insufficient commitment
by top management and the general perception
that CSR is primarily business philanthropy.
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Corporate Social Responsibility in ASEAN
Thailand
 Engagement with NGOs deals with sound
environmental practices and social development
while engagement with government emphasizes
compliance with environmental, health, labor and
safety standards.
 The CSR challenges include narrow perception of
CSR by many leaders, threat of economic
downturn, and negative perceptions that of CSR
standards as a form of trade barrier.
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Corporate Social Responsibility in ASEAN
Vietnam
 CSR activities are regulated and supervised by
the government and corporate social policies
observe state regulations as outlined in the
companies’ annual plans.
 CSR thrust includes meeting requirements of
import partners, avoiding conflicts with local
labor and to some extent philanthropy.
ASEAN FOUNDATION
Corporate Social Responsibility in ASEAN
Vietnam
 Enterprises and government are the main
players for promoting CSR where enterprises
determine the success of CSR and
government promulgates policies and
supervises implementation.
 The main challenge is to raise the level of
awareness of CSR since consumers have
limited appreciation of CSR and do not relate
it with social concerns.
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Corporate Social Responsibility in ASEAN
1. Do CSR and voluntary initiatives have
the capacity to change how TNCs
really behave in their day-to-day
operations?
2. At this stage of its development, and
in the context of the latest crisis, is
CSR relevant to Indonesia?
Report on Corporate Social Responsibility in Indonesia,
UN Research Institute for Social Development (Dec 2001)
ASEAN FOUNDATION
Corporate Social Responsibility in ASEAN
Do CSR and voluntary initiatives have the
capacity to change how TNCs really behave
in their day-to-day operations?
While it is fair to say that CSR makes a positive
contribution to the human rights of those
working in TNCs, it is also fair to say that it only
makes a difference to those few corporations
targeted by consumers or who are already
thinking ethically and responsibly. Other
industries are not under such pressure.
Report on Corporate Social Responsibility in Indonesia,
UN Research Institute for Social Development (Dec 2001)
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Corporate Social Responsibility in ASEAN
At this stage of its development, and in the
context of the latest crisis, is CSR relevant
to Indonesia?
Indonesia may be able to benefit from CSR, but
it cannot rely on CSR to solve issues of
exploitation, environmental devastation and
poor labor standards, particularly when
Western finance corporations are impervious to
environmental or labor rights lobbying and
community outrage.
Report on Corporate Social Responsibility in Indonesia,
UN Research Institute for Social Development (Dec 2001)
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Corporate Social Responsibility in ASEAN
In Indonesia, there is a continuing controversy over
the inclusion of CSR under Law No. 40 of 2007 on
Limited Liability Companies, Article 74, paragraph 1
that states:
“Companies doing business in and/or in
relation to natural resources must put into
practice social and environmental
responsibility”
This provision is opposed by many corporations.
Edward Manik, “Corporate Social Responsibility:
The Indonesian Context”, Frontier, June 2008
ASEAN FOUNDATION
Corporate Social Responsibility in ASEAN
Corporate Social Responsibility in Asia
Dr. J.L. Gonzales III, Professor in Golden Gate University (Aug 2005)
Three major conclusions:
 A profitable or competitive business climate and
wealth accumulation are necessary
preconditions to initiate CSR.
 CSR culture in Asian business derives from
spiritual and philosophical underpinnings.
 CSR requires a legal framework that promotes
openness, partnerships and democratization.
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Corporate Social Responsibility in ASEAN
If one’s actions are motivated only by
profit, one will have many enemies.
- Confucius
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Corporate Social Responsibility in ASEAN
Look back at your business and life, at
their end, and honestly say that the
years of doing business have had some
meaning. We should be able to look back
and see that we have conducted
ourselves and our business in a way that
had some lasting meaning and which left
some good mark on the world.
-Buddha
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Corporate Social Responsibility in ASEAN
A good name is to be chosen rather than
great riches, and favor is better than
silver or gold. The rich and the poor
have this in common, the Lord is the
maker of them all.
- Bible Book of Proverbs
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