Paul French takes a tour round the business responsibility trends of southeast Asia
Obviously, as this is a “China” column, its contributions are invariably about the People’s Republic. However, business in neighbouring southeast Asia is alive and well and facing many of the same corporate responsibility problems as China.
In most places local issues take precedence. Malaysia’s Astro, the country’s largest Pay TV service, has been behind a major deep-sea cleaning process in Sabah on the Borneo coast involving 139 divers cleaning the seabed and relocating precious coral. Astro has of course televised much of the underwater action, raising awareness of seabed conservation.
Corporate responsibility has been promoted in Malaysia in recent years through the actions of the Kuala Lumpur stock exchange, pushing companies to include corporate responsibility statements in their filings. Consequently, many Malaysian main board-listed companies have a prominent corporate responsibility policy. However, James Pereira, a local reputation and marketing consultant, believes many companies have a way to go yet, saying that a lot use corporate responsibility activities as a tax write-off and have a “been there, done that” attitude.
Singapore has an advanced corporate responsibility sector, as might be expected of a modern service-oriented economy. Certainly the rush of new global companies, especially in the finance sector, that have expanded their operations there in recent years has boosted this responsibility trend.
Many have been seeking to be good community citizens. For instance, the local DBS Bank has undertaken a programme to open up the Marina Bay harbour to the public. The company has sponsored the DBS Marina Regatta and a DBS Social Enterprise event, working with the government and community organisations, including the Urban Redevelopment Authority, the Singapore Dragon Boat Association and the Singapore Sailing Federation.
Across in Indonesia corporate responsibility is at a slightly earlier stage than in Malaysia or Singapore, and still more focused on philanthropy. One interesting initiative is from the country’s largest pawnshop operator, Pegadaian, a state-run company.
Aware of the fact that pawnshops don’t always have the best reputation among many consumers, being seen by some as part of the problem of poverty rather than a solution, Pegadaian (which is highly profitable) recently donated an ambulance to a charity for the poor and announced the provision of free health services in central Jakarta. The company also sponsors three orphanages.
Other firms operating in Indonesia also suffer from poor PR and have been ramping up their efforts to counter the negative publicity their operations attract. The oil and gas industry is one such sector, with land acquisitions a particularly contentious issue.
Pertamina EP, part of the state energy firm, is one company that has run into local community objections over land acquisitions. After some demonstrations and problems between guards and local communities in Palembang, Pertamina has significantly increased its stakeholder engagement activities, liaising with local groups. Critics say it is just trying to buy off local objectors, but others see this as the start of a possibly more progressive outreach programme by the energy giant.
Cambodia, Laos and Vietnam are attracting attention as alternative sourcing points for China. However, issues as diverse as workers’ rights and preservation of heritage are all appearing. For instance, the Angkor Gold Corporation, an American publicly traded gold explorer operating in Cambodia, has launched a corporate responsibility programme after locals voiced concerns about its activities.
Angkor Gold is sponsoring elected village development committees as well as planting fruit trees, digging wells and running family planning and health educations sessions.
In communist Vietnam, corporate responsibility faces many of the challenges seen in China. But that doesn’t mean that nothing is happening. The Hanoi-based Vietnam Chamber of Commerce and Industry has started monitoring the local corporate responsibility situation and instituted an annual awards scheme. It seems foreign companies will lead the way – for instance, HSBC recently partnered with the Dariu Foundation and Maison Chance to work with disadvantaged Vietnamese children through projects worth $500,000.
This is a pattern becoming more common across southeast Asia – initiatives are popping up in response to local issues, both in developed economies and, perhaps more importantly, in those emerging markets where corporate responsibility has previously been a very secondary consideration.
Paul French has been based in China for more than 20 years and is a partner in the research publisher Access Asia-Mintel.business strategy China column Paul French Responsible Business trends