Give to get

There are many ways in which Chinese firms need not emulate their Western counterparts to find success. But according to some experts, there's one way in which they should look for guidance: corporate social responsibility.

Chinese enterprises should increase their understanding and awareness of social responsibility for future success, says Gao Shangquan, chairman of the China Enterprise Reform & Development Society. He made his remarks at the 2006 2nd China Enterprise Social Responsibility Summit held in Beijing.

The performance of social responsibility is vital for the success of an enterprises' globalization, the chairman says. It's also important for the nation's sustainable development and a harmonious relationship among human beings, he says.

"Neither enterprises nor the government should simply pursue economic benefits while neglecting their social responsibility," Gao says.

Among the moves Chinese firms should make, he says, is turning the practice of social responsibility into competitive ability, building a legal system and legislative conditions for the practice of social responsibility, fostering relations between economic benefits and social interests, and analyzing the costs and benefits of enterprises' social responsibility conduct.

Global responsibility

The growing gap between the rich and the poor has been a negative side effect of China's rise. Social fairness and equality have become important considerations in making policy.

"If enterprises refuse to shoulder social responsibility, they will not be accepted by society," Gao says.

Economic globalization also requires enterprises to place emphasis on social responsibility, he says.

A global compact was put forward at the 1999 World Economic Summit in Davos and came into effect on July 2000.

The compact included 10 basic principles involving human rights, labor standards, environmental protection and anti-corruption.

Twenty-six Chinese enterprises have become members of the global compact.

"Fostering social responsibility is a ticket to enter the international market," Gao says.

Some countries and regions, such as the United States, Japan and the European Union (EU), have special standards and requirements for the enterprises' social responsibility.

These standards have become passports to enter their markets. Some Chinese enterprises have already been turned away by foreign countries after reviewing their lack of practices in social responsibility, Gao says.

In order to give, enterprises must give up a part of their earnings, Gao admits. However, this will benefit them in the long term, he says, as their investment will bring them more opportunities to be involved in international affairs and enhance their international popularity-foundations for enterprises to establish business relations with international counterparts.

At present, only a small number of Chinese enterprises are active in carrying out social responsibility. Cheng Siwei, vice-chairman of the Standing Committee of the National People's Congress, called on the government, associations, the media, consumers and model entrepreneurs to join hands in educating enterprises and making the exercise of social responsibility a common practice.

Volunteer basis

Engaging in social responsibility is mainly a voluntary practice. However, related laws and regulations are also needed to encourage enterprises to engage in charity, and chastise those who refuse to shoulder social responsibility.

The government's function is to maintain legislative and social conditions for enterprises to carry out social responsibility and urge enterprises to fulfil the task based on their own ability.

Gao says he is optimistic about the future because he has seen more and more Chinese enterprises realizing the trend of giving and beginning the practice.

The Chinese Enterprise Social Responsibility Alliance was established in 2005, and over 100 Chinese enterprises joined the organization, which has succeeded in the research and practice of establishing a social responsibility management system.

The Enterprise Social Responsibility Society, a branch of the China Enterprise Reform & Development Society, has promoted exchanges and co-operation with foreign countries and organizations including the World Bank, the American Council, and EU to carry out enterprise social responsibility.

(China Daily 01/27/2007 page8)