CSR Introduction

CSR stands for Corporate Social Responsibility. It deals with treating all the major stakeholders
of a company in a very ethical and socially acceptable responsible manner. What does treat
ethically means? Treating ethically means the company is behaving and dealing with these
stakeholders in such way that is well accepted in any civilized society like ours today. Corporate
Social Responsibility has three components namely Economic Progress, Environmental
Protection and Social Responsibility as seen in the below graph. All these three aspects must
work in sync for the company to achieve its social responsibility goals.

Social responsibility for a company also includes its economic responsibility towards the
investors. There are two types of stakeholders that a company must satisfy through its Corporate
Social Responsibility. These are external and internal stakeholders.

The Internal Stakeholders are:

 Employees
 Managers
 Board of Directors
The external stakeholders are:

 Customers
 Suppliers
 Investors
 Government
 Society

The main goal of Corporate Social Responsibility is to always aim at creating a better standard of
living for the stakeholders along with keeping the company’s profits intact for both the external
and internal stakeholders’ benefit. Therefore, Corporate Social Responsibility can be said to
include an ethical behavior of the company for their stakeholders. Many companies call
Corporate Social Responsibility by various other names like corporate citizenship or an ethical
corporation or good corporate governance. The change in name should not distort the meaning of
Corporate Social Responsibility. Corporate Social Responsibility should not be construed as
some form of a philanthropic activity required to be done by a company.

The use of the word social included in the definition states that the companies have moral
responsibility towards to people and society in which they operate. Profits cannot be the only
sole objective of the company today. The company must understand that its actions will have an
impact on the lives of the people and the environment in which it is operating and therefore the
CSR is a very comprehensive all-encompassing term.

Global Reporting Initiative (GRI) is an independent standards organization whose objective is to

make businesses and the respective state governments to gauge and understand the impact of
their actions on the global warming, human rights and corruption. GRI encourages companies to
publish a sustainability report which should mention three aspects of the business and its impact
on the economic, environmental and social issues which are caused due to these business
activities in the everyday life of the people. A sustainability report aims at defining the
organizational values as well its model for corporate governance and this sustainability report is
acts as a medium to communicate the sustainable performance and its impact.
Company Profile

The company that we have chosen for the CSR analysis is Al Shafar Steel Engineering LLC also
known as ASSENT. It is part of the Al Shafar Group of Companies (ASGC). The parent
company was established in 1989 in Dubai, United Arab Emirates and the factory is in Dubai
Industrial City.

ASSENT is the largest Steel Fabrication and Erection Company in Dubai and it been part of a
diverse industrial and commercial projects in the UAE which a special focus on very high quality
and has the capacity to cater to high demand for steel products globally. ASSENT’s
manufacturing facility is in Dubai Industrial Park has the production capacity of 120,000 ton per
year.

The major services provided by the company are:

 Engineering Design & Detailing.

 Fabrication.
 Painting & Fireproofing.
 Erection.

The main products of the company are:

 Hot Rolled Steel Structures

 Pre-Engineered Buildings
 Cladding & Decking

The company’s Vision statement is as below:

“Assent's Vision is to exceed the client expectations - every time and achieving continued
recognition internationally as market leader in structural steel, pre-engineered building, cold
form, cladding and accessories - known for our suppleness, competency and know-how in global
market, in a work place with no injury to our employees”.

The company’s Mission statement is as below:

“Assent's mission is to be one of the most efficient and creative manufacturer in the whole world,
with continual improvement for our methodology and effectiveness, by enlarging our market
shares by adding new products to our core of business and influencing other new regions every
time.”

The company has two subsidiaries namely

 ASCO Building Contracting

 ASSENT Steel Trading

A CSR Study of the Company

Al Shafar General Contracting LLC (ASGC) which is the parent company of ASSENT received
CSR Label award from the Dubai Chamber of Commerce in 2015 for being socially responsible
company. The CSR Label award is given to a few selected UAE companies After a very rigorous
selection process which includes audit and visit to the company. There are our areas which are
focused and then a winner is shortlisted. These four areas are community, environment,
marketplace and workforce. This was a very prestigious and honorable occasion for ASSENT as
well because it contributes to the guidelines of the group companies in the implementation of
Corporate Social Responsibility. In the below picture we can see the prestigious CSR Label
award being presented by the Hamad Buamim, who was then the CEO and President of the
Dubai Chamber and the award being collected by ASGC's CEO Bishoy Azmy.

Existing CSR Activities

The company’s social responsibility manual suggests that it will focus on four pillars for its
Corporate Social Responsibility. These four Pillars are

 Workplace
 Community
 Environment
 Youth & Thought Leadership

1) Workplace: - The company fulfils this pillar of workplace by engaging various employee
engagement activity. Broadly workplace pillar has three aspects namely:
  Employee Development and Career Progression – The company organizes Cricket Cup
very year for the benefit of its employees.
 Healthcare & Wellness – The company had a corporate participation in the annual Dubai
Fitness Challenge presented by the Dubai Sports Council
 Employee Social Activities – During the Holy month of Ramadan, the company
organizes Iftar events for its stakeholders.

2) Community: - The community pillar has two aspects namely:

 Responsible Builder of Projects with High Importance – The company was instrumental
in building the Etihad Museum in Dubai which is a building of national importance.
 Philanthropy Relationships – During the month of Ramadan the company distributes
Ramadan Care Packages and has donated a lot of books and cash towards the Mohammed
Bin Rashid Library.

3) Youth & Thought Leadership: - The Youth and Thought leadership pillar has the below three
aspects:

 Forums and Conferences – The company invites industry veterans fore various forums
and conferences which enrich the knowledge of its employees.
 Internship Programs – The company gives opportunities for University Students to come
and work with them as a part of the curriculum internship program.
 Excellence Awards – These excellence awards are targeted towards the kids of the
company’s employees who are academically bright, and the company gives them
scholarship for higher education in prestigious universities.

4) Environment: - The environment pillar has the below three aspects:

 Clean Up Campaign – The company runs various environmental campaigns like Clean
the beach in coordination with the Dubai Municipality.
 Sustainable Building & Technology - The company is working on building the LEED
Platinum Certified buildings which are more energy efficient.
 Re-Use & Recycle – The company has a policy to reduce the waste and recycle office
stationery including printed papers.
  Environmental Campaigns – The company encourages its employees to participate in the
Earth Hour and other such environment campaigns.

CSR Implementation

The entire CSR activity is implemented at the corporate level from the top based on the CSR
manual which the company issued in 2018. The HR is responsible for all the employee related
communications and CSR activities. The line managers are constantly given feedback based on
feedback from employees to the HR. All the social responsibility campaigns are run centrally.
The employee engagement activities happen every month depending on the nature of the activity.
For example, the company has a month birthday celebration where the employees receive a small
gift on their birthdays. The company also celebrates various festivals like Valentines Day,
Christmas and Eid. These employee related activities help them increase the motivation level of
the employees. The social process and environmental activities are managed by the senior
management by putting investment in clean technology and supporting government initiative.
The company also contributes to CSR Dubai which is the official CSR arm of the Dubai
government. The company is also planning to come out with a sustainability and CSR report as
per GRI standards in the due course of time.

CSR benefits

Companies that become socially responsible and contribute back to the society while making
profits are successful in the long run. We see in the recent times large corporates contributing to
the relief work over COVID-19 and such contributions make them a good brand in the eyes of its
stakeholders. All companies cannot perform the same level of social development nor can they
be involved in all the aspects of the society’s development needs. What is expected from these
companies is that they get involved in some aspects of the social development.

The government of a country also notices the contribution made by corporates and therefore
gives incentives to such firms. In the case of ASSENT, the company’s being a socially
responsible citizen has given them a plenty of benefits both for them as their parent group
ASGC. Due to the active corporate social responsibilities done by both ASGC and its group
companies including ASSENT, it has been able to get projects from prestigious government and
private clients like Meraas Holding, Dubai Properties, RTA, Dubai Police, Taj Group, Abu
Dhabi Health Authority, ADNOC, Expo 2020 and Damac Properties among others. The
company has successfully delivered landmark projects like City Walk, Coca Cola Arena, Golden
Mile, Business Central Towers, Vision Tower, Bay Square, Dubai Police General Headquarters
among others

In the case of the parent company of ASSENT, one more benefit they got from their corporate
Social responsibility was the CSR label award from Dubai Chamber in the 2015 for their
outstanding contribution towards welfare of the society, customers and the employees. These are
by product benefits of a good company into Corporate Social Responsibility.

The other benefits of doing Corporate Social Responsibility are:

 Better brand recognition.

 Good business reputation.
 Increase in sales and customer loyalty.
 Costs savings
 Healthy financial performance.
 Ability to attract talent
 Easy availability of capital.

Challenges & Barriers

There are five main barriers to the implementation of Corporate Social Responsibility in a
company. These reasons are:

1) Lack of different Resources: -

Most of the companies face issues due to resource constraints in finances and human capital.
Implementing the Corporate Social Responsibility requires the companies to demarcate a
specific amount of funds for this purpose. The problem is specially faced for small companies
which have very limited resources. They have limited financial budget and lower human power
to implement most of the social activities suggested from time to time.

2) Strategic Vision is missing: -

Corporate Social Responsibility decisions are taken at the corporate level and all the business
units just implement that at their level. It is therefore imperative that there is a strategic vision
and guidelines behind the implementation of CSR in the company and a rule book or manual is
made. We can see in the case of the company chosen for this project ASSENT, they have rule
book which is a CSR guideline issues in the year 2018 and all the Corporate Social
Responsibility are implemented according to that manual. For companies, which do not have a
set manual or a strategic vision, implementing CSR is a big hassle and a barrier on the way. The
lack of strategic vision is due to the missing top management commitment. The reason many top
managements don’t commit to CSR is because of short-term goal of profit maximization. When
a company is not making profits, it is difficult for them to implement CSR and spend money on
Social responsibility activities because it would lead to making the shareholders unhappy at the
cost of pleasing others like customers and employees.

3) Lack of systems to measure CSR

Companies need to gauge the success and benefits of their implementing the Corporate Social
Responsibility. This means they always want a cost-benefit analysis from the CSR. It is not
possible always to derive this cost-benefit. Due to lack of measurement tools, the Corporate
Social Responsibility is often misunderstood as corporate governance or business ethics but, it is
a much deeper concept.

4) Less willingness for CSR expenditure

During situations like economic recession or in a pandemic situation like the onset of COVID-
19, the companies are less willing to spend on CSR and are more concerned in conserving the
cash. This is even though situation like these demand companies to be more socially responsible
and government expects the companies to contribute more in fighting these economic and health
crises. Many a times, the companies feel that they are not recognized or their contribution on
CSR front by the government and the public at large and therefore unwilling to spend more.
5) Changing Regulatory Standards

The companies which are into high regulation zones and those which employ people in
hazardous nature of tasks, or they are into environmental polluting business, these companies
face issues with a strict compliance to Corporate Social Responsibility. Examples companies into
Mining, Oil & Gas, Shipping etc. always are under the direct scrutiny of their government and
are expected to follow CSR. Companies face difficulties when the regulation change and they are
taken off guard.

Recommendations and Current CSR activities

The current variables under which ASSENT’s Corporate Social Responsibility is based on its
corporate strategy and all the CSR activities emanate from the Social Responsibility manual. UN
Sustainable Development Goals have been formulated with a vision of 2030 in mind and all
corporates have the potential to contribute towards these goals. ASSENT’s Corporate Social
Responsibility is based on the below five variables.

 Sustainable development
 Waste Management
 Environmental Responsibilities
 Community Responsibilities
 Stakeholder responsibilities

Potential improvement to CSR Variables

We suggest the below strategies as an improvement area for ASSENT’s overall Corporate Social
Responsibility framework. These are based on the most likely benefits the company will derive
from the given recommendations.

 Sustainable development
o Improved health facilities for employees
 o Provide quality education especially to factory workers on proper hygiene and
safety
 Waste Management
o Recycle the industrial waste before discarding out of the factory
o Use of better-quality inputs which reduces waste of defective final products
 Environmental Responsibilities
o Less use of paper for printing and office use
o Avoid use of plastic bottles and encourage employees to use paper cups or bring
their own metallic bottles.
o Lesser use of electricity and adoption of Solar and other less polluting technology
for energy needs.
 Community Responsibilities
o Better provision of goods and services to the community at large
o Creating a charitable foundation and contributing to cause of fighting Pandemic
like COVID-19
 Stakeholder responsibilities
o Better employee retention and relationship
o Increased returns to the shareholders
o Timely payment to suppliers and favorable credit terms

Strategic implementation

We see the five variables for the Corporate Social Responsibility of ASSENT above and how it
can be further improved by the company. Here we try to carve out steps in its strategic
implementation.
 Waste Management
o Recycle the industrial waste before discarding out of the factory – Recycling of
industrial waste can be very easily implemented by having a corporate policy and
putting controls in place. The factory supervisor should be responsible for
ensuring that the fixed percentage of industrial waste is recycled and reused in the
production and the waste discharged is below the hazardous limits approved by
the Dubai Municipality. The Municipality levies fines on companies not adhering
to the pollution levels.

o Use of better-quality inputs which reduces waste of defective final products –

There is the famous saying that we buy quality once and its lasts longer.
Similarly, the company’s procurement policy should be amended to include a list
of vendor and suppliers that have a reliable quality certification for proving any
inputs the company needs. The low-quality products can lead to more waste and
defects for the company. The purchase manual should be amended and only the
approved vendors should be issues Purchase orders by the management and the
right approvals should also be in place.

 Environmental Responsibilities
o Less use of paper for printing and office use – Implementing this plan is very easy
and simple. The Corporate admin and HR teams should put in the manual a
requirement to only print when necessary. The HR can also have a system to
count the number of pages printed per employee and question any employee if
they are printing more than necessary. Paper contributes to a great amount of land
pollution because a lot of trees are cut to make paper in factories.
o Avoid use of plastic bottles and encourage employees to use paper cups or bring
their own metallic bottles – ASSENT should with immediate effect stop
supplying bottled water to employees and should encourage them to bring bottles
from home and fill water from the office canteen as and when required. This will
avoid plastic waste to a great extent.
 o Lesser use of electricity and adoption of Solar and other less polluting technology
for energy needs – The company should have a policy to encourage employees to
switch off their laptops or desktops before leaving for the day. This will consume
lower electricity. The air-conditioning in the office and the factory should also be
monitored and temperature be adjusted according to the external weather to avoid
wastage of electricity.

Proposed CSR benefits

The benefits of implementing the proposed CSR and its improvements are as follows:

a) Reduced operating cost – The reduction in waste and overhead cost will have a direct benefit
on the P&L of the company and it will lead to lower operating costs which will lead to a higher
profit.

b) Boosts employee morale – Employees love to work for a company that is taking care of
environment and is sensitive to the needs of the society. They will feel more cared for and there
will be sense of belongingness and commitment level will increase thus reducing the cost of
recruiting employees.

c) Better quality products and brand recognition – Waste management implementation means
lower defects. Customers will always prefer products that are durable and are known for their
quality. Today, customers are ready to pay a premium for any product if it is of a very high
quality. This will in a way enhance the brand image of the company in the long run.

Conclusion

ASSENT as a corporate group has been having a very active CSR policy and has a manual to
implement CSR at the group level. It belongs to ASGC group which has been a pioneer in CSR
and has received several awards in the past including CSR Label in 2015 from the Dubai
Chamber. Implementing CSR is the need of the hour given the importance it holds in the society.
The company as the corporate citizens have a moral and economic duty to repay back to the
society from which it has gained over the years in the form of Corporate Social Responsibility.
ASSENT has a CSR policy based on the five variables and there are improvements needed in
them which has been highlighted in this paper. The benefits of CSR far exceed the cost of
implementing CSR. Although some companies face issues with budget and manpower to
thoroughly implement CSR, the need of the present times is to explore ways on how to
implement CSR and ensure that benefits are realized in the ling run in the form of higher profits
and better brand value.

References

 https://www.sciencedirect.com/science/article/pii/S2092521216300062
 https://www.researchgate.net/publication/228190389_Corporate_Social_Responsibility_
An_Issues_Paper
 https://www.zawya.com/uae/en/pressreleases/story/Al_Shafar_General_Contracting_Co_
LLC_awarded_the_prestigious_Corporate_Social_Responsibility_CSR_Label_by_the_D
ubai_Chamber_for_Responsible_Business-ZAWYA20150401085944/
 https://www.assent.ae/
 https://www.asgcgroup.com/