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zouhair abdul khaliq

csr talk

The Three Magical The Neo-Pakistani Responsibly Yours Whose Ethics?

INSIDE
& Misused Letters: Incubator Importance of LDC’s
CSR Participation in CSR
PAGE 11 PAGE 16 PAGE 18 PAGE 22

A publication of Asiatic Public Relations Network (Pvt) Ltd.


regulars
global briefs
8
contents
csr talk
20
breather
29
social partnership
32
book in focus
34
musings
40

cover story cover illustration by umair anwar

the three magical


... letters:
by khadeeja balkhi
csr
The triple bottom-line concept forms the most common
quantifiable gauge and driving mechanisms of CSR. The
idea is that businesses can add value to society in three
ways: economic, social and environmental. The triple
bottom-line is a wide set of economic, environmental and
social parameters used primarily to drive and measure
an organisation's value creation as a corporate citizen.

2 www.triplebottomline.com.pk
features editor-in-chief
zohare ali shariff

cover story 11 editorial director


16
khadeeja balkhi
csr toolkit
managing editor
responsibly yours
18 rutaba ahmed

whose ethics?
22 research
raza tahir
renaissance brand
26 shumaila sadruddin

essential csr
30 creatives
sadia hussain

36
kamran rauf
rise and rise of csr umair anwar

reprint
csr: serious or just
a trendy fad? 39 in line with our mission,
we encourage reproduction of
material, provided tbl is given credit
subscription, advertising and
feedback at: publisher
asiatic public relations (private) limited

tbl: triple bottom-line


printed at
Address: A-7, Street 1, nikmat printers, karachi
Bath Island, Clifton,
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Tel: (92-21)-5837674, 5823334 disclaimer
Fax: (92-21)-5867103 the views expressed in tbl are the
E-mail: tbl@apr.com.pk authors’ and not necessarily shared by
Web: www.triplebottomline.com.pk tbl and/or APR

tbl is available at bookstores and magazine-


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Subscribe to a full year of tbl (6 issues) at the from the office of
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If you wish to subscribe to tbl, or unsubscribe,
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please write to us at tbl@apr.com.pk

Jan / Feb 2008 3


editorial advisory board

welcome on board
The tbl Team is honoured to introduce Habiba Hamid – Member
our editorial advisory board. Comprised Founder of Saracen Consulting,
of diverse leaders and practitioners, a corporate governance and
our goal is that the board will steer our responsibility consulting
firm. Currently articulating the
efforts to their highest potential. Dubai Model of sustainable
development. Based in Dubai.

Anwar Rammal – Chairperson


Chairman of Asiatic Public Ayesha Tammy Haq –
Relations (Pvt.) Limited, Member
Pakistan’s leading communi- Corporate lawyer, legal and
cations and PR agency, affiliated media consultant. Concurrently
internationally with Hill & a freelance journalist and host of
Knowlton. Also Chairman of JWT, a weekly current affairs television
Pakistan. Based in Karachi. programme. Based in Karachi.

Khadeeja Balkhi – Member Abrar Hasan –


Sustainability and CSR consultant Founder Sponsor Member
and internationally experienced
Chief Executive of National
business and gender journalist.
Foods Limited, Pakistan’s
Based in Karachi.
pioneering multi-category food
company. Innovative busi-
nessman and industry leader.
Based in Karachi.

Khawar Masood Butt –


Founder Sponsor Member
Chairman and MD of English Vivian Lines – Member
Biscuit Manufacturers (Pvt.)
Limited, Pakistan’s leading President and Chief Operating
biscuit company. Entrepreneur Officer of Hill & Knowlton’s Asia
and business visionary with a Pacific Region and concurrently
firm commitment to CSR. Based President and CEO Southern
in Karachi. Asia. Based in Singapore.

vision and mission


Vision: To steadily facilitate the germination of sustainable visions for organisational growth, sharing specific
triple bottom-line knowledge and tools

Mission Statement: To disseminate triple bottom-line knowledge to a diversified group including corporate,
social development and general business groups primarily through a specialised journal, expanding in
accordance with organisational capacity and market readiness

4 www.triplebottomline.com.pk
acknowledgement
The tbl team expresses its profound
gratitude to the companies whose names
appear below, for their agreement to
support this publication. Bringing out a
The term ‘Triple Bottom-Line’ (TBL), which translates
into “People, Planet, Profits,” captures an expanded knowledge-based publication like tbl
spectrum of values and criteria for measuring involves considerable effort and costs. It
organisational (and societal) success - social, may not have been possible to bring out
environmental and economic. tbl in its present format without the
invaluable support and contribution of
Through our masthead we personify the term TBL. our Founder Sponsors.
Essentially, our ‘bottom line’ is a grey bar with a
burgundy border which runs through the masthead,
at some points overlapping the letters and running Through their support to tbl our corporate
under them at others. Here ‘t’ stands for triple and sponsors have confirmed that they share
is represented through the three shades of the letter. our Mission of disseminating triple
The ‘b’ stands for bottom and it sits below our grey bottom-line knowledge to a diversified
line with the line going through it - since this magazine group including corporate, social
is a below the line activity, the two gel in together. development and general business
The ‘l’ stands for line and the letter sits comfortably groups. We believe that helping to spread
on top of the grey ‘bottom’ line.
awareness of true CSR is in itself an
element of CSR. By becoming our
sponsors, the following companies have

mr tbl
taken that vital first step with us in our
journey to facilitate awareness and
understanding of true CSR in our country:

Mr. Tanveer B. Lone is indeed a busy


man, laden with his struggle for the National Foods Limited
truth in the Sustainability industry. His Founder Sponsor
first name, Tanveer, according to our
wonderful Ferozsons Urdu-English
dictionary means 'illuminating'. We
feel he is sometimes the seeker of
enlightenment, and at others, the
seemingly lone bearer. Driven towards
his destination – the true light of CSR English Biscuit Manufacturers
– he sometimes feels like a lone voice (Private) Limited
buried amidst the complex factors he
Founder Sponsor
confronts on the way. Yet as he sets
forth, oft-alone on this journey, he
knows he will meet companions along the sub-paths
his journey takes, merging at destinations common with
him. There will be occasions where we can all relate
to him. At times, though his capitalist-training-bred
financial focus may fluster us and his understanding
towards disseminating the true implications of the triple Engro Chemical Pakistan Ltd.
bottom-line. Feel free to share ideas with Mr. TBL that ENGRO CHEMICAL PAKISTAN LIMITED Co-sponsor
might help clear the oft-murky waters he'll encounter
in his expedition at tbl@apr.com.pk

Jan / Feb 2008 5


editor’s note

giving csr
a direction
C orporate Social Responsibility must rank as
a front-runner buzz-phrase of the new
Millennium. Everyone mentions it all the time.
capable of constructing. There is a need to clearly
understand the various dimensions of CSR and
adopt best practices in this field, just as corporate
Certainly the principal actor itself, the corporate entities endeavour to follow best practices in core
sector. And others: the NGO sector, the government, business operations. A greater understanding of
international institutions, the media and increasingly, the subject is valuable not only for the corporate
the general public. But CSR, with or without its sector but for all stakeholders: the government as
trendy terminology, has been around for a lot longer the legislator, regulator and facilitator of transparency;
than the little over seven years of the present century. the business brains who kick-start the process; the
It just did not come into the public debate domain vendors and contractors who must begin to think
as much as it does now. how to supply sustainable materials; NGOs and
NPOs as platforms for the voice of the general
As is quite common in cases where a subject public; and the media and other informers key to
becomes a hot topic, so too in the case of CSR. keeping society responsibly informed and poised
There are now a number of opinions as to what for sustainable lifestyles and actions. The credible
CSR is or should be. Even the term corporate social practice of CSR indeed permeates multiple tiers.
responsibility is by no means universally used,
although it is getting there. A shortened, popular As stakeholders delve deeper into the subject, the
version is corporate responsibility or simply CR. insight may well emerge that CSR could actually
Then Social Action Programme or SAP is another be CSO or Corporate Social Opportunity.
term with some following, particularly in the non-
profit sector. Contributing to the promotion of a It is vital to the success of our vision that you, the
universal nomenclature, this publication will go by readers, play a proactive, participatory role in sharing
the most widely accepted terms, Corporate Social CSR-related learnings. CSR is evolving rapidly and
Responsibility or Sustainability. the more that people get involved in this process,
the greater and more widespread its understanding
What CSR is and what it isn’t will not be told in this will be.
editorial. There is space enough for this in the inside
pages and in our issues to follow. Let readers start Welcome to the first issue of tbl.
off with whatever definition of CSR they hold, and
then process what TBL has to say. Which brings
me to the rationale or passion behind this Sincerely,
publication’s birth.

Our overarching objective is to be a responsible


vehicle for the dissemination of information and
knowledge about CSR, which we see as a prime Zohare Ali Shariff
example of the win-win models the human mind is Editor in Chief

This publication is being sent complimentary to 1500 decision-makers and opinion-formers in the corporate
sector, the government, NGO sector, international institutions and academia. Recognising that your sphere of
work has the potential to compliment and reinforce the essence of our mission, we have taken the liberty to
present tbl to you. It is also available at selected bookstores and other outlets.

We would love to hear from you. Please do contact us at tbl@apr.com.pk with your thoughts, feedback and
input from your corporate or social practices.

tbl strongly believes in knowledge dissemination and sharing. Please feel free to share tbl contents with your
peers and teams - of course we know you’ll give tbl the credit when you share our work.

6 www.triplebottomline.com.pk
What do the following
companies have in common?

Atlas Bank

ENGRO CHEMICAL PAKISTAN LIMITED

HUBCO
growth through energy

p r o t e c ts w h a t ’s g o o d TM

Their Public Relations Agency

Asiatic Public Relations Network (Pvt.) Ltd.


Karachi - Lahore - Islamabad

HILL KNOWLTON

A-7, Street 1, Bath Island, Clifton, Karachi, Pakistan. T 92-21-5837674, 5867576, 5372402 F 92-21-5867103 E apr@cyber.net.pk www.apr.com.pk
people

global briefs
First ever systematic set of Consumer Action Guide to healty
global human rights risk indices toys
launched
H ealthyToys.org, launched recently
by the Ecology Center, is based
M aplecroft has launched an
innovative set of 25 human rights
risk indices for 20 different sets of
on research conducted by several
environmental health organisations
human rights violations, to bring greater and researchers around the country.
understanding and policy focus to the HealthyToys.org aims to address the
field of business and human rights. failures of the current regulation system
Maplecroft, founded in 2001, is a -laws and policies - to regulate toxic
specialist research and advisory chemicals in toys and other products,
company with strong corporate client and to set requirements for full testing
base and research partnerships with of chemicals before they are added to
leading international organisations, most consumer products, including
such as those within the auspices of children's toys. Sustainable City Awards are one of six
the United Nations, the World
Economic Forum and prominent The current regulation system fails to UK feeder schemes to the European
independent non-governmental provide adequate assurance and Business Awards. The Awards were
organisations. information to consumers about established in 2001 by the City of
chemical components in children’s London and are led in partnership with
The set of human rights risk indices products that may be harmful for health. 15 organisations, including livery
includes different types of violations Despite awareness concerning the companies, trade bodies, voluntary
and their risks to business within three dangers of lead and other toxic sector organisations and businesses.
broad categories: human security; chemicals, manufacturers are allowed These awards aim to recognise and
labour rights and protection; and civil to, and continue, to use them in toys reward best practice in sustainability,
liberties and freedoms. Compilation of and other children's products. The only across the three pillars of sustainable
all indices is carried out through U.S. law restricting lead in toys applies
meticulous analysis of published development: the environment, social
only to paint. Children's jewellery is
human rights violations worldwide. ineffectively regulated, and jewellery issues and the economy.
with high levels of dangerous chemicals
Every business and organisation needs is commonly found on store shelves. The Sustainable City Awards have
to understand the risk it runs of being remained at the top of their field for
complicit with human rights violations. HealthyToys.org conducted tests on five successful years and are
Reputational risks arise from different over 1,200 children's products and constantly re-invented to include new
human rights issues and different more than 3,000 components of those awards and categories every year to
aspects of businesses; for example, products, and these have verified that better reflect current issues in the field.
purchasing of goods and services, some toys contain a significant
sales, logistics, marketing and human percentage of hazardous chemicals The Awards are open to business,
resources. The Maplecroft set of including heavy metals such as lead
human rights risk indices provides a public and voluntary sector
and cadmium.
comprehensive insight of human rights organisations. Past winners include
issues to enable businesses to assess Currently, the U.S. government and BT, British Land, F&C Asset
their risk of complicity. U.S. toy manufacturers do not provide Management, Sainsbury’s, U Can Do
such data to consumers. I.T., the London Cycling Campaign and
The Maplecroft Global Report contains HealthyToys.org has taken the first HM Prison Services. The overall winner
quantitative measures such as country essential step in raising awareness of the 2007 Sustainable City Awards
report cards and detailed country and providing information to consumers was the London Fire Brigade for its
human rights risk briefings which so that they are able to make informed initiatives to reduce carbon emissions
enables organisations to benchmark and better choices when purchasing
by up to 1,900 tonnes, which have
a country and gain a better toys and other children's products.
understanding of issues at stake. This included electric cars, roof-mounted
information enables companies to wind turbines and photovoltaic cells.
easily assess and plan their supply- Awards recognise and reward The Sustainable City Awards
chain auditing, investment decisions, sustainable best practices categories include Sustainable and
distribution profile and day-to-day Ethical Investment and Asset
operations. The set of human rights
risk indices allows companies and
businesses to manage non-financial
S ustainability awards are a wonderful
way of recognising, rewarding and
Management, Sustainable Travel and
Transport, Climate Change, Resource
performance and implement a strategic thereby promoting best practices in Conservation, Sustainable Buildings,
approach to CSR. sustainability. The European Business Access to Goods and Services for
Awards for the Environment, organised Disadvantaged Communities,
by the European Commission, play a Sustainable Procurement, and Environ-
vital role in demonstrating progress on mental Improvement in Small &
environmental and sustainable Medium-Sized Enterprises.
development issues worldwide. The

8 www.triplebottomline.com.pk
planet global briefs

The natural refrigerant used in the units is the latest step in its commitment to
Coca-Cola will provide is CO2 a clean and green energy future.
refrigerant.
World’s largest Future Energy
The company has provided HFC-free Summit
refrigeration units at both the Athens
2004 Olympic Games and the Torino
2006 Olympic Winter Games. The T he World Future Energy Summit,
the world's largest conference and
Beijing 2008 Olympic Games will mark exhibition on renewable and future
the first time that 100% of the coolers energy solutions, innovations,
and vending machines provided by investments, policy and vision - was
Coca-Cola to all official venues of an held on January 21 - 23, 2008 in Abu
Olympic Game will feature Dhabi. The summit was organised and
hydrofluorocarbon (HFC)-free hosted by Masdar, the world's first
insulation, HFC-free natural refrigerant, zero-carbon, zero-waste, car-free city,
and a proprietary technology called being built in the desert in Abu Dhabi.
Energy Management System (EMS) Launched in April 2006 by Abu Dhabi,
that improves energy efficiency by up Masdar is a global cooperative platform
to 35%. for open engagement in the search for
Beijing 2008 Olympic Games to solutions to some of mankind's most
have HFC-free refrigeration units Commitment to a clean and pressing issues: energy security,
climate change and truly sustainable
green energy future: RE<C
C oca-Cola, the world's largest non-
alcoholic beverage company, has
oogle has initiated a project called
human development.

committed to focusing on expanding


use of innovative refrigeration
G Renewable Energy Cheaper Than The event included a wide range of
networking events and conferences,
Coal (or RE<C), to develop electricity
technologies to reduce its carbon covering an extensive range of issues
from renewable-energy sources
footprint and increase the sustainability looking at World Future Energy Policies
focusing on wind, solar, and geothermal
o f i ts b u s i n e s s . C o c a - C o l a ’s and Strategies, Making It Happen –
power that will be cheaper than energy
commitment is to use climate-friendly projects, technologies and commercial
produced from coal. Making electricity
coolers and vending machines in all realities, and a number of streams
produced from renewable energy
official venues of the 2008 Olympic focusing on carbon management,
cheaper than coal would be a key part
Games to be held in Beijing and six waste to energy, solar, wind, biofuels,
of reducing global greenhouse-gas
co-host cities throughout China. clean transport, green property and
emissions. Google plans to heavily
Calculated based on an expected ten- sustainable architecture.
fund and allocate hundreds of millions
year life span of the units, the
of US dollars on research and There was a large international
approximately 6,350 climate-friendly
development on renewable-energy exhibition which filled 4 halls within the
refrigeration units to be placed by Coca-
technology, in 2008 alone. The RE<C new Abu Dhabi National Exhibition
Cola in the venues reduces
project will focus initially on advanced Centre. There were over 200 exhibitors
greenhouse gas emissions by
solar thermal power, wind power including pavilions from Germany, UK,
approximately 45,000 metric tons.
technologies, enhanced geothermal Japan, China, Austria and the
systems and other potential Netherlands, and a number of feature
Coca-Cola has been working together
breakthrough technologies. RE<C is areas offering educational and
with Greenpeace to develop and
hiring engineers and energy experts business development opportunities.
commercialise climate-friendly
to lead its research and development
refrigeration equipment and to advance The Summit brought together the
work to explore alternative energy
sustainable refrigeration, since the world's leading innovators, educators,
sources.
Sydney 2000 Olympic Games. Coca- scientists, venture capitalists and
Cola has invested nearly $40 million experts in the field of future energy –
Google will work with a variety of
in research, development, testing and people who are champions and
organisations in the renewable energy
deployment of sustainable refrigeration catalysts in creating sustainable
field, including companies, R&D
equipment. According to the United solutions. There were over 80 VIP
laboratories, and universities. For
Nations Environment Programme, speakers from around the world,
example, two companies that
HFCs are potent greenhouse gases including Ólafur Ragnar Grímsson,
Google.org is working with are solar
and some HFCs are 11,700 times more President of Iceland; Philippe Boisseau,
power and wind turbine companies
harmful than carbon dioxide (CO2) President Gas & Power, Total; Lord
eSolar and Makani Power, which are
emissions. Greenpeace has been Browne, Managing Director, Riverstone
already business partners of Google.
campaigning for the phase-out of HFC Holdings LLC and HE Mohammed
air-conditioners and refrigerators since Saeed Al Kindi, Minister of Environment
Google has been involved with several
the early 1990s. Through extensive & Water, UAE.
projects focusing on energy efficiency
research and development, CO2 and
and making its business environ-
hydrocarbons have been identified as
mentally sustainable. The RE<C project
climate-friendly natural refrigerants.

Jan / Feb 2008 9


profits global briefs

All state-owned companies to file of addressing environmental


GRI-based sustainability reports: challenges such as climate change
and global warming. It will be the driving
Swedish Government force behind global efforts to improve
the environment.
T he Swedish Government has
announced new requirements for Finance industry sets higher
external reporting, that require all 55
state-owned companies in Sweden to
sustainability standards for
file an annual sustainability report project financing
based on the Global Reporting Initiative
(G3) Guidelines before the 31 March
each year from 2009, in order to
HSBC, one of the largest banking
and financial services
improve the sustainability performance organisations in the world, is
of state-owned companies and ensure introducing new initiatives to reduce
transparency in the use of public the environmental impact of its day-to-
money. Sweden is the first country day operations, and to ensure that
worldwide to introduce requirements project financing is done in a
for sustainability reporting of this nature sustainable fashion. HSBC applies a
by its state-owned companies. Sustainability Risk Framework which
includes a set of policies including the
The “Global Reporting Initiative” (GRI) Equator Principles, a set of voluntary
Investment Corp., ICAP and guidelines developed for assessing
is a large multi-stakeholder governed Constellation Energy. The exchange
institution made up of a network of and managing sustainability risks
is the first time an emissions bourse (environmental and social risks) which
thousands of experts worldwide, who has brought together all the potential
participate in GRI’s working groups arise when financial support is provided
players looking to trade greenhouse to clients.
and governance bodies, use the GRI credits, including traders for oil, power
Guidelines to report, access and gas companies and agriculture The Equator Principles have become
information in GRI-based reports, or and financial futures traders and a global market standard based on
contribute to develop the Reporting bilateral traders. best practice, and have achieved a
Framework.
critical mass of participation, with 54
The Green Exchange will offer a banks as signatories, and cover 90%
The GRI G3 Sustainability Reporting comprehensive range of environmental of global project finance transactions.
Guidelines are the world's most widely futures, options and swaps contracts Adoption of Equator Principles by
used and recognised sustainability focused on solutions to climate change, banks reflects their commitment to
reporting framework, and provide renewable energy, and other report publicly about their
companies with an excellent internal environmental challenges. It will begin implementation process and
management tool. Adopting these trading during the first quarter of 2008, experience, and the number of
Guidelines enable companies to and will be regulated by the U.S. transactions that are screened.
enhance their brand, reputation, C o m m o d i t i e s F u t u r e Tr a d i n g
marketplace differentiation from other Commission through the NYMEX. HSBC recently took its reporting on
companies and gives them a the Equator Principles to a new level
competitive edge over companies not The Green Exchange initially intends and established a new industry
reporting. to offer trading in global carbon-based standard when it had its adherence to
contracts, such as carbon allowances the principles independently verified
under the European Union Emissions by Det Norske Veritas Certification BV
NY launches the Green Exchange Trading Scheme, carbon credits under (DNV), an international provider of
the U.N. Clean Development certification services. This decision to
ew York Mercantile Exchange
N parent Nymex Holdings Inc., the Mechanism, and verified greenhouse
gas emission reductions used in
have a third party audit was taken to
ensure greater transparency and
world’s largest energy exchange, and accordance with voluntary carbon
a group of Wall Street trading houses assurance. HSBC has been the first
standards. It will also offer contracts bank to take this step. Jon Williams,
have announced launch of an for U.S. SO2 and NOx emissions
Environmental Exchange, also known Head of Group Sustainable
allowance trading programs, as well Development HSBC Holdings believes
as the Green Exchange, for trading as contracts for national Green-e
environmental products, including that, “this will be part of a broader trend
certified voluntary renewable energy of increased reporting and independent
carbon credits. Green Exchange certificates.
partners include heavyweights such verification of non-financial data”, and
as Evolution Markets Inc., Morgan other financial institutions will follow
The Green Exchange promises to be
Stanley Capital Group Inc., Credit suit.
a powerful initiative for leveraging
Suisse, JPMorgan, Merrill Lynch, Tudor financial markets, which is a vital part

10 www.triplebottomline.com.pk
cover story

the three magical -and misused- letters: csr


by khadeeja balkhi
for tbl

“
letters. And the corporate masses concept, the Brundtland
I must warn you not to are buying it - for the most part. Commission drafted among the
allow your actions to be guided We must equip ourselves with first definitions that helped
by ill-digested information or the knowledge to decipher the popularize sustainability; in 1987
slogans and catch-words. Do truth of what is applicable to us. it defined sustainable
development as: "meeting the
not take them to heart or repeat

”
CSR 101 needs of the present without
them parrot-like.
compromising the ability of future
Mohammad Ali Jinnah, during an address To some, CSR is more accurately generations to meet their own
at Islamia College, Peshawar, April 1948 called corporate responsibility, needs".
CR, since the concept goes well

A sSocial
discussions on Corporate
Responsibility (CSR)
beyond social responsibility and
is significantly technical in nature.
The UN-commissioned
Brundtland Report then inspired
regress, the need for Yet the three letters remain the the 1992 Earth Summit in Rio de
understanding the beautiful most popular name, globally. Janeiro that resulted in the
concept of CSR becomes Climate Change Convention and
increasingly urgent. Not only is Although used interchangeably, in turn the Kyoto Protocol. At its
CSR misunderstood, a variety of CSR can be seen as the most recent twentieth anniversary
individuals - well-meaning and popular manifestation of celebrations, many capped that
otherwise - are realising that they sustainability: A subset of the Brundtland Report was
can rather conveniently stuff their sustainability. While sustainability instrumental in injecting
agendas into these three magical is a broader, more interconnected, e n v i r o n m e n ta l a n d s o c i a l

Jan / Feb 2008 11


cover story

consciousness into select, mainly or indirectly, by the actions of an from internal teams as well
Western, political mainstreams. organisation. A business entity upstream and downstream
However, true sustainable can then be used as a wider partners. It also has to be careful
development has been achieved vehicle for coordinating of the disconnect that occurs
"to a very limited extent indeed" stakeholder interests, instead of when the overall human
- as John Elkington, founder of maximising owner benefit alone. resources of the company have
SustainAbility and the triple little understanding and ownership
bottom-line concept, put it. of CSR yet higher management
In an increasingly thinks it is firmly committed to a
As a definition of CSR, though, discerning world of set of strategic values that
the International Finance investors and embody corporate responsibility.
Corporation prefers: "the consumers, a company
commitment of businesses to Staff enabled to live CSR as a
must harness a CSR
c o n t r i b u t e t o s u s ta i n a b l e routine business value will
strategy to consolidate guarantee that the company
economic development by
and streamline pursues responsible profits and
working with employees, their
families, the local community and
company-wide that its operations do not
society at large to improve their economic, adversely impact people or the
lives in ways that are good for environmental or planet; thereby negatively
business and for development". safety and social impacting its own self in the long-
term for sure. This ingrained staff
initiatives.
Sustainability requires a balancing mind-set comes from the process
of the triple bottom-line of continual self-analysis and self-
opportunities, risks and Why Do Companies Want In? development, often facilitated by
implications of action – all within external experts who can also
the context of the needs of current From a business perspective, offer objective feedback and keep
and future populations, as well Sustainability is how businesses the process streamlined and
as the limits of the ecological stay competitively viable in the focused. Routine actions that
system. long-term. In an increasingly embody the 'People, Planet,
discerning world of investors and Profits' corporate responsibility
The triple bottom-line concept consumers, a company must motto require invested and
forms the most common harness a CSR strategy to sustained effort.
quantifiable gauge and driving consolidate and streamline
company-wide economic, Every type of business bears the
mechanisms of CSR. The idea is
environmental or safety and social onus to survive in the long term:
that businesses can add value to
initiatives. to be sustainable. Financial
society in three ways: economic,
institutions for example often find
social and environmental. The
Industrial operations, for instance, it difficult to implement more than
triple bottom-line is a wide set of
no matter how scrupulous in their just corporate philanthropy. The
economic, environmental and
factory operations, leave a positive domino-effect of starting,
social parameters used primarily
significant environmental footprint. for instance, with factoring
to drive and measure an
Here a CSR strategy would help environmental and social criteria
organisation's value creation as
embed mechanisms that improve into their lending and purchasing
a corporate citizen.
efficiency of resources used, criteria as SRIs (Socially
The triple bottom-line ethos reduce wastage and so on - Responsible Investments)
demands that a company's thereby impacting both the institutions do is visible in many
responsibility and accountability economic and environmental areas. Not only will companies
be to 'stakeholders' rather than bottom-lines. know that in order to attract this
shareholders, particularly at the source of capital, they must be
cost of the former – with A company must believe in transparent in the triple bottom-
stakeholders referring to parties achieving its profits with integrity line, but it will help pressurise
who are influenced, either directly and demand the same standards governments and civil society

12 www.triplebottomline.com.pk
groups into fortifying institutions The reality however has been that much until it is often too late.
that promote and monitor ensuring a certain level of Which is also why companies can
responsible corporate behavior. financial return for shareholders get away with donating one
takes undue precedence over percent of only profits after tax,
“Because of the growing conscientiously compensating
demands in the markets in which not even total earnings, and be
employees or the scrupulous, and perceived as good corporate
they operate, and the demands sustainable, use of communities'
of their shareholders, citizens. Few stakeholders have
natural resources. This prece- historically questioned whether
multinationals face more and dence then manifests itself in a
more pressure to be responsible the companies' core business
variety of negative repercussions functions are ethical. Are the
for their operations in the various such as the over-repatriation of
countries where they operate,” products or services they're
profits to headquarter countries offering filling a need in society?
believes Alan Gegenschatz, without re-investing enough in
President and General Manager Or do stakeholders instead allow
countries where operations and a company to be ranked as an
of the courier company TNT profits originate. Or communities
Express, which employs more exemplary corporate citizen for
near industrial plants may find, its CSR strategies and ethics
than 160,000 people in 200 perhaps, that the effluents drained
different countries. “While Latin despite its spewing out products
into their water sources are that are a drain on society - such
America has most of the creating medical complications in
environmental resources on this as nutrition-less, preservative-
their children. ridden junk food?
planet, it [like Pakistan] suffers
from great inequality in the
distribution of wealth, leading to Corporate philanthropy This is not to imply that corporate
significantly high rates of poverty as practiced today is philanthropy is wrong. The
practice is as old as business
and unemployment. As a result, unsustainable -
the companies that we operate itself. The Pakistan Center for
anything a business Philanthropy found that almost
on this continent must adapt their
does out of goodwill fifty percent of Pakistan’s publicly
CSR policies to the prevailing
needs of these countries”.
alone cannot last. listed companies donate one
There is frequently no percent of their profits.
Companies in South America are true link between an
adapting to CSR at a fast pace. For example, according to a
organisation’s vision
Gabriel Berger, Director of the Pakistan Millennium Development
and its philanthropic Goals report, in Sindh more than
Social Responsibility Programme
at the University of San Andres activities. It is essential half of the children five to nine
in Argentina notes that “CSR has to have a vision for years of age are not enrolled in
been growing not only in philanthropic activities a school, despite a government
Argentina, but also in Brazil, Chile, as part of the overall primary school education
Mexico and Colombia”. In the rest programme across the province.
CSR strategy.
of the region influential corporate The findings suggest this lack of
organisations have been created. reach can be partially explained
The Business of Giving
In Argentina, however, there are by the scarcity of basic facilities:
no business organisations that Alas, most companies do not less than one-third of all
work exclusively in CSR; there realise the bottom-line impact government-run schools in the
are only non-profit organisations. CSR can have and instead, region have access to drinking
On the international level, she engage in it as a form of image water, electricity, boundary walls
adds, the phenomenon has management. Again, this surface- or even toilets. The Pakistan
grown in response to “consumers’ level involvement is possible Centre for Philanthropy’s (PCP)
expectations, to pressure by mainly because generating '3P's for Education' programme,
NGOs that monitor those goodwill from a relatively passive aims to increase social
companies and to moves made set of stakeholders is not very investment in education through
by investors”. difficult - they do not demand facilitation of linkages between

Jan / Feb 2008 13


cover story

corporate philanthropists, citizen and effective corporate The UNDP has been working with
organisations and the philanthropy may become, the the Pakistani corporate
government. Multiple-party primary goal remains to integrate community since 2003 to help
linkages such as this, when a higher level of consciousness establish the United Nations
thoughtfully created in sync with into companies' core business Global Compact, a forum for
a company’s core business model f u n c t i o n s . F r o m a t ta i n i n g corporate responsibility. A local
and not as charity work, set a meaningful Environmental Impact Karachi-based UNGC network
positive cycle in motion, one that Assessments to transparent alone has over 62 corporate
benefits all involved. public reporting, responsibility members.
must be integrated into every step
However, corporate philanthropy of businesses' actions. “As a partner of the Global
as practiced today is unsustain- Compact, UNDP is continuously
able - anything a business does Addressing root causes often may exploring opportunities of
out of goodwill alone cannot last. not be as visibly glorifiable or concrete partnerships with the
There is frequently no true link instantly rewarding but it is a private sector,” says Mr. Haoliang
between an organisation’s vision much more efficient and effective Xu, former United Nations
and its philanthropic activities. It use of corporate philanthropic Development Programme
is essential to have a vision for funds. Instead of treating Country Director, Pakistan. Until
philanthropic activities as part of symptoms of a community it the Global Compact Foundation
the overall CSR strategy. works with, a business must take becomes a reality, the UNDP also
Corporate philanthropy has often the time to engage with the directly engages the private
become, among many other community and identify root sector towards achieving national
bandwagons, a means to causes. For example, if it were development priorities and the
assuage the corporate to truly engage with the MDGs.
‘conscience’ instead of a subset community, a company may find
of an aligned corporate strategy. that setting up a water filtering The Foundation coordinates
system would have addressed projects such as “Community
It also seems that there is no way the cause of the community's Empowerment through Livestock
for businesses to please critics. kidney ailments whereas an Development & Credit” that
If they donate philanthropically elaborate kidney center would focuses on generating income
while they may or may not try to only address the symptoms and employment among rural
manage internal change towards without actually reducing the women through trainings and
improved corporate citizenship, occurrence of the ailments. skills development in primary
they get blamed for trying to livestock healthcare and
'greenwash' stakeholders. On the One –Among Many– Corporate management.
other hand, justifying the financial Responsibility Platforms
bottom-line of initial CSR The project recognises that only

“
implementation to shortsighted imparting skills is not enough for
shareholders can be a serious In today's world, the true empowerment. Women need
roadblock, while sometimes private sector is the dominant help marketing their services
perceived as a somewhat vulgarly engine of growth - the principal and/or products, especially if
mercenary to other stakeholders. creator of value and managerial culture prefers for them to stay at
And of course no one is happy resources. If the private sector home. This endeavour requires
with a company that simply earns does not deliver economic growth dairy companies to invest in their
p r o f i ts a n d d o e s n ' t f u l l y and economic opportunity - milk-supply networks, although
understand the ethics behind its they are currently sufficing. A
equitable and sustainable -
profits - because it is perceived positive ripple effect of this is
as not making an effort to earn around the world, then peace will including women into the
remain fragile and social justice

”
the license society granted it to economic activity their operations
operate in the first place. a distant dream. generate. However, it is their long-
Kofi Annan, term goal of competitiveness that
Regardless of how mainstreamed Former United Nations Secretary General enables them to realise that this

14 www.triplebottomline.com.pk
becomes a direct investment into and position their exports in global that address all the critical
building a more sustainable markets. There is a significant elements of the enabling
supply of raw materials for their opportunity for the public sector framework and create a deeper
future products. to harness business enthusiasm awareness amongst businesses.
for CSR to help achieve its goal
This indigenously sustainable o f r e d u c i n g p o v e r t y. T h e Stakeholders and consumers
economic empowerment creates challenge today for the public alike need to educate themselves
a win-win situation, for rural sector in developing countries is and invest in companies that will
communities, for the private to identify CSR and incentives leave a better tomorrow for their
sector that it serves as an that are meaningful in their children. The bottom-line
upstream vendor to, and for national context, and to play a message? Stakeholders, wake
development workers. role in strengthening appropriate up. Educate yourselves. After all,
local initiatives. the ultimate accountability is to
What Role Can the Government oneself. Individuals can continue
Play? A World Bank study concluded to vicariously live their lives
that governments have through the material possessions
In capitalist environments, the innumerable other reasons to they obtain as opposed to through
government must serve as the invest in developing sustainability their inner selves. Education can
principal regulator, protecting its frameworks – this was four years serve as a route to either
citizens against manifestations of ago when the industry was indeed destination.
inherent human ills, such as more nascent. The Public Sector
greed. And by placing so much Support for the Implementation As citizen-consumers we must all
emphasis on the obligations of of Corporate Social Responsibility demand our rights. Put your
the private sector, we certainly study found that such efforts are money only with companies you
don't want the government to feel likely to deliver economic and believe will leave a better
that it is let off the hook in some social spin-offs that contribute tomorrow for your children.
areas - no matter how disillu- positively to national competi- Institutions will not reform unless
sioned we may be with its bottom- tiveness. The report also stated you - the consumers, their
line ineffectiveness. that these frameworks provide a audiences - demand it of them.
level playing field for enterprises As daily consumers there are few
It is also vital for the government active in the country, thus needs that we could fulfil without
to vigilantly monitor those entities supporting much-needed at least three different entities
that enter a country for operations entrepreneurship. And finally, they spending billions on coaxing us
while its target markets are not p r o v i d e g o v e r n m e n ts t h e to meet our need through them.
within the host country. Such opportunity to have greater For a change let us capitalise on
businesses feel no obligation or influence over business outcomes the Darwinian competition
incentive to be vigilant to the than to simply react to characteristic of ‘free’ markets
needs of the citizens who are repercussions of business entities' and use it to our economic, social
contributing to its success. In this actions. The report is a wake-up and environmental advantage.
scenario it is entirely the govern- call for governments, especially
ment's responsibility to safeguard those of developing countries.
the interests of its people, both in
the short and long-term. The public sector plays a key role about the writer
as the principal over-seer of the
As a Sustainability
Governments are beginning to enabling corporate environment. Consultant, Khadeeja
view CSR as a cost-effective Developing country governments Balkhi helps
means to enhance sustainable are likely to be successful in organisations embed
development strategies, and as improving social and and document
sustainable practices
a component of their national environmental standards if they
into their core business
competitiveness strategies to develop coherent strategies, such models.
attract foreign direct investment as publishing codes of conduct

Jan / Feb 2008 15


csr toolkit

the neo-pakistani incubator


by salman abedin
for tbl

E ach region of the world has


its common problems, and
yet people in each country have
Entrepreneurial Spirit
However, this does not take away
Don’t Industrial Parks Cut it?
industrial zones, parks and other
from the fact that Pakistanis, like facilitational setups by the
found their own indigenous
many people in third world government are in place for
solutions to the issue of how small
countries, are imbued with an capital intensive industries
businesses should and can grow
inherent entrepreneurial streak. throughout Pakistan. However,
into mid-sized and then larger
This results from a lack of social no emphasis has been laid on
businesses.
support mechanisms, incubating startups. Pakistan
underemployment and a lack of Software Export Board’s attempt
Various models exist including
reasonable employment at setting up technology parks
bank financing, micro credit ala
opportunities for many. presupposes a certain
Grameen, Venture Capital (VC)
organisational size for park
and cooperative enterprises like
Over time, many communities facilities to be accessed.
those in India. Out of these, the
have developed strong cultures
most interesting one, and the one
of risk taking and business In any case, there seems to be
with greatest import in Pakistan
d e v e l o p m e n t . N o w, t h i r d no funding of any sort available
is the Incubation model.
generation entrepreneurs are to garage startups. Successful
present in the business space. garage startups have been made
Incubation Background
Some of these are well known on family savings or investment
Stanford, MIT and other tech Gujrati speaking families, and from angel investors, and even
universities in the United States some are not well known those have had difficulty in going
have perfected the Uni-Incubator- entrepreneurial clans from Central to the next level. Most die within
VC eco-system, and despite and Northern Punjab. Other 11 months - which is the rental
claims to the contrary, this system business clans such as Nagoris agreement period in Pakistan.
has not duplicated well, by and in Milk production (doodh-walas)
large, in other countries. and Pathans (tea shops) also Need for a Neo-Paki Incubator
exist in large numbers.
All things considered, there is a
Government-run entrepreneurial
development incubators exist in
other parts of the world, however, THE BIG IDEA
the objective of such setups is
more social development, rather
than economic.

Incubation Experience in
Pakistan
TMT Ventures, a pioneering
Pakistani VC company, ran an
incubation model for most of its
investments. However, the
incubator made the entrepreneurs
all too cozy, and resulted in low
performance of most incubated
companies. This may also be the
Businesses created Young rich kids
result of a non-existent VC eco-
Jugaroo entrepreneurs Handshaking organisation
system in Pakistan.

16 www.triplebottomline.com.pk
need for an incubation system company were to serve as the into productive enterprise
that allows startups to be created handshaking organisation to an building;
and with a strong hand to guide agricultural entrepreneur whose
them through the process of output would then become part 4. Breaking down group stereo-
growth. Since there is no of the HSO’s upstream supply types or socioeconomic
ecosystem to provide risk capital chain. barriers by making diverse
at the present time, the incubator people work together;
itself must be financially viable. Ideally this initiative would be
undertaken under the umbrella 5. Paving the way forward for
Target of an organisation akin to the similar institutions to be setup
Chamber of Commerce in in Pakistan and other
Pakistanis are by nature risk
association with VC firms, comparable developing
takers. Many who have access
SMEDA and other entities countries with comparable
to capital, especially those coming
interested in business value issues of business value
from family backgrounds where
creation, such as forward- creation; and
money is freely on-hand, are
thinking, CSR-based HSOs.
turning in large numbers to day
trading on the Stock Exchanges,
which to many is akin to a form
of gambling, requiring almost no
business acumen or Day Trader Funnel Grass Roots Business Person Funnel
“Young Rich Kids” “Jugaroo Entrepreneurs”
entrepreneurial risk-taking. Those
without capital, on the other hand,
are setting up businesses of all 300,000 3,000,000
sorts that sometimes succeed
and sometimes don’t.

A Funnel can be Created as


Follows
A group of people from different
segments can be attracted and 30,000 300,000
tapped to form the base of the
incubator. Funding for the
business idea will come from the
casually labelled “young rich kids”
segment, whereas the ideas will
mostly come from the “jugaroo 3,000
entrepreneurs” segment.

Who should do it? 300 300


The role of the incubator is mostly Incubation
that of a facilitator. The incubator
will also add value by training the
incubators in required business
skills.
In cases where further financing Advantages of the Neo- 6. Creating an ideal CSR
is required, the handshaker Pakistani Incubator initiative inroad for a variety
organisation (HSO) enters as an of businesses.
1. Channelising business ideas
angel investor. This is an ideal
that are lost due to a lack of
CSR inroad for the handshaking
funding;
organisation, creating a win-win
situation for itself and the
entrepreneur by serving both as
2. Training of youth or rural about the writer
entrepreneurs in business Salman Abedin is currently Executive
investor and downstream
management in a laboratory Director at Contract Advertising. He
partner/purchaser of the
environment; welcomes input and discussion on the
entrepreneur’s services. For model briefly inserted for TBL readership
instance, imagine the positive and can be reached at
3. Bringing well-heeled youth
repercussions for both if a food salman.abedin@gmail.com.

Jan / Feb 2008 17


beyond philanthropy

responsibly yours
by zohare ali shariff
for tbl

be defined by them as corporate


philanthropy at best. Cheque-
writing to use another, less
complimentary term that is also
applied. Of course the recipients
of the largesse are not bothered
what appellation you give to it.
But the donors insist it is CSR.
After all a commercial company
exists to make profits. So why
should it give away money (read
earnings) to some NGO? This is
done, they justify, because the
company is exercising corporate
social responsibility. The company
cannot itself set up and operate
for example a children’s hospital,
the argument further goes. It is

A t a recent fundraiser in the


city, one of those somewhat
each had been pre-sold several
weeks before the event itself. At
not its business. So it does the
next best thing instead and
surrealistic evenings replete with a hundred thousand rupees each, donates a sum of money to a
Caesarian trappings that the the tables had raised a cool crore suitable organisation that can be
excitement seekers gather at, the long before the DJ had played trusted to do just that – set up
scion of an industrial empire the first trance track of the and operate a children’s hospital.
outbid other birds of the feather evening. Thus the proponents of cheque-
to become the proud owner of a writing are very comfortable that
dress that a certain lascivious The party progresses and they are in fact giving something
actress had worn in a hit film of everyone has a good time. It’s a back to society and are hence
yesteryears. All for a good cause. win-win situation for all. A fun practicing CSR. If a strategic and
After all it was a fundraiser. Of evening paid out of corporate much sought after table for ten at
course those present who had coffers. The annual report will a highly desirable soiree comes
not participated in the bidding duly report x amount donated to their way in the bargain, then it
owing to comparatively lesser a charity working for the lesser is just coincidental.
resources pronounced the privileged under the company’s
highest bidder to be a pervert and corporate social responsibility Purists are not convinced. They
a bragger. No matter. The highest programme. CSR. Three letters think the driving force in such an
bidder is on a high with his new mouthed as often as CIA. Not instance is the urge to revel rather
acquisition and the ‘cause’ is that a connection is implied! than an altruistic calling to serve
delighted that the auction had humanity. For them ‘true’ CSR
gone well. Icing on the cake really, Subject specialists would not has a much deeper and complex
as the big bucks had already classify the payment made for meaning.
been made when the hundred the female garment mentioned
odd tables seating ten persons earlier as CSR. This action would Firstly, it should be an ongoing

18 www.triplebottomline.com.pk
and a long-term commitment and benefit society. Cheque-writing the programme, extending
not a one-off gesture that uses certainly helps, but the benefits beyond the financial into less
t h e i n s ta n c e a s a p h o t o may come at a cost that is beyond tangible but equally important
opportunity. And secondly, they the amount of the cheque itself. realms of human effort and
say, true CSR aims at bringing Costs in human terms that may cooperation. This, relating to the
about real and sustainable not be overtly obvious in the adage that companies exist to
change rather than providing only beginning. Any number of make profits, will in turn ultimately
temporary relief or, so to speak, negative forces may be at work. lead to greater return to the
merely being a bandage instead The credibility, honesty and company in terms of a more
of a cure. competence of the cheque’s empowered society, that will
beneficiary for instance. Even assure a market for future sales
The debate between the given that the beneficiary is doing of products or services that the
proponents of the two points of a ‘good job’, the question still company offers. At the ethical-
view can get quite extended. remains whether the beneficiary moral level the company
was the right choice to start with. becomes eligible to sign off its
What is important to understand CSR obligation as “Responsibly
though is that the two arguments This brings us to the concluding Yours, XYZ Corporation”.
are not contrary to each other. point. If a company’s CSR
Instead, the belief of the purists programme is conceptualized and
must be seen as a higher level planned to relate to its own core
of understanding of what CSR values and to its business, then
ought to be as it evolves and as a result two things will happen.
One, the selection of beneficiaries
about the writer
matures within individual
Zohare Ali Shariff is
organisations. And there is a very will have some logic behind it,
CEO of Asiatic Public
simple and logical reason why a leading to more efficient utilization
Relations Network
CSR programme must continue of the funds committed. And two, (Pvt.) Ltd., based in
to evolve and gain depth. The the company will have a much Karachi.
ultimate objective of CSR is to greater degree of participation in

about apr
Asiatic Public Relations Network (Private) Limited or APR, as it is popularly known, is a leading, independent
"CPR" (Communications & Public Relations) agency established in May 1992. Affiliated internationally with
Hill & Knowlton, the world's first global public relations and public affairs network founded in 1927, APR
is headquartered in Karachi, with other offices in Lahore and in the federal capital city, Islamabad and a
presence also in Kabul, Afghanistan.

APR offers its clients a comprehensive range of services aimed at achieving one key objective: Relationship
Excellence. Services offered include PR counseling; media relations; employee relations; strategic writing;
creative designing; publications; audio-visual productions; event management; community relations;
government relations and crisis management.

APR strongly believes in CSR being an essential business function of forward-thinking companies, with
a direct contribution to the sustainable development of both the company and the larger community.

www.apr.com.pk

Jan / Feb 2008 19


csr talk

Reshaping

lives
Khaliq shares
his personal and
professional passions

by khadeeja balkhi
for tbl

“Passionately,” responded permeate everything you do,” said company plans to invest an
Zouhair A. Khaliq, CEO Mobilink, Khaliq about his own ethos – additional half a billion in the
when TBL asked him how he personal and professional. To infrastructure in the coming year.
feels about CSR. “It is part of him everything is a manifestation
where we come from and a part of their philosophy: from the Talent
of our religion to look after our Pakistan-centric approach in their Of the remaining 10 percent, he
environment and our people,” he planning and imaging, to their estimates that almost equal
continued. socially inclusive products, to the amounts are invested in the other
fact that the drivers to the CEO two pillars: the people behind the
“If you look at it from the corporate all enjoy the same corporate company, and projecting the
perspective, when you work as cafeteria meals for Rs. 25. reality that they have worked hard
hard and long as we have and to fix.
have been blessed with the Trio of Success
success that we’ve had, it is only Khaliq delineated a three-pillar The company started five years
natural to feel that you want to strategy that spelt the success of ago with 500 people. “We have
give back.” To Khaliq, the Mobilink – and its profitable today 5,000 people who work with
company’s social investments are sustainability. This journey to us: brilliant, very talented
directly related to the communities success started about five years individuals. In 10 years, people
that have helped Mobilink be the ago. like us will be long gone - because
success story that it is today. we realise that this is for the long
Hi-tech Infrastructure term, we invest in the people we
“99.9 percent of our staff is Mobilink has invested heavily in hire today,” Khaliq said.
Pakistani,” Khaliq said. “When we their core service. He estimates
use local people, it encourages that over 90 percent of their “We have invested heavily in the
them, it’s an investment again – investments have been in this development of our teams,” he
we demand a lot of them.” area - about USD 2 billion in the said. The teams in turn help
past four to five years, and a total ensure the company’s success.
“Again, it’s a passion – it’ll of USD 2.5 billion to-date. The For instance, they help formulate

20 www.triplebottomline.com.pk
zouhair abdul khaliq

five and ten-year plans. To-date But instead of spending on types government bodies. For example,
each of the five-year plans have of public relations that simply add the company’s lady health worker
been exceeded – another gauge clutter to our environment, the programme is carried out in
Khaliq uses for their success, company prefers to keep its name conjunction with the Ministry of
combined with the reality that alive in communities by engaging Health and draws on the
Mobilink is the market leader. with them and providing core resources of the international
services that Mobilink can help GSM Association as well. The
“It is CSR to me: each and every provide through its newly- projects two current pilots aim to
ad campaign that you’ve seen established Mobilink Foundation, tool up the Ministry of Health with
over the last 10 years – has been initially endowed with Rs. 30 a handset when they travel out
devised, dreamt up and put in million from the Mobilink to rural areas they can connect
place by Pakistanis,” Khaliq said. Chairman, Naguib Sawiris – the back into their facility for medical
“The actors have always been first of its kind in the region for a advice, supplies or emergencies.
Pakistani. As have directors and telecom company, added Khaliq.
producers. We’ve never been to For the Mobilink PCO, the
Bangkok or Bombay; our ads are In the past 3 years for instance, company partnered with the
always shot in Pakistan”. the company has cut down its National Bank of Pakistan. The
billboard advertising to 20 cost of purchasing the Mobilink
Mobilink’s ‘reshaping lives’ slogan percent. “To be honest, we’ve not PCO, after vendor discounts, was
is truly embedded. They see it as missed that 80 percent,” Khaliq about Rs. 6,000, an amount small
a direct investment as well as a said. To him, this is an instance entrepreneurs often cannot afford.
long-term human capital of an integrated corporate Via an NBP-provided micro loan,
investment to work with local philosophy. The teams realise the cost of entry has been
vendors or agencies and then that part of their direction is to lowered from about $100 to $19.
demand high-level services from reduce clutter while creatively
them, instead of choosing to take keeping the brand alive. Measuring CSR RoI's
their business abroad. In a “I think it’s early days to start
humble way, Khaliq feels that the The Fourth P in PPP's measuring, in specific terms,”
company is helping them raise Although many businesses in Khaliq said regarding CSR Return
the bar in different sectors. developing economies are on Investments. The telecom
hesitant to enter multi-stakeholder sector faces extensive
Every team member of Mobilink frameworks, Khaliq shares the competition. “Everybody’s been
also volunteers their time and secret to his success with Public- out there pushing their products
skills, about 250-400 hours, Private Partnerships (PPPs). A and services, some have tried to
outside of their work hours – quality underrated by so many push only though lowered prices,”
another example of an immersed people, particularly in our oft-mad he said. Mobilink has never been
corporate ethos. professional rush: patience. He a price leader, but has managed
believes that “if you learn to retain almost 50 percent market
Imaging patience, there are so many share, despite the fact that some
“Once you have the reality on the things that you thought you people sell so much cheaper. “I
ground, you’ve got to project the couldn’t do and now you can, would like to think that it is also
reality,” Khaliq said, taking us to because you learned patience.” the image of Mobilink as
the third pillar: perception corporate citizen”, added Khaliq.
management. “It’s taken at least “I think it’s always a challenge to
the last two years towards shifting partner with anybody, especially “I think the constant refrain that I
the perception” following the with government which runs at a have is, as individuals and as
phases of ‘reality-management’. different pace; but if you want to corporations we need to
Behind an image or perception, do things right, it is imperative - recognise that it’s up to us to
you’ve got to fix the reality first, rather than to try and invest improve the environment that we
that’s why our focus has something in parallel, which would live in, the more we do for it the
predominantly been on just be squandering resources,” more we will see Pakistan
infrastructure, added Khaliq – with Khaliq candidly shared. flourish,” Khaliq shared as a final
only 5 percent of resources then note, adding that the prosperity
invested in projecting the hard- Most of Mobilink’s socially of Pakistan is proportional to the
earned reality. inclusive services, for instance, prosperity of our businesses.
are provided in conjunction with

Jan / Feb 2008 21


ethics

whose ethics?
importance of
LDC’s
participation in
CSR
by flavia thome
for tbl

T hestandards
ethical values and
that a business
Although still not as dominant in
less-developed countries (LDCs)
moral concerns and expectations
of their key stakeholders:
incorporates determine to an as in the developed world, CSR employees, customers,
increasing extent, its stature in has been making a big impact neighbouring communities and
society, and play an imperative across the globe. As an LDC shareholders (among others). As
role in maintaining and national, I am very encouraged a remedy to stakeholder concern,
encouraging public trust and by the positive potential of CSR. CSR policies must incorporate a
confidence in its products and However, I am equally concerned set of corporate moral values
services. In this sense, busi- about the ethical and cultural which take into account societal
nesses are playing an intrinsic imperialist tendencies of MNCs, notions of responsible moral
role in our lives, and it is only which are largely controlled by a behaviour.
logical that we expect more from handful of the world’s
them in terms of responsible and economically wealthiest nations. Questions that revolve around
ethical behaviour: behaviour that Can global corporations operate the nature of morality traditionally
reflects the values of the societies ethically across borders without concentrated on the actions of
businesses operate in. However, diminishing local culture and individuals but now the focus
the definition of what constitutes values? We must explore, as this includes the conduct of
‘right’ or ‘wrong’ is being article will, whether there are corporations. Relativists argue
continuously challenged as grounds for such concern from that notions of right or wrong differ
Corporate Social Responsibility the point of view of the host nation from one society to another and
(CSR) becomes increasingly and the extent to which ethical that no one culture is better than
prevalent in corporate activity. and cultural relativism is a serious another. However, across the
As global companies and local consideration for corporations spectrum, ethical absolutists
communities become more inter- implementing CSR policies in the believe in the existence of
connected, there is growing developing world. absolute ethical standards which
importance in challenging the determine what is good or bad
moral effects and consequences What is Right or Wrong? for all humanity. They would
of cross-border businesses and argue that a company should
the operations of multinational CSR is, to a large extent, a employ exactly the same
corporations (MNCs). response by corporations to the standards and attitudes abroad

22 www.triplebottomline.com.pk
as it does at home. This debate unethical behaviour relative to omiyagi in Japanese culture for
leads to questions pertinent to each society is becoming instance, is an intrinsic part of
the global community in which increasingly difficult to distinguish. business interaction, it symbolises
MNCs operate: are standards of If implemented correctly, CSR reciprocity and relationship
good and bad relative to the policies have the potential to do building although commonly
culture and place in which they much good in the world, misconstrued as bribery by
exist? Are values absolute or especially in LDCs where Western corporations and
could they change over time with governments and local institutions misinterpreted as wrong rather
each new generation, or are often weak. However, the than culturally relative. An African
management structure, for danger that CSR poses if Western perspective was offered by the
instance? If they vary, whose values are deemed absolute is Olusegun Obasanjo, the former
ethics should prevail? Should moral imperialism at the expense president of Nigeria when he
CSR practices presuppose the of undermining cultural and moral criticised the assimilation of the
existence of a universal set of differences across the globe. tradition of gift-giving into
values? The main ethical dilemma is corruption and bribery:

“
whose ethics should prevail when
Is the ‘Balance of Power’ values are in conflict? Should
Balancing? corporations invest in a foreign I can speak only for
country that does not allow Africa. But what holds true in
In the world of CSR, the influence employees to form a trade union?
my own continent may apply in
of ethical norms and differences Should corporations replicate
on cross-border business local practices of pay-offs and other parts of the developing
activities is a topic of heightened bribery? What about establishing world. I shudder at how an
controversy. The growing industrial plants in developing integral part of my continent's
acceptance of relativism – both countries which have lower
cultural and moral – is seeing a s ta n d a r d s o f l a b o u r a n d culture can be taken as a basis
shift in the ‘balance of power’. As environmental laws? for rationalising otherwise
CSR becomes more integrated despicable behaviour. In the
into business-models, attention Has Globalisation Endorsed
African concept of appreciation
must be drawn to the risk of Relativism?
imposing the moralities of the and hospitality, a gift is a token;
home country onto the host. For The more we interact with it is not demanded; the value is
example, a U.S. computer societies from distant parts of the in the spirit of the giving, not the
company conducted a training world, the more we challenge
course in a subsidiary in Saudi whether the values and codes by material worth. The gift is made
Arabia. The course included a which we live are true and in the open for all to see, never
case study where a senior absolute. After all, when we make in secret. Where a gift is
employee makes sexually explicit moral judgments we do so in the
remarks to a new female name of our own culture and excessive it becomes an
employee over drinks in a bar. beliefs. MNCs have to be aware embarrassment, and is returned.
Not only did the intended of local differences to avoid If anything, corruption - as
message of condemning sexual culturally cacophonic practices.
practised by exporters from the
discrimination or harassment feel
irrelevant to the local participants, A non-relativist approach to CSR north as well as by officials in
it led to confusion and offence imposes the homogenisation of the south - has perverted
because the norms governing standards, which may not be positive aspects of this

”
gender interaction as well as reflective of reality. An MNC
social outlets are very different expecting to face the same age-old tradition.
f o r t h e c o m pa n y ’s S a u d i challenges in a host country as
employees. at home, will often find itself This clearly illustrates the
unprepared in dealing with importance of context when
Multinational corporations have changing situations. Even if the evaluating different practices,
to consider the appropriateness problems are the same, the while ensuring that they do not
of respecting local culture and options available may differ. violate universal norms. The
adopting the moral vocabulary of An interesting example is the similarities in moral reasoning
the host country. A major concern case of gift-giving, a normal must be embraced to avoid
for corporations is that the tradition in many non-Western wrongness by those who use
distinction between ethical and societies. Sharing small gifts, the relativism to mask immoral deeds.

Jan / Feb 2008 23


ethics

Relativism: a Scapegoat for schooling, rural children would have to dig deep in our memories
Unethical Practices? have no other means of to find scandalous illustrations of
subsistence if not for the work negligent corporate behaviour
CSR has come a long way to they do in the farms. Without which has left a lasting harmful
protect local employees from understanding the local norms, a impact. The 1984 Bhopal disaster
exploitation by money-hungry corporation aiming to be in India exposed half-a-million
corporations. In the process it responsible and refusing to hire people to toxic chemicals during
has become clear that some such children can actually cause a catastrophic gas leak from a
activities are wrong wherever they damage to the society it tries to Union Carbide plant. The indus-
take place. The moderate form protect. The employment of trial disaster shocked the world
of relativism discussed here children should not be and raised fundamental moral
should not be misused as a unchallenged simply because it questions about corporate
scapegoat for oppressive regimes is common practice; instead it responsibility for accidents that
such as Mugabe in Zimbabwe, should be assessed in the context devastate human life and local
genocide by Nazi Germany or of the children’s well-being. environments. Union Carbide
corporate irresponsibilities such Attention needs to be placed on exploited lower local standards
as the use of forced-labour. the options and alternatives without compensating for the lack
Therefore, it is fundamental to available within the context of the in infrastructure. Although they
eradicate the justification for such local community. For instance, may have followed local
atrocities on the basis of ethical an alternative could be to provide environmental regulations they
or cultural relativism. Forced- schooling and financial aid for were far from complying with a
labour or abuse of workers should children of rural workers. Another responsible code of conduct
never be accepted because there route that works is employing which would have avoided the
is no society which will consider children, but only outside of accident. The question then
this behaviour morally correct school hours. Companies can becomes: if MNCs from
even if it is common practice. In work with educational non-profits developed countries operate in
a case reported by the United such as The Education and LDCs with inadequate
Nations Research Institute for Health Development Foundation environmental regulations, whose
Social Development, a fire in an in Islamabad, which recognises ethics should prevail? Once again
international company’s toy the reality that some children must the answer is relative to each
factory in Thailand killed close to work. EHD arranges separate context. As discussed in the case
200 employees because not only classes for working children of Bhopal, the decision by Union
did the management have a acknowledging that number of Carbide was clearly wrong as it
defective sprinkler system but it working children in Pakistan is in did not have a triple bottom-line
had also locked the workers the region of 11 - 12 million, but concern. Corporations must
inside the plant. There can be facilitates their inroads into a consider all their stakeholders
no justification for such immoral future brightened by the light of when making their choices.
and irresponsible corporate education.
action. Why Does the Debate about
CSR policies have great potential Ethical Relativism Matter to
A controversial yet interesting for good when they work in Business?
case study is the employment of conjunction with local
children. In most of the developed governments and institutions to The apprehension of managers
world child-labour is prohibited improve the social conditions that to insert more subjective
by law and morally condemned, are lacking due to weak measures such as ethics and
therefore, MNCs operating in infrastructure in LDCs. morality into business analysis is
LDCs would be inclined to adhere understandable. These value-
to the same conditions. However In the environmental arena, judgments are difficult to
in agrarian and rural societies, corporations face important determine, quantify and calculate.
children are often expected to strategic decisions as to whether However, the reason this matters
help work the land. This is part they should adopt the standards is because CSR is about
of local family traditions, not only of the home nation or adapt their irresponsibilities; it is about
accepted but morally encouraged standards to comply with local business having a positive impact
and economically necessary. requirements. Managers need a in the society in which it operates
Moreover, because these local understanding in order to – and in turn benefiting from that
societies often do not have the ensure a healthy long-term cycle of positivism. To do so,
infrastructure to provide adequate corporate strategy. We do not managers need to have a
24 www.triplebottomline.com.pk
meaningful insight into the value- There are common threads: through imperialism; emphasis
system of those influenced by the consumers in the US, France, must also be placed on LDCs’
corporations’ activities. Italy, Switzerland, the Philippines participation in the process.
Recognition must be given to the
demands of all those engaged in and much of South America To generate profits at the expense
the business, be they employees, agree that the most important of each other is no longer
suppliers, customers or any other thing a company must do if it acceptable, instead corporations
stakeholders. MNCs need to wants to be regarded as socially must be more responsible:
understand the ethical framework economically, socially and
responsible is to treat employees
and moral vocabulary of where environmentally. The emphasis
they operate and also be aware fairly. But the differences stand needs to move away from the
of problems that could arise due out – and they mean that traditional economic bottom-line
to these differences. multinationals cannot hope to to a modern triple bottom-line.
build public trust with a single This changing expectation of the

”
A controversial argument is made role of business signals the
global message.
by Donaldson, T. in “Values in increased significance for
Tension: Ethics Away from Home” corporations to assist countries
to support the actions of a The challenge for corporations which lack in infrastructure or
government and society which taking responsibility seriously is institutions that would protect its
may choose to act in ways which to ensure that their CSR policies people.
may at first seem unethical. He strike an appropriate balance
uses the example that in times of among these differences. 1. D’Souza provides an insightful analysis of the practice
famine it “may be wise to use Through increasingly affordable of gift-giving in Asian cultures and provides an
understanding of gift-giving for a more systematic
more fertilizer in order to improve travel and communication, we live assessment of relationship building. D’Souza, C. (2003).
“An inference of gift-giving within Asian business culture.”
crop yields, even though that in a global age with constant Asia Pacific Journal of Marketing and Logistics. Volume
means settling for relatively high exposure to contrasting ideals. 15: 27-28.

levels of thermal water pollution”. This exposure ensures that 2. Obasanjo, O. (1994). “Positive Tradition Perverted
This example should not be used having global brands in every by Corruption.” Financial Times, 14 October 1994.

to justify unethical environmental country is already contentious but 3. United Nations Research Institute for Social
behaviour but simply to illustrate to have those businesses impose Development. (1996). Transnational Corporations:
Impediments or Catalysts of Social Development?
once again the importance of their ethical standards would
understanding local context also certainly be unsustainable. In 4. De George, R. (1995). Business Ethics. Englewood
Cliffs, N.J.: Prentice-Hall Inc.
as they apply to a nation’s today’s interconnected world,
5. See Amnesty International report (2004), Clouds of
developmental stage. Astute corporations cannot conceal their Injustice: Bhopal disaster 20 years on, which looks at
the human rights impact of the leak as well as the
relativity is key. unethical practices in hidden concerns over accountability.
corners of the world. Moreover, 6. Donaldson, T. (1996). “Values in Tension:
Alaison Maitland in “A responsible the opening of global markets Ethics Away from Home”. Harvard Business
Review. Sept/Oct 1996.
balancing act” discusses a study also opens the way for a stronger
which shows that stakeholders global civil society. The stake- 7. Maitland, A. (2005). “A responsible balancing act.
Strategic Management: Global companies must be
across the globe have different holders, whose concerns dictate sensitive to different concerns of consumers worldwide
priorities which dictate their corporate values, are now both but must avoid double standards.” Financial Times,
1 June 2005.
expectations of corporate at home and in host countries.
behaviour: The business realm is no longer

about the writer


“
a morality-free zone. By engaging
in CSR practices, corporations
To Chinese consumers, are committing themselves to
Flavia Thome has
the hallmark of a socially ethical considerations spanning worked as a
responsible company is safe, borders. consultant for
Accenture and more
high-quality products. For
The application of universal recently as a
Germans, it is secure values established through Research Fellow at
employment. In South Africa, the UN-Habitat Regional office for LAC.
international consensus, such as Born in Brazil, she has a BSc in
what matters most is a company’s human rights, is among the Economics and International
contribution to social needs such biggest challenges facing the Development and an MA in Global
future of corporate responsibility. Ethics from the University of London.
as healthcare and education …
However, this must not be done
Jan / Feb 2008 25
responsible positioning

the renaissance brand


& its CSR implications
by adrian saker
for tbl

F or any company entertaining


the idea of implementing a
Corporate Social Responsibility
required to meet ever stricter
environmental standards for their
products if they are to enter
(CSR) programme in their larger consumer markets.
business, the main barriers to
adoption have always been the K&N, a pioneer in Pakistan’s
high startup costs and inadequate frozen poultry products
return on investment; but perhaps industry, has placed strict
we should reframe the question bio-security measures in all
and consider the cost of not doing its breeder farms. Its
so. environment-controlled
houses are equipped
With the rise of consumer with modern ventilation,
expectations for environmental cooling and heating
stewardship and social equipment which
responsibility, combined with the reduces the risk of
long-term worldwide shift towards disease transmission
conscious consumption, CSR has through mechanically
gone mainstream as global and physically
brands from British Petroleum to transferred disease
GE repaint themselves in a causative agents.
greener hue. They believe a That’s better for us
company can do the right thing humans, but we’ll
environmentally and still make have to explore how
money doing it. the chickens feel about
it – certainly better than
The former has even gone so far the corner store poultry-
as to change the meaning of their keeper’s cramped style,
very name to “Beyond we hope.
Petroleum,” while GE has
adopted “ecomagination” as their Across the globe, educated
primary marketing message – consumers are “greening” on their service all be equal]. The key
although one must wonder what way to becoming green. They’re word here is informed, and today
exactly is eco-friendly about leaning more and more towards the consumer is more informed
manufacturing nuclear weapons brands that are good for both their than ever.
– but never mind; where GE goes, families and the planet and this
the rest of corporate America must has led to a fundamental shift in This product information is
follow. And thereafter, the world. how they buy. There is a new manifested by a new breed of
purchasing equation: given a consumers in several ways: the
Indeed, BRIC (Brazil, Russia, choice (ceteris paribus: all other purchases they make, the brands
India and China) and other things being equal), the informed they support, the companies in
developing nations must come to consumer chooses the “ethically which they choose to invest, the
terms with the fact that, in sourced” brand. [Note: this web link they forward to friends,
perpetual endeavours to level calculation demands that price, and the opt-in advertising they
playing fields, they too will be quality, efficacy, availability, and accept.

26 www.triplebottomline.com.pk
So what might be the criteria that honest marketplace. human being or animal is harmed
a forward - leaning - or by the manufacture of its goods
Renaissance - brand must As Nike discovered, to their cost, or service.
possess to survive in the modern one ill-advised production
marketplace? decision to have Vietnamese Thus, enlightened growers might
twelve-year-olds manufacture use organic farming methods that
Perhaps we’ll call them “The Fab sneakers in sweat shops caused safeguard the health of soil and
Five”: untold harm to their brand image water resources, protect
and undid a decade of great b i o d i v e r s i t y, r e d u c e t h e i r
1. They honour the importance advertising. ecological footprint, and support
of a corporate conscience: Ethics sustainable agriculture.
The anti-corporate position taken
Milton Friedman declared, “the
by fashion brand American Auto manufacturers would build
business of business is business”.
Apparel illustrates the point: they cars that run on clean-air
Not these days; companies that
tout their products as being combustion or hybrid
ignore public sentiment make
manufactured without ‘sweat- technologies; have a high
themselves vulnerable to attack
shop’ labour. They understand percentage of recyclable parts;
and will be punished in the
that today’s sophisticated Gen- aggressively employ recycling
marketplace. Corporations can
MySpace consumer isn’t buying technologies for end-of-life
no longer make the environment
a product, they’re buying an products; and are manufactured
an externality as companies from
experience. Brands have become in an environmentally conscious
Union Carbide, Exxon, and Nike
more than just brands: they method.
can attest. Indeed, in a 2005
express us; an expression of our
Wirthlin Worldwide® survey, 82%
creativity, they’ve become a Health and beauty products would
of those questioned said that
badge of individualism; and truly be organic, free from synthetic
corporate citizenship has “at least
great brands transcend their additives, not animal-tested, bio-
some influence” on their buying
category to become something degradable with raw materials
decisions.
bigger - they become a statement such as palm oil sourced sustain-
of our values. ably and not acquired as a result
Twenty-first century companies
of felled virgin peatlands in
such as Google understand this,
And so the emphasis has moved Indonesia for instance.
as their “Letter from the Founders”
from what the product does (the Indonesian peatlands are a huge
states: “We believe strongly that
golden age of the Unique Selling source of carbon. According to
in the long term, we will be better
Proposition) to how the brand Greenpeace, an environmental
served -as shareholders and in
makes you feel. The consumer’s activist group, burning of
all other ways- by a company that
internal monologue says: “Yes, Indonesian peatlands accounts
does good things for the world
this brand understands and for 4% of total global greenhouse
even if we forgo some short-term
connects with me. I want to gas emissions. Rampant defore-
gains. This is an important aspect
support this company and station in the peatlands and
of our culture and is broadly
everything it stands for. I want it forests has made Indonesia the
shared within the company. We
to succeed and become third largest emitter of carbon in
aspire to make Google an
ubiquitous”. the world.
institution that makes the world
a better place”.
As Bob Lutz, former Head of The printed media industry would
Design at GM says, “These days use 100% post-consumer
They, more than most, know the
when everything mechanically in recycled, unbleached paper and
internet has brought new levels
a car is great, design becomes a non-toxic printing inks.
of business transparency where
huge differentiation. The interior
actions are as important as what
assumes a bigger role because The fast food industry would only
companies say in their marketing,
it's where the customer lives... If purchase meat and poultry that
and nothing kills a brand faster
you don't meet people's is antibiotic-, hormone-, and
than saying one thing in your
psychological needs you're dead”. nitrate-free; and has no artificial
advertising, and doing another.
preservatives, or ingredients.
3. They tread lightly on the planet:
2. They adhere to global labour
Environment Household products would be
standards and practices: Wages
non-toxic and environmentally
They strive to reduce their
They support Global Fair Trade safe, with consumer information
ecological footprint and deliver a
agreements and undertake a leading users to, for instance,
product or service whereby no
responsibility to support a fair and prefer vinegar over bleach for

Jan / Feb 2008 27


responsible positioning

most purposes. 5. They espouse sustainability for wrong side of history and will be
future generations: The Future penalized by the markets,
In Pakistan, Engro Chemical has markets that are increasingly
They are moving toward
successfully reduced the informed and empowered.
sustainability in their business
emission of green house gases
models and preserving our
(CO and CO2) on its per ton urea Nestle Philippines, for example,
planet’s non-renewable resources
production from 850 kg CO2 per initiated its ‘Greening the Supply
for those yet to be born.
ton of urea in 2006. The reduction Chain’. The program, running
is perhaps directly linked to its over the last couple of years, set
Big business is getting the
energy conservation profile. As out from board level to encourage
message: Honda’s new 213,000-
cited in Engro’s 2005 business partners to adopt
square-foot "Green Facility" car
Sustainability Report: over fifteen environmental management. The
factory in Gresham, Oregon is
years, the company was able to company has now recruited 55
the first Leadership in Energy and
reduce its energy consumption more of its 300 or so suppliers to
Environmental Design (LEED)
by over 31 percent. join the scheme. The programme
Gold certified mixed-use industrial
aims to encourage sound
building. LEED is a Green
4. They run counter to the global environmental practices, as well
Building Rating System™. The
consolidation trend, offering more: as realising economic benefits.
building’s rainwater collection
Choice
system gathers accumulated
As Machiavelli, a figure from
This is not anti-globalisation, it is rainwater on the roof and funnels
Pakistan’s own Taxila-sprung
anti-consolidation; anything that it into a 90,000-gallon storage
‘Ardh Shastrae’, said, “He is
limits consumer choice. Many of tank and is used to irrigate
prosperous who adapts his mode
us are unhappy living in a Coke- landscaping and supply water for
of proceedings to the qualities of
or-Pepsi world and believe we toilets; their conference room wall
the times”.
deserve a wider choice of healthy coverings are made from recycled
products. telephone books, and the
But whose times? It is up to us
tabletops are made from
to define our times. 150 years
In the first decade of the American compressed sunflower seeds.
ago American Calvinists said,
auto industry, there were 346 And the sweetest irony of all? The
“Business is about making
different car companies. Buick, hallway flooring is made from
money, and life is about doing
Cadillac and Chevrolet were all recycled car tires.
good, and the two are not
independent before they merged
mutually exclusive”.
to form General Motors. And now Companies such as Honda are
there are two. working towards a healthier future
and a less polluted world. They It is key for tbl readership to
In Pakistan, the emergence of are many years ahead of analyse and apply the business
MakkahColas, AmratColas and environmental legislation not only values both in our cultural and
the like are a brand example of because they know it’s good for religious heritage. Indeed, there
consumer empowerment through their corporate image, but is nothing new except that which
increased choice. Better still, because it’s a viable business has been forgotten.
perhaps are the examples of model and they know compliance
Pakola-ethnically flavoured milk- costs ten years down the road
based drinks. will be prohibitive. They are
choosing to build a meaningful
This innovation-based culture company that improves people’s
however is, knowingly or lives.
otherwise, often stifled by larger
MNCs, through their bulky And so, a headwind is turning into
leverage controlling upstream and a tailwind: green is moving from
downstream supply chains.
MakkahCola for instance had to
niche to mainstream; the word no
longer needs to be phrased in about the writer
shut down for various related quotation marks.
Adrian Saker is one of New York’s
reasons. Lack of consumer Environmentalism is an idea
leading art directors. With over fifteen
awareness of such issues often whose time has arrived:
year’s experience on a who’s who of
leads to un-empowered companies that choose to blue-chip brands, he's worked in every
purchasing decisions where embrace it will leverage the power category and business sector. Adrian
consumers are not fully aware of of consumer choice and build holds a BA in Art & Design from
the consequences of their corporations with a conscience. England’s Brighton University.
choices. Those that shun it are truly on the

28 www.triplebottomline.com.pk
breather

“responsibility
Done with my corporate social

”
for the entire year.

“CSRAndAwards
the first prize in our Annual
goes to Banana
Corporation, who coincidentally happens

”
to be our lead sponsor.

“ Gentlemen, this company just cannot ignore


CSR anymore. As CEO, I am pleased to announce
that the management is freezing all salary raises
this year. This will give us more cash flow to put
into our CSR programme, starting off with a visit
by your CEO to some countries this summer to

”
study the CSR models there.

Jan / Feb 2008 29


mainstreaming csr

essential csr
by glenn schloss
for tbl

A long-running debate about


the purpose of business has
exposed some of the differences
between Western and Asian
approaches to corporations. While
the Western model has long
focused on creating shareholder
value, companies and
governments in South Asia,
including Pakistan, have tended
to agree - but also emphasise
their contributions to development
of societies, economies and
nations.

Somewhere between these


distinct approaches of what the
late economist Milton Friedman
described as “the business of
business is business” and the
developmental mode of capitalism
lies a unique opportunity for South
Asian and Pakistani companies.

This approach will guide the most


successful Asian companies in assertion that simply by engaging countries has led to adverse
embracing corporate social in business they are helping the environmental impacts and
responsibility (CSR). community. stretched socio-economic
disparities.
Assessing True Economic Companies have been engaging
‘Cost’ – and Benefit in business for hundreds of years Management should be acutely
while the past 60 years have seen aware of the impact – both
It is that the simple business of a massive increase in positive and negative – its
doing business is ultimately good competitiveness and emergence activities will have. Companies
for society because of the of a global economy. As well as must be prepared to abandon
economic impact its products and creating massive amounts of activities when the damage,
generated revenue have on personal wealth, and generating hence ‘cost’, would be too great,
individuals and groups as well as economic prosperity, companies modify when the risks outweigh
creating wealth which rolls out in have also wreaked an untold the benefits for the community
waves across the community. amount of damage on and consult with external
Taken to its logical conclusion, communities, the environment, stakeholders when undertaking
this approach to CSR is highly and political systems. India and any project with the potential to
attractive to companies for one Pakistan have first-hand impact other parties.
simple reason: it is good for experience of the impact of rapid
business. industrialisation with little thought Asia Mainstreams CSR
for the social and environmental
However, in order to embrace true costs. The rapid pace of The notion of Corporate Social
CSR, there are important steps industrialisation exacerbated by Responsibility has entered the
companies need to take that a lack of proper infrastructural or mainstream in industrialised
require them to go far beyond the regulatory systems in these countries. According to a KPMG

30 www.triplebottomline.com.pk
survey, in 2005, 52% of the professional managers running Adopting practices from the West
world’s 250 biggest companies corporations in the world’s fastest- where a free media, a multitude
issued separate CSR reports. As growing economic region have of NGOs including consumer
CSR embeds itself in the traditionally preferred to focus on advocacy groups, trade unions
operations of leading companies the business of running a and crusading politicians have
around the world, an increasing business. forced companies to hone their
number of companies in Asia are skills in dealing with interests they
embracing the need to ensure Romancing the Stakeholders represent, MNCs have been
activities are ethically sound – fostering corporate Asia’s
and beyond. They are also This new trend will require engagement with stakeholders.
seeking to engineer projects businesses in Asia to reorient their So proficient have some large
which provide win-win situations adversarial views of stakeholders Western multinationals become
for companies and stakeholders. such as media and NGOs to an at managing these outsiders in
Global social and environmental approach based on partnership their home markets that they now
concerns such as climate change, and relationship-building. Those base entire corporate affairs
poverty alleviation and labour that succeed in making the shift strategies around stakeholder
rights are increasingly driving can look forward to a newfound groups. Similar strategies,
corporate strategies of firms influence and ability to set the adapted to local conditions, are
operating in Asia. agenda with important partners. being rolled out in Asia.
Those that continue with the
The reason is simple: forces of patterns of the past risk being Key to effective CSR and
globalisation, political locked into a pattern of conflict management of stakeholder
liberalisation, rise of digital and and waning power to affect the relations is identifying the various
aggressive media as well as the wider issues confronting their external (and internal) groups that
emergence of NGOs in Asia are businesses. This stakeholder- have the power to affect not only
forcing companies to become oriented approach to CSR a company’s business but also
socially responsible. Those that provides dialogue and the basis its operating environment and
fail to do so will be punished by for a genuine partnership. regulatory framework. Once those
communities, purchasers, media, parties have been identified, they
Media have become more need to be prioritised and their
governments and, ultimately,
aggressive in reporting the interrelationships explored to
markets.
performance (and problems) of better understand how, those who
companies. At the same time, appear to be disparate groups,
At a fundamental level, CSR is NGOs are operating in freer actually interact and influence
all about stakeholder relations; environments, particularly when each other behind the scenes in
managing an effective monitoring business. Even in society.
communication and outreach those places where political
programme; and providing devolution does not fit the CSR is essentially a longer
feedback that truly impacts We s t e r n - t o u t e d m o d e l o f acronym for business acumen.
operations in the most positive democracy, there is a willingness Any business which ignores the
way. The areas which comprise to allow business to be subject to community and groups which
the most commonly discussed greater levels of scrutiny, have the most power to boost or
components – environment, especially when management is wreck their prospects is ignoring
labour, social impact – should all found to have harmed one of its key opportunities and
be addressed by genuine and consumers, engaged in corrupt responsibilities. And the stakes
professionally-operated practices or excessively harmed have just become much higher in
communications programs. the environment. This trend has Asia.
prompted some analysts to
The drive across Asia towards speculate that authorities are
freer markets and more prepared to tolerate such scrutiny
responsive forms of government not only as part of the rise of
has been accompanied by an
increasingly aggressive media
and the proliferation of non-
market forces but to relieve
various pent-up frustrations within about the writer
the system through the “letting off
governmental organisations Glenn Schloss is Hill &
of steam” through media and
(NGOs) which are placing NGOs. Knowlton’s Regional
corporations under the spotlight. Director for Corporate
Such scrutiny is not welcomed by Multinational corporations have Communications, Asia
most companies operating in played a key role in localising this Pacific.
Asia. Entrepreneurs and global trend on the continent.

Jan / Feb 2008 31


social partnership

Hisaar Foundation
a foundation for water, food and livelihood security
on
his

ar
ti

a
s

fo u nd

by zehra qadir
for tbl

H
ave you noticed that raising awareness about such sectors of the society about
Pakistan has more extreme issues. conservation, management and
weather events than it did some recycling of water, better
years ago? That droughts and Hisaar Foundation, a non-profit agricultural practices and less
floods have become more organisation, originated in wasteful consumption of food and
frequent? Did you know that per response to the severe drought water. Hisaar Foundation is also
capita availability of water in that gripped parts of Pakistan in working on solutions within the
Pakistan has gone down so 1999 and 2000. Simi Kamal geographical, environmental and
sharply, that Pakistan is now gathered a small group of citizens social framework of Pakistan that
classified as a water scarce in Karachi and launched the meet the needs of people while
country? Did you know that the Pakistan Drought Appeal. This preventing long-term depletion of
poor in the city of Karachi pay 12 campaign raised Rupees one water and food resources.
times more for water than those crore worth of food, water,
who get water supplied through medicines and other essentials Within this framework the
pipes, and that less than 2% of in cash and kind within three foundation runs the following
the sewerage and effluents days, and had collected a month’s initiatives and programmes, with
generated in Pakistan are actually supply of food within 48 hours of a special focus on women and
treated before being dumped into its launch. During the early children:
rivers, canals, lakes and the sea? p h a s e s o f i ts w o r k , t h e
Is there anyone out there who Foundation engaged in two other Women and Water Network
cares? major fundraising campaigns and Women Support Programme
hands-on relief and rehabilitation in earthquake affected areas
Hisaar Foundation – a programmes (Citizen’s Appeal for of Azad Kashmir
Foundation for Water, Food and Afghan Refugees and Appeal for
Livelihood Security, does care Earthquake Relief and Karachi Water Partnership
and has been working on these Rehabilitation), and continues to
issues since 2000. “We believe raise funds for causes related to BioSand Filter Programme
that the rational management and helping people affected by climate (for low-cost safe drinking
conservation of water, long-term change, earthquakes, water- water at point of
food security and lack of related calamities such as consumption)
opportunity for all Pakistanis, 80% droughts, food shortages and
of whom rely on agricultural other situations related to survival Water Systems in drought
production to earn their and livelihood. prone areas of Thar
livelihoods, are Pakistan’s biggest
problems today. However there The Foundation has now Livelihood Rehabilitation,
is little critical thinking or forward developed into a unique institution Nutrition and Health Support
planning to address these issues that provides a platform for Programme in Badin
by the government, civil society bringing together issues of water,
organisations and the media,” food and livelihood and seeks Academic and Media
says Simi Kamal, Founder and solutions pertinent to dealing with Engagement, Orientation and
Chairperson of Hisaar this water-food-livelihood nexus Education Programme
Foundation. Development and in an integrated manner.
success of water conservation The Foundation is also a
programmes requires the Its vision is a Pakistan where member of several international
involvement of all stakeholders, water is judiciously used, food is water-related and civil society
including policy-makers, service- sufficiently produced, and people organisations and collaborates
providers, consumers, media, are able to earn livelihoods with proactively with them for the
community leaders and so on. dignity. Its organisational goals promotion of Integrated Water
The media has a crucial role to include advocacy and Resources Management, water
play in educating the public and awareness-raising among all conservation and environmental

32 www.triplebottomline.com.pk
issues. These include the Global KARACHI WATER PARTNERSHIP MODEL
Water Partnership, CIVICUS, Key Issues & Challenges
Pakistan Water Partnership and Declining Water Quality & Supply

Pani Pakistan. Strategy


Absence of Focused Strategy for Wastewater
Poor Planning in Water Conservation Measurements
Results
Establishment of
independent KWP Sufficient safe
Hisaar Foundation is not a Government &
stakeholders
KWP Programme
Short & Long-Term
drinking water for all

foreign-donor funded service- working together Water Fact Institutional Development & Partnership Building
Solutions for Integrated Water Resources Management
Cleaner & greener
city

delivery NGO that does typical


Focus on behaviour
change Integrated water
KWP Approaching Partners resources
project funding for aid money. Target advocacy
programme for
citizens &
Stakeholders
management

Hisaar Foundation has a unique stakeholders


NGOs, CBOs,
Industry,
Citizen &
stakeholder

development model and it raises Sharing


experiences,
information &
Academia
Institutions,
Public &
KWP Government ownership
Alternate solutions
the bulk of its support from technologies
Providing
Experts for industry

individuals and institutions in international &


regional linkages
Citizens of Karachi Information-based
decision-making
Pakistan. “We have raised the International Linkages
rupee equivalent of approximately GWP AWP Pani Pakistan

USD one million in cash and kind


since 2000, the bulk of which has “Our view is that water is every- closely with the Karachi Water
been contributed by the public in one’s business, and each and Sewerage Board and is in
Karachi. This city has a heart of individual and group has a the process of initiating work with
gold, and we will continue to raise responsibility in conserving and local government institutions.
support for our work from both managing water, sewerage and Current projects of KWP include
individual and corporate citizens solid wastes, to make this city a school advocacy programme
of Karachi. Increasingly we look livable, and leave a legacy for (including children becoming
to our work being supported our children that is not an “water detectives”); an experi-
through corporate social environmental disaster,” says mental BioSand filter programme;
responsibility,” says Simi Kamal. Simi Kamal. a public awareness campaign
through print, film and broadcast
Hisaar Foundation is governed This is the first initiative of its kind, media to inform all stakeholders
by its members and an elected where improving the environment of the seriousness of the water
Board of Governors led by a of a city of 16 million people is crisis; developing and promoting
chairperson, all of whom give time being attempted to the building innovative and successful
to the foundation’s work on a of a partnership that brings solutions for a coastal city;
voluntary basis. Governors together government institutions, defining the role of different
provide immense support and industries, corporate sector, groups of citizens; providing
each programme has a separate municipal authorities, businesses, citizen-based guidance; and an
programme committee headed civil society organisations and annual Water Forum.
by one of the governors. individual citizens, all on the same
Management decisions are taken platform of action. KWP serves Becoming a partner of the
by the chief executive who is also as a catalyst for all these groups citywide multi-stakeholder KWP
currently working on a voluntary to come together and ensure a Forum has numerous benefits for
basis. This voluntary spirit and healthy, clean and green Karachi companies and businesses. This
concrete contributions from in the long-term. forum can be used as a means
members and governors is to collectively disseminate
another unique feature of Hisaar To-date, KWP has over 200 knowledge and research related
Foundation. Currently, the partners, each of whom has made to solutions for water, sanitation
Foundation is housed within the a contribution in cash, kind or and solid waste issues. Guidance
business offices of two council time for promoting and actually and media support to promote
members, while legal, media, carrying out the work of KWP. water conservation and better
management and fundraising The initiatives and programmes water management can be
support is provided by the offices run by the management obtained. Experts are also
of four other council members committee and subcommittee available to give talks, carry out
and governors, all free of charge. members of KWP demonstrate water audits and give advice.
its commitment to social There is an ongoing dialogue with
Hisaar Foundation’s biggest and responsibility. They have water the city government and the
most challenging initiative to date saving and recycling systems and private sector. The KWP Forum
is the Karachi Water Partnership processes in their homes and provides an opportunity to a
(KWP). The project aims to offices, and promote these diverse group of stakeholders to
support the development of an methods among other companies share their valuable experiences.
environment friendly Karachi with and institutions. KWP circulates
focus on safe water, conservation guidelines in English and Urdu For more information on Hisaar
and management of sewage, for conserving water in homes, Foundation please see
industrial and solid waste. KWP offices and schools. Guidelines www.hisaar.org
was launched on 26th April, 2007, for industries and public spaces
with an open call for partnership. are being developed. KWP works

Jan / Feb 2008 33


book in focus

corporate social responsibility


doing the most good for your company and your cause
by philip kotler & nancy lee
by dilawar hussain
for tbl

A llrations
across the world corpo-
are learning and
business and marketing
and Nancy Lee,
perhaps the hard way - that President of Social
success and failure is measured Marketing Services
not just by how much money they Inc., put their heads
make in terms of profits, but also together to come up
by how much effort they make to with 25 best
stand up to their social respon- practices, assembled
sibility as a "good corporate to guide decision
citizen". Corporate Social making in the area
Responsibility is the buzz word of corporate social
in today's corporate world. But r e s p o n s i b i l i t y.
whatever is CSR? Given the
methodical expla-
The authors define the term as: nations on how to
"A commitment to improve apply theories to
community well-being through practice, it might
discretionary business practices just about be
and contributions of corporate right for the
resources". The earliest impre- authors to
ssions that the book makes on conclude: "It is
the mind of the reader is that in the end, intended to help
"Corporate Social Responsibility" maximize the return on from twenty-five
is not just about some kind of discretionary corporate business leaders of the business
vague theories but supports all investments, resulting in efforts world's most admired companies.
that it preaches with practical that do the most social, One corporate executive
applications. Labelling the book environmental and economic expresses his appreciation of the
as "a Bible for today's corporate good". work by stating: "Corporate Social
citizen"- as the publisher does Responsibility makes a
on the flap of the book- may be The authors hope that by applying compelling case that corporate
stretching it a bit too far, but the ideas presented in the book, community engagement and
"Corporate Social Responsibility", business leaders would learn how maximizing profit are not mutually
does provide thoughtful answers to align their business goals with exclusive, but rather mutually
to a number of vital questions on cultural and social ones; choose reinforcing".
how a corporation could do most social issues and charities to
good for itself and its cause. support; gain employee support; The thrust of the opening pages
implement successful initiatives identify six major initiatives under
Authors Philip Kotler, one of the and evaluate their efforts. The which most social responsibility-
world's foremost voices on book includes first-person stories related activities fall. These

34 www.triplebottomline.com.pk
include cause promotions; cause- Corporation advertisement in late
related marketing; corporate 1980's which read: "Our shoes
social marketing; corporate aren't the only thing we
philanthropy; community volun- encourage you to wear". And

“
teering and socially responsible those words are accompanied by
business practices. a graphic of a condom! The book
proves to be a professional and For many years,
These six corporate initiatives are practical work of people who community development
individually and elaborately understand the subject and know
discussed in the later chapters, how to convey the ideas. In goals were philanthropic
all of which are condensed in the writing the book, the authors have
activities that were seen
overwhelming idea of the book, in mind corporations and their
namely: "How to do the most communication agencies and as separate from business
good for one's company as well foundations and public sector
as for a cause". The authors also agencies seeking corporate
objectives, not
caution against "potential support and partners for social fundamental to them;
concerns", which in no way initiatives. It is intended to guide
means to discourage the cause, decision making for corporate doing well and doing good
but to identify and reflect upon managers and executives; were seen as separate
that side as well. besieged on a daily basis with
requests and proposals for pursuits. But I think that is
The book does not leave the support of social causes. changing. What many of
readers in the dark but also leads
them to "key to success" by citing For corporate executives who the organisations that are
examples of how corporate giants understandably are busy-bees represented here today
such as Microsoft; IBM; Body and may not be able to turn over
Shop; Ford Motor Company; each of the 307 pages to read are learning is that
H e w l e t t - P a c k a r d , the book, the authors have
cutting-edge innovations
Shell Australia, Cisco, Coca-Cola, thoughtfully provided a couple of
Motorola and scores of others paragraphs of "summary" at the competitive advantage
were able to ride out the conclusion of each chapter. The
challenges. final chapter of the book lists ten
can result from weaving
recommendations under the social and environmental
Few of the top names on Fortune head: "A Marketing Approach to
500 may have been missed, Winning Corporate Funding and considerations into
where examples are concerned, Support for Social Initiatives". business strategy from the
which shows the amount of These provide valuable guidance
research that the authors must to corporate executives of all beginning. And in that
have done. In a book, which ranks and file. process, we can help
essentially must be dry for a
reader, there are spots of good develop the next
humour. In regard to one of the
generation of ideas and
six initiatives, the authors remind
the reader that historically,
about the writer markets and

”
companies' educating campaigns
have reflected the founder's social
employees.
Dilawar Hussain is a senior reporter
working for Pakistan's largest circulated
consciousness and have been English daily, The "Dawn". He has 23
considered controversial by years of experience of writing for local Carly Fiorina
and foreign publications. His scope of
some, funny by others and interests include the stock markets,
corporate sector and country economics.
inspiring to many. Holder of Masters degree in Journalism,
English and Accountancy from reputed Excerpt from Chapter 1.
institutions in Karachi.
The book mentions a Cole
Jan / Feb 2008 35
evolution of csr

the rise and rise of csr


by michael hopkins

“
We have seen both Microsoft and is meant by CSR has led to
then Google innovate at an some form of convergence –
An economist amazing pace. The UN has the social responsible
offered us the Global Compact, treatment of stakeholders is
is an expert who will the MDGs and ILO core labour accepted, environmental
standards. Not to be sniffed at, concerns are still very
know tomorrow why but all proceeding at a snail’s
pace.
prominent but come under
the heading of corporate
sustainability. Yet issues such
the things he Fifteen Key Items as corporate governance
have remained firmly in the
There are at least 15 key items
predicted yesterday on the CSR agenda that we have
hard nosed business camp
and are not often treated
seen develop over the past ten along with CSR concerns.
didn't happen years:

”
1. C o r p o r a t e s c a n d a l s 3. The stages of CSR
today. Certainly CSR was not a new
issue in the mid 1990s, for
(We continue to use the term
CSR since leaving out the
Evan Esar concern over social issues in word social de-emphasises
business had gone back as social issues). In the past ten
far as Adam Smith and even years we seem to have

W hat has happened to CSR before that with the South followed the classical route
since I started working on Sea Bubble. However, the of the introduction of a new
the subject over ten years ago? mid 1990s saw an upsurge technology – innovation,
in interest as the public sector diffusion (through writings,
My involvement with CSR was involvement in key industries discussions, seminars etc.)
stimulated by the feeling that the fell away, particularly after the and implementation which is
public agencies with which we collapse of the Soviet Union, just about starting particularly
had worked – ILO, UNDP, World and as a crop of corporate in Europe. The USA is behind
Bank etc. – had done many scandals hit the headlines – the European trend as is
wonderful things in the area of the Ken Saro Wiwa affair that Japan. There is much interest
development (and better severely affected Shell’s in CSR in the developing
publicised, some well known international image was world, especially India and
failures) but their efforts have not perhaps the watershed. South Africa even though few
been more than a drop in the major corporations can be
ocean. After leaving a meeting at 2. Terminology still found with their headquarters
UN H.Q. in New York, I felt that unfocussed in the developing world.
the UN was getting nowhere fast We had hoped that there
and that, as the new millennium would be a convergence on 4. CSR reports
was five years away, it was clear terminology so that we would, CR or sustainability reports
that the next millennium would at least, know what we were are now produced regularly
be handed to the private sector. talking about. However with by the major corporations in
Not without challenge nor doubt, the brief dominance of the Europe and the USA, and
but the private sector has, and term CSR in the early 2000’s, there are signs that
continues to, show a robustness the terms corporate companies in middle income
and vibrancy that, unfortunately, responsibility (CR) or developing countries are
our public sector agencies both corporate sustainability (CS) producing CSR reports.
nationally and internationally have have tended to dominate in There has also been a move
failed to show. corporate circles. And what away from printed material

36 www.triplebottomline.com.pk
into web-based reports. mean just ticking a set of lot of patience to work with.
boxes – the approach is more
5. There are now many complicated and cannot be 11. N o n - g o v e r n m e n t a l
newsletters and news- covered by legislation. organisations have grown
groups covering CSR from in number by leaps and
the very popular Yahoo group 8. The Global Reporting bounds from Tomorrow’s
CSR-chicks that fostered Initiative (GRI) that emerged Company and SustainAbility
CSR-blokes and regional from the environmental in the UK to the Center for
newsgroups, to Ethical movement CERES is still Social Markets in India, Ethos
markets, Csrwire, Ethike, stronger on environmental in Brazil, Philippine for Social
Ethical corporation, Ethical concerns than social and Progress in Manila, Triple
performance, and a whole economic but has had a major Bottom Line in Holland,
host of regional newsletters impact on the social reporting Business Ethics in USA etc.
such as CSR Asia, Philippine of companies who try and
for Social Progress etc. follow GRI guidelines both for 12. Third world development
Although there is now too reporting and for the pro- More and more companies
much information to read, if duction of very useful indi- are adding third world
one has the time, it is cators. Certainly measure- development to their CSR
gratifying how much ‘good’ ment has improved enor- activities and, Type III
stuff there is about on mously over ten years when, development activities are
companies and their in 1995, I had to scrape to rapidly increasing. There are
performance, as well as the find social indicators on three main types of develop-
main actors in the field. companies. ment activities – Type 1:
Development philanthropy,
6. Few new laws have entered 9. Government has got into the Type 2: Assisting developing
the arena directly related to CSR act, particularly the UK countries purely through
CSR which was one of the which has a lively website housing local operations there
concerns of market capitalists promoting CSR and also and Type 3: Development
such as ‘The Economist’ and appointed a succession of a s s i s ta n c e a s pa r t o f
some ‘Financial Times’ CSR ministers who, reputation building which, in
correspondents. However, unfortunately, don’t seem to turn, is part of CSR.
closely related was the do very much. Even the USA
Sarbanes-Oxley law covering has haltingly produced a 13. Finance centre scepticism
corporate governance which report on CSR and what As CSR has grown in
has had the unfortunate Government can contribute prominence, at least in its
effects of raising the costs of after ignoring the field for various manifestations, the
reporting and reducing the many years. right wing so-called ‘think
number of new flotations on tanks’ have been arguing that
the New York stock market in 10. International governmental profit maximisation should be
favour of slightly more liberal organisations – European the main aim of business
regimes such as London. Union, World Bank, UNDP, while remaining within (more
IDB – being the most or less) the confines of law.
7. Accounting standards prominent. My previous Simply put, they argue that
There has been a growth in employer, ILO, has gained CSR simply adds costs with
‘voluntary’ accounting prominence through the no immediate benefit to
standards for CSR – application and citation of its profits. Yet, the business case
AccountAbility, for instance, core labour standards but has for increased profits through
with its AA1000 and then Alice no policy as such on CSR increased reputation, lower
Tepper Marlin’s SA8000, due to in-house in-fighting risk that come hand in hand
standards. Both groups, between workers, govern- with CSR have been ignored
incidentally, steadfastly refuse ment and employer organi- by the right. Despite the
to use the term CSR. In the sations (most notably the growing evidence that ‘ethical
pipeline is also a standard appalling IOE, International corporations’ tend to do better
(ISO 26000) on Corporate Organisation of Emplo-yers). on average in terms of share
Responsibility coming from The EU, in particular, has price, Wall street turks and
the International Standards done good work in funding their mirror image in the major
Organisation (ISO) based in CSR initiatives all over financial centres of London,
Geneva. Corporations, Europe although my own Frankfurt, and Tokyo still claim
however, have noticed that personal experience shows not to understand what CSR
observing CSR does not that its bureaucracy needs a is all about as they punch

Jan / Feb 2008 37


evolution of csr

another button flashing CSR exit strategy simply Julius Nyrere, Nye Bevan,
money around the world. because business will only Harold Wilson and even Bill
survive if they can show, and Clinton are just about all, and
14. Academic courses be evaluated to show, a clear even those were not perfect)
Few, if any Universities had social responsibility in their – then, like it or not,
courses on CSR although continual treatment with their corporations will become
some had started course on stakeholders. An exit strategy even more powerful and
business ethics. Today, hardly will not be required simply influential. But will they be
an MBA is taught without at because social responsibility setting a coherent social
least some discussion of CS will just be part and parcel of agenda? Some will, some
or CSR or CR university normal business practice. won’t but their agendas will
courses. be examined in ways hardly
Major inroads in developing thought of so far today.
15. S o c i a l l y R e s p o n s i b l e countries
Investment (SRI) has been CSR will continue to make So what is likely to happen next?
the fastest growing financial inroads into developing Hard economics is losing way to
instrument in the USA and countries, particularly through more softer versions. Culture and
Europe financial centres over the main suppliers to the large ethnicity have dominated recent
the past ten years. The corporations in the developed world events and this trend is
strange contradiction, where world, but also because likely to continue. Focusing on
the subject is ignored in the developing country people will purely economic growth for
City but important to investors not suffer corporations that countries or profits for companies
will, undoubtedly, change in have no connection with local will, of course, be uppermost in
the coming years. As better cultures and aspirations. our leader’s minds. But the softer
educated graduates enter under-currents of change, such
investment houses, and as SMEs will have CSR as CSR, will require new, inspired
the investment record of SRI’s CSR will extend to SMEs leadership and, as Jem Bendell
is better known, the right wing through rapid assessment puts it [2]:
think tanks and their and implementation tools.
aficionados in the City and “Understanding power and its
Wall Street will soon be Companies cannot ignore responsible use is probably the
barking up the same tree. global concerns bedrock question underlying
Companies will grapple with much work on corporate
the big issues simply because citizenship today.”
What is the Future for CSR? they see failure as bad for
business. Under-develop- And the UN? Until there is a
And what will happen with CSR ment, labour exploitation, change at the White House, the
in the future, at least the next curbs on migration, global UN Glass House will remain
decade? warming, trade barriers, under-funded and not able to
global terrorism are all major deliver its many excellent
Will become embedded challenges for Governments development initiatives.
There is no doubt that CSR and corporations. We already Corporations…please note!
will become embedded in a see signs of these increasing
company’s culture and concerns for corporations at
organisational profile to such the annual World Economic 1. The Third Sector and its relation to the private and
an extent that it will not be Forum conferences in Davos. public sectors was subject to lively debate at a
noticed, explicitly, anymore. conference in Siena, Italy in February where the author
There is also not much doubt UN and third sector gave a keynote speech. For more information contact
that the phrase CSR will cooperation us on enquiries@mhcinternational.com
disappear but the sentiments As companies cannot easily 2. Jem Bendell (2005) ‘Lifeworth annual review of
behind it will be in place. The shape the macro agenda corporate responsibility’, available from www.lifeworth.net
area of business and society there will be increased
will continue to be one of cooperation between
great debate, and the corporations, the UN and its
corporation will certainly agencies as well as NGOs,
change its form. I would the so-called ‘third sector’ [1].
hazard a guess that the
private sector will still flourish Political leadership will
as far as the next 50 years
ahead but its power will be
improve
If the leadership of our nations
about the writer
very much controlled as our continues to be poor – there
own personal liberties also, Dr. Michael Hopkins is Managing
have been very few decent Director of MHC International Ltd
unfortunately, become, more leaders in the last 50 years
controlled. (MHCi) and is an economist specialising
that have combined decency in socio-economic issues. He has broad
with social justice (Nelson international business experience and
No need for exit strategy Mandela, Jimmy Carter,
There will be no need for a almost two decades of action in CSR.

www.triplebottomline.com.pk 38
the eight fad tests

corporate social responsibility:

serious or just a trendy fad?


by ivor hopkins

A re– do
you a Sceptic or a Convert
you see CSR as an
proposing practices that
adherents say will apply to
CSR has strong historical roots,
whether you look as far back as
expensive waste of time, a trendy almost any industry, Greek Ethics or Victorian Corporate
option or a serious business activity? organisation or culture…” Philanthropy, so the concept is hardly
novel. CSR does ask awkward
The eight fad tests: That CSR can be addressed by any questions and argues for change so
size of company from trans-nationals if the will is there at CEO level then
1. Simple: “Fad concepts are to SMEs is true. Yet the needs of real strategic and sustainable change
easy to understand and these companies, as well as the can take place.
communicate and tend to be scope for CSR, differ so their CSR
framed with labels, buzz engagement has to be tailored 8. Legitimized by Gurus and
words, lists and acronyms.” accordingly. Disciples: “Many fads gain
credibility by the status and
CSR has a fountain of labels and 5. Easy to Cut-and-Paste: prestige of their proponents
acronyms and this is certainly one “Because fad management or followers, rather than
of the major downsides in making ideas must be simple and easy through empirical evidence.”
CSR a serious management tool. to apply, they’re amenable to
During a presentation on CSR to a partial implementation.” The fact that governments,
school, I asked the students to define universities, businesses, NGOs, and
CSR. Two days of discussion on The beauty of CSR is that a company other associations are running with
CSR had opened up more issues can test the sustainable waters and promoting CSR is a sure sign
than the students could easily before going for a paddle and way that there is more substance here
summarise. Hence CSR is certainly before considering total immersion than snake oil. Innumerable social
not easy to understand! – you can start with partial reports show faith and speak
implementation. But, CSR is a volumes. There are books by an
2. Prescriptive: “Though a process: two things will ensure that increasing number of CSR
fad’s fundamental ideas might the CSR activity is not tossed aside specialists. CSR is also an issue that
be sound, the need to be like a fad: one, the benefits of CSR is increasingly being given an airing
simple but prescriptive makes will kick in (for example, improved in the media.
their action points easy to recruitment) and second, increased
misinterpret or inappro- stakeholder engagement will fuel the In their review of fads and
priately apply.” engine of CSR involvement. management classics, Miller and
Hartwick comment that “if a
One thing about CSR is that, 6. In tune with the Zeitgeist: management approach shares most
although the prescription is a large “Because fads focus on the of the fad features described here,
one, it does not have to be taken all concerns of the moment, they beware. If it looks too simple to work,
at once and the instructions for its tend to apply to a few specific it probably is.” And if you are still
ingestion are usually very clear. But, issues rather than addressing not convinced by this article that
there is a view about CSR that it the fundamental weakness or CSR is not a fad but a real
cannot, and should not be, over- soundness of overall business management tool, then you can base
prescriptive although we have practice.” your continuing research on Miller
argued before that some legislation and Hartwick’s closing paragraph:
is necessary to level the playing field. CSR focuses on modern business
weaknesses be they in human Does the approach have a track
3. Falsely encouraging: “…all resource management, corporate record for performance and
kinds of fads are better at governance or in environmental measurable outcomes in similar
raising hopes than delivering policy. No one would disagree that companies facing similar challenges?
results…” each one of these is a key issue: Does it address problems or
CSR does not duck them. Further, opportunities that are high priorities
ÊCSR highlights and gets to grips a thorough dialogue with a firm’s for our company? Are the changes
with major corporate issues. A stakeholders will draw out all it would require within our company’s
company focussing on CSR is problems and concerns not simply capabilities and resources? Yes
usually doing so not only because it the topical or petty ones. answers to these questions suggest
is convinced of the tenet “Doing well an approach likely to pay off and
by doing good” but also because the 7. Novel, not radical: “..their endure.
management is aware of risks freshness is often superficial,
highlighted by its stakeholders. and, as such, fads don’t
unduly challenge basic about the writer
4. One-Size-Fits-All: “Fads managerial values.” Ivor Hopkins is Director and Partner of MHC
claim universal relevance, International Ltd (MCHi), and is a marketing
specialist for CSR issues.

Jan / Feb 2008 39


musings

do you
speak my language?
by praetor
for tbl

T here was a time when some


corporate executives in any
organisation would manage to
– let us call him John – and
Aesop, a fresh business graduate
who has just joined the company.
Aesop: You did.
John: Okay. Forget that A-SAP.
get by in their jobs year after year The company has assigned Aesop: It’s Aesop, like in Aesop’s
and get promotions too, all with Aesop to work under John and Fables and not A-Sap
very little effort or real work being John wants Aesop to know who
done. They had perfected an art the boss is from the very start. John: What? You are really not
called LBDN: Look Busy Do So he goes into Corptalk to with it, are you? Will I have to go
Nothing. Cluttered desks, sleeves impress the pants off him. Now the full nine yards?
rolled up and tie loosened, long something that may have worked Aesop: I am sorry, are you going
telephonic discussions well with a client just doesn’t cut somewhere?
presumably with clients and so ice with Aesop, as he is not at all
on. A behaviour repertoire carried familiar with Corptalk. And as the John: For crying out loud. I think
out with precision and great conversation progresses he gets we need to take some baby steps
conviction worked wonders and increasingly confused and yes, here.
while the nerds in the office, poor scared! So here is how the
souls, slogged silently to ensure conversation goes: Aesop: John I am feeling really
year-end profitability, the yuppie lost here. Where did the baby
executives stole the limelight and John (after explaining a point come in and why is the baby
caught the management’s eye. to Aesop in doublespeak): I crying out loud?
hope you are getting the joke.
Not so any more though. John: Because, you moron, you
Structuring of executive functions Aesop: I am not sure. I didn’t are just not synergizing.
and HR practices has meant that know you were joking.
Aesop: What do you want me to
those who do not genuinely John: Hey, it seems we are not do?
deliver are soon caught out. So on the same page.
if everyone in the organisation John: Leverage this opportunity
has to deliver, how to stand out Aesop: Which page? Which man, that’s the bottom-line. Like,
and be recognized? Well, you book? let’s decide the action items,
just need to speak the right follow the 80/20 rule, derive
John: Come on man, do you not maximum mileage 24/7 and get
language! Corptalk. know where I’m coming from? results fast. Like yesterday.
Corptalk is a language that no Aesop: Yes, I do. I remember.
ambitious executive can afford Aesop: I think you don’t like me.
You come from this very city, don’t This is my first day here, so to
not to learn. Know it well and you you?
are soon considered an authority start with I don’t know anything
on almost anything. Your peers John: No, no! I mean yes, I am about yesterday. I don’t think it is
look up to you and the from this city but that is not what fair to ask me about yesterday.
management regards you as very I was talking about. John: Okay, forget it. Let’s re-
promising and the one to watch. Aesop: Sir, I think I am confused visit the drawing board.
Clients are equally impressed now.
and all in all it is almost as if you Aesop: Yes, let’s do that. Where
are back to the good old Look John: Okay, no issue. Let me is the drawing board?
Busy Do Nothing days! bring you up to speed. John (takes a deep breath): You
So what exactly is Corptalk? Well, Aesop: I don’t do drugs. have lost the plot haven’t you?
to give you an idea, here is a Never mind. Do you know how
conversation between a blue- John: Drugs? Who said anything to make a cup of coffee?
eyed executive, a Corptalk expert about drugs?

40 www.triplebottomline.com.pk
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