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Sun, May 11, 2008 07:50:34 PMFrom:
Business Respect
Subject:
Business Respect - CSR Dispatches No#127 - 11 May 2008
Business Respect - CSR Dispatches No#127 - 11 May 2008
==================
An email newsletter with news and discussion focusing on corporate
social responsibility globally, looking at the companies in the news
and the emerging issues. Linked to the website at
http://www.mallenbaker.net and produced every two weeks.
In this issue, we consider the plight of the Olympic Games sponsors.
In the news:
1. China: Sino Gold attacked via TV programme
2. EU: Airlines breaching consumer rules on websites
3. Germany: Adidas boss criticises Olympics protestors
4. New Zealand: Major companies criticise climate change bill
5. Unilever commits to traceable palm oil by 2015
6. France: Alstom denies bribery investigations
7. Singapore: Drug companies urged to market responsibly
8. UK: Shell pulls from huge wind farm project
9. Exxon Mobil, Lukoil, CNOOC at the bottom for transparency
Feature articles on the internet:
1. Is There Any Way to Stop Wal-Mart & Co. from Sweatshop
Profiteering? - 29 Aug 2008 FROM Alternet
2. What does CSR really mean? - 7 May 2008 FROM Business Daily
(Africa)
3. Virtue's reward? Companies make the business case for ethical
initiatives - 27 Apr 2008 FROM The Financial Times
===================
Topics:
Welcome
CSR News 11 May 2008
CSR FEATURES from the internet
Recent entries from Mallen's blog
Playing games with the Olympic sponsors
Want to read a hyperlinked version of this issue? You can find one on
the website at http://www.mallenbaker.net/csr/nl/127.html.
Copyright 2008 Mallen Baker. All rights reserved. For information on how
to subscribe, go to http://www.mallenbaker.net/csr/nl/subscribe.html.
------ This issue of Business Respect sponsored in part by: ----------
* The Social Marketing Network: This is a network for people like you
committed to change for good. It is brought to you by leading
communications, campaigning and CSR company Corporate Culture.
More info: http://www.mallenbaker.net/jump.php?Link=2
* GoodCorporation conducts cutting edge audits of best business
practice, taking companies beyond CR reporting and into sound
business management. We have worked for over 250 organisations in 40
countries. More info: http://www.mallenbaker.net/jump.php?Link=23
----- Help support Business Respect by supporting our sponsors ------
Welcome
* For companies, working out just how they should respond to the
changing expectations on them can be a bewildering affair. On the one
hand, there are times when they need to hear the mood music in the
distance and move quickly to shift their business model to meet a
challenging new environment. Sometimes it can be as simple as
listening to what key stakeholders are saying, learning and
absorbing.
Often, it is not so simple.
Some campaigning issues have equally passionate stakeholder advocates
on both sides of the argument. And sometimes the stakeholders
concerned simply have no interest in the situation the company is in,
and its interest on behalf of its employees, its customers, its
shareholders (including all those pension funds) in finding its way
through the morass - they just want the company to act as a vehicle
for their campaign objectives.
Arguably, that is the position that the Olympic sponsors find
themselves in. It's a high temperature, controversial area at the
moment, but one well worth exploring with this issue's main feature.
Let your views be known if you disagree!
In the mean time, I am delighted to welcome Business Respect's second
corporate sponsor, who joins us from this edition onwards. Good
Corporation was founded in 2000 in order to help companies to measure
their impacts in a credible way. Good Corporation is not a
consultancy, and therefore doesn't gain anything by identifying
weaknesses in its clients' business practices. But it has set one of
the de facto standards in CSR business practice, and carries out
assessments for companies across the world.
They also hold topical debates on key emerging issues - I carried an
article recently on the discussion at the UK's House of Lords focusing
on the fairness or otherwise by the banking sector. I hope to cover
more of these over the year. Give them a look.
Other sponsor news - the Change for Good network, our first sponsor -
has changed its name to the Social Marketing Network. Starting from
next issue, we will be making individual insights from the network
available to readers of Business Respect. Having attended several of
the London network meetings so far, I can recommend them, and the
network in general, as a gathering point for individuals committed to
making a difference.
The support of sponsors enables us to continue to produce Business
Respect as a free resource to the CSR community, so we encourage you
to support them.
Mallen Baker
mallen@mallenbaker.net
===================
CSR News
* China: Sino Gold attacked via TV programme
Mining company Sino Gold has found itself the target of official
criticism via the China Central Television (CCTV) which accused the
company of poisoning water, running roughshod over the concerns of
local people and enjoying tax-free profits as a result.
The attack, which has been broadcast several times, and the transcript
for which has appeared widely on internet news and blog sites, was
criticised by the company for being "hugely biased" and being riddled
with large numbers of "gross inaccuracies". For example, it answered
the claim that it had failed to contribute anything to the local
economy by observing that it had invested 46m yuan in local
programmes.
Other companies active in China have expressed the fear that the
biased programme may reflect an emerging official campaign to keep
foreign mining companies out of China and to favour local firms
instead.
* EU: Airlines breaching consumer rules on websites
The European Commission has said that it intends to take action
against airlines that continue to mislead customers with their
websites as to the real cost of flights.
According to the Commission, one in three European consumers are being
misled as they purchase tickets online, with around half of 137
websites breaching EU consumer rules.
A review of sites last year found that the 137 had breached rules on
clear pricing, availability of offers or clear contracts. Many have
failed to rectify the failing since. The main failing is that many
airlines separate out components of the cost to suggest cheaper fares
than is actually the case, stripping out charges such as airport
taxes, booking fees or credit card payment charges.
* Germany: Adidas boss criticises Olympics protestors
Herbet Hainer, the CEO of Adidas, has said that he does not regret
sponsoring the Olympic Games, and criticised pro-Tibet protestors that
tried to disrupt the progress of the Olympic torch.
In an interview with Spiegel, he said that although protestors had
every right to proclaim their political views, he did not believe they
had the right to disrupt the torch procession or to try to extinguish
the flame. Adidas is sponsoring 16 national teams for the Olympics,
including China.
"The Olympic Games have been a part of our brand for years," he said.
The company would resist the effort made by campaigners to drag the
company into politics.
Asked about whether the company had suffered damage to its reputation,
he said "We've had more e-mail complaints in recent days about the use
of kangaroo leather in our shoe products than about China."
* New Zealand: Major companies criticise climate change bill
Fonterra, Solid Energy and Todd Energy joined together to criticise
the government's Climate Change (Emissions Trade and Renewable
Preference) Bill on the grounds that it would disadvantage New Zealand
business without achieving its environmental goals.
According to the companies, whose criticisms echoed previous comments
from business organisations, the legislation would benefit government
through windfall taxes, but would hit companies that had limited
ability to make changes, such as the dairy industry and methane
emissions from cattle.
Fonterra said that the proposals would cost it $500m a year, enough to
make it lose its competitive edge, but with no benefit to the economy
overall.
The three companies have called for implementation of the legislation
to be put on hold whilst problems are resolved. The government has
said that it disagrees with some of the possible scenarios the
companies have painted.
* Unilever commits to traceable palm oil by 2015
Unilever, one of the biggest consumers of palm oil, has announced that
it would back a moratorium on further palm oil related deforestation
in Indonesia, and it commits to using only fully traceable palm oil by
2015.
The company, which made the announcement at an environmental summit
hosted by the UK Prince of Wales and the Prime Minister organised by
Business in the Community, uses the material in many of its products
and has led attempts to address sustainability in palm oil over recent
years.
Unilever CEO Patrick Cescau said that the company would focus on its
suppliers, getting them to certify the palm oil from their own
plantations as well as the oil that they buy in from elsewhere.
The move was preceded by the company being singled out by Greenpeace
campaigners who dressed up as orangutans and scaled the firm's London
headquarters. Environmental campaigner Jonathon Porritt said that the
company had been planning its action for a number of months and the
move had not been prompted by the Greenpeace action, which he felt
unfairly targeted a leading company on the issue.
* France: Alstom denies bribery investigations
Engineering giant Alstom has seen its staff approached by Swiss
regulators as part of an investigation into bribery, but the company
has denied reports that suggested it was the target of the
investigations.
Alstom said in response to reports in US papers that "no legal
procedure has targeted the company in the matter of corruption". It
said that a number of employees were being questioned as witnesses.
The Wall Street Journal had said that Alstom was suspected of paying
bribes to win contracts in Asia and South America, a suggestion that
the company dismissed as speculation.
* Singapore: Drug companies urged to market responsibly
The Health Sciences Authority in Singapore has urged drug companies
there to practice responsible marketing in how drugs are promoted to
the public.
According to CSR Asia, the companies have been told to stop running
adverts positioned as being educational when they fall short of the
expectations of such material.
An advert run by GlaxoSmithKline on cervical cancer was named in
example. The ad does not list the symptoms of the disease or mention
risk factors, and it simply uses fear to promote its drug.
The company denies using fear as a promotional tool.
* UK: Shell pulls from huge wind farm project
Shell has provoked criticism from environmental groups when it
announced that it would pull out of a project to build the world's
largest wind farm, the London Array scheme. The company said that it
wanted to focus on wind power in the US where government incentives
offered more competitive returns.
Shell was one of three equal shareholders for the project, which may
now be in doubt, alongside Eon and Dong energy.
The UK government's Environment Secretary Hilary Benn said that people
would struggle to understand why the company had taken this action in
a week when it had announced record profits.
The company said that its decision was purely economic and reflected
no lessening of its commitment to wind power. Costs for the London
Array project had doubled over the last five years.
* Exxon Mobil, Lukoil, CNOOC at the bottom for transparency
According to a new report by Transparency International, Exxon Mobil,
Lukoil and CNOOC are all in the bottom group for transparency amongst
the oil and gas majors. The result came from a survey carried out of
42 such firms.
The report found that others, including Shell, BHP Billiton, Petrobas
and Talisman Energy scored highly in the transparency stakes, with BP
coming in amidst the middle group.
According to Transparency International, lack of transparency in how
companies operate, particularly in countries with weak standards of
governance, can cause corruption and harm the poor. The organisation
has said that oil companies should report more detail around moneys
paid to governments for oil rights.
Exxon said that it rejected the report's conclusions, and that it
disagreed with the methodology used to come to the final results.
==============================
CSR FEATURES from the Internet
* 1. Is There Any Way to Stop Wal-Mart & Co. from Sweatshop
Profiteering? - 29 Aug 2008 FROM Alternet
I remember one particularly bad factory in China. It produced
outdoor tables, parasols, and gazebos, and the place was a mess. Work
floors were so crowded with production materials that I could barely
make my way from one end to the other. In one area, where metals were
being chemically treated, workers squatted at the edge of steaming
pools as if contemplating a sudden, final swim.
http://www.mallenbaker.net/jump.php?Link=24
* 2. What does CSR really mean? - 7 May 2008 FROM Business Daily
(Africa)
The late Milton Friedmann once argued that „in a free enterprise,
private-property system, a corporate executive is an employee of the
owners of the business. He has direct responsibility to his
employers.
That responsibility is to conduct the business in accordance with
their desires, which generally will be to make as much money as
possible while conforming to the basic rules of the society, both of
those embodied in law and those in ethical custom.
http://www.mallenbaker.net/jump.php?Link=25
* 3. Virtue's reward? Companies make the business case for ethical
initiatives - 27 Apr 2008 FROM The Financial Times
In Unilever's London headquarters, Gavin Neath, the consumer goods
group's head of sustainability, takes a plastic contraption out of its
cardboard box and places it on a table. It looks like a small and
semi-transparent version of the vending machines that dispense drinks
to office workers.
The device is called a Pureit - and it is a drinks dispensing machine
of sorts. Developed by Hindustan Unilever, the company's Indian
subsidiary, the Pureit provides drinking water from any source,
however polluted, purifying it with a series of meshes, parasite and
pesticide traps and a germ-killing battery kit, without the need for
boiling and without the use of mains electricity.
http://www.mallenbaker.net/jump.php?Link=26
==============================
Recent entries from Mallen's blog
* Food companies - hear the sound of the oncoming train and get out of the
way! - 6 May 2008
A few years ago, I remember hearing the reaction of certain food
companies to the suggestion that rising levels of obesity in the
population were going to be an issue for them. That reaction was
abrupt, aggressive and fearful - as though the mere suggestion might
bring it to pass. I fear that the same reaction might come about with
the inevitable focus that will come onto them with the growing global
food crisis.
http://www.mallenbaker.net/blog/post.php?id=68
==============================
* Playing games with the Olympic sponsors
Article by Mallen Baker
Unpopular though it may be, I feel compelled to pitch a defence on
behalf of the corporate sponsors of the 2008 Olympics. The battering
they have taken has been very little to do with corporate social
responsibility, and it's time the debate moved on.
Let's start off with the event itself. The Olympic games are a good
thing. It is a symbol that has had powerful resonance through the
ages, and is about fellowship and friendly competition and so on. It
is good that companies sponsor the Olympic games and help to make them
happen. If companies stayed away, it would be to the detriment of the
world community.
No government has suggested that this year's games should be
cancelled. No country has, to date, said that it intends to boycott
the games. If they did, they would suffer relatively lightly.
Disappointment for that country's athletes, of course. Some grumbling
from the Chinese government, inevitably. But governments provoke such
grumbling whenever they meet the Dalai Lama, and the business of
government goes on.
So far, we have heard that a few country leaders have diary
commitments that make it impossible to attend both the opening and
closing ceremonies of the games, none of whom are attributing this to
anything related to human rights. Wow.
The companies are being asked to sacrifice so much more ˆ and the
campaigners dismiss such suggestions far too lightly.
China is one of the biggest growing markets in the world. Any global
company wants to be a part of the business community that serves that
growing market. Those that didn't might well find that their next, and
most powerful, new competitor would spring out of the space they had
left. See Google's discomfort at the growing successful force of
Baidu, the home grown search engine company.
As things currently stand with Chinese politics, a company that
calculatedly insults the Chinese government will effectively lose its
licence to develop that market, and the Chinese government‚s
definition of an insult is pretty broad ˆ it can easily include a
public statement by the company relating to China and human rights.
Does that mean that standing against the Chinese government can never
be justified? Of course not. If your company is being seriously
expected to be complicit in activities that go against your corporate
values, you have to find a way through. This was the challenge facing
Microsoft and Yahoo when it was suggested that their response to the
legal requirements for information about people who posted messages on
their servers would be active facilitation of the abuse of those
individuals' human rights.
That is not the issue here. These companies are being asked to make
pretty symbolic statements. Such statements will not affect China‚s
policy in relation to Tibet one iota. Really. But the price to be paid
for this empty gesture will be to damage access, if not lose it
altogether, to over a billion potential customers.
No government is making this sacrifice. Neither is anyone else.
The campaigners are picking on the Olympic sponsors because they can.
They can picket the local stores, or offices - they can do spoofs of
the logos. Their efforts will distribute via Youtube and elsewhere
because bashing companies is both easy and fun. But it has nothing to
do with really changing things on the ground in Tibet, therefore it
simply joins a long roll-call of campaigning targets which is more
about the self-indulgence of the campaigners than it is about any
clearly delineated strategy to achieve campaigning goals.
If Coca-Cola, or McDonald's, or Johnson & Johnson, were forced to
withdraw from China, there is no evidence whatsoever that those that
would spring up to fill the vacuum would be as committed as those
companies are to social responsibility.
Of course, as I often tell companies you can win the science and lose
the argument. The companies may eventually be forced into actions
regardless. Or they may get through the Olympics, but only by
suffering significant reputational damage at home that people quote
against them as a case study for years to come. At the moment, I hope
that they get through the process intact. That is not the same as a
blank cheque to do whatever they need to in coming years in order to
stay in favour with the Chinese government, by the way.
But it is recognition that reluctance to indulge in futile gestures is
not the same as corporate irresponsibility.
=================================
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