How to understand corporate social responsibility
Fifty years ago, this concept was understood as a call for property managers not to undermine the rights and interests of others, and as a call for charity to make restitution for damages done to the society caused by the enterprise, including the living environment. In recent years, in Viet Nam, people often use the definition of “The research team about the private economic development” of the World Bank, according to which “CSR: Corporate Social Responsibility is the commitment of the corporation to contribute to the economic development through activities to improve the quality of life for workers and their families, the community and society in a way that benefits both corporations and the general development of the society “. That long explanation is used by lots of people in a simple way through charitable activities and environmental protection. Actually, the concept of the Corporate Social Responsibility is very different.
Charities come from the short term of the kindness. The voluntary work of many corporations and entrepreneurs is very honorable, except for some charities, which are marketing activities and targeting profit purposes. Meanwhile, the Corporate social responsibility is a long term voluntary commitment, which is done in many areas such as developing the human ability, reforming society like opening schools, building hospitals, museums … We can understand the charity is like giving someone fishes while the social responsibility is giving them fishing-rod.
Ten years ago, Vietnam Chamber of Commerce and Industry, Ministry of labor, War Invalids and Social Affairs, Ministry of Industry and Trade, along with leather – footwear association and textile garment association created a prize “the Corporate social responsibility toward sustainability” to honor Corporation make good social responsibility during the integration. However, a survey of the Central Management Research Institute made 3 years ago shows that almost all of the Vietnam corporation do not clearly understand about the social responsibility that needs to comply with, and of course do not know what to do to meet this requirement.
The Vietnam corporations do not know the content of the concept of social responsibility so it is very difficult to imagine the effect on enterprise operations and Vietnam’s economy. Figures made by the research agency above indicating that only 36% of asked corporations know about the implementation social responsibility monitoring department, 28% of corporations executive to protect the environment, 5% said they contribute to the health care industry.
The information is nothing bright in the process of economic integration in the world, while most of our partners considering social responsibility is not only a commitment but also a sacred duty.
We have just signed Trans-Pacific Partnership (TPP) in which one of the new points is a higher commitment of social responsibility. In the 14 issues negotiated in the many different fields have 2 items bearing connotations of CSR, not to mention this content mentioned scattered in many items more.
Specifically, the corporate social responsibility is expressed through the following aspects: (1) environmental protection, (2) Contributing to the social community, (3) Making good responsibility with suppliers, (4) Ensuring safety and benefit for consumers, (5) Making good relationship with employees, (6) guaranteeing benefits to shareholders and employees in the corporation
In fact, these commitments are related to the people and for the people. For example, the responsibility to have rightful behaviors with the workers, which is one of the important elements of the corporation and also is the subject impacted by social policies. The Economist – Pham Chi Lan said that when participating in labor commitments in TPP we have many advantages in the long term for both workers and employers.
Finally, with the comprehensive integration, when international partners, importers requiring Vietnam corporations comply with global standards of labor safety, health care workers, environmental protection … will help us improve productivity significantly, this means increasing the competitive advantages in the environmental integration.
The result of recent survey by the Institute of Labor Science and Social Affairs conducted on 24 corporations about leather-footwear and textile garment industry has shown that the revenue has increased by 25% by implementing social responsibility programs, the productivity also has increased from 34.2 million up to 35.8 million/a labor/ year; exported goods rate has increased from 94% up to 97%. That is not to mention the corporation has consolidated the trust with customers, make a connection internally as well as attract highly qualified workers.
Business operations in integration time, the corporations also aim at the final consumers of their products rather than intermediate customers. The society has many people who use products made by the corporation, and that corporation has to responsible for these consumers. This is the biggest responsibility because it involving in the community.
We can tell that the corporate social responsibility in this case is the commitment about product qualities, honesty in marketing products, as well as ensuring the safety for the user. The corporations that do not make this commitment, then the biggest loss is not the punishment of the law, it is the customers turn their back on that corporation. The community and consumer’s trust in many cases are built through the corporate social responsibility; in history, there were many corporations passing the bankruptcy threats thanks to the sharing of the consumer community.
Standing in front of comprehensive integration, we often express excitement when talking about the advantages and disadvantages, and foreseeing competitive challenges of a market when the economy is under development. Whereas the compliance with the commitment to the corporate social responsibility seems not to promote in the process of preparing to enter the contest. This is a troubling thing.
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