Embedding Corporate Social Responsibility and Sustainable Development into Business

The Global Compact Network Vietnam (GCNV) has recently organised the third biannual Members Meeting in Hanoi, aiming to offer its members an opportunity to share experience and methods on embedding corporate social responsibility and sustainable development into business and organisations. The event is also aimed to promote and encourage businesses to apply corporate social responsibility and principles of the United Nations Global Compact Network and bring an opportunity to members to corporate initiative on building the business/organisation strategy toward the sustainable development.

 

Mr Nguyen Quang Vinh, General Director of the Office for Business Sustainable Development (SD4B) under the Vietnam Chamber of Commerce and Industry (VCCI) and GCNV Representative, said, by August 2010, the GCNV had a total of 92 members, 55 percent of which were companies, 35 percent were on non-government organisations (NGOs), and 10 percent were business associations, and academic institutions. At the request of members, the GCNV has focused much of its recent work to developing guidance materials on corporate social responsibility (CSR) and responsible business practices in Vietnam. The goal of the GCNV is to be the national corporate social responsibility centre of excellent and support its member implement effective CSR programs in Vietnam.

 

The GCNV has completed a study on corporate social responsibility issues in Vietnam and proposed solutions, instruments and methods for businesses to embed it into their business strategies in the most sustainable and effective way.

 

Dr Richard Welford, President of CSR Asia Centre, said: “CSR and sustainable development are current burning issues. Many companies in Vietnam usually regard CSR as an expense, not a long-term investment.”

According to Dr Richard, Vietnam has a Labour Code with detailed provisions for settling such issues as working hours, minimum wages and overtime, labour surplus, women's rights, children’s labour, health and occupational safety, collective agreement and dispute settlement systems, etc. But in fact, these matters are not done thoroughly. There are many challenges in the implementation as many companies are reluctant to perform and employment inspectorates lack capabilities.

 

Besides, water and air pollution is becoming severer. Vietnam is rated 16^th in terms of biodiversity in the world. Nonetheless, the ecosystem with the highest biodiversity is now being deteriorated. Vietnam is typically vulnerable to adverse impacts of climate change, especially along the coastline. Meanwhile, according to Dr Richard, environment laws in Vietnam are ineffectively in force. Most domestic companies see environmental protection as an additional cost they cannot afford.

 

Dr Richard also said that despite good anticorruption efforts, the Government has warned that corruption remains serious and turns more complex. Sweeteners are very popular in Vietnam and have become a smoother for daily business activities. For businesses, corruption is a major obstacle to doing business and affect economic development in general.

 

“If enterprises care about these problems and embed CSR into business, they will surely increase the value of their business if they achieve the balance of maintaining profitability and implementing corporate social responsibility effectively while Vietnam can benefit more responsible companies. Therefore, they need to develop strategies to solve important problems," said Dr Richard.

 

According to Dr Richard, while working with CSR Asia, all companies ask for CSR assistance. Thus, according to CSR Asia, to help companies do better CSR, they need to deal with this matter at three levels.

Level 1, companies start implementing CSR, identifying their resources (time, financial, consultancy and technical services) to commence implementation systems and programmes to build at least one field of the UN Global Compact. As regards governance and policy systems, companies need policies with respect to workplace, health, safety, environment, human rights and community participation.

 

Level 2, companies gradually embed CSR into their business strategies. They need sufficient resources to support appointed CSR directors and programmes in two fields of the UN Global Compact. They need to be aware that resources allocated to initiatives are part of investments for building up their image and reputation in the long horizon. As such, they need specific policies codes of conduct for managers and workers at two fields of the UN Global Compact at least (such as employment problems and corruption prevention.)

 

Level 3, they strategically implement CSR in their production and business process. They need long-term commitments for resources from high-level management to ensure that they can improve CSR. Then, companies need detailed policies and codes of conduct, specific commitments, clear strategies for good labour practices, health and safety, environmental protection, human rights, anti-corruption, development and community participation.