Sustainable Business and CSR: Integral Parts of Development Strategies

On October 8, 2011, the Vietnam Business Forum: Sustainable Business and Corporate Social Responsibility was held by the coordination of Vietnam Business Council for Sustainable Development (VBCSD) under the Vietnam Chamber of Commerce and Industry (VCCI) with the project “Helping Vietnamese Small and Medium Enterprises Adapt and Adopt Corporate Social Responsibility (CSR) for Improved Linkages with Global Supply Chains in Sustainable Production” which is funded by the Switch-Asia-Programme of the European Union.

The forum had about 270 leaders from corporates and organizations, focusing on addressing emerging CSR issues in Vietnam; the reasons why enterprises should implement CSR; advantages and disadvantages for Vietnam enterprises to implement CSR; and the role of government and related stakeholders in CSR implementation towards sustainable business and development

 

Deputy Prime Minister Hoang Trung Hai sent a congratulation letter to the forum, of which, he appreciated businesses’ efforts in such a challenging period of marcoeconomic unstability and expressed that this forum is surely an opportunity for businesses to discuss about development strategies together and propose government having apprepriate policies.s.

At the forum, Mr Vu Tien Loc, VCCI Chairman & President stated that substainable business and CSR implementation plays a vital role in this era of globalization to help Vietnamese businesses overcome technical barriers, penetrate international market and raise competitive competences.overcome technical barriers, penetrate international market and raise competitive competences.

Meanwhile, Mr Patrick Gilabert, UNIDO Country Representative to Vietnam emphased that today global trends are changing, as requirements of the markets, driven by the final consumer, are tending to go beyond environmental compliance the topic Social Responsibility is on the way to become a substantial of the competitiveness of companies. He also stated that most of Vietnamese enterprises are facing a challenge of having insufficient capacity to comply with the strict requirements of CSR so that they have not been able to receive the full benefits of increasing foreign direct investment and becoming WTO membership. Such regulations as EU RoHS & REACH or ISO standards are bringing grave constraint for them, over 90 percent of which are small and medium sized enterprises (SMEs). Adoption of CSR as an integral part of the business strategy of firms can have a competitiveness enhancing impact on the SMEs in both buyer-driven and producer-driven chains. for them, over 90 percent of which are small and medium sized enterprises (SMEs). Adoption of CSR as an integral part of the business strategy of firms can have a competitiveness enhancing impact on the SMEs in both buyer-driven and producer-driven chains.

Besides, there was a panel discussion on examples and opportunities of corporation responsibility, Vietnam Business Forum quoted some opinions as follows:

 

CSR has truly become a robust campaign and developed widespread across the world. The consumers in Europe and Americas pay attention not only to product quality but also the way a product is made by a company, e.g. impact on the environment or the health of the entire community. Under the society’s pressure, most of major corporations have seriously embedded CSR in their own action plans and development strategies. In general, CSR has positioned itself in the corporate perceptions in a wealth of the globe countries.

 

Recently, after several scandals where companies caused pollutions that deteriorate the environment or their products can cause harm to people’s health such as Vedan company discharged unprocessed waste water to the Thi Vai river, or the case of melamine milk power in China, the community gets increasingly interested in the matter and has explicit responses to the violators namely say no to the products manufactured by the violators. Immediately, the violators’ business operations are affected significantly and may go bankrupt as a result if they do not present timely remedies. Their reputation is seriously impaired and it takes surely a lot of time and resources to restore the tarnished fame.

 

So, corporate sustainable development and CSR are the two closely integral and complementary parts. For CSR is integrated in every stage of the business process of a company, then CSR is to be taken into account immediately from the time when a corporate business strategy is formulated and resources are prepared for the implementation of the strategy. However, for CSR to become an integral part of a sustainable development strategy, a company needs to assess the associated opportunities as well as to be aware of the challenges so that it can devise an appropriate solution.

The ASEAN has  adopted the Roadmap for ASEAN Community 2009 - 2015 which contains blueprints for an ASEAN Socio - Cultural Community, with its strategic objectives to “ensure that Corporate Social Responsibility (CSR) is incorporated in the corporate agenda and to contribute towards sustainable socio - economic development in ASEAN Member States.”  

Thus, it is extremely crucial for businesses in the member countries of the ASEAN CSR Network to know how they take account of their economic, social and environmental impact in the way they operate.

Therefore, companies should also seek to contribute to achieving the following United Nations Millennium Development Goals (MDGs): Eradicate extreme poverty and hunger; Achieve universal primary education; Promote gender equality and empower women; Reduce child mortality rate; Improve maternal health; Combat HIV/AIDS, malaria, and other diseases; Ensure environmental sustainability; Develop a global partnership for development.

Besides, there are useful benchmarks for responsible business such as ILO Tripartite Declaration of Principles concerning MNEs and Social Policy, the OECD Guidelines for MNEs and the United Nations Global Compact, ISO2600 and Global Reporting Initiative to achieve the MDGs.  

This Statement supports the UN Global Compact principles and ISO26000, and defines business approach as engaging with stakeholders to achieve the greater goal of sustainable development. 

 

Environmental protection is no longer a matter of a particular country, but becomes a global concern. Humanity is facing many challenges of environmental degradation, especially climate change, ozone depletion and the increase of natural disasters (earthquakes, droughts, floods..).

 

For the tourism industry, currently, more and more tourist interest in the conditions of security, safety and health. Therefore, the choice of accommodation establishment and tourist services make great environmental protection issues is the current popular trend. Only the tourist destinations ensure the environmental protection, only the green – clean – nice places with safety products could be competitive to attract the customers, and from there the tourism businesses and the local people could get benefits from tourism.

 

In the recent years, great efforts by Saigon Tourist system to apply and maintain the environmental management system (EMS) in accordance with ISO 14001 in tourist environment management, the hotels belong to Saigon Tourist system have contributed greatly to healthy environment which supported many defects and pollution.

 

These efforts and many advances in business of the affiliates have shown a willingness and great effort in environmental protection. That gives a many meaningful sense which is the assertion, the determination of the leaders of Saigon Tourist and the responsibility of the business to the society and the sustainable development of Saigon Tourist with the affiliates, contribute to build a strong brand of Vietnam tourism.

 

Environment is where the human being live and the society exist. Environmental protection is currently a global concern. Environmental protection is not only an urgent task of tourism industry, but also of all levels of society to develop sustainable tourism, improve life standards of each local, each sector and each individual in the society.

 

Concerning the environmental protection responsibility of the tourist, the local people and the other organizations: “ The protection and preservation of scenic, environment, cultural identity, customs and habits, with civilized and polite behavior is to improve the country, people and tourism image of Vietnam”. It also means that the environmental tourism is affected by the behavior of many entities, including the entities operating in tourism sector and those not directly involved in the tourist activities. Therefore, the tourism environment could only be protected effectively when all the stakeholders realize well their responsibility.

 

An Inclusive Business is a profitable and sustainable entrepreneurial initiative that seeks to contribute to poverty reduction by including lower-income communities within the value chains of companies as employees, suppliers, consumers or distributors, in a win-win situation.

 

SNV uses the inclusive business approach to identify opportunities for job creation, income earning and access to basic services for the low-income population excluded from economic processes. 

 

SNV has implemented over 125 successful Inclusive Businesses around the world, in agri-business, financial services, ICT, low-cost housing, forestry, biofuels, tourism, and consumer products, amongst others, which have generated a sustainable impact for more than 500,000 households in Asia, Africa and Latin America.

 

In Vietnam, SNV has been actively promoting Inclusive Business and conducted several interventions in agriculture (cassava, tea, jatropha, etc.), basic goods and services (microfinance, water purifiers, etc.), amongst others.

 

As a result of this study, and acting on the idea of social and economic inclusion through the integration of the poor into mainstream business, the ADB has decided to establish by mid next year (2012) the first Mekong Sub-region Inclusive Business Investment Fund (with an estimated size of 100-120 million USD, seed investment from the ADB, covering Vietnam, as the main focus, + Laos, Cambodia and Thailand) that will provide equity and/or debt investments for companies to implement inclusive business initiatives that directly integrate labour, products, and consumers from low-income segments of Vietnam’s society.1 These investments will be looking for a blended type of return, including a financial return and a social return as a result of these investments.