Exploring CSR in China: Its History and Current Trends

CSR in China has, like almost everything in the country, has evolved astonishingly fast. In the early days, 30 years ago when China opened to the west, foreign companies came mainly for profits or to test the market.  But as China’s economy developed, foreign companies began to find themselves judged on their contribution to the community and on their social outreach programs - or CSR as it was coming to be known.

CSR Awareness Builds in China
This trend is now extending to local companies.  A recent study by Jigsaw International showed that a whopping 92 per cent of young employees and job seekers in China agree that it is important for a company to participate in community service.  A further 44 per cent said that in selecting a company to work for, they would consider its community service record.  This is borne out in a survey conducted by the World Economic Forum showing that 76 per cent of global CEOs view employees as the largest single group exerting pressure and creating incentives for companies to develop solid CSR.

Until recently CSR was seen by Chinese companies as either simple charity (i.e. financial donation, with no longer-term investment of time or responsibility) or as supporting the arbitrary preferred activity of the CEO, such as sport or the arts.  No link with business objectives was sought.  But increasingly now companies are finding more imaginative ways to give back.  It is therefore no surprise that another finding by Jigsaw International was that young people are eager to become personally involved with their company’s CSR (45 per cent), with global and local charitable partnerships being of equal interest, and straight donations of money being of least interest (6 per cent).

A recent study by Purdue University showed that 70 per cent of companies polled in China take responsibility for corporate communication all the way to CEO level. This could not show more clearly how seriously companies in China are taking CSR. In addition, all but one of the companies polled have established their own corporate identity system, and more than half have a department especially for crisis management.

As the government in China increasingly recognizes that it cannot do everything, NGOs have more and more latitude.  Communities are gradually becoming involved too, especially in the more developed cities, where programs are emerging such as second-hand blanket and clothing collection, and volunteer teaching.

Clearing the Path
Over the last two years, under the new government line in China of constructing a “Harmonious Society,” the path has been cleared for companies to work with the government - and also with NGOs - to develop CSR programs that address the needs of a modern and developing Chinese society.  This idea embodies a subtle change from the economic focus of previous years, to a more general overall societal balance.  It may still be glorious to get rich, but now perhaps just at a slightly less frenzied pace, and with an aim to bridge the increasing gap between rich and poor.

In China, CSR focuses on three main areas: environment, education, and health (and other social services).  Protection of the environment is a major topic, as reflected by 54 per cent of Jigsaw respondents, who chose environmental and endangered animal protection as the most important aspects of CSR (over such alternatives as the poor, the elderly, the handicapped, orphans, HIV and cultural protection).  However, there are still other areas in which companies can direct their energy, such as employee welfare, manufacturing processes and care for customers and communities.

A Social Duty
Many companies, both local and international, have identified this trend and joined the swelling tide, creating new links between the private and public sector.  Attitudes have changed, and businesses have stopped viewing CSR as a necessary evil, and instead now see it as something to be welcomed.  It is becoming a social and ethical duty, rather than merely a legal requirement.

Organizations are now keen to be seen to be improving the quality of life for their employees, members of the local community and society in general. The returns are obvious: the image of a company is increasingly seen and measured as a valuable asset.  Companies with the best CSR plans usually also have the longest-term business plans, and are therefore less prone to crises, and more attractive to investors and prospective talents.

This is becoming increasingly important as Chinese consumers, employees and communities are becoming more vocal.  A recent poll of more than a thousand people in China showed that 48 per cent have blogged.  This puts China comfortably as the number one country in Asia for bloggers, almost 20 per cent ahead of its nearest rival, creating even more reasons for companies to get involved with community outreach.

This article was written by Edward Morton Jack who has been in China for 9 years, including 3 years in Hong Kong.  With a background in business, media and broadcasting, he is now senior researcher at Ruder Finn, specializing in corporate social responsibility. It appears in the recently released PR News Guide to Best Practices in Corporate Social Responsibility, Volume 2. For more information, visit www.prnewsonline.com/store.