Global Compact Network Singapore

Large corporations

Pursuing responsible business practices has long helped businesses to enhance their reputation and standing within the community they operate in by building trust with their stakeholders, giving them the social license to operate. The benefits of such goodwill include increased bottom line, positive publicity and engaged employees. Most companies go through three stages of CSR development:

3 stages CSR

Large corporations today face an exponential increase in internal and external business risks. Embedding CSR into its core business functions is crucial in helping companies dealing with an increasingly complex business environment, making it not only a risk management strategy but also adds value for the corporation in the long run.

Here are some practical reasons for doing so:

  • Supply chain:
    Long supply chains are now the norm for most large businesses, and the exposure to risks regarding product safety, source traceability, labour rights issues and corruption increases as a result. Companies which operate within a CSR framework are in a better position to make an assessment their key stakeholders, the positive and negative impact their business operation has on these stakeholders and how they can mitigate the negative impact.

    For instance, a company with long supply chains can mitigate its risks by setting a policy, framework and code of conduct that are aligned with its’ CSR vision, so that both employees and suppliers are better able to understand the expectations of the company.

  • Regulatory and legislative environment:
    Multi-national corporations operate in various locations under different legal jurisdictions and varying regulatory standards. Globally, there is a growing trend towards tightening of regulatory and legislative frameworks, especially in the areas of environment protection and anti-corruption. As a business strategy, companies using the CSR framework would be better equipped to look beyond merely complying with existing regulations and obligations, and integrate environmental and societal concerns of their key stakeholders in their business operations.

  • Talent management and retention:
    Corporations face the challenge of attracting and retaining employees with the right expertise, skillset and disposition to grow their businesses. The war for talent is particularly challenging in companies in countries like Singapore that experiences low unemployment rate. Beyond offering attractive remuneration, providing a conducive work environment and other benefits are important tools that corporations use win the talent war. Having a holistic CSR framework that puts its employees as a key stakeholder can help a corporation to focus its strategies in talent management. The upside is that the corporation enjoys a good reputation as an employer of choice, attracts more talent which keeps the cost pressures of recruitment and re-training down and has an engaged workforce.

    Often, an engaged workforce is the key lever in driving innovation and business growth for a company.

  • Media and civil society:
    Never before have corporations come under greater public scrutiny in the way they operate, and this is thanks to the development of the social media and smartphone technology over the past decade.

    Civil societies in countries such as Singapore are still in the nascent stages of development and the level of consumer advocacy low, but with the social media as a major source of information for consumers, unethical and irresponsible corporate behaviours endorsement good corporate practices and ethical businesses are amplified through “word-of-mouth” to a much wider, global audience. Corporations that have their fundamentals right and employ the CSR framework would be in a better stead to engage their key stakeholders and manage risks associated with their businesses in order to build a relationship of trust with consumers.

Need help to start on your journey?

Embedding CSR into your business may not be as difficult as it sounds. The first steps involve gaining management’s buy-in on CSR and sustainability and understanding the level awareness in CSR in your company, assessing what you are currently doing well in, engaging key stakeholders and seeking buy-in before even the first word is written about your company’s CSR policy. Click here to access a CSR toolkit developed by Singapore Compact, which may be of help to you as you start on your company’s CSR journey.

The importance of communicating your CSR initiatives

Setting a CSR policy for your company, embedding CSR into your business strategy and putting it into practice are all crucial as you start your CSR journey. Another important step is to communicate to your stakeholders what the CSR initiatives that you have put in place and are implementing. This serves the dual function of transparency and accountability – so that your stakeholders are educated and aware of what your company is doing and how it is working to improve its practices. Sustainability reporting is one way in which company shares this information with key stakeholders. Find out more about sustainability reporting.

More resources to support you on your CSR journey

CSR thought leadership from global business leaders

Management leadership and belief in the CSR and sustainability agenda is critical in having a company adopt CSR.

In September 2013, UN Global Compact and Accenture released the results of a global study on the views of 1,000 top business leaders regarding sustainability challenges. Eighty-four percent (84%) of the CEOs surveyed believed that businesses should lead the way in addressing sustainability challenges, with 78% saying that they believed sustainability is a route to growth and innovation, and 79% believing that it will lead to competitive advantage in their industry. However, 67% of the CEOs surveyed believed that business is not doing enough to address global sustainability challenges.

The study also found leaders who are ‘transformational’ leading the way in the sustainability agenda, by being more likely to see sustainability as an opportunity for growth and innovation, investing in innovation and deploying new technologies to advance sustainability and fully quantifying and tracking the positive value of sustainability to their companies and their impact on the communities where they operate in.

Visit http://www.accenture.com/microsites/ungc-ceo-study/Pages/home.aspx to find out more about the study. To download a copy, click here.

Supply chain and procurement
Large corporations often face CSR and sustainability challenges within their supply chain and in their procurement processes. These two resource links may provide useful information to support you in facing these challenges:

UN Global Compact Sustainable Supply Chain: http://supply-chain.unglobalcompact.org/

UN Global Marketplace – sustainable procurement:
https://www.ungm.org/Public/KnowledgeCentre/SustainableProcurement

How to Start CSR

How start CSR

A supportive hand on your CSR journey

Find out more about the programmes that Singapore Compact run to support companies wanting to start on the CSR journey, and existing practitioners who want to deepen their knowledge.
 
Singapore Compact members enjoy preferential rates when they sign up for training courses, and invitations to free "members' only" sessions where they network with other CSR practitioners and exchange ideas on how to enhance their CSR initiatives. Find out about Singapore Compact membership here.