Tales of Two Countries

by Amanda Coffin

It boggles the mind of many a visitor to this region how Malaysia and Singapore, acrimoniously divorced in 1963, can now – a mere 46 years later – be such different worlds. The two states have much in common, certainly, but if a traveller awoke from a deep sleep whilst in transit, it would take him but a moment to discern which side of the straits he was currently on. Thus, it should come as no surprise that two CSR books from the neighbours on either side of the causeway would provide quite different reading experiences.Last year, two organisations decided to publish books about notable CSR success stories in their respective countries. Each book presents profiles of member companies willing to share their experiences as they’ve progressed towards greater social responsibility.

The Singapore Compact for CSR labels itself “the UN Global Compact focal point in Singapore.” The society originated in 2005, and approximately 40 companies comprise its membership. October marked the launch of its first publication, CSR for Sustainability and Success, which profiles ten of its member companies.

The EU-Malaysia Chamber of Commerce and Industry is a non-profit association formed in 2003 to “promote, support and develop EU business interests in Malaysia as well as facilitate trade, commerce and investments between EU and Malaysia.”  2009 also saw the publication of its book, Budi Disemai, Jasa Dituai: A Collection of Inspirational Corporate Social Responsibility Stories from Malaysia.

If the countries in question were other than Malaysia and Singapore, one might reasonably expect these books to be nearly identical. They are not. Each preface includes the wish that the book’s stories will inspire and educate readers, and I would submit that students of CSR will derive the greatest benefit from reading both books, as their dissimilarities raise provocative questions about the different ways in which companies attempt, stumble, change and succeed, as they try to become better corporate citizens. The two books also beg questions about the roles of legislation and regulation verses voluntary efforts in the movement towards greater sustainability and social responsibility.

In the foreword to the first book, Mr. Thomas Thomas, Executive Director of Singapore Compact, cited some statistics: In 2008, a survey showed that “only 27% of companies were aware of and practiced CSR.” Another 13% were aware of the term but did not claim to practice it, and the remaining 60% of companies were unaware of the term altogether. Mr. Thomas immediately adds, however, “This does not mean that Singapore companies are irresponsible. Singapore companies are not socially irresponsible.” He points out that regulation, policies, and social norms in Singapore oblige companies there to be “de facto good corporate citizens.”

The book’s editor, Evelyn S. Wong, says of the ten company profiles, “These were not rigorously researched or analysed case studies,” yet all of the writers followed one systematic framework as they gathered information from the subject firms and composed the reports. This gives the chapters either a pleasing consistency or a tiresome repetitiveness, depending upon the reader’s perspective. The ten subject firms span multiple sectors and “are global and local companies with operations in Singapore.”

One advantage of the chapters’ highly formulaic structure is that similarities between the companies’ experiences shine forth, with common sentiments and themes arising repeatedly. Nearly every company spoke of CSR as a progression over years, starting as corporate philanthropy and moving toward more active community involvement with the values integrated at every level of the firm. The companies were unanimous in stating that the impetus behind CSR values originated at the very top, with the uppermost management driving the programmes, hiring dedicated CSR management staff, and inculcating the values amongst employees and all other stakeholders. (The term stakeholder seems to be ubiquitous now in all CSR discussions and mission statements, as well, reflecting companies’ consideration of more than their financial shareholders.)

The ten companies related a wide range of CSR activities, but education, in one form or another, is always on the list. Some firms offer education to their customers in their fields of expertise: City Developments Limited (CDL) uses various means to educate tenants and buyers about energy conservation. Citi offers money management training programmes to Singaporeans of all ages. Most of the firms credited internal education efforts for reduced injuries, sick-time and turn-over amongst their staff.

There were also many common themes when addressing the question, why bother with CSR? Nearly all the companies cited the resulting goodwill amongst customers, employees and the community at large, enhancing the company’s public image. Many of the companies mentioned that high CSR standards enhanced their ability to do business abroad as well as attracting foreign investment. Mr. Thomas’ assertion that mere compliance with Singapore’s heavily regulated environment assures good corporate citizenship notwithstanding, some companies asserted that compliance is not enough. For example, a spokesman for Sembcorp Industries Ltd. stated, “Companies need to go beyond compliance if they are to stay ahead of the competition…  Companies that understand CSR as mainly compliance or philanthropy often lose opportunities to combine their core businesses with CSR.”

Some of the firms raised the issue of applying their own CSR standards to their suppliers and contractors, as well. Shell Group cancelled 49 contracts in 2008 for non-compliance with its code of conduct. In a similar vein, several of the companies have implemented secure channels by which whistle-blowers can report violations anonymously.

Although the editor encouraged all participants to share obstacles and challenges they’ve faced along the way, few obliged her.  This is perhaps understandable, but unfortunate. Common sense dictates that obstacles exist, otherwise every company would be a sterling corporate citizen. It would be instructive for companies just developing a CSR strategy to learn from the struggles that others have confronted. Most of the profiled firms continue to wrestle with the related issues of quantifying and reporting their CSR efforts. A few of them shared specific challenges: When customers voiced objection to added expenses, CDL realised the need to educate them on the value of environmentally friendly home features. NTUC Fairprice Co-Operative struggles to “engage and satisfy often contradictory needs of the various stakeholders.” A spokesman for PowerSeraya confessed that his firm has had difficulties with “the time issue faced by the staff who volunteer for environmental and community events.” Volunteers for events during working hours often feel torn between the volunteer activity and their workplace responsibilities, and weekend events face volunteer shortages, as employees have personal commitments. This conflict of volunteered time and staff responsibilities, one imagines, is more commonplace than many CSR managers would like to admit, and it would be informative to examine how various companies address it.

Loong Caesar, the head of the EUMCCI CSR Committee, translates Budi Disemai, Jasa Dituai from Malay as “benevolence will be rewarded in return,” and he adds, “This captures what the EUMCCI believes is the defining motivation behind Corporate Social Responsibility…” He reiterated the idea even more colourfully in the book’s foreword, when he distinguished CSR from philanthropy, pointing instead to a more mutually beneficial concept: “Altruism is good to have, but it does not always play a role in CSR. A clown fish does not live within an anemone because it wants to keep clean, it does so for survival of itself and the anemone.”

Like the Singaporean book, Budi Disemai, Jasa Dituai presents stories of companies who have demonstrated successful CSR initiatives, but the format is altogether different. The Malaysian editorial team elected to focus only on the CSR activities of the profiled companies and “not on the overall activities of the contributors or their motives.” In a note on the style, the editor remarks, “… the contributions have been reproduced in the format and literary style submitted by contributors and were only edited for consistency with editorial format relevance and clerical errors.” The result is a collection that feels much more diverse and vibrant than the Singaporean chapters, but it also lacks their level of detail and background.

In a general introduction to the state of CSR in Malaysia, Dr. Geoffrey Williams, CEO of OWW Consulting, even-handedly touches upon the recent advances and the still-daunting challenges. Although business in Malaysia is far less regulated than in Singapore, legislative changes are happening north of the causeway. Bursa Malaysia now requires publicly listed companies to report their CSR activity. The “Silver Book” contains CSR guidelines for government-linked companies (GLCs). The government has introduced tax and other incentives for companies wishing to pursue CSR activities. Dr. Williams concludes, “Taken together this places Malaysia’s CSR programme ahead of others in the region and amongst the most developed in the world.” Still to be tackled, however, are the country’s lagging attention to environmental issues and chronic concerns about graft and corruption.

The 23 stories at the core of the book come from a broad spectrum of sources: A garment manufacturing firm which initiated a vocational training programme for single mothers; a university which ran a campaign to educate students on the harmfulness of polystyrene packaging; a bank which identified HIV/AIDS as “a key risk factor not only to the community but also to business” and launched a wide-reaching education and outreach programme. These stories are shorter than their Singaporean counterparts, but they also read less like annual reports, and the Malaysian contributors more openly disclose their missteps and challenges. This may reflect the editorial influence, cultural differences between the two countries, or both.

The last 40 pages of Budi Disemai, Jasa Dituai contain a wealth of general information about CSR in Malaysia and additional references. Transparency International Malaysia gives an overview of the country’s current state of business ethics. It should surprise no one that bribery tops the list of malfeasance, with fraud and creative accounting getting (dis)honourable mentions. The chapter closes with a list of concrete changes – to both law and policy – that will begin to address the problems, but the author acknowledges that public apathy is also a critical factor: “A sad point to note is that Malaysian companies which suffered corruption and fraud considered such incidents as having negligible impact on their corporate image, hence there is a ‘business as usual’ attitude.”

Another article discusses the state of Socially Responsible Investing (SRI) in Malaysia, including an overview of the OWW Malaysia SRI Index, which ranks local companies based upon their good citizenship and sustainability. For the period of June 2006 – June 2009, “the OWW SRI Index showed a positive return of around 19.3% compared to the benchmark KL Composite Index which had returns of 17.9% over the same period,” illustrating clearly that CSR need not be detrimental to a stock’s overall performance. The book closes with a list of links to CSR organisations around the globe and a 115-entry CSR glossary, which is a superb reference.

CSR for Sustainability and Success, edited by Evelyn S. Wong and published by Marshall Cavendish Editions, is available at book shops throughout Singapore or by contacting the Singapore Compact directly. Budi Disemai, Jasa Dituai is published by the EU-Malaysia Chamber of Commerce and Industry and is available only at their Kuala Lumpur office. More information is here.

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