- corporate social responsibility - the conscience of an organisation

Can 'conscience' be used as a business strategy? If you think about it would you rather deal with people with a 'conscience' or uncaring, irresponsible people using any means to justify the end result?

The conscience of the corporate world today is corporate social responsibility or CSR in short. By embracing the tenets of CSR, it has proved that this could lead to enhancing a company's reputation, risk management and sustainable business. For example, there is a growing trend for investment preferences to be increasingly monitored towards ethical or socially responsible investment in line with personal moral, ethical and religious values. For example, managed socially responsible investment portfolios grew by 56% during the 2006 financial year from $7.67 billion to $11.98 billion in Australia. In Europe, there are 388 green, social and ethical funds as at 30 June 2006 compared to 280 funds in 2001. McDonald suffered bad press publicity and involved in expensive lawsuits for causing obesity, and saw a drop in its share price. It then re-examined the way it conducted its business. The result was that it moved from “greasy fingers to green fingers” with the introduction in 2003 of salads to its menu and encouraged its customers to lead a balanced lifestyle in its campaign. This strategy has a positive impact; resulting in increase in sales and its share price .

Malaysian companies need to do much more in CSR. Many Malaysian companies still think of CSR in terms of philanthropy. They pride themselves by the amount of donations they donate each year or the number of school projects they financed. This is just an image projection exercise. What they need to do is to integrate responsible and ethical practices in all aspects of its operations, including ensuring that its business practices do no harm to the environment and that it contributes towards the development of capacity within a community to facilitate long term sustainability.

We have lived and prospered over the past few centuries. Why are CSR issues only being addressed now? I would put down to two factors. Scarcity of resources and an increasing knowledge world. In the past our planet was blessed with abundant resources and natural environment. The world was larger then. Today, our planet resources are becoming scarce due to our propensity to industrial development which depletes the earth's resources at an alarming rate. The advent of information technology bridges the knowledge gap amongst the developed, developing and under-developed nations. The divide is getting narrower.

In the old days, it was perfectly normal for the white masters to keep slaves, Chinese towkays to keep concubines. In fact their success and social status were judged by the number of slaves and concubines they kept but such practices are unthinkable today.

So, those who choose to ignore CSR will ultimately face sanctions from their clients, business associates, shareholders and the world at large.