Turning Thailand’s Useless CSR Into an Engine for Profits and Communities
April 20, 2016
Dr. D. Michael Shafer
SPECIAL TO THE NATION
A few years ago the president of a major Thai bank said to me: “Corporate Social Responsibility is a waste of money. It’s bad marketing and doesn’t help anyone.”
He was absolutely right about CSR as currently practised.
He was absolutely wrong about how CSR should serve companies and communities.
Why is 99 per cent of CSR wasted money?
Because it does nobody any sustainable good.
What does a company get from traditional CSR? From giving away stuff? Building a village
school in the mountains or planting a bunch of seedlings?
A photo opportunity.
A paragraph on the CSR page of the company website.
A day in the country for company volunteers.
Traditional CSR is like an addiction – as soon as the buzz is gone, you need another fix, and
another and another.
And each new fix has to be bigger, better.
Just maintaining the habit, the old programmes, is not enough.
It does not attract the press – it is yesterday’s story.
It does not look good on the CSR page. Who wants a CSR page that reads: “We did more of the same old same old again?”
If CSR is about public relations and marketing, about establishing the quality of the company
in the eyes of the public and building brand loyalty and good will, then what kind of marketing is this?
Would you pay for it?
No – and to be honest few Thai companies do. As my banker friend said: “Bad marketing.
Waste of money.”
Doesn’t help anybody?
If companies get little return from CSR and if maintaining existing CSR projects
reduces even this, then how can CSR projects be sustainable?
And from the point of view of a community, what is the value of a school that becomes an empty
building when a company’s CSR focus moves on?
What’s the value of a reforestation project that burns six months after being planted?
Does CSR have to fail companies and communities?
No again – but if CSR is going to achieve its transformative potential we must entirely
Companies need to cease to think of CSR as charity.
They need to cease to think that they must apologise to communities for their profits. They need to understand that they are part of the community – the dynamic part. They drive communities forward.
Poor communities are poor not because of business, but because there is no business.
If companies want to be good citizens, if they want to exercise corporate social responsibility, they need to be invested in communities.
What does this mean from a practical point of view?
CSR needs to move from corporate philanthropy and governance and all of the soft, peripheral
parts of the company to the heart of the company – business development.
What do forward-looking companies focus on? Supply (how much, efficiency of access, future
security); cost reduction (production, distribution, waste disposal, human capital, access to trained manpower); demand (opening new markets); and customers (brand image, loyalty, good will).
And here is where forward-looking companies invest, because investments here are investments
in future profitability.
This is also where companies should be conducting CSR, CSR that is investment in their own
futures and in the futures of communities.
Because investments of this sort actually make companies the engines of community development.
Don’t build a random school. Build a training facility to train the workers you cannot hire
on the open market.
Don’t randomly plant seedlings, organise a training programme around lowwater consumption agriculture and secure supply into the increasingly uncertain future.
What is in this for communities?
Communities do not want stuff. Stuff is what you buy when you have money, whether it be
healthcare or education.
Communities want investment, assets that produce value over the long-term that the community
can then spend.
And what investments do communities want?
Meaningful training in skills that lead to high-quality jobs with a future; quality jobs that embody human capital investment and so will earn well into the future; access to markets, easy, low-cost entry into quality supply-chains, not dead-end access to low value staples markets.
And what characterises all of the investments communities want? They are profit-making
operations because companies do not walk away from profit making operations like they
walk away from charity.
Not a bit.
What good is useless? Used up? Empty? Abandoned?
Communities need training for young people so that they have a future in Thailand’s growing
Communities need quality jobs at home that change the terms of trade between rural village and
Communities need to be able to compete on an equal footing in the national economy.
All these good things require investment by corporate good citizens that think about their
corporate social responsibility in a fundamentally new and different way.
Yes, CSR can be a game changer, but to live up to its potential CSR in Thailand has a
long way to go.