②fri_ikuta 130228（english）

7/29/2019 FRI_Ikuta 130228 English

1/16

Copyright 2013 FUJITSU RESEARCH INSTITUTE

From CSR to IB: An Overview on

Japanese Companies Situationand Challenges

February 28 2013Takafumi Ikuta

Senior Research Fellow, Economic Research Center,

Fujitsu Research Institute (FRI)


2/16

Issue

Copyright 2013 FUJITSU RESEARCH INSTITUTE1

Building a business model which solves social problems is

useful for BOP market development.

Japanese companies should use CSR activities strategically.

CSRInclusive Business

Strategic CSR

Corp

orateprofit

General business

modelSustainable business

model

Social value

Minimum profit

Social contribution

activities

CSR activities


3/16

0

1

2

3

4

5

6

90 91 92 93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10 11

Keidanren Social Contribution Activities (SCA) Survey 431 companies

FY2011 SCA total expenditure JPY 246 billionSCA expenditure per company JPY 571 million

Average % of current profits 2.46%

Steady social contribution activities


Source: Japan Keidanren

0

1

2

3

4

5

90 91 92 93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10 11

SCA expenditure per company Average % of current profits

Hundred million

FY FY

Expenditure for

earthquake

Earthquake

expenditure incl.


4/16

0

1

2

3

4

5

6

2004 05 06 07 08 09 10 11

Keidanren SCA Survey

Contents of SCA expenditure per company

Donation based SCA


FY

Support for

disaster area

Donations

Self-planning

program

Hundred million

Source: Japan Keidanren


5/16

Detailed investigation of Keidanrens SCA survey (FRI; 2009)

348 companies responded. 396 responses from 194 companiescorresponded to international SCA.

Overseas SCA diverging from core business


Fact : Mainly BOP market Fact: Mainly donations

98%

2%

Developing/Emerging

countries

Developed

countries

50%

28%

22%

Including

donations(other-planned)

Other than

donations

Fact : Only 7 cases (2%) of SCA were strongly related to corebusiness

Including

donations

(self-planned)

Source: FRI, based on Keidanren materials


6/16

Toyo Keizai Inc.s CSR Kigyou Souran (Companies Complete Guide)

Involvement with BOP business


4.55.9

5.5

6.6

0

5

10

15

20

2011 2012

4.96.4

6.9

8.7

0

5

10

15

20

2011 2012

4.05.3

3.8

4.2

0

5

10

15

20

2011 2012

otal20111,117

20121,128

Manufactures2011591

2012598

Non-manufactures2011526

2012530

Planning

Involved Source: FRI based on Toyo Keizai Inc.s CSR Companies Complete Guide


7/16

Position of BOP business


2.3 3.1

18.5

22.5

0

5

10

15

20

25

30

35

2011 2012

2.0 2.5

23.9

27.8

0

5

10

15

20

25

30

35

2011 2012

2.7 3.8

12.5

16.6

0

5

10

15

20

25

30

35

2011 2012

Total20111,117

20121,128

Manufactures2011591

2012598

Non-manufactures2011526

2012530

Future business opportunity

Ongoing businessSource: FRI based on Toyo Keizai Inc.s CSR Companies Complete Guide

Toyo Keizai Inc.s CSR Kigyou Souran (Companies Complete Guide)


8/16

Recognition of Japanese Companies(2012)


Involvement

Involved Planning Not yet Total

Position

Ongoing

business 2.7% 0.0% 0.4% 3.1%Future business

opportunity 2.3% 5.1% 15.1% 22.5%Social contribution/

No answer/ Others 0.9% 1.4% 72.1% 74.4%

Total 5.9% 6.6% 87.6% 100.0%

Matrix of 2012 data

10% of total is involved or planning its BOP market activities

with consideration of business developmentSource: FRI based on Toyo Keizai Inc.s CSR Companies Complete Guide


9/16

Present situation of Japanese companies

1. Corporate interest in BOP business or IB is increasing

2. Most companies do not use their CSR activities

strategically in developing/emerging countries

Japanese companies should ask themselves:

1. Am I seriously thinking of developing business in BOP

markets?

2. Can I change my thinking that CSR activitiesSCA?

So far


Existing gap between SCA and BOP market development

With change in thinking and management reform


10/16

Changing mindset for inclusive business


Avoid to consider with focus only on business for

BOP market

Aim to develop a new market (with high BOP ratio)

and consider a business model including social

problem solution

Try to check if its SCA and/or CSR activities could

use effectively for its new market development


11/16

Executing strategic CSR to open BOP markets


Dealing withwhole company

Dealing withproject base

Reconsider BOP business

Develop products which address socialproblem-solution needs

Fit with management resources and CSR policy

Reconsider CSR activities

Match between goals, content, region

Social, economic evaluation of results

Establish internal management systems

Corporate policy which clearly connects CSRand core business

Close ties between CSR and overseas

business divisions

Introduce CSR evaluation index and PDCA

cycle


12/16

Activity region and business

Reconsidering CSR activities


Manufacturing

base

Materials

supply

Market

No direct relation

Goals

Giving back, philanthropy

Risk management

Reputation, branding

Business development

Employee satisfaction

Activity and

core business

Related

Not

related

Existingbusiness

New

business

Making goals clear is necessary

Related

Confirm match between activity goals, content, and region


13/16

Activity should connect to core business and region

CSR activities for business development


Rethink the need for activities whose connection to core

business cant be explained

Activity region and business

Manufacturingbase

Materials

supply

Market

No direct relation

Goals

Giving back, philanthropy

Risk management




Activity and

core business

Related

Not

related

Existingbusiness

Newbusiness

Related


14/16

Start out with goal of social contribution and search forfuture business opportunities

Considering CSR activities as entrance


Visualization of activity results in terms of business and

social benefits

Communication strategy fitting into goals


Giving back/philanthropy

Risk management



Socialc

ontribution

g

oals

Considering business model

Grasp social needs

Product development

Marketing

Market accessValue chain

Dissemination

Personnel training

Procuring capital

Collecting capital etc.

Partnership

Local partner

Government

Intl support agency

Research agencyetc.


15/16

CSR activities using core business

IB development by strategic CSR


Transition to business development from CSR activities

Example of creating market to deal with social needs of BOP Meeting social needsnutrient enriched foods, water purification tablets,

electricity generator, cooking appliances

Low price and small sized retailfoodcomodity, health & sanitation, etc.

Job creation and industry developmentusing regional resource and labor force

Infrastructure-buildingenergy, communications, financial, etc.

Providing free in-houseproducts/services

Products/servicesrecognition

Improved image

Increased businessopportunities in future

Develop products/

services which meet

social needs

Product/service

recognition

Open sales channels

Increase market for

own products/services


16/16C i ht 2010 FUJITSU RESEARCH INSTITUTE15

②fri_ikuta 130228（english）

Documents