the business case for cesr: the thai experience ms. jiranya ratchinda
DESCRIPTION
The Business Case for CESR: the Thai Experience Ms. Jiranya Ratchinda Manager, Strategic Corporate Citizenship, Kenan Institute Asia Chaiyod Bunyagidj, Ph.D. Vice President, Thailand Environment Institute June 20, 2006 Four Seasons Hotel, Bangkok. OUTLINE. Introduction to CSR - PowerPoint PPT PresentationTRANSCRIPT
The Business Case for CESR: the Thai Experience
Ms. Jiranya RatchindaManager, Strategic Corporate Citizenship, Kenan Institute Asia
Chaiyod Bunyagidj, Ph.D.Vice President, Thailand Environment Institute
June 20, 2006Four Seasons Hotel, Bangkok
OUTLINE
Introduction to CSR
4 Case Studies:• The Bangchak Petroleum Public Company Limited• Electricity Generating Public Company Limited• Pranda Jewelry Public Company Limited• Somboon Group
Q&A
2003Edited by Ryoichi YAMAMOTO (DIAMOND Co. )
Per Per second !!!second !!!
• 390,000 cubic meters of CO2 are emitted,
• 1,629 cubic meters of glaciers in Greenland melt,
• 710 tons of oxygen are decreasing from the atmosphere,
• 2,300 square meters of arable land disappear,
• 3 cattle, 7 pigs and 1,100 chickens are consumed,
the meat production sums up to 6.9 tons,
2003Edited by Ryoichi YAMAMOTO (DIAMOND Co. )
Per Per second !!!second !!!
• 5100, square meters of natural forest disappear
• 13 42. motorcars, . television are produced
• 532peoples go to MacDonald and consume more than
500 hamburgers,
• 24population increases by . persons
ddddd (2 0 0 ,0 0 0 ) ,
(Cont.(Cont.))
Annual Expenditure On Luxury Items Compared With Annual Expenditure On Luxury Items Compared With
Funding Needed To Meet Selected Basic NeedsFunding Needed To Meet Selected Basic Needs
P PPPPPPP PPPPPP PPPPPP PPPPPP Social or Social or Additional Annual Additional Annual
VolumeVolume Investment Needed to Achieve Goal Investment Needed to Achieve Goal
Makeup 18$ billion Reproductive 12$ billion
dddddd dddd ddd ddd d dd dd
ddd dddd dd 17$ billion Elimination of 19$ billion
Europe and hunger and
United States malnutrition
Perfumes 15$ billion Universal literacy 5$ billion
Ocean cruises 14$ billion ddddd dddddddd 10$ billion
water for all
ddd ddddd dd 11$ billion Immunizing every 13$ . billion
Europe child
CSRCSR Definitions: ConceptDefinitions: Concept
• World Business Council for Sustainable Development (WBCSD)
“The continuing commitment by business to behave ethically and contribute to sustainable economic development while improving the quality of life of the workforce and their families as well as of the local community and society.”
CorporateGovernance
& Ethics
People
ContributionTo Development
Environment
Corp
ora
te C
itiz
ensh
ip
Corporate Citizenship
Corp
orate
Citize
nsh
ip
CorporateGovernance
& Ethics
Local and global environmental Quality; Cleaner production processes; Eco-efficiency;Environmental Technology
Product & worker safetyLabor standardsHuman rightsEqual opportunity and access
Corporate Values and Purpose; Transparency; Accountability; Tackling corruption
Enterprise development;Community Investment;Education;Health/HIV/AIDS;Overcoming Digital Divide
ScopeScope
Developed by Suthisak Kraisornsuthasinee, Ph.D.Assistant Professor, Thammasat University
The Dawn of the CSR EraThe Dawn of the CSR Era
“85% of 140 Chief Executives of U.S. based MNCs believe that sustainable development will be even more important to their business model in five years than it is today.”Recent Survey administered byRecent Survey administered by
PricewaterhouseCoopersPricewaterhouseCoopers
Drivers of CSRDrivers of CSR
Shrinking role of government Demands for greater disclosure Increased customer interest Growing investor pressure Competitive labor markets Suppliers relations
Benefits of CSR…Benefits of CSR…
Increased sales and market share. Strengthened brand positioning. Enhanced corporate image and clout. Increased ability to attract, motivate,
and retain employees. Decreased operating costs. Increased appeal to investors and
financial analysts.
……and Challengesand Challenges
Choosing a social issue. Selecting an initiative to address the issue. Developing and implementing program plans. Evaluation and Reporting.
THE BANGCHAK PETROLEUM PUBLIC COMPANY LIMITED
A member of the Thailand Business Council
for Sustainable Development
THE BANGCHAK PETROLEUM PUBLIC COMPANY LIMITED
BACKGROUND
ESTABLISHED:
VOLUME:
STAFF:
1984
757 (as of December 2005)
80,000 mil. Baht
THE BANGCHAK PETROLEUM PUBLIC COMPANY LIMITED
SCOPE OF BUSINESS
Refined oil sales
Oil refinery management;capacity of 120,000 barrels per day
Consumer goods retail
Integrated petroleum company (production and marketing)
>>
Bangchak Goal:
To be a company that helps develop a better quality of life for all Thais
The company recognizes itself as a large petroleum operation - safeguarding environment and societyis a priority consideration.
THE BANGCHAK PETROLEUM PUBLIC COMPANY LIMITED
RATIONALE FOR CESR
THE BANGCHAK PETROLEUM PUBLIC COMPANY LIMITED
BANGCHAK CULTURE
The sustainable development of business, the environment and society.
THE BANGCHAK PETROLEUM PUBLIC COMPANY LIMITED
Environmental Focus
• Green products: Gasohol, Bio-Diesel• Environmental Management Accounting
CESR HIGHLIGHTED PROGRAMS
THE BANGCHAK PETROLEUM PUBLIC COMPANY LIMITED
• Bangchak community gas stations• Community enterprises
Socio-economic Development
>>
CESR HIGHLIGHTED PROGRAMS
THE BANGCHAK PETROLEUM PUBLIC COMPANY LIMITED
LESSONS LEARNED
Barriers
- Development of organizational culture
Countermeasures
- Management commitment and support.
Key Success Factors
- Management’s leadership- Organizational culture
10
86
420
200520042003u
nit
(m
il. B
aht)
year
Budget for Social Activities
THE BANGCHAK PETROLEUM PUBLIC COMPANY LIMITED
AWARDS & RECOGNITIONS
o Board of the Year Award for Exemplary Practices - 2004/ 2005
o Best Corporate Governance Report Award – 2005
o Most Creative Issue Award - 2004
o TIS 18001-1999 and OHSAS 18001-1999 Occupational Health and Safety Management System
o ISO 14001-Petroleum Refining Certification, 1997
THE BANGCHAK PETROLEUM PUBLIC COMPANY LIMITED
FUTURE CESR ACTIVITIES
Coordinating community networks
Expand business opportunities for communities
THE ELECTRICITY GENERATINGPUBLIC COMPANY LIMITED
A member of the Thailand Business Council
for Sustainable Development
ESTABLISHED
VOLUME
STAFF
1992
107 (as of December 2005)
16,000 mil. Baht
THE ELECTRICITY GENERATING PUBLIC COMPANY LIMITED
BACKGROUND
Produce electricity and supply to EGAT under long-term power purchase agreement.
THE ELECTRICITY GENERATING PUBLIC COMPANY LIMITED
SCOPE OF BUSINESS
Corporate belief that success is intimately linked with the qualitative growth of Thai society
Vision and policies designed to support activities
Corporate contributions to society and communities in which they operate
THE ELECTRICITY GENERATING PUBLIC COMPANY LIMITED
RATIONALE FOR CESR
Alleviating environmental impacts and undertaking review and evaluation of performance;
Encouraging employee responsibility for a clean environment;
Communicating with the public and sharing experience with other agencies on industrial performance, knowledge and operating practices.
THE ELECTRICITY GENERATING PUBLIC COMPANY LIMITED
POLICY STATEMENT ON CSR
THE ELECTRICITY GENERATING PUBLIC COMPANY LIMITED
CESR HIGHLIGHTED PROGRAMS
Green Energy
Implementation of ISO 14001
Promotion of Alternative Energy
Energy Efficient Building Program
Environmental Focus
Education
- Green library
- Learning facilities and equipment for schools
THE ELECTRICITY GENERATING PUBLIC COMPANY LIMITED
CESR HIGHLIGHTED PROGRAMS
Social Development
- EGCO’s Group Environment Conservation Camp - Thai Forest Conservation Youth Camp
Youth
THE ELECTRICITY GENERATING PUBLIC COMPANY LIMITED
LESSONS LEARNED
Barriers
- Lack of employee support
Countermeasures
-Raise awareness of employees -Participation as indicator for performance appraisal- Recognition of employee contribution to society and environment.
Key Success Factors
- Top-down (Board’s & Company’s Policy)- Achievement Incentives - Availability of Budget
THE ELECTRICITY GENERATING PUBLIC COMPANY LIMITED
AWARDS & RECOGNITIONS
Best Corporate Governance Report Award
Top ten listed company in terms of Good Corporate Governance
2001 Best Practices On Corporate Governance
The Good -Very Good Corporate Governance Company
Thailand Energy Awards for "Energy Efficient Building
Natural Resource Conservation Award
Continue implementation of projects; and
Expand activities to new plant sites
Plans for New projects
Sustainable approach to prevent flashfloods and landslides
Environmental program at Nam Theun II project in Lao PDR
Green Classrooms
THE ELECTRICITY GENERATING PUBLIC COMPANY LIMITED
FUTURE CESR ACTIVITIES
PRANDA JEWELRYPUBLIC COMPANY LIMITED
PRANDA JEWELRY PUBLIC COMPANY LIMITED
BACKGROUND
Established in 1973 as a jewelry exporter
Started production base 11 years later
Listed company on the Stock Exchange of Thailand in 1990
Operates 5 factories in 4 countries – Vietnam, Indonesia, China and Thailand
Signed the Global Compact Emphasis on Human Rights, Labor Standards and Environment
Volume: 4,000,000 pieces of jewelry each year
Staff: 3,500
PRANDA JEWELRY PUBLIC COMPANY LIMITED
SCOPE OF BUSINESS
Pranda Group of companies comprises of:
9 affiliated companies 2 Joint Ventures
Engages in design, manufacturing, domestic and export markets and retail.
PRANDA JEWELRY PUBLIC COMPANY LIMITED
RATIONALE FOR CESR
Issues related to business Employee retention is key to business
success Require employee honesty and sense of
ownership
CEO’s Vision
Vision: Caring for employee benefit and welfare Sharing wellbeing with stakeholders
PRANDA JEWELRY PUBLIC COMPANY LIMITED
POLICY
Employee Policy:
Treat all employees equally and fairly with proper remuneration under a pleasant and safe working environment.
Society and Environment Policy:
Take responsibility for community environment through participation in activities and events; and strictly comply with related rules and regulations.
PRANDA JEWELRY PUBLIC COMPANY LIMITED
CESR HIGHLIGHTED PROGRAMS
Employees’ standard of living
Recognize value of personnel.
Emphasis on staff satisfaction (income, security, welfare and
career path).
Create environment for employee participation
PRANDA JEWELRY PUBLIC COMPANY LIMITED
CESR HIGHLIGHTED PROGRAMS
Bilateral Education Project
Cooperation with Kanchanapisek Royal Goldsmith College-2000
Strategically link community program with core business Curriculum for Vocational Level Diploma and Higher Vocational
Level Diploma Budget allocation (from year 2000-2006) ~ 31 Million Baht Scholarships No. of students: 123 graduated,
302 currently studying
PRANDA JEWELRY PUBLIC COMPANY LIMITED
LESSONS LEARNED
Key Success Factors
Skilled labor in design and manufacturing Employees’ honesty and efficiency
Cost and Benefits
Enhanced employee morale Build skilled labor for jewelry industry Market access (International Labor Standards) Brand Value and Reputation Community involvement with underprivileged youth
PRANDA JEWELRY PUBLIC COMPANY LIMITED
AWARDS & RECOGNITION
2004: Best Exporter
1999: Thailand’s Brand
1998: Best Marketing of New Gold Product and Best Gold Visual Merchandising in Asia Pacific
1996: Best Own Design Exporter
1995: Best Exporter
PRANDA JEWELRY PUBLIC COMPANY LIMITED
FUTURE CESR ACTIVITIES
Strategic focus on Human Resource Development and Welfare
Link communities’ needs with company’s core business
Continue philanthropic and social programs
BACKGROUND
SOMBOON GROUP
Established over 60 years ago as a automobile parts distributor
Expanded to automobile parts manufacturing
In 1996 received technological know-how from Japanese partners
Listed on the Stock Exchange of Thailand in 2005
Obtained QS 9000 and ISO 140001 certification
SCOPE OF BUSINESS
SOMBOON GROUP
Somboon Group of company has 1700+ staff.
The group consists of 3 companies located in the same area.
1. Somboon Advance Technology Public Company Limited (SAT)
2. Somboon Malleable Iron Industrial Company Limited (SBM)
3. Bangkok Spring Industrial Company Limited (BSK)
RATIONALE FOR CESR
SOMBOON GROUP
Vision:
To be an employer of choice by improving quality of life for employees and their families. The company strives to be a neighbor of choice for surrounding communities by expanding activities to cover communities’ social and environmental aspects.
Issue related to business:
As the company is a heavy industrial plant, it is inevitable that there are environmental impacts. The company focuses its CESR programs on reducing air, sound and chemical pollutions in and around the surrounding communities
POLICY STATEMENT ON CSR
SOMBOON GROUP
2003-2007 Corporate Mission:
“To be an important part in Supply Chain to satisfy customers, and encourage employees to be environmentally and socially responsible.”
Employee Policy:
“The company intends to improve employees’ standard of living, including their morale and physical and
mental health, by paying suitable wages; and engage them in the company’s community programs to
enhance their awareness of social responsibility and maintain business ethics.”
CESR HIGHLIGHTED PROGRAMS
SOMBOON GROUP
Environmental Aspects
Center of environmental community learning Energy saving program Green School program – Integrated environment and
community concept
Social and Community Aspect
Drug-free company, cigarette- and alcohol-free program, Good food for employees for better health program External Community Involvement Program
CESR HIGHLIGHTED PROGRAMS
SOMBOON GROUP
Tools / Concepts
Pursuing CESR activities through Stakeholder Engagement
Engage all stakeholders including employee, supplier, customer, community and partner in CESR programs
LESSONS LEARNED
SOMBOON GROUP
Challenges
Communication with local communities at initial stages Management buy-in and employee participation
Cost and Benefit
Obtain License to Operate Increased productivity Gaining a good reputation Enhanced employee morale Lower spending on community/ social projects through employee
volunteer program and in-kind contribution from partners only around 200,000 baht in cash and estimate cost of 403,500 baht on Employee Volunteer in year 2005
AWARDS & RECOGNITIONS
SOMBOON GROUP
QS 9000 Certificate
ISO 14000 Certificate
ISO/TS 16949 Certificate
2003: Quality Improvement Award (Zero Claim) and Quality Excellence
FUTURE CESR ACTIVITIES
SOMBOON GROUP
Model Employee Volunteer Programs
1. Donation2. Community Involvement
Strategic program development on public issues
1. The Sixtieth Anniversary Celebrations for His Majesty's Accession
2. Livable community – restoring school, religious places and public infrastructure in local communities
CONTACTADDRESSMs. Jiranya Ratchinda
Manager – Strategic Corporate CitizenshipHuman Capacity Development Division
KENAN INSTITUTE ASIAQueen Sirikit National Convention Center2nd Floor, Zone D, Room 201/260 New Ratchadapisek Road,Klongtoey, Bangkok 10110
Tel: 0-2229-3231-2 ext. 232Fax: 0-2229-3130E-mail: [email protected]: www.kiasia.org
Chaiyod Bunyagidj, Ph.D.Vice President
THAILAND ENVIRONMENT INSTITUTE16/151 Muang Thong Thani, Bond Street,Bangpood, Pakkred,Nonthaburi 11120
Tel: 0-2503-3333 ext. 405Fax: 0-2504-4826E-mail: [email protected] Website: www.tei.or.th
Q & A