by Zhou Weidong
"Made in China" is an unstoppable reality that's permeated every industry across the globe. Yet compared to Western countries, Chinese companies have developed rapidly and recently under very different social and economic conditions.

In modern Western countries, the emergence of a corporate social responsibility (CSR) movement did not rely solely on the enlightened self interest of corporations. It required individual citizens and civil society organizations to take an active and participatory role in pushing the agenda.

China, however, lacks a strong voice from its citizens and civil society; so under these conditions, is it fair to ask whether CSR works in China? The answer to this question is an unequivocal "yes," but how and in what forms will continue to be shaped by recent history in ways that also inform us about what to expect next.

The Introduction: CSR 101 (1996-2000)
During the mid-1990s, Chinese exposure to CSR came from those multinational corporations mainly in the consumer goods and retail sectors that began auditing Chinese factories. Chinese enterprises passively accepted some of these foreign CSR requirements. At this time, the government, public, media and domestic Chinese enterprises had little exposure to the topic. To many Chinese, CSR was a completely new idea. Discussion of CSR seldom was seen in newspapers or in online discussions.

The Wait-and-See Years (2000-2004)
As the novelty of these new demands wore off, Chinese academics, international organizations and NGOs worked to further explore and introduce the concept of CSR to China.

Chinese suppliers felt increasingly burdened by excessive and often duplicative auditing efforts and demands. Of greatest importance, several government departments began to pay closer attention to CSR. Their overriding concern was that international organizations and multinational corporations might seek to link trade and labor conditions. Accordingly, groups such as the Ministry of Labor, the Ministry of Commerce, and the Chinese Enterprise Confederation (CEC) all created CSR investigation committees. They were wary of how CSR was being promoted in China, and some government departments were especially concerned that improving CSR practices would increase the cost of exports.

In spite of these misgivings, the government chose to take a wait-and-see approach towards CSR, neither completely accepting CSR nor rejecting it outright.

Engagement (2004-Today)
As more Chinese government departments, business associations and trade groups conducted their own research on CSR, interest in it broadened beyond export processing companies to include domestic-facing, state-owned enterprises (SOEs).

China's attitude towards CSR has also shifted from a passive approach (i.e. fearing economic sanctions and trade barriers) to an active and participatory approach. Now the Chinese government is playing this role and is beginning to see it as a way to improve Chinese corporate competitiveness instead of just being a topic pushed upon China by others.

What to Expect Next
Based on China's short history with modern CSR, there are some trends worth noting that will likely impact all businesses in the years ahead:

Changing Government Role - Instead of trying to control things centrally, the central government will increasingly focus on creating the environment and control mechanisms that allow for growth, social harmony and environmental protection. Provincial governments will be encouraged to take the lead – responding to frameworks and policies from Beijing, while focusing on attracting regional foreign investment, improving human resources and working conditions, and stewarding the natural environment.

Civil Society Development - Civil society organizations will continue establishing themselves as independent organizations that represent a diverse range of community viewpoints and needs. Local Chinese NGOs, through collaboration and interaction with international NGOs, will increase their abilities to educate and impact Chinese citizens, corporations and policymakers on these issues. Likewise, international NGOs, through their collaboration with local Chinese groups, will learn how to adapt their practices to constructively work within the Chinese social, economic and political contexts.

Growing Media Coverage - With more government support for the idea of CSR, the Chinese media also is increasing its reporting on CSR topics. Multiple publications are now reporting on CSR. Last year several reporters in Southern China were sent on a study tour to learn more about how CSR is discussed in the UK. Upon returning, articles began appearing in newspapers to promote the topic. Moreover, there are now a handful of Chinese language websites devoted to CSR in China (such as www.syntao.com, www.csc9000.org.cn, and www.csr-china.net). Increased CSR reporting is a trend that will continue and the Chinese media will monitor CSR practices, uncover stories about labor and environmental challenges, and keep government departments responsive.

The Chinese Multinational Corporation - More Chinese corporations are entering the global stage as brand-name, multinational corporations. Recent examples include Lenovo, TCL, Shougang Steel, and China National Offshore Oil Corporation (CNOOC). As these corporations go through this transition, CSR can play a key role in reducing the risks they face. Ideas such as "stakeholder engagement" will go far in helping any Chinese corporation better understand how to meet and exceed new cultural, economic and political expectations as they access new markets. However, perhaps unlike other economies, in a centrally planned economy like China, if the value of CSR becomes widely accepted, China's largest SOEs may adopt these practices en masse to a very powerful effect. Time will tell.

At the beginning of Chinese economic reform in the early 1980s, Deng Xiao Ping famously stated that China would "find a path across the river by feeling its way along the river stones." I want to emphasize that China is just beginning on this CSR journey. Different sectors and different industries will try new things and many will have very ambitious goals.

There will be many naysayers and critics of these efforts. However, Western stakeholders interested in truly seeing CSR develop in China would be well-served to make sure that their reactions to Chinese CSR efforts are constructive. No one — let alone a country beginning to "find a path across the river" — knows exactly how CSR should best be implemented. It is fine and helpful to critically analyze China's CSR efforts, but one must do so understanding the unique Chinese context, and be patient and encouraging.

These are the first steps in a long journey and the challenges that lie ahead for the global CSR community are ones that we must undertake together. Helping China draw from the Western experience with CSR will endow CSR with distinct Chinese characteristics in ways that assure its very sustainability as a crucial aspect of doing business.

About the author:
Zhou Weidong is Director of Business for Social Responsibility's China office and can be reached at wzhou@bsr.org. Download the latest issue of "Leading Perspectives" from BSR.

© 2006 Business for Social Responsibility

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One Response to “Will CSR Work In China?”

1. By ms.asya alashaikh – August 11th, 2006 at 11:38 pm

   congratulations on joining the biggest movement. i have just founded the first CSR consultancy in saudi arabia. i was struck by the similarities between the general environment founder of

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