Myanmar demands socially responsible practices from both local and international companies
There is a growing consensus among foreign investors about making corporate social responsibility (CSR) a strategic tool to enter the market. That would be the right approach given that Myanmar authorities are pushing all companies operating in the country to share their benefits with broad-based society and environment.
“You must see CSR within the context of national reforms for the private sector development. In promoting private sector development, the Myanmar business community must be socially responsible. Myanmar is going beyond CSR,” Professor Aung Tun Thet, economic adviser to the President and member of the Myanmar Investment Commission (MIC), said.
At “Smart Myanmar CSR Forum” late last month, Aung Tun Thet insisted that CSR must be a part of the business strategy of all the companies.
“We are now moving towards CSR 2.0. CSR must be built-in, not bolt-on. We need to have credible partners. Companies should find credible partners. NGOs [non-governmental organisations] are very important partners in our journey towards CSR,” he said.
Pisanu Suvanajata, Thailand’s ambassador to Myanmar, said in a recent interview that it is a must for all Thai companies to come up with the right strategies from the beginning. The Royal Thai Embassy in Myanmar is also launching some projects, in which Thai companies can participate. He noted the good relationship between the embassy and Myanmar authorities, and said participation would mean a rubber stamp for those Thai companies who want to do business in Myanmar.
“Don’t wait till you make profits. It doesn’t work like that here. We need to build trust,” he said.
He believes companies should create more opportunities for the younger generation.
“Changing is part of survival. It is a part of life. We need to forget about the sayagyis [old brains in a firm who like the original way] because sayagyis cannot follow. Let them retire. You need to be very straight about them,” he said.
According to the World Bank, in 2012 about 10.1 per cent of Myanmar’s labour force aged 15-24 who are available for and seeking employment are unemployed.
Children in remote areas are also witnessing other hardships. Many are living without birth certificates, which bar them from public health services and basic education. According to the United Nations, around 1.6 million children, or three out of 10 aged under five years, remain unregistered in Myanmar.
Foreign companies are now focusing their strategies in these areas.
Procter & Gamble, a global consumer products manufacturer, earlier this year announced that over the next two years, in cooperation with US Agency for International Development (USAID) it would jointly invest at least US$2 million on health projects aimed at providing clean drinking water through provision of P&G Purifier of Water packets; promote more hygienic behaviour; and build capacity to deliver improved health services to mothers and children.
In addition, for every purchase of one pack of “Pampers” diapers, one dose of vaccines would be distributed in 10 countries, including Myanmar, to prevent maternal and neonatal tetanus among newborn babies.
Prior to its return to Myanmar after a 60-year hiatus, Coca-Cola, through its charitable giving arm – Coca-Cola Foundation – announced a grant of US$3 million to empower nearly 25,000 Myanmar women focusing on financial literacy, entrepreneurship and business management. The cooperation with Pact, a non-government organisation, started in 2012 even as Coca-Cola was awaiting approval from the US government for investment. It was a year before the American company started the local bottling activity.
Other companies are moving in the same direction.
Education, health and community development are also the focus areas of PTT Exploration and Production Plc (PTTEP), which has been operating in Myanmar for 25 years.
The exploration and production firm has awarded 10 scholarships to poor and academically strong high-school students to pursue studies in medicine, engineering, education, nursing and midwifery. Another 70 scholarships have been given for studies in industrial courses at IRPC Institute of Technology in Thailand’s Rayong province. The parasite-free schools initiative was launched at 2 of 28 villages in the Kanbauk area, while the company provided financial assistance for the construction of new school buildings as well as the renovation of Kaleiaung Hospital.
PTTEP president and chief executive officer Tevin Vongvanich said the company pays close attention to implementing its CSR activities in Myanmar, along with a determination to build the country’s energy security.
“Over the last several years, our socio-economic unit has continuously worked to improve the living standards of the people of Myanmar while encouraging public participation both within and outside our operational areas. Numerous CSR and socio-economic projects continue to yield positive results. I’m confident that our strong cooperation efforts, and our friendship, will empower us to push through future obstacles and thrive sustainably together with the people of Myanmar,” Tevin said.
While the $400 million cement factory is under construction, Thailand’s Siam Cement Group late last year awarded scholarships to 200 high-school students in Yangon region and Mon state.
“Education is essential to ensuring that children will grow up to form a new generation of Asean citizens who are ethical and knowledgeable. I believe that they [young scholars who received the grants] deserve a bright future and hope that they will pursue higher education and use their talents to support their families and communities,” said Chana Poomee, country director of SCG Myanmar.
Thomas Thomas, chief executive officer of the Asean CSR Network, believes education is the priority area, aside from women empowerment and the environment.
“How we do CSR is actually very important. Some businesses actually apply international labour standards and responsible business ethics to protect their reputation. For example, if they do not allow those under [the age of] 16 to apply for the job, what will happen to those under 16?” he questioned. “In Myanmar, the education system cannot cope with such a major influx of children. Children and their families need to eat. And they need to earn their own living,” he said.
UN Global Compact
They are moving in the right direction as the authorities are demanding more from them. All foreign companies are now requested to join the UN Global Compact, the initiative that calls companies globally to adopt 10 universal principles embracing human rights, labour, environment and anti-corruption.
“We are now moving towards the largest CSR initiative in the world, which is the UN Global Compact,” said MIC’s Aung Tun Thet. “For every [investment proposal] submission to the MIC, we have requested CSR. Now we are also requesting applications to UN Global Compact. So all foreign companies are now requested to embrace the principles.”
A similar request is being made to local companies as well.
The professor urged the local firms to join the global compact, as it is a national movement the government has been very closely working with the Union of Myanmar Chambers of Commerce and Industry UMFCCI). At present, more than 100 local companies have been the members of the initiative.
“We are aiming to have 1,000 local firms registered to apply for the UN Global Compact by the end of this year. This is the challenge. If we achieve this, we will be No 1 in the world,” said the adviser, who wanted to beat France and Spain from where 900 and 800 companies are now participating with the UN on this initiative.
According to Khine Khine Nwe, UMFCCI’s joint secretary-general and MIC member, a UNGC Summit will be organised in Yangon next month and the chamber’s CSR unit is ready to help local companies with the registration.
She advised business people not to think of CSR as a cost. She underscored the importance of creating a harmonious workplace, building trust and team spirit.
“There are many CSR activities where you do not need to spend money. But you can do a lot of those things in your workplace. Employing the disabled is an example. People might think if you employ the disabled, there will be less productivity. No. It is very inspirational. They comprise 3 per cent of the workforce in my factory. They want to work with ordinary workers. They try and concentrate more because they see other people around them,” she said.
Steve Marshall, International Labour Organisation’s liaison officer in Myanmar, echoed Khine Khine New’s view.
“CSR is not the cost. It is actually a way of becoming more profitable. I think if we see it as a cost, then we will lose,” he said.
In a country where inequality and human rights violation is an acute challenge, CSR is not yet a buzzword among local companies.
Aung Tun Thet had to visit various towns across the country, like Pyay, Pakhoukku, and Myingyan, and those in Kachin State, in order to raise awareness of CSR. He believes all the awareness campaigns were successful as they managed to attract the interest of local business communities.
“For us, CSR is a way to advance social innovation in all business functions. We need to communicate impacts. Whatever we do, the outcomes should be measured in terms of the impacts and society.
“We need all the stakeholder groups, not just the business community, not just the government, not just the international donors, we need everyone. We need the community and media to get involved,” he said.
“We need to come up with innovative solutions. We need to have closer cooperation with all stakeholders. CSR is about doing well and doing good. For all of you, this is a very simple message. We must do well as a business community. But at the same time, we must do good. CSR is nothing but doing good and doing well,” he concluded.
Win Aung, President of the UMFCCI, said that the chamber remained committed to the promotion of CSR in the interest of the people and the economy.
“CSR can facilitate and leverage regional progress through generating better employment opportunities and more prosperous livelihoods for both urban and rural populations and contribute to the progress of the education and health sectors,” he said.
New economic era
Win Aung added that local people’s awareness and appropriate practice of the concept of CSR is of utmost importance for the success of the strategy to establish a new era of economic development and prosperous livelihood.
Deputy Minister for Commerce Pwint San said that CSR is a strategic tool for business management and continuous improvement of local businesses.
“CSR is not just charity but has much more meaning. CSR is generally a way to achieve balance between the 3Ps – people for society, planet for environment, and profit for the economy,” he said.
He said many Myanmar companies have also conducted CSR activities. In this regard, some international and non-international governmental organisations are reviewing the implementation of CSR in Myanmar companies and international organisations that have been investing in the country.
The deputy minister added that most of the Myanmar business firms are family business types and their management practices are traditional ways. They have weaknesses in capital, poor market assess, lack of technical knowhow and skilful staff. But nowadays, thanks to the changes of economic patterns in the world, private businesses are facing the same challenges, issues, and problems as other areas of the world.
He urged local firms to carry out CSR activities that meet international standards for their own benefits as well as for the sake of the country and citizens.
“It is very clear that it’s not possible to adopt traditional ways in everything. It is necessary to carry things out in accordance with international standards and procedures in order to achieve international norms,” he said.
Source: The Nation