Companies and being socially responsible

While reading through some posts on Kuensel and elsewhere I have come across people calling companies in Bhutan to be socially responsible. Last month, the National Council members urged the banks 'that there should be some corporate social responsibility from the financial institutions towards rural development' (Kuensel article). These are encouraging signs and I am pleased that a section of the Bhutanese now demand responsible behaviour from our companies. It is important that we impress upon and remind the companies that their activities have an impact, environmentally and socially, on the communities in which they operate in.

I don't know how companies in Bhutan take Corporate Social Responsibility (CSR) . CSR is taking a wholesome view of the activities a company engages in and behaving ethically, legally and economically. There are several good reasons why companies should engage in CSR;

• It enhances their corporate reputation within the society. It is a branding tool.
• It is also a strategic tool to preempt backlash from your customers, investors, business partners and the community. It provides competitive advantage to the firm.
  
• It is morally and ethically right to do.
  

CSR encompasses many activities and can mean different things to different entities. There isn't a single best way to do CSR. Companies often end up doing many things .Use the following framework as a guide to develop your company's approach to CSR:

• Understand all the activities of your company.
• Recognise all the different stakeholders (suppliers, employees, investors, regulators, community, customers, business partners and even the media).
• Develop a comprehensive CSR policy and translate it into measurable activities. Communicate the CSR policy and intent throughout your company. Get people on board.

It is often difficult to prioritise the target stakeholders. The following approach can help to focus.

• First, get right with the internal and the important stakeholders (Read this to understand stakeholder analysis) - Good employment practices and providing good working conditions to the employees; Respecting human rights; Good corporate governance; Good environmental practices; Ethical behaviour.
• Focus on the external stakeholders - Build a school; support an NGO; donate money to causes; sponsor the film awards; volunteer;
• Finally if you are that big, you can go global with CSR activities.

Companies in Bhutan cannot neglect CSR. As more people get educated and as our markets open up, it might mean whether a company does well or not.

(image from www.tomfishburne.com)