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Business / Companies

Foreign firms in China release CSR reports

By Wu Yiyao in Shanghai (China Daily) Updated: 2014-08-27 07:19

Fifty-three foreign enterprises in Shanghai collectively released for the first time their corporate social responsibility reports on Aug 12.

An enterprise's commitment and performance to fulfill its CSR is a new benchmark included in the evaluation system for Shanghai authorities to examine a foreign enterprise's comprehensive performance and contribution to the development of the city, according to Shanghai Municipal Commission of Commerce.

The collective release of the CSR reports shows foreign enterprises have been attaching more importance to the China market, said Liu Jinping, head of Shanghai Association of Enterprises with Foreign Investment.

"Releasing a global CSR report has been a conventional measure for an enterprise to show its commitment to market, community and society. However, releasing a CSR report that is devoted to the China market shows an enterprise's increasing awareness of being part of the China market," said Liu.

The CSR reports cover the foreign enterprises' involvement and investment in various aspects of the community, including environmental protection, product quality, charity contributions and social education.

On average, each of the foreign enterprises has already released three CSR reports. Some have released reports consecutively for seven years.

Experts and market insiders said an enterprise's commitment and performance to shoulder its CSR reflects the enterprise's capacity and competence in various ways.

"The fact that an enterprise can contribute a lot to the environment, employees, communities and society means that the enterprise is well-run, profit-making and has good credit to realize all these contributions. A poorly run enterprise may not have enough resources to secure employee safety and product quality, not to mention shouldering other responsibilities," said a social science professor at Fudan University.

Johnny Kwan, senior vice-president of country plat-form and functions, BASF Greater China, said that in China the chemical industry has been making efforts for sustainable development.

One measure is to leverage more resources through building up a supply chain with social responsibility awareness, involving more partners to contribute to environmental protection, charity, employee welfare and other fields.

Some other enterprises have been improving their internal mechanism to improve operational flows to realize better compliance to their CSRs.

Shanghai has been improving conditions for foreign investment, and the city has also been raising the quality of investment, said Liu.

Departments and authorities have been appealing to high-caliber enterprises in terms of social output and financial output with higher administration efficiency and fair, open, transparent conditions, according to Shang Yuying, director of Shanghai Municipal Commission of Commerce.

Encouraging enterprises with foreign investment to release their CSR reports is also a step that pushes forward enterprises' disclosure system and builds up Shanghai's credit management, said Liu.

"As an enterprise's commitment to and performance of CRS is included as a benchmark for evaluating the enterprise's performance and contribution to the city, Shanghai may have a better insight into the role of foreign enterprises in the city's economic and social development," said Liu.

More than 2,000 foreign investment projects started in the first half of 2014 in Shanghai, of which 1,016 were focused in the China (Shanghai) Pilot Free Trade Zone, about 46.7 percent of the total number, according to Shang.

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