All posts by Emily D'Ath

Emily is an experienced project manager with practical and research experience in sustainable development and corporate social responsibility. She has worked in Australia, China, Laos, Thailand and Malaysia. Emily currently lives and works in China. The opinions Emily expresses on this blog are her own and do not reflect those of her employers or clients

China’s moth-eaten social safety net: who will catch the poorest of the poor? Not corporations.

China is, without a doubt, on a fast track to ‘development’ with an astonishing US$3.2 trillion in foreign reserves. But inequality, particularly rural and urban, is extreme with an estimated 150 million people living below the United Nations poverty line of less than $US1 a day. China’s growing wealth has resulted in multiple international aid agencies (including Australia’s Agency for International Development) pulling out of China. So, who is going to pick up the slack and help support 150 million people living in extreme poverty?

I don’t want to over exaggerate the influence that aid agencies have had on combating poverty in China. The Chinese government has done a remarkable job of lifting millions of people out of poverty and they will not stop achieving this, but 150 million people still living in extreme poverty is a huge number. As with most issues in China, it is the scale that makes the issue so significant.

Since working in CSR in China, I have noticed a further shift towards engaging corporations to contribute to NGOs who work in poverty alleviation. This concerns me for two main reasons.

  1. CSR in China is currently not mature enough to significantly contribute to poverty alleviation and is still often used as a tool to improve companies guanxi 关系 (relationship) with governments.
  2. Unless there is a shift in the way we view capitalism, corporations will never view themselves as part of a social security system.

Corporations in China, both international and domestic, will not fund NGOs or GONGOs (Government Organised Non Government Organisations) to the extent that is needed to support the poorest of the poor. This is not to say that companies do not engage in successful community investment, they do, but it is by no means at the level necessary to significantly contribute to poverty alleviation. At this stage, corporations can do more to alleviate poverty by focusing on improving their internal supply chains and employee working conditions.

International aid agencies in China have worked with (and therefore supported) domestic NGOs. Civil society in China, or the lack of it, is a real problem. Civil society, including community organisations and NGOs, has the potential to play a huge role in poverty alleviation. However, local NGOs are getting little support and now that aid agencies are leaving the situation for some is dire. I have spoken to a number of NGOs in China who are desperate to engage companies under the guise of CSR to fund their organisations. One of these NGOs was supported by an international aid agency that has now, in an official capacity, pulled out of China. It is my feeling that unless you are an international NGO or a GONGO in China, you are going to struggle to get support under the guise of Corporate Social Responsibility.

So, who will provide enough support to domestic civil society that in turn support the most disadvantaged and poor?

Well, in my opinion, it will not be the CSR departments of local and international corporations. Ultimately, the responsibility lies with the government. The Chinese government has the money but still lacks the capacity and infrastructure to develop a social safety net that will support those living in extreme poverty. The issue around the government not supporting NGOs from a political perspective is also a contributing issue. The domestic philanthropy sector is rich (and making some progress) but riddled with challenges ranging from weak laws and regulations to outlandish corruption. China may get there in the end, but between now and then, the holes in the social security system are here to stay.

This is a cross-post with Emily’s own blog.

CSR: Causing Some Reservations. A response to the Aid Blog Forum

By Emily D’Ath, Weh Yeoh & Brendan Rigby

This is a joint post in response to the first discussion for the ‘The Aid Blog Forum‘; an initiative started by J. at Tales from the Hood.

The first topic is Corporate Social Responsibility (CSR). Emily, Weh and Brendan present each of their responses to the guiding questions for this discussion. Join in!


How should we think about CSR?

Emily – Firstly, there needs to be a clear delineation between CSR and what is called ‘community investment’. Community investment is basically a more sophisticated and structured type of philanthropy. It is through community investment that most NGOs will interact with the private sector. Without delving too far into the depths of the definition debate around CSR:

CSR involves the recognition by private enterprises about the challenges the world is facing in relation to sustainability, both social and environmental. The main aim for a company engaging in CSR is to balance the interest of all stakeholders related to their core business e.g. the environment and shareholders. CSR, in my view, should be voluntary and goes beyond the law.

For an example of a company that is practicing CSR check out Marks & Spencer and their ‘Plan A: Do the Right Thing’.

We need to be clear that most NGOs in the development sector currently, or will, deal with corporate foundations or CSR departments who want to contribute money to the community. Whether or not you agree with this is a personal choice but something NGOs need to think about. Do you want to take money from a company that does not have the best ethical standards in other areas of their business?

Brendan – We need to think more broadly and inclusively about CSR. The biggest concern I have about CSR is the that fact that it largely operates within the traditional business model, but almost as a separate entity. An afterthought. Another avenue for raising a company’s profile, albeit under an altruistic banner. For CSR to evolve into a more holistic practice, we really need to unpack the underlying concept of CSR. That is, sustainability. What does sustainability mean to different actors? To business? To communities? To government? Currently, the ‘business as usual’ mantra still dominants many notions of sustainability. Sustainability has been co-opted into the business of growth, expansion, and the bottom line. However, we need to understand and enact the social, cultural, and environmental dimensions of sustainability and ensure that CSR be about future generations, not just our own.

What existing practices or ways of thinking about CSR should be stopped or change? Be specific.

Emily – CSR is not philanthropy. Particularly in Asia, CSR is still viewed in terms of simply donating money. In China, it can even involve donating money to local government officials. As mentioned previously, CSR should be systematically changing the way businesses work to become more sustainable. In an ideal world we would not have CSR departments, as sustainability would be integrated into every aspect of how a business operates.

Brendan – I agree with Emily, and would go further to say that sustainability cannot be thought of as ‘sustainability’; as this separate entity that we are required to consider. Rather, it should be so deeply embedded in our thinking and our lives that it does not need articulation. To point where business just is sustainable. Food production just is sustainable. We do not try to be sustainable, we just are sustainable.

Weh – I agree that the partnership between NGO and private enterprise is inevitable. But I think the most important part about this is thinking about expertise, and it’s important that private enterprise is able to release control of situations and rely on the expertise of NGO partners. I’m thinking about this in the context of Australian politics, where, under people such as the Opposition Leader Tony Abbott, no one is an expert anymore. A scientist disagrees with my world view on science – screw him, I’m going to discredit him. An economist thinks my direct action plan is too expensive – screw him, I’ll discredit him too!

Along these same lines is the idea that because private enterprise is funding a lot of “charitable” activity, and not government, we are now coming to the situation where we’re using a non-democratic way of deciding which of community’s problems are being solved. By comparison, when government decides which problems are to be solved, at least we have some control over that, in that we democratically elect them. However, nobody democratically elects private enterprise, so what right do they have to pick and choose which of society’s problems deserve attention? The only way to get around this problem, is again, to consider the question of expertise. In deciding which areas need the greatest attention, the expertise has to come from the community, not from the boardroom. If, and only if, private enterprise can do this, can CSR be effective. (Yet I personally doubt it).

Finally, the existence of CSR should not, I think, absolve the government of it’s responsibility to continue to fund development work. Rather, CSR should be an addition, a bonus if you like.

Brendan – Specifically, CSR and notions of sustainability have to be embedded in education. And, not just higher education, but right down to primary schooling. Sustainability is a concept that crosses boundaries and disciplines, encourages creativity and new ways of thinking. It can find its expression in art, business, economics, geography, science, history, etc. This is not a new idea, but one that needs to see greater adoption in education systems around the world. The upcoming Rio+20 would provide a great platform to push such an agenda.

What principles should guide NGO marketing and corporate relations departments as they engage with counterparts in the corporate CSR world to consider partnerships and opportunities for programs in the field?

Emily –

  • Partnerships should be mutually beneficial otherwise it can be hard to justify to both parties why they should renew or engage in ongoing support for an initiative.
  • Partnerships should be 3-5 years, to ensure both parties are committed and programs can have real medium to long-term impacts.
  • Programs need to have a strong monitoring and evaluation system in place, to ensure accountability and feasibility for both parties.
  • Do due diligence about potential partners before entering an agreement. Be clear about what your expectations are and make sure you are comfortable with a company’s expectations. Don’t assume the only reason a company wants to engage with you is for PR or marketing purposes. Private companies aren’t fundamentally immoral but amoral. In fact some of the most committed environmentalist I have met work in executive roles for private companies.

Weh –

  • At the risk of harping on about one point, expertise is the key. We need to think about what private enterprise can bring to NGOs, and money is not the only thing. We need to think outside the box about what private enterprise is good at, and then use these skills. One example I can think of is an NGO that engaged corporate types to voluntarily clean out their office, organise files, stack shelves and the like. When it came down to analysing what these people did on a day to day basis, it turned out that they were from the marketing team of their company. A far better use of resources would be to use their skills to create a marketing campaign for this NGO, as this was something that the NGO lacked experience in. I would much rather see NGOs using resources from the private sector wisely, instead of only looking to that sector for funding, which can often come with stipulations and rules that make using the funding impractical or tiresome.