Companies will step up CSR efforts post-pandemic, says NVPC deputy CEO
Businesses are fighting for survival during the COVID-19 outbreak, but once the dust settles, more socially responsible companies will emerge in Singapore, Tony Soh, deputy CEO of NVPC, says.
The COVID-19 pandemic is an unprecedented crisis that has had a massive impact on businesses. As the virus continues to take a toll on the economy, companies are in crisis management mode in a bid to maintain business continuity. Yet once the global health crisis is under control, things will not return to normal.
As companies struggle to stay afloat, the COVID-19 pandemic is posing a threat to corporate social responsibility (CSR) efforts. Research has shown that firms reduced their CSR efforts during the global financial crisis of 2008, as it became difficult for companies to justify allocating resources to non-core business activities when survival was paramount.
With COVID-19’s global downturn expected to be worse than the financial crisis, will CSR take a backseat again?
Tony Soh, deputy CEO of the National Volunteer and Philanthropy Centre (NVPC), is optimistic that on the contrary, there will be an outpouring of CSR activation. In this time of chaos, the former Chief Corporate Officer of Ascott believes that companies have been given the opportunity to reflect on their societal purpose.
“This period has caused many businesses to pause and think about what’s important. Before this, companies may have been caught up in their day-to-day operations that they’ve lost sight of [their purpose],” Soh said. “Once we emerge from this crisis, I believe there will be a different sensibility as to what business priorities should be.”
“Once we emerge from this crisis, I believe there will be a different sensibility as to what business priorities should be.” – Tony Soh
GROWING AWARENESS OF SOCIAL RESPONSIBILITY
For one, the COVID-19 pandemic has brought to the forefront the importance of being socially responsible. “We are constantly being asked to wash our hands, wear a mask and practice safe distancing. At a personal level, being socially responsible is the idea that you do no harm to the larger community, and instead contribute to its greater good,” Soh mused.
“So when we talk about corporate social responsibility, I think it’s quite similar. It’s this same idea that companies should do no harm, and should contribute to the greater good.”
However, the concept of social responsibility can at times conflict with business interests. Historically, companies have been driven by the notion of shareholder primacy, a form of corporate governance where businesses maximise the value of shareholders, before considering the interests of other stakeholders such as customers, suppliers, employees and the community.
But before the pandemic struck, a sea of change was already on the horizon. In August 2019, the Business Roundtable, a lobbying group composed of leading CEOs in the US, released an updated statement on corporate purpose. It expressed a fundamental commitment to all stakeholders, including customers, employees, suppliers and shareholders, differing from the long-standing view that shareholder profit is the sole purpose of corporations.
“It’s a more balanced way of thinking about why a company exists,” Soh said. “It brings us back to what it means to be good corporate citizens. CSR is about running a good company. It’s not something you do on the periphery, it’s not something you do once a year. I think we are beginning to see a trend towards CSR being integrated into a company’s entire operations and strategy, and across the entire value chain.”
"CSR is about running a good company. It’s not something you do on the periphery, it’s not something you do once a year." – Tony Soh
CSR IN SINGAPORE
In Singapore, 52 per cent of companies engage in some form of corporate giving, according to NVPC’s latest Corporate Giving Survey. This reflects that one in two companies are involved in CSR. “But instinctively, I will say that there are more companies doing corporate giving, maybe they just don’t formally recognise their efforts,” Soh said.
On the other hand, a 2018 YouGov survey found that 88 per cent of Singaporeans believe businesses have a responsibility to do social good.
“There is a general shift in trend towards CSR, and I expect to see the numbers improve over time in terms of the proportion of companies being involved. After all, customers themselves expect companies to do social good,” Soh said.
However, while CSR efforts globally have evolved beyond the traditional cheque-giving, it is not the case here. In Singapore, 89 per cent of companies still engage in philanthropy. This means that a majority of companies incorporate CSR through cash donations, donations in kind, sponsoring events or employee payroll deduction.
The remainder do so through volunteering and other forms of giving such as advocacy, or purchasing goods and services from non-profits.
“But CSR is a journey. It doesn’t matter how you do it, it only matters that you start,” Soh clarified. “Over time, as companies give money, they get to know more about the causes they support. As they get more passionate about these causes, it progresses from there. Maybe they will start encouraging their staff to volunteer. So I will not say that philanthropy is not useful. We want to affirm and honour all of these efforts.”
"... CSR is a journey. It doesn't matter how you do it, it only matters that you start." – Tony Soh
COMPANIES OF GOOD
To encourage businesses to give back in more strategic, impactful and sustainable ways, NVPC launched the Company of Good programme in 2016. The programme works with companies to help them better understand their existing giving profiles, build their knowledge, capabilities and networks as well as partner like-minded business to exchange ideas.
Since its launch four years ago, Company of Good now has a total of 1,800 members, demonstrating “a general trend towards more companies being conscious and wanting to do more”. “Even now, we are still getting calls from people who are interested in this programme, so we are very encouraged that there is this heart and desire to see how their companies can become companies of good,” shared Soh.
CSR IN A PANDEMIC
If anything, the COVID-19 pandemic, which has sparked an outpouring of giving from Singaporean businesses, has only further highlighted this growing awareness on the importance of CSR.
“There are many sectors that have been badly hit by the pandemic, like the service sector. It is very tough and we don’t underestimate how bad the situation is,” Soh acknowledged.
Nonetheless, several companies have stepped forward to donate essential items such as masks, hand sanitisers and personal protective equipment. Others are providing food to the underprivileged. NVPC has also put up a Collaborate For Good microsite within Company of Good’s main website, which facilitates collaborations among companies keen to provide relief during the pandemic.
On the microsite, companies can post their COVID-19 relief campaigns to seek the support and contribution of partners and the general public. For example, catering and facilities management company Sodexo is looking for sponsors and delivery partners to provide 200 bento boxes to needy families. E-commerce platform Shopee is seeking corporate sponsors to purchase essential items for vulnerable groups, including low-income families and the elderly.
“We have seen some very interesting conversations taking place there. It goes to show that while we may have expected a complete wipe-out of CSR, companies that are in reasonable shape do want to contribute,” Soh revealed.
“In the first two months of DORSCON Orange, many companies were figuring out if their ships were seaworthy and hadn’t sprung a leak during this raging storm. But I think we are beginning to see that companies are getting used to the choppy waters, and are now looking to save others. I am optimistic that we will see an outpouring of support and CSR activation on the corporate side,” Soh continued.
"In the first two months of DORSCON Orange, many companies were figuring out if their ship was seaworthy and hadn’t sprung a leak during this raging storm. But I think we are beginning to see that companies are getting used to the choppy waters, and are now looking to save others." – Tony Soh
Continuing to engage in CSR efforts is also a way for companies to future proof their businesses once the pandemic is over, Soh believes.
“COVID-19 has caused companies to work very hard to ensure their survival, but there will come a time when they need to think about what happens when the crisis is over. To prepare for the recovery period, they need to think about the future. And preparing for the future means being more focused in CSR, being good corporate citizens, and being socially responsible,” he said.
"COVID-19 has caused companies to work very hard to ensure their survival, but there will come a time when they need to think about what happens when the crisis is over...preparing for the future means being more focused in CSR, being good corporate citizens, and being socially responsible." – Tony Soh