Firms must give back to community even during crisis (Business World Online)

Monday, December 1, 2008 | MANILA, PHILIPPINES

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BUSINESSES SHOULD still practice corporate social responsibility (CSR) even if they are forced to tighten their belts during times of economic crisis.


Companies should likewise not be forced to choose between profit and ethics when making a critical business decision, since the two can actually go hand in hand.

Speakers at a recent forum on corporate ethics noted that it is now more significant than ever for local firms to give back to the community and examine whether their business practices are not crossing ethical boundaries.

"It’s now more important than ever for companies to be more responsible to the community. Any company that doesn’t have some form of corporate social responsibility will likely stop to exist and go out of business," said Mario A. G. Lopez, an Asian Institute of Management professor.

"My problem is that CSR has become a formal program for many companies, rather than a philosophy," he added.

Zonito Torevillas, executive director of the Ronald McDonald House of Charities Philippines, challenged participants to give back to the community by giving to charitable programs like the organization’s Bright Minds Read program.

The program, which started in 2002, helps the country’s school children improve their reading skills.

"We have to [think] how we can have a huge impact [on the community] even with such a small budget [for corporate social responsibility]. If we are making money, then we also need to give back to the people," she said.

Aside from being more socially responsible, businesses should also reassess whether their practices are contributing to the common good, especially during times of turbulence, speakers said.

Benito L. Teehankee, associate professor in business and governance at De la Salle University’s Graduate School of Business, said it is more crucial during a crisis for companies to reexamine their business practices and see if these are aligned with the needs of all stakeholders.

"We all know the notion of a lighthouse. In times of storms, navigators at sea will look to the lighthouse to guide them away from reefs or point them to safe waters. The more turbulent the environment, the more we need people to have ethical visions or [what] we might call a moral compass," Mr. Teehankee told participants.

"The change must start at the top," Mr. Lopez said in an interview after the forum.

Among the ethical issues that a company faces are tax evasion, violation of job security and environmental damage, Mr. Teehankee said.

"For customers, the ethical issue may include unsafe or unhealthy products; for the community at large, nudity in public advertising; for suppliers, delayed payments," he added.

For Mr. Lopez, local companies sometimes neglect what is ethical because they have conflicting interests and have no sense of community.

"The foundation of community in the Philippines has been shaken...We need to rebuild that sense of community... We need a vision of ourselves as part of a larger community, not just a member of our own company or organization," he said.

Mr. Teehankee said companies need an image upgrade, noting that they are perceived as doing whatever it takes to maximize profit.

"More fundamentally, businesses need to rediscover their original purpose and try to regain the trust of their stakeholders," he said.

"Business must be seen as trustworthy by society and in return society gives it trust... It’s a symbiotic relationship," he added.

Mr. Teehankee said the pursuit of profit does not have to be at the expense of ethics. "Ethics or profit is a false dilemma... because it makes us choose as if we have a choice. What appears to be conflicting can actually be designed together. It’s the duty of the manager is to creatively achieve [both]."

Link →　http://www.bworldonline.com/BW120108/content.php?id=043
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I just came across this article and found very interesting viewpoint. I also believe that you can pursue profit while you also respect ethics.

But the dillemma I think the most is that the larger a firm becomes, the less decision one person in a firm can make. They have got millions of employees, stakeholders, and so on.....

Unless we all shift our way of thinking, this article is just a whitewashing.