by admin
November 13th, 2012

Challenges ranging from driving economic growth, tackling climate change, improving education and health outcomes are shared throughout the world. But while the impact might be shared between developed and developing economies, we are still seeing a wide divergence between geographies in the resolve of governments and the behaviour of companies in acting responsibly and sustainably in the face of these challenges.

Governments vary considerably in terms of action on climate change — witness the challenges of securing commitment and action at the Rio +20 United Nations Conference on Sustainable Development Summit in June. What was most notable about this conference was the elevated role of the private sector, with over 2,500 business delegates. Most of these participants, however, came from predictable sources in the US, Europe and Japan.

While economic, social and environmental challenges might be global, the business case for action is not. Stark evidence of this comes from the Global 100 List of most sustainable companies, in which Asia does not have any entry within the top 20. Indeed, all of the Asian entrants come from Japan, South Korea and India, the latter a country where prominent companies such as Hindustan Unilever and Reliance Industries have built their business models around principles of inclusion and sustainability.

But what about the rest of Asia? Does sustainability even matter in China? The unexpected answer is yes. In fact, according to a survey by Interpublic Group (Weber Shandwick’s parent company), Chinese consumers are actually more influenced by responsible and sustainable activity by companies and brands than their peers in more developed countries, including the US and Germany. A staggering 79% of Chinese consumers sampled in the survey stated that they had changed a buying decision based on the environmental reputation of the brand in question.

Smart companies, including BMW and Volkswagen, are wise to this reality and the concern among consumers, but this has not been evident within the emerging multinationals. While governance and reporting standards have increased, particularly among companies that have listed in New York or London, this trend is not consistent. Moreover, the number of business models that are built with sustainability in mind, or brands that have positioned themselves on the basis of their responsibility, are few and far between.

The real momentum within the broad realm of corporate responsibility in Asia is still held, unfortunately, by companies based outside the region. Pressure that has been applied on multinationals, such as supply chain dynamics in Vietnam or palm oil production in Malaysia, has forced significant changes on business practices in Asia. But we have not yet seen the widespread transfer to domestic businesses across the region.

As living standards grow and economic, societal and environmental pressures increase, we will see a change in corporate behavior here in Asia. The critical question is whether emerging Asian multinationals will factor responsibility and sustainability into continued business opportunity, or whether reaching Asia’s concerned consumers will be left to the predictable sources among European, American and Japanese multinationals.

John Mandeville is head of reputation, Hong Kong, at Weber Shandwick

This article first appeared on the Weber Shandwick Social Impact blog

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