CSR Emphasized

Former Studies

A.) CSR Standard & Guidelines

Levine (2008) Chinese Stock Market were assessed with Chinese Govt
Involvement

Shenzhen Stock Exchange (SZSE)

Shanghai Stock Exchange (SSE)
China Bank Regulatory Commission (CBRC)
State Assets Supervision & Administration Commission (SASAC)

Findings : China National Textile & Apparel Council (CNTAC) was the
leading local NGO of China

Tschopp et. al. (2014) Reviewed 4 Global Standards

GRI G3
AA1000 PRINCIPLES
UN GLOBAL COMPACT
ISO26000

MISSION
SCOPE OF CONTACTS
GOAL OF CONTENTS
GOVERNMENT STRUCTURE

..OF EACH ORGANIZATION THAT ISSUED THE STANDARD

FOUR VARIABLES :
COMPARABILITY
CONSISTENCY
RELIABILITY
RELIANCE

Findings: GRI G3 turned out to be the best standard to provide the

useful information
for decision makers for CSR
Noronha et. al. (2013) Reviewed CSR regulations of China since 2001.
Overall they argued that CSR reporting practices were still at a very
preliminary stage and more objective researches which are free from
government support or intervention were urgently needed.

Ma (2009) Global firms in China including Chinese NGOs and Global

NGOs:
Fair Labor Association (FLA)
CSR Asia
China CSR
China Development Brief (CDB)
UN Global Impact

Findings:Summarized al useful CSR Resources

Lee (2013) Reviewed the development process related laws-evaluation

systems
He suggested key approaches for Chinese Academy of Social Sciences
(CASS)

Choi (2014) Traced the GAP

Chinese CSR standard and global standard by comparing SR (Social
Responsibility) reports of Chinese vehicle makers with global makers.

Findings: Regarded the CASS CSR 2.0 as a defense mechanism for

Chinese local companies against global standards..

B.) CSR Trend & Ideological Background of China

Lin (2010) Traced Chinese CSR Development From 3 Perspectives:
1.) Historical & Ideological Foundations
2.) Industrial Motivations
For CSR Disclosure and guidelines

Findings:
-Argued that there existed a gap between global standards and
Chinese implications or measures for CSR,
- China still stayed at the early stage
that CSR Initiatives might rest on more the awareness -raising
or course- defining
rather than on the complete implementation.
Darigan et. al. (2009). CSR Issue changes and accessed corporate
citizenship in China after 2008 Beijing Olympics.

Findings:

A. Argued that CSR issues in China have been closely concerned

with Harmonious Society resulted from Confucian Community:
Social Stability
Reducing Corruption
Environment Protection
Asserted that Corporate Citizenship > another factor in managing the
sustainability of China

Choi (2008) CSR Trend of China From the perspective of CSR type
change since Open Door Policy in early 1980s.

China CSR activities of China changed from the economic motivation

to the strategic motivation

Profit Maximization or shareholders value >

Balanced approached among stakeholders or value sharing between
business and society.

Strategic CSR
Still stayed an emerging step rather than the responsive CSR in China
2005, only as the starting point for Harmonious Society or Scientific
Development Theory

C.) CSR Case studies

Graafland et. al. (2014)

Economic Performance oriented CSR was a major trend in China

Through survey of 109 local firms, only small portion of them

suggested concrete targets for social and environmental aspects of
CSR.
Findings:
Most critical challenges:
Insufficient supports from local government or local NGOs
Relatively high costs of CSR implementation

Choi(2008)
CSR type analysis for global vehicle makers like Toyota or GM - in
China
3 Types: Preventive CSR, Responsive CSR, Strategic CSR

Choi (2009) CSR Types of three ICT Firms of China: China Mobile,
Lenove, and Huawei

Choi (2013) Examined suicide cases of Foxconn

By Foxconn SR reports by applying Performance Indexes of
GRI G3.1 and re-organized
the labor condition of Foxconn on the basis of GLA
investigation reports.

Kim(2011) China Minshing Banks, - SR report to check its CSR type

and evaluate the influence on overall Chinese
Society.
Cooke (2010) from Human resource management perspective - local
managers of textile and apparel makers in China were concerned with
CSR issues, in particular:
labor contracts or working conditions
institutional approach

CHINA CSR Trend since 1980

The study focused mainly on CSR Guidelines and Standard.

To access the difference between Chinese-Global

China (CASS CSR 3.0) representative standard vs. GRI G4
(mostly agreed upon standard globally)

Huawei (Huawei josh youxian gongs) -83.5 (1st)

ZTE (Zhongxing Tongxun) - 77 (3rd)
Lenovo (Lianxiong jutuan) - (8th)
Midea (Meidi jutuan) (6th)
Haier (Haier Jituan) -(22nd)

Chinas Biggest Smartphone makers_Xiaomi

Chinese Big Three: Alibaba, Baidu, Tencent
Leading ICT and Global ICT Firms:
Google, Apple, Amazon, Ebay, Cisco, Samsung Electronics, Sony

1st Period
Economic policies focused on:
Export Driving Industry & Manufacturing business development
through Foreign Direct Investments (FDI)

Target Regions of FDI included 4 Special Economic Zones (SEZ)

of Southern China, and 14 Eastern Harbor Cities
Ideological Backgrounds
Socialism with Chinese Characteristics (zhongguo tests
shehuizhuyi)
Primary State (initial Stage) of Socialism (Shehuizhyi
chujireduanlun)
Getting Rich First Theory (Xianghun)

Main Issues
Focused on Personal Income Increase & Job creation of general
people, profit maximization of firms and economic responsibility

2nd period (1990 -2001) China joining WTO

Requested both Legal Responsibility and Charitable based on
shareholder-value maximizations
Government structure reforms & Operational efficiency increase
for SOEs
Management innovation (SMEs)
Domestic Market Development (core assignments)
Regional Development policies:
Western Regional Development (Xibudakaifa)
Yangtze River Delta (YRD)
Great Pearl River Delta (GPRD)
Ideological Background:
Social Market Economy (Shehuizhiyi shichangjingi), South Tour
Speech (nanxunjianghua), Black Cat and & White Cat Theory
(heimiaobaimiaolum), 3 Representative Campaign (sangedaibiolum)

Main issues:
Economic Performance to address the poverty issue of China
Managerial software like - trust, honest, business ethic, non-
discrimination, justice in going abroad strategy

3rd period (2002-2011)

Political Leaders: Hujintao & Wenjiabao actively propelled lots of
reformative actions to reduce side effects resulted from a high speed
economy growth for last 20 yrs.

Balanced development (junhengfazhan) & Harmonious Society

(hexieshehui) emerged core ideologies for the eleventh Five Year plan
in 2006-2010

Regional Development:
Central District Rising (Shongbujuegi) Strategy
North Eastern Three Provinces Reconstruction (dongbei sansheng
zhenxing) Plan
Metropolitan Integration projects (Metropolitan Economic Zone
Forming)
Ideological Background
Sustainable Development Theory (keyuefazhan)
Scientific Development Theory ( Keyuefazhanguan)
Local firms of China began to take deep interest in the environment
protection, social stability and governance structure and seriously
looked into global standards.

Key Findings /Points in the Third period:

- Internal Request for Chinese firms taking a higher level of social

responsibility have been more increasing after Beijing Olympic in 2008
- Around that time, devastating earthquake in Sichuan province,
the melamine infant milk accident, a poor labor condition of migrant
workers including Foxconn employees, and severe air pollution made
CSR an urgent task in China.
(Cho 2014, 310).
The global financial crisis in 2008 also required local firms do
more specific actions to demonstrate a corporate citizenship in finding
a shared value between business and society.

Economic policies by Xijinping government can be summarized as

environment, energy, urbanization, domestic market, private sector,
and seven strategic industries.

Fourth Period (2002- present)

Regional Development
- New demand creation by:
Converting the rural areas into new cities
New Nationwide logistic system innovation, so called: One Belt
and One Road (yidaiyilu) project
Connect the underdeveloped inner regions developed regions
on Eastern China, Central Asia, and Eastern Europe,
AIIB (Asia Infrastructure Investment Bank) - Chinese
government plans to supply the capital!

Ideological:
Big Country Diplomacy
Chinese Dream (Zhongguornang)
Greater Two (G2)
Main Issue:
Green GDP
Creativity Shared Value (CSV)
Had been more popular at the fourth period than the previous
periods

Xijingping government tries to:

Cut down the income inequality and to adapt a relatively low growth
pattern, the target increase rate for GDP,
7% during the Twelfth-fifth year from 2011 to 2015
Considering a high growth rate of GDP of China, 10-13% in the past,
the target rate 7% cane considered as a clear adjustment for the
growth oriented economic policies
Xinchangtai, can be interpreted as the Chinese style New Normal
which requires local firm or Chinese people to adapt a new
paradigm of a long term growth
Since 2012, Xinchangtai has emerged as a new ideology in
China for accomplishing the Sustainable Development
Basically Chinese government thought that the CSR Standards should
be closely related to the communitys social and cultural standards
should be closely related to the communitys social and cultural
demands, so the CSR framework should be tailored to the unique
situations of China (Xu & Yang, 2009, 331-332).
2009- CASS -CSR 1.0 release
Chinese own CSR standard

Overall, a practical initiative for CSR discourse in China has been

taken by government rather than by any other entities including SOEs,
MNEs, or NGOs through four periods.

Chinese Standard Introduced

2006 Company Law (Chinese Government)

Refined firms to comply with social mobility,
morality and lean social responsibility.

Social Responsibiliy to Listed Companies ( SZSE)

Voluntary issuance of CSR reports on a regular basis

2008 State Environment Protection Administration of China

Mandatory Regulation requires companies open the
environmental information

Shanghai Stock Exchange (SSE)

Mandatory rules:
Guidelines on listed companies environmental
Information Disclosure
Notice on Strengthening listed Companies
Assumption of Social Responsibility
State-owned Asset Supervision and Administration Commission
(SASAC)
Mandatory Notification on Issuance of Guidelines in
filling Social Responsibility for central SOEs

2008-2011
 China National Textile & Apparel Council (CNTAC)
Chinese Characteristics - with regard to the
standards because foreign codes of vendor conduct and
other similar manufacturing standard like SA8000 were to difficult
for Chinese firms to keep (Lin 2010, 81-82).

The CSC9000T establish by CNTAC in 205 as a social management

system to imitate ISO14000 was described to be much softer than
global standards.

Later on suggested the China Sustainability Reporting Guidelines for

Apparel and Textile Enterprises (CSR-GATEs) in 2008

Guidelines on Social Responsibility for Industrial Corporations and

Federations (11 industrial Federations)

Revealed that the behavior principles, the goals and the performance
indicators for CSR should be compatible with the reality of Chinas
socioeconomic condition and industrial development status.

Banking sector:

2009 China Banking Association (CBA):

Guidelines on CSR for Banking Financial Institutions in
China
Encouraged all banks to make the annual CSR reports to
address economic, social nd environmental
responsibilities and submit them to CBA voluntarily.

2009 CASS CSR Reporting Guidelines 1.0

2011 CASS CSR Reporting Guidelines 2.0
2013 CASS CSR Reporting Guidelines 3.0

Covered the first evaluation criteria as well as the comprehensive

performance indexes for CSR activities in China.
In result, the CASS has announced ranking in every year for Top 100
SOEs, Top 100 Private Firms, and Top 100 MNEs

Related 6 Indicators:
Completeness (25%)
Sustainability (30%)
Balance (10%)
Comparability (10%)
Readability (20%)
Creativity (5%)

THE CASS CSR 3.0 STRUCTURE

CASS CSR: 180 Articles, and 6 Major parts
Reporting Preface
Responsible Management
Market Responsibility
Society Responsibility
Environment Responsibility
Reporting Postscript

CASS transformed

Triple Bottomline + ESG + Stakeholder Model = General guidelines for

Chinese CSR Standard

Findings :
The general idea is the organization and objective of CASS CSR 3.0
mostly agree with the Triple Bottomline or the performance
indicators of GRI G4

However, theres are still exists a clear gap between CASS CSR 3.0 and
GRI G4 in the Level of concreteness, completeness, reliability and
measurability for each article.

Global Standards

1.) GRI G4 (1997) - by Coalition for Environmental Responsible

Economies (CDRE)
- widely accepted standard for Corporate Reporting: on
environmental and Social Performance
Sustainability Reporting Framework - Published 1999,
2000,2002, 2006. (G3)
G3.1 -March 2011, with expanded guidance on reporting for
genre human rights, local community related outcome.
 G4- May 2013, required all reports to apply G4 standards by
December 2015.

2.) Account Ability (1996). Institute for Social & Ethical Accountability
-AA1000 FRAMEWORK - to promote CSR activities by
assuring the quality of CSR accounting, auditing and reporting.
- Principle Standard (2008) -to assist in the development of CSR
Reporting Practices.

3..) UN Global Compact (1999) - Framework comprised for guiding

firms to govern socially responsible action and reporting

ISO26000 Guidance of Social Responsibility

Bottom-Up Approach
Encourage voluntary activities rather than mandatory
approach
To present the practical guidance regarding social
responsibility not only for firms but also for government agencies
all of the public organizations.

7 key issues, of it include human rights, labor

practices,consumer, community involvement & development,
and the organizational governance structure. (Choi, 2014, 298).

GRI Guidelines are mostly rule-based standards

GR - 149 articles

General standard disclosures of G4 - 58

Specific Standard Disclosures
Economic (9)
Environment (+4)
Social (+3)

Overall it can be said that the responsibility of firms to monitor and to

evaluate their supplier practices in
environment, labor, human rights and social impact has been
reinforced G4.
(p.354)
GLOBAL vs. CHINESE ICT Firm

Findings
Overall those leading ICT firms of China have more complied with
GRI guideline or global NGOs standards, rather than CASS CSR
guideline or other local standards.

Furthermore, Chinese ICT firm tend to put emphasis on

environment issues rather than social issues or economic ones.

Since the suicide accidents of young employees in Foxconn, most

of ICT firms have taken are interests for working conditions or
employee welfare.

Findings of Distinction:
A Noticeable distinction for SR reporting trend between global
ICT & Chinese ICT firms lies in the assurance process and other NGOs
partnership.

MAJOR ISSUES

Most fundamental reason for difference between Chinese standards

and global standards:
CASS CSR standards are hardly be free from the government
influence;
Global standards have been mostly released by global NGOs like GRI
or ISO. (p.358)

Major issues: Sustainability, Fairness, and Evaluation

Main conclusion of the study:

The higher ranking firm does not necessarily mean that it conducts
the SR better than lower ranking firms or takes a more social
responsibility than others.

In terms of fairness, CASS CSR 3.0 in qualitative accesses, it would

be difficult to be free from the government influence no matter
how hard the evaluator tries to take a third party stance.
 Therefore, it can be argued that Chinese ranking practice for the
reports can mislead the goal of SR report or activities due to
having to much political, regional or marketing purpose.