Thaipat Institute

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Process over Project

Pornnalat Prachyakorn

The Thaipat Institute wants companies to think about CSR in their daily operations and not just during philanthropy drives.

The oil spill in the Gulf of Mexico earlier this year that nearly brought down BP, and Thailand's Map Ta Phut industrial estate dispute have directed public attention to corporate responsibility for society and the environment.

Although corporate social responsibility (CSR) has gradually gained interest among businesses in Thailand in recent years, most organisations tend to fix their focus on traditional philanthropy that may not deliver long-term solutions.

"Organisations should focus more on CSR during their operations rather than after," said Pipat Yodpruditikan, director of the Thaipat Institute (the Foundation for Thailand Rural Reconstruction Movement under Royal Patronage).

"It's more important to be responsible and look after society in a preventive way."

Integrating CSR in business management and operating processes is an effective way for businesses to take a preventive approach to any negative effects towards the community or the environment.

Using CSR initiatives only after problems occur is inefficient. Instead, companies should be proactive and rethink potential pitfalls within their production chain.

Donations or volunteering for public activities are popular with businesses because they find it an easy way to communicate with the public.

Citing Map Ta Phut, Dr Pipat said the offers by businesses and regulators to heal the impacts after the problems occurred did not amount to sustainability. However, he sees a bright future with the increasing shift in CSR to process-based from project-based, particularly among big corporations.

Modern businesses have come to realise the traditional model focusing on maximising profits may not be sustainable.

"Competitiveness requires ethics and morality to build long-term competencies," said Dr Pipat.

Understanding and awareness of CSR in processes are spreading among business organisations. This is coupled with the new ISO 26000 standard to be introduced in December and which should lift the standard of CSR practices, he said.

Growing pressure from business partners and supply chain networks also ac celerates positive changes in industries. Companies such as Thai Oil use CSR to regulate procurement, while export companies face strict requirements based on CSR criteria from the EU, for example.

Dr Pipat is often asked if CSR has any impact on the growth of business. He believes making it a part of the corporate structure supports the bottom line.

"Linking CSR to corporate strategies can help leverage core business competencies," he said.

For example, a newspaper can save 20% on production costs by using a specific ink, while an ATM can allow customers whether to accept or decline a receipt.

Dr Pipat said sustainability cannot be achieved if organisations still only provide lip service or focus more on communication than CSR in operations.

"Part of the jigsaw puzzle for success is not only top-down, but also bottom-up engagement within organisations," he said. "Support from the CEO alone is not enough; staff participation is also needed."

Dr Pipat said organisations should also set up a department responsible for align ing CSR to corporate structure, making sustainability a part of everyday work.

"CEOs first need to change their mindset as some do CSR only to avoid criticism," he said. "They should set the direction of CSR to be in line with that of the business."

The Map Ta Phut case clearly reflects how the community was dissatisfied with the government's enforcement of laws regulating businesses.

"The government sector is weak. Business organisations no longer wait for the government to make a move, but try to solve community problems themselves."

Despite growing awareness that businesses cannot dismiss CSR, incentives are needed for certain groups such as small and medium-sized enterprises that may not be ready to make a CSR commitment due to financial concerns.

"The maturity of each organisation is different. Some companies have CSR in their nature and don't need to be forced by laws. Some companies that are struggling to survive are less likely to have thought about it," he said.

Incentives may include tax deductions or access to financial resources like low interest rates or loans.

As a non-profit organisation aiming to promote socially responsible practices in business organisations through research, training and consulting, Thaipat will continue its mission into the coming year with more focus on collective action.

"We've been working on drawing various organisations to work together in a collective way,'' Dr Pipat said. ``CSR cannot be driven by one organisation alone. We need to create an economy-of-scale power with accumulated resources."

Ongoing Thaipat projects include public training and workshops and in-house employee engagement programmes on CSR for more than 170 firms with more than 5,000 employees participating.

Thaipat has also collaborated with the Social Development and Human Security Ministry in drafting national CSR policies.

The institute supported the creation of the CSR Promotion Working Group under the National Social Welfare Promotion Commission earlier this month to help promote social enterprises and collaboration among various agencies and ministries in a holistic approach to CSR policies.

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