An interesting story developed over the past few days in Singapore - as shareholders arrived at the Annual General Meeting of Golden Agri Resources, the palm oil arm of Sinar Mas on Tuesday, Greenpeace held their own press conference in Singapore to "release fresh evidence showing how Sinar Mas continues to destroy Indonesia's rainforests despite promises to stop."   Interesting in that the story got half page coverage in the local paper (in the Money section) and as the journalist who covered the story pointed out  this is "a rare confrontation in corporate Singapore".   NGO pressure has not been a significant driver for sustainable practices in Singapore to date - however, perhaps this is changing.  Businesses who do have operations outside of Singapore and are part of global supply chains are becoming increasingly vulnerable to scrutiny and resulting campaigns.   Businesses based in Singapore would be sensible at the very least to KIV (keep in view) this issue and at best start becoming global NGO aware and understand the risks and opportunities that NGO's can bring to a business. 

There's been a few people suggesting that the mascot for the Shanghai World Expo is a Gumby rip-off. I'm not convinced on that one, but I am convinced that it's a copy of the logo for Xinxiang Haibao Electrical Appliance Company (新乡海宝电器有限公司). In the picture left, the Shanghai Expo mascot (Haibao) is on the left; the original Haibao Electrical Appliance Company logo is on the right. You can see larger versions here (the Shanghai Expo mascot is here, and the Haibao Electrical Appliance Company logo is here).

The official line from Haibao Electrical Appliance Company is that it's never had so much free publicity... But the mascot is clearly a copy.

Somebody has posted a very interesting story at Tianya, China's most widely visited BBS forum (it's in Chinese only - obviously...). So far, the story has been visited 393,421 times and resulted in 2,081 comments (according to the Tianya site counter, a further 500 people visited whilst I was writing this post). So, what's caused all the commotion?

It's pretty simple. The writer says that he was born in a drought affected area in China, and during the current extreme droughts affecting parts of China donated immediately relief was sought (FYI: drought has affected parts of China for months, with rainfall 60 percent below normal since September. Guizhou province has been particularly hard-hit, with 86 out of its 88 cities within the drought zone and more than 17 million people short of drinking water). However, when the writer returned to his home village in Guizhou, he was shocked to discover a brand new car sporting a sign in the window saying "Guizhou Drought Relief Vehicle" (click on the link above to see more and larger photos of the car and sign).

Like many others in China, he had seen the pictures on TV of the relief efforts funded by donations (his included), but now wondered just where his money had gone. Going by some of the comments I've read, many others are wondering that, too. The original poster was so angry at the misuse of money, that he picked up his camera and started shooting. And now it's on Tianya and hundreds of thousands are reading it.

The question is relevant to companies. Where do donations go? Into this nice, new 'drought relief' vehicle?

Rob Hanlon and I recently wrote an article in which we argued that the portrayal of Google as a defender of human rights for withdrawing from China is a theatrical performance (you can see the article here, and the follow up here). This morning I had an email from Salil Tripathi - Director of Policy at the Institute for Human Rights and Business - who pointed me to two pieces he's written from a more positive perspective on Google's withdrawal from China (you can see them here and here). Rob and I are not necessarily convinced by his argument, and we'll be following up with another article on this soon, but Salil's articles are interesting and worth a read.

One of the issues that concerns me about Google's response to our article (see the Google letter here) is the way in which the company accuses us of "gross[ly] misunderstanding ... Google’s actions and motives" but then fails to demonstrate what we misunderstood. Apart from repeating a handful of publicly available statements (e.g., they entered China with 'reservations', that they were not failing China, and so on), the statement does little to convince us that they are indeed the defenders of human rights some (including Salil) make them out to be. But more troubling, and an issue we will take up in an upcoming article, is the claim that (in response to our view that withdrawing from China and not, say, Vietnam, smacks of 'human rights opportunism' - or as we call it "Google Theatre") "a comparison with other countries would not be responsible".

Why would it not be responsible? Is there some sort of hierarchy of human rights abuses, where a company can determine not to do business in countries with the 'worst violations' but remain in countries with 'lesser violations'? Surely human rights are human rights, and there is no gradation that allows Google to say that comparing its actions in one country with another are not responsible.

It is also interesting to note that Google did not mention the term 'human rights' once in its response to our article. That in itself is perhaps more telling than anything else...

On 31 March, Rob Hanlon and I published an article in the CSR Asia Weekly called "Google Theatre" (you can download a pdf version here). In that article, we argued that "the portrayal of Google as a socially responsible business…is a theatrical performance". Obviously our view was critical of Google (and other companies gaining good publicity over their withdrawal from China on purported human rights grounds). We also took a swing at human rights groups (in particular Amnesty International and HRW) over their failure to make a strong case that human rights are a business responsibility. Business & Human Rights Resource Centre picked it up and sent it to all organisations named, and now has posted responses to our article from two of the organisations we criticised (Google and HRW), which you can read here.

Rob and I would be interested to hear from anybody on either our article or the responses from Google and HRW. Our contact details are on the article, and mine is on the website here (sfrost@csr-asia.com).

BTW: Rob is my former PhD student, and submitted his thesis last week. It is on CSR, human rights and corruption in China, Thailand and Cambodia. I hope that it's published soon because it's a fantastic piece of work!

Update (23 April): See updated story and links here.

Here's a conversation I had the other day with a person who works for a factory (producing trim for garments). If companies are really serious about CSR in supply chains, then they really do need to give factories a longer lead time... This example show how ridiculous the situation is getting:

Factory Representative [FR]: Sometimes I just don't understand... Why is the lead time so short on this order?
Stephen Frost [SF]: How long is it?
FR: The customer [a factory producing a garment for a big brand] wants us to deliver within two weeks.
SF: Two weeks from placing the order?
FR: Yes.
SF: Is that possible?
FR: You know, the material has to be shipped from Taiwan. It takes eight days for it to arrive at the factory in China.
SF: Why do you use material from Taiwan?
FR: It's higher quality. Then by the time we make the product and ship it... I advised them that the minimum time is three to four weeks, but they insist on two.
SF: Will you do the order?
FR: We can't. I've told them we can't do it. I don't understand why they [the brand] don't give the vendor [producing the garment] enough time to do the garment. They expect something magical...

Everybody reading this would know the name of the brand (whom I won't mention for obvious reasons). They want something more than magical. They want the impossible. And they'll get it; they'll find a factory that can meet the deadline and which does it by working around the clock for a price that can only be met by underpaying workers and sidestepping an array of laws, rules and regulations.

The sad thing about all of this is that the factory in question wants to become more sustainable (and understands that sustainability is the future), but is struggling to understand how brands can preach CSR on the one hand and quote lower and lower prices for shorter lead times. The disconnect does nothing to convince them that anybody is truly serious about this. And in the long run, the damage this does will be hard to rectify...

So says Joerg Wuttke, president of the European Chamber of Commerce in China (as quoted in an AAP story in today's Hong Kong Standard, which is unfortunately not available online). Wuttke is quoted in the piece as saying China has increasingly taken a "we don't have to listen to you any more" attitude with the rest of the world, and then said part of the reason for that was because of rising nationalist sentiment on the Internet. "When we meet officials they are very worried about the netizens. They really feel they have to be responsive to these interest groups."

Although some may argue this is a good thing, I'm in two minds about it. I can certainly see the benefit of government officials responding to the interests of citizens. However, given that much of what circulates on Chinese social media sites is compromised by people paid to post comments and stories for clients (so as to spread rumours about competitors), I wonder to what many officials are actually responding...

You learn something everyday - for me today was the term astro-turfing.  Being an ex-hockey player I was intrigued about how astro-turfing could relate to a company and CSR but now I get it thanks to this article.  Basically depending on who you read, it would seem that astro-turfing is an attempt by an activist (or PR company/lobby group) to create a campaign that appears to be a diverse, grass root, independent reaction to an issue. 

The challenge for a company if and when they are on the receiving end of a campaign (the example given in the article about Resorts World here in Singapore receiving targeting template letters from those wanting to express a view on the import of whale sharks into Singapore)  is to be able to determine whether they are a victim of genuine astroturfing (perhaps one person with a grievance creating an entire website or campaign) or whether they are receiving organised feedback that is in fact representative of a diverse section of society - and whether or not if the difference can be established if they require different responses.

So from a CSR perspective, the issue would be whether or not it would be ethical or not for a company to be behind astro-turfing (for example in relation to a product) or whether or not a company would be a victim of an astro-turfing or a genuine campaign and how to respond to either.....

I said I learnt something new today - not that I necessarily resolved where that learning took my thoughts!

Yesterday afternoon, along with Kalina Tsang and John Sayer from Oxfam Hong Kong, I attended a press conference to release the CSR Survey of Hang Seng Index Constituent Companies 2009. This is the second year that CSR Asia has conducted research for the Oxfam Hong Kong publication (see for 2008), and there has been much more media interest in the 2009 version. Some of the big differences include that last year less than half the HSI companies responded, but this year over 70% made the effort, and companies based in mainland China have generally improved their performance (i.e., are catching up to leading Hong Kong companies fast). You can download the report for free here (in English) and here (in Chinese). Note that both links take you to the full pdf version.

Kalina has been interviewed all week about this, and TVB interviewed me before the press conference for a program they air called "Finance Magazine" (broadcast on TVB Jade). I'll link to this when it's aired.

We'll have a full story on the report in next week's CSR Asia Weekly.

Update: See here for the TV show on TVB Jade.

In the first half of 2008, there were 330 'illegal strikes' in Vietnam (see more here). And now comes news that up to 10,000 workers "have walked off the job to protest low salaries and lousy meals" a shoe factory in Bien Hoa City, Dong Nai Province. The factory is owned by Pou Chen Vietnam, which is in turn owned by the Taiwanese-based Pou Chen Group (whose subsidiary Yue Yuen is the world's largest branded footwear manufacturer). According to the report linked above, workers on the "the picket line threw mam tom (shrimp paste) and pig blood pudding on other workers for not joining the strike". Pou Chen has agreed to raise wages by 5%, but workers have rejected the offer saying that the US$70 per month they earn is not enough to meet rapidly rising living costs.

In last week's CSR Asia Weekly, Rob Hanlon and I argued that "the portrayal of Google as a socially responsible business standing-up for human rights in China is a theatrical performance". Now comes news that Google said last week "Vietnamese computer users have been spied on and political blogs hacked into [and] infected machines had been used both to spy on their owners as well as to attack blogs containing messages of political dissent".

There is no word that the company intends to withdraw from Vietnam, despite "[a]nalysts, rights groups and diplomats say[ing that] the human rights situation in Vietnam has been worsening."

Hugh MacLeod once said that the social media enabled people to have a smarter and faster conversation than most companies. I'm willing to bet that the Nestlé Kerfuffle is just what he had in mind.

Please take the time to watch the presentation (here at the brilliant Prezi). It shows the first four days of the online PR battle between Nestle and Greenpeace over rain forests, palm oil and Nestlé's Kit Kat.

The short version is that Greenpeace UK started a campaign that included posting a video on YouTube arguing that Nestlé buys palm oil from companies that destroy rainforests. Nestlé got YouTube to take down the video, and thus began Nestlé's descent into a PR battle that went belly-up from Day 1. Required viewing for anybody thinking of how to engage stakeholders (a kind of "how not to to it"). Well worth your time...

Four defendants in the Rio Tinto case, including Australian national Stern Hu (pictured left), were handed jail terms from seven to 14 years for bribery and stealing commercial secrets by a Chinese court yesterday. The verdict was handed down by the Shanghai No.1 Intermediate People's Court. Stern Hu was sentenced to 10 years in jail for bribery and stealing commercial secrets, with his assets confiscated and a fine of 1 million yuan (US$146,413). Wang Yong received a jail term of 14 years, with his assets confiscated and a fine of 5.2 million yuan. Ge Minqiang was sentenced to eight years in jail, with his assets confiscated and a fine of 800,000 yuan. Liu Caikui received a jail term of seven years, with his assets confiscated and a fine of 700,000 yuan. You can see many more stories on this case here.

Every man and his dog will have something to say on this, and you can read most of it at the link above...

Another budget airline in Asia bites the dust and, no surprises, hundreds were left stranded with perhaps thousands more wondering about tickets for upcoming trips. No wonder angry passengers in Macau tried to storm the departure area at the airport yesterday. However, I can't condone subsequent actions that included attempts at preventing other passengers flying non-bankrupt airlines getting to their gates on time (see more here).

The Viva Macau website is still operational, although I can't see any notice about the planes being grounded.

On a related note, while looking for a list of budget airlines in the region that have gone broke, I came across this website: Low Cost Airlines Graveyard. It makes you wonder how many of these outfits cared about anything other than a quick buck.

Yesterday, wandering the corridors of City University of Hong Kong, I bumped into a colleague who is a well respected commentator and go-to guy for both the English- and Chinese-language media in Hong Kong on things happening across the frontier. Having just passed a stack of newspapers on whose front page was the headline "Searching for answers on Google's game plan", I asked him what he thought about Google's action plan for China. Without missing a beat, he said he said they i) gain public attention over withdrawing from China because of censorship, but ii) get to keep China business by redirecting searches to google.com.hk, while iii) garnering praise as human rights heroes by people who think they are leaving China because of censorship issues.

Which is pretty much what this guy is saying.

Google's withdrawal from China is big news (of course) - see the thousands of news and blog articles already posted here (via Google) - and you can read to your heart's content from amongst those... I was, however, interested to see that Human Rights Watch has the story on its front page with the headline, "Google withdrawal shows government intransigence". The sub-heading states that "other companies should stand together against censorship" (you can see the full story here). Which makes this the biggest human rights story of the moment. Interesting...

Today sees the launch of a new international campaign to demand that Samsung accept responsibility for the deaths of young workers from occupational cancer. Spearheaded by a coalition including Supporters for the Health and Rights of People in the Semiconductor industry (SHARPs), Korean Metal Workers' Union (KMWU), Asian Network for the Rights Of Occupational Accident Victims (ANROAV) and International Campaign for Responsible Technology (ICRT), the "Samsung Accountability Campaign" has also launched a new international petition (hit the link to sign) calling on Samsung to accept responsibility for the health of its workers, especially now that it has become a leading global brand promoting itself as a "green company".

The Coalition is calling on Samsung to: 1) accept responsibility for the hazards of semiconductor manufacturing, 2) compensate those harmed; and 3) prevent future suffering and mistreatment of workers by making Samsung a toxics-free model workplace where workers are treated with dignity and respect. You can see a video of some of the Samsung victims and their families here.

The Coalition will hold a press conference this morning in front of Samsung headquarters in Seoul.

The cover story for the Financial Times Asian edition this morning is Toyota's massive recall. With US dealers repairing close to a million vehicles so far, questions are now being asked about 'confused' priorities. Akio Toyoda has admitted the company lost it way and sense of priorities as it expanded rapidly. Putting growth and profits ahead of safety is clearly costing the company dearly now, and not just in profits. In the 2009 Interbrand rankings of the best global brands, Toyota came in at Number 8 (down from number 6 the previous year). It will be interesting to see what happens in the 2010 rankings.

So far, commentary (a lot of commentary -- over 6,000 items on Google News, and more than 4,700 blog posts) has concentrated on three main themes: i) Google is doing the right thing morally (good CSR) and has gained a lot of good will with its announcement to withdraw from China if it can't offer uncensored search results; ii) Google has just made the worst business decision of its short life by abandoning what will be a significant source of revenue as China's internet grows; and iii) Google wasn't doing so much business in China anyway, so leaving is no big deal. We could call these three views the Hoo-ray, the Who-pay?, and the Who-cares? view of the world...

But seriously, what if Google knows something about China that the rest of us don't? Here's what I'm thinking.

What if Google got to work on some serious stakeholder dialogue in China after it was accused in 2006 of collaboratoring with the Chinese government in suppressing dissent in return for access to a booming internet market? What if -- as as result -- they have a much more nuanced understanding of how their stakeholders perceive search engines, the internet, Google's role in China, and the potential for Google to push the envelope when it comes to internet openness. What if Google's New Approach to China is the result of highly informed management deciding that the time is right to push this issue in China?

I know. There are a lot of ifs. But what if I'm right? What if Google knows something about China that we don't? What if Google is betting they'll win this fight and the Chinese government will accommodate a discussion on uncensored search results? If that happens, then Google gets huge street cred on human rights, and gets to stay in China and eat into Baidu's market share. Every analyst under the sun is crunching the numbers on Google leaving, but I haven't seen any try to work out what Google staying would mean to its market share... I bet it would mean a lot...

There are a lot of ifs. But Google management doesn't strike me as being overly stupid. Maybe I should buy some shares...

The picture above shows people laying flowers on the Google sign in tribute outside its offices in Beijing (original can be seen here).

The picture left (click here for larger version) is from the Chinese media and shows that i) the Google story is getting solid coverage in China, and ii) some editors in the mainland have a sense of humour. The story it accompanies can be found here, and simply notes that Google will no longer filter search results in the wake of security breaches. And yes, it's a real Simpsons screenshot (original here).

As an aside, I've spent a bit of time today browsing Chinese BBS forums for commentary on the Google stance (and there's a lot of commentary, by the way), and it's interesting to see a lot of support for Google inside the country (some people are really imploring Google to stay). Google had around 30% of the market, which some people see as negligible, but I think the reality is that many people use Google sometimes because it simply does some things better than Baidu (the major search engine in China).

Of course the real issue is whether we'll ever see a Chinese Bart writing the line "I will use Baidu before asking dumb questions"...