Social Bridges present a weekly rundown of best posts on corporate social responsibility, sustainability and greener options.

1. Is your Board is ‘onboard’ for CSR?

This interesting report takes a look at the role of corporate boards in devising and implementing good CSR strategies.

Social Bridges covered the issue here.

2. Digging deeper for socially responsible business

Pete Burden thinks that a thorough commitment is necessary for a social business irrespective of its size.

3. Microcredit woes

Microcredit remains a controversial issue among the sustainability experts. Bright Simons shares his opinion with us.

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Tribal Monsoon is a well known manufacturer, wholesale seller, online retailer and exporter of handmade items from South Asia. It’s a unique venture in the sense that the traditional cottage industry of South Asia has been linked with the international clientele and that too through sustainable business practices. Tribal Monsoon is the brainchild of Mr. Faisal Shahid Butt who is also serving as its president. Social Bridges team got a chance to have a detailed discussion with Faisal on all things related to Tribal Monsoon.

Social Bridges: How you got started with Tribal Monsoon. How did you engage with the artisans from across Pakistan. When did the idea came in your mind?

Faisal Butt: The idea came to my mind in 2001-2002, in February, 2002 actually. I used to see lot of creative stores representing the local items of different countries from East Asia, South East Asia etc. Pakistan was underrepresented as we didn’t have a dedicated global store for our products. I decided to set up one for Pakistan/South Asia. I also wanted to connect the local artisans and craftsmen to the global platform. I moved to Pakistan and started working on the project. I visited many parts of the country, meeting and assessing the potential of our artisans.

Having completed the ground work, I moved back to the states. There I researched the market trends and the scope of Pakistani handicrafts. I also engaged a team of designers, graphic artists and photographers from the National College of Arts (NCA) to come up with international quality designs and products which were presented in a print catalog. So that was the start of Tribal Monsoon.

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The corporate boards play a crucial role in deciding the course of action of any corporation. Social responsibility of a company, being an essentially corporate matter, is also generally decided by its board. These very boards play a make or break role in incorporating good or faulty CSR strategies of a company. Of late, a heated debate on the role of corporate boards in CSR policy making has also started.

The politics of the boardroom have always remained a focus of the institutional investors. Proxy battles and board coups are the primary targets of these people but increasingly they have also started targeting a company’s social and environmental policies. Shareholders, on the other hand, are also not behind in pressurizing a company to be more socially responsible and active.

A recently released report found that the U.S. is still lagging behind its northern neighbor when it comes to the board’s involvement in CSR activities.

In the US, for the year 2005, 11% of the 100 largest publicly traded companies had committees that focus on social or public policies. In Canada, 44% of the largest 142 Canadian companies had committees that focused on CSR issues.

While the U.S. is still far behind but surely way ahead of developing countries. Although, Indian and especially Chinese CSR experts are making some waves by creating corporate awareness about socially responsible business regimen.

Under these changing global CSR perspectives, and as a Pakistani, one wonders what the Pakistani corporate boards are doing in this regard. After a little probing, I found that many Pakistani companies, or corporate boards to be more specific, are still pretty much oblivious of the role they have to play. There are some efforts to educate these folks about the importance of socially responsible business but no paradigm shift in corporate mindsets, barring a few, has been observed.

The general structure of Pakistani boards might be a culprit in this case. In most of the companies, you would find bureaucrats, both serving and retired, army officers and people of similar ilk massively represented in the corporate boards. These are the same people who (a) don’t have a knowledge of CSR and (b) if they do have some information, they still think charity as the best form of social responsibility. These people represent the old school of CSR and as there are hardly any CSR experts sitting on the companies’ boards, the so-called CSR activities of many Pakistani companies revolve around charity.

There is some light at the end of the tunnel, though. Some multinational as well as local companies have started expanding their CSR activities beyond charity. Organizations like Pakistan Center for Philanthropy and Responsible Business Initiative have played their due part in creating this awareness. The role of corporate boards of these companies in connection with the new CSR strategies is commendable as well. As these companies/boards have accepted the global shift in CSR strategies, we can hope that others will follow suit. At least we can hope for the better!

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This post reflects a young Danish-Pakistani’s craving for the sustainable and green energy options - Social Bridges

Like so many other countries, Pakistan has been burdened by an steeply increasing cost of petroleum. Costs of petrol, gas and diesel are rising like fire. It is becoming unbearable not only for the citizens but also for the country. Fortunately, we have got the solutions. Developing countries like ours should try to develop and promote biofuels production. Although we are blessed with ample resources, Pakistan is not utilizing them to produce biofuels though it should be considered because it will definitely have a long-term positive affect on not only our economy but also the environment.

Sugarcane is a major cash crop of Pakistan and we’ve a huge sugars production industry. We all know that sugarcane and corn are very important for the production of ethanol. As 80-85% of sugarcane is manufactured into sugar and a small amount into the brown one, not much remains for the production of ethanol because the importance of this as a biofuel is not being fully recognized in our country. The production level of ethanol was 2.89 million tonnes in 1991-1992 while in year 2003-2004, the production level reached 4 million tonnes. Despite the rise in production, Pakistan remains uncompetitive in the global biofuels market because a huge portion of it is exported to the western world.

Our annual import cost for oil runs into billions of dollars. If we substitute gasoline with bioethanol we can surely save a huge sum of money. This will result in a boost in our downward economy and will reduce the interest and loans. It’s a good news, however, that some people are actually exploring the avenues of biofuels in Pakistan as we have the resources. According to a report, Pakistan can save as much as $500 million in gasoline imports if it starts ethanol production on a bigger scale.

As discussed above, biofuels are green, becoming more and more competitive and can be a “hot” business in the coming years. If Pakistan takes up the challenge it has the potential to become Pakistan’s prime export-commodity. A very focused approached placed the tiny Denmark as the leading manufacturer of windmills and India as an IT-hub. This could be our golden chance. Will our leaders grab it?

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Nature-focused tourism or what is now known as Ecotourism is a new catch phrase in the dictionary of sustainability. Ecotourism, as we all know, is based on such type of recreational activities which are nature-centric and sustainable. It’s interesting to note, however, that there is a hot debate on the exact connotations of ecotourism. Some say that any type of tourism which doesn’t harm the environment and can improve the living standards of a society is ecotourism. Critics, on the contrary, have very strict rules on which type of tourism is ecological one and which is not. Aspects of green washing, environmental exploitation and human rights issues, among other things, mars the exact spirit of ecotourism.

Leaving intellectual discourse aside - to be discussed in another post, ecotourism is the new buzz word in the tourism industry. According to various estimates, the world ecotourism industry is growing at a rate of 10%-15% annually with expectations of much faster growth in years to come. There are many countries in the world who are earning a sizeable amount of their GDP from ecotourism. Even our neighbors like Nepal and India are exploring ecotourism opportunities on a huge scale. Nepal, specifically, is a success story in this case earning billions of dollars in tourism revenues. Same is the case with Sri Lanka and Maldives.

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The 2007 U.S. credit crunch that transformed into subprime mortgage crisis and economic meltdown is feared to become what is known as “The Great depression”. Under these circumstances, critics are slamming those companies who are sticking to their socially responsible practices raising questions about the loss in ‘profits’ because of CSR spending.

Dan Gray of Corporate Responsibility Matters has discussed in detail all the pros and cons of parting ways with CSR spending to limit losses. You can read his full post here but the conclusion is:

What will be really interesting to see is consumer reaction to a recession. As much as it will undoubtedly curb discretionary spending, it might equally provide a much needed drive towards more sustainable behaviours.

If it does, then the next economic upturn could be on a very different footing, and those companies that stay true to the cause will be well placed to reap the rewards.

Another take on the relationship between social responsibility and downward spiral of profits can be that if the ailing banks stop contributing towards the society then they would face double humiliation if they end up in FDIC control. Double humiliation because of their financial jeopardy and because of their lack of commitment towards the community they served in.

Non-profit organizations, on the contrary, seems pretty unscathed from the woes of subprime lowdown.

A slight cut in the CSR budget can be tolerated if your company is bearing the brunt of economic crisis but a total CSR blackout, as discussed above, can be highly counterproductive. So think before you leap (over the CSR spending!).

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As the saying goes - money is king, but some social entrepreneurs are trying to deplore this common myth. Some social entrepreneurs - especially those who don’t find supporting environment in their region/country - have started contemplating (though with different reasons) whether setting up social venture capital funds will actually end up as a helping hand or a bottleneck. It’s true that venture capitals are the driving force behind all things technological but social enterprise is an altogether different ball game. The risks are much higher and the profitability is lower.

This profitability is a major factor while setting up any social venture capital but the more important factors include the friendly business environment right from the government to the financial industry. By the way, this resource gives good pointers about the pros and cons of setting up social venture capital funds.

Social venture capital has yet to take roots in Asia and Africa - breeding grounds of poverty and also the best places to implement new ideas. These are the same regions which suffer from corruption, lack of proper financial organization and regulatory hiccups. Add to this the reluctant attitude of local entrepreneurs to step into the arena of social entrepreneurism. While social ventures are an excellent weapon of poverty reduction, the developing countries need help to implement viable strategies for social entrepreneurs.

The involvement of the governments on a larger scale is a must in the case of developing countries. A social entrepreneur, regardless of how much financial proficiency he has, will ultimately end up in a disaster if a country’s government acts dumb. Facilitating the local and international social entrepreneurs is the key to success if a government fails to ensure well-being of its citizens. Transparency is another issue social entrepreneurs face while working in the developing world. One has to keep the sheets clean if one is eyeing a funding from major social ventures like Acumen Fund or others. Often times these entrepreneurs end up in the same corruption frenzy hence casting a negative impact on the whole concept of social ventures.

The need of the hour is to establish a platform of the social entrepreneurs from both sides of the coin so that each can learn from others’ experiences. As the tilt of western social entrepreneurs is also towards the developing world so they can bring a significant change in the local mindsets. So any social entrepreneurs listening?

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Cellular revolution has taken Pakistan by storm. As the mobile density in Pakistan is reaching 56%, it’s high time that we dissect the prospects of cell phone-based social revolution in Pakistan. Mobile phones are increasingly being used as a social tool across the globe - as a weapon for the eradication of poverty and disease and as a sustainable option.

Pakistani cellular companies are also trying to catch on with this growing ‘cellular activism’ frenzy. It’s true that cellular companies have limited scope of action as far as brining social change is concerned still almost all the mobile companies of Pakistan are doing some kind of social uplift projects. Telenor, for instance, has launched a farmers’ uplift scheme - TeleKisan - besides the apnaPCO and other schemes. Similarly, other cellular companies are also conducting some activitis in the avenues of social uplift.

The responsibility, however, lies on the nonprofit sector and not the telcos. NPOs are the engines of social change in the developing countries. Mobile phones can be used as a foot soldier for social change if their use is extended beyond communications. NPOs can team up with the cellular companies to help providing technical knowledge to the farmers (National Rural Support Program is collaborating with Telenor in this case) or they can forge alliances with the medical community to provide free medical advice to those living in far off areas with limited resources. Some African nations are already making it big in what can be termed as cellular farming. The role of mobile phones in fighting against HIV/AIDS has already been discussed in one of our earlier posts.

Asia is not lagging behind as well. The success of Grameen in mobilizing people through ‘mobiles’ is known to all of us. Other networks like LIRNEasia are also doing commendable job in changing people’s lives by the use of cellular technology. International donor agencies are also eager to work with such organizations like LIRNEasia. Infact they are financing the whole project.

Microcredit organizations, as discussed above, are rapidly adopting cellular technology to enhance their footprint. Mobile phones are yet to be used for microfinancing in Pakistan though there are endless possibilities. To narrate an interesting fact, many small entrepreneurs, including women, have themselves understood the magic of cellular technology in expanding their businesses. They do face the shortage/availability of funds due to lack of financing but the cell phones are surely helping them in getting out of the tentacles of poverty.

Corporate sector too has a major role to play. Instead of simply doling out a few millions in charity, local corporate giants, along with the multinational conglomerates, should come forward with new ideas of using cellular technology for poverty alleviation. It’s ironic to note that when the whole world is eyeing profitability at the bottom of the pyramid by using cell phones, Pakistani corporate sector is still reluctant to accept the change. Cellular technology is ruling the roost so isn’t it the time to ‘cell’ the social change.

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Julian Wong is an established name in the international community of environmentalists and sustainability experts. He is currently working as a Fulbright Fellow at Tsinghua University in Beijing where he is writing extensively on China’s renewable energy industries in the form of his blog, Green Leap Forward. He previously worked as a private equity mergers & acquisitions attorney in New York and Hong Kong and was a member of the New York City Bar Association Energy Committee. Social Bridges arranged a special interview with Mr. Wong to know all about sustainability and greener options.

Social Bridges; You have academic and practical experience in green energy and environment related issues. When did this interest in environment and sustainability developed?

Julian Wong: About twenty years ago as a young kid. Various experiences shaped my ecological leanings, ranging from my religion (a Nature-perspective of God as the Creator of “all things bright and beautiful”), my mother’s emphasis on saving energy around the house, and witnessing the development of Asia first hand while trying to square that experience against the environmental movement from the West. If I had to name one triggering event made a deep impression on me, it would be leafing through the glossy pictures of Time Magazine when it named Endangered Earth as Planet of the Year.

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Beijing Olympics have finally come to an end and what a dazzling and spectacular ending it was. The 16-day sports extravaganza wiped off the fears of many environmentalists who were expecting some major disasters including possible boycotts. Now as the games are over, many environmentalists are examining the whole event with a ‘green’ magnifying glass.

Some have opined that the games were extraordinary, in the sense that the Chinese were finally successful in tumbling down many envirnomental concerns. Similarly, Beijing has gone green to a greater extent with recycling and renewable energy being the new force to reckon with. According to various reports, not only Beijing but many Chinese metropolises have seen an increased ‘green’ activity. Recycling, a shift towards renewable energy options and pollution control measures are being put into action. These ‘green’ revolution was not just for the Olympics but are part of a permanent environmental strategy.

Other critics are still weighing their options before presenting a final opinion. They think that the country has a long way to go before it claims a ‘green success’. Environmental pollution is still a big issue in China and limiting the use of automobiles is not the ultimate solution. Similarly, it’ll take a lot of time to totally clear the Peking skies. Human rights, on the other hand, has always remained a hot topic whenever anyone brings China into discussion.

Leaving criticism aside, China has done a great job in organizing such a mega event and that too with sustainability and greener options in mind. Maybe it’s time to learn lessons of green and CSR from China. Although the country is still struggling with environmental problems but overall it was a ‘good show’. Congratulations, China!

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