Why CSR matters in new Myanmar

Sustainable development needs to include the three pillars of sustainability, as shown in the figure above. These must be given due consideration in formulating a holistic CSR strategy.
As the foreign investment law is debated in the Pyidaungsu Hluttaw, the press and in the business community in Myanmar, Western companies are preparing to return to the country they left more than a decade ago.
In the past 18 months, as Myanmar’s political system has changed from a military junta to a quasi-civilian government with a parliament, the international community has remained divided on how to respond to the actions of the government and unsure how to encourage political and economic openings in the country.
ASEAN and its member states, China, Japan and India have largely pursued a policy of “constructive engagement” and their businesses are well represented in the country. In contrast, companies from Western countries, most notably the United States, Canada, Australia, the United Kingdom and European Union, have not been able to work in and with Myanmar due to sanctions and the reputational risk they face from activists back home.
Today all this has changed. With the US government dropping more sanctions earlier this month, Western businesses are looking for Myanmar partners, Myanmr markets and Myanmar manufacturing bases for their products. They will act as competition to the established Asian and home-grown Myanmar companies, which have largely operated in a protected environment.
This is not only a threat but also an opportunity for Myanmar businesses and society more broadly. Many of the Western companies interested in Myanmar are heeding Daw Aung San Suu Kyi’s call for inclusive growth and are pledging to ensure their presence benefits wider Myanmar society. The magic words on everyone’s lips are “corporate social responsibility”, or CSR.
Business can serve as a powerful incentive to bring people together across different national and cultural lines, creating relationships based on a shared sense of identity and purpose, and overcoming differences that, in other spheres or across society as a whole, are often more difficult to surmount. These contributions can be made by companies of all forms: small and large, public and private, international and local. The first step of CSR is to bring businesses and wider society together with the aim of solving problems and improving lives.
How CSR is different in Myanmar
Myanmar already has a culture of established private and corporate philanthropy, normally in the form of donations to Buddhist institutions. This is strongly connected to the Buddhist culture of giving and subsequently attaining merit, however, and many of these CSR efforts are simply costs that do not help a company’s competitive situation.
This also appears to be changing. Today, there is heightened attention to CSR in the Myanmar business community. The Union of Myanmar Federation of Chambers of Commerce and Industry (UMFCCI) has taken note of CSR and is in conversations with civil society groups on how business can better benefit society.
This makes sense from a business perspective, too. For example, international investment funds that want to invest in local companies will take a strong look at existing CSR practices and partnerships as a means of assessing core set of values. Increasingly, where Myanmar companies now start forming partnerships with Western counterparts, a lack of corporate responsibility (social or otherwise) can lead to boycotts and termination of business arrangements.
UMFCCI is taking an active role in informing Myanmar companies about CSR. It realises the importance of strategic CSR in the three areas in which Myanmar companies will interact as the country enters a globalised world: trade, partnership and investment.
What are the benefits of strategic CSR to Myanmar companies?
In order to be competitive partners and to be seen as understanding the new globalised business environment, organisations need to create a CSR strategy with similar diligence and choices required in business strategy. While still “doing good”, strategic CSR helps them differentiate and become more competitive.
Strategic approaches to CSR move away from donations to individual projects, and creating coherence in activities that reinforce each other and benefit both the organisation and society. There are three clear reasons why strategic CSR is important for Myanmar. The organisations that do make the shift will succeed and prosper at the costs of those that don’t.
Firstly, any philanthropic activity (whether personal or corporate) from an accounting perspective is a cost. When the intent of doing good is aligned with the company’s business strategy, such as outcomes that benefit both the company and society, it has a positive feedback on the company’s performance. There are many examples from companies around the world that have had strategic CSR contribute to their bottom-line.
Secondly, any Western company coming and evaluating its partnering options in Myanmar will look beyond pure numbers to shared corporate values. Values are an indicator whether an alliance, partnership or merger will be a good strategic fit. Values differ from pure slogans in that they are things organisations have actually executed. An organisation that executes on its values (for example, on benefiting the environment and society) will typically have a CSR strategy supporting the claim. An organisation with an active and coherent CSR strategy would have demonstrated better cultural/value fit for business alliance than an organisation that just speaks about its values.
Thirdly, even if the Myanmar businesses are executing on their values, it’s important to couch their CSR strategy in terms and language that is understood by their partner. This is where the packaging of how to develop, evaluate and select an appropriate CSR strategy comes in.
Western organisations are extremely nervous when they extend their value chains into organisations in emerging markets, as they become susceptible to reputational risk. It’s harder for companies to hide. International civil society continues to innovate, employing increasingly sophisticated research-based advocacy.
Therefore, a coherent, professionally articulated, CSR strategy becomes a critical confidence-building measure in establishing new business relationships and trade.
Viren Lall is the founder of T&M Practice (www.tandmpractice.com), a not-for-profit organisation promoting excellence in transformation – be it business, individual or societal.

Source : http://www.mmtimes.com/index.php/opinion/2607-why-csr-matters-in-new-myanmar.html