CSR as a Government Requirement

“Do you think the government should require companies to have CSR programs?”  This was a question raised in one of our MBA-CSR sessions.  Personally, I don’t think this should be a government requirement.  Corporate Social Responsibility (CSR) programs should be sincerely and voluntarily implemented, rather than being forced to business organizations. 

In 2013, House Bill (HB) 306 was introduced by the former president, Gloria Macapacal Arroyo, as well as her son, Diosdado “Dado” Macapagal Arroyo.   This act is known as “Corporate Social Responsibility Act of 2013”, “an act encouraging corporate social responsibility, providing incentives therefor, and for other purposes”.  Under this bill, companies are encouraged, not required, to voluntarily contribute to sustainable economic development.  Section 43 of Batas Pambansa Blg 68, or the “Corporation Code of the Philippines” was amended as follows: “Stock corporations are prohibited from retaining surplus profits in excess of one hundred (100%) percent of their paid-in capital stock, except: (1) when justified by definite corporate expansion OR CORPORATE SOCIAL RESPONSIBILITY projects and programs approved by the board of directors…”.  Under this bill, the state shall “give national recognition and rewards to all business organizations for outstanding, innovative and world-class CSR-related services, projects and programs;”  spending for these CSR programs are also be entitled to full deductibility from gross income; local government units can provide assistance “necessary for business organizations to perform their CSR;” and that “all business organizations shall submit the list of their CSR activities as part of their annual or regular report to the Securities and Exchange Commission, the Department of Trade and Industry, or the Department of Finance.” 

When I first read about this HB, I was pleased that the government is actually promoting CSR to local organizations.  But on the second thought, I felt that there’s an underlying agenda on this HB, probably because of my bias on the authors of this HB.  As the public knows, our former president faced various plunder and graft cases.  And yet, I find it ironic that they are actually authoring this HB.  CSR, as I have learned in my MBA-CSR class, is how companies contribute to society through good business practice.  But have the authors of this HB done a responsible government practice during their term?  If the plunder and graft cases were true, how confident are we that this HB will be applied by the companies responsibly?  How good is the intention of the authors?  In this HB, companies can already use its CSR projects as a justification for retaining their surplus profits.  Should the companies exceed their surplus profits beyond their paid-in capital stock, and these are not justified, they will be subjected to certain taxes and penalties.  Because of my bias on the authors of this HB, I believe that this will just be used for some forms of concealment and tax avoidance.   

The HB also mentioned (but not limited to) the following activities as forms of CSR activities: “charitable programs and projects, scientific research, youth and sports development, cultural or educational promotion, services to veterans and senior citizens, social welfare, environmental sustainability, health development, disaster relief and assistance, and employee and worker welfare related CSR activities.”  CSR in general, should not be an exclusive project only, and it should form part of the company’s daily operations.  On accounting perspective, I find it hard how to distinguish the costs between CSR and non-CSR programs, particularly for organizations who are already embedding CSR in their core business operations.  Providing a safe workplace and fair compensation to employees are already forms of CSR.  Will our local government consider these as CSR activities as well?  CSR, based on one of the videos that we have watched in class, is how companies earn profits, and not how they spend it.  With this bill, the people will continue to perceive CSR otherwise, and be misled to believe that CSR is how companies spend money (on charitable or philanthropic giving), and not how they responsibly earn their profits.

PWD in the Workplace

Based on Philippine Statistics Authority’s 2010 Census of Population and Housing, the rate of Persons with disabilities (PWDs) in the population have increased from 1.23% (0.9m) in 2000 to 1.57% (1.4m) in 2010.  About 59% of the PWDs belong to the working age group, 18.9% for 0-14 age range, and 22.1% from the retirement age group.  While the largest chunk of PWD’s population are in the working age group, PWDs are often deprived of getting good and stable jobs, not just in the Philippines, but in other countries as well.  There’s a very few company I know that really open their doors and offer employment to PWDs.  In my 12 years of employment, I have worked for 5 companies already and only 2 of them have open positions for PWDs.   My third employer’s parent company hired an orthopedic-disabled receptionist.  The President strategically placed her in the front line to convey equality among the individuals.  Compared with other receptionists that I have met, she indeed had the sincerest morning greeting, which will definitely lighten up your mood the entire day.  My fourth employer, which promotes diversity in the workplace, also hired an orthopedic-disabled manager.  Except for their legs, the rest of their body parts are functioning well.  Their disabilities do not serve as barriers in communicating with their colleagues.

However, Lamoiyan’s manpower model is an exceptional one.  Lamoiyan is known for manufacturing the local toothpaste – Hapee.  In its manufacturing plant, 35% of Lamoiyan’s workforce are hearing-impaired.  Unlike 2 of my previous employers who hired a small percentage of PWDs, Lamoiyan’s PWD population is quite significant.  I’m also an employee of a manufacturing company, and I’m really impressed how Lamoiyan was able to embed this special program in its production process.  Miscommunication is already one of the most common problems in the workplace, even for physically normal people.  But despite this norm, Lamoiyan took a big leap in giving decent jobs to hearing-impaired employees.  It made me realize that his operations model is really sustainable, particularly for a manufacturing company.  Our company manufactures semiconductors, and I believe we have some jobs that are suitable for hearing-impaired employees as well.  As mentioned in Lamoiyan’s case, one of the strengths of hearing-impaired employees is the attention to details.  This strength can also be used by our company for some processes like manual visual inspection (MVI), a form of quality check. 

Lamoiyan proved that PWDs can be given equal opportunities with the normal people.  I guess two of the hindrances in our country are the government policies and local infrastructures.  Even for normal people, there’s already a high unemployment rate and a high competition in getting a job.  Scarcity of jobs is not only a problem of PWDs, but of normal workforce as well.  Should the government give more job opportunities to PWDs, the next concern is – do we have a PWD-friendly infrastructure and transport system?  Even there are available jobs, the system will not work well if we do not have a good infrastructure for PWDs.  One model that the local government can implement is Swedish Government’s disability policy, with special priorities on the justice system, transportation and IT.  In terms of transportation, “Swedish government has instructed the country’s municipalities to initiate moves to make facilities such as bus and tram stops more accessible,” wherein all citizens, both normal and PWDs, can “work, study, and take part in community activities on equal terms.”  In terms of IT, Sweden’s national IT strategy was to give new IT tools to PWDs, to promote a “greater degree of independence.” In order to provide more equal opportunities to Swedish citizens, the government also provides municipal grants to PWDs for housing modifications, car allowance and subsidies, funding for job hunting, financial assistance from Swedish Social Insurance Agency, and a lot more.  Philippines may still be very far from this ideal state, but it’s not too late to start with small steps to implement changes and improvements in the lives of Filipino PWDs.

(1)    Sweden’s disability policy.  Retrieved from https://sweden.se/society/swedens-disability-policy/

Women and Advertising Ethics

Nike, Adidas and other sports brands portray their women endorsers as strong and fit women.  This has probably evolved from 1980’s and earlier years wherein the sports advertisements are mostly endorsed by men athletes.  As a woman, it is flattering that the market is now less gender-discriminating, and is now recognizing and widely accepting women as sports endorsers.  However, it is also disappointing to know that some advertisers don’t respect the sacredness of women’s body.  Some companies are using women as sex objects, and not as endorsers per se.  There are also instances wherein the use of women as endorsers does not have any connection with the product. 

For instance, women endorsers and alcohol products.  The 2003 World Health Survey (Philippines) showed that 1.7% and 0.5% of the survey population are male and female heavy/hazardous drinkers, respectively; 13.2% and 1.6% are male and female episodic drinkers, respectively; and that out of 41.6% youth drinkers, 61.2% are males, while 23.9% are females (1) .  Given these statistics, men in general, are the target market of alcohol companies.  However, in their advertisements, women are more often used as alcohol endorsers, which they traditionally call as “calendar girls.”   And if you were to assess these women, they don’t like they are heavy drinkers either.   These women are more likely used as sex objects than actual endorsers of their products.  As a mother, I think I would be struggling if my son would ask me why are those sexy women used for calendars.  How would I explain the rationale behind it to a six-year-old boy?  As much as I want to shield my sons from some photos or advertisements that would possibly pollute their minds, it is really inevitable since they always pass by EDSA and C5, crowded with a lot of these materials. 

Aside from using women as sex objects in advertisements, other advertisers excessively manipulate the image of a woman and her body.  In Vatican’s paper on ethics in advertising, the first moral principle mentioned was the “truthfulness in advertising”.  Advertisements, magazines, social media and other publication do a lot of fabrication of women’s images, and most often, an exaggerated one.  As influenced by these advertisements, women tend to be too idealistic, and sometimes lead to lower self-esteem, anxiety, eating disorders, and living beyond their means.  There’s nothing wrong celebrating the beauty of women, but what’s wrong with some advertisements is when they deliberately distort the reality and mislead the audience.  Pope John Paul II noted that advertising can be a tool of the “phenomenon of consumerism” and that “it is not wrong to want to live better; what is wrong is a style of life which is presumed to be better when it is directed toward “having” rather than “being” (1).   Instead of appreciating God’s natural gift of beauty, some women tend become someone that they are not.  Women, even the young girls, are pressuring themselves to look better and become thinner, as they compare their bodies with the models appearing in advertisements and magazines. It’s good that some organizations are driving some changes in how media portrays its endorsers.  Change.Org for instance, started a campaign to “create positive change for young women by reducing photoshop in magazines.” (2)  According to the organization, the extreme post-production editing of images elevate the problem especially for young women.  Post-production edits portray too ideal bodies, which create high insecurities among women.  In one study for instance, “75% of ‘normal’ weight women think they are overweight and 90% of women overestimate their body size.” (3) Some women resort to excessive weight reduction and worse, health problems.  I do hope Change.Org’s campaign will become more popular, and that more celebrities will be ambassadors for these changes.  One good example was Kate Winslet, the famous “Rose” in the movie Titanic.  Before she turned 40 last year, she posted a make-up free picture in Facebook, urging her followers to “embrace who they are, including their perceived flaws.”(5)  If celebrities were used to influence the public to look flawless, celebrities can also be used to change mindset of the public, on how to perceive the real beauty and embracing their flaws. 

More than the celebrity endorsers, the main responsibility lies with the companies, followed by the advertisers and regulating bodies.  The companies and their contracted advertisers should respect the dignity of the endorsers, their target market, as well as the general public.  The regulating bodies on the other hand, particularly here in the Philippines, should revisit their guidelines when it comes to advertising ethics.  Lastly, the public audience, should take active participation in communicating to the government or regulatory bodies if some advertisements are offensive. 

(1)    Retrieved from http://www.who.int/substance_abuse/publications/en/philippines.pdf

(2)    Retrieved from http://www.vatican.va/roman_curia/pontifical_councils/pccs/documents/rc_pc_pccs_doc_22021997_ethics-in-ad_en.html

(3)    Retrieved from https://www.change.org/p/reduce-photoshop-in-magazines-to-create-a-better-world-for-girls

(4)    Retrieved from http://www.healthyplace.com/eating-disorders/articles/eating-disorders-body-image-and-advertising/

(5)    Retrieved from http://www.mirror.co.uk/3am/celebrity-news/kate-winslet-goes-make-up-6341038