CSR or Charity? A personal story
Nguyen Quoc Qaung – s3246650
Corporate social responsibility (CSR) has been introduced into Vietnam by international companies for many years. And it has become a trendy concept for businesses to connect to society as well as build a code of conducts and corporate culture for their operations in market worldwide (Phi Tuan 2011, p. 20). However, in Vietnam CSR are usually understood as charity which is has different meaning and objective; and it has caused lots of troubles for corporations in order to transmit their message to the public. Thanks to the interview with Ms. Nguyen Hong Dieu who has long time experience in managing and conducting both CSR and charity events, this article, through the personal story of Dieu, is going to give a few insight into the practical distinctions between two term of activity in Vietnam currently.
What is CSR?
The definitions of CSR, according to Baker (2004) are variable based on how different organizations have framed it. However, there is a considerable common point between them which state about the positive impact on society produced by business processes of companies (Baker 2004). In short, as stated in the name, Corporate Social Responsibility represents the “responsibilities” that the corporations can do as a application towards society.
But is it all about the benefits of society? I guest not. Vogel (2005) has widened the concept of CSR as “the market of virtue” which describes a strong relationship between CSR and business’s profit. Furthermore, agreed with Vogel, Xueming & Bhattacharya (2006) pointed out that CSR can strongly contribute to the rise of business’s profit by increasing the customer satisfaction through environmental, social and ethical actions.
Back to the interview, Ms Dieu defined SCR as ‘‘a connection between the organization and the society in a long term’’. She also agreed that SCR goes along with business’s profit and branding as well as benefiting the society and its people. “It is a win-win situation when both businesses and society can get what they need during CSR campaign”, added Dieu.
According to Ms Dieu, there are two kinds of CSR: internal and external. Firstly, the internal CSR as she described as “a connection between people in a certain company or organization”, between employers and employees as well as between employees together. The internal SCR includes particular activities to improve the physical and moral life of companies’ members as well as improve the working condition of employees. Dieu then gave me an example of a food company offering a program to improve quality of meals for its factory workers. And the benefit of internal CSR? Of course it is the increase of sanctification among company’s members which lead to the improved performance of them. Secondly, the external CSR is what people usually think about CSR, “activities done by organizations to support and improve society as their appreciation towards their customers”, described Dieu. The objectives of external CSR includes building strong relationship and connection between organizations and society, improving brand image and reputation, increase customers’ satisfaction which leads to the improvement of sales, etc.
Charity and CSR
The basic action of CSR and charity is to help certain group of people for example the poors, the disabilities, difficult children, etc. However, when digging deeper, Ms Dieu pointed out some key different between two terms. First of all, according to Dieu “charity is like giving people the fish, while CSR will give them the fishing rod”. It means in her opinion, charity is just of a short term of help, while CSR is for longer term of improvement. Furthermore, as a person who used to mange and conduct many charity events in association with different charity group form France, U.S and China, Dieu shared that nowadays, charity events are losing their efficiency and meaningful purpose of helping people. For example, there are some people open poorhouses, then collect poor and disabled people to attract charity money from philanthropists inside and outside Vietnam. Dieu disappointedly added “For them opening poorhouse is a business opportunity. But that is not the big problem compared with what they have taught the poor kids to ask and even beg for more money from the philanthropists when they visit the poorhouses”. And for those two reasons, Dieu have lost her faith in charity.
Differentiating from charity, CSR has longer term objectives. “CSR is not only about helping people but also giving them opportunities to improve their lives by themselves”, said Dieu. Educating and changing people’s behaviors and attitudes are the things people cannot archive by charity events. Moreover, when a company or organization conducts CSR, beside caring about the society, they also pay much attention on how to build a positive brand image and reputation among community. Therefore, they usually do it very carefully and make sure that CSR can reach the people who really need it. “It is not only about giving money to poorhouses and then having no idea about what the money will be used for”, said Dieu. Another distinction, according to Ms Dieu is that the name of people who are doing charity should not be mentioned. In fact, there are lots of philanthropists are willing to donate and contribute for community without gaining any reputation for their own. They usually do it secretly of under anonymity. In contrast, when doing CSR, companies and organization usually seek for attentions from the public. Thus, according to Ms Dieu, one of the limitations of doing CSR is that businesses sometimes focus too much on kinds of activity which catch attentions of media and community more easily. “But we cannot blame businesses for that, they do meaningful things for the community and they needs something in return”, explained Dieu.
After involving in an interesting interview with Ms Nguyen Hong Dieu, I have changed the way I look at CSR. In the past, I used to feel negative about why businesses keep calling Corporate Social Responsibility while they actually do it for their own benefits. And I used to think charity is the better way to help difficult people. In the end of the interview, Dieu openly shared me her dream of managing and executing SCR by herself. She has lost faith in charity when seeing its negative impact on people especially children. She wants to give them fishing rods instead of fishes. That was the reason she with her job as a event manager assistant and then restaurant manager to enrolled in Profession Communications in RMIT Vietnam 4 years ago. She wanted to learn how to change the way people thinking and behaving through CSR. Now, after 1 year graduated from the university, she is running her own business as a distributor for Herbalife Vietnam to gain financial power for her dream of managing and executing CSR by herself in the future.
Baker, M 2004, ‘Corporate social responsibility – What does it mean?’, blog post, mallentbaker.net, 8 Jun, viewed 30 December 2012, <http://www.mallenbaker.net/csr/definition.php>.
Nguyen Hong Dieu 2012, interview, 30 December 2012.
Phi Tuan 2011, ‘Paving the Way for Sustainable Growth’, Saigon Times, 16 April, pp. 20-21.
Vogel, D 2005, ‘The Market for Virtue? The Business case for Corporate Social Responsibility’, California Management Review, vol. 47, no. 4.
Xueming, L & Bhattacharya CB 2006, ‘Corporate Social Responsibility, Customer Satisfaction, and Market Value’, Journal of Marketing, vol. 70, pp. 1-18.