Corporate Social Responsibility in China UGC272X Group : Number One Cheng Yu Hui Raymond Chau Winnie Wong Johanna Chan Du Guo Xin Victor Chen

CSR - Concerns in Asian Countries Financial stability Governance Climate change Poverty The spread of infectious diseases Widespread corruption

Against CSRFor CSR  Busy surviving hard times  Money spent on CSR by managers is theft of the rightful property of the owners  The most effective business leaders don't waste time with CSR  The responsibility of the politicians, not corporations  Attract the attention of international investors  Access to markets with higher levels of regulation  Allow civil society and consumers to better understand their business  Attach and retain the right talent  Business and CSR can go hand in hand

China Mobile leading industry players in the mobile communications “In our first Corporate Social Responsibility (CSR) Report released in 2006, we clearly stated our CSR vision, reported on our CSR performance, and committed to fulfilling our responsibilities and striving for pre-eminence. In 2007, we have actively undertaken four major CSR programs in accordance to the theme Growing Together Harmoniously and in line with stakeholder expectations.” - Mr. WANG Jianzhou, Chairman and Chief Executive Officer of China Mobile

CSR Strategy Economic responsibility Social responsibility Environmental responsibility CSR Management system

How China Mobile benefit from CSR? (Industry-based View) CSR as a source of differentiation -China Mobile made community investments on Infrastructure, education and cultural protection activities. =>CSR as a long term investment to enhance its reputation and differentiate itself from their rivals. CSR as a source of opportunity -China Mobile has help set up communication network and popularize mobile services in rural areas =>CSR as an opportunity to create a new market.

How China Mobile benefit from CSR? (Resource-based view) CSR as a source of added value -Energy saving technologies => Cut operational costs and also build a reputation as a environmental conscious company. CSR as a source of rarity -Specialized operations to meet strict electromagnetic emission regulations in China. => Take advantage of CSR to make it difficult for rivals to imitate and compete China Mobile has been so success in incorporating CSR into their business model mainly because of its organization abilities.

Accommodative Strategy “In line with our core value: Responsibility Makes Perfection, we endeavor to fulfill our economic, social and environmental responsibilities, in pursuit of a harmonious growth with industry, society and the environment” Institution-Based Considerations

Institutional Framework Formal Institutions –Laws and regulations (Chinese labor laws, electromagnetic fields (EMF) management, “Electromagnetic Environmental Health Standards” ) –Regulations (reduce energy consumption for each unit of GDP by 20% by the year 2010) –Rules (code of ethics and anti-corruption system) Informal Institutions –Normative pillar Industry norm to incorporate CSR –Cognitive pillar Became a social obligation Build an employee volunteering organization, create employee volunteering opportunities with company support and incentives

Future Trend:China Mobile’s CSR Policy  Proactive Strategy (goes beyond responsibilities) –Comprehensive 3-year plan –Create communication platforms to engage stakeholders –Participate in local and global CSR discussions –Establish a world class CSR management system

Debate: an organization’s accountability to its primary stakeholders US$ 2.5 billion to establish networks to remote villages in China profit-maximizing organizations; act in the interest of its owners Global sustainability primary and secondary stakeholders –reduce the consumption of energy

Conclusion CSR is a rising trend Reduce business risk Attract attention China Mobile advocates “Responsibility Makes Perfection” Industry-, Resource-, Institution-based views  Private profits & Public welfare can be achieved together