Making shared prosperity happen

October 25, 2022
Managing for Society
The Manila Times

De La Salle University’s School of Lifelong Learning and the League of Corporate Foundations’ CSR Institute have partnered to run a pioneering 6-module online training program this November entitled “Philippine CSR Reloaded! Implementing the Covenant for Shared Prosperity.” The program will include modules on “The Covenant for Shared Prosperity: Program Planning and Implementation (November 15 and 16)”, “Implementing Action Research for Shared Prosperity” (November 22 and 23), “Program Evaluation and Impact Measurement” (November 28 and 29), “Communicating Your CSR and Sustainability Vision” (January 10 and 11), “Stakeholder Analysis and Engagement” (January 17 and 18), and “ESG Reporting for Shared Prosperity” (January 24 and 25).

When two dozen business organizations launched the Covenant for Shared Prosperity in November 2020, a message was sent that the time for “business as usual” was over. Especially after the devastating effects of the pandemic on the economy as well as the lives of ordinary Filipinos, business leaders acknowledged the need to step up their game in terms of uplifting the lives of the various stakeholders of their companies in order to build a more resilient economy and society. 

The SEC’s 2019 “Code of Governance for Publicly-listed Companies” explains that stakeholders include “any individual, organization or society at large who can either affect and/or be affected by the company’s strategies, policies, business decisions and operations, in general. This includes, among others, customers, creditors, employees, suppliers, investors, as well as the government and community in which it operates.”

The CSR movement has been around in the country for at least two decades. President Arroyo proclaimed the first week of July as National CSR Week in 2002.  Since then, more and more of the leading companies have been showcasing their CSR programs in their annual reports.  The SEC released sustainability reporting guidelines for public companies in 2019 and more than 90% have been submitting reports.  In fact, many comply with international reporting standards covering various aspects of social responsibility and sustainability such as the Global Reporting Initiative and the Integrated Reporting Framework.

Disappointingly, the level of inequality in the country increased noticeably during the same period that CSR has been a popular buzzword in the corporate world.  Since 2000, the number of Filipinos listed in the annual Forbes list of dollar billionaires increased from three to 21! Meanwhile, the World Bank reported that the Philippines had the slowest growth in the middle class in the region; below Malaysia, Thailand, Indonesia, and, get this, even Vietnam.

Since the companies already have a lot of CSR activities going on, the “Philippine CSR Reloaded!” training program aims to focus more on shifting the mindset of business leaders and applying this new thinking to maximize the inclusive impact of the CSR movement. 

The first necessary mindset shift is to think of workers not as expense objects in an income statement but as humans with talents and their own dreams that can be harnessed for value creation.  The second shift is from the “either-or” mindset -- which pits the needs of stakeholders like employees against those of investors -- to a “both-and” mindset which achieves benefits simultaneously among all stakeholders.  Anne Mulcahy, Chairman and Chief Executive Officer of Xerox Corporation, took the helm in 2001 when the company was nearly bankrupt, had over $17 billion in debt, and had six years of losses. led the turnaround of the company.  She managed to turn the company around by working with all the stakeholders to reduce expenses and keep employees engaged in continuous innovation even though many of their former colleagues accepted losing their jobs to keep the company afloat.  Mulcahy explained that “…business success and business ethics are not mutually exclusive. In fact, we believe they are synergistic. … A Harvard study, for example, found that companies that balanced the concerns of employees, customers, shareholders, and society, grew at four times the rate of companies that focused solely on shareholder value.”

Our country can definitely grow the middle class as fast as our neighboring countries have achieved if business leaders master the engagement of all stakeholders for innovation and value creation while ensuring that everyone gets a fair share of the benefits.  Let’s make this happen together.

Dr. Benito Teehankee is the Jose E. Cuisia Professor of Business Ethics at De La Salle University.  Those interested in the Philippine CSR Reloaded! program may email him at benito.teehankee@dlsu.edu.ph