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CSR (And MNCs) On Trial

Corporate social responsibility (CSR) is a big issue in China for many reasons – because it should be, because the market is developing and becoming more complex, because it is a defense against bad PR, and…because the government (via an NPC official) recently said that it is a requirement [1].

This message was re-iterated at the recent National People’s Congress where, as China CSR reports [2]:

This call to arms follows a government-driven initiative that was developed last year. China Development Brief noted at the time [3] that:

The article notes that the textile sector employs around 20 million people in thousands of enterprises, and that it has been a point of friction between China and the EU in the past (remember the “bra wars [4]”?).

China CSR has also reported [5]that the NDRC is supporting the initiative, and is targeting 10 textile groups for a trial, while also aiming to implement it in 100 key enterprises and 1,000 small firms.

Textiles is taking the lead, but other sectors are sure to follow, and foreign companies would be wise to review (or set up) CSR strategies, and to learn from the pain already suffered by companies like Apple [6]. Indeed, as this post goes live, news is coming in [7]that McDonald’s, KFC and Pizza Hut are all under investigation in Guangzhou for paying part-time workers at rates below the city’s new minimum wage – of RMB7.5 (US$0.97) an hour.

(Updated 3/4/07)