CSR in Korea or in Developing World
Whatever you call it, CSR has not been a familiar term among Korean businesses. If there has been anything related with CSR, it was called something similar to “ethical management”. To many Koreans, this term connotes the initiatives that a company is taking to express its commitment to complying with regulations and rules of free market economy doing their business. Traditionally, these efforts have been focused on what we call in class as internal CSR: governance structure, employee treatment, and etc.
Since 1960s, Companies in Korea, just like any companies under any authoritarian developmental political regime, has grown through close partnership with the government. Under a strong control of financial market by the government, the financial investments were allocated to companies of government’s choice. We all know what this normally entails on business side: corrupt relationship with political circle, skewed distribution of opportunities and wealth, lack of transparency about companies’ management, feudal ownership structure, etc. Therefore, just like military political regime, businesses have often been associated with something negative.
Since the democratization of the society around late 80s, civil actions have gotten very active against these internal business practices. “Ethical management” was the passive answer from conglomerates to these voices. However, the family-ownership and lack of transparency still intact (see Samsung ex-chairman’s comeback story at http://www.cnbc.com/id/36011196), hardly anyone views Korean companies are better in their ethical standard.
Now, according to my short research, it seems Korean companies are gradually adopting a term “responsible management”. In our language, this term has the implication that is more proactive than just being “ethical”. Whatever the reason is (some says this is because of foreign market and foreign investors), I think this trend is linked with a newly opening “opportunity” both for companies and for other organizations that are interested in changing the world through the power of market.
For companies: CSR is a great strategic platform to enhance their brand against competitors and toward general public. If internal issues like ownership structure are something too sticky to change in the short term, there is wide horizon of externally responsible management – e.g. environmental and social commitments – that companies can tap on. While trying to fix/enhance their internal practices, companies can build connection with connection with the public in a differentiated way through efforts for environmental and social responsibility. As their foreign presence increases, these efforts are getting more and more important.
For third party organizations: Yes, corporations still have internal issues and it is very important that they are reformed. But it is not the only issue. Leveraging companies’ efforts to make up for their negative image, these organizations can expedite the positive environmental and social impact that companies can potentially make. There are virtually no non-governmental organizations that collaborate with companies for this purpose. The chance is widely opening now.
—Sehoon
