CSR in Singapore: Molding the nascent corporate social responsibility agenda in Singapore
CSR in Singapore — Corporate Social Responsibility is kind of a complementary approach to doing business in Singapore. The country is among the fastest-growing economies in the world and the ever-accelerating trend of sustainability reporting has caught up with Singapore as well.
Environmental concerns, social and societal issues are of importance with regards to carrying out sustainable business practices in Singapore. Much of CSR practices have traditionally been managed by the state in close collaboration with employers and unions. The government has been a significant player in Singapore’s economy and also the primary driver of CSR in the country. In fact, initially, public CSR disclosures were overseen primarily by the government and the National Trades Union Congress (NTUC).
CSR in Singapore: Story so far
The government has been responsible for setting the norm and tone for the implementation and development of CSR in Singapore, keeping in mind its own objectives, corporate aspirations as well as the targets of various industrial sectors.
Talking of the broad structure of Singapore’s CSR model, it initially started under the umbrella of the government and later grew into a hybrid movement that included varied stakeholders such as unions, trade bodies, quasi-government organizations. The government maintains just as much influence over the CSR structure so as to not overpower or overregulate it
“In short, the government can mold the CSR agenda to a certain extent, notwithstanding the transnational and rapidly evolving nature of CSR. At the same time, there is significant cooperation with the other key stakeholders, viz., employers and the trade union movement,” states a paper, The State of Play of CSR in Singapore, by Eugene K B Tan.
CSR in Singapore: Code of corporate governance
The code encourages domestic companies in Singapore to follow high standards. The emerging trend of sustainability reporting by Singapore companies and CSR in the mainstream prove that the environment is of utmost importance in the context of sustainable business practices.
Compliance with the Code is not mandatory but listed companies are required to disclose their corporate governance practices under the Singapore Exchange Listing Rules. The companies are required to explain any deviations from the Code in their annual reports for Annual General Meetings.
Take it more or less as the country’s CSR body or watchdog which deals with strategizing coherent policies, frameworks and ensuring synergy among various stakeholders. As mentioned previously, Singapore’s CSR mechanism has a tripartite core consisting of the government, the unions, and the employers. The government sets the ball rolling by providing policy framework, infrastructure, and resources required by the stakeholders to play their part in the country’s CSR movement.
Percentage of mandatory annual CSR funds
Companies in Singapore are subject to spending at least 2% of their average net profit during the three preceding years.
Singapore’s need to be ahead in its cause of globalization and international expansion has kept it aware of the changing CSR, sustainability trends. It is only obvious that a lack of knowledge or expertise in dealing with CSR issues may impede the country’s prospects and development. Singapore boasts of an environment that not only promotes ease of doing business but also the right amount of flexibility and autonomy.
Many a time, it was argued that Singapore did not enjoy as much CSR penetration as compared to other APAC countries or the western states primarily because some of the concerning areas, such as education and environment protection, were heavily invested into by the state, leaving not much room for the corporates to put up a show.
However, there is no such thing as too much CSR, is it?
Singapore is among economies that are driven toward understanding and evolving its CSR practice through focused business efforts, sound practices, and standards. The country has efficiently regulated, managed, and developed its CSR agenda spurred by the government’s strong backing.
Singapore’s CSR and sustainability agenda will remain ahead of the curve provided it continues to promote a business-friendly environment and work in tandem with all stakeholders. The country scores well in its approach of taking a pre-emptive approach in gaining an understanding of trends and changes concerning CSR and positioning its policies and regulations accordingly, having said that, the country also needs to put more effort into institutionalizing CSR.
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