Describe and analyze CSR efforts of a company that you can freely choose. How do these CSR efforts link to the attached Economist article?

This paper examines the Corporate Social Responsibility efforts of HSBC to the environment, people and community.

HSBC is one company that believes long term success and good corporate behavior are linked. Thus CSR has been an important and essential ingredient in HSBC’s 140 years of success.

HSBC manages environmental issues as part of their business. It is helping to tackle climate changes by being the first major bank to go carbon neutral with its Carbon Management Plan. The plan consists of three parts: to manage and reduce their direct emissions, to reduce carbon intensity of electricity they use by buying ‘green electricity’ where feasible and to offset remaining emissions in order to achieve carbon neutrality. As at December 2005, HSBC has reduced its overall energy usage by 5%, thereby reducing its carbon dioxide emissions from energy use. This is due to improvements in carbon management practices, investigating use of renewable resources and use of energy-efficient and cost-saving equipment. (HSBC Environment targets section, para. 1) HSBC also showed a reduction of 1% in their water consumption at year-end 2005 through initiatives like installing switch-off devices, improving operations in water management and better control of cooling towers. (HSBC Environment targets section, para. 2)The environmental regulation and information disclosure by the company can benefit them to a large extent, as the company march their way to Product Stewardship, the second stage of development of green management process. Though these policies lower the economic efficiency of the business by increasing its cost, resulting in lower profits, it gives them a comparative advantage to other businesses in the same industry. By reducing pollution and operating with greater energy efficient, it can reap significant cost savings. The cultivation in the vision of sustainability can help HSBC adopt sophisticated strategic planning to allow their top managers assess the full range of the firm’s effect on the environment. These planning can thus help the company foresee new markets, materials and technology.

HSBC embraces diversity. It employs people from different cultures; different points of views on disciplines as they think that their diversity profile at all levels of the business should reflect that of their customers. It believes that having respect for all people inspires loyalty in both employees and customers. (HSBC Embracing diversity section, para. 1)Their commitment to diversity starts from its board of directors as it has three female directors, more than most of the world’s leading companies. In addition, one principle HSBC holds is fair pay to its employees, where the pay and promotion is based on individual performance and capabilities. It shares the benefits of its success through performance-related bonuses in most regions and the extension of share ownership. About half of all HSBC employees now participate in one or more of HSBC’s employee share plans. (HSBC Pay and reward section, para. 2)

By having diversity practices, HSBC has a strategic advantage because it is able to attract and retain talented workers from all backgrounds, serve a diverse customer base and avoid expensive lawsuits and public embarrassment. Having a fair pay policy helps persuade and encourage its employees that there is ‘distributive justice within the company’, as pay and promotion is due to meritocracy. Though these efforts create a fairer level of playing field, HSBC should continue to improve and maintain its policies as discrimination will always be on the list. Health and safety issues should also be taken seriously with the death of one worker in its workplace in 2005 (HSBC Health and safety section, para. 7) so as to be socially responsible to its stakeholders and weigh off the argument that that a firm places more responsibility on business rather than individuals.

HSBC takes importance in nurturing talent by providing the young talented people with scholarships. In United States of America, a US$1 million grant was given to the United Negro College Fund/HSBC Corporate Scholars Program to provide students with funding for college tuition as well as paid summer internships at HSBC offices in the US. (HSBC, 2005) HSBC’s employees also contribute back to the society through volunteering and fund raising. One example can be seen from HSBC Singapore's Senior Management Team climbing Southeast Asia's highest peak Mount Kinabalu to raise a total of over SGD 450,000 for needy schoolchildren in Singapore. (HSBC employees in the community section, para. 7) Lastly, HSBC engages its stakeholders like customers, investors and suppliers through forums, surveys and feedbacks to gain more insights for improvement and to understand the expectations people have on its business and CSR. (HSBC, 2005)

Community involvement, philanthropic contributions and engagement with stakeholders help to cement the loyalty of employees, customers and employees. They also help enhance its reputation and show its ability to respond quickly to changing stakeholders demand. The CSR efforts put in is very beneficial as needy people receive hope through this help, while firms got to build its social capital and show its strong stakeholder engagement in a proactive way. Dense social network increase productivity by reducing the costs in business, as company and people are more likely to trust one another. The development of social capital produces a win-win outcome as everyone becomes better off.

Overall the CSR efforts HSBC puts in may be due to the influence it possesses. Thus it may feel obliged to the iron law of responsibility, where it believes that responsibility must accompany with power. Otherwise, it may lose the power. By committing in social responsibility, social initiatives by business can promote long-term business profits. These can be seen in the donation it gives to the United Negro College Fund/HSBC Corporate Scholars Program above-mentioned. This ‘corporate gift’ though costly in the present, might in time provide a flow of talented graduates to work for the company. The CSR efforts also help to improve its business values and the firm’s reputation. The social reputation of the firm is an important factor in building trust with its stakeholders. It prompts consumers to come back to do business with them, attract and retain employees to spur productivity and enhance profitability. Thus the reputation with respect to the CSR efforts put in is positive. And this is why companies view CSR so importantly. This goes in accordance with the Economist article (2005) that states “businesses certainly need to take account of other interested parties if they are to succeed as businesses: they must satisfy their customers, get on with their suppliers, motivate their workers, and so forth.”

Yet, the CSR efforts HSBC invests in may not be fruitful. As it uses its resources for social purposes, it risks lowering efficiency. This is because those resources could have been put into better use in other important areas that could increase the efficiency of the company. By pursuing social goals, the firm deprives society of important goods and services, and the higher levels of economic production needed to maintain everyone’s standard of living. The low efficiency may thus induce higher cost, resulting in lower profits and returns in investment. This will make it more difficult for the firm to acquire additional capital for future growth. In the long run, the company’s CSR efforts may backfire.

The article also argues against CSR efforts. It feels that a proper business of business is business. Committing in CSR may give rise to confusion over business ethics and what the managers’ responsibilities are. Managers are employed by the company to maximize long-term value of the owners’ asset. The CSR efforts shown meant that assets of the owners are put into other uses. This means cheating the owners and is unethical. Thus managers should not concern themselves with the public good as they are not competent to do it and may lack the democratic credentials for it. (Anonymous, 2005) So if they are to manage those social responsibilities, which are not within their professional capacity, with office work, other than being unethical, it may result in lower efficiency of business. Hence it feels that it is the government that should be accountable to all citizens. It is their jobs to deal with economic and social problems. (Anonymous, 2005) So the CSR efforts should be left to other groups in society and business should stick strictly to making profits.

Though there are lots of criticisms against CSR by firms, HSBC has been a good corporate citizen, showing its responsibility to the environment, people and community. However, there are still rooms for improvement and these can be achieved together with the help of its stakeholders and its enlightened self-interest.

Argument on article Lifeboat Ethics: the Case Against Helping the Poor

In the article Lifeboat Ethics: the Case Against Helping the Poor, Garrett Hardin’s main argument is that we should not help the poor.

The article starts by describing the difference between the spaceship ethic, which is where we should share resources because all needs and shares are equal, and the lifeboat ethic, we should not share our resources and using this ethic we should not help the poor. He argues because of limited resources, tragedy of commons and no true world government to control reproduction and use of available resources, we should govern our actions by the ethics of lifeboat.

The main argument is as follows:
1. If we have limited resources, then we should govern our actions by ethics of lifeboat and not share our resources.
2. We have limited resources.
C3> We should govern our actions by ethics of lifeboat and not share our resources.
4. Since we should govern our actions by ethics of lifeboat and not share resources, the poor will suffer if we do not help them.
5. Lifeboat ethic advocates that we should not help the poor.
C6> We should not help the poor.
The above argument looks valid. So let us examine whether the premises are sound.

In premise 1, this premise is argued for under ‘Adrift in a Moral Sea’. Assuming a lifeboat with an excess capacity of 10 more passengers, those in the boat should assess whether they should admit 10 more people to it if the excess capacity acts as a safety factor. Its argument is as follows:
1. If we have no one on the lifeboat, then we have safety factor.
2. If we have safety factor, then there will not be disastrous outcome.
C3> If we have no one on the life boat, then there will not be disastrous outcome.
C4> If we have no one on the life boat, then survival is possible.
5. If survival is not possible by undermining the disastrous outcomes from the unforeseen circumstances with excess passengers, then the boat will sink.
6. If the boat sinks, then we should not aid the poor in the waters.
C7> If survival is not possible by undermining the disastrous outcomes from the unforeseen circumstances with excess passengers, then we should not help the poor.
8. Survival may not be possible by undermining the disastrous outcomes from the unforeseen circumstances with excess passengers.
C9> We should not help the poor.
It follows that this sub-argument supports the main argument. This argument is valid due to its argument form DS and MP. Indeed the ‘safety factor’ is an important factor on the lifeboat and if we were to admit more people on the boat, survival may not be possible. Therefore this sub-argument is sound.

In ‘Population Control the Crude Way, it is reconstructed as follows:
1. If the poor can always draw on a World Food Bank in times of need, their population can continue to grow unchecked.
2. If population continues to grow unchecked, their need for aid will also increase.
C3> If the poor can always draw on a World Food Bank in times of need, their need for aid will also increase.
4. If need for aid increases, the World Food Bank will have less resources.
C5> If the poor can always draw on a World Food Bank in times of need, the World Food Bank will have fewer resources.
C6> We should not help the poor.
This sub-argument supports the main argument. The argument is valid. However, there is an assumption to premise (4) that the poor will take and give nothing in return, which is not true. As from the article, the poor will give by being cheap labor and there will be political gains between countries, hence resulting in a charity gain. There is another assumption that giving more aid will increase more people, thus increasing the needs for more aid. But this may not be true. Once giving the poor the food, they can go look for a job rather than waiting for food. By looking for a job and earn money, they will be richer. If they are richer, they will require less need. Thus increasing the aid does not mean increasing the need for aid. In addition, Premise (1) may not be true such that when population is high, it will grow unchecked. It makes no sense that we know reproduction of rich is still lower than poor countries. With the poor receiving more aid, they will become wealthier. When a country becomes wealthier, it does not mean that the state of reproduction will stay at same rate. Yet, reproduction of rich is still lower than poor countries. Therefore the higher rate in population does not equal to an increase in need for aid. The argument is unsound.

In Immigration vs Food Supply, it is argued for:
1. Immigrants consist of the poor.
2. Immigration is supported.
3. If the primary interest to support unimpeded immigration is the desire of employers for cheap labor, we should close the door to immigrants.
4. Foreigners were brought in to work at wretched job with wretched pay.
C5> We should close the doors of immigrants.
C6> We should not help the poor.
Though the argument is valid, this argument does not really link back to the main argument. This argument talks about not helping the poor because of the poor conditions they’ll be in if immigration is not allowed. It does not talk about anything near to the lifeboat ethics. Moreover, the premises (3) and (4) in this argument have some flaws and seem to commit the fallacy of argument against the person by appeal to explanation. Premise (4) is questionable. We do not really know whether foreigners or immigrants were cheap labor, working in a state of bad job conditions. Therefore this argument is unsound.

In Premise 4, this premise is argued for under ‘Population control the Crude Way’. It argues that:
1. The proportion of people in rich and poor countries will stabilize and less poor will suffer only if we aid the poor through the system of food sharing.
2. The growth differential between the rich and poor countries continues to increase.
C3> We should not aid the poor.
In this sub-argument, it supports the main argument. The argument is valid as from the argument form. Yet, this argument does not seem sound. (1) may not be true. Even with some system of food sharing or foreign-aid programs to the poor countries, the rate of population between the rich and poor countries still continue to increase, with a worse ratio each year. So if this premise is false, then this entire sub-argument becomes unsound.

Under ‘Learning the Hard Way’, it says that even though we aid the poor, the poor will still suffer unless they learn from experience and mend their ways. In other words it means that the poor will not suffer only if they learn from experience and mend their ways. Learning from experience and mending their ways means that poor countries should not be dependent on other countries to help them. Therefore for the poor not to suffer, we should not help them. This sub-argument supports the main conclusion. Yet this sub-argument seems to contradict with the Premise (4) in the main argument. Here the sub-argument says that ‘If we do not help the poor, they will benefit’ whereas in the Premise (4) of main argument, it says that ‘If we do not help the poor, they will suffer’. These two statements seem to contradict. If the sub-argument’s one is true, then Premise (4) of main argument is false. If the premise of main argument is false, then the main argument is invalid.

In conclusion, Hardin’s argument is invalid and unsound. His 1st premise is challenged to be untrue and is unsound by weaknesses and fallacies like argument against person by appeal to explanation. His 4th premise has been proven untrue and unsound. So most of the sub-arguments are rendered unsound though its first sub-argument of survival in the lifeboat is possible if we don’t help the poor is sound. Hence, the support for lifeboat ethics is not very strong to prove that we should not help the poor.

Confounding the myths of Creativity within me

I always thought that creativity is defined as a mental process involving the generation of new ideas or concepts, or new associations between existing ideas or concepts (Wikipedia, n.d.) or otherwise, like most creativity theorists will endorse (Mayer, 1999) is that creativity is “the ability to produce work that is novel (i.e. original, unexpected), high in quality and appropriate (i.e. useful, meets task constraints)” (Sternberg, Kaufman, & Pretz, 2002) It was not until the first day of my Creative Thinking class, a sentence which my lecturer, Margaret Chan, said, shook me up. She said: “There is no one definition for creativity.”

Time and again, Margaret had stood firm that there is no one definition on creativity, ideas has to be worked for and that creativity can be nurtured. This has prompted me to reflect over the myths, my thoughts and perspectives on creativity. So what is my take on the above issues? After much thoughts and readings from various sources, I believe that being creative does not mean ideas that come out have to be original, being creative does not mean that one does not have to work for ideas and that creativity can be nurtured.

Like most people, I agree that creativity involves originality. Thus, I felt that idea that comes out have to be original, new and refreshing, something one has not seen before, and then can it be considered creative. But I was wrong. Mark A. Runco states that though creativity involves originality, it does not imply that creativity is merely a kind of originality; originality is necessary but not sufficient for creativity. (Sternberg, Grigorenko, & Singer, 2004) Moreover, originality needs to be defined carefully, just like creativity. Therefore, we cannot assume that being creative means being original, vice versa. Jean Baitaillion once wrote, “Really we create nothing. We merely plagiarize nature.” (Leboeuf, 1996) It sounds quite true. New and revised books are a rearrangement of words, sentences and concepts. New knowledge is built on fundamental basics. Hence, it shows that every idea is a duplicate or built-on of an old idea. The late Dale Carnegie who is accredited with creating ideas that has enabled many people to live happier, more successful and productive has summarized his creativity this way: “The ideas I stand for are not mine. I borrowed them from Socrates. I swiped them from Chesterfield. I stole them from Jesus. And I put them in a book. If you don’t like their rules, whose would you use?” (Leboeuf, 1996) Thus, no ideas are our own and nothing one creates is original.

I used to think that creative ideas different from other forms of thinking and are very precious as they are like flashes of brilliance that will only appear out of the blue. Thus, it is not possible and we do not have to work for ideas. Yet this is true only to a fortunate few. One has to be at the right place at the right time. However, Leboeuf (1996) mentioned that the problem with this myth is that if we believe, nothing will happen. Flashes of brilliance come to those who work for them. Magical insights and solutions are sometimes stumbled on, but most of these solutions are chanced on by people who happen to be studying the problem. (Leboeuf, 1996) Perhaps, most of us have underestimated ourselves and have overestimated the unusual or special aspect of creative work. This matter of degree could have resulted in us immobilizing ourselves from trying. Therefore, ideas are not like magic. One has to work for it. Otherwise, procrastination may be the right term for those waiting to be inspired.

Though it is known that creativity is a universally distributed human trait, I once felt that not everyone can be creative. I felt that only a gifted minority are creative. Especially with Singapore’s education system or culture that taught us to accept whatever the adults say and not to rebut since young, I strongly felt that our creative potentials that we could have developed is not unready to be unleashed but has diminished over the years to the extent that it is hard to be nurtured. Furthermore, Sternberg, Grigorenko and Singer (2004) have stated that “creativity training programs…are bound to yield limited effects on the development of creativity.” At that time, I felt that unless one has that inborn and gifted talent, he or she is more likely to be creative as compared to a normal child.

However, coming to SMU have changed my perspective on creativity. Once again, I begin to feel that creativity can be nurtured. Unlike the UK-type system, SMU adopts the US system; where students have to participate actively in discussions, raise questions whenever in doubts and to look for the professors and Teaching Assistants on their own if they have further enquiries. This system prevents the breeding of comfy and conformity that we are used to in our 12 years of education. So, the verbalization of thoughts and participation in discussions can help in formation of new ideas. And that’s why we are having creative thinking classes – to nurture, encourage and celebrate differences, with old taboos removed and new exciting activities introduced. Thus, one need not necessarily be ‘talented’ to be creative. Creativity can be cultivated.

Myths are part and parcel of our lives. To let go of beliefs that we held for a long time is difficult. Yet, we should not let myths and our erroneous beliefs we harbor about creativity keep us from utilizing our creative potential. As Leboeuf (1996) remarked: “Change is tough but it’s a worthwhile investment in our growth.” As for me, given the guidance in creative thinking classes, I believe I’m on my way to confound the myths of creativity and unleash the Creative Genius within me.