In Pakistan, with the exception of multinational companies or a handful of local visionary entrepreneurs, many companies are still trying to understand corporate citizenship, and how it can benefit the society at large by leveraging their competitiveness. There generally is lack of understanding and a misleading perception that corporate social responsibility (CSR) is interchangeable with charitable giving or compliance with externally imposed buyer-codes, rather than an embodiment of Islam’s mandatory focus on equity and social responsibility.
To illustrate, Pakistan’s growing tradition of corporate philanthropy tends to co-exist with irresponsible behaviour manifested in an aversion to accountability, lack of governance mechanisms, tax avoidance, labour exploitation, poor product integrity, wasteful processes and disregard for the environment. Recently, the Asian Sustainability Report (ASR) suggests:
“Disclosure in Pakistan is generally poor with only three companies making it into the top half of the overall ASR. What is perhaps most surprising in the context of large listed companies in Pakistan is that there exists a large number of subsidiaries of Western multinational corporations, who are nevertheless consistently poor at providing meaningful information to stakeholders. It is somewhat surprising that Standard Chartered, Royal Bank of Scotland and GlaxoSmithKline all fine themselves in the bottom quartile of the ASR. This reflects an oft cited accusation that multinational corporations often have sophisticated policies and systems relating to CSR (or ESG) in their home countries, but that does not adequately translate into the same types of activities in developing countries where stakeholder pressure is not as significant.”
The ASR study includes ten Asia Pacific markets: Australia, China, Hong Kong, India, Japan, Malaysia, Pakistan, Philippines, Singapore and Thailand and ratings are based on
51 indicators under six indicator section headings:
- Governance, Code and Policies
- CSR Strategy and Communication
- Marketplace and Supply Chain
- Workplace and People
- Environment
- Community and Development
The report further suggests that:
“What little disclosure there is in Pakistan seems to revolve around the provision of information about general policies, codes and governance issues. Less than one in five companies provide any information on the environment, supply chains and community and development, all issues that are particularly important in the context of Pakistan. There is a great opportunity for companies to take a lead on engaging with sustainable development in a country like Pakistan. Our research tends to demonstrate that in most cases that is not the case, however.”
Published Date: December 28, 2009