“Business has a responsibility beyond its basic responsibility to its shareholders; a responsibility to a broader constituency that includes its key stakeholders: customers, employee, NGOs, government – the people of the communities in which it operates.”
-Courtney Pratt, Former CEO Toronto Hydro.
CSR In South Korea:
In practice, many Korean companies comprehend CSR as philanthropy. Many major CSR activities in South Korea takes place in this area. In 2008, South Korea’s largest one hundred companies (based on sales volume) gave an average of roughly $24 million in charitable donations from 2006, despite the global economic crisis. According to the FKI’s “White Paper on Corporation and Corporate Foundation Social Giving,” in 2009 the top 500 Korean companies made philanthropic contributions equal to 4.76% of their total ordinary income, putting South Korea on par with or above other developed countries in this area. How South Korea CSR Programs Can Help the Healthcare Sector in Pakistan.
While this statistics seems to be overwhelming, the meaning of ‘philanthropic contribution’ in South Korea is often confusing. Many companies include their sponsorship of sports, games and other events with purely Public Relations functions in their reporting of philanthropic activities. Korean corporations use philanthropy to present a socially responsible and moral image and distract from probes into corporate corruption and culpability in rampant low wage jobs and precarious employment. Moreover, corporate contributions, more than half of which go to support social services and education for the underprivileged, end up enable the government’s lack of adequate public expenditure in these areas.
More and more Korean enterprises are making great social contributions, as their positive effects stand out. According to a recent Federation of Korean Industries survey answered by 231 large corporations, their spending on social contribution activities, which had reached the US $2.3403 billion in 2013, showed a very slight decrease in the following year in spite of the severe economic recession. The Korean Chamber of Commerce & Industry also mentioned that smaller Korean corporations spent an average of 349 million on CSR programs in 2014. According to its data, 60.3 percent of the expenditures were made in the form of cash donations, followed by donations in kind which is 32.2 %, employees volunteer activities 3.5%, direct social contribution programs 3.2% and property donations 0.85.
When it comes to the types of such activities in Korea, the ratio of more general and widespread ones such as assistance for the vulnerable and the less privileged in terms of education, schooling, and academic studies decreased, whereas those in the new fields including culture, arts, and sports received larger investments than before.
How South Korea’s CSR Programme Can help the Healthcare Sector in Pakistan:
According to The Tribune Express October 2017, South Korea’s help in the establishment of the Child Health Care Institute in Sukkur is aimed at fulfilling children’s early medical demands in Northern Sindh and its adjoining districts.
Pakistan and the Republic of Korea have signed a $500 million development framework under which Seoul would provide $500 million to Pakistan to meet its development programmes pertaining to different projects, including hydropower, road infrastructure, improvement of power distribution system, information technology, and more importantly health sector.
The bilateral trade between the two countries is currently worth about $1.1 billion, adding that South Korea wish to further grow as trading partners and strengthen the 34 year-long diplomatic relationships between Pakistan and the Republic of Korea
Healthcare services and medical devices are in high demand in Pakistan, especially in the growing private healthcare market. On the other hand, private hospitals and clinics are also expanding rapidly, especially in cities. According to Business Monitor International, the medical devices market in Pakistan is worth USD 457.1 million and projected to increase to USD 537.5 million by 2020, a CAGR of 6.2 %. The GOP imposes no restrictions on foreign direct investment in healthcare services and allows medical equipment imports under its “Open General” regulations.
Some medical equipment is exempted from sales taxes. Price, quality and after-sales service support are major factors in medical equipment purchase decisions. A letter of credit is usually the mode of payment for imports. Government tenders can be time-consuming, while decision-making is typically faster in private hospitals.
All these factors are in favor of foreign investments making it an easy field to consider for business. Since the establishment of diplomatic relations in 1973, Pakistan and South Korea have always maintained close relations in many areas, it would be a smart move on their part to capture this potential too.
In this era, leaders must spare their time, space and resources to think if they want business to drive sustainability. Businesses cannot be successful when the society around them fails.. However, Loyalty towards society and community adds values to the company. Therefore, if there is no loyalty, there are no values.