Much has been said as of late about the benefits of Corporate Social Responsibility in an international context, particularly in the Western world. Philanthropic and volunteer action, both on a personal and business scale, has promoted mutually beneficial relationships between donators and beneficiaries in American and European countries, amongst others. However, amongst even the largest companies listed on the Hong Kong Stock Exchange, the role of CSR is decidedly lacklustre in comparison to their global competitors; the average donation of a company on the FTSE 100 index is over twice that of one on the Hang Seng Index¹. Sodata’s research hopes to address the largely untapped possibilities of social investing in a local context, and in doing so raise further awareness about the links between company sustainability and CSR. As employers, employees, charities and consumers, we ourselves need to understand the importance of societal action within the businesses we interact with in order to truly have an impact on the world around us.
 
Corporate Social Investing is typically defined as actions, not limited to philanthropic or volunteer work, that furthers the good of the society beyond the interests, legal or otherwise, of a firm. The vast majority of reported data on this subject found in company reports is in the form of a monetary value, typically including total donations in legal tender and the value of work hours spent through employee volunteer schemes. The data provided in this report will be in this format simply because it is the only data format that is widely accepted and thus can be used for comparison. However, it must be made clear that works of societal value can come in a wide variety of different formats not limited to those of monetary value, and that all actions to benefit the wider community are certainly considered to be of importance.

When assessing the possible motivation behind companies to engage in Corporate Social Responsibility initiatives, however, it appears curious that the property industry, an industry that does not do business directly with final consumers, would come out top in the donation charts. Corporate philanthropy is typically used as a form of brand differentiation to make a firm more appealing to potential customers⁵. Combining these initiatives with effective marketing and customer engagement, companies can appeal to customers in a different, more ethical manner, giving the firm in question a certain advantage over other competitors in the industry. However, what this model does not take into account is the means by which the company in question may invest in societal good. In terms of cost-benefit analysis, traditional CSR efforts amongst Hong Kong-listed companies vastly overlook the potential for charity action within one’s own field, with the potential for extremely effective philanthropic work at a lower cost to the company. Examination of company annual reports or specific environmental, social and governance reports have revealed that, whilst most companies delineate primarily monetary donations to various non-profit organisations, with a select few describing employee work hours dedicated to helping non-government organisations, the area in which the property industry excels is in direct societal action within the field of the industry. The development of poverty alleviating infrastructure, including villages, schools, agricultural facilities amongst others, is hugely effective and comes within the primary area of expertise for the firms involved. Further benefits to the company can still be reaped after the conclusion of such a project, as poverty decreases and the area in question attracts further investment. Over half of the donation rate of Evergrande Property Development was in this form⁶, with poverty alleviation schemes underway in seven counties in Mainland China. A second example of this scheme of donating within one’s industry can be seen in the second highest donating sector, agriculture. Mengniu Dairy, contributing over 24 million Hong Kong Dollars to societal action in 2017, has implemented the “Mengniu Inclusion Nutrition Plan”, providing rural schools in 157 Chinese regions and counties with dairy products, as well as projects to introduce breeding and rearing technology to further optimise farm production across the country⁷. The effectiveness of such ventures appertains to returning to the community whilst opening avenues for future projects and ensuring company sustainability in the years to come.

 
The benefits of Corporate Social Investing are undoubtedly far-reaching, yet they still remain unseen and untapped in the majority of Hong Kong and China-based companies. Far from a mere gesture of kindness, community investment can provide much-needed sustainability, stability and growth in a business, as well as enriching public perception of the corporation whilst benefiting society. As indispensable parts of the economic system, as leaders, employees and consumers, we must all do our part to elevate CSR into the public eye, for our good and for the greater good of society.