Breadcrumb

China

The role of CSR

Corporate social responsibility (CSR) is receiving more attention in China, although it still plays only a marginal role for the majority of Chinese companies, particularly private ones. Large state-owned companies and companies that invest in China are expected to increase their social involvement, which will no doubt have an effect on small and medium-sized enterprises as well.

Foreign companies have traditionally been active in this area, and they are increasingly involved in environmental and labor-protection projects. Generally they are guided by their own corporate standards. As domestic and foreign private companies engage in direct competition, they are recognizing that social responsibility can be used as a tool in marketing their products and increasingly resonates with the growing middle class, which has the resources to purchase these products.

CSR receives little media coverage. After the Sichuan earthquake in the spring of 2008, however, it was obvious that the efforts of domestic and foreign companies were recognized and appreciated.

Source: German Embassy, Beijing

CSR understanding

CSR was not a topic of discussion for the Chinese government in the 1980s and 1990s, as it was pursuing its policy of reform and greater openness, and the government tended to regard this area with skepticism until quite recently. The Chinese authorities viewed CSR as a means for foreign companies to pull ahead of their Chinese competitors, which had no expertise in this area. Accordingly, neither policymakers nor Chinese society pushed for companies to assume more social responsibility.

Now, however, government officials are favoring CSR as a way of achieving their goal of a harmonious society. But rather than emphasizing the moral obligations of private industry, they are focusing on economic incentives and the positive effects of CSR on areas of social concern.

Both international organizations and intermediaries play a prominent role in encouraging CSR in China. Such organizations as the German development agency Deutsche Gesellschaft für technische Zusammenarbeit (GTZ), chambers of commerce and foundations help to promote and raise awareness of CSR by holding informational events and conducting training programs.

Within the framework of its development cooperation with China, the German government supports the Sino-German Corporate Social Responsibility Project, which encourages socially, ecologically and politically responsible corporate management. The German Federal Ministry for Economic Cooperation and Development (BMZ) supports CSR activities through a number of development partnerships with the private sector (PPP).

CSR is also an important part of the work of the Germany embassy. At a seminar in Beijing in 2007, the German Chamber of Commerce and the University of Bremen presented a study called “Beyond Everyday Business - Corporate Social Responsibility – A Survey of German Enterprises in China.” During Germany’s EU Council presidency, the embassy launched the public relations campaign “We’re a Chinese company, too,” which focused on CSR.

Various associations in China are involved in this area as well, including CEEC (China Enterprise Evaluation Center), CFCSR (China Federation of CSR) and CCC (China Corporate Citizenship).

Source: German Embassy, Beijing

Expectations towards companies

It is not entirely clear what the Chinese government expects of German companies, although there is no doubt that not only the government, but also the Chinese public and the media expect foreign companies to adhere to high social and environmental standards. It is evident that interest in CSR is growing.

Source: German Embassy, Beijing

Basic conditions

Implementation of international regulations and guidelines

ILO core labor standards

China ratified the UN Covenant on Economic, Social and Cultural Rights, although it has lodged a reservation regarding Article 8, paragraph 1(a), which deals with the right to strike and the right to form independent unions.

It has not ratified ILO conventions 87 and 98 on freedom of association and the right to collective bargaining. It has ratified conventions 138 and 182 to ban and eliminate child labor. There are been repeated reports in the Chinese media about child labor, however and it continues to be common particularly in rural areas, where the material resources necessary to provide children with an adequate education are often lacking.

The conventions banning forced labor (29 and 105) have not been ratified. Forced labor in the context of prison work and reeducation through labor are officially sanctioned; trafficking in women and children for the purpose of forced labor and forced prostitution is a widespread problem at the provincial level and frequently covered in the media. China ratified ILO conventions 100 and 111, which ban discrimination in respect of employment and occupation, and passed laws in support of those bans; however, there are substantial gaps between the letter of the law and actual practice in certain regions and economic sectors.

Industry initiatives

GLOBAL COMPACT NETWORK

Local Contact

China Enterprise Confederation CEC
Chen Ying (Ms)
chenying (at) cec-ceda.org (dot) cn
http://www.cec-ceda.org.cn
http://www.cec-ceda.org.cn/english_version/

All China Federation of Industry and Commerce
China Society for the Promotion of the Guangcai Program
Hao Chen (Mr)
gco3 (at) 263 (dot) net
http://www.cspgp.org.cn/13_English/4.htm

UN / UNDP
Luan Liying (Ms)
liying.luan (at) undp (dot) org

GC Office Country Coordinator
Mr. Fred Dubee
dubee (at) un (dot) org
Ms. Meng Liu
lium (at) un (dot) org
+1-917-367-2186

WORLD BUSINESS COUNCIL FOR SUSTAINABLE DEVELOPMENT

Network in place since 2004

Contact on site:
ZHAI Qi , Executive Director
Ji Qing, Project Dept. Manager
China Business Council for Sustainable Development
A6 Huixin East St. Chaoyang District,
100029 Beijing, China
Tel.: +86-10-64990660
Fax: +86-10-84643582, 84645727
E-mail: info (at) cbcsd.org (dot) cn
Website: www.cbcsd.org.cn

Areas of activity

Poverty

China’s economy has grown at an annual rate of slightly more than 10 percent over the past 10 years, which has led to a substantial decrease in the country’s poverty rate and raised the standard of living nationwide. Poverty still exists, however, particularly in China’s western regions.

Basic information

  • Life expectancy: Total population: 73.18 years; males: 71.37 years; females: 75.18 years (2008 est.)
  • Infant mortality: Total: 21.16 deaths/1,000 births; males: 19.43 deaths/1,000 births; females: 23.08 deaths/1,000 births (2008 est.)
  • Malnutrition: 12% (2002/04)
  • Access to clean water: 77% (2004)
  • Access to sanitary facilities: 44% (2004)
  • Human Poverty Index: 29th of 108 (2007/2008)
  • Gini Index: 47 (2007)
  • Population below the poverty line: 8%
    - 21.5 million people in rural areas are below the official “absolute poverty line” (approximately 90 USD per year)
    - another 35.5 million rural residents can be classified as low-income earners (approximately 125 USD per year) (2006 est.)

Accordingly, there is a need for financial support for projects and for donations to national and international NGOs and other organizations that work to combat poverty. Also important are microloans for small projects, which benefit communities and villages directly. Support for academic studies and educational programs helps to produce the knowledge base necessary for long-term efforts to fight poverty and raises public awareness. So-called multi-stakeholder partnerships, joint projects with communities to improve education, health and child development, are needed as well. Houses and schools have had to be rebuilt after the Sichuan earthquake in May 2008, and that disaster has increased the need for educational support and anti-poverty measures.

Participants

  • State Council Leading Group of Poverty Alleviation and Development (government development organization, established in 1986: Draws up studies and guidelines, implements projects and advises on policy regarding education, women and children.
    http://en.cpad.gov.cn/
  • Mercy Corps (NGO/international foundation for humanitarian aid and development): Active in civil-society projects aimed at supporting local NGOs, serves as a link between companies, educational institutions and official agencies. Projects in the areas of emergency aid, economic development, civil society and women’s affairs.
    http://www.mercycorps.org/chinaearthquake
  • The China Foundation for Poverty Alleviation (CFPA; NGO/nonprofit foundation, established in 1989, China’s largest and best known nonprofit organization): Projects for building capacity, increasing income and promoting sustainable development as well as in the areas of community development, emergency aid, health and nutrition, IT and homelessness.
    http://www.fupin.org.cn/en/index.asp
  • UNICEF (UN children’s aid agency; founded in 1946, has cooperated with the Chinese government for the past 25 years): Helps children and mothers in developing countries and crisis regions, works to provide education, medical care, drinking water and food. Protects children from exploitation and abuse.
    http://www.unicef.org/china
  • Beijing University (research and educational institution since 1898): Gives seminars and conducts studies in the field of CSR.
    http://en.pku.edu.cn
  • China Association of Microfinance (CAM; cooperative): Involved in fundraising and strengthening microfinance institutions; CAM is made up of national MFIs (microfinance institutions), national and international institutions and individuals; assists in financing, CSR investments and philanthropy.
    http://www.chinamfi.net/en/index.asp

Opportunities and risks related to poverty initiativesWith respect to their supply chains, companies can use their social capital and influence to reduce income gaps, improve housing and have a positive effect on other poverty-related issues. Although the Chinese government continues to welcome private sector contributions to social development, companies need to be careful not to exceed their “social license.” They should consider each project on an individual basis and adhere to cooperation agreements.

Company examples

Bayer

Since 2003, Bayer has been working with Mercy Corps, the China Foundation for Poverty Alleviation and other companies to support microloans and education on crop protection for farmers in Fujian and Guizhou Provinces. The goal is sustainable improvement in the standard of living.

FAW-VW Audi

In 2006, FAW-VW Audi and UNICEF initiated the Driving Dreams project, which provides long-term support for children and young people in the poorer regions of western China (so far investing some 7 million RMB). Because of the Sichuan earthquake, the project was expanded to include a special relief fund for affected children.

Deutsche Bank

Deutsche Bank is involved in poverty research in cooperation with Beijing University.

TUI

Through the Hapag-Lloyd Foundation, TUI provides support for the children’s relief organization Plan International in China, a project that includes employees of Hapag-Lloyd Group. Monthly contributions finance community projects such as schools, wells and hospitals.

Siemens Ltd., China

CSR WeltWeit case study (English): Siemens Caring Hands - Disaster Relief
CSR WeltWeit case study (English): Siemens Caring Hands - Employee Volunteering
CSR WeltWeit case study (English): Siemens Caring Hands - Public Welfare
CSR WeltWeit case study (English): Siemens Caring Hands - Health Care
CSR WeltWeit case study (English): Siemens Generation21 - Discovery Box / Education & Training

Randstad Deutschland GmbH & Co.KG

CSR WeltWeit case study (German): VSO – Voluntary Service Overseas

Bertelsmann AG

CSR WeltWeit case study (German): Bertelsmann unterstützt Plan International beim Wiederaufbau chinesischer Schulen

Source: German Embassy, Beijing

Education

Basic information

  • Public spending on education (share of GDP): 1.9% (1999)
  • Compulsory school attendance: 6–14 years of age
  • Literacy (definition: those over the age of 15 who can read and write): Total population: 90.9%; males: 95.1%; females: 86.5% (2000 census)
  • HDI Education Index: Rank 81 out of 177 (1 = max., 0 = no education)
  • Average years of education: Total population: 11; males: 11; females: 11 (2006)

Particularly in China’s western regions, access to education is not universal. Although the Chinese government is trying to provide more educational opportunities in disadvantaged areas, much still remains to be done. German companies could be involved in providing appropriate training. Financial support and scholarships could enable good students to attend university.

Participants

  • China Business Council for Sustainable Development (CBCSD, NGO; established in 2003 by China Enterprise Confederation (CEC), World Business Council for Sustainable Development (WBCSD) and prominent companies): Promotes an exchange of information and views between companies, the government and interested organizations; projects related to the environment, health and safety, the supply chain and social standards (worker protection).
    http://english.cbcsd.org.cn
  • Chinese Academy of Sciences (at Beijing University; leading university and research institution in the natural sciences and high-tech innovation): Promotes international scientific exchange and cooperation with other scientific and technical institutions as well as cooperation with companies through workshops, training programs and seminars.
    http://english.cas.ac.cn
  • UNICEF (children’s aid agency of the United Nations; established in 1946, has cooperated with the Chinese government for the past 25 years): Helps children and mothers in developing countries and crisis regions, provides education, medical care, drinking water and food. Protects children from exploitation and abuse.
    http://www.unicef.org/china
  • China Association for NGO Cooperation (CANGO, founded in 1992): Nonprofit association of Chinese nongovernmental organizations with 100 members nationwide; sees its role as an intermediary between international and Chinese organizations with the goal of promoting civil society in China; projects relating to capacity development for NGOs, CSR, combating poverty, environmental and climate protection, rural development.
    http://www.cango.org/english
  • China Corporate Citizenship Committee (NGO; founded in 2003 by well-known companies): nationally active NGO in the field of CSR, recognized by the Ministry of the Interior; projects related to fighting corruption and promoting transparency, education, the environment, financial affairs, health and safety, philanthropy, worker protection, women and children.

Training is badly needed within Chinese companies as well. Particularly in the case of suppliers or trading partners of German companies, it is important to ensure that training opportunities and good working conditions are in place and to promote ecological and social responsibility.

Company examples

Many German companies offer scholarships for schoolchildren and university students or make financial contributions to schools, universities and other educational facilities.
Particular mention should be made of the School Construction Initiative in Sichuan, under which the German government and prominent German companies are building and expanding eight schools in the earthquake region.

Siemens Ltd., China

Siemens China has been providing support for Beijing’s universities since 2008. Among other contributions, Siemens has awarded a scholarship to 40 students at Beijing Sports University. In connection with the earthquake in Sichuan, Siemens has reached an agreement with the Mianyang Education Bureau to finance the education of 20 orphans (a contribution totaling 1 million RMB = 115,200 EUR). In addition, Siemens has donated 100 so-called Discovery Boxes to Chengdu Paotongshu elementary school to encourage interest in science and education.

CSR WeltWeit case study (English): Siemens Generation21 - Discovery Box / Education & Training

CSR WeltWeit case study (German): Discovery Box - Experimentierkasten für die Vorschule

CSR WeltWeit case study (English): Siemens Caring Hands - Employee Volunteering

CSR WeltWeit case study (English): Siemens Caring Hands - Public Welfare

CSR WeltWeit case study (English): Siemens Caring Hands - Health Care

BMW

BMW established the long-term BMW Children's Traffic Safety Education program, in which more than 2,000 children between the ages of four and six have participated so far.

BASF

BASF initiated the “1+3” SME CSR project, which raises awareness by teaching other companies about the basic principles of CSR. BASF also supports education, the arts and science through its “Kids’ Lab”: More than 74,000 schoolchildren in China have benefited from this innovative chemistry laboratory for children, along with other services provided by BASF. 

Bayer

Bayer has an ongoing arrangement with the Chinese Academy of Sciences at Beijing University to provide scholarships to 20 chemistry students at the Academy. Bayer is also working with Shanghai Petrochemical Academy to train technicians in the field of chemistry. Thirty-six students in the Bayer SPA class take part in training courses, work at a training site and complete a 12-week internship at Bayer’s Shanghai location. In addition, Bayer is involved in a number of different foundations for education and scientific research.

Audi

The Audi Driving Dreams project, which Audi organizes in collaboration with UNICEF, aids homeless children and school dropouts in China’s poorer regions.
Between 2006 and 2010, Audi is providing computers, digital cameras and sports opportunities for 140 “Village Knowledge and Information Centers” in 10 provinces. Every year, Audi donates at least 100,000 USD (= 79,397 EUR) for educational centers, which offer better learning conditions for some 30,000 students. At those centers Audi also distributes information about AIDS, drugs and other social concerns.

Global Reporting Initiative

CSR WeltWeit case study (English): Transparency in the Supply Chain

Randstad Deutschland GmbH & Co.KG

CSR WeltWeit case study (German): VSO – Voluntary Service Overseas

Bertelsmann AG

CSR WeltWeit case study (German): Bertelsmann unterstützt Plan International beim Wiederaufbau chinesischer Schulen

Opportunities and risks related to educational initiatives

German companies are involved in a wide variety of educational projects that contribute to child development and ensure better training for workers. Because of these efforts, they have a good relationship with local officials, and communities have become more receptive to participating in their projects. Education reduces the poverty rate and contributes to economic development, which in turn increases the size of the middle class and leads to better sales prospects.

Differences in ideas about education, rooted in cultural differences, pose certain risks. Companies need to avoid overstepping their “social license”; they should look at each project on an individual basis and adhere to cooperation agreements.

Source: German Embassy, Beijing

Health

Basic information

  • Public spending on health (share of GDP): 1.8% (2004)
  • Medical care: 106 physicians per 100,000 residents (2000- 2004)
  • Infant mortality: Total: 21.16 deaths/1,000 births; males: 19.43 deaths/1,000 births; females: 23.08 deaths/1,000 births (2008 est.)
  • Maternal mortality: 51 deaths/100,000 births (1990-2004)
  • Child malnutrition: 8% of children under the age of 5 (1996- 2005)
  • HIV/AIDS prevalence rate (>15 years of age): 0.1 % (2003)
  • HIV/AIDS sufferers: 840,000 (2003 est.)
  • HIV/AIDS deaths: 44,000 (2003 est.)
  • Life expectancy: Total population: 73.18 years; males: 71.37 years; females: 75.18 years (2008 est.)

While China has made great strides in the healthcare sector since the country became more open in the late 1970s, help is still needed, particularly in rural areas. Poverty and unemployment limit access to medical care. Medical equipment is often inferior or outdated. Advanced training in health-related occupations is needed, as is education about health risks (AIDS etc.) and healthy working conditions.

Participants

  • Chinese Ministry of Health: Coordinates and regulates the healthcare sector. Works with national and international institutions. Projects relating to health, safety, industrial safety regulations, women and children.
    http://www.gov.cn/english/2005-10/09/content_75326.htm
  • Red Cross Society of China (RCSC; Humanitarian aid organization, founded in 1904): The only national Red Cross organization in China; active in the areas of disaster relief, health, blood drives, community service and organizational development.
    http://www.redcross.org.cn/ywzd
  • National Press Foundation: Foundation for training journalists. The National Press Foundation has provided basic and/or further training for more than 5,000 reporters and editors since 1976.
    http://www.nationalpress.org
  • Marie Stopes International (nonprofit organization): Marie Stopes International is a nonprofit organization that deals with sexual issues and family planning. It carries out family planning projects and provides support for families.
    http://www.mariestopes.org.uk/Home.aspx

Opportunities and risks related to healthcare initiatives

German companies can indirectly affect the healthcare sector by training their employees and organizing educational events on such topics as HIV/AIDS, thereby helping to mitigate health problems and reduce related costs. German companies could also provide support for other organizations or contribute financially to disaster relief. Partnerships with local health organizations enhance public credibility and help prevent cultural misunderstandings regarding medical care.

Company examples

Siemens Ltd., China

In 2007, Siemens launched a five-year health program costing 10 million USD (= 7.9 million EUR). It has the support of the Chinese Ministry of Health and is intended to improve medical care in rural areas.

Siemens has also donated a mobile water treatment system valued at 1 million RMB (= 115,200 EUR) to the Wuxi Red Cross. Since 1987 the company has been working with Chinese partners to help the hearing impaired; so far medical care and hearing aids have been provided, sometimes free of charge, to more than 40,000 individuals. In response to last May’s earthquake, Siemens set up a telediagnosis system making it possible to provide emergency aid to the injured on site. Finally, the company has contributed 2 million RMB (= 230,400 EUR) and donated medical equipment worth 4 million RMB (= 460,800 EUR).

CSR WeltWeit case study (English): Siemens Caring Hands - Disaster Relief

CSR WeltWeit case study (English): Siemens Caring Hands - Employee Volunteering

http://typo3/http://www.csr-weltweit.de/fallstudien/studie/siemens-ltd-china-siemens-caring-hands-employee-volunteering/index.htmlCSR WeltWeit case study (English): Siemens Caring Hands - Public Welfare

http://typo3/http://www.csr-weltweit.de/fallstudien/studie/siemens-ltd-china-siemens-caring-hands-public-welfare/index.htmlCSR WeltWeit case study (English): Siemens Caring Hands - Health Care

http://typo3/http://www.csr-weltweit.de/fallstudien/studie/siemens-ltd-china-siemens-caring-hands-health-care/index.htmlCSR WeltWeit case study (English): Siemens Generation21 - Discovery Box / Education & Training

CSR WeltWeit case study (German): Safe Water Kiosk – Mobile Filteranlagen für eine nachhaltige Wasserversorgung

Bayer AG

In 2004, Bayer introduced the Tsinghua-Bayer Public Health and HIV/AIDS Media Studies Program to work with the media to promote understanding of HIV/AIDS and prevent discrimination.

Adidas AG

Adidas launched a new HIV-AIDS and reproductive health program in Guangdong Province in 2008.

Randstad Deutschland GmbH & Co.KG

CSR WeltWeit case study (German): VSO – Voluntary Service Overseas

Bertelsmann AG

CSR WeltWeit case study (German): Bertelsmann unterstützt Plan International beim Wiederaufbau chinesischer Schulen

Source: German Embassy, Beijing

 

Political involvement

As China has undertaken market-oriented reforms, cooperation between German companies and Chinese ministries and provincial governments has increased. The Chinese government is eager and willing to work with German companies on projects that relate to the country’s development or improve its standard of living.

Basic information

Voting rights: 18 years of age, universal
Freedom of the press: Ranks 163rd of 169 (2007)

Successful cooperation can lead to corporate input into future laws and regulations. Certain German companies have made a substantial contribution to social stability and the standard of living. Roundtable talks are an excellent format for an exchange of views and experiences and a discussion of joint solutions.

Participants

Possible participants include organizations for development cooperation (GTZ, CIM etc.), chambers of commerce, trade associations, trade unions, ministries (Ministry of Industry, Ministry of Small and Medium-Sized Enterprises) and political foundations (such as the Friedrich Ebert Foundation, the Friedrich Naumann Foundation and the Konrad Adenauer Foundation).

GTZ in China
http://www.gtz.de/en/weltweit/asien-pazifik/606.htm

CIM China
http://www.cimonline.de/en/weltweit/313.asp

German Chamber of Commerce in China
http://china.ahk.de

Konrad Adenauer Foundation, China office
http://www.kas.de/proj/home/home/37/1/index.html

Friedrich Ebert Foundation in China
http://www.feschina.net

Opportunities and risks related to involvement in the area of political participation

More opportunities are arising for German companies to work with the Chinese government. However, it is important to be cautious about influencing Chinese politics. The best course is to become involved in civic affairs and seek dialogue with the relevant authorities without applying any pressure.

Company examples

BASF

In 2007, BASF and the Chinese Research Academy of Environmental Sciences (CRAES), under the direction of the State Environmental Protection Administration (now called the Ministry for Environmental Protection), established a diesel test laboratory to find ways for China to reduce its fuel emissions.

METRO Group

METRO Group cooperates with suppliers and local agencies in the Business Social Compliance Initiative (BSCI) and organizes roundtable talks to discuss regulations and standards with members of the Chinese government, trade associations, NGOs, universities, editors and other organizations.

Volkswagen Group China

Together with the Center for Environmental Education and Communications (CEEC) and the State Environmental Protection Administration (now called the Ministry for Environmental Protection), in 2007 Volkswagen Group China (VGC) launched the three-year Green Future Environmental Education Initiative (GFEEI). Volkswagen is investing 8 million RMB (= 921,600 EUR) to raise awareness of environmental protection and encourage children at 700 schools to behave in an environmentally responsible way.

Source: German Embassy, Beijing

Participation in society

Over the past few years, many German companies have become involved in this area and provided support for socially disadvantaged groups. Increased prosperity has highlighted weak points in the social system, and companies have attempted to remedy these problems by soliciting donations and holding charity events.

Basic information

  • Share of women in the labor force: 52% (1994-2005)
  • Ethnic groups: Han Chinese (91.5%), Zhuang, Manchu, Hui, Miao, Uigur, Tujia, Yi, Mongol, Tibetan, Buyi, Dong, Korean, other (8.5%) (2000 census)

Some companies provide both financial and material support for needy families, and many encourage their employees to become involved in society. In addition, a number of companies work with their business partners to improve the social circumstances of the partners’ employees. Various public-private partnerships (PPPs) seek to improve social conditions and labor protection regulations.

Participants

State Council Leading Group of Poverty Alleviation and Development (part of the State Council): This group is responsible for coordinating, evaluating, researching and drawing up guidelines and plans for economic development in less prosperous regions of China; projects relating to education, women and children.
http://en.cpad.gov.cn

Education Development Center (EDC; international nonprofit organization): EDC works with a variety of partners and sponsors, local nonprofit organizations, governments, the UN, universities and foundations to promote education and health. It was established in 1958 as an international nonprofit organization intended to devise strategies for improving health, education, labor and development throughout the world.
http://main.edc.org

Asia Foundation: This foundation supports programs in Asia that promote good governance, law, economic development, women’s rights and international relations. Asia Foundation has been active in China since 1979. Its CSR program concentrates mainly on supporting disadvantaged female migrant workers. Projects in the areas of education, the environment, labor protection regulations, women and children.
http://asiafoundation.org/country/overview/china

Deutsche Gesellschaft für Technische Zusammenarbeit (GTZ) GmbH (implementing agency of the German government): Assists the German government in achieving its development policy goals. Its aim is to bring about long-term improvement in living conditions.
Founded in 1975 as a private company. Its main client is the German Ministry for Economic Cooperation and Development (BMZ). Projects in the areas of education, the environment, poverty and sustainable development.
http://www.gtz.de/en/weltweit/asien-pazifik/606.htm

Beijing Charity Association (NGO): The Beijing Charity Association (BCA) is a legally registered nonprofit association that is active in promoting charitable causes. Projects in the areas of social welfare, children, education.
http://www.bjcsh.org.cn/english/tabid/90/Default.aspx

UNICEF (UN children’s aid agency; founded in 1946, has cooperated with the Chinese government for the past 25 years): Helps children and mothers in developing countries and crisis regions, works to provide education, medical care, drinking water and food. Protects children from exploitation and abuse.
http://www.unicef.org/china

FuPing Development Institute (FDI; nonprofit organization, founded in 2002): FDI promotes sustainable development and social equality. It supports a variety of NGOs and social institutions, and assists in reforming the educational system. In 2006, FDI merged with the Institute for Environment and Development. Projects in the areas of education, the environment, labor protection regulations, women and children and charity work.
http://www.fdi.ngo.cn/front-page-en

Fair Labor Association (FLA; NGO): The Fair Labor Association (FLA) is a nonprofit organization that serves as a liaison between industry, NGOs, schools and universities in the area of labor regulations and labor protection provisions. Projects in the areas of health, labor protection regulations, women and children.
http://www.fairlabor.org

Opportunities and risks related to involvement in the area of social participation

German companies can contribute to social development in China by influencing their suppliers and business partners. This can help to close the income gap and improve working conditions and opportunities for education and training in China. However, it is important to avoid placing unrealistic demands on China’s social standards.

Company examples

Adidas AG

Adidas established a public private partnership with the Education Development Center (EDC) aimed at improving China’s labor market conditions. The project focuses on ensuring fair hiring procedures and creating better working conditions for migrant workers in Chinese factories. A pilot project began in October 2008 with the support of a variety of local and international organizations, including GTZ.

 

Tchibo

Tchibo is working with GTZ on a public-private partnership project to establish local training centers for suppliers. In China, the project is focused on Tchibo suppliers from the Guangdong and Shanghai regions. The aim is to use these centers to raise suppliers’ awareness of issues relating to work hours, wages, child labor, discrimination, safety, heath, social security and communication between management and employees.
Siemens AG
In 2008, Siemens donated 300,000 RMB (= 34,550 EUR) to low-income families in Wangjing District.

BASF AG

BASF has held several events in Nanjing to discuss key topics such as environmental protection, safety and local economic issues.

Audi AG

Together with UNICEF, Audi organized a Driving Dreams charity auction banquet to raise awareness of the needs of children.
Global Reporting Initiative
CSR WeltWeit case study (German): Transparency in the Supply Chain

Source: German Embassy, Beijing

Environment

China’s population, economic growth and increased demand for goods are leading to environmental challenges including land degeneration, deterioration of water quality, serious air pollution and deforestation. These problems threaten the health of the Chinese people and undermine sustainable growth and development. Through partnerships and advisory efforts, German companies can play an active role in raising awareness of environmental issues. Cooperation with Chinese authorities, universities, charitable organizations and foundations is a popular way of approaching this issue.

Basic information

  • CO2 emissions: 17.3% of total world output (2004)
  • CO2 emissions per capita: 3.8 metric tons (2004)
  • Electricity consumption: 3.271 trillion kWh (2007)
  • Water consumption (household/industry/agriculture): Total: 549.76 km3/year (7%/26%/68%); per capita: 415 m3/year (2000)
  • Hydropower, solar, wind, geothermal energy: 2.0% of primary energy consumption (2005)

Agreements have also been reached to work together to educate the public about climate protection, air pollution and sustainable development. In some cases companies advise political decision makers on improving the standard of living or provide emissions testing. More workshops should be held on energy efficiency and hazardous waste management, as well as environmentally friendly technologies in companies’ supply chains.

Participants

  • Chinese Research Academy of Environmental Sciences (CRAES; nonprofit research institute): Carries out studies and research on environmental protection, aimed at achieving sustainable development; founded in 1978 as a national nonprofit research institution.
    http://www.craes.cn/cn/english/welcome.html
  • Chinese Ministry of Commerce: Regulates market performance and the traffic of goods and seeks to improve facilities and economic conditions; responsible for the environment, financially and socially responsible investment, health and labor protection regulations.
    http://english.mofcom.gov.cn
  • The Center for Environmental Education and Communications (CEEC) is the national center for television productions on environmental protection, and a partner for international cooperative ventures in the areas of environmental education and communications. Projects including a campaign to disseminate information about organic foods.
    http://www.chinaeol.net/en
  • CEEC of the Ministry for Environmental Protection (formerly known as SEPA) is the center for national education on environmental issues.
    http://www.chinaeol.net/en
  • China Environment and Sustainable Development Reference and Research Center (CESDRRC): CESDRRC is the largest center for information on the environment and sustainable development. Its task is to make information about environmental issues available to the public, to share knowledge and to form international networks.
  • CESDRRC is a project of the Center for Environmental Education and Communication (CEEC) in the areas of education, the environment and charity work.
  • Ministry for Environmental Protection (formerly the State Environmental Protection Administration,  SEPA): Responsible for promoting environmental protection and developing the necessary technologies.
    http://english.mep.gov.cn

Opportunities and risks related to environmental initiatives

Companies’ supply chains offer the best opportunities for environmental projects. German companies often focus on climate protection, and they should take advantage of their credibility and expertise in this field. Particularly for small and medium-sized enterprises, the main obstacle is a lack of resources, time and experience, as well as influence. Support and recognition from the government, the companies’ own employees and customers are often lacking as well. Moreover, companies in China frequently find themselves confronted with confusing bureaucratic structures, unnecessary red tape and an unclear legal situation. It should also be noted that some companies see it as economically disadvantageous to adhere to environmental protection requirements, and that China has a long way to go to achieve Western standards. Unfortunately, no single authority has the power to make decisions about CSR projects, so companies have to deal with numerous agencies. Language barriers and cultural differences present additional challenges.

Company examples

Vaillant Heizungstechnik

Vaillant Heizungstechnik donated 10,000 bicycles during the Olympic Games.

Bayer AG

Through its Young Environmental Envoy Program, Bayer organizes discussions at several universities in cooperation with UNEP. It has been sponsoring environmental programs for young people for the last four years. In their subsequent careers, the alumni of this program are active in raising awareness of environmental issues. Bayer also works with the Animals Asia Foundation, which has signed a cooperation agreement with the China Wildlife Conservation Association to protect 500 bears. The company has been supporting the Asian Animal Fund’s Moonbear Rescue Center in Chengdu since 2004.

BASF AG

Within the framework of a memorandum of understanding, BASF is working directly with Chinese environmental authorities on knowledge sharing, assessing the environmental impact of residential buildings and developing clean fuels. In 2007, BASF and the Chinese Research Academy of Environmental Sciences (CRAES), under the leadership of the State Environmental Protection Administration (now known as the Ministry for Environmental Protection), established a diesel test laboratory to find ways to reduce China’s fuel emissions.

Volkswagen Group China

In 2007, Volkswagen Group China (VGC) launched the three-year Green Future Environmental Education Initiative (GFEEI) to raise Chinese schoolchildren’s awareness of environmental issues. It involves cooperation between VGC and the Center for Environmental Education and Communications (CEEC) of the former State Environmental Protection Administration of China (SEPA). Volkswagen is investing 8 million RMB (= 921,600 EUR) to raise awareness of environmental protection and encourage children at 700 schools to behave in an environmentally responsible way.

Siemens AG

Siemens has launched its Coping with Global Warming - 2008 Tree Planting program, an initiative in cooperation with the China Green Foundation and the National Development of Reform Center (NDRC) that concentrates on the effects of climate change. Siemens donated 100,000 RMB (= 11,514 EUR) to the Shanghai Charity Foundation in Yangpu in 2008. It is also involved in finding innovative approaches to ensuring the supply of drinking water and to energy efficiency in rural areas, for example through its three-year Green Village program (since 2007).

CSR WeltWeit case study (German): Safe Water Kiosk – Mobile Filteranlagen für eine nachhaltige Wasserversorgung

CSR WeltWeit case study (English): Siemens Caring Hands - Employee Volunteering

CSR WeltWeit case study (English): Siemens Caring Hands - Environmental Protection and Sustainable Development

CSR WeltWeit case study (English): Siemens Caring Hands - Disaster Relief

Adidas AG

Adidas sponsors energy-efficiency projects in China and Vietnam, involving more than 100 of its suppliers.

E.ON AG

E.ON is supporting a biomass project in China. The goal of this and other projects worldwide is to reduce the level of CO2 emissions by 3.2 million tons between 2008 and 2012.

Global Reporting Initiative

CSR WeltWeit case study (English): Transparency in the Supply Chain

Randstad Deutschland GmbH & Co.KG

CSR-WeltWeit Fallstudie: VSO – Voluntary Service Oversea

Source: German Embassy, Beijing

 

Other

Other areas of German corporate involvement include disaster relief, sports and cultural events.

Disaster relief
In the area of disaster relief, German companies can contribute financial and material support, help with building infrastructure and assist in building hospitals and schools and providing social services, etc.

  • Volkswagen donated 6 million RMB (= 691,000 EUR) to help the victims of the earthquake in Sichuan Province.
  • Siemens donated more than 15 million RMB (= 1.7 million EUR) to the Red Cross and other aid organizations that were dealing with the effects of the Sichuan earthquake. In early 2008, Siemens contributed resources to help the victims of the snow disaster.
  • Together with the China Charity Foundation (CCF), BMW China established the BMW Warm-Heart Fund to support reconstruction efforts in the Sichuan earthquake region.
  • The Audi Driving Dreams project established a fund for children in the earthquake region.

Cultural engagement
Cultural exchange is also important, and companies can promote international and intercultural understanding by holding events relating to China’s cultural heritage and history.

  • In 2007, Siemens donated energy-saving products worth 2 million RMB (= 230,400 EUR) to help renovate the Wenyuan building at Tongji University.
  • BMW launched its China Culture Journey program to support talented artists.  The 11-day “BMW China Culture Journey 2007" traveled from Beijing to Dunhuang and visited 11 material cultural heritage projects and 17 non-material cultural heritage projects, contributing roughly 1 million RMB (= 115,200 EUR).

Involvement in the area of sports
The Olympic Games offered a platform for volunteer efforts, donations and joint activities in the fields of education and health.

  • As an Olympic partner, Adidas provided uniforms for 70,000 volunteer workers during the Olympics.
  • In June 2004, Bayer launched its “Soccer-in-a-Box” program with partners including World Vision and DHL. This program for children in rural areas emphasizes sports, education and teamwork. In 2006, Bayer sent out 617 boxes of soccer equipment to rural areas, allowing more than 7,000 Chinese children to take part in a healthy team sport. Bayer has been a partner of the Special Olympics since 2002. It is currently supporting three “special schools” through its adopt-a-school program.

Relevant actors

  • Cultural Communication Center for Facilitators (CCCF): NGO with projects to promote participation in society, combat poverty and represent the interests of poor people and the rural population; founded in 2003 as an independent local NGO. Motto: "Solidarity and Cooperation, Helping Others and Yourself."
    http://www.facilitator.ngo.cn/cn/eglish_%20jianjie%201.htm
  • Red Cross Society of China (RCSC): Humanitarian aid organization; the only national Red Cross organization in China; founded in 1904 with projects in the areas of disaster relief, health, blood donations, community service, and organizational development.
    http://www.redcross.org.cn/ywzd
  • China Charity Foundation (CCF): NGO; national charitable organization financed by individuals, companies and social institutions; founded in 1994 with the approval of the Chinese government; active in the areas of disaster relief, support for the disabled, senior citizens, orphans, medical aid, combating poverty and education.
    http://cszh.mca.gov.cn/article/english
  • UNICEF: (International organization, UN children’s aid agency; helps children and mothers in developing countries and crisis regions, works to provide education, medical care, drinking water and food. Protects children from exploitation and abuse. Founded in 1946. Has worked with the Chinese government for the past 25 years. Projects in the areas of emergency aid, health, education, also protects women from exploitation and abuse, HIV/AIDS.
    http://www.unicef.org/china
  • World Vision International: NGO active in efforts to combat poverty and in the areas of education, emergency aid, medical care, particularly for children; it implemented projects worth 91.15 million USD in China between 1989 and 2005. World Vision International was founded in 1950 and has been active in China since 1993.
    http://www.wvi.org/wvi/wviweb.nsf

Opportunities and risks

Companies have a responsibility to help society. German companies have provided such help quickly and effectively, for example after the Sichuan earthquake last May. It is important to take into account cultural and context-specific attitudes toward emergency aid; accordingly, efforts in China after the May earthquake have concentrated primarily on financial assistance.

Data & facts

Country: People’s Republic of China
Capital: Beijing
Area: 9,597,995 km²
Population: 1.3 billion
Economic system: Socialist economic system with certain features of a market economy
Polity: Socialist people’s republic
Unemployment rate: 4.0 % (2007 est.)
Inflation rate (CPIX): 4.8 % (2007 est.)
GDP: 4.222 trillion USD (2007 est.) = 2 billion EUR
GDP/Head: 5,300 USD (PPP, 2007 est.) = 4,205 EUR
Religions: Buddhist, Daoist, Muslim, Christian (Protestant and Catholic)
HDI: 81st of 177 (2007/2008)
CPI: 72nd of 179 (2007)
BTI: Status Index: 85th of 125; Management Index: 67th of 125 (2008)

Further links

Further studies