RESPONSIBLE BUSINESS CONDUCT

in THAILAND 

Dr. Pipat Yodprudtikan

Thaipat Institute

2-3 NOVEMBER 2009UNITED NATIONS CONFERENCE CENTRE

BANGKOK, THAILAND

Almost all research studies conducted by international agencies have concluded that the CSR in Thailand mostly involves donations and

community volunteering.

In fact, the RBC/CSR practices in Thailand have significantly advanced from their origin. The important factors that cause the CSR studies in

Thailand from the international views limit to above activities consist of the following:

•Lack of current resources in English. Almost all information on CSR activities and movement in Thailand are written in Thai making it

difficult for foreign researchers to conduct studies. Even the recent studies still rely on outdated information sources in English, making it

inaccurate in concluding CSR development in Thailand.

•Use of surveys and polls has certain limitation by sample size and population dispersion. These factors are necessary conditions for processing the output in macro view. Specifically, for analyzing the

different characteristics of CSR development between large enterprises versus small and medium enterprises, or between business in urban and

rural areas. 2

In Thailand, the total number of all types of enterprises in 2008 was 2,836,377

•0.2% -> Large Enterprises (4,586)

•99.7% -> SMEs (2,827,633)

•0.1% -> unclassified (4,158)

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Source: NSO/OSMEP, 2008.

Distribution of Enterprises by Region

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Distribution of GDP by Enterprise Size in 2008

5

3.45 trillion Baht

4.21 trillion Baht

Distribution of Employment by Enterprise Size in 2007

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8.9 million

2.81 million

The statistics by region, GDP value, and employment rate between large-sized enterprises and small and medium-

sized enterprises for analyzing CSR movement in Thailand showed that:

•Both LEs and SMEs play a major role in the country’s GDP value.

•SMEs create employment more than 3 times of LEs.

•The trend of CSR movement in most LEs (70%) should occur in Bangkok and vicinity, while movement in most

SMEs (70%) should occur in the provincial areas.

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Thaipat Institute has conducted a survey on CSR awareness in 76

provinces all over Thailand through the training forum under

CSR Campus project in 2009, sponsored by three corporations: CAT Telecom, DTAC, and Toyota.

There were about 6,300 participants involved.

In Bangkok and vicinity area, 69.54% showed awareness of

CSR and 30.46% are unaware of CSR. In the provincial region,

38.32% showed the awareness and 61.68% are unaware. The

survey had a total of 4,350 respondents.

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CSR awareness in Thailand

Very high (0.7364 to 0.9589)

High (0.514 to 0.7364)

Medium (0.2917 to 0.514)

Low (0.0692 to 0.2917)

Coverage of OECD Guidelines Issues

Note: Adapted from overview of selected initiatives and instruments relevant to corporate social responsibility, OECD, Page 12.

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 OECD MNEGuidelines

ILO MNE Declaration

UNGlobal Compact

GRISEC

Guidelines

General Principles

Disclosure

Employment

Human Rights

Environment  

Bribery   (Anti-Corruption)

Consumer Interests    

Competition      

Taxation      

Cross-Sectoral and Sectoral or Regional Initiatives

1.Private sector CSR initiatives - major initiatives include the Thai Business Council for Sustainable Development or TBCSD (1993), Thailand Responsible Care (1996), Social Venture Network Asia (Thailand) or SVN-Thailand (1997), and CSR Club (2009);

2.Government-developed CSR initiatives - major initiatives include Thai Corporate Social Responsibility Requirement (according to Thai Labor Standard: TLS.8001-2546) or TCSR (2003) Corporate Social Responsibility: Department of Industrial Works (according to ISO 26000) or CSR-DIW (2008), and Social Responsibility Mark or SR Mark (2009);

3.Non-governmental CSR initiatives - major initiatives include Population and Community Development Association or PDA (1974), The Network: NGO and Private Sector Cooperation for Sustainable Development (2004), and Thai CSR Network (2005).

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The Way Forward…NCP: the effective tool for promoting RBC in Thailand

Four recommendations for taking CSR forward

1.Strengthen understanding of CSR on accuracy and thorough basis

2.Integrate CSR throughout the organization

3.Communicate CSR on factual and timely basis

4.Pursue sectoral initiatives in industries having significant impact on country economy

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1. Strengthen understanding of CSR on accuracy and thorough basis

Action Points:

1.Government should promote in educating CSR knowledge through various media to create awareness, and support training activities, especially for SMEs.

2.Private sector should cooperate as a learning network in CSR organized by a host such as Federation of Thai Industries, and the Thai Chamber of Commerce as a facilitator since they have member base nationwide.

3.To encourage the academia, particularly higher education institutes, to produce textbooks, and learning materials in CSR, including creating academic exchange and producing CSR research by partnering with international institutes.

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2. Integrate CSR throughout the organization

Action Points:

1.Government should create a positive environment for CSR practices by creating incentives or positive measures to support the integration of CSR in business processes to enhance responsible business practices in broader context .

2.Business should define appropriate CSR strategies for the organization, including competency that support CSR practices and inline with the company potential.

3.Develop a management system and measures in various levels of enterprises including line of work as a tool for diffusing CSR practices throughout the organization.

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3. Communicate CSR on factual and timely basis

Action Points:

1.Government should create tools to monitor and control media usage in misconduct, propaganda that builds an incorrect understanding or a severe negative impact to the society.

2.Businesses should assess the communication performance on CSR in the way that they will not diminish real value of CSR performance. Also taking into account the communication in respond to relevant stakeholder interest.

3.Media should serve as a gate keeper to provide good examples to the society and actively filters misappropriate content.

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4. Pursue sectoral initiatives in industries having significant impact on country economy

Action Points:

1.Government should encourage the export business, especially in machinery, electrical equipment and automobiles to prepare or participate in the relevant sectoral initiatives.

2.SMEs in the export business may be affected by CSR measures form foreign business partners. It is important to focus on standards and guidelines especially those in jewelry and gems, plastic, and rubber industries.

3.Agencies like Federation of Thai Industries or Thai Chamber of Commerce should work towards building knowledge and understanding of new global trade context and how it is being affected by CSR factors for their members

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