Let irresponsible firms feel pain of misconduct

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Let irresponsible firms feel pain of misconduct

Source: Global Times
[00:57 July 21 2010]
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By Chen Chenchen

Zijin Mining Group, China's biggest gold producer, is under fire in a river pollution scandal. At one of its copper plants in Fujian Province, 9,100 cubic meters of waste leaked into a nearby river on July 4, killing tons of fish. The group didn't report the accident until nine days later.

This pollution scandal reminds the public of BP's oil spill in April. The British oil giant has guaranteed $20 billion to compensate local shrimpers, restaurateurs and other victims of the environmental disaster.

In order to bankroll the victims' fund, the company claims it will sell off assets. While its brand value plunges downward, BP has been on a media and advertising campaign since the spill, trying to repair its corporate image.

In contrast, Zijin Mining appears arrogant and irresponsible. After the leakage, the group quibbled that they didn't report the accident initially because they didn't want to "trigger social panic."

Facing public censure, the group issued an apology on Monday, which many people have shrugged off as "insincere."

Many people castigate Chinese enterprises for their seeming lack of social responsibility. But how does society encourage such enterprises to develop social awareness?

Since 2008, when a series of scandals concerning food safety, pollution and construction quality were disclosed, the public has endlessly pleaded with businesses to develop a social conscience. However, without a legally binding mechanism, this civic responsibility merely appears to be a company's moral obligation.

A comprehensive evaluation of corporate social responsibility is urgently needed. Since 2008, the Red Cross Society of China has joined hands with scholars to build a social responsibility evaluation system for the auto industry, releasing an annual ranking of manufacturers who have acted responsibly.

Local supervision departments can use the Red Cross model to rate social responsibility in other industries. Awards and penalties should also be considered for the winners and sinners.

There is a bottom line to social responsibility that should never be trespassed by any company, no matter how big or prosperous it may be.

As we saw in the Zijin scandal, dozens of local officials were vulnerable to bribes or had lucrative no-show jobs in the group. As a colossal corporate taxpayer with a powerful guanxi (connection) network, the group ignored supervision and neglected environmental monitoring standards.

Early in May, the Ministry of Environmental Protection publicly criticized Zijin Mining. However, the group chose to ignore the criticism and failed to make corrections.

Each enterprise has a social responsibility to create a better world. Self-awareness of business ethics must begin with a rigid and impartial surveillance system to make irresponsible firms feel the pain of their misconduct.