In recent years, Corporate Social Responsibility (CSR) or Sustainable Business Development has become an increasingly important topic in Taiwan. The private sector gives out numerous CSR awards, and universities are offering courses in the subject. New products, services, and businesses related to CSR are being created. This has become a new movement in capitalism and a new mainstream doctrine for businesses.
Important issues in sustainability have been discussed in the United Nations since the establishment of the Commission on Sustainable Development. In 2000, 189 countries endorsed the Millennium Development Goals (MDGs)—which served as a precursor to the Sustainable Development Goals (SDGs)—as an attempt to address these issues through the joint effort between the government and the private sector. The financial crisis in 2008 underscored the need to rethink the role and mission of private businesses in society.
The promulgation of the Corporate Social Responsibility Best Practice Principles for TWSE/GTSM Listed Companies in 2010 marked the beginning of the promotion of CSR in Taiwan. Working with the Taiwan Stock Exchange, I contributed to the drafting and passage of this law after years of advocating CSR, which began when I was working at the Taipei Exchange in 2005. However, it was not until 2014, in which a string of food, occupational, and aviation safety incidents occurred, that the government finally devoted much attention to this issue and started to require companies in certain industries and publicly listed companies to publish CSR reports, the first step towards actual implementation of CSR by businesses. By the end of 2017, 515 CSR reports had been published, with 88% of the top 100 companies in Taiwan issuing CSR reports. Taiwan was late to the CSR game, but its performance in recent years have outshined those who started early.
According to the 2017 Bloomberg Environment, Society & Governance (ESG) disclosure scores, Taiwan has seen its ranking rise to number two in the world, second only to France and ranked above countries such as the United Kingdom, the United States, China, and Japan. Evidently, businesses in Taiwan have greatly raised their awareness of transparency of CSR activities.
As for performance in the capital markets, Taiwan has 17 companies that are included in the 2017 Dow Jones Sustainability Emerging Markets Index, making it the country with the most companies included in the index. Taiwan is also number 11 on the Dow Jones Country Sustainability Ranking, ahead of countries such as Canada and Finland.
President Tsai has been an advocate for a "circular economy" since she took office; though many Taiwanese companies are already long-time practitioners of the concept, and quite a few have received both domestic and international recognition for their achievements in this area. In the past, operating under the rules of a linear economy, the rate at which Taiwan consumes its resources far outpaces its economic growth. However, under the framework of a circular economy, the recycling rate in Taiwan has reached 58%, an accomplishment that is unmatched by many countries in the West. The WTO has asked Taiwan to share its recycling experience; the EU has invited Taiwan through the Ministry of Foreign Affairs to attend video conferences on the subject. The 2016 Taiwan-EU Green Summit was held in Taiwan so that EU countries could directly learn from Taiwan. The EU has continued to invite Taiwan to attend international conferences on the topic of circular economy, which shows the Taiwan’s achievements in this area are acknowledged by the international community.
In recent years I witnessed multiple Taiwanese companies frequently win international sustainability awards, demonstrating their “green power” on a global stage. I strongly believe that combining CSR thinking with the core competency of a business will be the key to raising the competitiveness of Taiwan in the future.
For example, for more than 50 years, Spring Pool Glass in Hsinchu primarily engaged in glass recycling. It recycles around 100,000 tons of glass every year, reducing carbon emissions that equal that of ten Da-An Parks. I personally visited this company and discovered that they do not simply recycle glass into new material, but also strive to enhance the economic value of glass itself, like creating environmentally friendly building materials and winning design awards. More recently, they added elements of art and culture to their products, working with Michelin chef Andre Chiang and calligrapher Ho Ching Chwang to create fabulous artwork out of glass, and becoming a new spotlight enterprise in Taiwan.
Wu Ting-An, who is one of the second generation owners of Spring Pool Glass and special assistant to the chairman told me: “The highest level of the circular economy is to move beyond recycling and increase the added value of the product to the point that it is no longer perceived as an recycled item.”Glass was once a type of waste that was difficult to dispose of since it does not break down and cannot be burned. But glass can be fully utilized after recycling without losing its original quality. HEC Lausanne in Switzerland used the recycling rate of glass as an indicator for the competitiveness of a country. Globally, Taiwan has the second highest glass recycling rate, ranking only behind Sweden.
The cement industry was once viewed as the top culprit for the destruction of the environment. As one of the top 12 cement companies in the world, Taiwan Cement has taken the initiative to minimize the environmental impact of its business practices by actively developing its environmental service business. The most notable achievement is the three-in-one plant in He Ping Industrial Park in Hualien County, which reuses the waste produced by the cement factory, harbor, and power plant through an internal circulation design. The final output from this plant are cement, power, and carbon dioxide. It also built a test facility that uses calcium looping to capture carbon dioxide, a technology that won the recognition of the R&D 100 Awards, known as the “Oscars” of industry innovation awards.
As CSR becomes a global universal value, it no longer represents passive compliance of laws and regulations or donations to charity; instead it is treated as an opportunity to transform a business into a key player in a sustainable economy. If a business can incorporate CSR principles in its vision and operational strategies, it could lead to a new business model that involves mutual beneficial arrangements with all parties in the supply chain. This creates new value for the business, attracts investors in sustainability from around the world, and builds a future of sustainable profits!