by DESMOND LAM
Corporate Social Integration in Macao by Desmond Lam.
Corporate Social Responsibility (CSR) has been a popular issue for many years now. It grows out of the community’s and social groups’ expectations that companies should not only care about short-term profits. Because most companies operate within the boundaries of human communities, they should also have social responsibilities that they are obliged to fulfill – to make the world a better place to live in. Companies should consider the impacts of their business activities on all stakeholders including their customers, trade partners, employees, investors, and community. Needless to say, some companies view CSR as a way of giving back. Others see it simply as public relations. These traditional views of CSR are too narrowly defined. While there is widespread adoption of the concept due to societal pressure, many companies and people still think CSR does not make good business sense. The fact is: CSR can mean more than good business – it can be a way to achieve a sustainable competitive advantage for Macao’s six casino operators.
Certainly, every casino operator in Macao should have a CSR department or similar. But this is not enough. Every operator should embrace a CSR concept and develop a CSR vision. I said ‘a’ and not ‘the’. There is no single (‘the’) ultimate model of CSR that every operator in Macao should follow. Let’s face it: one operator cannot do everything that the society seeks. But together, they can make a difference. That is because each operator in Macao has distinctive resources that it can best use to integrate with its operating environment. A more streamlined approach towards CSR by each operator, based upon its strengths and weaknesses, would better benefit both the Macao/Chinese community and the government. Finding a balance between corporate resources, profit objectives, and social expectations is a key factor in CSR concept. It is not just about social responsibility; it is about socially integrating the operator’s values with societal values – a delicate balance of values. Operators must realize that in operating a casino in Macao, they should find common values between themselves and the Chinese society. These values become essential for business sustainability.
There are some businesses that are perceived to be worse than others in potentially destroying social values – gaming is simply one of them. Just look at the major countries in Asia and you realize why so. Most Asian countries and their people are still unreceptive towards legalizing gaming – even Macao and Singapore. Asian governments are still trying to find a ‘right’ balance between economic growth and potential social disorders as a result of gaming legalization. How can they be blamed? In the past decades, there have been so many studies and subsequent coverage on the negative aspects of gaming (i.e. from the Western countries) that one almost forgot about the benefits of the gaming industry to society as a whole. Gaming can be a healthy and fun business with minimal damage to the society at large. Addiction is inevitable in many product usages (e.g. think Coke, junk food, computer games, and Internet) and can (and should) be contained – unless we ban these products and wipe them off the face of earth.
Being socially responsible can be good business for casino operators in Macao. It can help an operator to achieve a competitive advantage that is sustainable. So, CSR should not be looked upon as just public relations. Many companies see it that way but that is wrong. It is much more than that. One can approach CSR as a business model like any other business or marketing strategies. A good CSR model requires an operator to examine its internal and external environment. Internally, an operator should first investigate all its business functions and contact points with its key stakeholders (i.e. customers, employees. trade partners, government, investors, etc). We do so to see how these functions (i.e. their strengths/weaknesses and activities) may potentially create negative or positive social impacts on which we can act on later. Externally, an operator should examine its outside environment like its customers, physical environment (e.g. infrastructure, labor, health-care services, rules and regulations), competition and partners. We do so in order to determine the opportunities and threats relating to social values and order. We should constantly seek common values between us and our external environment. In this way, we match our internal resources to the needs of our external environment – an exercise that we frequently do when determining an appropriate business or marketing strategy. We can call this process - Corporate Social Integration. The operator that best integrates its internal to its external environment will gain a competitive edge over other incumbents.
CSR is a desirable practice for all casino operators in Macao. Casino operators should start to think of CSR as a strategic approach to managing their businesses in Macao; not just public or community relations. They should also proactively manage their CSR programs instead of managing their activities on an ad-hoc basis. A change of mindset is definitely needed in Macau even though each operator would claim that they are constantly ‘giving-back’ to the Macau community. Having a CSR department to coordinate activities with key stakeholders is just a tiny first step. What is more important is to embrace CSR within the entire organization, from top to bottom and within the corporate structure. Remember that a good CSR strategy can lead to a competitive advantage. It is about socially integrating with your environment in order to achieve better things together. It is about business sustainability. This should be the way forward for all casino operators in Macao.
NB: This article was originally published in Macau Business (June 2008).
Date Posted: 20-Sep-2010
Desmond Lam is an Associate Professor of Marketing at the University of Macau. He can be contacted at DesmondL@umac.mo.