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Transcript of 透過企業社會責任分析對台灣永續能源政策框架 - 中 華 大 學 碩 ...
中 華 大 學
碩 士 論 文
透過企業社會責任分析對台灣永續能源政策框架
之企業回應:以華碩個案為例
“Analyzing the Corporate response to the
Taiwan Sustainable Energy Policy Framework
through Corporate Social Responsibility: The
AsusTek case.”
系 所 別:行政管理學系碩士班
學號姓名:M09717021 卜拉克
ARISTOTLE MATIAS BULACLAC
指導教授:陳春山博士
柯志昌博士
中 華 民 國 100 年 8 月
I
摘要摘要摘要摘要
公部門與私部門的合作是國家一種發展的方式。除了經濟及社會發展影響以
外,公部門與私部門的合作也是測量,評估和分析公共政策的方法。這種夥伴關
係的公共及私人部門引導到什麼叫企業社會責任。
其中一個緊迫的社會問題,現在是氣候變化。溫室氣體排放推動了聯合國發
起的聯合國全球的影響,鼓勵國家和私人公司在努力減少溫室氣體排放和碳排放
是造成全球變暖,由於氣候的變化。
中華民國在台灣,不是聯合國的成員在努力參與這個社會環境的努力,推出
了台灣永續能源政策框架。該研究主要集中在私營部門如何回應市民的政策,以
及如何可用於分析和評估政策。這項研究將利用台灣再生能源政策框架作為政策
模式和華碩電腦有限公司作為模型為私營部門。
關鍵詞關鍵詞關鍵詞關鍵詞::::企業社會責任,公共和私營部門的合作,氣候變化,可持續能源政策框
架
II
Abstract
The partnership of the Public and Private sector has been one of the pillars of
State development. This doesn’t only contribute to the growth of the State’s economy
and social development but also a means in measuring, assessing and analyzing public
policy. Analyzing policies has been important in the development of a State and also
in improving the way authorities govern.
The partnership of the Public and Private sector is channeled to what is called
Corporate Social Responsibility (CSR) wherein the corporate and industrial sector
contributes in the development and governance procedure of the government by
contributing financially, procuring and creating projects in developing the community
or responding to the governments call through compliance and participating in
enforcing public policies in solving societal problems and social issues.
One of the pressing social issues now is Climate Change. The fast meltdown of
the Arctic glaciers and the high level of the Greenhouse Gas (GHF) emission drove
the United Nation to launch the UN Global Impact to encourage countries and private
firms in the effort of reducing the GHG emission and carbon emission that contributes
to global warming due to climate change.
The Republic of China in Taiwan, not a member of the UN Global Compact, in
effort to participate in this socio-environmental endeavor, launched the Taiwan
Sustainable Energy Policy Framework. The object of the policy is to reduce carbon;
the government started the Carbon Footprint Label system. Early January 2010,
Taiwan’s Environmental Protection Administration, first applied the labeling to
PET-bottled beverages, candles, CDs and cookies. The corporate reception on the
Carbon Footprint policy was characterized by companies striving to have their
products labeled with Carbon Footprint (CFP). Among the big Taiwanese companies,
III
AsusTek Computer, Ltd. Receives the world’s first carbon footprint label for notebook
computer in 2009 and received the Taiwan Carbon Footprint label following its global
success. This is through the company’s green policy for its Corporate Social
Responsibility. In answering to the government’s policy on environmental protection,
AsusTek used its Corporate Social Responsibility to perform its task in helping the
government realize its goal for a better and carbon free Taiwan.
The research focuses on how the private sector response to public policy and
how it can be used in analyzing and evaluating policies. The study will attempt to
measure the level of responsiveness of the private sector and how it affects public
policy especially in realization of the policy implementation. The research will use
Taiwan Renewable Energy Policy Framework as a policy model and AsusTek
Computer Ltd. as model for private sector.
The research will attempt to create a new concept on how to measure and
analyze policy responsiveness through the Corporate Social Responsibility (CSR) and
how it would help in developing a new form of Participatory Governance through
Social Responsible Investment (SRI) and Environment Social Governance (ESG)
which are a CSR system. With these, private sector can participate in governance as a
stakeholder in the public affairs and government and society as stakeholders in the
corporate affairs.
Keywords: Corporate Social Responsibility, public-private cooperation, climate
change, Sustainable Energy Framework Policy
IV
Table of Contents
Abstract-------------------------------------------------------------------------I
Table of Contents-------------------------------------------------------------IV
List of Figures-----------------------------------------------------------------VI
Acknowledgement-------------------------------------------------------------VII
Chapter I
Introduction--------------------------------------------------------------------1
1.1 Background Information: Corporate Social Responsibility----------1
1.2 The Research Issue: Climate Change and the Government----------4
1.3 The Corporate Response: ASUSTek’s Green CSR -------------------7
1.4 Purpose of the Study ------------------------------------------------------9
1.5 Definition of Terms --------------------------------------------------------9
Chapter II
Review of Related Literature-----------------------------------------------11
2.1 Taiwan Sustainable Energy Framework:
In Quest for Security or Sustainability? ------------------------------------11
2.2 Public and Private Partnership through
Corporate Social Responsibility and Inter-Organizational
Cooperation--------------------------------------------------------------------------24
2.3 Why CSR?: CSR in Taiwan Perspective------------------------------------33
V
Chapter III
Methodology-------------------------------------------------------------------37
Chapter IV
Data Analysis------------------------------------------------------------------46
4.1 ASUS Eco Product and Its Labelling-----------------------------------47
The ASUS CSR Comparison-------------------------------------------------53
Acer------------------------------------------------------------------------------54
Toshiba--------------------------------------------------------------------------57
Dell------------------------------------------------------------------------------60
Apple----------------------------------------------------------------------------62
Comparison Matrix------------------------------------------------------------65
Green ASUS and its impact---------------------------------------------------67
Chapter V
Suggestion and Conclusion---------------------------------------------------72
Reference-------------------------------------------------------------------------77
VI
List of Figures
Fig. 1.1 Corporate Social Responsibility Framework-------------------------------3
Fig. 2.1 Framework of Indicator of Taiwan Sustainability-------------------------23
Fig. 3.1 The Roots of Competitive Advantage----------------------------------------38
Fig. 3.2 Dimension of Research Design-----------------------------------------------41
Fig. 3.3 Dimension of Research Concept ---------------------------------------------42
Fig. 3.4 Research Process Flow---------------------------------------------------------43
Fig. 3.5 The Factors that Affect ASUS CSR-------------------------------------------44
Fig. 5.1 Development Progress of Renewable Energy of President’s Committee of
Advisors on Science and Technology--------------------------------------------------75
Table 4.1 ASUS Product with EPEAT Gold (Taiwan) --------------------------------48
Table 4.2 The ASUS and ACER Green CSR Comparison-----------------------------56
Table 4.3 The ASUS and Toshiba Green CSR Comparison---------------------------59
Table 4.4 The ASUS and Dell Green CSR Comparison-------------------------------61
Table 4.5 The ASUS and Apple Green CSR Comparison-----------------------------64
Table 4.6 Matrix of Comparison----------------------------------------------------------65
VII
Acknowledgement
First and above all, I would like to thank the Divine Providence for giving me
His Divine Guidance and wisdom to write this thesis. He knows that this is in effort to
make a difference to this world that He created and the world we are called to love
and cherish. I would like to thank my family for all the support despite of my distance.
To my thesis advisers, Prof. Louis Chun-shan Chen, Ph.D. and Prof. Chi-chang Ko,
Ph.D.,for their unceasing guidance and for imparting a lot for me. To our department
head, Prof. Tai-jing Li, Ph.D, who gives all his support to graduate students in our
department. To Prof. Chien-yuan Tseng, who supported me and made it possible to
have a part of this work published and presented in the 2011 North America Taiwan
Studies Conference at the University of Pittsburgh, USA. To all the professors of
Department of Public Administration and its staff for moral support. To Prof. Tai-kuo
Cheng, who served as one of the committee for my oral defense. To Mr. Frank Lin of
ASUS for giving me a glimpse of how the company’s CSR works. To Business
Council for Sustainable Development of Taiwan (BCSD) for accepting me as their
intern. To my colleagues in the North America Taiwan Studies Association (NATSA).
To my Yuliya, who in a way lessened my stress.
This thesis is for the people of Taiwan and for all who wishes to make this world,
a better place.
1
Chapter I
Introduction
1.1 General Background Information: Corporate
Social Responsibility
The partnership of the Public and Private sector has been one of the pillars of
State development. In partnership, private sector performs some programs and
projects the government wishes to create for the betterment of the society in
addressing societal concerns. Partnership, ergo, is more holistic in terms of
public-private dynamics, wherein private sector is deemed as a part of the governance
process, as a stakeholder not just a mere compliant to the governmental enactments
that is more commonly viewed as public and private cooperation. With the
public-private partnership, the relationship of the two sector revolves in the idea that
everybody is a part and responsible to the affairs of the State and everyone must
participate in the socio-political process, thus participatory governance emerges. The
partnership of the Public and Private sector is channeled to what is called Corporate
Social Responsibility (CSR) wherein the corporate and industrial sector contributes in
the development and governance procedure of the government. Corporate Social
Responsibility or CSR for short is a form of corporate self-regulation integrated into
a business model. It functions as a built-in, self-regulating mechanism whereby
business monitors and ensures its active compliance with the spirit of the law, ethical
standards, and international norms. The goal of CSR is to embrace responsibility for
the company's actions and encourage a positive impact through its activities on the
environment, consumers, employees, communities, stakeholders and all other
2
members of the public sphere. It aids the government by contributing financially,
procuring and creating projects in developing the community or responding to the
governments call through compliance and participating in enforcing public policies in
solving societal problems and social issues. It would promote the public interest by
encouraging community growth and development, and voluntarily eliminating
practices that harm the public sphere, regardless of legality. CSR is the deliberate
inclusion of public interest into corporate decision-making, that is, the core business
of the company or firm, and the honoring of a triple bottom line: people, planet,
profit.
A more common approach of CSR is philanthropy. This includes monetary
donations and aid given to local organizations and impoverished communities in
developing countries. Another approach to CSR is to incorporate the CSR strategy
directly into the business strategy of an organization. Another approach is garnering
increasing corporate responsibility interest. This is called Creating Shared Value, or
CSV. The shared value model is based on the idea that corporate success and social
welfare are interdependent. (See Fig. 1.1)
3
Fig. 1.1 Corporate Social Responsibility Framework
(Source: Wikipedia CSR Framework Value 1 jpg.)
This research revolves on the parameter of the government and corporate
partnership through a channel known as the corporate social responsibility. The issues
of which the paper considered the notion that in analyzing the partnership of public
and private sector, we can analyze the private compliance to the public policy or shall
we say the establishment of business ethics to promote to foster a harmonious
business environment within the realm of the State. CSR then is a mean of corporate
sector to participate in the State affairs through their corporate policy. Corporations
are called to participate actively in helping to address societal issues such as human
development, literacy, livelihood, social justice and environmental protection. CSR
then became an agora or meeting place for the public realm which manages the state
and the corporate realm which controls the behavior of the market. CSR became the
4
aid of the government in serving the society as well as the aid of companies to create
favorable corporate image as well as an avenue for “giving back the profit to the
people”. These may be in terms of social services, service improvement or the most
urgent environmental concerns.
1.2 The Research Issue: Climate Change and the
Government Response
One of the pressing social issues now is Climate Change. The fast meltdown of
the Arctic glaciers and the high level of the Greenhouse Gas (GHF) emission drove
the United Nation to launch the UN Global Impact to encourage countries and private
firms in the effort of reducing the GHG emission and carbon emission that contributes
to global warming due to climate change. Climate change usually refers to changes in
modern climate. It may be qualified as anthropogenic climate change, more generally
known as global warming or anthropogenic global warming (AGW) which is the
increase in the average temperature of Earth's near-surface air and oceans.
According to Karl TR, et. al. (2003), Greenhouse gases greatly affect the
temperature of the Earth; without them, Earth's surface would be on average about
33 °C (59 °F) colder than at present. Note that the greenhouse effect produces a
temperature increase of about 33 °C (59 °F) with respect to black body predictions
and not a surface temperature of 33 °C (91 °F) which is 32 °F higher. The average
surface temperature is about 14 °C (57 °F). Due to the high greenhouse producing
greenhouse effect, sudden increase of temperature occurs that produces the so called
Climate Change. Since the rapid increase of industry, the burning of fossil fuels which
are of great importance because they can be burned (oxidized to carbon dioxide and
5
water), producing significant amounts of energy per unit weight,
and deforestation leading to higher carbon dioxide concentrations in the air, the rate of
carbon emission increases contributing to the high amount of greenhouse gas (GHG).
The issue then is the carbon emission level usually high on industries that
consumes high energy. In order to sustain the high requirement of energy for
production, the demand for the combustion of fossil fuel is high creating a high level
of carbon emission. Taiwan, being one of the economies that are laid on high
technology and industries, has a high demand for energy consumption to sustain its
industry based economy. Per capita energy use in Taiwan is on par with several of its
neighboring countries in Asia. However, energy intensity levels in Taiwan compared
to other developed countries tend to be relatively high. This is due primarily to the
country's heavy concentration of energy-intensive manufacturing industries. Taiwan's
per capita carbon dioxide emissions have been increasing, and in 2003 represented
more than four and a half times the amount of per capita carbon dioxide emissions in
China (12.4 compared to 2.7 metric tons). Taipei has the most obvious air pollution,
primary caused by the motorbikes and scooters used by millions of the city's
residents.
The Fifth Six-Year Plan that was passed by Taiwan's Executive Yuan states that
Taiwan's major environmental problems will be addressed, which was enacted by year
1997. Population density, high energy consumption due to big industries, industrial
wastes and rapid conversion of lands into industrialized zones are issues contributing
to the increase of Green House Gas Emission and the increase of carbon that
contributes to the climate change and the vulnerability of Taiwan in facing natural
disasters. In a report of the U.S. Energy Information Administration states that:
6
Taiwan is grappling with the environmental ramifications of building one of Asia's
richest economies through a decades-long commitment to economic growth.
Environmental issues include the pollution of air and water in urban areas, stores of
nuclear and toxic wastes, loss of fisheries and coastal ecosystems, and an overall
degradation of the country's natural landscape.
In order to create a win-win-win solution in energy, environment, and economy,
sustainable energy policies should support the efficient use of limited energy
resources, the development of clean energy, and the security of energy supply. Passed
on June 5, 2008 by the Executive Yuan, the Sustainable Energy Policy Framework
will answer Taiwan’s energy problem given the fact that Taiwan is insufficient in
natural resources, and constrained by limited environment carrying capacity.
According to the Taiwan Sustainable Energy Policy Framework, Sustainable
energy development should balance the objectives of energy security, economic
development and environment protection, and consider the need of future generations.
It aims to: 1.) Improve energy efficiency 2.) Developing clean energy
3.) Securing energy supply. The policy aims to reduce the carbon emission of
Taiwan to 2000 level by year 2025. In the efforts to achieve the 2000 level of carbon
reduction target of Taiwan by 2025, the Cabinet-level Environmental Protection
Administration (EPA) worked on a system to label the carbon footprints of
consumption products as part of efforts to reduce greenhouse gas emissions. This
paved way to the many Carbon footprint labels on most of Taiwan’s products mostly
from the IT-based such as electronic devices, gaming consoles and computers.
7
1.3 The Corporate Response: ASUSTek’s Green
CSR
ASUSTeK Computer Incorporated (華碩電腦股份有限公司) is a multinational
computer product manufacturer headquartered in Taipei, Taiwan. Its product range
includes motherboards, laptops, servers and mobile phones. The company also
produces components for other manufacturers, including Dell, Falcon Northwest,
Hewlett-Packard and Apple Inc.
1ASUS appears in Business Week’s "InfoTech 100" and "Asia’s Top 10 IT
Companies" rankings. Wall Street Journal Asia ranks it number one in quality and
service, and it leads the IT Hardware category of the 2008 Taiwan Top 10 Global
Brands survey with a total brand value of US$1.324 billion.
Using the case of ASUSTek, a Taiwan based computer company, as a model for
corporate response using CSR; the paper was able analyze how the Carbon Footprint
Label System on ASUS products, specifically computers contributed to the
Sustainable Energy Policy Framework. The so called “Green Corporate Social
Responsibility” (Green CSR) of ASUS led the company to create the branding “Green
ASUS”.
2 According to the declaration of Policy by Social and Environmental
Responsibility Policy of ASUS (SERAsus), which was establish 2006, though the first
report on Environment, Health and Safety was first published on 2005, the company
shall:
1 Retrieved from 2008 Top Taiwan Global Brands announced today (2008/10/23)". Brandingtaiwan.org.
2008-10-23. June 1, 2010
2 Retrieved from: http://csr.asus.com/english/index.aspx# February 24, 2011
8
1. Abide by all environmental protection, labor, and safety and health
laws.
2. Conserve natural resources and endeavor to prevent pollution.
3. Reduce environmental impacts and safety risks.
4. Satisfy customer requirements and aim to become an entirely green
enterprise.
5. Facilitate a company-wide promotion of corporate responsibility
particularly social and environmental aspects.
6. 3 Encourage all employees to participate in the program and
continuously improve it.
The corporate policy states that the company is committed to abide by
environmental and labor protection laws, regulations to meet related demands issued
by the government, and vouch to support the global environmental protection, labor
rights and occupational hazard control.
The research tried to address this primary question especially focusing on the
corporate side of the stakeholders and how the corporate sector reaction on the Taiwan
Sustainable Energy Policy Framework. Using ASUSTek as an example, the research
was able discuss the different programs of ASUSTek on its effort to fulfill its duty as
government’s partner in policy action particularly in sustainable development through
Corporate Social Responsibility.
3 Ibid.
9
To wrap up, the research simply analyzed on how the corporate sector reacts on a
certain policy using the avenue so called Corporate Social Responsibility. The thesis
used ASUS to represent the corporate sector and Sustainable Energy Policy
Framework which covers the Carbon Reduction program as a representative for policy.
Specifying CSR, the thesis will look upon the outstanding compliance of ASUS in
having their computers Carbon Footprint Labeled in compliance to the policy.
1.4 Purpose of the Study
The study focused on Policy Response analysis, public-private cooperation,
Corporate Social Responsibility. Therefore this aims to:
1. To analyze the responsiveness of the private sector to public policy
2. To evaluate the nature of public-private cooperation
3. To investigate the social and corporate implication of the Taiwan
Sustainable Energy Policy Framework
1.5 Definition of Terms
This study operated on the following definition of term:
Corporate Response, in this study refers to actions done by the corporate sector
in response to a public policy.
Corporate Social Responsibility, refers in this study as the methodology where
the corporate sector produces programs or schemes either in complying with a public
regulation, collaborative action for social development or as a business model as sort
of marketing or improving the corporate image.
Sustainable Energy Policy Framework is a policy passed by the Executive
Yuan of the Republic of China to improve energy efficiency by more than 2% per
10
annum, so that when compared with the level in 2005, energy intensity will decrease
20% by 2015 and to reduce Carbon and Green House Gas emission. In this paper, the
Sustainable Energy Policy Framework will be the basis for public policy that will be
the independent variable and will be used as the basis of testing the Green CSR of
Asustek.
Green CSR of ASUSTek, refers to the CSR of ASUSTek specifically for
environmental protection.
Carbon Reduction/Offset refers to reduction in emissions of carbon or
greenhouse gases made in order to compensate for or to offset an emission made
elsewhere.
Sustainable Development is a pattern of resource use that aims to meet human
needs while preserving the environment so that these needs can be met not only in the
present, but also for generations to come.
Participatory Governance, in this study refers to inter-organizational
participation particularly non-government sector specifically, corporate or business
sector in participating with the government in implementing, complying and or
collaborating to the policy for social or state development.
11
Chapter II
Review of Related Literature
This study discusses two main issues of literature review. The first is about
pertaining to sustainability, sustainable and renewal energy policy, carbon reduction
and Green House Gas Emission. The second is how both public and private sector
creates a cooperation through corporate social responsibility.
2.1 The Taiwan Sustainable Energy Policy
Framework: In Quest for Security or Sustainability?
Since the 1970s when the world suffered from the Oil Crisis of 1970’s, Taiwan
lacks energy resources and highly depends on import, so it is a top priority to develop
clean, sustainable, and independent energy and achieve the balance among energy
security, environmental, and industrial competitiveness, and reduce CO2 emissions
through various strategies. Taiwan relies on imports for more than 98 percent of its
energy, which leaves the island's energy supply vulnerable to external disruption. In
order to reduce this dependence, the Ministry of Economic Affairs' Bureau of Energy
has been actively promoting energy research at several since the 1990s.
4 As of 2010, in Taiwan, oil accounts for 49.0% of the total energy
consumption. Coal comes next with 32.1%, followed by nuclear energy with
8.3%, natural gas (indigenous and liquefied) with 10.2%, and energy from renewable
sources with 0.5%. Taiwan has 6 reactors and two under construction.
4 Retrieved from: http://www.moeaboe.gov.tw/English/Statistics/EnStatistics.aspx, June 27, 2011
12
The Taiwan government has been active in promoting energy efficiency, and set
a target of energy efficiency of 33% by 2025. This target is higher than Japan's
commitment to APEC with the target of 25%-26% efficiency. The government is
currently assisting 200 major energy users (companies and organizations) in
implementing energy-saving measures.
Taiwan is preparing for the age of high oil prices, and is proactively developing
clean energy, such as solar and wind power and biofuels. The efforts would help
reduce Taiwan's reliance on imported oil, while contributing to the reduction of
greenhouse gases.
The government aims for renewable energy to account for 15% of the nation's
energy by 2025. It would amount to 8.45 million kilowatts, capable of producing 28.7
billion kilowatt hours of electricity. Wind-generated power could create as much as
8.9 billion kilowatt hours of electricity by 2025, comparable to 2.3 times the capacity
of Linkou's thermal power plants. Many domestic companies are now beginning to
work on the development of solar energy, and conservative estimates are projecting
that 1.2 billion kilowatt hours of electricity will be produced through solar power by
2025.
Under the Energy Management Law and the underlying Implementing
Regulations and related measures, companies are encouraged to improve the energy
efficiency of their operations and products. Mandatory programs have been
established for the purpose of energy conservation, including energy audit and energy
efficiency standards for certain electrical and electronic products.
The Energy Commission under the Ministry of Economic Affairs is responsible
for formulating and implementing energy policy and laws, including the programs
13
instituted under the Energy Management Law. The principal responsibilities of the
Energy Commission include:
(1) Supervising general affairs related to energy management to assure the
stability of energy supply;
(2) Accelerating the rationalization of energy pricing;
(3) Promoting the effectiveness of energy utilization;
(4) Preventing energy-related environmental pollution; and
(5) Enhancing energy research and development.
According to Chen, et.al (2007), to promote the development and application of
renewable energy, under the planning and execution of Bureau of Energy of Ministry
of Economical Affairs (BOEMOEA), Taiwan has implemented many measures for
subsidizing the installation of RE apparatus since 2000. Besides subsidizing the
installing expenses, Taiwanese government also provides incentive measures of
finance/tax, such as investment deduction and accelerating depreciation. The
successive growth of the amount of installing cases has apparently constructed the
base of promotion and application of renewable energy; on the other hand, many
barriers to be overcome were continuously discovered during the executing processes.
To effectively remove these promoting barriers, the Energy Commission (the
pre-BOE) issued “Renewable Energy Development Plan” through the endorsement of
Executive Yuan in January 2002. The purpose of this plan is to establish an
inter-ministerial coordinating mechanism of a higher administrative level, which may
focus all resources to be functioned as a working team. In the meantime, to further
establish a systematically promoting mechanism, the Bureau of Energy then pushes
14
the legislation of “Renewable Energy Development Bill”. According to the drafted
plan of this law, the power capacity of renewable energies will be 12% share of the
national power installation capacity by 2020. Furthermore, in the Nuclear-free
Homeland National Conference held in June 2003, government planned that the
power capacity of renewable energy must reach 10% of the total power capacity in the
nation by 2010. However, the share of the power capacity of renewable energy to the
national power installation capacity is only 6.17%, currently, so there is still a lot of
growing space for the development of renewable energy in Taiwan.
According to Chen and Hou(2008), since June 5, 2008, the Executive Yuan
approved the Framework of Taiwan’s Sustainable Energy Policy. It aims to: 1.)
Improve energy efficiency 2.) Developing clean energy 3.) Securing energy supply.
The policy aims to reduce the carbon emission of Taiwan to 2000 level by year
2025.The goal is to improve energy efficiency by more than 2% per annum, so that
when compared with the level in 2005, energy intensity will decrease 20% by 2015.
Supplemented by further technological breakthroughs and proper administrative
measures, energy intensity will decrease 30% by 2025. The carbon emission target is
to reduce nationwide CO2 emission, so that total emission could return to its 2008
level between 2016 ~ 2020, and further reduced to the 2000 level in 2025. The green
energy application is to achieve the share of zero carbon renewable energy in
electricity generation system up to 8% in 2025.
In order to achieve the preset goals and targets, government agencies were
requested to formulate concrete action plans in accordance with the framework. To
ensure the implementation of the proposed Energy Saving and Carbon Reduction
Action Plans would meet reporting, monitoring, and verification requirements, the
15
authorities required that:
1. Quantitative objectives should be established for each task to measure its
performance and facilitate implementation.
2. Carbon reduction targets should be clearly set in all action plans.
3. Monitoring and follow-up mechanisms should be built to regularly review the
effectiveness and performances of the said action plans.
The Taiwan Sustainable Energy Policy Framework can be viewed in a two way
perception basing on which ground the policy was really made for. 5In the article
written in the blog “Taiwan Sustainable Cities”, a blog on Taiwan’s green urban
development, the author reports that Taiwan’s 99 percent dependence on energy
imports is complicated further by dual vulnerabilities to Middle East instability and
fragile cross-strait relations. He further states that as China upgrades its naval fleet
with the goal of obtaining blue-water capabilities -- Taiwan should be increasingly
worried about the likelihood of continued unfettered ocean supply routes around both
the Taiwan and Malacca Straits that, he viewed as China chocking off Taiwan’s oil
supply that Taiwan’s one month sufficient supply would be insufficient to keep its
economy working. Adding to oil, coal, another source of Taiwan’s energy source, a
quarter of its total coal imports, currently, is now relying to China’s increasing coal
imports. The author, concludes, that in order to secure and improve energy situation,
the Executive Yuan made the Sustainable Energy Framework. Whether the rationale
of this policy is to secure Taiwan’s energy source, the bottom-line is that the
government is working towards not only to improve and to produce sustainable
energy but also to protect and conserve Taiwan’s environmental situation hastened by
5 Retrieved from:
http://taiwansustainablecities.blogspot.com/2011/04/taiwans-energy-security-battle.html April 12, 2011
16
carbon emission.
Once Chan, et.al (1998) stated that in the 21st Century, Taiwan will encounter
further environmental challenges at the local, regional and international levels.
Post-Kyoto concerns for climate change will create international pressures to reduce
green house gases (carbon dioxide, methane). The environment and energy are
important domestic and international issues that are now national security concerns
for Taiwan.
The strategic plan is offered for transforming the Taiwan Environmental
Protection Agency (TEPA) to an organization that spearheads the government’s effort
to create a sustainable future. As the “environment” is defined as energy and
material flows in commerce, not just waste, it must be brought to a central function in
government. Therefore, we recommend the formation of a Ministry for
Environment and Resources. However, it is critical that resources explicitly include
responsibilities to affect energy and materials utilized in construction, agriculture,
transportation and industry.
Government needs to apply a new modality to its environmental management
programs. While strict enforcement at all levels of governance establishes integrity, a
new modality uses public persuasion and cooperative negotiations with industrial
sectors. Management personnel will need to enhance their skills in environmental risk
assessment, economic impact assessment, and environmental negotiation to be ready
to implement a new government-industry-citizen partnership era.
The effort of the Taiwan government to achieve its goal, that is reducing carbon
emission to the 2000 level in 2025, Drs. Chen and Hou, in the paper emphasized the
enthusiastic action of the government by requesting government agencies to formulate
concrete action plans in accordance with the Sustainable Energy Framework. The
17
paper clearly shows the sincerity of the government in participating in this global
endeavor of Carbon Reduction especially, that Taiwan is not a member of the UN
Global Compact due to its current status in the United Nations.
Nevertheless, Taiwan is very eager to contribute in this global endeavor. The idea
then is, since Taiwan, technically, cannot involve directly or formally to this
international agenda, Taiwan, using its globalized industries through private firms,
Taiwan’s corporate and industrial sector can serve as a liaison and also a model for
call for carbon reduction compliance through the private participation to the national
policy, Sustainable Energy Policy Framework.
Taiwan, contributed globally through its local policy that contributes to this
international call. We can say, through Taiwan’s local policy that is based on the
global agenda in answering global issue, Taiwan was able to do her share in this
collective action. In order for her to involve the nation’s dynamic yet diverse sector,
Taiwan must encourage sectors to participate in policy implementation wherein for
the corporate sector, through the use of Corporate Social Responsibility. Whether the
Sustainable Energy Policy Framework is more sincere in sustainable development
rather in political and energy security, the effort of the government should, in
principle for the best of its people which is the primary responsibility of the State. The
policy therefore should not only be viewed as a response to economic challenge from
external pressure and natural resource reality but also as a positive and dynamic
response of the government to a global endeavor.
18
The March 2010 issue of PCF World Forum features Taiwan’s Carbon Footprint
Level reaching the Taiwanese Market. The Taiwan Electrical and Electronic
Manufacturer’s Association (TEEMA) came up with its own carbon labeling for
electronic sector. Taiwan is the latest nation to float a plan to label the carbon
footprint of common consumer packaged goods, following in the footsteps of the UK
and Sweden. The labeling program, from Taiwan’s Environmental Protection
Administration, was at first applied to PET-bottled beverages, candles, CDs and
cookies.
In response to the government’s policy on environment, the corporate sector
started their own initiative to create an environment based production and
environment based quality control through carbon footprint labeling on their own
respective products. This simply manifests a positive and active response from the
corporate sector to the public policy.
Since the aim of this paper is to assess and investigate on the corporate response
through CSR, it is very substantial to study how corporation formulate their own
respective CSR programs and how these programs go with the policy and regulations
by the government and societal issues. This will lead on how to corporation and
industries behaves in a given point of issue or agenda. We can conclude then that the
policy is a scenario for a corporate social responsibility taking the philanthropic
approach of CSR as a model. Or, was it a business strategy to answer policy making it
a mere compliance? Ideally, CSR should work as a value formation for business that
means in making or developing business success level is also improving the society
and in hand-in-hand with the government in addressing a societal issue thus creating a
means of a new participatory governance.
19
With the issue of sustainable energy source amidst the scarcity of energy
resources, Taiwan uses energy alternatives that perceived to be efficient yet
sustainable. According to Lee (2006), energy conservation and greenhouse gas
reductions are the major components of the present energy policy in Taiwan. The
production of electricity from nuclear source has resulted in a significant reduction in
atmospheric emissions and in the consumption of conventional fossil fuels from what
otherwise would have occurred.
Over the period 1977-2007, electricity generated by Taiwan's nuclear power
plants averted the following cumulative greenhouse gas emissions: 828 million tonnes
of CO2, 2.3 million tonnes of NOx, 14 thousand tonnes of VOCs, and 5 thousand
tonnes of CH4. In addition, nuclear energy production displaced 330 million tonnes of
coal that would otherwise have been burned to produce electricity by electric utility.
In the paper of Lee, he presented that the use of nuclear energy could reduce
carbon emission. Atomic energy offers a clean energy alternative that frees us from
the shackles of fossil fuel dependence. Nuclear power costs about the same as coal, so
it's not expensive to make. It does not produce smoke or carbon dioxide, so it does not
contribute to the greenhouse effect. It produces huge amounts of energy from small
amounts of fuel. It produces small amounts of waste and nuclear power is reliable.
Although not much waste is produced, it is very, very dangerous.
It must be sealed up and buried for many thousands of years to allow the radioactivity
to die away. For all that time it must be kept safe from earthquakes, flooding,
terrorists and everything else. This is difficult. Nuclear power is reliable, but a lot of
money has to be spent on safety - if it does go wrong, a nuclear accident can be a
major disaster. People are increasingly concerned about this - in the 1990's nuclear
20
power was the fastest-growing source of power in much of the world. In 2005 it was
the second slowest-growing. But, as the price of oil and global warming concerns
both continue to rise steadily, a renewed interest in the clean-burning properties of
nuclear power are becoming much more attractive. The rise of global warming
concerns throughout the world over the last ten years has led to a renewed interest in
what was once considered a dead market.
Will nuclear power answer to the challenge of the current climate change and the
call of the Sustainable Energy Policy Framework? The fact to consider is that will it
suits Taiwan’s present condition and the necessity for it to sustain the nation’s demand
for energy. Taiwan currently has 4884 MWe of nuclear power capacity by means of 3
active plants and 6 reactors, which makes up around 8.1% of its national energy
consumption. This makes Taiwan the 15th largest user of nuclear power in the world.
Given a very limited source of sustainable energy for its fast and dynamic economy, it
is very inevitable for the nation to seek a more long term yet sustainable and clean
source of energy. Nuclear power may answer this concern yet safety and precaution
should also be considered. Considering that Taiwan is prone to natural disaster often
frequented by typhoons, earthquakes and landslides, it also summons images of
disaster.
In this course of issue, two agenda then occurs, the issue of development and the
issue of sustainability. In the course of development, the issue of environment is often
complimentary. Since the industrial revolution in the western world, the issue of
environmental problems started to sprout. Industrialization, which is a means of
development, is often acquainted with the term “pollution” or environmental
degradation. Here comes the question on how these two “opposing” idea of
development and sustainability can be complementary in the lighter side. Can it be
21
possible to attain development without putting sustainability at stake? The object is to
create a well developed economy yet sustainable in nature hence we call sustainable
development. Boulanger (2004) states that social indicators, and therefore sustainable
development indicators also, are scientific constructs whose principal objective is to
inform public policy-making. Their usefulness is dependant on trade-offs between
scientific soundness and rigor, political effectiveness and democratic legitimacy. The
paper considers in this perspective three important stages in the building of
sustainable development indicators: the identification of the various dimensions
underlying the concept of sustainable development, the process of aggregating lower
dimension indicators in higher level composite indices and the attribution of weights
at various levels of the indicators hierarchy. More specifically, it assesses the relative
fruitfulness for indicators construction of the four most widespread conceptions of
sustainable development, in terms of domains or pillars (economy, society, and
environment), in terms of resources and productive assets (manufactured, natural,
human and social capitals), in terms of human well-being (needs, capabilities) or in
terms of norms (efficiency, fairness, prudence…). It concludes with a plea for the
construction of synthetic indices able to compete with and complement the GNP as an
indicator of development.
In the research by Chen, et.al (2008), they tried to establish a standard indicator
in measuring sustainability. The study written by Chen, et.al (2008), utilizes the
method of Material Flow, Ecological Footprint Model and other related indicators to
establish the Indicator System of Sustainable Development. Principal Component
Analysis is used to abstract the representative factors in order to estimate the
indicators of ecological sustainable development during 1998~2005 in Taiwan, as
well as to make policy recommendations. The research indicates following results: (1)
The Direct Material Input (DMI) of Taiwan shows constant instability and depends on
22
heavy import activity. The annual increase of considerable greenhouse gas emission
leads to a comparative growth of the Domestic Process Output (DOP). The both
material consumption and inventory formation of the economy are unsteady. In
addition, the Physical Trade Balance (PTB) indicates that supply exceeds demand, as
well as the occasional shortage of building materials. (2) The 2005 per capita
Ecological Demand footprint in Taiwan is 6.5392 hm2, making the Ecological Deficit
per capita 4.8569 hm2. The figures reflect that productivity and life intensity of
residents have exceeded the carrying capacity of Taiwan’s ecological economic
system. (3) The overall Synthetic Trend Indicators of Sustainable Development in
Taiwan are decreasing. Therefore, if proper measures are not adopted in time, the
current weak sustainability will lead into the vicious circle which departs from
sustainable development.
Since about 1970, economic growth ceased to be considered the most important
criterion for measuring urban development. Instead “development” has come to
encompass other aspects such as environmental quality and the provision of public
service. Sustainable urban development must be more than merely “protecting” the
environment; it requires socioeconomic adjustment in order to reduce the need for
environmental remediation (OECD, 1990). According to Huang, et.al (2001),
urbanization in rapidly industrialized countries has been particularly unsustainable.
Evidence of progress in urban sustainability is important in justifying urban
management policies. To assess the trend of Taiwan’s sustainability, a research team
from various disciplines was organized by the National Science Council of the
Republic of China to develop a system of indicators for measuring Taiwan’s
sustainable development. To emphasize the intensity of urbanization, and its
significance for Taiwan’s sustainability, the framework indicators are divided into
23
“Island-Taiwan” and “Urban-Taiwan” (Fig. 2.1). Following the concept of
pressure-state-response (P-S-R), the indicators of “Island-Taiwan” are categorized
into economic pressure (P), social stress (P), environmental pollution (S), ecological
system (S), and institutional response (R). The development of the P-S-R indicators
are based on island-wide statistics, while the “Urban-Taiwan” indicators are based
mainly on the three metropolitan regions of Taiwan only and that those urban areas
account for 56 percent of the population and 13 percent of the island’s area.
Fig. 2.1 Framework of Indicators of Taiwan Sustainability
(Source: Huang, et.al , 2001)
The NCSD reached consensus on the Taiwan Sustainable Development
Indicators (SDI) during their 16th Assembly on 5 June 2003. The indicators help
assess the progress of sustainable development in Taiwan and respond to the United
Nations' request for each country to establish an indicator system that can be used to
assess each country's efforts toward sustainable development. Taiwan's SDI system is
based on an extended Pressure-State-Response (PSR) framework that is divided into
two systems to address the unique situations of Island Taiwan and Urban Taiwan. A
24
total of 42 core indicators are categorized under the following six dimensions:
environmental pollution, ecological resources, social pressure, economic pressure,
institutional response, and urban sustainable development.
The issue of sustainable energy involves society, government and private sectors
as stakeholders. Public opinions made by the society are vital in formulating a policy
to be enforced by the government wherein to be enhanced though corporate aid
through corporate social responsibility thus creating a participatory governance. To
accurately achieve this, one must take into consideration, social indicator to create
basis for policy formulation and also sustainable development indicator to
complement it.
2.2 Public and Private Partnership through
fostering Corporate Social Responsibility and
Inter-Organizational Cooperation
O’ Toole (2004) emphasized that in fostering inter-organization cooperation, first,
a common interest should be build and used. Secondly, using exchange, cooperation
can be facilitated. Recognizing the significance of different inter-organizational
patterns is one step toward effective implementation. In addition, skillful
implementation managers need to find ways of getting organizations to work together
toward policy success. Inducing implementation success via inter-organizational ties
25
typically requires some combination of generating and tapping common interests, on
the one hand, and/or utilizing exchanges to link units in productive ways for purposes
of policy. Each of these themes deserves attention.
Companies in order to response to governments calling would use corporate
social responsibility as a means. CSR is related to the Values of the corporation,
which endow its management with a sense of identity, stronger stability, give
directions to important issues and guidance for managerial decisions (Deal &
Kennedy 2000). Therefore, Values are the core culture of a company, affecting its
activities and relationships with stakeholders (Valentine & Barnett 2003). Values
regulate the owners’ actions, product quality and also improve trust, loyalty and
effectiveness resulting from enhanced organizational culture (Engelbrecht et al.,
2005).
The World Business Council for Sustainable Development (WBCSD, 1999)
defines CSR as a commitment to improve quality of life for its stakeholders by
conducting ethical business while devoting itself to financial performance. The World
Business Council for Sustainable Development (2003) has further explanations that
CSR initiatives refer to business commitment devoted to sustainable economic
development management with employees, their families, the local community and
society by improving their life quality.
CSR focuses on the need for corporations to go beyond the interests of their
shareholders and address the impact their activities have on a broader social and
environmental spectrum. CSR attempts to counteract any negative effects that
26
corporations have on society and replace them with constructive influence. It has four
components namely employment, customer, environment and society
The treatment of employees by large corporations has often come under scrutiny
by political organizations and human rights groups. Particularly in developing
countries, where many resource extraction industries have extensive operations, there
are ongoing questions about just how equitable working conditions and pay levels are.
CSR seeks to assist corporations in treating both domestic and foreign employees
equitably by providing safe and comfortable working conditions and a fair wage. This
approach continues the ongoing transformation of a corporate mentality that was
common in the nineteenth century, in which the rights of employees barely registered
among the concerns of company owners.
Corporations have an obligation to provide safe, effective and good-quality
products and services to their customers. A purely free-market analysis of this
responsibility would state that these requirements will be met by the dictates of the
market. The philosophy of CSR questions the truth of this belief, and advocates more
proactive intervention into the relationship between corporations and their customers.
Consumer protection initiatives, such as those advocated by Ralph Nader, help to
provide the legal backing under which consumers can challenge what they see as
questionable practices on the part of corporations
Growing public awareness of environmental challenges involving toxins,
resource depletion and climate change is forcing corporations to reconsider the
traditional corporate view of the natural world as an unending cornucopia of resources.
Environmental aspects of CSR encourage corporations to consider the finite nature of
the natural world, and to take much more stringent measures to reduce waste, address
27
polluting or destructive practices and integrate alternative energy systems and
innovative waste-reduction programs. This shift in attitude is particularly critical in
areas of South America and Africa, where corporations have extensive operations but
are not subject to strict oversight and regulation.
In addition to their responsibilities to employees, customers and the natural world,
corporations are responsible for their impact on human society. Many millions of
people who are not employed by a corporation and who do not purchase its products
are nevertheless affected by its activities. CSR recognizes the interrelated nature of
society, and acknowledges that no individual or company can exist totally isolated
from the rest of society. Therefore, corporations need to critically analyze what
impact their activities have, for good or ill, on surrounding communities, and take
steps to maximize the good and minimize the ill.
Will CSR then answers the question on how and how far is the corporate
response to the public policy? As the pressuring issue of sustainability, any
corporation in Taiwan has the duty to take its own social responsibility to help
mitigating the environmental and societal problems while striving for the financial
performance. As stated by Huang (2010), CSR development in Taiwan has been
burgeoning and growing, it is still mostly deemed a random or casual activity rather
than an imperative commitment to corporate value and culture. She elaborated that As
CSR initiatives and their context in Taiwan are still at its preliminary stage, there is
very limited literature and data for reference and study.
Nowadays, as declared by Stainer (2006), organizations are required to be
responsible by formulating, implementing and monitoring strategic policies, not just
28
related to globalization, sustainability, demographics and technology but also to social
responsibility. Most of the companies are merely using CSR as strategy for a business
model or just performing their philanthropic duties. Ideally, CSR should be done to
serve the corporate stakeholders, the society and addressing pressing societal issue in
a long term. Investing in business or programs that would serve the stakeholders best,
would eventually create a value based CSR that is not a temporary solution to societal
issue that philanthropic approach. Therefore, a good relationship with stakeholders
should be established and CSR performance should be evaluated. As noted by
Moskowitz in 1972, corporate Social Responsibility Performance can help attract,
retain and motivate employees, resulting in higher productivity and performance. The
Instrumental stakeholder theory also claims that effective management when starting,
developing or maintaining stakeholder relationships will enhance financial
performance (Jones, 1995).
Corporate Social Performance can also contribute to the function of product
differentiation and will attract socially conscious consumers or socially responsive
investors (Kapstein, 2001). In recent years for instance, Social Responsible
Investment (SRI), an investment strategy which seeks to maximize both financial
return and social good, became a booming market in both the US and Europe. Assets
in socially screened portfolios climbed to $2.71 trillion in 2007, an increase over the
$2.16 trillion counted in 2003 according to the Social Investment Forum's 2007
Report on Socially Responsible Investing Trends in the United States. From
2005-2007 alone, SRI assets increased more than 18 percent while the broader
universe of professionally managed assets increased less than 3 percent. As of 2007
about one out of every nine dollars under professional management in the United
States is involved in socially responsible investing—11 percent of the $25.1 trillion in
29
total assets under management tracked in Nelson Information’s Directory of
Investment Managers. Research estimates by financial consultancy Celent predict that
the SRI market in the US will reach $3 trillion by this year, 2011. The European SRI
market grew from €1 trillion in 2005 to €1.6 trillion in 2007.
From approximately 1990 on, the concept of CSR became almost universally
sanctioned and promoted by all constituents in society from governments and
corporations to non-governmental organizations and individual consumers. Even
international organizations (e.g. The United Nations, World Bank, Organization for
Economic Corporation and Development, International Labor Organization) fully
supported and aggressively established guidelines to continue the movement.
According to a study held by US Fortune magazine, of the Fortune 500 companies
traded in 1977, less than half of these companies embraced CSR as an essential
component in their annual reports. However, at the end of 1990, it was discovered that
nearly 90% of the Fortune 500 companies listed CSR as one of the basic elements of
their organizational goals, actively reporting the CSR events held by these
corporations in their annual reports. From this, it is evident that CSR has received
widespread recognition in many large corporations in the USA. In Taiwan, based on
the results of a 2005 study conducted by Global Views Monthly magazine, merely
27.6% of public listed companies released information on their CSR programs. In
2006, this figure rose to 55.3%; as to foreign companies with branch offices in
Taiwan, the number is 64.3%. From these figures, it is evident that CSR has become
an important factor for Taiwanese and foreign corporations and has become the global
trend. Corporate response strategy to CSR or topics in society can be categorized as
reactive, accommodative, defensive and proactive (Carroll, 1979).
30
As strategy signifies the set of opportunities for creating value and deploying
dynamic capabilities to obtain a competitive advantage (Oliver and Holzinger, 2008),
therefore when a company has motives for value creation or maintenance that drive
the decision to undertake stakeholders’ management, there are two ways to receive
the opportunity advantage in managing stakeholder relations; either to aggressively
influence the stake-holder’s demands and expectations, or to respond to the
stakeholder’s demands to create more opportunities for a win-win situation (Oliver
and Holzinger, 2008). Also, some scholars state that CSR performance can be
evaluated by a corporation’s management of stakeholders, because through the
valuable investment made in these stakeholders, a corporation can increase results and
accumulate a competitive advantage (Clarkson, 1995).
The CSR strategies in this paper are based on value perspective (maintain or
creating value) and strategic orientation (aggressively influencing or responding to a
stakeholder’s demands). The motive for a corporate manager is to maintain or create
organizational value, to place policies and response protocols of social responsibility
in order to obtain opportunities for the development of relationships between
organizations and stakeholders (Wood, 1991). Furthermore, organizations with
specific dynamic capability can further increase the effectiveness of CSR strategies
and improve its organizational performance.
Both sustaining the society and environment, and sustaining the enterprise
require balancing acts between long and short-term strategies and among influential
stakeholders (Roberts, 1992; Pirsch et al., 2007). In these days of rapid pace of
technology advances, and uncertain and changing environment of the global market,
business leaders realize that the strategies in the past are becoming less rewarding
31
(Holliday et al., 2002). Therefore, thinking of new ways to grow and prosper becomes
an important issue among the companies which are keen on sustainable development.
Corporate responsibility represents the way for a firm to engage the process of the
sustainable development that aligns the self-interest of the firm with the greater public
good (Hutton et al., 2007). According to Caroll’s dimensions (1981), the foundation
of a responsible company is to be profitable, but not at any cost. Meanwhile, the
society also demands that the company obeys the law, acts in an ethical manner
toward all stakeholders and be a good corporate citizen. The critical question is how a
corporation can integrate sustainable development strategies into the overall strategy
in order to create the core values and as well to enhance its sustainability. Before
studying the “How” question, the “What” question should be answered- “what are the
key factors affecting the sustainability strategies adoption?”(Law, 2010)
In regards to environment, how environmental issues affect the company’s
behavior especially to its profitability especially when CSR is merely a business
model not as a value creation or participatory governance? Klassen and McLaughlin
(1966) mentioned that environmental management has an important influence on a
firm’s financial performance. Stock market performance is one measure how
environmental management improves financial performance. Furthermore, some
believe that environmental management,for example, eliminating waste will reduce
manufacturing cost (Allen 1992, Schmidheiny 1992).
In contrast, poor environmental management, such as pollution problems will
hurt the firm’s stock price, meaning that the market, shareholders or investors expect
its profitability to be lessened (Shane and Spicer 1983). When the market expects high
future costs for pollution management, a negative impact arises (Stevens 1984). As
declared also in the SRA (Sector Risk Analysis) conducted by CoreRating,
32
environmental problems cause the most serious value impact on the company’s
reputation, branding, morale of employees and competencies. Huang (2010)
concluded that environmental management is important and has an influence on the
financial performance of a firm. It creates profits through either market gains or cost
savings. Sustainable development was initially referring to environmental concerns,
and now also compassing social, ethical and economically issues. Sustainability is a
composite of social, economical and environmental issues (Carroll, 1981, 1999; DJSI,
2006). Sustainable development has been defined as “development that meets the
needs of the present without compromising the ability of the future generations to
meet their own needs”.
A growing number of organizations or firms have begun to adopt corporate
responsibility strategies to contribute to sustainable development goals. These
strategies are aimed at aligning the self-interest of the firms with the greater public
good in ways that add value to both the firms and the society. Asian organizations are
far lagging behind those in the West in having supportive policies and sustainable
development strategies (Welford, 2005). Some Asian countries have moved towards
sustainable development (Mental et al., 2007). Asia has been developing itself in
many areas, within the context of sustainable society, new institutions and
collaborations are formed to drive changes. Facing the challenges from the external
environment, namely the market competition and changing needs on sustainability,
companies in the industry also have internal forces driving them towards sustainable
development. These internal forces involve corporate willingness and the mindset of
being socially responsible by taking sustainability into serious consideration. Both
these internal and external forces definitely promote the propagation of the
sustainable development in the industry. (Law, 2009)
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2.3 Why CSR? : CSR in Taiwan Perspective
An organization is a dynamic social system of cooperative interactions and
relationships. At different stages of the life cycle, these relationships change
depending on the combination of relations, bringing the organization opportunities
and threats for survival (Jawahar and McLaughlin, 2001). The resource dependence
theory states that an organization must rely on valuable resources provided by its
environment to ensure continuous operations, therefore the organization will develop
dependence on stakeholders who can provide vital resources and affect its resource
allocation strategy (Gioia, 1999; Jawahar and McLaughlin, 2001). Furthermore, an
organization’s capability of satisfying major stakeholders’ demands is a key factor
that determines whether an organization can constantly survive and maintain its
competitive advantages (Clarkson, 1995). Due to limited resources, corporations must
identify their major stakeholders in the current life cycle (Agle et al.,1999; Jawahar
and McLaughlin, 2001) and take the step to form an aggressive response strategy
(Jawahar and McLaughlin, 2001). In other words, when an organization’s resource
dependence on certain groups increases, their influence on the company also increases
(Frooman, 1999), hence managers will give greater attention and priority to resource
allocation (Agle et al.,1999).
The high-end electronic market in Asia has been growing in recent years. For
instance, in 2006, the consumer electronics market has grown by has grown by 15.3%,
reaching $54 billion in the Asia Pacific region and by 5%, reaching $3.2 billion in
Taiwan alone. The Asia Pacific region comprises developed and emerging countries
such as Australia, China, Japan, India, Singapore, South Korea, Thailand, Vietnam
and Taiwan, etc. The market values are forecasted to continue to grow (Taiwan by
34
21% and China by 55%), (Datamonitor Industry Profile, 2007). In terms of production
value, Taiwan ranked among the top three producers worldwide for more than 30
products in 2002. The annual change in unit percentage of high-tech manufacturing
(computer-related 27%, components and electronics 19%) shows the prominent and
continual growth of high-tech manufacturing as at 2008 (Department of Statistics,
Ministry of Economic Affairs, Taiwan). The overall production value of the country’s
IC design houses makes up 28 percent of the world share, slightly behind that of the
United States. Meanwhile, leading international firms including Apple, Dell, Fujitsu,
Hewlett Packard, IBM, Siemens, Sony, and Toshiba have all fostered close
partnerships with Taiwan’s enterprises. In addition to their outsourcing and
components procurement businesses, many of them have moved to set up research
and development (R&D) centers in Taiwan.
Taiwan’s industrial development model has mainly focused on original
equipment manufacturing (OEM) and original design manufacturing (ODM). The
OEM or ODM business, rather than producing brand-name products weakens its
competitiveness in the global market. In face of growing market competition, many
domestic high-tech companies are recognizing the importance of innovation by
increasing their investments in related activities. Increasing competition due to trade
globalization forces firms either to put more effort in reducing production costs or
improving productivity. High-tech manufacturers must be able to advance in response
of these fast-pace changes in technology and demand. The operation in the high-tech
industry requires highly sophisticated technologies, skilled labour force and
knowledge in specific technology. The existing practice and know-how of staff may
not fit well into the new environment (Ruigrok and Wagner, 2003). These high-tech
companies need to provide supportive resources and infrastructure to cope with these
changing needs (Silva, 2008). Supportive initiatives and measures are required for
35
both sustainability and competitiveness.
Sustainable development continues to arouse attentions from business leaders.
By definition, sustainable development is to meet the needs of the present without
compromising the ability of the future generations to meet their own needs (Hutton et
al., 2007; World Commission on Environment and Development, 1987; World
Business Council for Sustainable Development, 2002). Business leaders have to strike
a balance between sustaining the planet, society, and sustaining the business.
A company has an obligation to provide a short-term and a long-term value to
shareholders. Corporate social responsibility (CSR) is an obligation both now and into
the future (Hutton et al., 2007). However, business leaders who pay too much
attention to philanthropy or social issues may neglect the primary reason for their
existence and profitability (Murphy, 1994). Activities one constituency finds
acceptable or appropriate may be viewed as undesirable or immoral by another. As a
result, organizations need to develop a clear understanding of the multi-dimensional
constructs of sustainability in order to fight for the balance between profitability and
sustainable development issues.
In the case of Taiwan, for Fang, et. al (2009), they concluded in their paper that,
CSR in Taiwanese society is still in its infancy. Their study has chosen local cases
that have successfully executed CSR response strategies, making them instrumental
examples which focus on the development of theory framework and hold conclusions
that support the propositions in this paper (Creswell, 1998). In other words, using the
case studies of benchmark corporations not only aids in the promotion of the budding
CSR concept in a society, but also serves as a good reference point for corporations
36
seeking to execute CSR. Also, issues on corporate culture can be included to explore
the influence of various cultures on the effectiveness of CSR strategies. These
directions will pave the way in helping us understand the differences in effectiveness
of CSR promotion across corporations.
37
Chapter III
Methodology
Addressing a societal issue is a collective agenda and actions should be taken in
a collective effort. Giving the question of sustainability and the preservation of the
mother Earth as one of the issue, would a policy make a difference in addressing it?
How a policy would be transformed into an efficient action in addressing this issue?
How would the stakeholders participate in the call for action?
In answering these queries, one may think of how the shareholders particularly
the corporate sector participates in this agenda and how it will create an impact on
improving the lives of the society. This leads to the scrutinization of the Corporate
Social Responsibility, the corporate channel of social involvement and a method of
addressing a collective agenda. In this research, which is entitled, “Analyzing the
Corporate response to the Taiwan Sustainable Energy Policy Framework through
Corporate Social Responsibility: The AsusTek case,” the paper tried to answer the
questions through practical observations and careful analysis.
According to Williams, et.al, (2008) the field of empirical CSR research
generally has been hampered by the lack of a consistent definition of the construct of
CSR, as well as its operationalization and measurement. This lack of consistency of
CSR definitions across studies makes it difficult to evaluate and compare the findings
from different studies because they usually refer to different dimensions of CSR.
Most research on CSR has focused on the consequences of CSR implementation—or
lack of implementation—on financial performance with little attention to comparative
issues
38
Fig. 3.1 The Roots of Competitive Advantage
(Source: Hill and Jones, 2008. Strategic Management Theory, p.110)
As analyzed by Porter and Kramer (2006), there are two main categories for CSR
activities, which are responsive CSR and Strategic CSR. A responsive CSR is to act
as a good citizen and mitigate the harm resulted from its daily business activities.
These, as mentioned above, might be deemed by entrepreneurs as a waste of capital
and bring very limited benefit to the company and society. While on the other hand,
strategic CSR can contribute to greater tangible business benefit.
Hill and Jones (2008) define a strategy as “the related actions that managers
adopt to increase the company performance by developing new resources and
capabilities or enhancing the existing resources and capabilities which build up its
distinctive competencies”. The distinctive competencies will enable the firms to shape
up their own functional strategies with superior efficiency, quality, innovation and
customer responsiveness to outperform their competitors either cost-wise or through
differentiation that leads to value creation and Superior profitability. The context of
CSR strategy in question involves the dependence of corporate success on the
relations and interactions between an organization and its stakeholders. For instance,
failure of the industry to satisfy consumer demand or to provide acceptable pricing for
39
safe products and the corresponding post-sale service will result in the collapse of
consumer confidence. Also as part of the international supply chain, companies risk
losing regular orders if they fail to meet environmental regulations required by
downstream customers or are unable to respond more expeditiously than their
competitors. Therefore, corporations must enhance their dynamic capabilities to meet
the changing demands of their various stakeholders. Second, dynamic capabilities also
stress the importance to enhance the productivity of other resources that a firm
possesses in order to increase profitability (Makadok, 2001).
According to Heslin and Ochoa (2008), both responsive CSR and strategic CSR
will affect the business prosperity through the 5 key drivers: growth in market share,
organizational learning, committed and engaged employees, external stakeholders,
financing and investor relations. The closer the social business strategy is related to a
company’s business, the greater it will lever the company’s resources and competency,
and benefit society at the same time.
The research focused more on the responsive CSR of ASUSTek. In 2000, ASUS
officially launched Green ASUS; a company-wide sustainable computing initiative
overseen by a steering committee led by Jonney Shih, the Chairman of ASUSTek
Computer Inc. Green ASUS pursues what the company calls the "Four Green Home
Runs", namely: "Green Design, Green Procurement, Green Manufacturing, and Green
Service and Marketing". Being the first computer company in Taiwan to receive the
Carbon Footprint on its produced computers, ASUS became the leading name for the
so called “sustainable computers”.
The research constructed three main points for assessing ASUS response to the
40
Taiwan Sustainable Energy Policy Framework.
1. The energy efficiency of ASUS produced computers and monitors and how it
contributes to the main goal of the policy that is energy efficient yet
sustainable. A review of material provided by ASUS CSR Specialist Mr.
Frank Lin provided some insights on how the company’s product contributes
to the sustainable energy efficiency. Using a database of ASUS on their
products, the paper was able to derived quantitative data to support the
company’s statement on their corporate social responsibility statement.
2. A Comparative analysis on the CSR Sustainability policy of other computer
company. The paper used ACER to compare ASUS among local companies,
Dell, Apple and Toshiba for international ones. On the comparative section, a
graph was presented showing the compliance to both companies specifically
to ISO certification 14001, ISO certification 9001/9002, and Eco-Labels. A
thorough discussion of the companies’ respective CSR policies and projects
were also discussed and were given commentaries and analysis.
3. The impact of environmental CSR of ASUS to the society. This will include a
literature review on ASUS CSR on environment programs such as
Eco-Products, Regulation Compliance, Product Recycling and End of life
Management and Green house gas Management. This will also include
commentaries on these programs and how these programs support or comply
with the government’s policy on sustainability.
41
Fig. 3.2 Dimension of the Research Design
In principle, basing on the product as well as the effectiveness of the programs
implemented of ASUS in response to the sustainability policy of Taiwan would give
us the idea on how a certain company, ASUSTek in particular would comply to the
call of government. Whether the intention is more of the Strategic CSR rather than
Responsive CSR, we can clearly see how CSR would serve as a channel for
public-private partnership thus creating participatory governance among the
stakeholders.
42
Fig. 3.3 Dimension of Research Concept
This study aims to analyze the corporate response using CSR on the public
policy. This research then is all about corporate and political interaction and fostering
an inter-organizational cooperation. This study then will further observe and study the
behavior of business towards a public policy and also the behavior of interaction.
With these, Corporate Social Responsibility will be used as a methodology in the
study of behaviors of stakeholders and how these stakeholders interact with the
government. The concept of this research then not only analyzing the corporate
response but also creating a new concept of participatory governance though business
and government interaction via collective actions in addressing a collective agenda.
43
Fig. 3.4 Research Process Flow
This paper is basically employs qualitative method. The paper, with the data
gathered through interview, literature review and literature comparison and discussion,
the paper was able to analyze and describe on how ASUS responded to the
Sustainable Energy policy. The idea why ASUS performs a dynamic and competitive
CSR, in this paper, was due to two motivating factors. (See fig. 3.4)
Analyzing the two factors lead the ground for investigating why ASUS would
perform much in CSR, in sustainable development specifically. This would be the
basis for balancing the argument why a company complies. Is it because of these
factors or really the sincerity of the company in responding to the national agenda?
The two factors were balanced and were used in considering the conclusions for the
findings of this paper.
44
Motivating Factors
Corporate Factors:
Business Strategy
Company Branding
Governmental Factors:
Policy Compliance
Cooperation
Fig. 3.5 “The factors that affects the ASUS CSR”
The call for compliance
A normative theory of law includes the ethics of legislation and
adjudication. The latter is the focus of theoretical interest, as we saw. However,
it also includes the ethics of enforcement (from the police and executive point
of view) and compliance (from the citizen point of view). We will not say
much about the ethics of enforcement (not every law has to be enforced and
the costs and choices make it essentially a utilitarian issue). Our concern is
with the obligation to obey the law. The question is not about the legal
obligation because that is what adjudication determines. The question is about
whether there is a moral obligation to obey the law - here we mean the law as
correctly interpreted (using the inner moral principles of the law).
We might think that since we morally interpret law, we should naturally
have a moral obligation to obey it. However, it is not that simple. What we
have been justifying is the rule of law and the standards for interpretation. We
Corporate Social
Responsibility
� Sustainable
Development
� Environmental
Protection
45
have accepted that our definition is one that ought to justify fidelity to law and
thus amounts to a moral justification of the rule of law. Having fidelity to law
involves commitment to support the institution of the rule of law. Now given
that we ought to support and defend the institution, does that mean we each
have a moral obligation to obey each and every law? Do we have a moral
obligation to obey any law, per se?
46
Chapter IV
Data Analysis
4.1 ASUS Eco Products and it’s Labelling
Since 2000, ASUS has dedicated itself to environmental protection and has
initiated Green ASUS as its sustainability drive. They have included international
regulations and directives such as Restriction on Hazardous Substance (RoHS), Waste
Electrical and Electronic Equipment (WEEE), Energy Using Product (EuP)
regulations as well as standards of various international eco labels into our technical
standards. Therefore, the Research and Development (R&D) engineer could refer to
the technical standards at the product design stage so that the product could meet both
requirements of eco label and of the green public procurement.
Eco label and environmental declaration are worldwide environmental
management tools designed to pursue green consumption and to provide consumers
the opportunity to purchase environmentally friendly products, as well as leading
manufacturers to develop and produce environmental friendly products in response to
market demand. Different from eco label, in order to claim Environmental Product
Declaration (EPD) for a product, Life Cycle Inventory (LCI) is required to quantify
the environmental impacts of a product in each stage throughout the life cycle of the
product, and the data has to be verified by an independent third party and be published.
ASUS follows ISO 14025 to implement LCI for N51 notebook computer, and the
product receives the world’s first EPD certificate for notebook computer in September,
2009. Obtaining EPD certificate could help consumers to objectively compare the
environmental performance among products and purchase products with lower
environmental impacts, and it could also provide data throughout the product life
47
cycle to manufacturer for further improvement in environmental performance.
4.1 (A) Electronics Products Environmental
Assessment Tool (EPEAT)
The Electronics Products Environmental Assessment Tool (EPEAT) is an
easy-to-use environmental procurement tool for purchasers to identify
environmentally preferable desktops, notebooks and monitors. EPEAT is a
purchasing system featuring products that meet a stringent set of environmental
criteria. Products are ranked 'Gold', 'Silver' and 'Bronze' depending on how many
green criteria they meet. EPEAT verifies registered products to ensure they comply
with the Standard. EPEAT also offers a calculator for precisely measuring
environmental benefits. EPEAT evaluates electronic products according to three
tiers of environmental performance – Bronze, Silver and Gold. The complete set of
performance criteria includes 23 required criteria and 28 optional criteria in 8
categories. According to the numbers of criteria meet, the registered product will be
evaluated to the appropriate tier. EPEAT evaluates 8 environmental categories:
1. Reduction or Elimination of Sensitive Materials
2. Materials Selection
3. Design for End of Life
4. Product Longevity/Life Cycle Extension
5. Energy Conservation
6. End of Life Management
7. Corporate Performance
8. Packaging
48
EeePC Notebooks Monitors Integrated Computers
T101MT U30Jc
(Eee PC Super 10D) (Series:U30J, PRO33J) VW247N
All-in-One PC
ET2400INT
1011PX UL30JT
(Series: R011PX) (Series: UL30J, PRO32J,
PL30JT)
VE208D All-in-One PC
ET2400IT
1015PX
(Series: R051PX)
B43E VE208N All-in-One PC
ET1611PUT
B43S VW199SR EeeTop PC ET1610PT
(Series:ET10B)
B53E VB198T All-in-one PC ET2011E
B53S All-in-one PC
ET2011EG
K53E
(Series: X53E)
All-in-one PC
ET2011EGT
P53E All-in-one PC
ET2011ET
Table 4.1 ASUS Product with EPEAT Gold (Taiwan)
(Source: http://csr.asus.com/english/index.aspx#41)
4.1 (B) The EU Flower
Over the past ten years, the "Flower" has become a European-wide symbol
for products, providing simple and accurate guidance to consumers. All products
bearing the "Flower" have been checked by independent bodies for complying
with strict ecological and performance criteria.
While few human activities are completely 'environmentally friendly', there
49
are always opportunities to reduce the impact that certain products have upon the
environment. To establish a standard to reduce environmental impact, the EU
Flower program developed a set of environmental and performance criteria for
judging products based on all aspects of a product's life, from its production and
use to its eventual disposal. The key requirements to achieve the EU Flower
include:
1. Consumes less energy during use and standby
2. Contains less substances that are dangerous for health and the environment
3. A free take-back service is provided by the manufacturer after use
4. Designed for easily disassembly and recyclability
5. Increased product durability through upgrades
6. Batteries are efficient and less polluting
4.1 (C) The US Energy Star
Energy Star is a joint program of the U.S. Environmental Protection Agency
and the U.S. Department of Energy helping us all save money and protect the
environment through energy efficient products and practices. ASUS has launched
products complied with ENERGY STAR, and many products are more energy
efficient than the standard:
1. LCD in on mode in general performs 27.4% better than the standard, and
VW199 performs 52% better than the standard.
(according to Energy Star Requirement for display V5.0, test at 115V)
50
2. NB performs 27.8% better than the standard, and K52JE performs 58.5% better
than the standard.
(according to Energy Star Requirement for computer V5.0, test at 115V)
3. DT performs 23.8% better than the standard, and CS6110 performs 50.8%
better than the standard.
(according to Energy Star Requirement for computer V5.0, test at 115V)
4. Eee PC performs 38.2% better than the standard, Eee PC 1001PG performs
59.3% better than the standard.
(according to Energy Star Requirement for computer V5.0, test at 115V)
5. Eee BOX performs 61.8% better than the standard, Eee BOX EB1002 performs
73.6% better than the standard.
(according to Energy Star Requirement for computer V5.0, test at 115V)
6. Eee TOP performs 45.4% better than the standard, Eee TOP ET1610P performs
71.4% better than the standard.
(according to Energy Star Requirement for computer V5.0, test at 115V)
4.1 (D) Taiwan Green Mark
TheGreen Mark logo comprises a green sphere enwrapped in a green tree leaf.
The green leaf represents the green consumerism while the green sphere
symbolizes a clean and unpolluted Earth. The Green Mark shows that green
consumerism is a worldwide concept, which could achieve the environmental goal
of "product recycling, pollution reduction and energy saving" if it is universally
promoted and recognized.
51
4.1 (E) Taiwan Product Carbon Footprint
Label
Carbon Footprint Label is a marking that indicates the carbon emissions
during a business service or product life cycle assessment. To strengthen the
competitiveness of low carbon market, Taiwan's government announced "Taiwan
Carbon Label" icon in December 2009, published the relevant operating standards
for Taiwan Carbon Label and began to accept the application in 2010. After ASUS
N51V notebook was awarded the world's first Carbon Footprint Certificate for
notebook by DNV in 2009, N51V also is qualified for Taiwan Carbon Footprint
Label.
Other eco labels ASUS achieved for their products were Japan Eco-Mark,
which is in accordance with the standard and principle ISO 14020 (An
environmental label and declaration, a general principle) and ISO 14024 (An
environmental label and declaration, a type I environmental-label display, a
52
principle and procedure) and Korea Eco label, evaluates a product based on the
following key requirements:
1. Common Criteria
2. Environmental Criteria
3. Noise Emission
4. Power Consumption
5. Use of Chemical Substances
6. Recyclability of the Product
7. Lifespan Extension
8. Quality Criteria
9. Information for Consumers
4.2 Carbon Footprint (PAS 2050 & ISO 14067)
A"carbon footprint" is the total set of direct and indirect greenhouse gas
(GHG) emissions caused by an individual, event, organization or product. At
product level, each stage of the product life cycle, including materials,
manufacturing, using, transportation, and disposal, will emit greenhouse gas
emissions. We can get the "carbon footprint" of a product by calculating the total of
direct and indirect greenhouse gases throughout its product life cycle. ASUS
follows BSI PAS 2050:2008 and ISO 14067-1(CD):2010 to implement Life Cycle
Inventory (LCI) for N51V notebook computer, and the process and data are
verified by Det Norske Veritas (DNV). ASUS N51 notebook computer receives the
world's first carbon footprint certificate that is verified according to PAS
53
2050:2008 and ISO 14067-1(CD):2010 at the same time.
To reduce the carbon footprint of the product, ASUS further analyzes the
GHG inventory of N51V, and then adopt eco-design to introduce U53Jc notebooks
- a Bamboo notebook computer with the concept of green innovation. The top
cover and the keyboard layout of U53Jc use natural bamboo to replace plastic
materials, and the notebook are equipped with ASUS' exclusive energy saving
technology Super Hybrid Engine (SHE). ASUS attempt to reduce the carbon
footprint of products carbon footprint of the product by material replacement and
improvement in energy efficiency.
The effort of ASUS to improve their product basing on their sustainable
principle in compliance to CSR. ASUS continues to invest in research,
development and manufacturing of the finest consumer technology products in the
world. Reliability, quality, performance and environmental responsibility remain
front and center, with a forward-thinking philosophy that guarantees sustainable
growth and ever-improved tools.
4.3 The ASUS CSR Comparison
On the comparative section, a graph was presented showing the compliance to
both companies specifically to ISO certification 14001, ISO certification
9001/9002, and Eco-Labels. A thorough discussion of the companies’ respective
CSR policies and projects were also discussed and were given commentaries and
analysis. ISO 14001 relates to environmental issues. Although it is a system
standard, it requires organization to identify and assess environmental aspects and
54
take necessary control to reduce environmental impacts. Many organizations need
to put efforts to take all additional environmental tasks so that they employ ISO
14001 consultancy firms to solve the technical environmental issues. Training is the
first step of implement ISO 14001 and then organization needs to consider
ISO14001 consultancy. ISO 9001 on the other hand is an international standard that
gives requirements for an organization’s quality management system (QMS).
4.3 (A) ASUS versus ACER (Taiwan
Comparison)
Acer Incorporated’s principal activities are to develop market and sell
computer workstations, PC servers, business desktops, computer-related
components and software. The company claims to be the world’s number 4 ranking
vendor for PCs and notebooks after Dell, HP and Lenovo (Acer Inc, 2006). Its
other activities include repair services of Acer brand products, investing, financing,
construction, and provision of internet, electronics services and information
storage.(van Dijk, 2007)
Acer recognizes the importance of Corporate Social Responsibility by stating:
“As an ethical and responsible enterprise, Acer believes in building a
people-friendly environment that cultivates innovative thinking, and in creating a
sustainable company while providing positive contributions to society. We regard
the interests of our customers, employees and shareholders with foremost
importance. With company growth and profitability achieved, Acer holds to the
spirit of giving back to the society that sustains it and is committed to
implementing CSR for sustainable operations.”
(http://global.acer.com/about/sustainability.htm, June 29, 2011)
55
Acer’s interest in CSR is very recent and seems to focus predominantly on
environmental issues. Only in 2005, Acer published its first Corporate
Environmental Report. The report mainly focuses on the environmental
performance of Acer while human and labor rights are hardly addressed.( van Dijk,
2007)
6According to the company, Acer's global operation, spanning across Europe,
Middle East, Africa, the Americas, Greater China and the Asia Pacific, is devoted
to:
1. Ensuring that its products and operations meet all applicable environmental
regulatory requirements.
2. Selecting technologies that minimize harmful, non-environmentally sensitive
materials; conserve energy; and are recyclable.
3. Saving energies, preventing pollution, minimizing and recycling discards in its
daily operations.
4. Promoting awareness of its environmental policy among employees and
partners in our supply chain.
5. Building an Environmental Management System (EMS) to continually
monitor and improve activities.
56
ISO 14001
Certification
( company policy)
ISO 9001/9002
Certification
(company policy)
Eco-Labels
ASUS yes yes Energy Star, EU
Flower, Taiwan Green
Mark, EPEAT
ACER yes yes Energy Star, EPEAT
Table 4.2 The ASUS and ACER Green CSR Comparison
Acer is an ISO 9001 and 14001 certified company. Also all of Acer’s tier-one
suppliers have acquired ISO 14001 certification. Acer states that it adheres to the
EU Directive on the restriction of hazardous substances (RoHS) by prohibiting the
use of lead, cadmium, mercury, hexavalent chromium and brominated flame
retardants PBB and PBDE. On January 1, 2006, all Acer products will comply with
the RoHS Directive. On August, 2005, according to the company, all Acer
operations and products comply with the EU Directive on Waste Electrical &
Electronic Equipment (WEEE). Acer is a partner of the EPA Energy Star program,
through which companies and organisations aim to complete successful
whole-building energy efficiency upgrades.
Commentary:
Like ASUS, Acer is one of Taiwan’s biggest computer manufacturers. The
company is considered as ASUS’s strongest rival among the local computer
57
industries in comparison of quality, sales and products. Given the fact that both
these computer industries have many things in common, what makes it different is
its “company branding”. ASUS’ would create its own name that would create an
impression on its users and also non users. By creating a CSR, companies’ would
be able to reach the social level which is not exclusively users alone. Taking the
case of Acer’s effort in answering the call, by joining sustainability programs and
or by complying with sustainability policy, a company could make a trade marking
not only on their products but for their company’s image as well. Acer unlike
ASUS, is a member of Electronic Industry Code of Conduct, that serves as a
standard for company to create corporate ethics.
4.3 (B) ASUS versus Toshiba (International
Comparison/ Japan)
7Toshiba Corporation is a Japanese high-technology electrical and electronics
manufacturing firm, headquartered in Tokyo, Japan. It is the 7th largest integrated
manufacturer of electric and electronic equipment in the world.
8Toshiba presents clear information on its attitude towards Corporate Social
Responsibility (CRS) in its annual report and website: “Toshiba Group positions
Corporate Social Responsibility activities as main pillar for management. To earn
the trust of society, our business activities must be fair. Toshiba Group places the
highest priority on “human life and safety” and “legal compliance” throughout our
business activities.”
9In addition to social elements, Toshiba’s procurement policy also contains
guidelines on environmental demands on suppliers:
58
1. Suppliers are encouraged to adopt ISO 14001-based environmental
management systems and to promote third-party certification.
2. Suppliers are encouraged to utilize Green Procurement, which provides for the
procurement of parts and materials that have the smallest negative impact on
the environment. Suppliers are also encouraged to reduce or eliminate use of
potentially hazardous substances.
3. Suppliers are encouraged to promote environmental protection activities, such
as, the establishment of positive environmental policies, the improvement of
systems that affect the environment and to provide training opportunities in
the area.
Toshiba’s Green Procurement Details provide further information on the
company’s environmental policy towards suppliers. Green procurement mainly
implies that Toshiba prefer procurement from suppliers that are promoting
environmental activities (mainly (intention to) adoption of the ISO 14001
certification) and of intermediates that have minimal environmental impact
.
59
Table 4.3 ASUS and Toshiba Green CSR Comparison
ISO 14001
Certification
ISO 9001/9002
Certification
Eco-Labels
ASUS yes yes Energy Star, EU
Flower, Taiwan Green
Mark, EPEAT
TOSHIBA Not specified though
preferred certified
suppliers
Not specified though
preferred certified
suppliers
Not specified
Toshiba Group has developed Environmental Vision 2050, a corporate vision
that envisages affluent lifestyles in harmony with the Earth as an ideal situation of
mankind in 2050, and will work to realize this vision.
Throughout the life cycle of products from manufacture and use to reuse and
recycling, Toshiba Group will strive to provide safer and more comfortable lifestyles
and create enriched value for customers. The Group will also strive for harmony with
the Earth by working to mitigate climate change, using resources efficiently, and
managing chemicals, the three pillars of its environmental management system.
Commentary:
Toshiba is one of the leading Asian companies in the computer industry. Taking
ASUS as a subject to compare, we can see that Toshiba developed its CSR out of the
norms of the usually “standard” form that is adhering to the international standards
that CSR should follow. From this point of analysis, Toshiba deviated from the
60
common CSR tradition of following certain rules or achieving CSR recognition to
prove its CSR competency. What remains then is the idea on how sincere a CSR
program can be? Toshiba, created its own CSR vision using their own criteria without
basing into merit-base CSR or publicity CSR. It doesn’t mean that merit-base CSR or
publicity is bad but Toshiba, in comparison to ASUS, we can projéct a CSR out of
standard compliance as a corporate policy but rather a corporate policy that creates a
compliance to optional standards.
4.3 (C) ASUS versus DELL (International
Comparison / USA)
Dell Inc. is an American computer hardware company based in Round Rock,
Texas. During 2005 Dell was the number one supplier of personal computer systems
(PCs) worldwide as well as in the United States. Dell’s founder, Michael Dell,
pioneered the direct-to-consumer sales model for computers. Dell has completely
abandoned retail stores and sells all its custom-assembled PCs directly to consumers
by mail order, allowing for higher flexibility, lower inventories, lower costs, and
higher profit margins. A second feature of Dell is the Wintel platform (Microsoft
Windows operating system and Intel microprocessor), which characterizes its PCs.
Although Dell has exclusively used Intel chips in its computer systems in 2006 the
company announced plans to use chips from AMD in some of its high-end servers.
(van Dijk, 2007)
10Dell’s website contains clear statements on its CRS policy: “As a company
with an extensive global supply chain, we recognize that we have a responsibility to
work with our suppliers to promote sustainable environmental practices, the health
and safety of people and fundamental human rights and dignity.”
61
Dell's environmental policy consists of the following objectives:
1. Design products with the environment in mind: reducing energy consumption
and avoiding environmentally sensitive materials
2. Prevent waste and pollution: waste minimization, recycling ad pollution
prevention
3. Continually improve performance: implementation of environmental
management system
4. Demonstrate responsibility to stakeholders: communication and engagement of
stakeholders
5. Comply with the law: comply with environmental laws and meet commitments
with voluntary environmental programs.
ISO 14001
Certification
ISO 9001/9002
Certification
Eco-Labels
ASUS yes yes Energy Star, EU
Flower, Taiwan Green
Mark, EPEAT
DELL Yes (along with
suppliers)
Yes (along with
suppliers)
Energy Star, EPEAT,
Blue Angel, TCO
Table 4.4 ASUS and Dell Green CSR Comparison
Dell requires that its suppliers are compliant with ISO 14001 certification or
62
submit a schedule for achieving certification. According to information in the
sustainability report 98 percent of the target suppliers (i.e. top 80 percent spend with
focus in China) achieved or maintained the ISO 14001 certification in the fiscal year
2006. Dell has actively participated in the Environmental Protection Agency (EPA)
Energy Star program for more than a decade. It states that many of its desktops and
notebooks now exceed the current levels set by the EPA for energy efficiency. Finally,
Dell actively participates in a number of environmental standards. (van Dijk, 2007)
Commentary:
Comparing to ASUS, Dell can be perceived as a corporate achiever in terms of
sustainability. Like ASUS, Dell complied with standards and requirements by creating
programs and maintaining product sustainability. Dell is a good comparison between
local CSR compliance by ASUS and US CSR compliance by Dell. We can perceive
the CSR compliance in the US system. In the case of Taiwan where CSR is not a
trend when formulating corporate policy, Dell CSR can be a good model for
international companies in creating their corporate social responsibility policy.
4.3 (D) ASUS versus Apple (International
Comparison/ USA)
Apple Computer, Inc. is an American computer technology corporation
headquartered in Cupertino, California. It develops, sells, and supports a variety of
electronic products including personal computers, portable media players, computer
software, and computer hardware accessories. The company's most well known
products include the Macintosh line of personal computers, the Mac OS X operating
system, the iPod portable music player, and the iTunes Music Store. Apple
63
Computer's desktop and laptop computers include its Mac mini, iMac, and MacBook
for the consumer and education markets, and more powerful Power Mac and
MacBook Pro for high-end consumers and professionals involved in design and
publishing.
Apple does not publish a separate CSR report. It also does not provide a ‘glossy’
annual report for its shareholders. Instead one can download a copy of the Form 10-K,
the annual report required by the U.S. Securities and Exchange Commission. The
10-K includes information such as company history, organizational structure,
executive compensation, equity, subsidiaries, and audited financial statements, among
other information. However, in the case of Apple, it does not contain information on
CSR issues. In this respect two documents are relevant:
(1) Ethics, Apple’s company code of conduct, which deals, among others with
corporate governance, information disclosure, environmental health and safety, and
procurement;
(2) The Apple Supplier Code of Conduct, which in particular deals with working
conditions of suppliers. (van Dijk, 2007)
Apple has adopted the precautionary approach and claims that throughout the
complete production process, from design through manufacturing, use and recycling,
it ensures that its products and activities are environmentally sound. It focuses on four
areas: product design, manufacturing, energy efficiency and recycling. Since 2001 all
Apple computers and displays have earned the Energy Star Rating. Apple states that
their manufacturing sites are certified to the ISO 14001 standard. As noted on
www.apple.com/environment: ’Apple’s manufacturing site is certified to the ISO
14001 standard, which helps companies manage environmental impacts in an
integrated, systematic way’. It is however not clear which manufacturing sites have
obtained certification. Apple claims that all its products are RhoS compliant.
64
ISO 14001
Certification
ISO 9001/9002
Certification
Eco-Labels
ASUS yes yes Energy Star, EU
Flower, Taiwan Green
Mark, EPEAT
APPLE yes Not specified Energy Star, TCO
Table 4.5 ASUS and Apple Green CSR Comparison
According to Apple, for more than 20 years, Apple has been working on ways to
minimize the impact the company and their products have on the environment.
They’ve developed and formulated the company’s first environmental policy in 1990,
and every year since then, they’ve continued to make the company products more
energy efficient, eliminated many toxic substances, and embraced renewable energy
in their facilities. In 2009, they became the first company in the industry to report
comprehensive calculations of the company’s total carbon footprint including
environmental reports for every product giving the public an opportunity to judge
Apple’s efforts and track its progress in detail.
Commentary:
Apple is one of the top computer companies in the world given the fact of its
uniqueness in design, software and format. Like Dell and ASUS, Apple complied and
achieved much in the field of the so called Green CSR. The only difference is that
Apple CSR is not well published since Apple’s branding was overshadowed by “it’s
65
Apple” tag. In this case, we can assume that CSR of Apple is either a mere trend or
just to say that the company complies or got a CSR program in order to be in the
corporate tradition to have a CSR.
4.3 (E) ASUS Comparison as a whole
To consolidate all the ASUS comparison from 4 companies, we can see the table
below (see Table 4.6). Notice that the US Energy Star and the EU EPEAT were the
most present among the eco labels, while Swede TCO is both present to US computer
companies of DELL and Apple. Majority of the 5 compared industries had
incorporated ISO’s 140001 and 9001/9002 certification as a part of their corporate
policy and a requirement for their suppliers.
ISO 140001 ISO 9001/9002 Energy Star EPEAT Other label
ASUS Ya Ya � � �
ACER Ya Ya � � =
TOSHIBA Yb Yb = = =
DELL Ya Ya � � �
APPLE Ya X � = �
Ya= ISO certification incorporated in the corporate policy and suppliers
Yb= ISO certification required to suppliers
X= not incorporated nor unspecified
Table 4.6 Matrix of Comparison
The voluntary compliance of the companies to ISO 14001, contributes to the
effort of lessening the threat to environment amidst the challenge of development. The
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involvement of procedures and supply chain to create a criterion for quality and
sustainability through ISO 9001/9002, though voluntary assures the participation of
the corporate sector as a stakeholder in this social agenda. Sustainable development
has been widely considered as an important issue in the high-tech industry.
Sustainable development was initially referring to environmental concerns, and
now also compassing social, ethical and economically issues. Sustainability is a
composite of social, economical and environmental issues (Carroll, 1981, 1999; DJSI,
2006). Sustainable development has been defined as “development that meets the
needs of the present without compromising the ability of the future generations to
meet their own needs”. (Law, 2010)
According to Law, 2010, a growing number of organizations or firms have begun
to adopt corporate responsibility strategies to contribute to sustainable development
goals. These strategies are aimed at aligning the self-interest of the firms with the
greater public good in ways that add value to both the firms and the society. Asian
organizations are far lagging behind those in the West in having supportive policies
and sustainable development strategies (Welford, 2005). Some Asian countries have
moved towards sustainable development (Mental et al., 2007). Asia has been
developing itself in many areas, within the context of sustainable society, new
institutions and collaborations are formed to drive changes.
Although some companies don’t incorporate environmental standards in their
corporate policy, some of them require their contractors to adhere thus forming the so
called “Green Logistics” and “Green Outsourcing”. In the case of Toshiba for
instance where they require their suppliers to adhere in some of the environmental
standards such as ISO 14000 and others. For Apple computers for example, Taiwan’s
Chimei Innolux (CMI) expecting to open a transaction with Apple for their LCD’s.
CMI, incorporate both ISO 14000 and ISO 9001 in their corporate policy.
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4.4 Green ASUS and its Impact
The publishing of Corporate Social and Environmental reports aims at
demonstrating ASUS' commitment towards stakeholder communication and data
transparency. In 2005, ASUS published the first Environmental, Health and Safety
Report. In 2007, ASUS was honored to present the first Environmental Sustainability
Report. In 2008, they release their first English Corporate Sustainability Report that
follows the Sustainability Reporting Guidelines v3.0 (G3) defined by Global
Reporting Initiative (GRI). The reports aim to shows details on ASUS's global
activities, which contribute to sustainable developments. In 2009, ASUS release the
Corporate Sustainability Report which follows the Global Reporting Initiative (GRI)
G3 guidelines and receives the GRI-checked Application Level B icon. Furthermore,
in 2010, ASUS achieves the highest Application Level A and also receives the
GRI-checked Application Level A icon. ASUS will continuously improve and
disclose more achievements in corporate social responsibility efforts in the future.
ASUS has a full-time environmental health and safety team that is responsible
for company-wide environmental security management. The team assesses the
environmental impact arose from company's activities to make sure the company meet
environmental regulations and government-related environmental requirements and
continues to promote the improvement plan, thereby lowering the environmental
impact to the minimum, moving towards "zero-pollution" goal.
Each site is equipped with an independent sewage treatment plant. The disposal
and handling procedures of sewage are in accordance with relevant provisions, thus in
complied with environmental regulations. The main source of wastewater is from
office use. The wastewater will not pollute the surrounding surface water for it is
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processed through the sewage treatment system and the effluent meets the discharge
standards. Designated members are responsible for the set up and maintenance of the
sewage treatment plant to ensure that all equipments and processes are in the best
condition. ASUS also assign an external environmental agency to perform the quality
check of the effluent water periodically and hold a committee meeting to review and
monitor the wastewater management. The government also conducts random audits to
avoid the environmental impact brought by effluents.
ASUSTek commits to reduce 15% of the GHG emissions associated with energy
use by 2015 (based on 2008 level). As one of the world's leading computer brands,
ASUS is willing to devote itself to climate change issue and promote energy saving
and carbon reduction based on “no regret policy”. Since 2004, ASUS has required the
manufacture sites to implement energy saving project, and in 2005 we saved about
11% of electricity used in manufacture sites in Taiwan. After ASUS had announced
spin off OEM and Brand in January 2008 and became a Brand company.
The GHG inventory followed ISO 14064, and the scope was defined in Taiwan
only. Scope 1 included diesel oil of emergency generators, gasoline of transportation
buses, energy consumption by the facilities in headquarter, air conditions and
refrigerants in headquarters; Scope 2 included electricity of office buildings/sites and
dormitory; Scope 3 included natural gasses from cafeteria, canteen, gasses and
refrigerants. The total and the types of energy consumed in 2008 were 18,810 MWh
of electricity, 228 liters of diesel oil, and 9,201 liters of gasoline. The calculation of
CO2-e emissions are based on the emission factor and CO2 electricity coefficient
provided by Bureau of Energy, Ministry of Economic Affairs of Taiwan, and the
global warming potential (GWP) defined in IPCC 2006 Guidelines. The total CO2-e
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emissions were 12,374.1 metric tonnes of CO2-e, with Scope 2 whose type of source
is electricity makes up the majority of the GHG emissions.
Year 2008 is the company’s first time doing the GHG inventory for Scope 3
GHG emissions, starting with the cafeteria and canteen. The company is planning to
further expand the Scope 3 inventory to business traveling by combining the
Employee business traveling system with the internal GHG Database IT platform for
GHG emissions. In addition, ASUS will also discuss with the company’s major
suppliers and outsourcers to corporate and process the GHG inventory.
Aside from GHG Reduction, several programs of ASUS were introduced to meet
the demands and address issues the current environmental challenges poses. Such as
product recycle and end of life management, Green Products and others. For product
recycling and disposal for instance, old computers, notebook computers, and other
electronic equipment contain hazardous chemicals that can be harmful to the
environment when disposed in a landfill with trash. By recycling, the metals, plastics,
and components found in an old computer will be broken down and reused to make
new products. And, the environment is protected from any uncontrolled release of
harmful chemicals. ASUS works with recycling vendors with the highest standards
for protecting the environment, ensuring worker safety, and complying with global
environmental laws. Their commitment to recycling old equipment grows out of our
work to protect the environment in many ways. In Taiwan, according to the Recycling
Fund Management Board of Environmental Protection Administration Executive
Yuan and ASUS' project "PC Recycling for A Brighter Future", the PC recycling rate
was 41.2% and the recycling weight is around 4000 tons in 2007; 46.1% and around
3000 tons in 2008. ASUS has established recycling service in Taiwan, Europe and
North America. Global recycling rate reached 8%, and recycling weight was around
3750 tons. Computers that can be recycled and re used were usually donated to
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individuals or institutions that don’t have computers thus creating a CSR chain from
environment to social service.
The strong commitment of the company for energy sustainability and
environmental preservation and to reduce carbon use and GHG emission through
creating energy efficient yet sustainable products and reducing energy consumption of
ASUS’s FABs contributes a lot to what the Sustainable Energy Policy aims. The eco
computers of ASUS help in improving energy efficiency and sustainability in every
usage. The lesser energy consumption will be, the lesser the use of carbon, thus
reducing carbon emission and GHG emission. The lesser the energy consumption will
be, the energy supply will be stable.
Despite of the efforts, what was the impact of these that would make a societal
significance?
A report released by Ethical Corporation, examines how organizations can
incorporate the measurement of social and economic reporting into their CSR
activities. Its premise is that companies are beginning to realise that corporate
responsibility is about much more than being green, despite a hazy understanding of
exactly how social and economic impact studies benefit their business.
It attempts to analyze different impact models - giving case studies and examples
from different companies. These include managing supply chains, assessing
integration into the local community and contributing to social and economic
development. Its learning includes demonstrations of CSR achievements from other
sectors. For example, it shows how international aid agencies have come to measure
developments after years of struggle. It showcases examples which are relevant for
the private sector. On the case of ASUS, its Green ASUS contributed in this social
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endeavor of promoting sustainable energy and efficiency through improving from
within, starting from their own products and corporate policies. The impact of
business on communities is becoming an increasingly important element of CSR
activity.
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Chapter V
Limitations and Conclusion
This paper used limited resources in order to investigate how a company behaves
on a policy. The difficulty of investigating due to limited literatures left some
theoretical gap in this paper. The information was based on the ASUS CSR report
since 2008 publication to present with other resource data since the company started
its formal CSR documentation on the year 2005. This paper despite of its limitations
can serve as:
1. Pilot studies for further studies on corporate behavior towards public policy.
2. A related literature on CSR analysis in general and CSR management.
3. A reference for companies on formulating their CSR policies.
The case of ASUS is both achieving yet remains ambiguous. Achieving in the
sense that ASUS achieved a lot and exerted efforts just to improve their CSR. The
question then is why ASUS exerted much on these? What is the real motivation of the
company? As stated on Chapter 3 assumptions that it’s either governmental factors
that is, it’s either stakeholder’s participatory governance or mere compliance or
corporate factors that is, it’s either a value creation CSR or just a business strategy for
corporate branding.
As Wu, et.al (2006) stated that like high-tech, companies need to develop
sustainable products to meet the market needs. The sustainable product development
involves both cost and market factors that reflect the common themes of enhanced
73
profitability, improved product marketability and consumers’ perception on the firms’
corporate social performance. Management and scholars have been searching for the
determinants of motivating factors of sustainable development. To date, though, we
still do not really understand why some firms are more motivated and performing
better than other firms in sustainability and business performance. However, there is a
clear lack of comparative approaches, and very little empirical research has dealt with
the influencing factors. None of the researches account for the high-tech
manufacturing industry in the region.
Shall we view CSR as publicity building? Publicity like this can be a key part of
using CSR to win contracts. People want to buy from businesses they respect. CSR
can be particularly effective for targeting ethical companies, the public sector and
not-for-profit organizations.
At the same time, you should see CSR as part of a continuing process of building
long-term value. Everything you do should help improve your reputation and
encourage customers and other stakeholders to stay involved with you. A business
that buys recycled paper - but exploits its customers and ignores the community - has
missed the point.
You could consider working towards a management standard which you can then
use to publicize your ethical, environmental or social responsibility. For example,
many businesses have already achieved the environmental management standard ISO
14001.Building a reputation as a responsible business sets you apart. Companies often
favor suppliers who demonstrate responsible policies, as this can have a positive
impact on how they are perceived by customers. As for ASUS reducing resource use,
waste and emissions doesn't just help the environment - it saves you money too. It's
74
not difficult to cut utility bills and waste disposal costs and you can bring immediate
cash benefits.
Whatever the reason of ASUS, it should be seen on the brighter side wherein we
should focus on its effects in regards to this societal agenda rather than scrutinizing
the motives of ASUS that drove the company to implement CSR. As a
recommendation, companies should develop more programs that will cater to the
needs of the society not to what will suit to the government’s policy. Since
stakeholders are called for participatory governance, all sectors should work for the
betterment of the state. Let CSR be a means for the corporate sector not only to
response to policy but rather as a corporate principle.
Conclusion
Since Taiwan is not one of the countries listed in Annex 1 of Kyoto Protocol,
Taiwan has no immediate risk of emissions restriction from Kyoto Protocol. However,
Taiwan government is proactively promoting energy saving policy and drafting
Greenhouse Gas reduction law. The use and development of renewable energy has
become a major policy incentive in Taiwan. Some measures, promoting renewable
energy, were previously instituted, but many legal and institutional barriers,
hampering the development of renewable energy, remain; thus, it is necessary to
encourage discussion to eliminate barriers and implement support mechanisms.
The challenge of rapidly increasing global greenhouse gases (GHGs), and their
pervasive impact on humanity, has spurred international initiatives for limitations on
GHG production. Among others, the Taiwanese government is paying close attention
75
to this issue. According to the Challenge 2008: National Development Plan and the
Nuclear-free Homeland Policy, the government of Taiwan has offered favorable price
incentives to renewable energy producers, for up to 12% of the country’s total power
generating capacity (about 6500 MW). Furthermore, according to the Nuclear-free
Homeland Action Plan, a budget of NT$3 billion (US$90 millions) will be made
available each year, commencing 2004, to promote the development of clean energy
and energy saving industries. This shows that the use and development of renewable
energy has become a major policy incentive for the Taiwanese government. (Wu, et.
al, 2006)
Fig. 5.1 Development Progress of Renewable Energy of President’s Committee of Advisors on Science and Technology
(Source: Wu, et al ,2006)
ASUS is in support of and is happy to see the legislation of GHG reduction law,
thus the company became the member of the Business Council for Sustainable
Development (BCSD) and also joined the GHG Reduction Law working group of
Taiwan Corporate Sustainability Forum (TCSF) of BCSD in 2008 to show ASUS’
commitment of GHG reduction law.
Since 2007, ASUS has answered Carbon Disclosure Project (CDP) questionnaire
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to disclose the GHG inventory data and environmental protection strategies. CDP is a
non-government organization which works with shareholders and corporations to
disclose the greenhouse gas emissions of major corporations and possesses abundant
information regarding climate change collected from all over the world. ASUS
voluntarily answers CDP questionnaire and exchange GHG information through such
platform to share our experience in the area of energy saving. ASUS will continuously
improve itself and contribute more to the topic of global climate change issue.
Despite these achievements, there are points to consider. On the part of the
government, is the Sustainable Energy Policy, a strong commitment of Taiwan
government not only in securing Taiwan’s energy but also its commitment for a
sustainable development for the future or just a lip service of the government just to
show that they’re committed and participant to the international agenda despite
Taiwan’s current international status? ASUS, truly drove the global business
environment but how sincere the company is and not just a green washing propaganda,
as a way of Strategic CSR approach? In principle, basing on the product as well as the
effectiveness of the programs implemented of ASUS in response to the sustainability
policy of Taiwan would give us the idea on how a certain company, ASUSTek in
particular would comply to the call of government. Whether the intention is more of
the Strategic CSR rather than Responsive CSR, we can clearly see how CSR would
serve as a channel for public-private partnership thus creating participatory
governance among the stakeholders.
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