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Jem Bendell
Adjunct Associate Professor,
Griffith Business School, Australia

Founder, Lifeworth, Switzerland

Jonathan Cohen |
Principal, Stakeholder Consulting;
Author, Business Watch*

Tipping Frames: The Lifeworth Review of 2006
[ PDF: 2585kb | 54 pages ]

Appendices available in all PDF versions.

Taming the messenger


Media's critical role in defining corporate responsibility as one that extends beyond the borders of a Western company's headquarters has long been enshrined since the exposition of sweatshop operations among Asian manufacturers contracted by major brands. Besides garments and sport shoes, the same concept has seeped through other industries, such as diamonds, mining and forest products, among others.

While sweatshop stories have become a dime a dozen, in August the big news was the story of Asia's largest electronics contract manufacturer, Taiwan-based Hong Hai Precision Industry Co., which sued mainland Chinese journalists for allegedly 'damaging its reputation'.45 It came with a different twist: the suit took the heat off the manufacturer and its clients, which include global brands Apple, Hewlett-Packard, Dell, Sony and Nokia. Apple's famous iPod was touted as another sweatshop icon.46

Bringing journalists to court is a civic right of corporations, but it is also considered as part of corporate manoeuvrings to divert attention or to harass messengers of bad news. In this case, the 'messengers' involved a writer and editor of Shanghai-based newspaper, China Business News, which published in June a story about substandard working conditions and low pay in the factory of Foxconn, a subsidiary of Hong Hai in mainland China. To be sure, Apple sent auditors to the factory and found that, other than occasional breaching of Apple's acceptable Code of Conduct limit of 60 hours and one day off per week, especially during peak production periods, the sweatshop claims were unfounded. Hong Hai went on to slap the journalists-not the publication, as is usually the case-with a RMB30 million (approximately 2 million) libel suit that led to the freezing of the journalists' assets. The strategy backfired as progressive Chinese media made this a case of 'press freedom' versus the big bad corporation. Eventually, Hong Hai withdrew the lawsuit.47

Elsewhere in Asia, media organisations continue to bear the brunt when there are stories about corporate and political wrongdoings. And, since political economy continues to rule the landscape where the media organisations operate, cases of harassment abound. For example, the Philippines in South-East Asia has been touted as the 'second most dangerous country to be a journalist', next only to Iraq.48 About 47 local journalists have been killed since 2001,49 most of them based in provinces where thin-skinned political and business leaders still believe retribution against unfriendly press remains under the national radar. After reporting on the military's role in an election fraud, editors of Newsbreak magazine, an independent local publication, were sent a funeral wreath and shadowed on their way home, while their office phones were bugged.50 Advertisers also withdrew their support for fear of political retribution to their local business operations.51

The foreign press, supposedly unaffected by economic and political limitations of their local counterparts, is expected to provide the big and unadulterated picture. But the experience of Far Eastern Economic Review (FEER), an affiliate of Dow Jones focusing on current events in South-East Asia and China, has been instructive. In its July/August issue, it published an interview with Chee Soon Juan, an opposition leader and vocal government critic.52 Slighted, top-government officials reinstated a media code that requires foreign media companies to set up local office in Singapore, which could be sued whenever it publishes articles unfavourable to local leaders. For not kowtowing, FEER was banned in Singapore starting September.

The real context of the ban, according to sources of Reuters and Agence France-Press, is the timing of the FEER story.53 In September, Singapore was set to host the annual meeting of the International Monetary Fund (IMF) and World Bank (WB). Singapore's officials did not want anyone 'making embarrassing noises' as the 16,000 delegates from all over the world flocked to Singapore.54 Interestingly, the World Bank has been a staunch believer of an independent media as a factor in economic development.55

While Singapore's Ministry of Information stated confidently that Singapore 'will remain a good investment location ... [since it] offers a stable, pro-business environment, and a safe, secure and vibrant place for foreigners to live, work and play', Mark Mobius, fund manager of Templeton's US$20 billion fund invested in emerging economies, affirmed that investors 'valued a free press in countries where they put their money'.56

If these watchdogs in Asia were limited in their ability to hold their government and, in the same breath, the corporations that operate in these countries, accountable for their actions, how can Asians appreciate the bigger goal of corporate citizenship?

This was raised by journalists who attended Newsbreak's seminar on 'Covering Corporate Social Responsibility' held last September in Subic Bay, the Philippines. According to Lala Rimando, business editor of Newsbreak, 'It was a good opportunity to share how media should report on and criticize the companies' design and implementation of their social responsibility programs. But are the companies actually ready to walk their talk and address accountability issues on how they run their core businesses?' Exhibit one: When a tanker carrying bunker fuel owned by Petron Corporation, an oil company owned by the Philippine and Saudi Arabia governments, sank near a marine sanctuary in central Philippines, Petron initially shunned accountability for the economic costs of the oil spill although it readily provided a litany of its good works in various poor communities.57 Judging by the September conference of Asian Forum, the biggest gathering of corporate social responsibility advocates in Asia, most Asian companies are still at the level of community philanthropy projects.58

These dynamics-press freedom and the practice of corporate responsibility-are crucial not only in how Asians draft their future, but also in how the West asserts its influence in Asia. After all, China, the region's biggest and most influential economy, has been growing its trading and political stake in the region in recent years. 59 So, while Western countries assert their influence in China, they might as well also consider those to whom China turns as alternative economic partners.

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45 'Journalists sued over iPod story', China Economic Net, 29 August 2006; en.ce.cn/Business/Enterprise/200608/29/t20060829_8338445.shtml.

46 'iPod City: Inside Apple's iPod factories', Appleinsider, 12 June 2006; www.appleinsider.com/ article.php?id=1799.

47 'Taiwan firm drops China iPod libel case', Reuters, 3 September 2006; www.boston.com/business/technology/articles/2006/09/03/taiwan_firm_drops_china_ipod_libel_case.

48 'Amnesty International alarmed over Philippine killings', South China Morning Post, 26 July 2006; www.asiamedia.ucla.edu/article.asp?parentid=49849.

49 Press Release, International Federation of Journalists, 11 December 2006.

50 Raissa Robles, 'Arroyo under new media challenge', South China Morning Post, 18 November 2006; www.asiamedia.ucla.edu/article.asp?parentid=57997.

51 Discussions with Newsbreak editors.

52 www.feer.com/articles1/2006/sing_banning/free/index.html

53 Sara Webb, 'Singapore's media controls jar with regional aims', Reuters, 30 August 2006; www.singapore-window.org/sw06/060830R1.HTM; and 'Singapore tightens rules on some foreign media', Yahoo! News, 4 August 2006; sg.news.yahoo.com/060804/1/42kk9.html.

54 Quote from Roby Alampay, executive director of the Bangkok-based watchdog Southeast Asian Press Alliance; sg.news.yahoo.com/060804/1/42kk9.html.

55 World Bank, Free and Independent Media Empower the Poor and Spur Development (Washington, DC: World Bank, 2002).

56 Webb, op. cit.

57 'Petron slips', Newsbreak, 25 September 2006; www.newsbreak.com.ph/newsbreak/story.asp?ID= 699.

58 CSR Asia Weekly Vol. 2 Week 39; www.csr-asia.com/upload/csrasiaweeklyvol2week39.pdf.

59 59 'Beijing keen to unlock ASEAN investment doors', Asia Times Online, 2 November 2006; www.atimes.com/atimes/China_Business/HK02Cb01.html.

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