Knowledge Centre:
News Digests

Stay abreast of what’s happening internationally with developments in corporate public affairs. Here is news that you may find useful and interesting:

Does race or gender matter more to your paycheck? ND

Deborah Ashton, Harvard Business Review, 28 May 2014

Income disparity between genders is extensively reported and commonly acknowledged. American women earned 82 cents to every dollar made by a white male, up from 79 cents and 77 cents respectively, in 2012. What is less universally understood is whether race or gender is a greater determinant of income dissimilarity. This study offers an interesting insight into income disparities and the correlation between gender, race and educational attainment. For more information see

The terrible math of employee engagementND

Nigel Miller, Edelman, 1 May 2014

Organisations struggle to actively engage their employees. Deloitte’s recent Human Capital Trends study indicated that 80 percent of companies fail to satisfactorily engage their workforce. This inability can have a detrimental effect on every aspect of an organisation. Only 13 percent of employees globally are actively engaged at work and double that number are so disengaged that they are likely to spread their discontent to others. This article delves into this pervasive issue. For more information see:

Why a Quarter of Americans Don’t Trust Their Employers ND

Gretchen Gavett, Harvard Business Review, 28 April 2014

This article provides an interesting insight into the psychological state of the American workforce. It analyses general satisfaction in the workplace, feeling valued at work, trust and lack of, stress, and the profound interrelation between them. Dr. David Ballard, the head of American Psychological Association’s Centre for Organisational Excellence, helps unravel the intricacies associated with employee satisfaction and accentuates the importance of attaining effectual employee engagement. For more information see

Japanese messaging App Line gains traction abroad ND

Eric Pfanner, Wall Street Journal, 21 April 2014

The success of Japanese mobile phone application Line continues to impress. Line is achieving striking growth outside of Japan, making inroads into markets such as Spain, where users are attracted to minimising the costs associated with staying connected. Line has begun to penetrate the Latin American market, demonstrating success in Brazil and in Mexico. Recently, a foray into the US market has been made, initially targeting its Spanish speaking population. Line boasts 175 million users globally. For more information see:

Weibo’s US debut underwhelms ND

Charles Clover, Financial Times, 18 April 2014

China's Twitter-like micro blogging platform Sina Weibo went public on the Nasdaq stock exchange on Thursday. The stock did initially raise less than expected however rallied in late trading, closing at $21.24. Weibo did enter a turbulent technological market; however this is not believed to be the sole challenge to its launch. An increase in government censorship has seen Weibo's user rate decline. Tens of thousands of Weibo user accounts have been deleted, with dozens of high-profile users jailed for "rumourmongering". For more information see:

How to get employees to be more entrepreneurial ND

Deborah Ancona, CNN Money, 15 April 2014

Organisations today are faced with an increasingly competitive and changeable environment to compete. Increasingly, a more collaborative approach is adopted by organisations, subsequently altering the traditional organisational structure. To facilitate this transition, leaders should foster an inclusive environment, where those in less esteemed positions feel comfortable and welcome to offer opinions and input. For more information see:

Japan and Australia ‘beef up’ relationsND

Aurelia George Mulgan, East Asia Forum, 15 April 2014

The recent trade deal between Japan and Australia (JAEPA) has been lauded as a significant gain for Australian beef exporters and its agricultural industry. The lack of an agricultural restructuring element from JAEPA highlights Japan’s successful protection of some of its most revered commodities. The trade deal also facilitates Shinzo Abe’s security strategy, reflecting his desire to strengthen security initiatives with Japan’s key partners. For more information see:

How to avoid a social media fiasco ND

Gerald C. Kane, MIT Sloan Management Review, 8 April 2014

The importance of generating a governed approach to the use of social media should not be underestimated. Companies have and will continue to experience mixed results when engaging with social media. Having a prepared response to a social media crisis can avert the issue spiralling out of control, as the cost of not being prepared can be difficult to contain. For more information see:

All you need to know about business in China; the one hour China book ND

Jeffrey Towson & Jonathan Woetzel, Mckinsey & Company, April 2014

Conducting business in China is often approached with a degree of uncertainty. Misconceptions and presumptions can be warranted, however are often overemphasised. The enormity of China’s manufacturing industry, the rapid growth of its middle class, its shadow banking industry and the immense increase in China’s brainpower continue to impress. For more information see:

How government can promote open data and help unleash over $3 trillion in economic value ND

Michael Chui, Diana Farrell, Kate Jackson, Mckinsey & Company, April 2014

The immense amount of data becoming available in recent years is only a share of what is out there. There continues to be a substantial amount of data trapped in paper records, which if released, can add immense economic value to the global economy. The role government can play in unlocking this wealth is underestimated. For more information see:

Corporate philanthropy: The transformative power of givingND

Leo D'Angelo Fisher, BRW, 1 August 2013

Philanthropy has emerged as a major source of funding for cash-strapped universities at a time when successive federal governments have dramatically reduced funding. Philanthropy has become an important component of universities’ funding models. The director of development at the University of Sydney, Tim Dolan, says interest in giving to universities will keep growing as long as universities make sure of two things: that projects match the interests and passions of potential donors, and that universities deliver on their promises. “The driver of the big gift has everything to do with trusting that the university is going to deliver on its promise,” Dolan says. “The unique advantage universities have is that they drive change. Donors don’t talk to us because they want to make up shortfalls in government funding, they want to be involved in something that’s transformational and that’s what universities are good at." For more information see

The benefits of sustainability-driven innovationND

Kiron, Kruschwiz, Reevs and Goh, Sloan Management Review, Winter 2013

According to the 2012 global executive survey on sustainability, an important factor in linking corporate sustainability with profits is business model innovation. Managers who say that their company’s sustainability activities have added to the company’s profits are more than twice as likely to say that sustainability has caused their organisation to change their business model than not. Certain combinations of sustainability-related business model changes appear to have a bigger link to profitability than others. Respondents whose companies changed both target segments and the value chain, for instance, are more likely to say their sustainability activities add to profit than respondents whose companies changed other combinations of business model elements. Sustainability-Driven Innovators often do more than just change their business model. They are also more likely than other survey respondents to have a business case for sustainability, to work closely with key stakeholder groups on sustainability issues and to have the attention of top management focused on their sustainability efforts. For more information, see

A balancing act in corporate citizenshipND

Luke Johnson, Financial Times, 23 July 2013

In this opinion piece, the author queries whether consumers really support companies that are responsible or whether corporate citizenship is ‘just politically correct hot air’. He compares Marks and Spencer which has undertaken significant efforts to be a good corporate citizen and low-cost retailers that have had booming sales despite using suppliers based in Bangladesh and involved in the recent factory collapse. He suggests that suppliers care more about prices rather than where products are sourced, but then concludes by saying ‘business can be both self-serving and ethical’. Companies rarely survive in the long run if they offer bad quality products and service and treat employees, suppliers and other stakeholders badly. For more information, see

Raising the bar on nonprofit impact performanceND

Tris Lumley, Stanford Social Innovation Review, 10 July

Ten years ago, critics dismissed impact measurement as too difficult, misleading, or simply not important. Today, 75 percent of charities measure some or all of their work, and nearly three-quarters have invested more in measuring results over the last five years. The author reduces the system of measuring nonprofit results to three sets of actors: funders providing resources, nonprofits delivering services, and beneficiaries receiving products. The author cites research carried out in the UK that shows that funder requirements are the primary driver behind an increase in impact measurement among nonprofits. Improved strategy and services are the main benefits that they see as a result; by understanding the impact of their services, they are able to improve what they do. The paradox is that nonprofits measure their results to satisfy funders, but the main reward is a better service, not increased funding. The author suggests that in order to ensure that impact measurement results in improved services and increases impact, then we have to make sure it works for the nonprofit. Only then should we turn to what funders want out of impact measurement. For more information see

Choosing the right eco-label for your productND

Magalia Delmas, Nichols Nairn-Birch and Michaela Balzarova, MIT Sloan Management Review, Summer 2013

With more than 435 ‘eco-labels’ available globally (according to the Ecolabel Index directory), there is much confusion about which are the most appropriate to use. This article provides a framework across three dimensions: consumer understanding and awareness, consumer confidence, and willingness to pay. Eco-labels should be simple, have resources allocated to the communication about the label, and the organisations behind them should be transparent. It is advantageous to use those that are multi-product, have endorsements from governments and large retailers, and the support of multiple partners. Willingness to pay is increased when these labels emphasise better quality, health benefits and leverage peer pressure. The authors caution that companies need to check the credibility of partners and avoid any conflicts of interest. For more information, see

Designing trustworthy organisationsND

Robert Hurley, Nicole Gillespie, Donald Ferrin and Graham Dietz, MIT Sloan Management Review, Summer 2013

Results from the Edelman Trust Barometer show that trust in business continues to be low, despite government reforms, corporate spending on ethics compliance and increased training. While business trust violations are often blamed on individuals, the authors argue that it is more often a result of failures in the corporate system, including a culture that serves the interests of one stakeholder group at the expense of others. Also, there are often inconsistencies in embedding trust within organisations. This article provides a model of organisational trust and a guide to embedding trust within the organisation. For more information, see

The executive’s role in social businessND

David Kiron, Douglas Palmer, Anh Nguyen Phillips and Robert Berkman, MIT Sloan Management Review, Summer 2013

A study of over 2,500 business executives from 99 countries shows that more companies are realising the value of social business, which relies on effective senior leadership of social business capabilities. Social business is defined as the use of social media and networks, technology-based internal social networks, social software for corporate use, and use of data derived from social media and technologies. The role of a chief digital officer has emerged in many companies which “coincides with the convergence of a number of digital trends involving social business, the consumerisation of technology, mobile, the cloud, analytics and cybersecurity”. For more information, see

The trouble with stock compensationND

Yuval Deutsch and Mike Valente, MIT Sloan Management Review, Summer 2013

The authors undertook research on the relationship between director stock compensation and social performance ratings for 1,100 US public companies and found that while providing outside directors with stock (and alignment of director goals to shareholders) is an important part of compensation schemes, it effectively an incentive to ignore other stakeholders (other than shareholders). The article suggests a few approaches for addressing this, including diversifying the board to include stakeholders who represent non-shareholder constituents; extend board roles to include social and ecological obligations (and tying compensation to this); positioning the company as a CSR leader so than any divergence from this has implications for competitive advantage. For more information, see

Mapping China's middle classND

Barton, Chen, and Jin, McKinsey Quarterly, June 2013

The explosive growth of China’s emerging middle class has brought sweeping economic change and social transformation. The evolution of the middle class means that sophisticated and seasoned shoppers — those able and willing to pay a premium for quality and to consider discretionary goods and not just basic necessities—will soon emerge as the dominant force. McKinsey research has shown that this generation of Chinese consumers is the most Westernised to date. Prone to regard expensive products as intrinsically better than less expensive ones, they are happy to try new things, such as personal digital gadgetry. They are also more likely than previous generations to check the Internet for other people’s usage experiences or comments. These consumers seek emotional satisfaction through better taste or higher status, are loyal to the brands they trust, and prefer niche over mass brands. There will be not only challenges but also plenty of opportunities for companies whose strategies reflect China’s new constellation of rising incomes, shifting urban landscapes, and generational change. For more information see

The power of giving back: how community involvement can boost your bottom lineND

Entrepreneur, 26 June 2013

A recent study in the US confirms that consumers consider a company’s social responsibility efforts when making purchasing decisions. Companies should look to build relationships within the community, get employees involved, establish a volunteer program that draws on the strengths of the business and employees, and let customers know what they are doing. For more information, see

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