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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:

Every worker is a knowledge workerND

Evan Rosen, Bloomberg Businessweek, 11 January 2011

Nowadays, the terms ‘knowledge worker’ and ‘manual worker’ aren’t mutually exclusive, with companies beginning to recognise that employees that have been hired to perform manual tasks can contribute valuable ideas. Instead of a command-and-control style organisation in which idea generation is limited to a select few, companies should embrace collaborative organisational culture, in which information flows between all levels of the organisation. There are five ways in which employers can desegregate their workforce and facilitate a more collaborative culture; give all employees access to the same information, break down barriers among levels, enable spontaneous collaboration, involve everyone in decisions and recognise and reward broad input. For more information see

Feeding China in 2030ND

Benjamin A Shobert, Asia Times, 7 January 2011

Ensuring that there is an adequate supply of food to China’s population is one of the Government’s top priorities, and will be a key determinant of the Communist Party’s ability to remain in power going forward. Of the thirteen major famines in Chinese history, six have been closely related to political upheaval and conflict. Current challenges related to this issue are: living standards in rural areas, security of land tenure and creating sustainable agriculture. Furthermore, China is not well endowed in terms of available agricultural land relative to its population, and suffers from severe water shortages. Policy options include market model land reforms where farmers send land to conglomerates, or forcing farmers to give up land to the state. However, with 750 million Chinese livelihoods dependant on agriculture, and the already existing social services gap in rural areas, unhappy villagers are among the governments greatest concerns. For more information see

Cash call for green powerND

Mitch Moxley, Asia Times, 6 January 2011

More government investment is needed as researchers in China work towards making renewable energy cheaper and more efficient in China. While Japan and South Korea have jointly invested $1.6 billion on research on third-generation solar technology since 2000, China has invested around $22 million over the last decade. Despite becoming the global leader in renewable energy technology manufacturing, most of the parts produced by Chinese companies are based on technology developed abroad. The lack of regulatory direction limits innovation, particularly in the biomass industry, for which there are no definite regulations or policies. Critics say that China’s interest in renewable energy is essentially a business opportunity, as most of what is produced is sold abroad, and that it is less interested in investing in domestic innovation. For more information see

A challenge to public perceptionsND

Andy Wales, Ethical Corporation, 5 January 2011

Despite the common public perception of big business as ‘villains’, large companies have increasingly incorporated responsible business practices into business strategy over the past decade. There are several emerging realities that are both responsible for this change, and will continue to drive this strategic shift into the future. First, companies are increasingly becoming aware of the fact that they faced shared risks and responsibilities, and thus must move beyond a philosophy of enlightened self interest and confront issues such as global resource scarcity. Second, a new trend has emerged of developing systematic partnerships to resolve difficult social challenges, for example collaborating on human rights issues. Third, companies recognise the importance of being trusted, and the impact that this has both on internal and external perceptions. Fourth, leading businesses increasingly recognise that public policy intervention may in fact be needed on issues such as sustainability, and that they must engage constructively with this process. Finally, companies recognise that to be successful going into the future, they must view sustainability as an opportunity for innovation, not a risk to be mitigated. For more information see

Three big risks to China’s economy in 2011ND

Shaun Rein, Forbes, 5 January 2011

Most Chinese remain supportive of the government and the direction it is taking the country. Despite rising income disparities and pollution, the quality of life for the vast majority of Chinese is far better now than at any other point in their lifetimes. However, China has some big problems to address in 2011 if they want to maintain high levels of public support and preserve their nation's place as the world's second superpower. First, rising inflation is a serious problem. Second, there simply is not enough low-cost, clean and comfortable housing for ordinary citizens. Finally, trade tensions between China and the US continue to rise, which does not help the job situation for anyone. For more information see

Asia: the rise of the middle classND

David Pilling, Kathrin Hille and Amy Kazmin, Financial Times, 4 January 2011

Until recently, many economists were sceptical about the idea that China, or any other emerging Asia economy, could develop a sizeable middle class. However, this scepticism is beginning to fade. With growth in Europe and possible America likely to be slow for years to come, many businesses may look to Asia to attract new consumers. In China, many people have reached a ‘threshold level’ of income, at which consumption takes off. McKinsey expects that middle class will expand from 29 per cent of China’s urban households to 75 per cent in 2025. Similar growth is also anticipated in India, where it is expected that the number of households deemed middles class will nearly triple over the next five years. For more information see

The rise of the networked enterprise: Web 2.0 finds its paydayND

Jacques Bughin and Michael Chui, McKinsey Quarterly, December 2010

A new class of company is emerging — one that uses collaborative Web 2.0 technologies intensively to connect the internal efforts of employees and to extend the organisation’s reach to customers, partners, and suppliers. Results from a survey show that the Web 2.0 use of these companies is significantly improving their reported performance. Among companies that report using Web 2.0, a large majority continue to report that they are receiving measurable business benefits, including effective marketing to faster access to knowledge. Executives need to push their organisations toward becoming fully networked enterprises. Methods to achieve this include: Integrate the use of Web 2.0 into employees’ day-to-day work activities, Break down the barriers to organisational change and Apply Web 2.0 technologies to interactions with customers, business partners, and employees. For more information see

Co-creating planet-friendly profitsND

G. Michael Maddock and Raphael Louis Vitón, BusinessWeek, 21 December 2010

Co-creation is the practice of finding a synergistic partner and creating a new product together. It can occur both between profit-driven companies and nonprofit, and between profit-driven companies and cause-driven companies. The practice is becoming increasingly popular as companies recognise that consumers want to support companies that offer products, services and business models, which are good for the planet. The fourth annual Global Consumer Study from Edelman notes that a significant majority of consumers believe that a business needs to place as much weight on society’s interests as its own and that brands and consumers could do more to support good causes by working together. For more information see

Online sustainability reporting: moving from reporting to dialogueND

Mara Chiorean, CSR Asia, 15 December 2010

This article looks at recent trends and developments in the use of online media for sustainability disclosure and examines some examples of effective new media usage for this purpose. Using online sustainability reporting can brings benefits such as: resource efficiency, regular updates, engagement with a large audience, ability to track readership and improve stakeholder dialogue. This articles also outlines several case studies involving companies implementing Web 2.0 technologies to improve user interactivity and contribution. More and more companies realise that opening their communication channel is far less risky than they might have feared. Full online sustainability reporting and active stakeholder dialogue will be expected from a sustainability leader. For more information see

New accent on customer tastesND

Louise Lucas, Financial Times, 13 December 2010

In the past, products originated and were developed in the North and sold to the South. Nowadays, however there is a strong flow of ideas between the North and the South. Companies such as Unilever are recognising this, and are hence shifting more research and development resources to the emerging markets. This will have a number of consequences, including the development of existing products to suit the local market; new approaches to marketing and advertising as well as resulting in a quicker roll out of products internationally. For more information see

The Steve Jobs theory of customer relationsND

Joshua Gans, Harvard Business Review, 13 December 2010

Generally, CEOs don’t tend to engage with ordinary customers, instead leaving this interaction to their marketing or public relations department. Apple’s CEO, Steve Jobs, is however taking a different approach to customer relations, interacting with and responding to customers’ individual questions. Although Jobs’ answers tend to be quite brief, they are clear and to the point. Jobs’ approach to customer relations is just another business strategy that differentiates Apple from other brands, therefore strengthening the entire corporation. For more information see

Taking a green lesson from BhutanND

Xiong Lei, China Daily, 11 December 2010

Leaders need to broaden their outlook to consider models of sustainable development from less advanced countries. While current understandings of development centre on GDP growth, it is important for leaders to diversify this understanding and broaden conceptions of modernisation and civilisation. Bhutan provides a strong model of alternative development conceptions, measuring development in terms of Gross National Happiness (GNH). This includes measures such as psychological well-being, health, education and environmental diversity. While Bhutanese people still want prosperity, they are unwilling to sacrifice their ‘cherished traditions and culture’, preferring to pursue their own model of development rather than getting lost in the popular understanding of ‘modernisation’. For more information see

Chinese lead Asia-Pacific in online overseas purchases ND

Wang Zhuoqiong, China Daily, 8 December 2010

A survey conducted by Visa has demonstrated that Chinese consumers form the largest group in Asia-Pacific of online shoppers buying from overseas websites in the past year. Most shoppers are female, and the preferred websites are US and UK based, with customers preferring to buy products that they can’t get locally. The most commonly bought items online are clothing and shoes, however education and travel services contribute also to spending on international websites. As well as gaining access to a greater range of products, consumers also choose online shopping because of the convenience of this method over the conventional method. For more information

The business of charityND

Emma Connors, The Financial Review, 8 December 2010

Charities are becoming increasingly engaged with businesses. While increased funding is an incentive, charities also experience benefits in terms of gaining contacts, learning about business strategies and learning exactly what businesses want from their philanthropic activities. The relationship between business and charities is also developing in terms of the workforce, with more and more people moving from the for-profit to the not-for-profit sector, thus bringing valuable business experience to charitable organisations. Charities need however to maintain the balance between the corporate and charitable aspects, ensuring they uphold their values. While the relationship between business and charities can be a potential cause of conflict within organisations, ultimately, the relationship can benefit society as a whole. For more information see

Marketing to rural ChinaND

Max Magni, Harvard Business Review, 7 December 2010

While foreign and local marketers have begun expanding into smaller cities in China, few have moved in rural areas as they feel it would not be a wise business choice. Primarily, concerns about moving into rural China arise from the fact that there are few modern stores, as well as the fact that many of the roads in rural areas remain unpaved thus creating difficult transport situations. There are however ways of overcoming these difficulties to allow marketers to profit from rural China, such as setting up franchises to increase the number of stores, taking advantage of subsidies for rural consumers, and using existing sales and after-sales networks. Marketers looking to rural China should take care to tailor their products and prices to the rural market. For more information see

Four myths about business ethicsND

Chris MacDonald, CSR-NEWS, 6 December 2010

Four major myths about business ethics have been identified and debunked. The first is that the term ‘business ethics’ is an oxymoron. This is incorrect, as commerce is quite literally impossible without ethics. Every single commercial transaction requires some level of trust, which requires a shared commitment to ethical behaviour. The second myth addressed is the idea that ethics is ‘just a matter of opinion’. In fact, on many ethical issues there are actually better and worse answers which need to be talked through. The third myth is that there’s no such thing as ‘business’ ethics, as ethics should be consistent everywhere. In fact, business has unique characteristics, such as the fact that large companies have the potential to do significant harm to stakeholders and the environment. The final myth addressed is the perception that business ethics is just a matter of regulation. The reality is that there are behaviours that are legal but unethical, and also those that are illegal but ethically okay. For more information see

As wages rise, time to leave China?ND

Joe Manget and Pierre Mercier, Bloomberg Businessweek, 1 December 2010

The advantage for companies in basing their manufacturing operations in China is disappearing with the advent of rising wages, currency inflation and high fuel costs. Although searching for nations with cheaper wages provides a solution, this would only be short term as wages are rising around the world. Staying in China provides companies with the opportunity to rethink their approach to global production to stimulate greater productivity gains, as well as giving them the advantage of tapping in to the growing domestic consumer market. Additionally, companies have the option of moving their manufacturing capabilities closer to their consumers, for example American companies developing factories in Mexico. For more information see

China’s culture of secrecy brands research as spyingND

James T. Areddy, The Wall Street Journal, 1 December 2010

Foreigners conducting business in China are increasingly falling foul of laws that classify espionage as what most of the world would consider market research. The culture of secrecy in China, emerging primarily because of the strong relationship between government and business, makes foreigners cautious about engaging in business ventures in China, as well as being at odds with China’s desire to modernise its business sector through the involvement of foreign business. For more information see

Beyond paid media: Marketing’s new vocabularyND

David Edelman and Brian Salsberg, McKinsey Quarterly, November 2010

Traditional paid media used to be the only option business had when it came to marketing, yet today there are many more alternative forms of media that business can exploit. These expanding media forms reflect the way consumers perceive and absorb marketing messages. Marketers should view the expanding media options not only as a challenge but also as a way for readers to share content and even create their own content. Media can be ‘earned’ where the quality or uniqueness of a company’s product or content compels consumers to promote the company at no cost to itself. The diverse range of options has also increased the chance of being ‘hijacked’ and people quickly voicing concern over company operations. This provides a scary and significant reversal of the control traditionally maintained by marketers, therefore many are responding by encouraging satisfied customers to post online and replying to negative comments in a prompt and professional manner. For more information see

Emissions control efforts bring business opportunitiesND

China Daily, 25 November 2010

The Chinese government is demonstrating strong support for China’s new energy market, accelerating the construction of solar, hydropower, nuclear and wind capacities by investing in new materials and technologies. Chinese businesses are recognising the government’s commitment to developing clean energy, and are thus seizing the opportunity to invest in new energies, as well as beginning to adopt cleaner practices in their own operations. For more information see

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