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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:

Getting your employees on the social media bandwagonND

Kirsten Watson, Business Week, 10 November 2010

For companies who wish to increase or build their social media initiatives, the most common source used are internal staff. Surveys have shown that employee buy-in is vital to ensure success of the initiatives. Holding brainstorming sessions can foster ideas for content and employee participation. Management should be aware of ‘champions’ that actively encourage and promote social media usage. These employees and others should feel valued for their contributions and employee visibility online will motivate engagement with social media. For more information see

Rare earth conflicts to continueND

Jianjun Tu, Asia Times Online, 10 November 2010

The term ‘rare earths’ refers to several strategically important commodities that are used to manufacture defence and commercially high value-added applications. Currently, China, the worlds’ leading rare earths producer, has been tightening export restrictions particularly on rare earth oxide, with China’s stockpile representing 97 per cent of the world’s total supply of rare earth oxide. If China is able to meet its planned export restrictions, it will further its competitive advantage over other suppliers; with the ultimate aim of exhausting all external stockpiles of rare earth oxide. In the long term, China’s monopoly over rare earths will not only result in increased prices, but also provides a valued political bargaining chip for the country. For more information see

PepsiCo and GE are innovating IndiaND

Navi Radjou and Jaideep Prabhu, Bloomberg Businessweek, 9 November 2010

Although multinationals traditionally use emerging markets to source new products and services, some companies like PepsiCo and General Electric are using emerging markets to try out disruptive business models. PepsiCo, for example, is developing partnerships in India with universities and other companies to develop eco-friendly technology as well as a range of health products, thus expanding its market. Similarly, General Electric developed partner networks in India to introduce its technology-based solutions to healthcare, which it provides to Indian hospitals at a sustainable and affordable rate. Emerging markets are described as ‘learning labs’, allowing companies to develop and deliver innovative products. For more information see

After decades of war, Sri Lanka bounces backND

Frederik Balfour, Bloomberg Businessweek, 4 November 2010

Sri Lanka is poised for economic growth following the end of the civil war, with the Asian Development Bank expecting the nation’s economy to grow as much as 8 per cent this year and next. The Sri Lankan government expects tourism, IT outsourcing and agricultural exports to be the three sectors that will fuel economic growth, reducing reliance on the garment industry and low-end manufacturing. While Sri Lanka is experiencing renewed foreign investment, these investments are happening slowly, with many raising concerns about corruption and the nation’s human rights track record. For more information see

Corporate India finds greener pastures — in Africa ND

Mehul Srivastava and Subramaniam Sharma, Bloomsberg Businessweek, 4 November 2010

In the midst of increasing competition, growth and a shortage of access to land, Indian companies are directing their sight towards Africa for investment and growth. For many Indian companies, Africa represents India as it was 15 years ago, allowing low-cost, high-efficiency business models as well as providing companies with a new consumer market. As such, companies are spending huge amounts in Africa, with the continent attracting large Indian companies such as Airtel, as well as other Indian companies who are making various smaller acquisitions. For more information see

Sector still faces threat of regulationND

Vesna Poljak, Australian Financial Review, 4 November 2010

An increase in banking profits for the recent financial year has reduced investor pressure, yet not regulation pressure on the sector. The new government regulation could force Australian banks to adopt new credit and liquidity standards. The regulation will depend on new international standards adopted by the Basel committee. It is undeniable that the regulatory changes will sweep through all aspects of the business. The banks’ future growth and competitive advantage will depend on how they respond to the new regulations. For more information see

Be wary of web smear publicity, firms toldND

Lian Mo, China Daily, 3 November 2010

An emerging trend of online smear campaigns is strengthening in China, with negative online publicity posing a serious threat to business, and affecting even major corporations. The smear campaigns can result in heavy financial losses for its victims and is widespread, with an e-PR company estimating that 10-20 per cent of their clients have receive malicious content each year. The prominence of online smear campaigns has lead to an emerging business, in which public relations companies are hired to polish the online image of their employer, as well as deleting any unfavourable comments. For more information see

Malaysian Budget 2011: some green trends to get you startedND

Jayanthi Naidu Desan, CSR Asia, 3 November 2010

The 2011 Malaysian Budget is underpinned by a green development strategy that the government believes is key in driving competitiveness. The budget provides for a number of green incentives, including tax breaks and soft loans, and aims to inspire CEOs by framing green development as a ‘win- win’. Four trends are identified to assist a company in becoming green: investing in green innovation, providing related information on products such as energy usage and the carbon footprint, the need to provide green products without an associated premium, and the usefulness of adopting green living in everyday life. For more information see

China fuels: The plug-in planND

The Economist, 2 November 2010

With the release of its latest Five-Year Plan, the focus of China’s government is clearly on developing a low-carbon economy. China arguably already leads the world when it comes to several areas of green energy, such as wind power and solar water heaters. It looks as if the electric vehicle market could be next. In 2009, China overtook the US to become the largest global market for wind power, housing nearly one-third of the world’s total installed capacity. China has targeted the sale of 1 million ‘clean energy’ cars by 2015. While ‘clean energy’ encompasses a wide range of technologies, Chinese authorities are focussing on electric vehicles. The government has been promoting these technologies through subsidies and trial recharging points (but only to domestically produced vehicle models). For more information see

Five secrets of charismatic leadershipND

Nick Tasler, Bloomberg Businessweek, 2 November 2010

Recent research has demonstrated that a more reserved, introverted style of leadership may be more beneficial for employees than an extroverted style, as introverted leaders are more likely to engage in team approaches to solving issues. Charismatic leadership is still however useful in engaging employees, especially when the employees are more reserved. Five means of increasing charisma are outlined, these being; ensure the subject matter of your speech is interesting, describe positive outcomes, recognise that the path to achieving these outcomes may be difficult, outline the actions necessary to achieve outcomes and use positive emotional language. For more information see

NZ wine first in world to come with carbon footprint labelND

Rebecca Smithers, The Guardian, 2 November 2010

Wine consumers will soon be able to assess the environmental impact of a New Zealand wine brand. The labels will display carbon emissions for the making and transporting of products tailored to individual export markets. The particular brand has been pursuing sustainable management within the New Zealand wine industry for a long time. Price continues to be the dominant factor, whereas ethics and environment are lower priorities. By choosing products that carry the labels, consumers are supporting companies that are working towards a more sustainable future. For more information see

China’s economic tightropeND

Jonathan Fenby, BBC News, 1 November 2010

China’s original economic model based on ‘cheap labour, cheap capital and a benign export market’ is no longer sufficient to ensure continued economic growth and a strong international presence. The Five Year Plan starting in 2011 hence proposes new economic strategies, including increasing energy efficiency, ensuring an equal distribution of wealth, boosting domestic consumption and developing more environmentally friendly equipment. The Plan also proposes social reforms; including developing an effective health service and improving education and pension provisions. While these proposals reflect a shift in economic policy, they are unlikely to result in a fundamental economic structural change; which may potentially be damaging to China’s economic future. For more information see

Consumers at the wheel of IT strategy developmentND

Michael Bayer, Financial Times, 1 November 2010

Consumer-driven demands, the emergence of new cultural attitudes to work and advances in mobility-enabling technologies have allowed consumers to directly influence IT strategy development. Technology companies are increasingly recognising the dynamics that connect business and the consumer, and are harnessing this dynamic as a business opportunity by framing their products as ‘business productivity tools’, for example the iPad. Companies that recognise this dynamic and take advantage of the connection between business and the consumer will experience positive benefits. For more information see

Green marketers are still sinningND

Andrew Winston, Harvard Business Review, 29 October 2010

The green marketing research firm Terrachoice recently conducted a study of products claiming to be green, and counted how many of them had committed any of seven ‘sins’ as defined by Terrachoice. The sins include making vague claims such as being ‘all natural’ without providing any proof as well as stating irrelevant details. Amongst the findings, Terrachoice discovered that although there are a rising number of green products, the vast majority of them are committing at least one ‘sin’. The study also found that categories of products that have a longer history of green certification tend to commit less ‘sins’ than products in categories that have only recently been subject to green certification standards. For more information see

Bet on India, not ChinaND

Raghav Bahl, Forbes, 27 October 2010

China is today investing nearly half its GDP, something that is unprecedented in modern history. It is important to understand that China has strong investment in infrastructure; these life-enhancing assets actually empower people. India is also a country that is investing heavily, yet it has a very attractive mix of services and manufacturing. India saves a great deal of its GDP and is mostly built from private enterprises (with state-owned corporations accounting for less than a tenth of output). Finally, India is in a sweet demographic spot with half a billion Indians being less than twenty-five years old. For more information see

Shaky foundations to China’s growthND

Dalibor Rohac, Asia Times Online, 21 October 2010

Although much research has been done concerning the macroeconomic aspect of China’s economic development, little attention has been paid to the microeconomic aspect. A survey conducted by the Legatum Institute has uncovered some underlying problems in the microeconomic aspect of China’s rapid economic growth; namely the fact that China’s entrepreneurs function in and are hence largely dependent on state-run mechanisms to support their economic success, as opposed to personal or familial support relied upon by entrepreneurs in India. This state reliance could be a source of fragility for entrepreneurs, who may encounter difficulties in the wake of a major crisis where the government’s capacity to provide support is lessened. For more information see

Macau job rules don’t workND

Muhammed Cohen, Asia Times Online, 19 October 2010

The Macau government has recently introduced tighter regulations for hiring non-residents, signifying a crackdown on foreign workers and forcing employers to give precedence to local employees. The regulations have however faced strong opposition, with employers arguing that they now have difficulty finding qualified employees, as well as delaying existing construction projects and thus slowing potential economic growth. The regulations are criticised for not adequately addressing the underlying problems in Macau, which require better qualification of the local workforce and increased inflows of labour. For more information see

India: the future of management education?ND

Tim Westerbeck, Bloomberg Businessweek, 17 September 2010

India has recently witnessed a huge growth in demand for management training, which has consequently led to growth and innovation in its business school sector. Currently, India is in a position to become a global leader in management education, learning from the mistakes of the West to create an innovative business education sector. There are six ideas that India needs to follow to reinvent management education and become a global leader; these being the need to introduce cross-disciplinary education programs, to design their business schools as global institutions, to create strong ties with businesses, to utilise technology-based learning, to ignore the established ranking criteria and to use innovation to deliver all forms of management training. For more information see

Moving women to the topND

McKinsey Quarterly, 15 October 2010

As more women move into leadership roles, their potential impact on business increases. While the majority of executives acknowledge the link between better financial performance and gender equality, few companies take actions to support women. Diversity is not a high priority within the majority of strategy decisions and the financial crisis has not changed this view. Among the common actions taken to support women are implemented support programs for reconciling work and family life, as well as programs to encourage female networking and role models. A more diverse range of activities are undertaken by larger firms and commonly senior executives are encouraged or mandated to mentor junior executives. For more information see

Carbon footprint labelsND

Martin Hickman, The Independent, 13 October 2010

In the UK it is estimated that by the end of 2010, a carbon footprint ethical label will become the second most commonly used standard for leading food brands. It shows that producers are working to reduce carbon emissions that cause global warming by the use of their products. In some cases the labels display the CO2 generated by each product and providing an insight into the level of pollution for each product. Consumers are increasingly becoming aware of carbon footprints for products and are trying to do something about it. For more information see

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