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:

Two faces of a crisisND

Catherine Fox, AFRBoss, 10 July 2010

Whether a crisis is environmental or financial it can be dealt with in the same manner; there are two distinct phases that require different strategies of engagement. The emergency phase, the initial crisis stage, requires organisations to buy their time and stabilise the situation. The adaptive stage, the latter stage of a crisis, the leaders of the organisation need to tackle the underlying cause of the crisis and build capacity for new conditions. One of the main challenges remains to understand the psychology of expectations placed on companies in times of crisis. Many times key stakeholders are operating in an unrealistic timeframe. Immediate reactions to crisis, without enough consideration or with too much reassurance, can create a false sense of relief. For more information see

The higher costs of bribery in China ND

Dexter Roberts, Bloomberg Businessweek, 8 July 2010

Companies violating anti-bribery laws in China may be subject to prosecution under both increasingly stringent Chinese and US laws, following the Foreign Corrupt Practises Act (FCPA) which allows US prosecutors to investigate bribery anywhere in the world. Although bribery or gift giving was traditionally accepted as a custom in China, the risks are becoming higher, forcing companies to strategise on how best to ensure compliance with Chinese and US anti-corruption laws. For more information see

Cloudy innovation should brighten your budgetND

Michael Schrage, Harvard Business Review, 2 July 2010

The rise of super technology such as Twitter, Facebook and Youtube has created a ‘cloud of web services’, offering value to business organisations as playgrounds for testing innovative ideas. The cloud provides an opportunity for market testing before investing in new products or services, while its accessibility means that companies do not experience any tangible loss from usage. Although the cloud is not seen as a replacement for existing processing platforms, it provides both a medium for innovative play and business productivity. For more information see

Corporate sustainability: Are we really cruising in fifth gear?ND

Rory Sullivan, The Guardian, 1 July 2010

Recent surveys have demonstrated that the large majority of CEOs view sustainability issues as being of importance, and have taken steps to integrate sustainable practices into their companies’ strategy and operations. However a new MIT survey has suggested that while many business leaders are recognising the importance of sustainable practices, their actions aren’t living up to their words. Although some businesses have taken the lead in engaging in sound, sustainable business practices, many are lagging behind. For more information see

Lonely workers and suicide: what can responsible companies do? ND

Wei Zheng and Mabel Seah,CSR Asia, 30 June 2010

The recent suicides within Chinese companies have been linked to a rise in loneliness within working environments. Chinese people traditionally are not equipped to deal with these employment conditions and rapid changes in China. Corporations and social enterprises are pivotal for creating and sustaining campaigns that enhance social conditions. Preventive measures extend beyond national programs and companies can become involved at an individual level with workers. Seeing employees as living people with a wide range of different issues is a stepping stone towards building positive social conditions. For more information see

Corporate rework neededND

Ryan Witcombe, Probono News, 29 June 2010

New societal challenges in the next decade will force businesses to rework their corporate structures. This renovation of business practices will become essential since societal problems are likely to become more complex and new strategies will be required. Businesses need to position themselves now to maximise their profitability as well as their social impact. The main issues that will have the greatest effect on how companies engage with society, include shifting economic activity away from the west, talent mismatches, global connectivity, resource constraints, and a bigger role for governments. For more information see

The perils of a tarnished brandND

Ravi Mattu and Morgen Witzel,Financial Times, 24 June 2010

Brand and reputation are linked when thinking of organisations, what affects reputations in turn affects brands. Poor public relations and crisis management strategies highlight how hard it is to manage reputations. Many businesses forget to adapt their strategies as they grow, therefore they are at risk of negatively affecting their reputation. In other cases, companies lose the core values that define their brand. The most essential element of any successful brand is that company values are real and not just communication material. Customers not only communicate with companies but also with each other and the stories they share also shape a brand image. For more information see

Top 5 social media marketing mistakesND

Mike Proulx, Bloomberg Businessweek, 18 June 2010

Businesses have begun to recognise the value of social media as a marketing tool, however are making common mistakes. The top five social media marketing mistakes are infrequent monitoring of social media sites, leaving young and less experienced employees in charge of social media sites, not responding fast enough to online criticism, having employees pretend to be customers, and limiting social media campaigns to a specific time period. Although companies are making mistakes, they are learning from this process and are beginning to harness the potential of social media marketing. For more information see

Company bosses reset their compassesND

Steve Tappin and Andrew Cave, UK Telegraph, 13 June 2010

In a post-financial crisis business environment, top company executives are adopting entrepreneurial mindsets and espousing international mindsets. New radical measures require new styles of management and thinking procedures. Western businesses must focus on a long-term mindset especially since they are competing with entrepreneurial eastern companies. Employee management will also become important, since it is value-creating people who will grow a business. Fluid and flexible corporate structures are going to be necessary for corporations to thrive in the new economy. Among these changes are rapid response mechanisms, which require senior managers to revisit strategy more often than previously. For more information see

BP’s slippery slope: The dangerous disconnect between rhetoric and reality in times of crisis ND

Knowledge @ Australian School of Business, 11 June 2010

The crisis engulfing BP is widening the gap between its stated commitment to environmental responsibility and its slow reaction to the disaster. Companies should realise that when there is a substantial gap between the image an organisation constructs and how it actually behaves there will be a backlash. Top management may be seemingly indifferent to the damage done to the company brand. When corporate branding and behaviour are aligned during a crisis, trust and goodwill can elicit forgiveness from stakeholders. Executives should react quickly and balance their language to cater all stakeholders. Additionally, they should acknowledge their moral responsibility before legal responsibility. For more information see

School in for banks — push on to catch kids ND

Bruce McDougall, The Daily Telegraph, 11 June 2010

Australian banks are leading a charge into schools and access to school students through a variety of financial literacy programs, community projects which engage students and free courses on a wide range of topics. Schools though are cautious when dealing with big business on these types of programs. They realise that it is a selling point for business, yet generally corporate investment is welcomed as long as there is no commitment to honour company agendas. For more information see www.the

Signs of widespread worker action in ChinaND

Justine Lau and Patti Waldmeir, Financial Times, 10 June 2010

Labour protests in China are becoming more widespread and coordinated than previously imagined. Workers are using mobile phones and instant messaging services to communicate, comparing wages and working conditions throughout the country to bargain with their employers. Although the protests originated in smaller companies, and were quickly resolved, they are now spreading to multinationals such as Foxconn and Honda, raising concerns for rising costs. Workers tend to strike before public holidays, recognising that this gives them better bargaining power. For more information see

A good name is pricelessND

Sarah Murray, Financial Times, 7 June 2010

Although the financial crisis and the BP oil spill have shaken public confidence in the ability of businesses to act responsibly, companies continue to recognise the value of building a strong corporate reputation. Trends from the BITC awards reveal that companies are investing particularly in increasing their carbon efficiency, securing employee wellbeing, and working towards the MDGs, with such actions bringing significant financial benefits such as differentiation from competitors and increased customer loyalty. The value of a socially and ecologically aware reputation is however questioned in the context of large scale disasters, with reference made to BP and the Gulf oil spill. For more information see

Leadership in an age of austerity ND

Stephen Howard, Financial Times, 7 June 2010

Business are coming under increased scrutiny both from the public and from their employees in recent times, with the public experiencing a lack of trust in businesses and employees fearing job cuts and a lowering of wages. Strong and visible leadership in this period will be crucial to survival, with a majority of business leaders recognising this. The importance of being environmentally and social aware is also being recognised by business leaders, with the role of CSR changing from being that of an add-on to becoming a high priority for businesses. Recent research has demonstrated the continued financial benefits of companies engaging in CSR activities. For more information see

BP buys 'oil' search terms to redirect users to official company websiteND

Emily Friedman, ABC News, 5 June 2010

BP has purchased several key search phrases on major search engines. These important links connect the user to web pages containing information presented by BP and their communication team. Some claims are that this is not the best strategy for BP to control which information is accessible to the public. Yet generally this is seen as a great move since it is a proactive approach for the company to manage its brand image. It also allows BP to present its information above general news publications. Keyword purchases are quite small in comparison to clean up costs yet they are very important tools in the new media communication environment. For more information see

Charitable benefits are a good motivatorND

Jennifer Paterson, Employee Benefits, 1 June 2010

Charitable causes can be used to support organisation-wide strategies as well as serving their traditional roles of attracting and retaining staff, in addition to improving motivation and commitment within the organisation. An increasingly attractive option is payroll giving, yet these systems are only effective if they are constantly catered towards employee needs and interests. Employees like ‘giving’ in many different ways other than the traditional money approaches. A survey of employees revealed that 97% felt it was important for the employer to support volunteering on company time. For more information see

Spillonomics: Underestimating risksND

David Leonhardt, The New York Times, 31 May 2010

BP executives underestimated the likelihood of explosion at the Deepwater Horizon rig, and as such underestimated both the financial costs and the costs to their company’s reputation. Government legislation passed in the wake of the Exxon Valdez spill, which capped a spiller’s liability at $75 million for a rig spill, may have contributed to BP underestimating the costs of a potential spill. Possible consequences of this spill could be more stringent legislation, including the lifting of the liability cap, and the reluctance of lenders to lend credit to Washington. The environmental impact of greenhouse gas emissions from the rig, even when functional, is also noted. For more information see

What can businesses learn from Thailand’s turmoil? ND

Leena Wokeck and Alyson Slater,CSR Asia, 26 May 2010

The recent crisis in Thailand has long-term implications for businesses. The damage has been done to international confidence in Thailand, a key driver for investment, trade and tourism. Thailand’s situation demonstrates how inequality and social destabilisation can bring about substantial business risk and losses. Businesses must find ways to play a role in sustainable poverty alleviation and contribute to greater socio-economic equality and stability. While risk assessments are regular tools used by companies, it is interesting to note that not many companies include social cohesion as a consideration. For more information see

Companies fail to engage consumers on environmental and social issuesND

CSR Wire, 19 May 2010

Companies are not effectively engaging consumers on environmental practices and products. While consumers are willing to dedicate time and money to help businesses, companies are not meeting this commitment reciprocally. This signals a serious lost opportunity on behalf of companies. A large percentage of customers also want to be updated about improvements in products and services. An open and collaborative line of communication by companies can have significant advantages. For more information see

Integration of corporate responsibility in Australia and New ZealandND

ProBono News, 19 May 2010

A new research paper from the Centre for Social Impact at the University of NSW shows that corporate responsibility is, on the whole, well integrated into the way that leading companies in Australia and New Zealand are doing business. This is confirmed by company approaches to leadership and governance as well as management practices. However, few companies incorporate a comprehensive measurement framework in Corporate Responsibility reporting by identifying key performance data and changing their progress against targets. For more information see

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