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Oxfam Hong Kong and Corporate Social Responsibility

 

Oxfam Hong Kong (OHK) believes that when the private sector adopts policies and practices on Corporate Social Responsibility (CSR) in its operations, it helps translate the positive aspects of its business activities, such as economic growth, fair labour practices and good environmental protection, into development that favours poor people. All of this is in line with OHK’s vision of alleviating poverty. OHK works to influence companies to improve their policies, practices and avoid harming people and the environment. Through promoting CSR, OHK also aims to encourage investors to make ethical investment choices.

 

That is why we have published a variety of reports on these issues over the years. In 2004, for instance, we released the research report ‘Turning the Garment Industry Inside Out – Purchasing Practices and Workers’ Lives’. In 2006 and 2009, we published parts I and II of the ‘Transparency Report’ which, again, looked at the garment sector and focused on companies in Hong Kong and mainland China.

 

In both 2009 and 2010, OHK published research on the CSR performance of Hang Seng Index (HSI) constituent companies. Since 2010, we have also extended our advocacy work to regulatory bodies, and have handed in two submissions concerning the rewrite of the Companies Ordinance as well as Environmental, Social and Governance (ESG) reporting to the Financial Services and Treasury Bureau and Hong Kong Stock Exchange respectively. In 2015, we began to engage with institutional investors by conducting a survey to collect their views on ESG reporting requirements for listed companies. The research findings were compiled as a submission in response to Hong Kong Stock Exchange’s consultation on the ESG reporting guide.

 

Reference link: OHK’s CSR Work

 

Past HSI CSR Surveys

 

2008 Survey

 

2009 Survey

 

Report Links

2008 Survey (Report Download)

 

2009 Survey (Report Download)

 

2016 Survey (Report Download)

 

As the latest survey’s framework differs from that of previous surveys, the current survey cannot be compared to those from the past.

 

About this Survey

 

In recent years, the international community has increased its expectations with regard to CSR; as a result, reporting standards have been raised as well. In 2013, the Hong Kong Stock Exchange (HKEx) published its first ESG reporting guidelines and recommended issuers to follow them. To be on par with international standards, the HKEx completed a consultation exercise in 2015, and raised its reporting obligations to ‘comply or explain’ on general disclosure in all aspects in January this year. In other words, only general policies—and not Key Performance Indicators (KPIs)—require disclosure. More stringent reporting standards that require the disclosure of environmental KPIs will be elevated to ‘comply or explain’ in 2017 as well. So as to understand HSI constituents’ CSR performance, OHK commissioned RepuTex to conduct a survey on HSI constituents’ ESG transparency and quality between October and December 2015. Through the survey, OHK aims to provide the public with more information to better monitor and promote CSR in the private sector.

 

Research Methodology

 

Data Collection

OHK based this research on publicly available information (e.g. company websites, annual reports and sustainability reports, market regulatory compliance and financial data). In addition, all 50 companies were invited to complete a questionnaire to provide additional information to verify their performance and modify the results. The companies were then ranked according to the final results.

 

Company performance in this survey was appraised according to companies’ degree of transparency, comprehensiveness of information, and management and monitoring systems, where as previous studies looked at whether or not policies were in place.

 

OHK looked at all 50 of the HSI constituents, out of which 19 companies (38 per cent) provided additional information by completing questionnaires.

 

 

Rating

Companies were appraised in terms of four key categories: Corporate Governance, Environmental Impact, Social Impact and Workplace Practices, which covered more than 50 indicators.

 

The workplace practices category is generally grouped under the social aspect within the ESG universe. OHK believes that workplace practice is of crucial importance to improve the livelihoods of workers and hence alleviate poverty. Workplace Practices was thus separated as an independent area for rating to show how companies performed with regard to labour rights protection.

 

Each ESG performance indicator was given a score; these were then weighted and aggregated to provide an overall category score. Each category carries equal weighting—25 per cent—and the total score is 100 per cent. Category scores were added together to provide an overall performance rating. The ratings are: ‘Reliable’ (i.e. companies received a score of 66 per cent or above), ‘Satisfactory’ (i.e. between 56 and 65 per cent) and ‘Unstable’ (i.e. 55 per cent and below).

 

 

Limitation

The research is based on publicly available information for the purpose of rating company performance. The research did not survey and evaluate criticisms that these companies face in the media and from civil society.

Oxfam Hong Kong and Corporate Social Responsibility

 

Oxfam Hong Kong (OHK) believes that when the private sector adopts policies and practices on Corporate Social Responsibility (CSR) in its operations, it helps translate the positive aspects of its business activities, such as economic growth, fair labour practices and good environmental protection, into development that favours poor people. All of this is in line with OHK’s vision of alleviating poverty. OHK works to influence companies to improve their policies, practices and avoid harming people and the environment. Through promoting CSR, OHK also aims to encourage investors to make ethical investment choices.

 

That is why we have published a variety of reports on these issues over the years. In 2004, for instance, we released the research report ‘Turning the Garment Industry Inside Out – Purchasing Practices and Workers’ Lives’. In 2006 and 2009, we published parts I and II of the ‘Transparency Report’ which, again, looked at the garment sector and focused on companies in Hong Kong and mainland China.

 

In both 2009 and 2010, OHK published research on the CSR performance of Hang Seng Index (HSI) constituent companies. Since 2010, we have also extended our advocacy work to regulatory bodies, and have handed in two submissions concerning the rewrite of the Companies Ordinance as well as Environmental, Social and Governance (ESG) reporting to the Financial Services and Treasury Bureau and Hong Kong Stock Exchange respectively. In 2015, we began to engage with institutional investors by conducting a survey to collect their views on ESG reporting requirements for listed companies. The research findings were compiled as a submission in response to Hong Kong Stock Exchange’s consultation on the ESG reporting guide.

 

Reference link: OHK’s CSR Work

 

 

Past HSI CSR Surveys

 

2008 Survey

 

2009 Survey

 

Report Links

2008 Survey (Report Download)

 

2009 Survey (Report Download)

 

2016 Survey (Report Download)

 

As the latest survey’s framework differs from that of previous surveys, the current survey cannot be compared to those from the past.

 

About this Survey

 

In recent years, the international community has increased its expectations with regard to CSR; as a result, reporting standards have been raised as well. In 2013, the Hong Kong Stock Exchange (HKEx) published its first ESG reporting guidelines and recommended issuers to follow them. To be on par with international standards, the HKEx completed a consultation exercise in 2015, and raised its reporting obligations to ‘comply or explain’ on general disclosure in all aspects in January this year. In other words, only general policies—and not Key Performance Indicators (KPIs)—require disclosure. More stringent reporting standards that require the disclosure of environmental KPIs will be elevated to ‘comply or explain’ in 2017 as well. So as to understand HSI constituents’ CSR performance, OHK commissioned RepuTex to conduct a survey on HSI constituents’ ESG transparency and quality between October and December 2015. Through the survey, OHK aims to provide the public with more information to better monitor and promote CSR in the private sector.

 

Research Methodology

 

Data Collection

OHK based this research on publicly available information (e.g. company websites, annual reports and sustainability reports, market regulatory compliance and financial data). In addition, all 50 companies were invited to complete a questionnaire to provide additional information to verify their performance and modify the results. The companies were then ranked according to the final results.

 

Company performance in this survey was appraised according to companies’ degree of transparency, comprehensiveness of information, and management and monitoring systems, where as previous studies looked at whether or not policies were in place.

 

OHK looked at all 50 of the HSI constituents, out of which 19 companies (38 per cent) provided additional information by completing questionnaires.

 

 

Rating

Companies were appraised in terms of four key categories: Corporate Governance, Environmental Impact, Social Impact and Workplace Practices, which covered more than 50 indicators.

 

The workplace practices category is generally grouped under the social aspect within the ESG universe. OHK believes that workplace practice is of crucial importance to improve the livelihoods of workers and hence alleviate poverty. Workplace Practices was thus separated as an independent area for rating to show how companies performed with regard to labour rights protection.

 

Each ESG performance indicator was given a score; these were then weighted and aggregated to provide an overall category score. Each category carries equal weighting—25 per cent—and the total score is 100 per cent. Category scores were added together to provide an overall performance rating. The ratings are: ‘Reliable’ (i.e. companies received a score of 66 per cent or above), ‘Satisfactory’ (i.e. between 56 and 65 per cent) and ‘Unstable’ (i.e. 55 per cent and below).

 

 

Limitation

The research is based on publicly available information for the purpose of rating company performance. The research did not survey and evaluate criticisms that these companies face in the media and from civil society.