| BASF (China) Co., Ltd: Innovative CSR Initiative Leads to Bee Effect |
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| 2009-05-13 16:28 CSR in China, China WTO Tribune |
In today’s business climate, Corporate Social Responsibility (CSR), with the rise of its concept and practice, is considered a crucial impetus in the construction of the harmonious society and realization of sustainable development. As the world’s leading chemical company, BASF believes it should not only implement CSR itself, but also lead other companies along its supply chain and the entire industry to implement such a vital system. Only by supporting the companies along the supply chain to improve its environmental protection and safety management can the company find the best way to meet its commitment to social responsibility and promote competitiveness down the supply chain.
With this concept, BASF proposes the “1+3” CSR project to build a responsible supply chain by spreading and sharing the principles and practices of Responsible Care (RC) to further the CSR footprint in the chain.
“1+3” Building a responsible supply chain
The “1+3”CSR project is an innovative idea for the supply chain CSR. In October 2006, under the platform of the China Business Council for Sustainable Development (CBCSD), BASF initiated the project.
In short, the 1+3 model is a system that follows the model of "1 CBCSD member company + 1 supplier + 1 customer + 1 contractor". In this way a company passes on the CSR concept to small and medium enterprises (SMEs) along its supply chain. It guides these partners by means of providing the best practice, professional knowledge, and customising solutions to raise CSR awareness and how the system can be implemented into normal operations. The three partner companies then each introduce the same concept to three further business partners in their own supply chain. A snowball effect is thus created.
There are six BASF “1+3” partners participating in this project at present. They include Huafeng Group, Guangzhou Liby Enterprise Group Co., Ltd., Sinochem International Corporation, Beijing Plaschem Trading Co. Ltd., Zhejiang Kaipute Spandex Co., Ltd. and Zhejiang Qiming Pharmaceutical Co., Ltd.
Implementing the “1+3 ” CSR project
Obtaining support and commitment from executives of partners
As the International Chemical Manufacturers Association chair, BASF, followed by the Europe-China Business College, Bayer, Dow Chemical, Exxon Mobil, Merck Chemical, Degussa Cyprus, Romania Gate Haas, DSM and other companies invited the leaders of 25 Chinese chemical enterprises to participate in "Responsible care (RC)" training in December 2006. This instilled in them a sense of the CSR concept importance as well as recognition of how it could be implemented through their business.
"Ambassador + Expert": customising the collaboration of BASF partners
BASF distributed a customer questionnaire to determine the priorities of each partner. The feedback was then collated to establish its internal business departments and create a project group for every customer. Each included a BASF customer representative and an expert in charge of Environment, Health and Safety (EHS). BASF business representatives are named as ambassadors that form the pattern of "Ambassador + Expert". BASF also customised a plan for every partner, which was adopted to meet the needs of each enterprise. The plan not only helped partners to enhance their CSR management capability, but also helped them strengthen their weak CSR strategies.
Sharing RC experience through seminars, forums and visits
The project firmly stuck to the rules of RC. From seminars and training to the visit and implementation, BASF has a close relationship with its partners, sharing experiences and practices in carrying out the RC rules. In addition, BASF offers a tailored program according to the partners’ requirements.
Project groups then carried out the “Eyes for Safety” visit. These involved going separately to each partner’s production base to get a comprehensive understanding of the situation in terms of safety, environmental protection and health issues. Afterwards, the group considered the next steps in their cooperation. In addition, partners were invited to BASF’s bases, studying the excellent management system of the company.
In the implementation phase, the project group provided training to address common problems faced by all companies, such as occupational health and safety, environmental protection and production safety. Every project group also reviewed one of their partner’s reform strategies.
Carrying out self-assessment and improvement mechanism
After the implementation for a certain time, BASF advocated self-evaluation and put up assessments based on the reforming of each project enterprise.
In October 2007, the company held a top executive meeting in Nanjing, Jiangsu province, in which BASF introduced a RC self-assessment system to all “1+3” partners. The purpose was to help the partners set up an improvement mechanism to ensure sustained improvement in CSR practices.
In January 2008, BASF handed out the questionnaires of the self-assessment reports to six “1+3” project partners. They completed and submitted their reports to BASF in March and received feedback from company experts over the next two months.
Periodical sum-up
To ensure its partners operated in a manner emphasizing constant improvement, BASF hosted the “1+3” CSR self-assessment seminar on July 28 in Shanghai. Senior executives from six “1+3”project partners and the BASF project team attended the roundtable discussion.
During this time, BASF experts presented detailed analysis on RC six codes and best practices, and also conducted training for its partners. Senior executives and experts held a round-table meeting, discussing concerns and their problem-solving techniques with regards to the EHS management system and CSR practices.
The seminar is regarded as an important milestone of the BASF "1+3" CSR project. All participating companies will further implement their social responsibilities by putting more CSR ideologies into practice.
BASF "1+3" Project timeline
October
2006 BASF “1+3”CSR Project launched The project is launched at the CBCSD CSR seminar. Three BASF partners take part in the training on sustainable development reporting guidelines and that of the recommend CSR standards.
December
2006 "Reponsibility Care" workshop Six enterprises have become BASF’s "1+3” project partners.As the International Chemical Manufacturers Association chair, BASF, followed by the Europe-China Business College and other multinational companies in the industry, invited the leaders of 25 Chinese chemical enterprises to participate in "Responsible Care" training.
January
2007 Questionnaire dispatched Based on the questionnaire, BASF determines a partner’s priorities.
February
2007 BASF teams established According to a partners’ priority area of cooperation, BASF organises six project teams, each composed of a customer representative and an expert in charge of environment, health and safety.
March
2007 The “Eyes for Safety” visit Six project groups separately go to their partner’s production base to get a comprehensive understanding of the management situation concerning EHS.
April
2007 Visits to BASF production base Delegates from six project partners visit BASF’s factories.
May
2007 Settlement of next steps and reform plans BASF teams draw up reform plans with the six partners separately.
June
2007 Sharing the RC practice REACH training; "Safety leadership" workshop; training and activities on media relations management.
July
2007 Exchange of experience concerning sewage treatment; road safety training and assistance in security assessment.
August
2007 Occupational medicine and health protection workshop held in Hangzhou, Zhejiang province.
October
2007 Self-assessment and improvement BASF “1+3” CSR Project Top Executive Meeting held in Nanjing: BASF commits to supporting partners to set up their own self-assessment system and introduces the long-term mechanism for improvement.
Senior executives from six "1+3" project partners participate in a series of events. They include a top executive meeting and a visit to BASF's pavilion on the Germany Esplanade in Nanjing and BASF-YPC Co., Ltd.
January
2008 Regarded as a best practice case The “1+3” project is regarded as a best practice case by the United Nations Global Compact in January 2008.
March
2008 Self-assessment report Six “1+3” project partners complete BASF questionnaires and submit their self-assessment reports.
May
2008 Project partners receive feedback from BASF experts.
July
2008 Periodical sum-up BASF hosts the “1+3” CSR self-assessment seminar.
The Fruit of “1+3”CSR Project
Improving competitiveness down the supply chain and creating new customer relations
BASF not only implements its CSR strategy through the "1+3" project, but also disseminates this idea to its partners. By establishing common values with partners, BASF broadens the platform for facilitating dialogue with them, thereby putting an innovative customer relationship into practice. A mutual confidence is established between the two sides, effectively laying the foundation for a long-term strategic partnership. This not only strengthens BASF's internal inter-departmental cooperation, but also reduces risk down the supply chain.
Raising awareness of CSR amongst participating enterprises and satisfying their developmental needs
As China’s economy is increasingly integrated into the global economy, improving CSR and building its strategy into operations has been essential to maintain core competitiveness. In this respect, the six enterprises participating all believe the launch of this project is just what they need. Through the project they have benefited from free access to learn advanced management techniques from a large multinational corporation such as BASF.
Within the process of implementation, BASF’s six project partners have integrated the “1+3” concept into their corporate strategy by concerning the employee’s workplace and company’s surrounding and strengthening dialogue with various stakeholders. They also hold seminars on process safety management system and CSR practices and moreover, the partner submitted the CSR proposal to the National Peoples Congress. At the same time, the partners focused on the reduction of emissions in the production process, promoting the concept of CSR and RC in their own supply chain.
Role-modeling effect
In January 2008, the BASF “1+3” CSR project, regarded as a best practice case by the United Nations Global Compact, has been shared among the Compact members and enterprises. To date, the project has reached 55 companies in China.
The project also received great support from the CBCSD member enterprises in its initiation period. In April 2007, member corporations, including COSCO, Sinopec and Baosteel, together with their partner corporations, officially launched the "1+3" project at the CBCSD Member Conference. They also put forward a proposal that all enterprises should consciously implement their corporate social responsibility, which was made to promote the CSR concept and to construct a harmonious society.
Bee Effect: 1+3=∞
After the successful implementation of the “1+3” CSR Project, BASF, as the initiator and funding partner, launched the "Golden Bee" concept with the WTO Tribune by using the analogy of honeybees, highlighting how they co-exist with nature in a harmonious and win-win manner. With the cooperation of the WTO Tribune and China Ocean Shipping(Group) Company, the "2007 Golden Bee CSR China Honor Roll" was announced in April 2008, aimed to promote the development of CSR in China. Sixty of the 205 candidate enterprises stood out as pioneers and models for CSR implementation among the corporations in China.
Bees are insects beneficial to human beings. By collecting nectar and turning it into honey, the insects not only meet their own needs, but also supply us with honey. In addition, as a pollinator, a bee is fundamental to the existence and reproduction of plants. Bees play a role of a harmonious messenger in the whole biological chain.
BASF can be seen as such a bee. It strives to pass on and apply its experience and technology to its own suppliers, logistics providers and customers. On the premise it should continue to help partners to improve their implementation of responsibility, BASF itself also benefits from the supply chain. Just like a bee connecting a harmonious relationship between plants and human beings, the company connects a symbiotic relationship of mutual benefit with its suppliers, logistics providers, customers and other partners.
BASF firmly believes greater responsibility leads to stronger competitiveness. Since the sustainable development in China cannot be realized merely by large companies which emphasize sustainable development, BASF, hopes more influential enterprises will gradually join in. Large enterprises have the potential to spread their CSR experience to large numbers of SMEs along their supply chains, which has a bee-like pollinating, or cascading effect. Following this model, the partners benefitting from their involvement in the project would commit to continuing the 1+3 model and so the partners soon triple and so on. If such a process continues, the effect will be similar to a starting a prairie fire and a new paradigm will be created, linking and developing large enterprises and SMEs. With more enterprises participating, further innovation would become inevitable and the practice of the 1+3 model would become an act of vital importance influencing all businesses and the entire society. In this way, every company should become a disseminator and beneficiary of its CSR.
About the Authors:
Lucy Li, Senior Manager of Corporate Social Responsibility, BASF Greater China.
Cui Zheng, Communication Manager of Development Center for Chinese CSR, China WTO Tribune.
About the Company:
BASF is the world's leading chemical company: The Chemical Company. Its portfolio ranges from oil and gas to chemicals, plastics, performance products, agricultural products and fine chemicals. With its high-value products and intelligent solutions, BASF plays an important role in finding solutions to global challenges such as climate change, energy efficiency, nutrition, transportation and mobility. BASF has over 95,000 employees and posted sales of almost ü58 billion in 2007. Further information on BASF is available on the Internet at www.basf.com
BASF has been a committed partner to Greater China since 1885. It is one of the biggest foreign investors in the Chinese chemical industry. The company now has more than 6,000 employees and operates 23 wholly owned subsidiaries and 10 joint ventures. In 2007, BASF achieved sales of about $4.4 billion in Greater China.
(CSR in China, China WTO Tribune)
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