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BEYOND PROFITS: Businesses need to see that the true nature of all economic activity is for the people, said Mr Lim.
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COOPERATIVES such as FairPrice were the original practitioners of corporate social responsibility (CSR) as they considered factors other than profits in running their businesses.
And they can serve as role models for other businesses, said Mr Lim Boon Heng, Minister in the Prime Minister's Office at a luncheon yesterday.
He was speaking at the Singapore Institute of Directors' 9th annual general meeting luncheon held at the Raffles Hotel.
Mr Lim reminded the audience of over 50 directors of Singapore-listed and private companies that CSR 'requires an organisation to consider the interests of the society'.
He said: 'Businesses need to look beyond making profits and recognise that, ultimately, the true nature of all economic activity should be - and is - for the people and for the community.'
Noting that 'many businesses use CSR as a marketing gimmick', Mr Lim acknowledged that it would 'take a long time before we have enough companies truly operating as good corporate citizens'.
Profit-driven companies may place a limit on CSR as shareholders' demands for better returns take precedence.
'So, we need cooperatives to act as role models to showcase the true value of CSR,' said Mr Lim. He noted that co-ops are businesses 'built on the basis of CSR', as they are committed to social ends and are 'founded by the people, for the people'. Their goals include providing jobs and improving the quality of life without sacrificing competitiveness. This makes them 'counterbalances to the excesses of free market and globalisation', said Mr Lim.
He cited the example of FairPrice, which brought in alternative supplies and held prices steady when the supply of vegetables was disrupted due to Sars.
Similarly, during the bird flu outbreak in the region, traditional sources of egg supply were affected, causing a shortage. FairPrice brought in eggs from other sources to stabilise prices, instead of tapping these opportunities to make exceptional gains at the expense of the community.
Mr Lim also emphasised the need for companies, including co-ops, to attract the best talent and build an institutional culture to sustain their businesses.
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