Businesses Play Key Role in Environmental Protection

Previous sustainable development forums rarely mentioned the roles businesses and entrepreneurs, but focused on the roles of governments, people, academia, non-governmental organisations (NGOs), and other stakeholders. However, with the current process of global economic integration, this approach has changed. In reality, out of global foreign direct investment (FDI) flows approximated US$580 billion (2010), more than a half is invested in developing countries. FDI value also more than quadrupled official development assistance - ODA (nearly US$130 billion). And above all, the awareness of pioneering companies in environmental issues is not only a matter of social responsibility but also a potential business opportunity.

 

According to the Vietnam Sustainable Development Strategic Orientation stated in Agenda 21 and governmental policies, VCCI has promoted and supported the participation of enterprises in the cause of environmental protection and sustainable development. VCCI established the Vietnam Business Office for Sustainable Development in 2006 and the Vietnam Business Council for Sustainable Development (VBCSD) in 2010. In addition to promoting corporate social responsibility in the country, these agencies have also strengthened international cooperation with the Greater Mekong Sub-region, ASEAN and APEC.

 

VCCI hosted 31 training courses on cleaner production and waste management for 2,226 executives from 1,492 companies in 30 provinces and cities across the country from 2012 to January 2015.

 

VCCI has also provided institutional consultancy and supported businesses to write Sustainability Reporting. This type of report is very popular in the world but is still quite new to a majority of Vietnamese businesses. Advantageously, Sustainability Reporting presents sufficient information for all activities and significant impacts of a business on administration, economy, society and environment. Sustainability Reporting illustrates the efficiency of using financial, social and natural resources of business.

 

Additionally, VBCSD is developing a Corporate Sustainability Index (CSI) with the aim of introducing a helpful tool for businesses to measure and assess the effectiveness of sustainable development based on three criteria: Economy, society and the environment. Currently, VCCI is also planning to integrate these indicators into corporate credit ratings and stock listings ratings.

 

With a constantly changing business environment and thinking of corporate responsibility, it is vital to have stronger measures to tap potential and promote the responsibility of the business community. We propose five following measures to uphold corporate roles in environmental protection.

 

First, building principles and purposes of environmental protection a specific, feasible, quantitative and well-defined manner; ensuring transparency and economic responsibility by means of measurable standards for evaluating businesses in implementing environmental protection policies.

 

Second, building economic partnership agreements that reflect harmonious interests of business and government in environmental protection. For example, environmental remediation will require technologies and skills and high skills must come from training. In this process, the Government must certainly have policies on new skills training for workers while businesses need highly levelled workers. In this area, there will be a lot of room for government - business partnership.

 

Third, building and implementing policies on environmental protection, especially policies relating to prices of products and services that protect the environment (such as renewable energy), enabling businesses to compute costs and profitability in business management strategies and plans for such products and services.

 

Fourth, introducing policies to encourage businesses to direct their financial flows from environment-polluting traditional manufacturing sectors to environment-friendly and more sustainable sectors.

 

Finally, in fact, only a handful of Vietnamese companies, usually big ones, integrate environmental protection tasks into their core strategies and operating programmes. Meanwhile, small and medium enterprises (SMEs), which account for nearly 98 percent of companies in Vietnam, do not tie their business operations to environmental protection. We need policies to stimulate SMEs to take part in environmental protection. The amendment to the Law on Social Enterprises is a positive move. We need specific policies to achieve it in this sector.

 

With the Government-backed policies on open international economic integration and sustainable socioeconomic development, the role and responsibility of the business community is increasingly important in a rapidly changing world. As a representative for businesses, VCCI wishes to cooperate with all of you in information, advice, training, consultancy and construction and enforcement of environmental protection policies.