New Zealand needs to listen to Asia
New Zealand, as an island nation, has certain characteristics. One is that we have the habit of looking inwards and talking to ourselves about business. Nothing gets us fired up like domestic angles on regulation, interest rates or infrastructure, and we talk until the cows come home (or are milked at least) about our economy.
These issues are important of course but we need to be thinking about the bigger picture too.
New Zealand businesses, and especially people in leadership roles, need to look at the international trends that affect what we do. Not just trade and market access or how to export but the key political, cultural and economic drivers in the markets we seek to access, and that seek to influence us.
One often sees international speakers on the bill for New Zealand business conferences but they tend to be from Australia or the United States. It is rare to hear from experts and thought leaders from Asia.
Perhaps we expect speakers from anglophone countries will know how to reach our business audiences and provide entertaining yet thoughtprovoking insights – and, of course, get the fee-paying bums on conference seats for future years.
But given that our economic future will be driven by Asia, these are arguably not the insights that will best serve New Zealand businesses in the future. They may even further distort our view of developments in Asia, when we should be hearing from the source.
When was the last time you heard about the US-China trade war from an informed, savvy, businessfocused Chinese commentator?
The Asia New Zealand Foundation has been partnering with New Zealand business conference organisers to bring top thought leaders from Asia – experts in the likes of artificial intelligence, guanxi (networks and connections), and corporate social responsibility.
A couple of weeks back, one of our Asia honorary advisers, Heekyung (Jo) Min, spoke on ‘‘creating shared value’’ at the annual conference of the Institute of Financial Professionals NZ. That is, how businesses can contribute to social and environmental goals while also enhancing their core business profitability.
Min is executive vice-president and head of corporate social responsibility at CJ CheilJedang, a massive Korean lifestyle conglomerate with annual revenue of over $40 billion – about the size of the NZ Super Fund. CJ has interests in food and food service, retail and logistics, entertainment and media, and biotechnology and pharmaceuticals. It operates in
27 countries around the world. The company has grown to be
22 times larger than it was when established in the 1990s and creating shared value has always been core business. CJ has purposefully looked for social problems to solve, seeing business value in doing so.
Min explained to conference attendees how in one project CJ had eliminated poverty in a rural Vietnamese village by teaching farmers to grow a species of chilli universally loved in Korean kimchi cooking. The project was sustainable, bringing farmers a steady income and the means to build their own schools, clean water facilities and other community projects. Plus, CJ needed the product. In another example, Korean seniors – who are growing in number, as Korea has an ageing workforce – were employed as courier drivers with purpose-built electric cars, delivering packages to their community and reducing their own social isolation.
All the while, these projects guaranteed CJ’s supply chain of chillies for its food business and endpoint logistics for parcels delivered. They also earned CJ a place in Fortune magazine’s 2017 list of 50 companies that will ‘‘change the world’’, further enhancing its brand with consumers.
Those familiar with the topic of corporate social responsibility will know that despite CJ’s prominent success, the North Asia region is still in the early stages of growing not only that facet but also its environmental, social and governance investing. Europe leads the charge, both in regulatory frameworks and in commitment from large corporations.
We are seeing, however, that in South and Southeast Asia there is a real growth in the social enterprise space. Take Indian giant Tata as an example. Two-thirds of its equity is held by trusts for philanthropy and its social impact projects reach more than 20 million people each year.
And as Min shared at the Institute of Financial Professionals conference, Chinese businesses are becoming increasingly interested in corporate social responsibility as they seek to increasingly use business and the free market to solve social and environmental problems previously seen as the responsibility of central government.
Where Asian and European businesses go, New Zealand will need to follow – or even lead, such as with the environment. But to maximise the opportunity, we will require best practice regulatory frameworks, better corporate social responsibility understanding across traditional businesses, and more experts from Asia prepared to share their experiences with New Zealand audiences.
We can’t be an island on this one.
In South and Southeast Asia there is a real growth in the social enterprise space.