Centrally-administered state-owned enterprises (SOEs), the backbone of China's national economy, have been urged to play a leading role in fulfilling social responsibilities and securing sustainable development.

 

Though not compulsory, some of the country's 152 SOEs directly under the State-owned Assets Supervision and Administration Commission (SASAC) will start this year to release regular reports for stake holders to evaluate their fulfillment of social duties.

SASAC, the watchdog of state-owned assets, has written the move into its first directive of the year, which defines social responsibility in a broad sense to cover environmental protection, energy and resources conservation, securing production safety, protecting the rights of employees and consumers, maintaining market order, upholding business ethics and philanthropy, repaying investors and creating job opportunities.

 

But the directive did not detail the frequency of the releases or how many SOEs would release regular reports this year.

 

Corporate Social Responsibility has evolved into a catchphrase in the global business community after the United Nations initiated the Global Compact in 2000, emphasizing the role of business in the areas of human rights, labor, the environment and anti-corruption.

 

Eleven centrally-administered SOEs including Baosteel, China Ocean Shipping (Group) Company and China Aluminum, have voluntarily joined multinationals to release reports on social responsibility and sustainable development.

 

Sources with the SASAC noted that the growing consciousness of social responsibility within China coincided with global trends and had profound political connotations.

 

China's centrally-administered SOEs, though still limited in strength and core competitiveness when compared with multinationals and first-class international companies, were the backbone of China's state-owned economy and an ultimate embodiment of government ownership for the public good, they say.

 

After nearly three decades of economic reforms and opening-up, the Chinese economy has turned from a monolithic state and collective-owned economy into a variety of ownerships with the state-owned enterprises at the core.

 

Private firms have experienced a rapid takeoff but remain in the fledging stage, hiring 69.3 million employees by last July, up 518 percent on the previous year, and possessing a combined registered capital of 8.3 trillion yuan (about 1.1 trillion U.S. dollars).

 

Shortly after the State Grid released its sustainable development report last year, Yili Group, a private dairy maker, came up with its own report on social responsibility.

 

In a lengthy explanation on the directive posted on its official website, the SASAC said that SOEs must reflect the "State Will" to seriously implement the scientific development outlook proposed by the governing Communist Party of China for the "dominant and irreplaceable" roles they have played in securing national economic lifelines.

 

Since the establishment of the SASAC in 2003, these companies had registered an average annual rise of one trillion yuan in sales revenue by 2006. Their annual profits and taxation grew by 100 billion yuan.

 

Kudos should go to Sinopec and PetroChina who pledged to increase output and imports to ease domestic fuel shortages despite the refined oil products being far cheaper than imports, said the statement.

 

An earlier report said 14 central SOEs were organized by the Chinese government to offer about 1,000 jobs to new graduates by the end of 2008, particularly those from low-income families.

 

Calling the centrally-administered SOEs the "bellweathers" in leading local companies into global cooperation, the SASAC said a responsible image and the capability to act responsibly will sharpen the cutting edge of domestic companies.

 

The directive also urged SOEs to integrate the sense of social responsibility into their corporate culture and governance, open more dialogues with global peers and participate in the constitution of international standards on business responsibilities.

 

But "a continuously rising profitability" was still underscored as a necessity for SOEs to better fulfill their social responsibilities.

 

(Xinhua News Agency January 9, 2008)