ed Miserly foreign firms

Haven’t they heard of corporate social responsibility?

Today’s profit-oriented businesspeople might think corporate social responsibility (CSR) is a 21st-century concept. They are wrong.

In the early years of the 20th century, U.S. President Theodore Roosevelt said, ``I believe that they (business corporations) should be so supervised and so regulated that they shall act for the interests of the community as a whole.”

Korean society glaringly fails in this area, and nowhere is this clearer than in the business practices of some foreign-invested companies operating here.

A National Tax Service report shows that about 1,420 foreign-invested firms that paid corporate taxes last year made combined contributions of 3.67 billion won ($3.1 million) to Korean society, a paltry 2.5 million won per firm. During the period, they spent 62.2 billion won on entertainment expenses, roughly 17 times that of social contributions.

What all these figures show is unmistakable: the foreign businesses were bent on making money, even through potentially unethical methods of bribes and lobbying, rather than giving part of their revenues back to the host and consumers.

Especially disappointing are the practices of luxury goods makers. According to the analysis of Chaebul.com, the combined turnover of the top-15 manufacturers of brand-name products totaled 3.87 trillion won, and their net profits reached 236.4 billion won last year. They saw their net income grow three-fold the past six years with some registering a six-fold increase.

Most of their earnings went to their shareholders as dividends, and their contributions to Korea stood at a minuscule 0.32 percent of net profits. Three ― Prada, Bvlgari and Swatch ― gave not a single won for six years. Nor did most of the foreign firms reinvest their earnings here, indicating they have little intention of neither taking deep root in this country nor making bonds of any type with the host society.

In stark contrast, Everland Co.’s Chinese offshoot recently received a grand prize from the Beijing government for corporate philanthropy. The Samsung Group affiliate donated 10 percent of its profits to the regional society in the form of free medical services, emergency relief kits and scholarships.

Enviable is China’s confidence in selecting foreign direct investment and its gusto to demand foreign firms become good corporate citizens in their land.

It is the Korean officials’ ― and consumers’ ― job to make foreign firms realize that this is no country where greedy, profit-blind businesses can prosper. These selfish foreign investors, like financial speculators, cannot provide much help for a host society.

More importantly, such petty, shortsighted practices cannot lead to sustainable management even without citing the first of the three CSR prerequisites ― ethics, environment and non-exploitation.

It makes little sense Korea still cannot practice what a U.S. president preached a century ago.