Corporate Social Responsibility (CSR) is rapidly gaining in importance in China. No longer is it merely seen as a necessary evil to gaining access to key European and US export markets. It is also viewed as an integral part of a company’s corporate strategy, and an effective instrument in promoting sustainable growth and the development of a “harmonious society”. Chinese government institutions, industry associations, and stock exchanges, as well as cities and regions, now actively promote CSR by issuing guidelines, developing comprehensive CSR standards, and encouraging CSR reporting. Moreover, international buyers have moved beyond simply demanding CSR compliance from their suppliers and are increasingly partnering with Chinese companies to help develop their CSR capacity. However, driven by foreign and increasingly domestic forces, Chinese suppliers and foreign buyers also face a number of challenges and opportunities in building sustainable international supply chains. In response to these emerging trends, the Sino-German CSR Project held a conference on “Sustainable Supply Chains in China-Challenges and Opportunities for Chinese and German Companies” at the Belgian EU Pavilion, Expo 2010 Shanghai, on 14 July 2010. The purpose of the conference was to provide a platform from which stakeholders could openly exchange their experiences and best practices with incorporating CSR into supply chains in China. Around 60 representatives from governments, industry associations, enterprises, and academia from both China and overseas attended the event.

Dr. Astrid Skala-Kuhmann, Country Director of GTZ China, opened the conference and Mr. Hans-Jürgen Beerfeltz, State Secretary of German Federal Ministry for Economic Cooperation and Development (BMZ), and Mr. Kang Bingjian, Director of Department of International Trade and Economic Affairs, Ministry of Commerce of the People’s Republic of China (MofCom), delivered keynote addresses that highlighted the importance of CSR in developing and enhancing international supply chains.

During the first session, representatives from the China WTO Tribune, the German Chamber of Commerce in China/Shanghai, and the China National Textile and Apparel Council (CNTAC)presented an overview of the current trends and approaches to CSR implementation in China. A discussion centering on the major challenges confronting the implementation of CSR and the available solutions to these challenges followed.During the second session,BASF, TUV, Shanghai Guanhua Stainless Steel Product Co., Ltd., and Hebei Huatong Wire & Cable Co., Ltd., shared with attendees their practical experiencesand best practices with responsible management.

A panel discussion on successful approaches to scaling up CSR in Chinese suppliers also took place and questions on how best to facilitate communication between workers and management, as well as the role of the Chinese government in promoting CSR and the role of NGOs in facilitating CSR were raised. Several panellists spoke of the importance of getting management-level buy-in and support if CSR implementation was to be successful at the company level. Participants also acknowledged the greater role that the Chinese government and industry associations could play in coordinating CSR promotion activities. Opinion differed on the role of NGOs, with some attendees talking about the vital role that these organizations could play in developing CSR, and others suggesting that a lack of transparency in the NGO landscape creates cooperation challenges. An international certification company suggested that establishing an international multi-stakeholder exchange mechanism to facilitate the sound development of supply chains would be a positive move; and one Chinese supplier argued that international buyers need to take a more responsible role in guiding Chinese companies on how to comply with international social standards.

The half-day conference ended with comments from Mr. Rolf Dietmar, Programme Director at the Sino-German CSR Project, who thanked the audience for its participation and overall contribution to the event, and also for its role in helping the Sino-German CSR Project assess the direction of its future work.