THE VALUE OF VALUES - WHY COMPANIES INVEST IN BUSINESS STANDARDS

Sustainable development is not just about how a company can invest in community initiatives but also how it approaches complex issues such as ethics, transparency, health & safety and labour standards.

Applying sound business standards can contribute directly to improved competitiveness and a better reputation - but the fact is that reputation has to be earned and won through demonstrable measured action, not just PR.

If businesses do not lead on standards, they risk the negative impacts of loss of commercial opportunities, exclusion from international markets and a damage to their reputation.

Business standards are an issue that we are closely involved with in two key markets - Russia and China.

According to an influential survey published in January by Edelman, the Russian opinion elite trust businesses more than other institutions; but internationally, only 26% of people trust companies that are headquartered in Russia - making it the least trusted country for a company to be based in.

In China, the opinion elite interviewed said that a company’s overall reputation was just as important as the quality of goods of services. However, businesses in China are trusted less than either NGOs or governments.

"The leadership of any organisation has a vital role to play in shaping the trust placed upon it," says Robert Philips, CEO, Edelman UK. "Understanding what and who drives that trust is crucial."

So what is IBLF doing to build business standards...

...in Russia?

Russia is one of the fastest growing economies in the world, but its business reputation does not match its economic success. We have worked with leading Russian companies to help them demonstrate the role that better business standards can play in improving their international reputations.

"In order for Russian companies to build their reputation and improve their attractiveness to international markets, slick advertising campaigns and glossy social reports are clearly not the solution," says Brook Horowitz, executive director of IBLF Russia. "What is needed is a clear commitment by Russian business leaders to invest in the health and well-being of their own country's workforce, population and environment."
Read more on IBLF's 2008 corporate governance roadshow in Russia
Read how Troika Dialog has helped maintain its reputation with a corporate goverance programme

...and in China?

In China, our China Business Leaders Forum (a partnership with Renmin University) is bringing companies together to discuss issues related to business standards and transparency. In early April, for example, we will be holding a roundtable meeting for Chinese and foreign business executives to discuss "Transparency as a tool for crisis management."

"Through our work in China in recent years, we have found that companies are willing to tackle the issue of business standards - because they want their operations to be sustainable in the long term," says Peter Brew, head of IBLF's Asia programme. "The 300 business people that are part of our network in China are testament to this, and later this year, we will be establishing a China Centre for International Standards that will take the work of supporting responsible business standards in China to a new level of activity and impact."

And of course, IBLF is ready to work with more companies to help them turn a desire to lead on better business standards into real, measurable actions on the ground – not just in Russia or China, but all over the world.