What could motivate a small Factory owner to start with CSR?

Just follow the road, after the main village you enter the small village and then it’s after the RED DOOR” , Right,  ok, a red door in China, should be easy to find this time.  I made another factory visit last week, and it took me some time to find it again, as it had just moved from one location to another. This visit to a small Steel factory on the outskirts of Beijing was another interesting revelation for me on how a small, order based enterprise works: some months and weeks the workflow is huge, and the factory is busy with orders from seven in the morning till ten at night to get the products out on time. On other days, the factory is near empty and waiting, cats and dogs can wander into the factory as there is nearly any work to be done, and there are no doors or windows yet in the Factory Hall…What could motivate a small Factory owner to start with CSR?

The Factory Hall lay out

The Steel Factory has one owner, who is the manager in Charge; there are a few local staff members that he holds on even if there are no orders, the rest of the workers are hired when there are orders to be filled.  The Factory equipment is second hand and old, but functions perfectly, at the moment it is standing still and gathering dust. There is not a lot of equipment about, this is a low tech factory with some form of order in placing spare parts in the large hall, but there is no rack or shelving system, nothing is numbered, everything is on the floor.

Trust in Doing Business in China

In the office we have time to spare to talk about how foreign SMEs in China are doing, how to start up, who to trust (and not to trust), who to do business with; the Manager is very experienced in dealing with Chinese Suppliers, and sometimes visits their factories as well, to see what they can really offer. He likes building a long lasting relationship with Chinese Suppliers, based on mutual trust, to make business happen. And in contrary to what many say, this is possible in China; I hope to deconstruct that myth a bit.

Promoting Corporate Social Responsibility for SMEs, my challenge

The reason I visited this Factory was to get a better understanding of what it was to work as a foreign SME in production in China, and to see what the benefits of a CSR strategy could be for any company. But I found it quite hard to explain today! Who are the stakeholders of this company for instance? And who would bother to hold their stake? There is only one owner, a few employees at the moment, clients come and go with their orders.  What could motivate the small Factory owner to start with CSR?

Two things spring to mind: one thing, the attractiveness of this Company for Clients and personnel: and therefor the need of an update of the Factory: It could be a clean and organized (for instance using the Six Sigma method) lay out, and this would attract new clients, and doors and windows (winter is coming!) would help retain workers when the cold creeps in.

The other thing I should have asked more about, and that comes closer to the intrinsic motivation for CSR. The CSR process (when done well)  asks the owner , producer or manager why he want to makes his product or service, and why he or she is proud of it: in the quality of the product, lies a great motivation for servicing clients, consumers and employees.