Chemicals in Asia and the role of corporate responsibility- another look at Tianjin

This blog post is a recycled post from my PhD research overview from last year, with some new questions and a more focused research question on culture and business ethics. The field research topic on the Chemical Industry in Asia is as relevant as always. A next Tianjin is not far away. The events there from the past few days have shown that the rules on safety and environment for chemical products logistics and manufacturing are excellent in China. The practical execution, governance, inspection, and reaction on disasters ….well…

For more news on my PhD research, follow the tag Chemical Industry here.

My main research is on:

A study on the effective implementation of business codes indifferent cultures.

China, India and Indonesia are rising as economic powerhouses in the business world of today. With the rise of the economic power, the self-awareness of these countries with their own culture in doing business is rising as well.  In combination with the struggle to keep operational costs low in the fierce competitive market, Western companies that are active in Asia struggle to find a balance between profit and their business ethics, as Asian countries often lack strong regulations (or lack the governance and enforcement power) on environmental and labor protection.  Recent business scandals across Asia have shown that Western companies are struggling to do what is right, both legally and morally, be it in the field of competitiveness, supply chain management and labor rights or violations of labor laws by main suppliers.

The chemical industry

In this struggle Western companies often have a unique role. Both international and local non- governmental organizations (NGOs) as local governments look at Western companies to set the right example in carrying out international guidelines on environmental protection, labor rights, fair wages etc.  Even more in the chemical industry in Asia, where the impact of said industry is substantial compared to other industries in terms of economic and environmental impact.   There is a huge pressure on Western chemical companies to do the right thing, in a very competitive market, a market where state owned companies are often strongly supported by government, and regulative external structures are failing or are not in place.  Also, when things go wrong in the chemical industry, the environmental damage can be significant, and the costs for environment and society substantial.  Therefore, if western chemical companies would come to understand what a more effective way would be to implement their business ethics through international business codes, they would not only help themselves by abiding to their approved rules but also have a positive effect on their surroundings be it their clients and suppliers, the environment and people who work for them, and set a positive example for the non-Western chemical industry in Asia.And for the field research.

The research Process
This research will focus on how culture affects the implementation of an international business code   into a foreign division of Western (multinational) company. When a multinational company decides to operate in a foreign country, it will be in some extent aware that the culture of that host country will differ from headquarters’ culture.  And although the business code of conduct is meant to be implemented in all their divisions around the world, they may experience difficulties in implementing their codes due to cultural factors. How can multinational companies implement in an effective way their international business codes in other countries than their original country? To find out what the most effective strategy is, this PhD research project will contain field research within these Western companies, an in depth research into their main challenges in implementing the codes in their foreign branches, and a comparison of the effects of the implementation in different countries in Asia.  For methodological reasons, the field research into the implementation of codes of conduct will be limited to the Western chemical industry, and their operations in Asia (China, India and Indonesia).