City Developments Limited’s Sustainability and Social Responsibility

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Introduction

Background

Environmental sustainability has recently become a declared goal of many prominent business enterprises. However, certain companies were ahead of time and showed the capabilities of transformational leaders, such as idealized influence and intellectual stimulation (Bass, as cited in Buil et al., 2019, p.2). A Singaporean developer City Developments Limited (CDL), and its Corporate Social Responsibility (CSR) Committee integrated ideas of environmental sustainability with its business and operations in the mid-1990s (Chiat & Joshi, 2013). Over the years, CDL has become a champion of sustainability practices in Singapore and received numerous environmental awards (Chiat & Joshi, 2013). The company created a positive image of a progressive business enterprise that values social responsibility highly.

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Purpose

The overall success of the organization and its financial results is an important measure of capable leadership. However, success alone does not define successful leadership (Palmisano, 2008, as cited in Strielkowsi & Chigisheva, 2018). Giampietro-Meyer et al. (1998) argued that transformational leaders could inspire the followers while being self-centered and even unethical (as cited in Korzynski et al., 2021). Nevertheless, CDL managed to achieve financial success while adhering to proclaimed moral standards and ethical ideals of sustainability. In the 2012 financial year, CDL recorded a $2,72 billion revenue and $699 million profit after tax (Chiat & Joshi, 2013). Therefore, the purpose lies in understanding how CDL managed to strengthen the idea of sustainability on organizational and leadership levels.

Discussion

Identification of Issues

In order to analyze the case of CDL, it is necessary to address methodological issues. In particular, it is required to select theoretical approaches to leadership, decision-making, and corporate organization. Regarding the leadership aspect, the transformational approach seems suitable since CDL appears to be a visionary company in relation to sustainability. Therefore, CDL’s attitude towards sustainability will be evaluated from the perspective of four transformational leadership criteria.

Decision-making will be judged within the framework of the rational choice paradigm. Certainly, humans appear to be prone to systematic errors in reasoning, judgment, and decision-making (Vlaev, 2018). However, CDL’s actions regarding sustainability and social responsibility seem to be well-thought, strategic, and not dictated solely by a wish to obtain a better moral outlook than the competition. This section will contain an evaluation of CDL’s staff sustainability strategy within the rational choice paradigm.

Finally, CDL emphasized synergy and teamwork with their partners, stakeholders, and even local communities on the organizational level. According to Puig-Roca (2019), synergy means “the interaction of two or more organizations to produce a combined effect greater than the sum of their separate effects” (as cited in Younus et al., 2019). Therefore, CDL’s approach can be seen as a synergetic effort in which CDL and its partners combined their forces to promote sustainability and social responsibility.

Solution: Application of Selected Approaches to CDL’s case

Leadership The CDL’s approach to environmental sustainability fits all four criteria of transformational leadership:

  • Idealized influence: CDL was ahead of time in declaring CSR Vision as “to be the champion of CSR” and CSR Mission of “conducting sustainable business practices and protecting the environment” in the mid-90s. Meanwhile, the Monetary Authority of Singapore stated that sustainability should be considered an important part of corporate governance only in 2012 (Chiat & Joshi, 2013);
  • Inspirational motivation: CDL articulated motivational goals in its CSR philosophy. The company expressed commitment to stakeholders, customers, employees, contractors, suppliers, and local communities (Chiat & Joshi, 2013);
  • Intellectual stimulation: in the words of Mabel Wong, Senior Manager, Property and Facilities Management, “We all walk the talk, all the way from top-down” (Chiat & Joshi, 2013). An inclination towards collectivism, shared goals, and emphasis on competence is natural for Singaporean culture (Koh et al., 2018). As a result, CDL’s corporative standards encourage employees to push themselves to new heights, regardless of their positions;
  • Individualized consideration: in addition to articulating employees’ well-being and career development as a point of CSR philosophy, CDL incorporated its own enhanced human rights corporate statement.

Decision-making CDL’s approach to sustainability and social responsibility looks well calculated and structured, although those matters were far beyond legislative requirements of the time. Therefore, it fits into the breakdown of the rational choice paradigm:

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  • Subjective expected utility — CDL was first to see CSR and sustainability as a source of benefits, not a cost, thus giving them a high value;
  • Decision-making process
  • Problem identification: impact of development activities on the environment;
  • Decision process: non-programmed, since CDL was a pioneering company and had to develop its own solutions;
  • Possible choices: following existing regulations or setting own, high standards;
  • Choosing the best alternative: CDL went for investing in sustainability and CSR to gain a competitive reputational advantage;
  • Choice implementation: CDL developed a particular CSR and sustainability strategy to implement its rational choice

Organization CDL prioritized teamwork in order to raise awareness of sustainability and CSR among their suppliers, investors, and stakeholders. Puig-Roca (2019) argued that the lack of sustainability could lead to a vicious circle, which consolidates itself over time. In that regard, CDL showed a visionary approach by including synergetic interaction with its partners in CSR strategy. CDL’s awareness program incorporates measures for contractors, suppliers, customers, employees, and local community members (Chiat & Joshi, 2013). Therefore, CDL attracts extra agents to the sustainability agenda and promotes CSR awareness in Singapore and beyond.

Conclusion

CDL successfully championed environmental sustainability and CSR over the decades. The company made a rational choice in favor of sustainability, showed transformational leadership and commitment to proclaimed values, and engaged its employees and partners in synergetic teamwork. As a result, CDL managed to influence Singaporean government institutions, which recognized sustainability as a part of corporate governance. Overall, CDL’s case can be viewed as an example of visionary leadership, wise decision-making, and well-executed organizational work.

References

Buil, I., Martínez, E., & Matute, J. (2019). Transformational leadership and employee performance: The role of identification, engagement and proactive personality. International Journal of Hospitality Management, 77, 64-75. Web.

Chiat, H. S., & Joshi, H. (2013). City Developments Limited: a journey in sustainable business development. Emerald Emerging Markets Case Studies. 3(8), 1-13. Web.

Koh, C., Fernando, M., & Spedding, T. (2018). Exercising responsible leadership in a Singapore context. Leadership & Organization Development Journal. 39(1), 34-50. Web.

Korzynski, P., Kozminski, A. K., Baczynska, A., & Haenlein, M. (2021). Bounded leadership: An empirical study of leadership competencies, constraints, and effectiveness. European Management Journal, 39(2), 226-235. Web.

Roca-Puig, V. (2019). The circular path of social sustainability: An empirical analysis. Journal of Cleaner Production, 212, 916-924. Web.

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Strielkowski, W., & Chigisheva, O. (2018). Social, economic, and academic leadership for sustainable development of business and education in the future: an introduction. In W. Strielkowski & Chigisheva, O (Eds.), Leadership for the Future Sustainable Development of Business and Education (pp. 3-8). Springer. Web.

Vlaev, I. (2018). Local choices: Rationality and the contextuality of decision-making. Brain Sciences, 8(1), 1-22. Web.

Younus, S., Al-Alusi, A., Ahmad, R., & Obaidat, M. (2019). Synergism paradigm and effective teamwork mechanism. International Journal of Innovative Technology and Exploring Engineering (IJITEE), 8(12S), 784-789.

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