Emirates CSR [Corporate Social Responsibility]

Introduction

By the end of the 1970s, the most significant issue that came to light was caring for the environment and society. Although, there were volunteers within the society, yet a favorable response from the business community, in this regard, started coming in at the advent of the 1990s. Big business owners, who were concerned about the social abuses and demands of labor unions, started the concept of Corporate Social Responsibility (CSR). They constructed abodes and medical facilities to improve the living standards of their employees. This gesture paid back. The employees were motivated and there was an increase in the worker turnover as well as the profitability of the corporations.

In this assignment, we shall discuss the new reporting format of corporate responsibilities towards society. This format will enable a layman to understand the efforts being made by corporations around the world for the betterment of society. It has been observed that in recent years, there has been an unprejudiced increase in the number of companies that are reporting in public on a range of features of their environmental and social performance.

In terms of power and influence, you will forget about the church and the politics because there is no institution in society that is as powerful as a business. The business of business should not be about money, it should be about responsibility. It should be about public good and not private greed (Roddick, 2000). A wide-ranging understanding of environmental economics is required, where ecological variables and issues are essential and are part of a multidimensional viewpoint. The analysis must incorporate the social-cultural, should be health-related and consider the monetary or financial aspects as well.

Systematic accountability processes should involve stakeholders in the strategies, policies, and programs and also in related indicators, aims and the communication systems. This will improve the overall performance of the organization.

Independent third parties verify the environmental, social and sustainability reports. Apparently, there has been tremendous growth in proportion. A credibility gap is being felt due to the lack of confidence in the data and sincerity of the reporting organizations. KPMG’s figures show that in 2002, 29% of GFT250 report issuers got their reports verified (1999: 19%). Likewise, third-party verification was included in 27% of the top 100 companies, as compared to 18% in 1999 (CSR Network, 2003).

A proper analysis of the sustainability reports reveals that the best sustainability reports include some assurance statement as well (SustainAbility, 2002). According to KPMG, the increased presence of verification is because of the demand for trustworthy and correct information from the management in order to maintain the company’s social and environmental risks and the investors and stakeholders who want assurance that the report is actual and represents a true picture (KPMG, 2002).

CSR is an important mechanism of accountability. During the 1990s, there were not many companies that published their CSR. Now that the company doors are open for stakeholders, people have started taking interest in the CSRs of companies. The chart in Appendix 1 depicts the people’s perception of corporate social responsibility. The chart suggests that people also are now becoming aware of CSR.

During the last few years, CSR has come to be a very frequently heard term in offices, communities and the media. CSR reporting is a gateway from where companies get in touch with the public and make them aware of what they are doing for their welfare and for protection of the environment. Investors and stakeholders view these reports to have a stake in the company. Companies, in turn, get to know any negative remarks from the public or the investors and stakeholders. This helps them in improving their profile for betterment.

Emirates CSR Activities

The Emirates Group is a gigantic establishment, with stakes in various businesses such as “aviation, travel, tourism and leisure industries” (Emirates, 2013c, p. 1). The group’s turnover is the astounding US $18.4 billion. “The group comprises mainly of Dnata, one of the largest air services provider globally and Emirates airline, the group’s rapidly expanding and award-winning international carrier” (The Emirates Group, 2013c, p. 1). Other sister concerns of the group are: Emirates Sky Cargo – caters to 100 destinations worldwide, Emirates Airport Services (EKAS), Emirates Wolgan Valley, Skywards, Emirates Holidays, Arabian Adventures, Congress Solutions international, Mercator, Emirates Engineering, and Alpha Flight Group Limited.

The airline caters to several destinations all over the world and has a massive fleet of young aircraft having the latest technology. There are not less than 50000 employees working for the group, throughout the world. Emirates group is considered to be the largest employer in the Gulf. The group strictly follows corporate social responsibility principles. It considers its employees to be a crucial part of its business because they help in the growth of the organization. The employees of Emirates group enjoy various benefits that even include profit sharing. The organization also has various development programs for its employees so that they can improve and achieve their professional goals.

It has become a tradition at Emirates to invest in new and better (complying with the ecological standards) aircraft, thus making it one of the most ecologically competent airlines the world over. The Emirates group participates in the conservation of the environment by promoting various social and environmental projects such as the rehabilitation of the UAE desert.

The Emirates Group gives great importance to the business ethics and responsibility towards the society; as both are core factors in an organization’s performance and success. The dedication and contribution of each and every staff member are considered to contribute to the organization’s sustenance in the global competitive markets. The group considers its employees as its biggest asset and cannot imagine excelling without their participation. Due to such extra benefits, the Emirates Group is one of the choicest employers where candidates want to get hired.

The Emirates Group also practices diversity management and as such, there are people who live away from their families at various locations. The Emirates Group considers it as its ethical responsibility and duty to take care of such people so that they don’t feel isolated.

It’s not the group is concerned only about the welfare of its employees; it doesn’t neglect its “fundamental economic role”. Simultaneous to caring for its employees, the group also reports having considered the stakeholders’ interest at the same level. Irrespective of the “fluctuating fuel prices” and unlike its competitors, Emirates Group has always shown profits, except one year.

Likewise, every other organization, the focus of the Emirates Group is also on making more profits but in this process, it does not forget its concern pertaining to the corporate social responsibility. Even though Emirates is considered to be the torch-bearer in bringing about new innovations in the aviation industry, the organization ensures that during the process of innovation, minimal resources are put into use and such resources should emit minimal waste, consequently amounting to less pollution. The emissions from Emirates’ aircrafts is “30 per cent lower than the ICAO global fleet average, thanks to a young fleet of aircraft averaging 5 years and an average fuel burn of less than four litres for every 100 passenger kilometres – better than most modern small cars” (Emirates, 2013a, p. 1).

The Emirates Group is proud to have the most sophisticated aircraft in its ecologically efficient fleet. The company has to invest billions of dollars in the venture.

The group is also very much concerned about the conservation of the ground ecological balance. As mentioned above, the group has undertaken the ‘Dubai Desert Conservation Reserve’ project. The project “is dedicated to preserving the natural and cultural heritage of the area” (The Emirates Group, 2013a, p. 1). In addition to the national projects, the group is also engaged in promoting green projects around the globe; example: the ‘Wolgan Valley Resort & Spa, Australia.

.another example the Emirates Group’s adherence to the corporate social responsibility is ‘The Emirates Friendship Hospital Ship’. “The Emirates Friendship Hospital Ship provides vital medical assistance to more than two million people living in communities isolated by the annual monsoon flooding in the most deprived region of Bangladesh” (The Emirates Group, 2013b, p. 1).

“Emirates now runs a couple of CSR programs in the form of coaching clinics and the racquet return scheme and also fan engagement activities through the Emirates Fastest Serve and in stadia promotions” (Emirates, 2013b, p. 1).

Some of the main social projects, in adherence to the guidelines of the corporate social responsibility that the group is handling or has handled, are as under:

• In 2005, the group contributed half of the school renovation cost at Nairobi. The school has 500 students and despite the dire state of the school building, the students secured appreciable marks and place in the merit lists.
• A group of young students from Dhaka, Bangladesh, were sponsored to visit Germany on a Project English curriculum program.
• The group also funded a face-lift of a Sri Lankan hospital. “A new floor, new beds, new medical equipment, and even new window blinds, have not only given the unit a whole new look but have resulted in the provision of better medical care to seriously sick children admitted there” (Emirates, 2009, p. 6).

Excerpts from another heart-touching message from Sr. Margaret Joseph, the caretaker of St. Leonard’s Home, a children’s shelter home in Sri Lanka: “Due to the war in our country, the number of neglected children coming to this home has increased. Your help has been such a relief and we have been able to feed, clothe and educate the children and give them hope for the future” (Emirates, 2009, p. 6).

In addition to directly being involved in charity programs, the group is also involved in providing indirect relief through various other charity organizations such as:

• The Emirates Friendship Hospital Boat, Bangladesh;
• Emirates-CHES Home for abandoned HIV+ children in, Chennai, India;
• Emirates-AIM for Seva Student Home for Girls, Tamil Nadu, India;
• The Dhaka Project, Bangladesh with a new international curriculum school;
• The Lady Ridgeway Hospital for Children, Colombo, Sri Lanka;
• The Kidane Mehret Orphanage, Addis Ababa;
• Beyond the Orphanage, Addis Ababa;
• The Purkal Youth Development Society, India;
• St Leonard’s Orphanage, Gampola, Sri Lanka;
• Society for Health Education (SHE), Maldives;
• Kurnool School food program (India);
• Sao Paulo Food and Education program;
• Al Noor School in Dubai – annual leave tickets sponsored for teachers (Emirates Airline Foundation, 2013).

In view of all the facts and figures discussed above, it is an undoubted fact that the Emirates Group is very much concerned about its social corporate responsibility and does everything possible to fulfill it.

ADNOC CSR

The Abu Dhabi National Oil Company (ADNOC) is one of the major oil companies in the world. The company was set up in 1971 in Abu Dhabi, UAE. The company proposed to have a stake in various sectors of the oil and gas industry. Today, the company produces “over 2.7 million barrels of oil a day” (ADNOC, 2013, p. 1). The companies that form the ADNOC group include ADCO, GASCO, Alison Gas, TAKREER, Borouge, FERTIL, ADNOC Distribution, ELIXIER, ADMA – OPCO, ZADCO, and ADGAS. While striving for sustenance in the competitive market, the company maintains an equilibrium between people’s requirements and the earth’s valuable resources. The company believes that their “track record in occupational health and safety, and protection of the environment, sets the standards for the rest of the Arabian Gulf” (ADNOC, 2013, p. 1).

ADNOC is very well aware of the importance of corporate social responsibility. The company performs its responsibility for CSR in various manners. Let us first talk about the stakeholders. The company conducts surveys that target the consumers; Feedbacks are invited and follow-ups are made. All the company’s products have relevant product specifications and material safety data sheets. During the tender processes, the company adopts a policy that requires the suppliers to have Health, Safety, and Environment (HSE) standards.

The company is also concerned about its employees and has schemes that conduct employee satisfaction surveys and invite suggestions. The employees are required to attend regular training programs that increase their knowledge and brighten their professional future. The company also practices annual employee appraisals that enable better employees to get promoted.

The company holds a meeting of all shareholders on an annual basis; the annual sustainability report is presented before the shareholders during such meetings. The shareholders are also allowed to have tours of the manufacturing facilities of ADNOC. The shareholders even have the right to access ADNOC’s company information. Government officials are also invited at frequent intervals to visit the manufacturing facilities and strategic planning forums are conducted.

ADNOC promotes educational and public establishments all around Abu Dhabi and conducts career and recruitment fairs for the benefit of the educated youth. The company encourages employee volunteerism and participation in local welfare programs to a great extent. The company also brings out monthly newsletters that include important details about ADNOC. The company sponsors community programs in and around Abu Dhabi; some of such events are “International Day, National Environment Day, Liwa Date Festival, and Dhafra Camel Festival” (ADNOC, 2011, p. 20).

“ADNOC’s HSE objectives regarding air emissions include striving towards the ultimate elimination of hydrocarbon flaring, reducing emissions, improving energy efficiency, promoting renewable energy, eliminating continuous venting of hydrocarbons and achieving zero losses of halons and chlorofluorocarbons (CFCs), whilst gradually phasing them out” (ADNOC, 2011, p. 23). In complying with its HSE aims, the company has an ‘Air Quality Monitoring System (AQMS)’ that was initially set up in the year 2007. The system was set up at a cost of UAE Dirham 10 million. It has eight observation stations out of which seven are fixed and one is mobile. This system monitors and controls the quality of the air emanated from the ADNOC facilities.

As years pass by, the demand of energy by ADNOC facilities increases due to the expansion programs carried out by the company; expansion is required due to the increasing demand of oil and allied products throughout the globe). Increase use of energy has a negative impact on the surrounding environment, and moreover, it increases the cost of production. To avoid such problems, the company has introduced pioneer energy efficient measures in all of its manufacturing facilities.

The stakeholders of ADNOC presented before the company a proposal that suggested a target of increasing its manufacturing facilities’ efficiency in consuming energy by 25 percent. The target year for such an increase was suggested to be 2055. In arriving at the percentage of increase the energy consumption efficiency and the target year, a study was conducted by high-level scholars. Even though ADNOC has not yet formalized the proposal, it has started adopting measures that increase energy efficiency. ADNOC also tackles other environment problems with great sensibility and responsibility; environmental problems such as pollution from transportation, materials, waste, spills, water, and effluent, and biodiversity).

The company takes all the necessary precautions about the health and safety of its workers and other employees. “ADNOC places the safety of our employees and contractors first across our lines of business, and we strive to build a workplace culture of zero tolerance to high risk conducts and incidents” (ADNOC, 2011, p. 41). Despite the company taking all the necessary precautions and issuing safety guidelines to all its employees and contractors, it was very unfortunate that the there was an increase of 9.5% – in 2011, as compared to 2010 – in road accidents that involved ADNOC’s employees and an increase of 100% – in 2011, as compared to 2010 – that involved ADNOC’s contractors.

Further, all the employees of ADNOC are given health insurance coverage. The employees can avail medical facilities at certain healthcare institutions and even in-house medical facilities of ADNOC. ADNOC “operates two medical centers, 18 clinics and several pharmacies across Abu Dhabi and the Western Region” (ADNOC, 2011, p. 50).

ADNOC observes diversity management in all its departments. According to the company’s sustainability report of 2011, the company had a workforce of 68,000, out of which 31,000 were employees and 37,000 were contractors. The diversity in ADNOC’s employees can be judged by the fact that in the year 2011, 38 percent were Asian expatriates, 23 percent were Arab expatriates, 33 percent were Emirati nationals, 4 percent were Western expatriates, and 2 percent were others. Due to the increased educational levels and percentage of educated women, more and more women have approached ADNOC for employment. ADNOC follows the policy of having equal opportunities for women. In the year 2011, women employees comprised 8.5 percent of the total employees. As compared to 2010, there was an increase of 2.5 percent. ADNOC is also a staunch follower of the UAE government’s policy of creating more employment for the local people; Emiratisation.

ADNOC is also very much concerned about human rights and ensures that none of its contractors or suppliers violates any human rights. Clauses pertaining to this aspect are included in the contractual agreements that the contractors and suppliers have to sign in acceptance.

Considering the aforementioned points, it is evident the ADNOC strives hard to comply with the regulations and requirements of corporate social responsibility. Regular audits are conducted by the Audit and Assurance Division (A&AD) to ascertain the compliance of CSR.

References

ADNOC. (2011). Abu Dhabi National Oil Company: 2011 Sustainability Report. Web.

ADNOC. (2013). Products & Services. Web.

CSR Network. (2003). Material World: The 2003 Benchmark Survey of Global Reporting. UK: CSR Network Limited. Web.

Emirates. (2009). Sri Lanka hospital benefits from face-lift. Web.

Emirates. (2013a). Welcome from our Chairman. Web.

Emirates. (2013b). Rogers Cup. Web.

Emirates. (2013c). Our Company. Web.

Emirates Airline Foundation. (2013). The Emirates Airline Foundation. Web.

KPMG. (2002). International Survey of Corporate Sustainability Reporting. The Netherlands: KPMG Global Sustainability Services. Web.

The Emirates Group. (2013a). Responsibility. Web.

The Emirates Group. (2013b). The Emirates Friendship Hospital Ship. Web.

The Emirates Group. (2013c). The Emirates Group Companies. Web.

Roddick, A. (2000). Business as Unusual, London: Harper Collins Publishers. Web.

SustainAbility. (2002). Trust Us: The Global Reporters 2002 Survey of Corporate Sustainability Reporting. London: SustainAbility. Web.

Appendix 1