How has CSR elevated Siam Cement Group (SCG) in its branding journey?

CSR has helped SCG enhance its position in the public eye, associated with the image of a brand with responsibility to the community and society.

Why do B2B businesses need to implement CSR? CSR or Corporate Social Responsibility is gradually becoming a measure of Vietnamese consumers for businesses today. Therefore, CSR is an essential obligation of any business organization, and the philosophy that SCG (Siam Cement Group) adheres to in business activities.

Setting foot in Vietnam quite early, right from 1992, but it was not until 2008 that SCG established its first construction company, Aggregate and Concrete Co., Ltd., specializing in producing ready-mixed concrete under the brand name SCG Concrete. Since then, SCG has continuously expanded to add new factories. Most recently, the Group has launched SCG Super Cement, Song Gianh, and StarCemt cement products.

Value alignment becomes a core business responsibility as social life evolves and the public gradually appreciates ethical issues, corporate actions and financial flows. Grasping the change of the times, SCG has shown the timeliness through actions and demonstrates the right values: corporate social responsibility.

SCG has adopted sufficient economy as its business model, thanks to which it can survive past and present crises. In addition, SCG has proactively managed and controlled environmental and social risks at the lowest possible level. The company has considered all issues that may affect the company’s ability to achieve sustainable development such as:

Access to raw materials

SCG weighed the risk of dependence on limited natural resources. From a sustainability point of view, resources must be used with maximum benefit and efficiency.

The cost of raw materials, fuel

The volatility of oil prices and dependence on imported energy are the reasons why the company has to consider finding alternative fuels and raw materials. SCG has focused on cost control measures and research and development of alternative fuels and feedstocks.

Climate change risks

SCG recognized the risk of global warming and other climate change, and developed a long-term strategy starting with the goal of reducing CO2 emissions. In addition, SCG has focused on energy efficiency, energy efficiency and renewable energy.

Besides, raising consumers’ awareness of environmental issues through friendly products, SCG also increases its competitiveness in the market and expands its business. SCG has developed its strategy by emphasizing customer needs and differentiating products combined with value-added products. Research and development has been carried out to support products that reduce energy consumption and have less impact on the environment. SCG eco value is awarded thanks to a research process starting from design, manufacturing, transportation, consumer use and up to the processing stages. The goal of SCG’s ecological value is to benefit society as a whole and meet consumer demand for high-quality environmentally friendly products.

SCG has created a strategy to enhance SCG’s ecological value throughout the supply chain and focuses on the research and development of High Added Products & Services (HVA) from green procurement, green manufacturing, transportation, use and waste treatment. Up to now, SCG has 87 items of products and services according to SCG’s ecological value and SCG is continuing to develop high quality and environmentally friendly products.

Environment & Society: 2 elements in TBL that directly impact SCG’s CSR activities

SCG has adopted two strategies committed to eco-friendly business, also known as Green business. The first is the Eco-Friendly Process (Green Process) which aims to reduce the environmental burden from operations as well as conserve energy and resources. The second is Environmentally Friendly Products (Green Products) by researching and developing products with fewer negative impacts than other products. SCG issued 3R guidelines for all member companies: Reduce, Reuse and Replenish.

Environment

SCG demonstrates its interest in environmental issues through programs such as:

Energy saving and greenhouse management

SCG has developed an energy efficiency plan to enhance alternative fuels through the expansion of waste and renewable energy sources.

Improving the production system can minimize energy loss in the process, so SCG installed a waste heat generator. It both helps reduce greenhouse gas emissions, save energy consumption and reduce waste.

Recently, at the “Kick-off Conference on the Development of the National Action Plan to Implement Vietnam’s Circular Economy”, Mr. Roongrote Rangsiyopash, Chairman and CEO of SCG Group said: “The Group wishes to contribute to promoting more circular economy initiatives in Vietnam. Therefore, we aim to join hands with our partners to develop together towards sustainability for the future.” The Group proposes the ESG 4 Plus model with an initial investment of up to VND 47,000 billion to achieve the goal of reducing greenhouse gas emissions by 20% by 2030.

Water Management

To prevent risks due to water shortages, SCG has issued a proactive water management plan. Use of water resources is based on the 3R concept. The first is to minimize by replacing these types of backwash sand filtration systems with self-cleaning filtration systems to reduce water usage. Second, the treated water is reused for various activities. And finally, replenish by restoring water to ensure water is returned to the environment efficiently.

Industrial waste management

SCG’s goal is Zero waste to landfills. Waste is managed within the SCG facility before being disposed of outside the facility by a third party. SCGs must ensure the disposal of all wastes complies with regulatory requirements and minimizes negative impacts on communities and the environment. The reuse of waste as fuel, alternative raw materials must be checked to ensure that it does not affect the environment and product quality.

Society

When it comes to social issues, SCG shows that it is serious about taking human rights and workers’ health seriously. The SCG allows the establishment of a labor union within the company and a Human Resources Committee to supervise employees to facilitate employee complaints as well as input and referendums.

In addition, SCG continuously manages occupational health and safety to achieve “Injury & Illness” for both employees and contractors. SCG has established the SCG Safety Framework in line with the nature of its business and international standards. The SCG Sustainability Committee adopts SCG’s Safety Performance Assessment Program (SPAP) for all subsidiaries. SCG has developed a contractor safety management system, performing audits and certification in accordance with the Contractor Safety Certification System (SCS).

Above all, SCG’s social responsibility is most evident through the SCG Foundation. The establishment of the SCG Foundation has the objective of creating social responsibility and implementing the Belief in the Value of the Individual in accordance with the SCG philosophy. The Foundation has supported scholarships to develop special talents in sports, arts and music for students, and supports students who have talent but have not found opportunities and do not have the financial means.

Most recently, in 2022, SCG celebrated the 14th International Children’s Day at Ba Ria – Vung Tau School for Raising Children with Disabilities. The program is one of the side events of the “Vietnam Circular Economic Forum 2022” organized by SCG in collaboration with the Ministry of Natural Resources and Environment to enhance stakeholder engagement and promote sustainable Vietnam through expert sharing and initiatives. The program also demonstrates SCG’s commitment to pursuing its ESG (Environmental, Social and Governance) strategy.

With its CSR efforts over the years, SCG has initiated a public survey on SCG’s attitude towards corporate image and satisfaction with its business. The last survey pointed to a better corporate image in terms of reliability, financial security, innovative leadership, and human resource management. Obviously, corporate social responsibility has helped SCG enhance its brand value and affirm its leading position in sustainable development after more than 1 century of establishment and development in the ASEAN market in general and 14 years of operation in Vietnam market in particular. SCG was the first company in Thailand to achieve a world ranking in the Dow Jones Sustainability Index (DJSI) assessed by RobecoSAM Sustainable Asset Management. And they have been in this global ranking for 14 consecutive years since 2004.

Trade and the Environment are a dilemma for developing countries. Most developed countries want to force developing countries to care about the environment. On the other hand, developed countries hold most of the environmental scientific information and research that developing countries are forced to buy solutions to apply to their production so that they can meet all requirements. So if developing countries want to break out of this cycle, they must create value from their own internal organizations. Supporting research and development from their internal human resources is a sustainable advantage way to gain knowledge and innovation. From there, new companies can minimize trade barriers and reduce costs due to external innovation.

Social responsibility is not only implemented in big companies, no matter how you are doing business and what model you are, social responsibility is something to consider in brand building and development strategies, especially in the period when society has many fluctuations after covid. Please contact phung.metta@metta.com.vn to learn more about leading branding solutions in Vietnam.