Foreign companies in China have become increasingly vulnerable to this type of criticism. While many multinationals are admired for high quality standards, expectations of them have soared to sometimes unreasonable levels in recent years. As one senior public relations manager put it to EuroBiz last year, the honeymoon with Chinese consumers has ended, and large companies are now fair game for negative attention.

There are three main reasons for the recent rise in expectations, says Alan VanderMolen of public relations firm Edelman: government activism, the advent of non-governmental organisations and increased consumer sophistication as a result of higher living standards.

One form this has taken in China is that more people expect companies to have a sense of duty to society. A recent study by Edelman found that the number of people polled who thought being concerned about or active in the community is part of being a "responsible corporation" rose from 35 percent in 2006 to 51 percent in 2007. According to the survey, only 13 percent of respondents say they trust companies to "do what is right", compared with 19 percent in 2006 and 21 percent in 2005. "The recent product safety issues - which have been covered very well in the media - are especially negative, which leads to increased scepticism," says VanderMolen.

This was the subject of a European Chamber event recently held in Shanghai, titled "Corporate Scepticism about Responsibility". At the seminar, the point was made that many now view corporate social responsibility (CSR) campaigns as stunts designed to cover up companies' other blemishes. Doubt doesn't just apply to consumers - it can plague employees and senior management as well.

Addressing the sceptics

Some scepticism is deserved, says David Zhao of public relations firm Hill & Knowlton, but it depends on the overall strategy. There are three chief reasons companies could be dubious about CSR: It's too expensive, it is not seen as contributing to the bottom line and providing for the common good should be the government's job, not a profit-maximising company's.

What companies that view CSR as equivalent to philanthropy don't realise, says Zhao, is that the right CSR program can bring tangible benefits to a company's bottom line. He recently worked with a liquor company to launch a nationwide responsible drinking campaign. The idea in that instance was "[to create] a healthy environment …so that in the future, the government doesn't come in and say, ‘No more drinks after 10 o'clock'. That would be devastating for business."

A number of laws, including China's company law, refer broadly to concepts like "social morality", "business morality" and "bear[ing] social responsibilities". Many companies, paying lip service to the requirements implied, do what they consider the bare minimum, doubting the benefits of expending additional resources. To spare employees' time and energy many companies find a worthy charity and donate money to it.

Companies that simply cut a cheque forfeit the extra rewards that more involved efforts can bring, says Zhao. Carine Seror of the World Wildlife Fund for Nature (WWF) says her organisation receives donations from many Chinese and multinational companies, but would like to bring them along to becoming more active. "It's part of a process to make companies believe they can make a positive impact on the environment," she says.

Developing partnerships with any of the growing number of non-governmental, non-profit organizations in China can help companies better interact with their stakeholders. Seror notes two ways in which the WWF can help businesses. "When a company like HSBC works on its lending policy with us, it's part of their core business," she says. "It's not only helping the community - it also has strategic benefits."

Zhao agrees, saying that in pursuing an environmental project, a company must look for an issue associated with the environment where it has a role it can play better than other businesses could.

Getting everyone on board

The most effective approach to CSR stress the importance of engaging a company's various stakeholders, a group which, depending on the company, can include the government, customers, the local community, company headquarters, employees and news media.

Getting employees to go along with CSR projects may be getting easier in China. The generation of employees entering the workforce is actually demanding to work for companies that enable them to take part in CSR projects and help develop CSR strategies. According to a report on Chinese students by AIESEC, an international student-run educational foundation, CSR could be a "differentiating factor" for students to apply for a job or accept an offer, with all else being equal.

Amway, the direct-sales company, is currently trying to satisfy this demand through its "One by One" community service campaign. One component of the program sponsors postgraduate students teaching in poor areas. This is not only for the good of the students - it also helps Amway establish relationships with potential employees who are both conscientious and have penetrated remote areas where its products can be sold.

Chinese media, often a source of intense scrutiny of foreign companies, can be more difficult for businesses to get on their side. Negative news reports involving corporations - often involving issues like labour conditions - have often spiralled out of control after being picked up by frequent users of the country's hyperactive internet message boards and weblogs. The reverse situation - internet users starting a complaint that catches on and draws media attention - is happening more and more. "Internet buzz brings a level of accountability to companies that never was there before," says Sam Flemming of CIC Data, which monitors chatter about companies on Chinese blogs and online forums.

These factors underscore the important role that communication plays in a CSR strategy. "If a company is sponsoring a conservation [project], it is looking at communication opportunities," says Seror. Visibility has made it easier for her organization to find corporate partners. "You can hardly open the newspaper today without reading something about the environment."

Zhao stresses the importance of the role of PR in a company's CSR project: "A lot of scepticism is rooted in a lack of communication. That's why you need to have a communication platform to have a continuous dialogue with stakeholders. I would argue now that you cannot afford //not// to talk about your CSR programs."

Many PR companies are offering start-to-finish CSR consulting and support services that systematically organise, implement and publicise community outreach strategies. But ultimately, the best CSR programs are not outsourced; they are an institutionalised part of corporate structure, are consistent with the company's core values and involve employees at all levels (many companies set up voluntary "community outreach committees" to do this), including top management - not just an appointed CSR manager.

Taking the long view

Though CSR's financial benefits cannot be easily measured in the short term, it is appearing more and more essential for creating goodwill from the public and a sustainable environment in which to do business. This is not to say that companies should not have a clear idea of what they want to achieve - on the contrary, internal measurements of success for a CSR program are essential, and should be coordinated as much as possible with other CSR programs they carry out elsewhere in the world.

Goal-directed CSR - rather than giving for its own sake - seems to be catching on. As for Chinese companies, most "still look at [CSR initiatives] from a corporate reputation point of view, rather than from a business, industry, or society point of view," says Zhao, but this is changing. Today, outward-looking Chinese companies are turning to foreign businesses for guidance, proving that this strategy truly represents the future direction of CSR projects.