More than 56,200 enterprises were forced to stop operation in the first six months, up 10 percent year-on-year.(Photo tuoitre.vn) Hanoi (VNS/VNA) - TheCOVID-19 pandemic is not only a big test for enterprise resilience but also anopportunity for businesses to re-evaluate their long-term strategy and urgencyof sustainable development.
Industry insiders and expertsshared their opinions at a dialogue with the press on the topic “Sustainablebusiness development, lessons learned from the COVID-19 pandemic”, held by the VietnamBusiness Council for Sustainable Development (VBCSD) on July 15 in Hanoi.
Experts said the pandemic hasrevealed the shortcomings in governance of Vietnamese enterprises, includingrisk management, crisis management and adaptation. This is considered one ofthe main reasons for the collapse of many local enterprises since the outbreakof the disease.
According to data from theGeneral Statistics Office (GSO), more than 56,200 enterprises were forced tostop operation in the first six months, up 10 percent year-on-year, of whichthe number of companies registering to temporarily cease operations rose 38.2 percent.
Pham Hoang Hai, head of VBCSD’sSecretariat, said applying corporate sustainability index (CSI) will helpbusinesses improve competitiveness, increase resilience and quickly recover inall scenarios.
“The set of corporatesustainability index has equipped enterprises with a tool to be able to copewith the economic impacts,” Hai said.
He highlighted the correlationbetween the implementation of the sustainable governance practices, informationtransparency and social and environmental responsibility with the business resultsof enterprises.
“Corporate sustainabilitypractitioners always achieve better business results and higher labourproductivity.”
Pham Thi Thanh Xuan,representative of the Vietnam Leather, Footwear and Handbag Association, saidthis index is an effective tool to help companies detect weaknesses andshortcomings during operation, thereby contributing to promoting sustainabledevelopment.
The COVID-19 pandemic hadfar-reaching effects on Vietnam's economy, including the leather industry, Xuansaid, adding in the first six months, the industry’s exports droppedremarkably, especially by 3.6 percent in May alone. Enterprises have had toreduce labour and employment.
"The association has beenclosely accompanying enterprises to overcome difficulties and limit impacts onworkers' jobs," she said.
Representative of NestleVietnam Co. Ltd., Le Thi Hoai Thuong said the COVID-19 pandemic had a profoundimpact on the production and development of the business and the SCI is ameasure which helps Nestle know what the company needed to do to overcomedifficulties.
“At the beginning of thepandemic, based on internal assessments, the company immediately devised astrategy to help overcome the storm. That campaign gives priority to the healthof our employees,” she said.
Bui Thi Thu Trang,representative of Deloitte Vietnam, said many businesses do not have adequateunderstanding about corporate governance when they care more about how toensure the growth and revenue for businesses.
To achieve good governance,companies must ensure three factors including capital management, crisismanagement and risk management, but domestic enterprises have yet to payadequate attention to the two latter elements.
In the current context,especially after the COVID-19 pandemic, Trang suggested businesses proactivelydigitalise their operations, as this not only helps improve the governanceefficiency but also cushion businesses from external shocks.
Nguyen Quang Vinh, Secretary General ofthe Vietnam Chamber of Commerce and Industry (VCCI), highlighted that applyingthe sustainability index will help Vietnamese businesses attract investors moreeffectively, especially as the country is deeply integrating into the worldeconomy.
According to the UN GlobalCompact Progress Report 2019, businesses are increasingly committed to greatertransparency in disclosing information about sustainable development activities.
From 2000 to date, nearly65,000 sustainability reports have been delivered. Currently, more than 30countries have adopted a mandatory sustainability reporting law.
According to Hai, the CSI Indexhas been updated with many new points to suit the requirements from theimportant free trade agreements that Vietnam has recently signed, as well asimportant changes in labour and environmental management policies, especiallythe 17 sustainable development goals specified in the national action planfor the implementation of the 2030 Agenda for Sustainable Development./.
VNA
