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Tesco Lotus shifts focus to 'create share value' concept

Dec 02. 2014
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By Somluck Srimalee
The Nation

Giant gives back to society in line with its business value; turns attention to education, health, environment, SMEs
Education, health, business training, the reduction of plastic-bag usage, and waste management are the themes of the “create share value” (CSV) concept of the Tesco Lotus chain in Thailand.
Charkrit Derekwattanachai, head of public affairs at Ek-Chai Distribution System, which operates the nationwide chain of supercentres and smaller stores, said the primary focus of corporate social responsibility (CSR) was on doing something for society, whereas social responsibility should also involve giving something back in terms of a corporate’s actual business value. 
This means that a large operator like Tesco Lotus has to create benefit for society and share its economic value with society, as a result of which the company is now using the CSV concept rather than purely concentrating on CSR, he explained. 
“We will combine both the economic and social benefits together,” he said.
For example, for the theme of education, the company has joined with the Office of the Higher Education Commission and the community around each Tesco Lotus branch, of which there are now almost 1,800 of various sizes around the country, to provide scholarships for local children. 
Boosting self-sufficiency
The group also provides health education and other health-related services in all of the communities around its branches, so that locals have a better understanding of what they can do to take care of their health. 
Each branch also runs a free aerobics dance session every evening that anyone in the community can take part in.
Another major CSV theme for the company is to reduce the use of non-biodegradable plastic shopping bags, a matter that relates directly to the business and the environment, said Charkrit. 
Under the campaign, which kicked off in 2011, shoppers are encouraged to use cotton bags instead of plastic ones. 
Apart from reducing the damaging effects of plastic waste on the environment, the move also lowers carbon-dioxide emission from the production of plastic bags, as well as cutting the company’s business costs related to the provision of the bags for customers. 
“Reducing our costs is an indirect benefit from this campaign. The main idea of the campaign is to raise awareness about concern for the environment in the long term,” he said.
When the campaign began in earnest in 2012, around 1 million fewer plastic bags worth about Bt300,000 were used by Tesco Lotus shoppers that year. 
Last year, the company saw a much greater reduction in its plastic-bag usage, with 14 million fewer bags worth about Bt4.2 million being used, while in the first 10 months of this year, the reduction was as high as some 20 million bags worth Bt6 million. 
At the start of the year, the company targeted a reduction of 21 million plastic bags for the full year, he added.
When our customers are concerned about the environment, reduced plastic-bag usage cuts the amount of plastic waste and CO2 emission, and also results in energy saving, he explained.
Training for supply-chain SMEs   
The company is also determined to look after the interests of its suppliers, more than 1,600 of which are small and medium-sized enterprises.
It is seeking to develop these SMEs’ business skills and standards to complete with other SMEs from around the region when the Asean Economic Community comes into effect next year by providing them with training. 
In this regard, it has tied up with Chulalongkorn University’s Sasin Graduate Institute of Business Administration to set up five-day training courses for SMEs that are members of the Tesco Lotus supply chain, said Charkrit. 
This forms part of its efforts to create more value for its partners by enabling them to develop their business for sustainable growth in the long term, he added. 
Finally, there is the company’s “Gifts to Share Happiness” campaign, which runs until January 7.
Under the campaign, Tesco Lotus is inviting customers to make merit over the New Year period by sharing dried food and rice with 166 charitable foundations for children from donation points in its stores. 
Cash donations can be made through any Tesco Lotus cashier. Simply purchasing a New Year gift basket from any Tesco Lotus store around the country enables customers to improve nutrition for needy children nationwide. 
Latest information from the Health Department indicates that around 10 per cent of Thai children are underweight, whether in remote upcountry locations or urban slums, and the core reason is inadequate nutrition, said the Ek-Chai public affairs chief. 
As a result, Tesco Lotus has set up the “Gifts to Share Happiness” project to help poor children by sharing food through charitable foundations during the New Year’s holiday, with an overall target of providing 200,000 meals. 
Tesco Lotus customers can also participate by donating cash to the “Breakfast Fund” of the World Vision Foundation, which will supply breakfast to poor children all around the country. Donations can be made at the checkout in any format of Tesco Lotus store around the country. 
As for customers buying New Year’s gift baskets, Tesco Lotus will likewise donate a portion of all such sales to the World Vision Foundation, which will also translate into nutritious breakfasts for needy children.
“We are getting good nutrition to young people by using our big network of almost 1,800 Tesco Lotus stores and our large customer base of over 12 million customers per week. This benefits society by giving customers the opportunity to participate and add to what we have started, enabling us to bring happiness and good food to even more underprivileged young people,” said Charkrit.
“Here at Tesco Lotus, we hope that this sharing to give Thai kids better health and opportunities to learn will also encourage Thais to cooperate and share more, to sustainably return happiness to Thailand,” he added.
All aspects of the CSV campaign use all of the group’s facilities to support the activities, with all members of staff urged to participate, too. 
This will inspire its employees and the communities around its branches to benefit from Tesco Lotus’s business, he said.

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