As a result of rapidly growing public demand for transparency, companies in China are beginning to develop CSR initiatives and disclose Environmental, Social and Governance related information. This represents significant progress, as in the past, companies would tend to cover up negative information or incidents rather than take responsibility for them. Sometimes however, the level of disclosure is just cosmetic communication. In order to build real trust, businesses should communicate based on real transparency.

On 22nd November this year, an oil pipeline owned by China's largest oil refiner, China Petrochemical Corporation (Sinopec), caught fire and exploded while being repaired. At least 55 people were killed in the incident and many more were injured.

After the blasts, Sinopec promptly established a new section on its company webpage to provide information on the incident, and has also been communicating on the incident through its Weibo account (Weibo is a micro-blogging platform in China). Most of the information provided on these two platforms is Sinopec’s public apology and claims that they are working on the site to minimize the negative impact, but little in-depth information has been disclosed about post-disaster community arrangements or further plans for improving safety in future.

According to a report by China Daily, residents of communities around the affected area are concerned for their safety and are demanding relocation, rather than renovation of their damaged apartments. However, little information was found on Sinopec’s communication platforms regarding any form of community engagement. If the company is taking action to engage, it is obviously not enough to restore the residents’ trust in the company.

In one of the news releases published on the Sinopec website, the company has promised to enhance the safety management practices and safety performance. Nevertheless, without transparency and communication on the causes for this incident, or a concrete plan and timeline for further action to improve safety, it is difficult for the public to track the company’s progress and promises may be perceived as empty words. Thus is becomes difficult for the company to regain public trust.

In 2011, China National Offshore Oil Corporation (CNOOC) also responded quickly after an oil spill -promptly setting up a webpage to publically communicate the process of handling the spill, and also making promises to enhance their environmental management and performance. Two years later, the webpage is no longer available and no updates can be found in the company’s CSR report. All the information related to the incident seems to have disappeared without a trace from CNOOC’s communications as if the incident never happened. It is not clear if the company has made progress or whether it has fulfilled its promises, as the company is not being transparent in its communication. Equally, the company will find it difficult to regain the trust of their stakeholders if they cannot see the improvements.

Taking the initiative to communicate on ESG issues has become a common practice for large enterprises in recent years, especially after high impact incidents or accidents, but in the communication process, real transparency needs to be delivered to gain trust from stakeholders.