MINISTRY OF EDUCATION AND TRAINING
THUONG MAI UNIVERSITY
-------------------------

DINH THI HUONG

CORPORATE SOCIAL RESPONSIBILITIES
TOWARDS EMPLOYEES OF VIETNAM GARMENT
COMPANIES

Major

: Commercial business

Code

: 62.34.01.21

DOCTORAL DISSERTATION SUMMARY

Hanoi, 2019


The PhD dissertation is completed at Thuong Mai University
Supervisors: 1. Assoc. Prof. Dr. Nguyen Thi Minh Nhan
2. Assoc. Prof. Dr. Mai Thanh Lan

Examiner 1:………………………………...................…………………
…………………………………………...................……….
Examiner 2:…………………...................………………………………
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process. In addition, barriers and challenges of garment enterprises are subjective and
objective factors for more complicated CSR for implementation.
On basis of the mentioned-above analysis, the author realizes that the research on
“CSR towards employees in garment companies” is urgent.
2. Research objectives and tasks
Objectives: To propose major scientific and practical solutions to enhance CSR
towards employees of Vietnam garment enterprises.
Research tasks: (i) Develop a theoretical framework on the content of CSR towards
employees, the process of implementing CSR, some subjective factors and objective
conditions having impact on CSR towards employees of enterprises; (ii) Study
experiences of foreign garment enterprises and find out lessons learned for Vietnam
garment enterprises; (iii) Analyze and assess the status of the content and
implementation of CSR towards employees of Vietnam garment enterprises; (iv)
Analyze how a number of subjective factors can impact the process of implementing
CSR towards employees of Vietnamese garment enterprises; (v) Analyze and identify
objective conditions affecting CSR towards employees of Vietnamese garment


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enterprises; (vi) Research orientations and opinions on CSR towards employees to
propose solutions and recommendations to enhance CSR towards employees of
Vietnamese garment enterprises from now to 2025 with a vision to 2030.
3. Research questions
For the foregoing research objectives and tasks, the dissertation has to answer the
following questions: (1) What is the content and process of implementing CSR towards
employees of Vietnam garment enterprises? (2) How can subjective factors affect the
process of implementing CSR towards employees and how can objective conditions
have impact on CSR towards employees of Vietnam garment enterprises ? (3) What
should we do to enhance CSR towards employees of Vietnam garment enterprises as

towards employees, code of conduct related to implementation of CSR towards
employees, other stakeholders affecting CSR.
With regard to practical aspects, the dissertation analyzes and evaluates the
situation in a systematic and objective manner and comes to a conclusion that compared
to SMEs, large-scale garment enterprises stand out in terms of implementing clauses
ensuring rights of employees in labor contracts, carrying out advanced health care
programs, social insurance, health insurance for employees. SMEs still have limitations in
ensuring rights of employees, ensuring working hours in line with their commitments,
strictly complying with regulations on rewards for extra working hours in weekdays...
Large enterprises have initially been interested in the process of implementing CSR
towards employees from making plan on implementation, implementation and evaluation
of implementation of CSR towards employees. However, they still have difficulties CSR
implementation accounting, CSR communication and communication report making.
SMEs do not know the whole process of implementing CSR towards employees. The
dissertation also finds out other stakeholders influencing the most CSR towards
employees. The use of exploratory factor EFA, CFA, SEM and Boostrap tests result: CSR
= 0.271*LD + 0.193*HD + 0.180*TC + 0.158*Size and Leadership variable has the
strongest impact. The dissertation proposes some solutions: to enhance the content of the
implementation of CSR towards employees; to promote the implementation of CSR
towards employees; to improve subjective objectivefactors to create favorable conditions
for CSR towards employees of garment enterprises.
5. The dissertation structure
The dissertation has the following chapters:
Chapter 1: Research overview and methodology
Chapter 2: Theoretical and practical framework of CSR towards employees of enterprises
Chapter 3: Situation of CSR towards employees of Vietnam garment enterprises
Chapter 4: Solutions to strengthening CSR towards employees of Vietnam garment enterprises.
CHAPTER 1
RESEARCH OVERVIEW AND RESEARCH METHODOLOGY
1.1. Overview of researches

the research gap is to establish a theoretical framework on the process of implementing
CSR towards employees from making plan on implementation.
Thirdly, researches identify some subjective factors: business leadership, strategic
planning, corporate finance, corporate culture, enterprise size and objective conditions
such as the situation of economic development and international economic integration,
state management, CoC, other stakeholders affecting the implementation of CSR
towards employees... Not many researches systematically and comprehensively focus on
developing models and testing the aforesaid subjective factors have impact on the
process of implementing CSR towards employees.
1.2.2. Scientific values inherited in the dissertation
Scientific values inherited from foreign and domestic researches in the
dissemination are (i) Theory of the content of CSR, CSR towards employees; the content
of CSR ensuring employees' rights and interests; the process of implementing CSR
towards employees; (ii) Some research results related to factors affecting the
implementation of CSR and CSR towards employees; (iii) Experience in CSR towards
employees, such as Shenzhou International Group Holdings Ltd (China), CBC Fashions


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(Asia) Private Limited (India), Abu Taher Company leading to lessons learned for
Vietnam garment enterprises; (iv) Analysis of data collected from the Vietnam General
Confederation of Labor, Vietnam Textile and Apparel Association, Ministry of Labour Invalids and Social Affairs, International Labour Organization (ILO) and International
Finance Corporation (IFC),...
1.3. Research methodology
1.3.1. Research approach and process
(i) Research approach
The dissertation focuses on studying the content of CSR ensuring rights and benefits
of employees; the process of implementing CSR towards employees from making plan on
implementation to evaluation of the implementation of CSR towards employees.

articles. Besides, data collected from the General Statistics Office of Vietnam, General
Department of Vietnam Customs, Vietnam General Confederation of Labor (VGCL),
Vietnam Textile and Apparel Association (VITAS), ILO and IFC…
1.3.4. Quantitative research
(i) Preliminary quantitative research
Preliminary quantitative research is carried out on basis of data collected from
surveys conducted in 50 Vietnam in which 152 notes of employees and 107 notes of
managers are collected. The preliminary quantitative research results show that scales of
all variables have Cronbach’s Alpha coefficient greater than 0.6 and the corrected itemtotal correlation greater than 0.3, which means that they are reliable. However, observed
variables such as glv6, CSR14 are eliminated as the corrected item- total correlation is
lower than 0.3. Type of business, the control variable is also excluded because the level
of significance is greater than 10%. H6 is removed. Only business size, the control
variable, is satisfactory with the level of significance lower than 5%.
(ii) Research model of subjective factors affecting the process of implementing CSR
towards employees of enterprises
The research model has a total of 32 observed variables including 4 independent
variables being leadership, strategic planning, corporate finance, corporate culture and 1
dependent variable being CSR and 1 control variable being business size.
Leadership
Strategic planning

H1
H2
H3

Corporate finance
Corporate culture

H4


improvement of the quality of life of employees, appropriate treatment for partners, community,
environment to ensure the sustainable development of businesses as well as society.
2.1.3. Concept of corporate social responsibility towards employees
Corporate social responsibility towards employees of enterprises is to fulfill their
commitments to employees through responsibility for ensuring rights and interests of
employees leading to improvement of the quality of life of employees as well as the
sustainable development of enterprises and society.
2.2. Content of corporate social responsibility ensuring rights and interests of
employees of enterprises
2.2.1.Labor contract
In a labor relation, employees are always in a disadvantageous position. In order to
enforce employees' rights as well as identify a formal labor relation, employees and
employers sign a legal document called a labor contract. Regarding labor contracts with
clauses ensuring rights of employees, signing a labor contract appropriate to the nature of
work and terminating the labor contract in accordance with the labor regulations are
fundamental rights of employees. Besides, many businesses have realized that they need to
attach importance to and enforce clauses ensuring benefits of employees in labor contracts.
2.2.2. Working time
Working time is the period of time that employees must perform work according to
legal provisions, the agreement of employees and employers in labor contracts and
collective labor agreement. Regulations on working time include committed working
hours; extra hours per day, month, year and leave. CSR relating working time should
expand the voluntariness of about extra working hours of employees.
2.2.3. Occupational safety and health


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Regarding CSR ensuring employees’ rights to occupational safety and health,
training on occupational safety and health, fire protection, labor protection, not having

implementation program to issuing and saving store and copy the departments and units in
the enterprise to implement the program on implementation of CSR towards employees.
Some social responsibility programs for employees can be single programs or dual


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programs containing social responsibility to ensure rights and benefits. Firstly, they develop
programs, then prepare written documents on programs and distribute them to other
divisions in enterprises.
Drawing up a budget for implementation: Drawing up a budget is estimating all receipts
and expenditures related to one or more programs of implementation of CSR towards
employees in each period. All receipts and expenditures at any time must be noted exactly.
2.3.2. Implementation of CSR towards employees
Assignment of a division responsible for implementing: In SMEs, the owner or the
division in charge of administration and human resources is responsible for
implementing CSR towards employees. In large enterprises, may be CSR committee or
Advisory and Innovation or Life quality committee.
Preparation for written registration for the code of conduct: enterprises must
initially contact organizations having right to grant the certificate. After receiving written
registration of enterprise, the organization will evaluate preliminarily and officially
regulations in the code of conduct.
Issuing instructions on how to comply with the CoC: Enterprise have to provide a
unified set of documents to all departments and employees specifying responsibilities,
obligations and duties of the department in charge of CSR and other departments making
them aware of and fulfill their own ones.
Implementation of internal communication activities on implementation:
Enterprises need to well inform each employee of the content, process and time of
implementation of its CSR towards employees through traditional and modern internal
communication activities.

their decisions have an impact on the implementation of CSR.
2.4.2. Strategic planning
In opinion of Carroll (1984), “Strategic planning is a necessary condition to
implement CSR towards employees" as strategic planning is to develop and follow the
roadmap for achieving selected strategic objectives.
2.4.3. Corporate finance
Finance plays an important in every activity of enterprises. With a view to implementing
well CSR towards employees, enterprises must pay attention to their financial status.
2.4.4. Corporate culture
From the point of view of Kotter, J.P. & Heskett, J.L (2011), “Culture also reflects a
combination of values and interdependent behaviors that are common in enterprises and
tend to be passed down for a long time”.
2.4.5. Business size
From the establishment to development of an enterprise, its size may be the same or
increase. Results of some researches show an important and positive link between the
enterprise’s size and implementation of CSR towards employees.
2.5. Objective factor affecting CSR towards employees of enterprises
2.5.1. Situation of economic development and international economic integration
Globalization and international economic integration have been prominent trends of
the world economy. Economic integration requires enterprises to implement CSR


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towards employees to ensure fundamental rights of employees in line with ILO and labor
standards of bilateral, multilateral and free trade agreements (FTA) signed by countries.
2.5.2. State management on the implementation of CSR towards employees
The State promulgates legal provisions and policies related to the implementation
of CSR towards employees of enterprises in the Labor Code, Law on occupational safety
and health,...The State assigns the central and local agencies to implement CSR towards

3.1. Overview of Vietnam garment enterprises
3.1.1. The establishment and development of garment enterprises
The establishment and development of Vietnam garment enterprises from 1958 to
now with 5 particular stages: From 1958 to 1975, from 1975 to 1990, from 1990 to
2000, from 2000 to 2010, from 2010 to now.
3.1.2. Some business results of garment enterprises
According to the Export Promotion Organization (2017), "Vietnam's export growth
rate in the period of 2010 - 2017, which was 32%, reached the highest level in the world".
Vietnam’s textile and garment products have been popular all over the world. Optimistic
business results are an important basis for implementing CSR towards employees.
3.1.3. Characteristics of labor in garment enterprises
Labor in garment enterprises has some following characteristics: unequal distribution,
high proportion of female employees, high proportion of untrained employees, labor
instability, labor transfer, high risk of being eliminated of aged employees.
3.2. The situation of the content of CSR ensuring rights and benefits of employees
of garment enterprises
On the basis of 782 survey notes collected from employees and 308 survey notes
collected from enterprises’ managers, the EFA of 5 factors (hdld, glv, at, lp, td) and CFA
show that the contents of CSR ensuring rights and benefits of employees are appropriate
to market data and meet requirements related to unity, convergent and discriminant
validity, which together with secondary data results in the following analysis:
3.2.1. The situation of labor contract
Responsibility for ensuring the right to labor contract of employees: Results of the
performance of responsibility for ensuring the right to labor contract are average,
3.13/5.0; "signing the contract appropriate to the nature of work - hdld2" has the highest
score (3.36/5.0) because signing the contract appropriate to the nature of work is the
basis for building a harmonious relationship between employees and employers. Large
garment enterprises have paid attention to "clauses ensuring rights of employees hdld1", however, SMEs fail, which have been shown by ILO & IFC in recent years.



organization of "advanced health care programs for employees- at5” in large enterprises is
considered average meanwhile in SME there are still many shortcomings. In large garment
enterprises, "the organization of cultural and sports activities for employees- at6” receives
optimistic feedback and employees have many opportunities to interact with their colleagues
but "taking care of health for employees” is still a limitation of SMEs especially small ones.
3.2.4. The situation of salary and welfare


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Responsibility for ensuring the right to salary and welfare of employees: Results of the
performance of responsibility for ensuring the right to salary and welfare of employees
achieve 3.21/5.0. "Properly complying with the minimum salary provision- lp1" has the
highest scores. Both large enterprises and SMEs strictly follow provisions on minimum
salary as well as the Decree No. 49/2013/ND-CP and the Decree No. 121/2018. "Abiding
by regulations on overtime on weekdays- ld2" is what large enterprises do but SMEs have
the lowest scores.
Responsibility for ensuring benefits of employees related to salary and welfare:
Garment enterprises have increased CSR regarding salary and welfare of employees and
get 3.02/5.0. "Competitive salary payment-lp5" is the expectation of both employers and
employees. However, "paying allowances higher than prescribed- lp6” is still quite
limited in large enterprises and strange to SMEs.
3.2.5. The situation of freedom of association and collective bargaining
Responsibility for ensuring the right to Responsibility for ensuring of employees:
The implementation of CSR regarding freedom of association and collective bargaining
achieves 3.03/5.0 helping enterprises minimize problems arising in the labor relation. In
Vietnam garment enterprises, "the organization of annual employee conference- td3" is
to create a forum to promote direct democracy at work. Large-scale garment enterprises
focus on "establishing grassroots labor union- td1" but not many SMEs do.
Responsibility for ensuring benefits of employees related to freedom of association

"assignment of a division responsible for implementing CSR towards employees- CSR5" but
SMEs fail. According to survey results, 26.29% of large enterprises (81 in 308 enterprises)
lead the way in the assignment of a division to implement CSR towards employees.
Preparation for written registration for the code of conduct: Large enterprises have
“prepared for written registration for the code of conduct on CSR towards employeesCSR6” quite well but SMEs have just done this work averagely. Large enterprises apply
codes of conduct on CSR in order to get involved in international trade. However,
according to survey results, only 29.22% of enterprises (90 in 308 enterprises) have
prepared for written registration for the code of conduct on CSR towards employees.
Issuing instructions on how to comply with the CoC: “Issuing instructions on how
to comply with the CoC on implementation of CSR towards employees- CRS7” is
followed by almost large enterprises, while it is shown in slogan and business
philosophy of SMEs.
Implementation of internal communication activities: "The implementation of
internal communication activities on the implementation of CSR towards employeesCSR8" is stuck with difficulties in both large enterprises and SMEs. That’s why only
21.10% large enterprises (65 in 308 enterprises) have done this work. Their division in
charge of implementing CSR towards employees cooperates with the communication
department and other departments in information storage and processing.
Organization of training courses: In large enterprises, training is the key for a professional
division who is in charge of implementing CSR. This work seems strange to SMEs.
Deployment of programs on implementation: “Deployment of programs on
implementation of CSR towards employees-CSR 10” in large enterprises gets positive
results but faces many difficulties in SMEs. According to survey results, 70.78% of


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SMEs have not implemented CSR towards employees due to objective determination
failure and insufficient budget.
3.3.3. The situation of evaluation of the implementation of CSR towards employees
Determination of evaluation criteria: Large enterprises have gradually been interested

been selected in line with the size of enterprises.


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3.5. The situation of objective factor affecting the implementation of CSR towards
employees of Vietnamese garment enterprises
3.5.1. The situation of economic development and international economic integration
of our country
The international economic integration has created opportunities making Vietnam's
economy more dynamic than ever. Vietnam enterprises are aware of the process of
entering FTAs, however, they are not able to abide by labor regulations immediately.
3.5.2. The state management on implementation of CSR towards employees in
Vietnam
The process of developing and promulgating legal documents of the State is strict
and logical. Hundreds of effective documents cover almost all aspects of CSR towards
employees. The implementation of relevant policies and laws is a complex and multisectoral issue. The number of inspectors is quite small and their qualification is limited.
3.5.3. Current codes of conduct regarding CSR towards employees
The code of conduction that are popularly applied by Vietnam garment enterprises is
SA 8000. In order to obtain the WRAP certificate, enterprises only have to abide by
regulations on protection of employee's rights, environmental protection and comply with
regulations on occupational safety and health...
3.5.4. Other stakeholders
Customers have tightened regulations. Limited supply of raw materials in the domestic
market is a big difficulty for garment enterprises. The community is the foundation for the
development of enterprises. Un some localities, public opinion has not been taken seriously.
3.6.  General  assessment   of   the   situation   of   CSR  towards   employees   of   Vietnam
garment enterprises
3.6.1. Achievements and reasons
Achievements

systematically. Besides, large enterprises still encounter some difficulties in CSR accounting.
Reasons for the aforesaid limitations
Objective reason are: Enterprises have got involved in international trade very fast
leading to their unsustainable development; Tthere are still many shortcomings in the
state management on CSR towards employees; Many codes of conduct on labor and
their implementation require technical facilities and human resources; Customers have
tightened regulations; Enterprises still rely too much on suppliers; The community has
not put strong.
Subjective reasons are: Business leaders still face some obstacles; many garment
enterprises have not paid adequate attention to strategic planning for their sustainable
development; garment enterprises, especially SMEs are not able to mobilize capital;
salary payment forms are not really flexible and appropriate.


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CHAPTER 4
SOLUTIONS TO IMPROVEMENT OF CSR TOWARDS EMPLOYEES
VIETNAM GARMENT ENTERPRISES
4.1. Orientation of development and direction of operation of Vietnam garment
enterprises from now to 2025 with vision to 2030
4.1.1. Orientation of development of garment enterprises
With a view to promoting the development of the textile industry to be a key one,
the decision No. 3218/QD-BCT, Decision No. 432/QD-TTg, the Decision No. 145/QDTTg focus on developing the quantity and quality of human resources for sustainable
development and labor management in line with international standards of DNmay.
4.1.2. Direction of operation of garment enterprises
Direction of operation of Vietnam garment enterprises is diversifying export
markets, expanding the domestic market, renewing export marketing methods and
continuing to carrying out training programs for their human resources.
4.2. Perspectives on strengthening of CSR towards employees of Vietnam garment

activities for employees to help them connect with each other as well as express
gratitude and appreciation to employees.
4.3.4. Ensuring the implementation of CSR towards employees
regarding salary and welfare
Ensuring the payment of overtime pay is a cure for the chronic shortage of employees of
enterprises. SMEs must ensure social insurance and health insurance for their employees in
accordance with provisions of the law, pay competitive salary for employees, pay higher
allowances than prescribed and provide housing support to short-term and long-term
employees.
4.3.5. Performance of responsibility for ensuring freedom of association and collective
bargaining of employees
Leaders of enterprises must always actively raise their awareness about labor
relations in order to create good conditions for the establishment and development of
trade unions. Leaders of enterprises need to consult their trade union about benefits for
employees, sign collective labor agreements having better clauses compared to labor
regulations contributing to regulating benefits of both employees and employers.
4.4.Promotion of the process of implementing CSR towards employees of Vietnam
garment enterprises
4.4.1. Making plan on implementation of CSR towards employees actively
Paying attention to defining objectives of implementing: The more specific
objectives are, the more feasible they are. Enterprises need to define their objectives of
implementing CSR towards employees over time, from making the list of foundations
for setting objectives to making an objective summary in line with each period of
development of enterprises from its establishment, growth, stability and degradation.
Researching and selection of codes of conduct regarding: In International Trade,
labor standards and implementation of CSR towards employees have become
compulsory so that actively researching and selecting codes of conduct on CSR, garment
enterprises shall create an opportunity on their own to dominate the world market.
Improvement of the method of development of programs on implementation:
Garment enterprises need to actively improve their method of development of programs

order to achieve good results in the implementation of CSR towards employees with
limited resources, enterprises should promote the issuance of instructions on CSR
towards employees by raising awareness of employees about SA8000, WRAP, OHSAS
18001...; conduct quarterly and yearly internal assessments to find out limitations.
Organization of the information systems regarding the implementation: Garment
enterprises need equipping with modern information infrastructure such as: SV.HRIS,
Lucky Hrm... in order to have a complete and updated information database on the
implementation of CSR towards employees.
Enhancing of the internal communication on the implementation: Garment
enterprises have a transparent, clear and multi-dimensional internal communication
strategy. In the implementation of CSR towards employees, enterprises need digital
internal communication channels: internal magazine, intranet, electronic newsletter...


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Improve the quality of training courses for human resources implementing: The training
framework should be selected on the basis of the content, form and location of training. It
consists of training objectives, forms, schedules, contents and methods and audience.
Promotion of resources in the implementation of programs: The implementation of
CSR towards employees requires the mobilization of all resources. In the process of
mobilizing all resources, it is necessary to take into account the ability of enterprise
meaning that the SWOT analysis should be used.
4.4.3. Focusing on controlling the implementation of CSR towards employees
Enhancing the development of criteria for controlling the implementation: With a
view to controlling the implementation of CSR towards employees, enterprises should
promote the development of criteria for controlling the implementation of CSR and pay
attention to both quantitative and qualitative ones.
Attaching importance to the measurement of main results of the implementation:
The measurement of main results of the implementation of CSR should be carried out

Enterprises need to take the initiative in the budget planning for the implementation
of CSR towards employees. On basis of the strategic planning and the model of CSR
towards employees, they will carry out appropriate policies and measures to improve the
efficiency of capital mobilization and supplementation in accordance.
4.5.4. Selection of the model of the implementation of CSR towards employees in
accordance with the size of garment enterprises
In SMEs, the division responsible for the implementation of CSR towards employees
must perform their duties flexibly and appropriately. However, large enterprises must assign a
professional department to implement CSR methodically and systematically.
4.6. Proposals and recommendations to improve objective factor to facilitate CSR
towards employees of Vietnam garment enterprises
4.6.1. Proposals to other stakeholders to increase their pressure on garment
enterprises to implement CSR towards employees
Customers and suppliers must take drastic actions to make enterprises implement
CSR towards employees regularly and completely. In addition, the community should
more pressure to force enterprises to implement CSR towards their employees.
4.6.2. Petition to the National Assembly, Government, Ministries and Departments
The Government should have a roadmap for economic development and
international economic integration: The Government should pay more attention to
economic development to promote the internal strength and affirm Vietnam's position in
international trade. It is also necessary to abide by global labor standards conventions.
Besides, regarding negotiated FTAs, it is important to quickly carry out procedures and
legal review to prepare for the official signature.
The National Assembly and the State should complete legal documents related to
CSR towards employees: It is essential to complete the process of developing and
promulgating policies, complete the legal framework to create a solid and progressive
basis for the Labor Code, Law on Occupational Labor and Safety. The State also need to
support enterprises and employees in the implementation of the Decree No. 85/2015/
ND-CP. Responsibilities of the Ministry of Industry and Trade should be clearly defined
and a specialized management agency responsible for the implementation of CSR