Public Service Meets Profit
With record net after-tax profits last year, Delta Electronics is living proof that public service and concern for the environment are not antithetical to running a profitable business.
Public Service Meets ProfitBy Ching-Hsuan Huang
From CommonWealth Magazine (vol. 452 )
Around noon on a Thursday in late July, a group of students crowds around a solar panel in the second-floor exhibition room at the headquarters of Delta Electronics. A gravelly voice not belonging to the group of young people suddenly emerges from the midst of the throng.
Bruce C.H. Cheng, founder and chairman of Delta Electronics, patiently describes each highlight of the display to the students, as if presenting a product to customers. He has actually already spent the entire morning speaking with the students, recipients of Delta environment scholarships, about concern for the global environment and his expectations for them.
"Just throwing money at problems doesn't solve them," says Yancey Hai, company vice chairman and CEO. "It's not about being generous; you have to generate."
Becoming aware of the importance of corporate social responsibility before most of its peers, and getting involved in both charity work and environmental protection efforts, Delta Electronics' core business has developed in alignment with global trends, by diversifying operations into a variety of "green energy" businesses. Despite the economic crisis that continued to grip the world over the first half of 2009, Delta achieved a net after-tax profit margin of 39.45 percent for last year, a new record for the company.
As Wang Wan-li, head of research at HSBC Securities Taiwan, avers, "Delta Electronics proves that doing good things and making money aren't mutually exclusive."
Today, four years since the introduction of the CommonWealth Magazine Corporate Citizenship Awards for corporate social responsibility, the positive energy gradually built up by Delta has finally paid off, as the company claims top honors, supplanting perennial winner TSMC.
Overseas Investors Affirm Corporate Governance
Overseas and domestic investors alike have heaped praise on Delta.
This July Delta's ex-dividend share price reached an historical high. Foreign holdings in the company also set a new rate, at 74.7 percent, making Delta the company with the highest ratio of foreign capitalization on the Taiwan Stock Exchange.
This affirmation by foreign investors proves the global competitiveness of Delta Electronics' green enterprises, and demonstrates the efficacy of the long-term matching of social responsibility and company strategy.
"Foreign capital holdings and corporate governance are highly correlated," offers Calvin Chang, vice president of Fubon Financial, previously named "top analyst" at Credit Suisse.
From corporate governance to environmental protection, conventional power supplies to focusing on "energy efficiency and low carbon footprint" as the core of business development, Delta Electronics proves that doing one's part for society is good business.
Translated from the Chinese by David Toman
Corporate Citizenship Achievements
Corporate Governance: 8.7
Information disclosure rating of A+ for the second year running.
Corporate Commitment: 9.9
Established the Da Vinci Innovation Award, recognizing outstanding innovative teams.
Social Participation: 9.7
Donated "green buildings" and rebuilt "carbon-neutral" campuses following Typhoon Morakot.
Environmental Protection: 9.6
Every product is designed around the concept of energy-saving.