Corporate Social Responsibility In Macau Gambling Industry
(2015) An Initial Exploration of Corporate Social Disclosure and Responsible a Gambling Disclosure in Macau’s Gambling Industry. (eds) Corporate Social Disclosure. Palgrave Macmillan Asian Business Series. Corporate social responsibility (CSR) was one of the important marketing tools for Macau gaming companies nowadays. Responsible gambling (RG), which was a part of CSR, had been part of the Chief Executive policy since 2007. The so-called 'Monte Carlo of the Orient', Macau's economy relies heavily on gambling. Nowadays, the gambling industry generates over 40% of the GDP of Macau. Since the early 1960s, around 50% of Macau's official revenue has been driven by gambling. The percentage remained steady until the late 1990s.
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The 'Interim Review of Gaming Liberalization for Games of Fortune' Research Report released today
Office of the Secretary for Economy and Finance
Corporate Social Responsibility In Macau Gambling Industry Act
Press Release
11 May 2016
The “Interim Review of Gaming Liberalization for Games of Fortune in Macao: economical, social, livelihood impacts and operating conditions of the Concessionaires” research report is released today (11 May). The study covered nine research topics in four categories, including the contractual and operating conditions of Concessionaires and Subconcessionaires; economical, social and livelihood impacts of the development of the gaming industry; and current situation of junket promoters. After analysing the relevant data and statistics, the research team concluded that the six gaming operators have all fulfilled the capital commitment in their contracts. Development of the gaming industry has obviously created positive impact on the economy and society of Macao and at the same time negative impact. Proportion of local employees in gaming operators is much higher than that of overseas employees. Non-compliance in a number of areas also showed a downward trend.
Office of the Secretary for Economy and Finance commissioned the Institute for the Study of Commercial Gaming, University of Macau to conduct a research titled “Interim Review of Gaming Liberalization for Games of Fortune in Macao: economical, social, livelihood impacts and operating conditions of the Concessionaires”, in order to have a comprehensive review of the implementation of gaming concessions and to analyse the level of impact that the development of the gaming industry had on the local economy, business environment for small and medium-sized enterprises (SMEs), as well as to the society and the public. It also studied the synergetic effect between gaming and non-gaming elements, as well as the development and current situation of junket promoters since gaming liberalization. The research will help review the operating conditions of the gaming industry in Macao and the fulfilment of corporate social responsibility by the gaming operators, which will be an important reference for further improvement of gaming laws, regulations and regulatory framework to promote quality and integrity in gaming operations, and in turn its healthy development.
One of the core research directions was to collate and analyze the fulfilment of contracts and their operating conditions by Concessionaires and Subconcessionaires (including the fulfilment of the contract, operating conditions, social responsibility and compliance status). The report stated that the six gaming operators have all fulfilled the capital commitment in their contracts. Majority of their employees were in the gaming field, the overall proportion of local employees is much higher than that of overseas employees. Besides, all of the six gaming operators provided opportunities for upward and lateral mobility to their employees, in which the proportion of local employees of managerial grade or above increased from around 60% in 2008 to 80% in 2014. Research analysis was also conducted on various areas such as the gaming operator's number of employees, upward and lateral mobility situation, changes in salary and training.
Analysis of the research shown that the development of the gaming industry had positive impact on Macao's society and economy and synergetic effect was found alongside the gaming and non-gaming elements. Nonetheless, negative impact such as pushing up the inflation rate, housing prices and business operating costs, creating crowding out effects on SMEs and affecting social values were created, which need to be continuously monitored and dealt with. Despite the positive role of junket promoters in the development process of the gaming industry, there are still bound to be problematic areas which needs stronger regulatory effort in order to enable a healthy and orderly development of the industry.
In terms of compliance status, the number of non-compliance cases in the six gaming operators shown a downward trend. Cases of non-compliance include internal control and reporting deficiencies in prevention of money laundering and terrorist financing; execution of “Minimum Internal Control Requirements” and “Guidelines on Responsible Gambling ”.
As assessment of corporate social responsibility varies in different places, therefore, when the research team evaluates the fulfilment of corporate social responsibility by the six gaming operators in Macao, the first criteria lies on the demands of the local community towards the gaming corporations, such as: transportation/accommodation arrangements for overseas employees, supporting SMEs, local procurement and development of non-gaming elements, etc. In addition, the research team has also referred to common international assessment criteria and selected consumer issues and social engagement & development as the two assessment topics for comparison. Analysis shown that all of the six gaming operators had transportation arrangement for their employees. They had also established mechanisms to handle consumer issues. Several gaming operators have supported SMEs by giving priority to local SMEs in procurement of services or products.
Table:
Fulfillment of capital commitments
in gaming concession and subconcession contracts
Corporate Social Responsibility In Macau Gambling Industry History
Company Name | Capital amount in concession and subconcession contract | Committed period of capital expenditure | Date of signing the concession and subconcession contract | Actual capital expenditure in committed period (within 7 years) | Fulfillment Status of capital commitments in concession and subconcession contract |
(Million MOP) | (Million MOP) | ||||
Sociedade de Jogos de Macau S.A. | 4,737 | Must be expended within 7 years from the concession contract date | 28/3/2002 | 11,527 | Completed |
Wynn Resorts (Macau) S.A. | 4,000 | Must be expended within 7 years from the concession contract date | 24/6/2002 | 12,607 | Completed |
Galaxy Casino, S.A. | 8,800 | Must be expended within 7 years from the concession contract date | 26/6/2002 | 7,588＊ | Completed |
Venetian Macau, S.A. | 4,400 | Must be expended within 7 years from the subconcession contract date | 19/12/2002 | 53,501 | Completed |
MGM Grand Paradise, S.A. | 4,000 | Must be expended within 7 years from the subconcession contract date | 19/4/2005 | 10,267 | Completed |
Melco Crown (Macau), S.A. | 4,000 | Must be expended within 7 years from the subconcession contract date | 8/9/2006 | 42,322 | Completed |
Source: Annex to the concession and subconcession contracts (investment plan); Actual capital amounts were provided by the DICJ (DICJ provided the annual actual capital expenditure, which the research team converted into pro-rata daily actual capital expenditure for calculation purpose). NOTE: The actual capital expenditure of Galaxy Casino, S.A. within 7 years from the date of the contract (26/6/2002-26/6/2009) was only 7.588 billion MOP, which is less than the required capital amount in the concession contract (8.8 billion MOP). However, according to the subconcession contract between Galaxy Casino, S.A. and Venetian Macau, S.A., part of the items in Galaxy’s original investment plan has been transferred to Venetian. Thus, according to the agreement, capital expenditure of the latter was calculated into the total capital amount of the former, with a limit of 4.4 billion MOP. For detailed explanation, please refer to the research report (Investment Plan in Concession and Subconcession contracts). Thus, Galaxy has fulfilled the committed capital requirement in the concession contract. |
Corporate Social Responsibility In Macau Gambling Industry Workers
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