Have you heard of corporate social responsibility? This is usually something that must be done for a company. CSR is a program or action that must be done by the company to develop the social and natural environment at the location of the establishment of the company. The program runs by focusing on the company’s sense of responsibility towards the surrounding region sustainably. In addition to providing its responsibility to the community and the environment, CSR itself can build a positive image of a company in the view of the community through their concerns.
This program has been popular in Indonesia since the 1990s. Generally, CSR is managed by the public relations department as well as direct officials of a company. ISO 26000 which is an international standard for all organizations also affirms that CSR is a responsibility of companies to be more impactful for the community with the importance of sustainable development and community welfare.
Let’s get into the explanation of the definition of CSR. Corporate Social Responsibility or popularly known as CSR is a voluntary action that companies do to show a sense of responsibility of a company to the people who live in the area around the company, and show a sense of concern for nature. Although it is voluntary, CSR is regulated by law. So that with these regulations, companies become more aware of concern for others and nature.
Generally, CSR is written in the regulations that the government makes and explains that companies as legal subjects have social and environmental responsibilities. But under the Law, this regulation applies to companies that utilize natural resources in their operations. In addition, companies that do not utilize SDA, but in their operations have a direct impact and can cause environmental damage are also obliged to perform these responsibilities.
According to NVPC’s latest Corporate Giving Survey, 52% of Singaporean companies are involved in some CSR program. So, the government hopes that with this program the company can implement a form of good corporate governance.
What is the Purpose of Corporate Social Responsibility (CSR)?
The purpose of the CSR program is to build and maintain the company’s relationship with the surrounding environment and also build relationships to be able to provide benefits to the community. Therefore, the government continues to play a role in developing and empowering the community together with the company.
Several areas that are important objectives of CSR programs in companies, that is:
1. Developing the economy
Companies can hold activities in agriculture or agriculture, cooperatives, even SME partners.
2. Health and nutrition fund for the inhabitant
The company donates funds to public health programs, such as counseling, immunization of toddlers, sanitation, and other forms of treatment.
3. Managing the cleanliness of the environment and natural resources
The company conducts waste management programs in rivers and residents’ settlements. In addition, teaching and doing household waste management.
4. Pay attention to education, skills, and training
Companies can provide scholarship programs for students who live around the company, hold skills training for the community, etc.
5. Provide health to education, skills, and training
By holding fun activities, the public will also see that the company is a positive and caring organization. Companies can improve community environmental facilities, hold social services, iftar programs together with the community for Muslims, etc.
Types of CSR that Companies Do
Now we will discuss what types of CSR can be done by companies. There are several types of CSR, that is:
1. Environmental development efforts
We know that companies will contribute to industrial waste. Therefore, the company has a responsibility to manage the environment. For example by doing waste management so that it does not pollute the environment, reforestation, etc.
Philanthropy is a humanitarian activity to help the poor or affected. Examples of this activity are fundraising, opening entrepreneurial opportunities, and providing MSME funding assistance.
3. Friendly work environment
Enacting a friendly work culture is not only about salary, but also includes good values and character.
4. Volunteer activities by CSR
Volunteer activities walking in regularly or at certain times. For example, doing volunteer activities by sending teaching staff to remote villages, medical volunteers, facilities building teams in the village, natural disaster volunteers, etc.
5. Economic empowerment for employees
Companies can also conduct economic empowerment activities for employees. The company will allocate funds to improve employee skills through training and seminars. In addition, there are cooperatives for employees, training in entrepreneurial capabilities so that employees can increase income, as well as business fund assistance for employees.
Benefits of Corporate Social Responsibility (CSR)
There are several benefits in CSR programs. The benefits of CSR are not just about giving a positive image to the company. But it’s more than that. Here are the benefits:
1. For the environment
CSR can protect the environment through its programs. This program will require companies to not only pursue materials, but contribute to improving the quality of the environment.
2. For the inhabitant
With this program, the welfare of the community in the corporate environment increases, students who are less able to get an education, the improvement of public facilities becomes more feasible and diverse, and the company can absorb labor through the surrounding community.
3. For the company
The CSR program will bring the company brand better known by the public, the company’s image will be built positively, and can be a differentiator of the company with other companies. In addition, during the CSR program, the company will have the idea to innovate for the company.
4. For the government
CSR runs intending to support the programs that the government has created. The program helps the government through all the social activities that companies undertake, such as waste treatment, scholarship programs for underprivileged students, and reduces the unemployment rate by absorbing labor.
Budget Needed in CSR Program
Maybe you have wondered, how much funds the company prepares to run this CSR program. Moreover, this program looks like it requires a lot of funds because of the many types and coverage that companies must achieve. In this program, companies must set aside budgets in fulfilling social responsibility.
As reported through Channel News Asia, since the pandemic entered Singapore, many food companies have been distributing 2.000 meals to the needy. So, there is no definite rule on how much budget the company must spend on this program. However, the company must do budget calculations with a reasonable amount.
In carrying out social obligations through CSR programs, surely you have to spend the company’s budget. Therefore, you must ensure that the calculation of the budget is right and will not hinder the course of the company’s main business activities.
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