CSR reflects a company’s commitment to conduct its operations while considering social and environmental impacts. This article will discuss the definition of CSR, regulations related to CSR fund allocation in Indonesia, benefits, objectives, types of CSR, and examples of its implementation.
What is Corporate Social Responsibility (CSR)?
Corporate Social Responsibility (CSR) is a concept gaining increasing attention in the modern business world. In the corporate context, CSR is not just about seeking financial profits but also about making a positive contribution to the surrounding community and environment.
As a form of responsibility for the social and environmental impacts of business activities, corporate CSR involves policies and practices designed to achieve a balance between economic growth and social well-being. In Indonesia, this concept has become an integral part of corporate governance.
Regulations Related to CSR Fund Allocation in Indonesia
Regulations related to CSR fund allocation in Indonesia include:
Law Number 40 of 2007 concerning Limited Liability Companies (Company Law).
Government Regulation Number 47 of 2012 concerning Social and Environmental Responsibility of Limited Liability Companies (PP 47/2012).
The CSR fund amount is a minimum of 2% to 4% of the total annual profits. However, the specific amount is not fixed and depends on the company’s policies.
Benefits of CSR
The benefits of CSR are experienced by society, the environment, and the companies themselves. By investing in social and environmental activities, companies create a positive impact that can enhance their image in the eyes of consumers. For example, education or health programs supported by companies can improve the quality of life in the surrounding community.
Objectives of CSR
The main objective of CSR goes beyond mere compliance with legal obligations. Companies implementing CSR usually have a long-term vision to make a sustainable positive contribution. These objectives may include reducing the company’s carbon footprint or enhancing the well-being of the local community.
Types of CSR
The types of CSR vary depending on the industry and local context. Some companies may focus on human resource development, while others may be more oriented towards environmental projects. It is essential for companies to choose CSR types that align with their core values and consider the needs of the communities around them.
Examples of CSR
To provide a more concrete overview, here are some successful examples of CSR implemented by companies in Indonesia. For instance, PT XYZ launched a scholarship program for underprivileged children in their operational areas, while PT ABC focuses on reforestation projects to support environmental sustainability.
By adopting CSR, companies not only make a positive contribution to society and the environment but also build better relationships with stakeholders. CSR is not just an obligation but also an opportunity to create sustainable positive change.
