Thursday, June 23, 2011

CSR and a company’s brand image

WE often hear of disputes between private companies and the public. Indeed, as a profit center, a company carries the burden of making as much profit as possible, but on the other hand, the public perceives the company is selfishly paying attention to its own business interests without caring about the difficulties experienced by the public caused by its activities such as contamination, pollution, damaged roads and so forth.

Such disputes between a company and the public are a threat to the company’s production activities. To protect the existence of companies and to create a harmonious relationship with the public, the government has issued a related policy that makes it compulsory for a company to conduct corporate social responsibility (CSR) activities.

Basically, the substance of CSR is to strengthen the existence of the company by developing collaboration among stakeholders facilitated by the company’s community development programs. The aim of CSR is crystal clear, that is, the company, which makes use of natural resources, should also be concerned about the impact on the environment as well as the public or communities in its area of operations. It is also quite clear that the exploitation of natural resources without sufficient attention toward the environment will certainly damage the ecosystem which in turn will threaten the communities’ economic activities.

This is one of the reasons why the company is required to develop environmental programs as well as community development programs that are directly in line with the communities’ interests and benefit, such as hospitals, health centers, schools, scholarships and capital for small- and medium-sized enterprises to reduce the social gap between the company’s employees’ income and the local people.

The use of CSR funds for social activities and environmental preservation is mandated in Law No. 40 issued in 2007 about Limited Companies and Law No. 25 issued in 2007 on Capital Investment as well as Law No. 19 issued in 2003 on State-Owned Enterprises (BUMN) that states that companies /BUMN/ investors must participate in the development of a sustainable economy to enhance the quality of life and environment. Therefore, the use of CSR funds can be directed toward various social and environmental activities.

Based on a number of examples from various regions in the country, it is obvious that some companies have implemented appropriate CSR activities, such as the planting trees and other environmental preservation activities. However, some activities are not well coordinated and have not had a significant impact on environmental preservation.

At least, what is clear now is that many people are paying great attention to environmental issues and most organizations have made it part of their work program. Many companies have included environmental preservation in their CSR programs. Of course, unfortunately to date, many are only focusing on reforestation or planting of trees.

Indeed, forests with their various trees are capable of absorbing carbon dioxide. The forests provides oxygen to humans without asking whether they have planted trees or not, because it is simply the duty of the trees to absorb carbon dioxide and release oxygen that is essential for humans and animals alike. “A forest has a vital function for the lives of humans and other living species, so planting trees is a very efficient way to preserve the environment,” said an expert at the Environment Ministry, Yanuardi Rasudin, recently.

But actually, CSR programs should go further than merely planting trees, such as the inclusion of other “go green” programs: making biopore holes, compost, reducing the use of plastic bags, reducing the use of fuel that creates carbon dioxide.

Everyone agrees that the lives of human beings are inseparable from their environment, both the natural as well as social environment as all of us need clean air to breathe and all other activities — eating, drinking, taking care of our health and so on — require a clean and healthy environment.

Preserving the environment is one of the most vital activities to maintain balance in the life of humans as well as other living species on the planet. Such concerns were declared by the United Nations on April 22, 1970, and every year we commemorate this important date.

Yes, the environment around us is not a legacy from our forefathers that we can use indiscriminatingly. It is in fact a deposit for the future generation, so we must maintain and conserve the environment for their use as well. (Burhanuddin Abe)

The Jakarta Post, June 23, 2011

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