Pertemuan 3 - CSR - Rosanah, S.S., M.I.Kom., AMIPR

Summary

This video lecture, led by Rosana Ali from Universitas Siber Asia, explores the evolution of Corporate Social Responsibility (CSR) from its origins in the 1930s to its modern-day implementation in Indonesia. The session covers key historical milestones, including the influence of Howard Bowen in the 1950s and the formalization of CSR in the 2000s. The lecture highlights CSR's importance as a strategic tool for businesses, addressing challenges such as misconceptions and its perceived cost. Emphasizing the ethical responsibility of companies, it advocates for CSR as a long-term investment that builds trust and strengthens community relations.

Takeaways

• 😀 CSR (Corporate Social Responsibility) began in the 1930s, driven by societal demand for businesses to take moral responsibility for their actions towards communities.
• 😀 In the 1940s, the concept of 'Community Development' emerged, focusing on empowering communities through collaborative efforts from businesses, government, and NGOs.
• 😀 The 1950s marked the formalization of modern CSR, largely due to Howard Bowen’s influential work, 'Social Responsibility of the Businessman.'
• 😀 Bowen is considered the 'Father of CSR' for introducing the idea that businesses must be responsible for their impact on society and the environment.
• 😀 In the 1960s, CSR expanded with the introduction of the 'Triple Bottom Line,' emphasizing the importance of profit, people, and the planet in business operations.
• 😀 CSR in Indonesia gained popularity in the 1980s and 1990s, with businesses implementing CSR programs in response to societal needs like disaster relief and educational support.
• 😀 In 2007, Indonesia passed a law (Law No. 40) mandating CSR activities for companies in industries related to natural resources, solidifying CSR as a legal requirement.
• 😀 Despite its legal basis, there are misconceptions in Indonesia that CSR is just an obligation, a cost, or only applies to businesses in natural resource sectors.
• 😀 CSR is often seen by businesses as a cost rather than an investment, which limits its potential for creating long-term value and improving corporate reputation.
• 😀 ISO 26000 standards, established in 2020, emphasize the global importance of CSR, advocating for transparency, ethical behavior, and sustainability in business practices.
• 😀 CSR should be viewed as a strategic investment that helps build trust with stakeholders, enhance business reputation, and contribute to sustainable community development.

Q & A

What is the historical origin of Corporate Social Responsibility (CSR)?

CSR originated in the 1930s, during a period of industrial growth when businesses were criticized for neglecting the welfare of surrounding communities. Economic downturns and rising unemployment highlighted the need for businesses to consider their societal impact and address local issues.

How did the 1940s contribute to the development of CSR?

In the 1940s, the concept of 'Community Development' (ComDev) emerged, which focused on a community-based approach to development. It involved collaboration between the government, private sector, and non-governmental organizations to address social issues, laying the groundwork for modern CSR practices.

Who is considered the 'father of CSR' and what was his contribution?

Howard Bowen, often called the 'father of CSR,' published a seminal book in the 1950s titled 'Social Responsibilities of the Businessman.' His work established CSR as a fundamental responsibility of businesses to contribute positively to society, providing the basis for CSR practices worldwide.

What is the Triple Bottom Line, and how did it impact CSR in the 1960s?

The Triple Bottom Line, introduced by John Elkington in the 1960s, expanded the concept of CSR by emphasizing three pillars: economic, social, and environmental performance. This framework encouraged businesses to consider not just financial profits but also their environmental and social responsibilities.

How did CSR practices evolve in Indonesia during the 1980s and 1990s?

In Indonesia, CSR began to gain popularity in the 1980s and 1990s, particularly in response to natural disasters, social needs, and the growing awareness of corporate responsibility. Companies started to implement CSR activities like disaster relief, scholarships, and community aid.

What significant legal framework was introduced in Indonesia in 2007 regarding CSR?

In 2007, Indonesia passed the Limited Liability Companies Law (Undang-Undang Nomor 40), which required companies engaged in natural resource management to implement CSR practices. This law formalized CSR as a legal obligation for businesses in specific industries.

How does CSR relate to ethical business practices?

CSR is closely tied to ethical business practices, as it emphasizes the responsibility of companies to act transparently, ethically, and sustainably. Businesses are expected to contribute positively to society while minimizing negative impacts on the environment and communities.

What is ISO 26000, and how does it relate to CSR?

ISO 26000, established in 2020, provides an international framework for CSR, outlining the principles and practices companies should follow to ensure their actions contribute to sustainable development. It emphasizes ethical behavior, social impact, and environmental stewardship.

What are some common misconceptions about CSR in Indonesia?

Some misconceptions about CSR in Indonesia include viewing it as a mandatory obligation rather than a strategic business necessity, treating it as a cost rather than an investment, and assuming it applies only to companies involved in natural resource extraction. These views can limit the potential impact of CSR initiatives.

How should CSR be integrated into a company’s strategy for maximum effectiveness?

CSR should be integrated into a company's strategy from the outset, viewed as an investment in building trust and a positive corporate image. By aligning CSR initiatives with business goals and focusing on long-term social and environmental benefits, companies can enhance their reputation and foster sustainable growth.