Corporate Social Responsibility A Comprehensive Review

The term, understanding, and understanding of corporate social responsibility / Corporate Social Responsibility (CSR) for this still always be a warm pedebatan by supporters and opponents. Both views are different pole each having opposing arguments against one another in accordance with the position and interests.

One of the sharp differences that exist among others, is related to:
– Is Corporate Social Responsibility / CSR that is in the realm of ethics (business ethics), or should be in the realm of law?
– Does CSR need to be regulated in the legislation or do not need to be formally accompanied by strict sanctions?

Supporters and opponents of CSR basically have their respective reasons, because the background objectives and targets that differ in opposite interests.

Proponents of regulation and implementation of CSR concepts clearly and forcefully, argued that CSR is actually for the benefit of man and humanity, so it must be set out clearly and firmly. While from his opponents, stating emphatically do not need to be regulated, give it to the perpetrators.

In the future, Corporate Social Responsibility, if implemented properly, will give positive impact for the company, the environment, including human resources, natural resources and all stakeholders in society. Companies that are able as an absorber of labor, has the ability to provide increased consumer purchasing power, which directly or indirectly, to realize the growth environment and so on. Given the simultaneous nature of the company, then the existence of companies that obey the environment will be more meaningful.

Basically every company activities relating to natural resources, must contain a positive value, both for internal and for external companies and other stakeholders. Despite this positive value it can encourage actions and deeds which ultimately has a negative value, because of adverse environmental, community or other communities more widely. Negative value in question is how far the activities of the company concerned has the potential to harm the environment and society. Or how broad environmental company occurred as a direct result of corporate activity.

Companies that on one side at a time into the center of activity that brought prosperity and even prosperity for the community, at the same time one can be a source of disaster in the same environment. For example environmental pollution or even cause environmental damage to natural and other, more widely.

The questions that arise are:
– Does the company’s presence in the community, containing positive and negative values are quite balanced, so that between the benefits and deficiencies do not cause problems for the community as stakeholders?.
– What is the balance between corporate interests and the interests of society fairly balanced and fair? And what is its criterion?
– Will the existing regulations relatively well set to achieve balance?.

So the company will have a positive impact on life in times to come with maintaining the environment and all stakeholders’ interests on the other so will result in a better way of life. Instead the opponents of the regulation and implementation of a formal CSR believes if these responsibilities should be formally regulated, accompanied by sanctions and enforcement of real. It would be a burden the company. Expenses will be borne by the company eventually society as stakeholders. Therefore, CSR is very correct when fixed as a moral responsibility, with all its consequences.

Indonesia as a developing country and as an international investment destination countries as well as the State of destination marketing of products from developed countries, aware that the very nature requires the regulations to give protection to domestic interests.

One that has been done by the Republic of Indonesia, in order to protect the environment and ecosystems in general of efforts to use natural resources to be maintained properly, ie with the provisions of CSR include them in Article 74 of Law No. 40 of 2007 on the new Limited Company.

Since the bill has emerged PT socialized views which contradict each other, between supporters and opponents. The concept of CSR, polemics emerging from two opposite interests. After more than one year of the enactment of Law Number 40 Year 2007 regarding Limited Liability Company, appeared more “resistance to the provisions of Article 74 of Law of Limited Liability Company.” It is characterized by the existence of an entry cancellation of the article to the Constitutional Court. Opposition is based on a calculation of business, namely the burdens to be borne by the company. With the burden of social responsibility, companies, employers will have a new, heavier loads, because the provisions are so binding that must be implemented properly.

Based on the ideas mentioned above, there can be 2 (two) following possibilities:
First, employers will look for a new compensation with an alternative to exploitation of the environment more effectively and efficiently again with all its negative impacts.
Second, employers will be more careful again not violate the provisions of law which has legal and economic risks.

The first option, would be taken if the economic calculations become very dominant and a chance for that big chance. Likely to cause the load on the natural becomes greater. That requires the supervision of law enforcement with an extra tight and alert. However if the second possibility occurs, will increase the burden of consumers, but secure for the company and the environment.

B. The existence of the Company and its Environment

Basically, the company is a public organ that has several functions that are important for the stakeholders in general:

1. Companies must always meet the needs of society, from the needs of primary, secondary and even tertiary to the needs of any kind.
2. The company is able to absorb labor force and open new jobs.
3. The company is an agent of renewal and application of science and technology the most efficient.
4. The company doing the marketing of goods and services needed by society.

Thus it can be said that the company’s presence is needed and have a very important value to society in general and the development of society itself. So without organs, which in this case a company that has these functions, the society can not be not be accepted, whether the organ for survival of society itself. However, how good and important company, still has two different sides.

Company as an organ of society has two positive side and it is important to the life and future of humans, especially in realizing the common welfare. But it also has a negative side, which cause negative impacts on many things. From the positive side the company capable of doing many things, among others:

First, the company has always offered the needs of society with all the concepts of innovation, which in turn will encourage the renewal and adopt a sustainable development of science and technology and continually creating the common welfare.

Second, the company is one of the centers of economic activities in the community who are able to create new jobs, and also able to bring new prosperity.

From the social and economic aspects, it is clear where the existence of the company (whatever form and status). But from the legal aspect of the existence of companies still need the main thing is the legality of the law.

Legality of the Company referred to include: must be met are:

1. Institutional legality, ie the requirements that must be met for enterprises, whether legal status or not, must meet the requirements and procedures pursuant to applicable law, so that the institution legally valid.
2. Legality of operations, namely the requirements that must be met for the enterprises in question, both legal entities and legal entities to conduct activities for the company (to operate legally.)

C. Corporate Social Responsibility as a concept

The journey of human life and humanity a long, ultimately producing a human wisdom and civilization of humanity and the environment respectively. From the journey of civilization, arrived at a basic thought and wisdom that:

First, that the earth together and as a place where life is a place that already at the limit the ability to accommodate fully the interests of mankind, especially in the long term future.

Second, the natural resources that have been exploited becomes increasingly eroded and depleted at the limits of nature itself, because it is not accompanied by an effort kebaharuan. And also because it can not happen kebaharuan, because of the nature.

Third, the development and advancement of science and technology do not always have only positive effects, but also have a negative impact, including on natural breeding. So there is an imbalance between demand and availability of natural resources in general. Between the progress of science and technology and its utilization as a whole.

Based on the three issues, it is questionable as well, what should be done to protect the planet from human greed and the development of science and technology?.

What should be done and who should conduct an in-depth reflection?. Meditations both the layman, the world of science as well as business and corporate world. Should the three elements synergize to overcome the difficulties together.

The tradition that emerged was that overcome natural difficulties and the threat is only done by community groups, which eventually gave birth to local wisdom. Local wisdom that appears to continue to grow into a wider wisdom, or extinct by itself.

Humans as beings who understands, develops the concept of responsibility on the basis of a basic question as well, who must be responsible for each environment?.

Starting from the concept of personal responsibility, that every person should be responsible for all acts, then Article 1365 Civil Code, be sufficient, that whoever is responsible under the law (Article 1365).

Article 1365 as follows:

“Any unlawful act that brings harm to another person requires that any person whose loss was his fault issue, replace these losses.”

There is one basic concept of responsibility is still in the private sphere. Progress is happening is that certain responsibilities be collective responsibility (joint responsibility).

At a subsequent period the concept is to shift the responsibility of the corporation, because it is straightforwardly proven korporasilah conducting legal act detrimental to third parties.

Corporate social responsibility is basically a natural thing when starting from a basic understanding that the company is an organ of society. As an organ, a company must have a positive impact and negative.

The issue becomes difficult, because not all parties, all companies and all stakeholders with a conscious to always be responsible for any consequences that have been done.

Morally and legally (civil and public) any legal person responsible for the actions of all things legal. No one has the freedom not responsible for the legal consequences of legal action. In this case the company is a subject (the subject of Legal / Legal).

Activities undertaken within the corporate community also contains two positive and negative. At the time, and all corporate activities is to meet community needs and or request, then the activity is considered positive. However, the activities carried out could cause a negative impact if it has bad consequences for the environment and the factors of production to another. The emergence of the negative impact that is necessary and must be regulated so as not to harm the community environment and stakeholders.

Corporate Social Responsibility (CSR), basically started from a sense of personal responsibility in a business environment, which arise from individuals who are sensitive to each other. That feeling is arising and developing as something to be done given the gap of sharp social and economic conditions, the labor element with the element of owners and managers in the business world.

Departure from these circumstances, the birth of the concept of Corporate Social Responsibility that is on target moral obligations. From the moral obligations that move between the well-being in certain environment, lead is also a concept that must be realized is the common welfare. This is just to reach the common welfare in their respective corporate environments. Welfare is limited, more and more widespread, followed by the same movements that became a positive concept of institutional responsibility. In this case the application of CSR needs to be done which includes an implementation to apply:
– Minimum Wage deserve to live comfortably.
– Safety work enough to protect labor.
– Social security is appropriate for future employees and their families properly.

Concept on a very humane for workers, the company’s future. Meskipn Thus was born the new developments on the awareness about nature and the environment.

The concept as described above then becomes something that is based on human wisdom, not only a moral obligation, but a duty whose objective towards achieving the welfare of its citizens, must consciously regulate matters relating to CSR.

Natural resources are exploited more and firms became increasingly reduced its carrying capacity, due to its limited and not renewable. This is starting to realize that the concept of environmental responsibility is also growing. Human privately within the institution and the State simultaneously aware that the environment and natural resources need to be protected for the benefit of man and humanity in the future.

D. Setting Corporate Social Responsibility

Formally, the new Corporate Social Responsibility organized in 2007, namely in Article 74 of Law Number 40 Year 2007 regarding Limited Liability Companies as follows:

(1) of the Company who run their business activities in the field and / or related to the natural resources required to implement the Social and Environmental Responsibility.

(2) Social and Environmental Responsibility as referred to in paragraph (1) an obligation of the Company is budgeted and accounted for as expenses of the Company that implementation is done with due regard to propriety and fairness.

(3) of the Company that do not implement the obligations referred to in paragraph (1) be sanctioned in accordance with the provisions of the legislation.

(4) Further provisions on the Social and Environmental Responsibility regulated by Government Regulation.

In the official explanation by Act No. 40 of 2007 regarding Limited Liability Company stated that paragraph (1) Article 74 contains the mean:
– This provision is intended to keep creating the relationship of the Company which are harmonious, balanced and in accordance with the environment, values, norms and culture of the local community.
– What is meant by “the Company which runs its business activities in the field of natural resources” means a corporation whose operations manage and utilize natural resources.
– What is meant by “the Company which runs its business activities relating to natural resources” means a corporation that does not manage and does not exploit the natural resources, but their operations have an impact on the functioning ability of natural resources.

As for paragraph (2) and paragraph (4) are considered self-explanatory.

Paragraph (3) given the following explanation:
– What is meant by “be sanctioned in accordance with the provisions of the legislation” is subjected to all forms of sanctions prescribed in the legislation concerned.

From the provisions of Article 74 of Law No. 40 of 2007 regarding Limited Liability Company and its explanation of the above can be interpreted that:

– Provision is “only” applies to businesses that move, and have a relationship with Natural Resources. What about other businesses that indirectly also have a negative impact on the environment?.

– How business strata that are in a large number of SMEs with the impact that exceeds a Limited Liability Company?.

It is necessary for any of the following:

– To socialize create a more operational guidance, so as to avoid the impression that a discriminatory law.

– To socialize deep to business entities as businesses that are not included in the definition of Article 74 of Law of Limited Liability Company participated voluntarily maintain a business environment, customer environment properly, given their much larger number with the company reach a far more wide.


Law Number 40 Year 2007 regarding Limited Liability Company.
Law No. 23 of 1997 on the Environment.

Corporation has a great influence as a part of the society, for that reason only, the existence of a corporation will of always be apparent in the society. Corporation has a dual function in the society, first it will from supply the society with primary, secondary and tertiary needs, secondly Corporation has the function as the employment agent, Because the corporation needs workers to maintain Their operations. To fulfill the society’s need, corporations exploit both nature and people, that exploitation Could Be harmful and created positive and negative impact toward nature and people. To protect both nature and people from those impacts, a set of legal rules created Should Be in order to force corporations to developed corporate social responsibility into practice themselves. Tat corporate responsibility is moving from a moral responsibility into their legal responsibility.

Sri Redjeki Hartono, Professor of University of Diponegoro.

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One Comment to “Corporate Social Responsibility A Comprehensive Review”

  1. terimakasih atas komennya.
    kami berusaha untuk hal tersebut dengan melibatkan masyarakat umum yang peduli dan akan membina kerjasama dengan masyarakat dalam hal pengawasan pengadaan barang/jasa atau pelayanan publik.

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