Longing for Corporate Social Responsibility's (CSR) implementing regulation
Wednesday, August 22, 2007 Mohamad Mova Al'Afghani
Now that corporate social responsibility (CSR) is obligated under the new company law (for companies which its core business is Natural Resources or in one way or another related to the environment), business community in Indonesia awaits its implementing regulation. There are still some confusion about the nature of CSR obligation. For example, how should "Natural Resources or in one way or another related to the environment"be defined?
Noke Kiroyan explained this complexities on his article:
Almost as an afterthought, in verbal explanations by lawmakers, those industries producing hazardous waste such as hospitals are also included. What about state-owned and other hospitals that are not incorporated as limited liability companies, as the law regulates this legal form only?Article 74(2) of the Company law specifically stated that the CSR will be accounted as a "cost". This may not be a good news for public service companies which are related to the environment. The cost will be reflected in the price, and thus the price of universal services (such as water and energy) might raise.
Everyone is entitled to make up his or her own definition, but why go to the trouble of doing comparative studies outside the country if we end up going our own merry way?
I'd say that the government must exclude USO companies from CSR obligation in its implementing regulation. I don't think it's a good idea to raise water, electricity and health bills in a country where these services remained poor.
(For a comparison, check also the Investment law's CSR clause)