Corporate Social Responsibility
Corporate Social Responsibility – creates corporate values.
Business is important for improving the welfare of society. As a result of business management, the obligations and legal responsibility of companies towards the state and society arise. If the company fails to meet its obligations, it faces legal enforcement.
Although Corporate Social Responsibility (CSR) includes the word responsibility, it is completely voluntary. It is more of a sense of responsibility and ethics, a social function.
The purpose of a business is primarily to generate income by selling goods, providing services, and so on. But this should not be the only purpose of business. Also, the aim of the business is to contribute to the society with its activity.
By participating in solving social problems, companies create a favorable environment for business, form a positive image, work together with their employees in the realization of corporate social responsibility, and establish relations with other market subjects. This can be in the form of participating in a blood donation drive, taking steps to protect the environment, organizing humanitarian and charity events, and so on.
CSR comes in internal and external forms. Internal social responsibility:
-labor safety and protection;
-fixed salary payment;
-protection of the social and economic importance of wages;
-social and medical insurance of employees in accordance with the law;
-involvement of employees in various training and education programs;
-development of human capital by involving employees in this program;
-help in difficult times.
External social responsibility depends on the following areas of activity:
-sponsorship and charity;
-participation in environmental programs of the country, region and municipalities;
-full readiness of companies to help during a crisis situation;
-reciprocal relationship with the local population;
-production of quality products.
Tax benefits of funds allocated to social projects are also applied. Pursuant to Article 106.1.18 of the Tax Code, an enterprise, department operating in the field of science, education, healthcare, sports and culture that meets the criteria determined by the body (institution) determined by the relevant executive power body, the portion of which does not exceed 15 percent of the taxpayer's profit for the reporting year and organizations, as well as the part transferred to funds created for public and social purposes whose list is approved by the body (institution) determined by the relevant executive authority, for a period of 5 years from January 1, 2024. The provisions of this article are applied only in relation to expenses paid in non-cash manner.
The Corporate Code of Ethics developed by the Ministry of Economic Development and the International Finance Corporation emphasizes the obligations and accountability of companies to treat their employees with respect, not only to the companies they cooperate with, but to society as a whole.
As you can see, corporate social responsibility is not a source of income, but an important factor in business management.