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It pays to do good

By Gerry Baclagon |

Many corporations are integrating corporate social responsibility or CSR into their business strategy to give something back to the community. According to business consultant Efren Cruz, CSR encompasses the obligations and responsibilities of business to society, and that in the pursuit of the profit motive, its corporate acts and strategies should include committing itself to protecting the environment, upholding workers’ rights, and improving the quality of life of its community and the society at large.


CSR gained momentum in the last decade as consumers, the media, activists, and various groups started demanding that companies contribute to the betterment of society. “Businessmen must accept that they have an obligation to society in the same level as politicians,” says Cruz, author of Setting Frameworks: Family Business and Strategic Management. “This demand is based on the fact that businesses are now institutions as powerful as governments.”


Indeed, the business sector plays a big role in determining wages and commodity prices, among other things, but it has frequently been criticized for contributing to air pollution and environmental degradation, among other sins. Cruz says the business sector is obliged to help protect the environment, ease poverty and unemployment, support education and the arts, finance basic research, and contribute to urban planning and development—areas that used to be the government’s sole domain. “The doctrine of corporate ethical behavior and social responsibility states that in the pursuit of a reasonable return on investment, business firms must behave as good citizens,” says Cruz.



Still, it’s not solely the big corporations that must commit to CSR. “You don’t have to be big to practice social responsibility,” says Tita Datu-Puangco, head of Ancilla Enterprise Development Consulting. “A [small or medium enterprise’s] most important responsibility to society is providing quality products and services and continuing to improve that quality.” Indeed, small and medium enterprises have a big role to play in developing society because they make up 99.6 percent of all businesses in the country, contribute 32 percent to economic output, and employ 69.9 percent of the labor force.


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