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SCSR 2.0- Strategic Corporate Social Requirement

Background of the Study

The Roots: History of Corporate Social Responsibility
As every necessity calls for an innovation to solve every
impending problem, Corporate Social Responsibility, a practice which is
known to some as corporate governance, was a brainchild of necessity that
started during the early 90s where the age and philosophy of greed is
instilled in almost every company in America wherein
Reaganomics CITATION Ara10 \l 1033 sole purpose is to promote financial growth in
the company without considering its implications to the society. (Visser,
2011)

Realizing the effects of Reaganomics is a double-edged sword

wherein capitalism propelled organizations to economic growth but its abuse
of resources led to the degradation of the society, the young and future
business owners then held the initiative to curb the prevailing problem and
give back something to the community, realizing that their institution is also
part of the society, and has to take part in nation building. Examples of
these are Microsofts Bill and Melinda Gates Foundation and Warren Buffets

CITATION Ara10 \l 1033 (Visser, The Age of Responsibility: CSR 2.0 and the New
DNA of Business, 2011) It should be noted that during the early 90s, America was
already booming economic superpower. This is largely due to the effect of
capitalism and Reaganomics wherein President Reagan allowed loose enforcements
of laws for private companies to invest and lobby Americas progress to economic
growth leap.

SCSR 2.0- Strategic Corporate Social Requirement

The Giving Pledge, which aims to invite top CEOs to donate sums of
money for the betterment of the global community.

The Phases of CSR

CSR 1.0 Acts of philanthropy and movements were the motto
during those days wherein the establishment and practice of CSR offices are
prevalent in each private companies and the advancement of technology
furthermore progressed the ways wherein volunteerism projects could be
done to help the society. (Friedman, 2005) This would be dubbed as the first
stage of CSR, CSR 1.0, wherein the economic progress of private companies
altogether blinded them from the expenses they have incurred and the only
view of CSR is to promote and empower the people with the altruist
perspective in mind. (Visser, 2011)

CSR 1.5 However, the CSR practice has come into a different
view and perspective since the management has now unveiled that the
establishment of a CSR ups the brand management of the company to the
society even without practicing volunteerism projects eventually spoiling the
real spirit and essence of Corporate Social Responsibility. The 2008 global
economic recession was the inhibiting factor that has put forth the necessity
of economic stability before the instilment and promotion of human growth
inside the organization. The view of labor has now shifted from asset to
expenses, thus making the establishment of a CSR office for better brand

SCSR 2.0- Strategic Corporate Social Requirement

management purposes only, from an altruistic to egoistic view. (Jim, David,
& William, 2010)

This is the present state of Corporate Social Responsibility in the

globalizing and modernizing age. Recent economic, political and social
events inhibited the innovation of CSR to be put into practice again with its
real intent on nation and global community building. (Grant, 2009) CSR
offices are only being put up for the benefit of brand management and
certain benefits that are given by political laws such as tax rebates which is
present today in the Philippine setting.

While other companies have struggled to live up to the demands

of corporate citizenship, several have faltered because of factors such as
economic scarcity that seem to inhibit collaboration between the private and
public sector. The necessity for a new approach to deliver Corporate Social
Responsibility for the spirit of social engineering is imminent since the
private institutions serve as the bonds of the public sector to connect with
the globalizing and flattening world. (Belal, 2008)

Corporate Social Responsibility has now veered away from its

real intent to serve the society through community development efforts and

SCSR 2.0- Strategic Corporate Social Requirement

has now changed to merely a position which does not benefit the society in
promise of its name. CITATION Ara10 \l 1033

The Problem
The Yardstick: Upgrading to CSR 2.0
The problem in the present Philippine corporate setting is that CSR
offices and initiatives are just cover-ups for companies and businesses to let
the society know that they are part of nation building when they are actually
are not. Some companies also declare that they have CSR initiatives just for
the sake of receiving tax rebates so that the company may grow while it
feeds on the resources of the society. It does not also help that CSR offices
does not develop the employees within their organization since it is just a
for show office. This leads to a tragic brain drain that further inhibits
innovation within the country. It is the role of the organization to ingrain its
philosophical values to its employees so that the latter may be the ones to
instigate their own positive change in the society they live in, thus living up
to real corporate citizenship. CITATION Ara10 \l 1033 (Tarrayao, 2013)

CITATION Ara10 \l 1033 (Segerlund, 2010)

CITATION Ara10 \l 1033 (Tarrayao, 2013) furthermore stressed the need for the
present Philippine corporations to pursue innovation in Corporate Social
Responsibility because it is the word Corporate that must be the prerogative over
social responsibility.

SCSR 2.0- Strategic Corporate Social Requirement

Also, the Philippine governments weak financial capability to assist
the people adds up to the situation because it does not offer much rewards
to social workers, thus implying the need of the support of the financially
strong private sector in social engineering. (Aras & David, 2010)
The situation of the status quo in Corporate Social Responsibility
thus boils down to three effects:
1. Development of corporate greed in the private sector.
2. Poor people development in the organization due to lack of focus
in the CSR environment.
3. Stunting of innovation and community development.

The Password: Key to CSR 2.0: Strategic Corporate Social

Responsibility
Since the birth of Corporate Social Responsibility came from necessity,
the key on bringing forth such innovation to tackle societal issues must be
issued by a need itself such as a law.

As legal laws are expressed forms of social norms, the action

plan to instigate strategic innovation within the CSR field should be bolstered
by a mandated law that will require private institutions to practice corporate
citizenship so that the inhibition of ideas will be stopped and growth of
concepts to stimulate partnerships and growth within an organization and

SCSR 2.0- Strategic Corporate Social Requirement

society will be fostered, it would also remind these institutions that they are
operating within the grips of society and thus must answer to the need or
call they are experiencing, for they are also part of the society as corporate
entities.

The Approaches and Situation

In order to tackle the prevailing problem, we must first delve
what are the approaches certain countries, conglomerates and corporations
are using in implementing Corporate Social Responsibility. For an action plan
to be effectively and efficiently met to its standards, it must first analyze
what is the setting and situation where the approach and methods must be
used.

The Setting
In this particular scenario, we aim to bolster and make private
organizations practice Corporate Social Responsibility in the Philippines, a
developing country situated in the Southeast Asia which is abundant on
natural agricultural resources. Furthermore, it is also a populous country
with a dense capital, thus a majority of its manpower is located there. As
such, companies have invested in the countrys large pool of manpower but
at the same time exploiting the natural resources of the country itself. The
problem is that public sector needs more of the private sector so that the

SCSR 2.0- Strategic Corporate Social Requirement

latter could sustain the development of the community. The
service/consumer-oriented business sector of the country is what keeps the
bloodline of the economy pumping, thus the private sector must be
sustained for the public to prosper. CITATION Ara10 \l 1033 The nation cannot solely
thrive on the support of the government, for its efficiency to allocate funds
and enforce law is prevalent on the case of Janet-Lim Napoles. Public-private
partnership is the practice of community building in this
country. CITATION Tar13 \l 1033

The Approaches
Tarrayao (2012), gives an insight on how Corporate Social
Responsibility is practiced in different parts of the globe depending on the
geo-economical state of the nation or company.

Philantropical this ideology of practicing corporate citizenship likely

comes from the Chinese where the economic stability of the
corporation and country itself is safe. They are able to risk and give
scholarship programs, feeding projects and cash out massive expenses
for the society etc. without the need of gaining profit or sustaining it in
the long run.

CITATION Ara10 \l 1033 (Tarrayao, 2013)

CITATION Tar13 \l 1033 (Andrew & Dirk, 2008) (Aras & David, 2010) A plentiful of
nations is practicing this method to alleviate problems on the economic side of
things such as the EU group and ASEAN community. Making the private corporations
engage more on public interaction and community development.

SCSR 2.0- Strategic Corporate Social Requirement

Corporate/Western this practice is highly advanced and is one of the

most revered kinds of practices in Corporate Social Responsibility. It
imbues its employees with the kind of philosophy that will help the
society itself. Sophisticated and highly efficient, this is practiced by
high-end corporations and countries that are well-off.
Strategic CSR this one should be the most applicable of all practiced

CSR. Prevalent in almost all developing countries, strategic CSR aims

on developing the community and sustaining the company itself in
return. Highly sophisticated and classy it aims on nation building
through institution-sustaining.

The Framework
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SCSR 2.0- Strategic Corporate Social Requirement

So, how could a nation like the Philippines alleviate the obstacles
ahead in partnership with the private institutions without giving them all the
expenses to be shouldered?

As seen in Figure 1, (Tarrayao, 2013) suggests that in order for

the institution to sustain the community development projects, since the
nation is equipped to be a consumer and service-oriented economic system,
the public itself must also participate in the community development
programs of these corporations and be a consumer themselves, for a very
fair price until the community is able to sustain the programs themselves so
the corporations could move on to the next community and empower them
as well. As seen, both gears cannot run unless the oil and middle gear of
partnership which is an intangible factor, is present.

Thus, what we are now seeing the present situation is the lack of
initiative from both sides to start the change they want to experience and
deserve. If a mandated law will be the one to provide the spark and push for
the public and private corporations to collaborate, it would be enable both
sides to pursue creativity and innovation for their plans to become concrete
and sustainable, just as Jeffrey Tarrayao has said.

SCSR 2.0- Strategic Corporate Social Requirement

The Action
There are three ways wherein a mandated law that requires the practice
of Corporate Social Responsibility could spark the change.

Innovation and Collaboration Corporate Social Responsibility as a

requirement is not entirely new to the globe. It is being practiced by
developed countries like India and Norway. India, a hugely
populated nation used its human resources as a means to develop
their country. They required the practice of CSR and have been on
top of the world economy since then. Through the collaboration of
both parties, ideas are being born thus bringing out the best

intention of everybody to progress.

SMEs Fighting Chance Tarrayao, in his interview has said that
while private corporations provide the programs, they do not
necessarily are the ones solely instigating it. They are partnered by
several other businesses to support the community thus fostering
partnerships within the private sector which are part of the public
and bringing a chance to small and medium enterprises to have
their business known to the people. A very strategic plan to help
the community while upping the brand of the business and the

overall operations of the community development project itself.

Strategic Corporate Sustainability corporate social responsibility
does not mean that you have to really provide and give. Sometimes

SCSR 2.0- Strategic Corporate Social Requirement

it can also be a means to sustain and gain in your business. Firms
such as Meralco empowers communities by providing electricity to
remote barangays, making their communities as their consumers.
This is exactly the type why Philippines is progressing, due to the
reason that it is consumer-based economy wherein many can be
tapped and it is independent from any investments.

Case # 1: Globe Telecommunications

During Jeffrey Tarrayaos time as a Chief Corporate Social Responsibility
Officer at Globe Telecommunications, he was tasked to take care of the
communities that were under strife during the 2000s wherein cellular sites
of Globe Telecom were being bombed down by the NPA that incurred the
company 75 million pesos in losses. As a strategist, he infused strategy
within corporate social responsibility by providing the communities with
programs and hardware that are supported by Globe Telecom. These
programs like free education through the use of internet provided the youth
to access information with the help of Globe. Other such program is also the,
Isumbong mo kay Kap program which provided public officials with
cellphones to receive reports about the latest happenings and issues going
on at the barangay, which was partnered with a life insurance company. The
reliance of the community to the cell site therefore became imminent and
thus the barangay sought to protect the cell site at all costs because it
became infused in their daily lifestyle.

SCSR 2.0- Strategic Corporate Social Requirement

The overall loss of Globe of 64 cell sites that were being bombed at different
communities has gone down to 4 and of the actual 75 million pesos lost,
Jeffrey Tarrayao only spent 5 million funding the whole scheme. The profits
gained from the consumer based community they had sustained continue to
empower Globe on the other hand. The micro-movement of Globe emanates
through their whole system thus the value of being one with the community
brought not only economic stability but harmonization and empowerment
thru education within the community as well.

Case # 2: Meralco Foundation

Meralco is known to be the countrys premier energy giving agency to homes
and communities. It cannot survive on its own if there is no community to
provide energy to. Confronted with global issues to lower emission of fossil
fuels and lower electricity costs, the company is in dire need to find new
consumers while emPOWERING them at the same time.

Thus, Meralco has gone out the box and looked for remote places that they
could sustain with renewable energy. It became their center for research and
development while powering up their community through electricity.
Eventually, Meralco gave their sources and solar panels to the community
allowing them to sustain themselves and becoming the place of electricity a
nucleus of business and development.

SCSR 2.0- Strategic Corporate Social Requirement

Karaoke machines, computers and small business began to tap on the
renewable energy supplied by Meralco, thus making them consumers and
making the pool of income for Meralco more.

Conclusion: The Minor Glitch??? On CSR 2.0

For many, a mandated law requiring the practice of Corporate
Social Responsibility is not harmful; in fact it is beneficial because it
promotes harmonization of both the goal of the organization and of the
society where they operate, plus bringing the fact that it can too, promote
and progress the growth of the organization which sustains the community.

It gives chance for minor players in the business sector to participate in so

they could be economically stable therefore allowing the circulation of money
smoother and the economy of the country due to investment will boom.
Corporate greed may grow but at least it is doing its part to do something to
the community, its greed towards self-growth will also lead to the
development of the society in turn.

The only minor downside of this is thru ethical concerns wherein the spirit of
volunteerism will become hard to attain since it is required. To rebut, the
purpose of the supposed law is to bring together and foster partnership that
will develop a community. As for the case of Globe Telecom, wherein they
partnered with an insurance company to shoulder expenses and bring the

SCSR 2.0- Strategic Corporate Social Requirement

company to a good name with the community. As for the spirit of
volunteerism, the approach of a strategically corporate social responsibility is
one way to tackle the prevailing problem. They could still resort to
philanthropic activities when they feel that is their way of giving back to the
society.

Thus, the supposed action plan being met warmly by nations and
corporations alike, corporate social responsibility, if approached with the
right measures and strategy in the Philippines would bring progress and
harmonization would among the private and public sector and can be the key
towards a better nation building. BRING ON CSR 2.0.

SCSR 2.0- Strategic Corporate Social Requirement

Bibliography

Andrew, C., & Dirk, M. (2008). The Top 5 CSR Trends for 2013.
Retrieved September 14, 2013, from Crane & Matten Blog:
http://craneandmatten.blogspot.com/2013/01/the-top-5-csr-trends-for2013.html

Aras, G., & David, C. (2010). NGO's and Social Responsibility. Emerald
Group Publishing Ltd.

Belal, A. R. (2008). Corporate Social Responsibility Reporting in

Developing Countries: The Case of Bangladesh. Ashgate Publishing
Corp.

Crowther, D., & Guler, A. (2010). Handbook of Corporate Governance

and Social Responsibility. Gower Publishing Company Ltd.

Friedman, T. (2005). The World Is Flat: A Brief History of the 21st

Century. New York, USA: Farrar, Straus and Giroux.

Gallo, C. (2012). The Apple Experience: Secrets to Building Insanely

Great Customer Loyalty . New York: McGraw-Hill.

Grant, E. (2009). Careers With a Conscience: How to Make Corporate

Social Responsibility Part of Your Job. WetFeet Inc.

SCSR 2.0- Strategic Corporate Social Requirement

Jim, S., David, P., & William, S. (2010). Reframing CSR: Lessons from
the Global Financial Crisis. Unspecified.

Lister, J. (2011). Corporate Social Responsibility and the State:

International Approaches to Forest Co-Regulation. University of British
Columbia.

Praszkier, R., & Nowak, A. (2011). Social Entrepreneurship: Theory and

Practice. London, United Kingdom: Cambridge University Press.

Ratzinger, B. (2009, July 7). Caritas In Veritate. Vatican.

SAGE . (2011). SAGE Brief Guide to Corporate Social Responsibility.

Chicago: SAGE Publications Inc.

Segerlund, L. (2010). Making CSR a Global Concern: Norm Construction

in a Globalizing World. Ashgate Publishing Corporation.

Tarrayao, J. (2013, October 7). Strategic Corporate Social Responsibility.

(J. Cimatu, Interviewer)

Visser, W. (2011). The Age of Responsibility: CSR 2.0 and the New DNA
of Business. Chicago, USA: Wiley Publishing.

Visser, W. (2007). The A-Z of Corporate Social Responsibility: A

Complete Reference Guide to Concepts, Codes and Organizations. John
Wiley & Sons.

SCSR 2.0- Strategic Corporate Social Requirement

APPENDIX
Interview Transcript with Mr. Jeffrey Tarrayao

SCSR 2.0- Strategic Corporate Social Requirement

Credentials:

Name: Jeffrey Tarrayao

Academic Profile: UST AB-Communication Arts
Academic Accolades: Ayala Scholar and Delegate, graduated with latin
honors, held several positions at the freshmen council and sophomore

SCSR 2.0- Strategic Corporate Social Requirement

chamber during his time and as a servant leader at the Communication Arts
major.

Present status: President, One Meralco Foundation

Past professional status: Chief Officer for CSR department, ABS-CBN
Corporate Correspondent.

Professional Accolades: Numerous nationwide Quill Awards for

Outstanding Work on Corporate Social Responsibility and countless
international praises such as the Anvil Awards for his renowned work on
community development.

Setting:

SCSR 2.0- Strategic Corporate Social Requirement

Place: Fish and Co. Tri Noma
Time of Interview: 6:00 PM 9:00 PM
**Note: To reduce unnecessary comments, stories, remarks and
shenanigans made during the interview, the interview transcript that is here
in the research paper only contains what is relevant in the topic at hand.
Also, topics are collated and made concise for better digestion of concepts
and ideas. For the viewing of the whole conversation, the viewer may
contact me @ jyrus_1133@yahoo.com

Me: So, CSR, what do you think of it as a subject and as a profession?

J.T.: When I practiced CSR, it didnt really introduce itself as a service to the
people, it was always strategic to me. It was the welfare of the company
that needs to be the prerogative, thats what makes it CSR. It is the C that
makes it concrete, you know. You have to first start from the inside of the
company before you do the task and output to the community, if your teams
is not imbued with the philosophy and practice of the company, what would
you expect of your action in the community? Inside then out.

Me: Comparing the CSR here in the Philippines and the world, what is your
say about it?

SCSR 2.0- Strategic Corporate Social Requirement

J.T.: I would say that CSR here in the local setting is much more creative
rather than compared to the global stage. It is where the company also
thrives on CSR to make their brand known to the people whereas in the
other parts of the globe, it is philanthropy and instilment of values among
their employees. I have observed that there are three approaches on how
countries and corporations practice their CSR, one is the oriental type of way
where the companies practice CSR through philanthropic activities and
programs, which is staple. The other one is the Western style which is highly
sophisticated which instills values among its employees to instigate CSR
efficiently and effectively and one is the strategic CSR, a developing trend in
todays developing countries wherein the CSR department also finds ways to
up its corporation by fostering relationships with the community, just like
what we did in Globe and Meralco.

Me: How did you implement strategic CSR in Globe and Meralco?
J.T.: I entered Globe Telecommunications then when it was in a time of
dilemma. Globe was not paying the New Peoples Army revolutionary taxes
and most of the cell sites of the industry are being bombed, in Globes case,
64 which incurred the company a total of 75 million pesos of losses. As my
business philosophy, I have gone out of my way in the CSR department to
strategically make a move towards the prevention of those bombings. We

SCSR 2.0- Strategic Corporate Social Requirement

infused technology that can be made available by Globe to the communities
affected by these bombings. With these campaigns, we raised awareness
and the communities themselves solved the problem of the company by
protecting the cell site which has now become a vital part of their lifestyle
because it provides them information thru education, community building
and business in the case of sari-sari store and many more.

As for the case of Meralco, MVP personally called me in to be the head of

Meralco because it was undergoing a major revamp. The boss wanted me to
instigate corporal social responsibility programs that would have a relative
implication or relevance to the company instead of conducting feeding
programs which is not really relevant to the company.

Under my tenure, we searched for remote barangays and provided them

with electricity to empower them, which is really the philosophy and practice
of Meralco. By providing renewable energy, we brought them the basic needs
of a community, a continuing education to bring them progress in the future,
a business hub for small time businesses to start and many more. Thus, the
vicinity itself became the nucleus of the community. Development of the
people

SCSR 2.0- Strategic Corporate Social Requirement

ME: Im really interested in being a contributor to CSR, are there any
requirements with regards to that?

J.T.: There are, you must be articulate but it can be simple at times. I asked
my team to write a resume for me, and at first they were afraid! They
thought I was going to fire them because of their lack of knowledge. A few
more years after, I told them to compare their resumes today and the past
and to their surprise, the previous 1 page back-to-back resume became a
four page resume. You see, it is not really about being smart, it is also about
people development, honing their mind frame to really give their all to the
people so a cycle and progress would develop the country in return.

ME: What is your opinion on CSR being a requirement mandated by law?

J.T.: Its okay for me naturally. I think Norway and India has practiced it for
some time now and look at them, they have come this far. It is really a must
for private corporations to engage in these kinds of things because they are
part of the society as well. There is no downside in engineering the society,
you will receive all the help you need from tax rebates, brand management
to collaborations the volunteerism issue must not be fussed since even a
small act of initiative counts, and I believe one act counts even for a year.