To encourage companies to volunteer help during COVID-19, the “Corporate Social Responsibility Act” was proposed and approved on May 21, 2020. Recently, House Deputy Speaker Wes Gatchalian has decided to add several perks to the bill to motivate enterprises in their corporate social responsibility (CSR) efforts.
The bill will allow stock corporations to retain surplus profits in excess of 100 percent of their capital stock for corporate social responsibility projects and programs approved by their respective Board of Directors. The Department of Trade and Industry (DTI) will also be mandated to reward business establishments for outstanding CSR initiatives.
CSR, as defined by the same law, is “the commitment of business to contribute on a voluntary basis to sustainable economic development by working with relevant stakeholders to improve their lives in ways that are good for business, sustainable development agenda and society at large.”
It is a very important part of the sustainable culture as it reminds corporations to balance their need for profit with their need to contribute to society. Besides pushing employers to come up with socially conscious practices, CSR also helps in employer branding and motivates employees to become more productive in supporting the company.
With the approval of this law, social responsibility will not just be an afterthought, but an integral part of running a corporation in the Philippines.