The achievement of the Indonesian Prosperity Index at the end of 2016 needs to be appreciated and become a reflection of us all. Based on research results from the Legatum Institute, a British think tank, the Indonesian Prosperity Index increased from 69th place in 2015 to 61st out of 149 countries in the world. However, there are still red points that need to be improved, especially in relation to the quality of the economy, education and health services in the context of equitable and sustainable social development. This red value has always been the base of social exclusion.
In accordance with the triple helix social development concept (Etzkowitz, 1993), government and companies play a key role in efforts to promote more inclusive social development. In this case, corporate social responsibility (CSR) is a platform that presents strategic opportunities in strengthening synergies between the government and the private sector to achieve inclusive development.
In his book titled Tackling Social Exclusion, John H. Pierson defines social exclusion as a process that prevents individuals, families and communities from the opportunity to get the resources needed to participate fully in social, economic and political activities in society.
In relation to poverty and inclusive social development, two things need to be emphasized. First, social exclusion arises from conditions of poverty in the form of low income and education. Second, social discrimination on access issues. If left unchecked, social exclusion can continue to grow and lead to an increase in the poverty rate. Through this process, individuals or groups of people are cut off from the services, social networks, and opportunities that most other societies enjoy.
Realizing this reciprocal relationship, inclusive development is a strategic idea that is expected to reduce social exclusion and poverty. Therefore, various development efforts must be focused on the root causes of poverty, such as economy, education, and health.
Corporate social responsibility must be grounded in social and environmental aspects (Elkington, 1994). This is inseparable from the assumption that most of the impacts caused by companies have changed the way of life of the surrounding community which also affects their livelihoods. For example, indigenous peoples’ rights to forests as a source of livelihood can no longer be utilized if the forest is exploited by plantation companies.
Therefore, through ISO 26000, companies around the world have agreed to carry out CSR more strategically in their daily operations, one of which is through points on human rights and community empowerment. This point appears as a response from the company’s responsibility to the communities around its operational areas so that the community can also benefit from the company’s operations.
From the explanation above, CSR according to ISO 26000 is an important strategic aspect that is carried out by companies to the surrounding communities. Thus, it is hoped that a good relationship will occur between companies and its surrounding communities which can provide benefits for the company, namely through recognition and social license from the community. Therefore, business continuity and sustainability can run well.
Basically, the biggest responsibility for inclusive development rests on the shoulders of the government. In accordance with its role as a policy maker, the government continues to seek ways to realize more inclusive development in the welfare of society, as mandated in the 1945 Constitution.
To benefit the community
One of the ways that the government can do is by ensuring that the private sector contributes to development. Through the CSR platform, the company’s role in this is to ensure that its business practices do not cause social exclusion in the surrounding community. Furthermore, companies are responsible for minimizing and mitigating negative impacts on the physical and social environment around its operational areas.
At the same time, these efforts must be accompanied by supervision from the government as the party that ensures that the presence of the private sector can bring benefits to the surrounding community. Currently, the government’s efforts to regulate private contribution can be seen from the promulgation of regulations related to corporate social responsibility or local laws and regulations regarding CSR. However, the existence of this regulation must be examined further so that the meaning of private contributions to development does not go wrong and does not only become a formality in the form of financial contributions.
Opportunities for strategic collaborative strategies between the government and companies should be explored, by aligning the government’s development agenda with company business practices. This joint development planning must emphasize the existence of a collective understanding of specific development goals. In this regard, the development of a road map that contains the division of responsibilities between the private sector and the government can be a testament to the commitment of both to achieve inclusive development.
In the end, it requires commitment and high awareness of the importance of strategic collaboration between the government and the private sector. Communication and coordination aspects are important for building this commitment and can be fostered through activities such as regular meetings or group discussions.
A well-nurtured communication is expected to help both parties understand the form of company contribution that is most in line with the government’s development agenda and in accordance with the company’s vision and mission.
Aziz Fasya was a Consultant at Kiroyan Partners and Master of Social Development Management from Sociology, FISIP UI.
Source: Kontan, April 18, 2017, page 23.