Corporate Social Responsibility CSR 2021

CSR 2021 New Reality

New Responsibility

COMMENT

Giving Has Become Even More Precious Both CSR practitioners and researchers expect companies to profoundly reconsider their CSR strategies in the post-pandemic era and to interlink their personal goals with those related to the UN Sustainable Development Goals.

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t is no secret that the COVID-19 global pandemic has had a profound impact on the globalbusinesscommunityanditsrelations with global and local surroundings. Pressed by the cost of the continuing crisis, countries around the world have decided to open up to the business world and seek support. Indeed, in many countries – Serbia included – numerous companies rushed to support healthcare systems in providing essential equipment and medication. More than half of all companies in Serbia report that the crisis has had a major impact on their finances and operations, while the remaining companies assess its impact as medium. Regardless of these sobering statistics, most companies did their best to channel their CSR activities toward those who are most in need.

This unprecedented crisis has affected both consumer behaviour and company practises. Consumers changed the way they use their spare income and spare time, taking the opportunity to reconsider their values, priorities and sentiments in buying products and brands.

These changes have important consequences for companies. In the face of these new consumer trends, they will need to adjust

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their strategic decisions. Numerous companies have already decided to use corporate social responsibility (CSR) to demonstrate their commitment to fighting against COVID-19 and alleviating the negative consequences of the pandemic for their stakeholders.

Both CSR practitioners and researchers

and environmental challenges. This will come as a consequence of the changes in consumer preferences, as the people demand action that is more meaningful and ethical. This, for example, means interlinking CSR activities with sustainability and the UN Sustainable Development Goals. In a more straightforward way, consumers expect companies to respond toboththeglobalandlocalthreatstoeconomic, social and environmental sustainability that have been imposed by the COVID-19 outbreak.

Such a situation may create space for some improvements in domestic legislation governing CSR, specifically food donations,

Consumers expect companies to respond to both the global and local threats to economic, social and environmental sustainability that have been imposed by the COVID-19 outbreak expect companies to profoundly reconsider their CSR strategies in the post-pandemic era.

Our interlocutors, as well as their colleagues elsewhere around the world, expect that the experiences of the COVID-19 global pandemic could lead to changes in consumer psychology and behaviour, especially in terms of the central role that CSR can play in reconstructing business opportunities and international economies.

For example, it is expected that companies will put much more effort into shifting towards more genuine and authentic CSR that contributes to addressing urgent social

which it seems could be needed even more once the full weight of the economic crisis hits.

As pointed out in our publication, it is estimated that the value of food donated on the Serbian market currently amounts to a value of 525.6 million dinars. If VAT on food donations were to be abolished, donors would increase their contribution by almost a third.

Translated into meals, this would mean an additional 1.2 million meals.

This topic was debated with decision makers at the height of the pandemic, but it remains to be seen whether the proposal will be adopted. â–

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INTERVIEW COMMENT

NEVEN MARINOVIĆ, CO-FOUNDER AND DIRECTOR OF SMART KOLEKTIV, EXECUTIVE DIRECTOR OF THE RESPONSIBLE BUSINESS FORUM SERBIA

Focusing Attention On Sustainable Operations W

We are witnessing changes to values, behaviour and priorities in all aspects of life, as well as in interactions between businesses and the society and communities in which they operate.

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ithout a shadow of a doubt, and without competition, the Coronavirus pandemic marked all aspects of life in 2020, including the domain of CSR activities. “We are aware of how negatively it has impacted on society and the economy, especially certain segments of the economy, the health system and individuals,” says Neven Marinović, Co-founder and Director of Smart Kolektiv and Executive Director of the Responsible Business Forum Serbia.

Companies first had to focus massively on the safety and health of employees, both physical and mental, which is certainly a positive trend, andmanyoftheseexperiencesandpractiseswill continue being applied even after the epidemic ends, notes our interlocutor. On the other hand, as he explains, companies have - like society as a whole – reconsidered their business practises, but also their priorities in doing business. We can state unreservedly that companies will pay much more attention to topics related to sustainable business in the future, because it is now much clearer to everyone how important it is to preserve ecosystems that are already significantly damaged, to turn and direct the majority of business towards the local level, which includes local suppliers and partners, but also to support society as a whole and the support systems that are essential to us, such as healthcare and social care.

Alongside some global initiatives – such as the roadmap to achieve the UN Sustainable Development Goals, the manifesto of the World Economic Forum in Davos that calls for more responsible capitalism, and the new measures of the European Commission aimed at combating climate change – we can definitely expect these topics to be in the spotlight even more.

When it comes to the tangible engagements of companies in the period ahead, future investments in socially responsible projects will be influenced greatly by the epidemiological situation – by its seriousness and duration.

Most companies that don’t have endangered operations aren’t planning to abandon their activities to date related to engagements in the community,emphasisingthatsuchengagements should be strengthened during times of crisis.

What do you consider as the key characteristics of company donations directed towards responding to the pandemic?

According to the annual questionnaire Better Business for a Better Society, which was conducted again this year by the Responsible Business Forum, under the scope of the Project to Improve the Framework of Donations that’s implemented by the Charity Coalition with the support of USAID, 95% of surveyed companies were involved in supporting the community during the crisis, with the aim of preventing the negative consequences of the pandemic.

This support came mostly in the form of monetary donations, but we could also see a significant share of donations in products.

Companies also provided support in the form of the provision of pro bono services, through the launching of special projects to support small and medium-sized enterprises and with campaigns calling for responsible behaviour.

The surveyed companies donated an average of around seven million dinars to mitigate the negative effects of the pandemic, based on data collected until the end of June this year, while the largest amount of an individual donation recorded was 54.4 million dinars. Almost half of the recorded amount of donations was intended for direct support to the health system (RHIF and health institutions), while the other half was directed towards the support of local governments and local and national organisations dealing with humanitarian work, as well as institutions of social protection.

Organisations that deal with the topic of CSR and companies have been advocating for a long time for the introduction of stimulating legal measures, such as the abolition of VAT on food donations. This partly occurred during the pandemic. Is there space for this kind of change to become a permanent solution?

It was made possible during the state of emergency to donate goods/equipment without paying VAT, for those donations that were sent to healthcare institutions. Most of the companies that we had an opportunity to talk with assessed the implementation of this mechanism as being good. However, it seems that the wider coverage of donations with this measure was lacking, bearing in mind the current needs that have emerged in the wider community and the increased need, among other things, for food donations.

When it comes to food donations, this is a long-term issue that relates mostly to support for the most endangered sections of society, but it also has a great impact on environmental issues and the efficient use of limited natural resources. It is a known statistic that a third

the date of expiry. This certainly isn’t the case in the countries of the European Union, which resolved this issue by adopting the Guidelines for food donations and currently 20 of the 27 EU member states do not charge VAT on food donated before its date of expiry.

Analysis conducted by the Forum for Responsible Business, on behalf of the USAID-supported Charity Coalition, shows that the social benefits of abolishingVATwould greatly exceed the potential social costs. The current value of food donated on the Serbian market is estimated at 525.6 million dinars, but with the measure of abolishing VAT this total would increase by almost a third, i.e. to an amount close to 700 million dinars. If we view this increase through the monetary value of one meal, it could mean an additional 1.2 million meals.

The Responsible Business Forum and Smart Kolektiv have been awarding the Volunteering Award since 2011. An invitation was announced on the eve of 5th December, International Volunteer Day, while the awards will be presented in March 2021. of food is destroyed globally, producing up to eight per cent of all greenhouse gases.

The amount of food destroyed in Serbia is measured in the billions of dinars and has a value ten times that of food that is donated, and one of the reasons for that is the lack of a stimulating fiscal framework.

The situation at present is such that it pays off more for businesspeople to wait for the expiry date of food to pass and to send it for destruction than it does to donate food prior to

We have also presented this proposal to decision makers, and we are hopeful that there will be room to continue the dialogue and for this proposal to be adopted in the near future.

You also advocate for the abolition of the taxable amount of scholarships for pupils and students, and in the previous period you had your first discussions on this topic with the Ministry of Finance and the Tax Administration.

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INTERVIEW The minimum non-taxable amount for scholarships that are awarded to pupils and students was increased from 11,741 to 30,000 dinars with the adoption of amendments to the Law on Personal Income Tax in October 2019, and it was subsequently adjusted further, in February 2020, and currently stands at 30,570 dinars.

This is one of the significant achievements that came as a result of joint work with the Council for Philanthropy, which was established by the Prime Minister of the Republic of Serbia within the previous mandate, and included – in addition to the aforementioned ministries – organisations gathered in the Charity Coalition comprising the Ana and Vlade Divac Foundation, Trag Foundation, Smart Kolektiv, Catalyst Balcans, the Forum for Responsible Business, the Serbian Philanthropic Forum and the Chamber of Commerce & Industry of Serbia, as initiators of this initiative.

Which measures are essential when it comes to motivating more companies and wealthy individuals to help society?

The transparency of information and strengthening of mutual trust are prerequisites for establishing lasting partnership relations among all stakeholders in society. For example, when it comes to companies, under amendments to the Law on Accounting, which came into force on 1st January 2020, large companies with over 500 employees are required to report on sustainability, which represents a significant indicator of the quality of operations and, thus, the building of trust and the impact a company has on society. In this sense, the impact that companies have on society will also be an increasingly important measure for the financing of activities, but also for the market preferences of consumers.

What seems to me to be an essential measure is to work on the systematic recognising and evaluating of good practises, the more strategic positioning of responsible and sustainable operations in our country’s development agenda and the building of a general consensus regarding priorities in which to invest. It is with this objective in mind that the Forum for Responsible Business has launched a consultation process with the business community that has the idea of advocating for the initiation and adoption of a new sustainable business agenda. When it comes to sustainable development, the priorities for

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the business sector - according to research into the attitudes of the business community - show that we have a number of topics that need to be worked on systemically. When it comes to people, these are: the hiring of young people, training and educational courses for professional occupations, working inclusivity of persons with disabilities, health and safety at work, as well as reducing inequality and poverty. When it comes to environmental protection, the challenges and opportunities for advancement relate to the management of waste and chemicals, energy efficiency, efficiency of the use of natural resources in production and consumption, as well as the quality and availability of water.

existing relationship with its employees, so this relationship already exists and is further regulated by internal policies that define when and how employees can dedicate time to a social goal, with the company’s support. However, we are also seeing the emergence of new ways of engaging, such as expert volunteering and remote online volunteering, which remain unclear in the legal sense. On the other hand, a clear distinction needs to be made between volunteering and internships, which have been rendered almost equal in some professions.

There are numerous reasons why organisations have pointed out the need for a more stimulating framework for years. However, progress has also been made in that domain this year.

The amount of food destroyed in Serbia is measured in the billions of dinars and has a value ten times that of food that is donated, and one of the reasons for that is the lack of a stimulating fiscal framework This is a time when many people worldwide have volunteered to help their compatriots and other people to overcome the pandemic.

Our Law on Volunteering has been criticised on multiple occasions due to its inappropriate solutions. How much does this result in volunteering, as a form of CSR, suffering?

The whole society suffers due to an inadequate legalframeworkforvolunteering.Unfortunately, volunteering through the legal framework is not valued and recognised as a universal value that should be nurtured and encouraged, rather the emphasis is placed on the prevention of abuse.

Corporate volunteering is based on a company’s

After almost a decade of implementing the Law on Volunteering, the Ministry of Labour, Employment, Veterans and Social Affairs has formed a Working Group, and we have taken on active participation in its work. An ex post analysis of the effects of the implementing of thislaw,whichwasconductedwithinthescopeof the mandate of this working group - comprising representativesofstateinstitutions,civilsociety organisations and trade unions - showed that the law needs to be amended, so we now expect the forming of a new working group that will work in detail on ex ante analysis and the proposal for amendments to the law on volunteering.

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BUSINESS

LIDL SRBIJA

For A Better Tomorrow

Corporate social responsibility is an important part of the corporate philosophy of Lidl Srbija

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he company’s responsibility motto is “For a better tomorrow”, and it is in accordance with this that Lidl bases its activities on five pillars of responsibility: assortment, employees, environment, society and business partners, through which the company ensures that high quality is affordable, while advocating for the well-being of everyone who comprises the society, achieving long-term partnerships, taking care of its employees and preserving the natural environment.

REset plastic With a desire to preserve and improve the environment in which it operates, a special segment of Lidl’s responsibility is accounted for by a responsible attitude towards the natural environment, through a reduction in environmental pollution and the saving of energy and natural resources.

thicker than 50 microns, which are durable and suitable for multiple use, have been introduced in other cities.

• REdesign - the use of more responsible packaging is reflected in Lidl’s international commitment to reduce the percentage of polymeric materials in products of its private brand by 20% by the end of 2025.

Another goal is to ensure all Lidl brand plastic packaging is recyclable by the end of 2025.

• REcycle - directed towards increasing the use of recycled plastics, this area encompasses continuous increases in the share of recycled plastic products in the Lidl range. Thus, at Lidl you can find products like Crivit sports shoes, which are made from plastic collected on beaches and coastal areas, or winter jackets that have a stuffing made from recycled bottles.

• REmove - implying the removal of waste from nature. The aim is to protect natural resources through the active removal of plastics. In accordance with this, together with partners from the Mountain Rescue Service and company Ekostar Pak, Lidl has organised the cleaning of Nature Parks on four Serbian mountains.

• REsearch - encompassing the area of encouraging environmental innovation and education. The Lidl market has introduced reusable 30-degree machine-washable bags that can carry up to five kilograms of the customer’s favourite fruits or vegetables.

Given that plastic waste is becoming an ever increasing problem for the planet, Lidl is implementing the measures of REset Plastic, the international strategy for plastics that was launched in 2018 by the Schwarz Gruppe

Given that plastic waste is becoming an ever increasing problem for the planet, Lidl is implementing the measures of REset Plastic, the international strategy for plastics that was launched in 2018 by the Schwarz Gruppe. Within the scope of this strategy, activities are focused on five areas of action: • REduce - reducing the use of plastic, which implies the withdrawing of plastic bags from all Lidl stores in Belgrade in early 2020, while bags

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REmove - activities to clean mountains in Serbia The goal of the initiative for cleaning Serbia’s mountains, implemented this autumn, is to preserve the environment and natural resources.

Apart from cleaning up waste that endangers our nature, we also strive to educate citizens and raise awareness of how to reduce waste, how to properly dispose of it and successfully recycle it after it is removed from nature, in accordance with the phrase “Reduce, Reuse, Recycle”.

Lidl launched this action on Mount Kopaonik. Volunteers removed waste from nature on the slopes of the National Park, one part of which has the highest concentration of accommodation facilities and cable cars, and thus a large fluctuation of visitors and, accordingly, a large amount of waste that they leave behind. This endeavour resulted in the

collecting of as much as 45kg of waste.

The next cleaning operation was organised on the Balkan Mountain, Stara Planina. Volunteers participating in this action met up at the Mountain Lodge on the Pirot side of the mountain. From there they headed to Zavoj Lake, only to continue cleaning in the area towards the popular excursion areas of Rosomački lonci and Tupavica Waterfall. The action yielded around 20 kg of waste for recycling.

Fruška Gora was cleaned in October 2020, with a total of 60 bags of waste collected. The cleaning was carried out on Irig Wreath, which has been a favourite picnic spot for years and had accumulated waste that’s left behind by unscrupulous visitors.

This year’s action for removing waste from the mountains of Serbia culminated on Zlatibor. Cleaning activities encompassed the area around the popular hiking trail to the Monument, which is a mandatory route for every visitor to this mountain. These four actions resulted in the collecting of a total of 150 bags of waste, both communal and recyclable, which was taken and further processed by the partner specialised in taking care of its disposal - Ekostar Pak. Instead of celebrations, five million dinars for humanitarian purposes Alongside the strategic and long-term activities mentioned in the area of ensuring a more responsible attitude towards plastics, Lidl is also actively engaged in helping where it is most needed, for humanitarian purposes.

In December 2020 Lidl employees from 30 cities across Serbia were given the opportunity to use funds initially earmarked for annual celebrations to instead select and suggest good causes to receive donations, with the company setting aside five million dinars for that purpose.

Support was provided to both individuals who are raising funds for medical treatment and to institutions working with neglected children and children with disabilities that are based in the same cities

In December 2020 Lidl employees from 30 cities across Serbia were given the opportunity to use funds initially earmarked for annual celebrations to instead select and suggest good causes to receive donations, with the company setting aside five million dinars for that purpose as employees in Lidl stores – from Subotica, via Sombor, Belgrade and Loznica, to Niš.

Most of the money, according to the wishes of employees, has been allocated for the treatment of 15 people registered through the “Budi Human” foundation. In cooperation with this humanitarian foundation, an amount of around four million was directed for the treatment of 14 children and one adult who were most in need at that moment. Help was provided to: Minja Matić, Anika Manić, Oliver Pal Gajodi, Anđela Dimitrijević, Dejan Radojčić, Dražan Vučić, Filip Ivanović, Filip Radojčić, Ivan Filipčev, Jovan Panajotov, Kalina Rašeta, Nataša Stojanov, Ognjen

Stojanović, Ognjen Žužić and Pavle Paunović.

When it comes to local institutions, again respecting the wishes of employees, the remaining part of the total funds was sent to the Centre for the Accommodation and Stay of Children and Youth with Developmental Disabilities in Obrenovac, the Vera Blagojević Home for Children and Youth in Banja Koviljaca, the Duško Radović Home in Niš, the Spomenak Home for children without parental care in Pančevo, the Home for children with developmental disabilities at the Monastery of St. Petka in Izvor near Paraćin, the Humanizacija Association in Sombor and Kolevka Home for children with developmental disabilities in Subotica.

With these donations, the Lidl collective showed that humanity must be above everything, for a better tomorrow for everyone.

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Consumers expect companies to respond to both the global and local threats to economic, social and environmental sustainability that have been imposed by the COVID-19 outbreak

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MK GROUP BUSINESS

Even in a year that was marked by the Coronavirus Pandemic, the traditional action “Support to the Family” continued, within the scope of which MK Group provides financial support to employees within the group's system who became parents during the year. During 2020, more than five million dinars was secured for 146 newborn babies with a parent employed by MK Group in Serbia, Croatia and Slovenia.

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peaking at the Sheraton Hotel event where new parents from the company gathered for a video conference, MK Group Vice President Aleksandar Kostić said that, over the past four years, 620 families and more than 1,000 children have been awarded a total amount exceeding 31

of its employees and the community in which it operates.

MK Group last year received the “Friend of the Family” award of the Chamber of Commerce & Industry of Serbia for this action, and this year’s event was also attended by CCIS President Marko Čadež.

“With the “Support to the Family” campaign and today's event, MK Group – the first laureate of the Family Friend Award that's presented by the Chamber of Commerce and the Serbian Government – celebrates life, as something that is most important to every parent, celebrates children and the future million dinars through the “Support to the Family” campaign.

“The strategic commitment of MK Group is to nurture true values, first and foremost family values, which is why I’m proud that we are also ending this year by supporting families who have bee enriched by a new member,” said Kostić, adding that it is clear to everyone that we live in a time when uncertainty has become commonplace, but that MK Group does not leave to circumstances the support

“With the “Support to the Family” campaign and today’s event, MK Group – the first laureate of the Family Friend Award that’s presented by the Chamber of Commerce and the Serbian Government – celebrates life, as something that is most important to every parent, celebrates children and the future. MK Group is a company that has, for 35 years, cultivated the values of creation, responsibility and sustainability,” said Čadež. He told parents to teach their children about the way they work

MORE THAN 5 MILLION DINARS FOR NEWBORN BABIES IN THE MK GROUP in this company – to be diligent, tenacious, fighters, just like company founder Miodrag Kostić and vice president Aleksandar Kostić.

Also emphasising the importance of support from the employer was MK Group employee Ana Micić. “I’m glad that the MK Group action “Support to the Family” has become a beautiful tradition. Now that one part of the worries and difficulties faced by those of us who received a baby this year is over, this kind of gesture of the employer means a lot to us,” said Micić.

MK Group is among the most successful regional groups, which operates in the fields of agriculture, finance and tourism. Through numerous activities and social responsibility projects, this company strives to provide an adequate contribution to the local community and to support employees in the system. The company’s focus in 2020 was on providing assistance to the health system of the Republic of Serbia in the struggle against the COVID-19 pandemic, with over a million euros donated for the purchase of respirators, medical equipment, food and other assistance for vulnerable sections of the population and medical workers.

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Both CSR practitioners and researchers expect companies to profoundly reconsider their CSR strategies in the postpandemic era and to interlink their personal goals with those related to the UN Sustainable Development Goals

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