Corporate Social Responsibility 2019

Corporate Social Responsibility BE RESPONSIBLE FOR THE BENEFIT OF SOCIETY!

ECONOMIC RESPONSIBILITY

ENVIRONMENTAL RESPONSIBILITY

SOCIAL RESPONSIBILITY

WORKPLACE RESPONSIBILITY

2019

INTERVIEW

DRAGAN GOLUBOVIĆ PH.D.

Serbia's EU Agenda Influences CSR Policies Consider the abandoning of the use of plastic bags in Serbia as an important example of how the engagements of large companies in the domain of corporate social responsibility in the country moved from being purely philanthropic to become socially aware.

Yet much more can still be done to push both large companies and SMEs towards being active in CSR

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he European Union has been very active in promoting corporate social responsibility as an important tool in improving societies.

Although Serbia is not following that example closely, the EU integration process is also likely to bring more advanced polices related to corporate social responsibility, says expert on CSR Dragan Golubović Ph.D.

• To what extent is Serbia’s institutional framework in the field of cross-sector partnerships and corporate social responsibility harmonised with European policies in this field?

- It is noteworthy that issues related to cross-sector partnerships (CSP) and corporate social responsibility (CSR) have steadily gained traction in the European Union. Among others, they are addressed in the EU 2020 Strategy for Smart, Sustainable and Inclusive Growth, the renewed EU Strategy on CSR 20112014, and the Action Plan on Human

Rights and Democracy 2015-2019. The importance of CSP and CSR has been further underscored within the framework of the EU Sustainable Development Goals. Thus, the European Commission’s sub-group on CSR has put forward a number of policy recommendations for the EU and its member states that would encourage and facilitate CSP and CSR practises. These include, among others, raising awareness and encouraging public authorities to utilise possibilities presented in the EU law for integrating environmental and social considerations into their respective procurement processes, supporting awareness and the implementation of due diligence by companies against human rights and other social risks etc.

In addition to the aforementioned soft instruments, EU Directive 2014/95 requires disclosure of non-financial information by certain large economic undertakings and groups with respect to

The tax law doesn't currently recognise human rights, the promotion of gender equality or European integration as charitable causes

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environmental protection, social responsibility, the observance of human rights and other pertinent social issues.

At this juncture, Serbia does not have a comprehensive strategy with respect to CSP and CSR. However, issues related to CSR are recognised as cross-cutting issues for a number of EU accession negotiation chapters, including public procurement, environment, and social policy and employment, to name just a few. It is therefore fair

to assume that policy measures pertinent to CSR will gradually be introduced as negotiations progress with the EU. • What have examples of CSR in Serbia to date shown about the extent to which companies perceive this area of their operations as an integral part of their development policies?

- It is evident that issues related to CSR have been mainstreamed into the overall business strategies of large companies operating in Serbia, regardless of their origin (domestic or foreign). This practise reflects a general recognition that CSR is not an expense, but rather an investment that plays a significant role in ensuring that a company keeps and expends its customer base. On the other hand, it is still fairly rare for an SME in Serbia

to have some form of CSR strategy in place. This has to do with a number of factors, not least the lack of necessary resources and lack of capacity, as well as policy measures that would encourage and facilitate this process.

• CSR often boils down to philanthropic donations. Is this still the case in our country when it comes to companies’ practises?

income for charitable causes. While the general framework for corporate giving is modestly favourable, there is significant room for its improvement. Among others, the list of charitable causes in the tax law needs to be aligned with the one in the Law on Associations and the Law on Foundations and Endowments, respectively. Currently, for example, the tax law does not recognise human rights, the promotion of gender equality or Eu-

The practise of CSR in Serbia has passed a point of the concept being reduced to giving donations - The practise of CSR in Serbia has passed the point of the concept being reduced to giving donations. Rather, large companies increasingly strive to lead by example in addressing pressing social issues. The recent decision of a number of large retailers to abandon the use of plastic bags is just one example of this trend.

• What could be done in terms of tax policies in order to encourage corporate donations?

- Under the tax law, a company may deduct up to five per cent of its annual gross

ropean integration as charitable causes, and thus donations for those purposes are not exempted from taxation. In addition, it is unclear whether a donation in real estate would qualify as tax exempt; whether a donation in the form of an institutional grant (a donation designated to support the institutional development of a donation recipient, rather than the implementation of a particular project) would qualify as tax exempt; what is the tax status of a carry-over donation; and to what extent a donation can be used to cover the overheads of a recipient.

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The more pressing issue, however, seems to be the practise of the Tax Office requiring a donor to submit to the Office material proof that a donation is spent legitimately by the recipient. This should ultimately be the responsibility of the recipient, rather than the donor. As a result of this malpractice, many donors avoid duly reporting on donations, but rather treat them in their books as other, non-deductible expenses.

• One element of CSR is encouraging volunteering. What challenges do companies face in developing this important dimension of social action?

- While the law does allow companies to host volunteer activities under certain conditions, it is overly intrusive and prohibitively expensive for a host of those activities. That is largely due to the fact that the law regards volunteering as a subset of labour relations, rather than as a private, voluntary activity.

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While the law does allow companies to host volunteer activities under certain conditions, it is overly intrusive and prohibitively expensive for a host of those activities Among other things, a host of volunteer activities are required to cover the cost of work insurance for a volunteer, as well as his or her medical, social and pension contributions. As a result, rather than encouraging and facilitating volunteer activities, the law is largely recognised as a major impediment for the development of volunteering.

• Investing in one’s own human resources and the development of human capital represents an important dimension in the development of companies and in the development of society. To what extent do solutions in Serbia related to

scholarships favour investments?

- The current legal framework provides quite modest incentives in this respect.

Under the personal income tax law, a recipient of a monthly scholarship of up to 11,741RSD (circa 100 euros) is exempt from paying personal income tax. However, the Ministry of Finance is currently considering amendments to the law that would increase the tax exempt monetary threshold for monthly scholarships from 11,741RSD to as much as 30,000RSD. In addition, the new proposal would allow for scholarships to be paid not only monthly, but in any other time sequence, including one-off payments. ■

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BUSINESS

BOJANA RUDOVIĆ, MARKETING DIRECTOR AT BEKAMENT

Success Is Greater If It Is Shared Photo: BIZLife/Sanda Mokanić

We Build With Heart

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ver the course of almost three decades, Bekament has grown from a small family business to become one of the most technologically advanced companies in the production of construction finishing materials. At Bekament they believe that success is greater if it is shared, which is why they wholeheartedly encourage the development of community in the areas of health, culture, sports, environmental protection and sustainable development.

Bekament is a company that supports its Foundation’s projects through financial assistance, as well as through donations of its own products. Over the past two years, with the vision “We Build With Heart” socially responsible projects have been launched and implemented that have been recognised as significant for the community.

• Bekament is a company that’s spent almost three decades encouraging the development of the community in which it operates. What are the main aspects of your company’s corporate social responsibility?

- Corporate social responsibility is integrated into our business strategy and built into the foundations of our company’s corporate culture, its vision and values, and encompasses various aspects of operations. Respect for ethical values and principles are certainly an imperative of our company.

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In strategic CSR settings, the basis of the structure is represented by employees, i.e. their needs, motivation and satisfaction, which also further contributes to the building of stable and long-term relations with all stakeholders. Bekament also supports humane initiatives directed towards caring for the people and the community in which it operates, which implies investing in the advancement of education, culture, health, sports and environmental protection.

• Bekament is also officially one of the most socially responsible companies in Serbia, as confirmed by the VIRTUS awards and notes of thanks that you received in 2012, 2014 and 2018.

How much does such recognition mean to you?

- From the very beginning, the people who built Bekament have believed that success is

towards the humane and ethical dimensions of social responsibility, is also supported by the establishing of the Bekament Foundation. The aim of the Foundation is to unite the public and private sectors, to bring together companies, organisations and individuals, and to create an environment that will stimulate support for investments in the common good of society as a whole.

In the past two years, with the vision “We Build With Heart”, social responsibility projects have been launched and implemented that have been recognised as being significant to the community. The most significant among them are the construction of a new wing of the General Hospital in Aranđelovac, restoration of the SOS village in Sremska Kamenica for children without parental care, reconstruction of the

Our goal is to encourage as many companies as possible to contribute to the community and sustainable development through socially responsible work greater if it is shared. We are constantly creating a reputation as one of the more socially responsible companies on the territory of the Republic of Serbia, which is also confirmed by the VIRTUS awards.

Awards are indeed of great importance to us, because they testify to the strength that we hold within us as humans. That motivates us to continue to provide our own contribution in order for things to be better for all of us every day.

• You also founded the Bekament Foundation two years ago. What is its primary area of activity?

- One of the long-term strategic pillars of Bekament’s operations, and which is directed

Textile School in Belgrade and the Saint Sava Primary School in Aranđelovac, restoration of the Gendarmerie [police] building in Belgrade, the complete equipping and construction of two playgrounds for children in the Voždovac and Zvezdara municipalities etc.

The projects that we joined in past few months imply silver membership in the BELhospice Sustainability Club, with the goal of improving the quality of palliative care for patients with malignant diseases. We’ve also joined the humanitarian action “Pruži korak” [Take a Step], which is organised by the National Association of Parents of Children with Cancer (NURDOR), in order to raise funds for the construction of a parental home in Belgrade. ■

CARLSBERG SRBIJA BUSINESS

For A Better Quality Life Caring for the community in which it operates is one of the priorities of Carlsberg as a company, which is testified to by the numerous donations realised through this company's foundations, at both the local and global levels. Globally, as one of the world's oldest commercial foundations, the Carlsberg Foundation operates through support for science, students, the arts and culture

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ounded in 1876, when J.C. Jacobsen secured the future of his brewery by transferring it to the management of the Danish Royal Academy of Sciences and Literature. The Carlsberg Foundation has been managed by the Carlsberg Group ever since, taking care to ensure that the brewery works with a focus on innovation and the production of high-quality products, while simultaneously supporting research in the scope of natural, social and human sciences.

The Carlsberg and Dunđerski Foundation was founded in Serbia in 2015, with the aim of connecting the world-renowned Carlsberg Foundation and the works of Lazar Dunđerski, who has remained remembered in Serbian history as a great philanthropist and protector of children and the youth. The activities of the Carlsberg and Dunđerski Foundation are directed towards preserving the cultural heritage of Vojvodina, protecting the environment and supporting science and education, protecting consumers, but also developing the local community of Čelarevo. The scope of its support to science and education encompasses cooperation with educational institutions, as well as students and academics themselves, in the form of scholarships and grants.

One example of the successful linking of the private sector and educational institutions

is Carlsberg’s long-standing cooperation with the Faculty of Technology in Novi Sad. The Carlsberg and Dunđerski Foundation recognised the University of Novi Sad Faculty of Technology as a higher education institution that educates high-quality personnel, which is why it has awarded scholarships since 2015 to the best students of the second, third and fourth years of basic academic studies and master studies in the domain of food biotechnology.

Alongside scholarships for the best students, Carlsberg Srbija also contributes to the work of the Faculty of Technology in Novi Sad through the professional work placement practise that it provides for students. Additionally, at the end of October, another of the many socially responsible activities implemented

by Carlsberg Srbija was realised at this higher

education institution. This was realised regarding the donation of a mini brewery.

The mini brewery will enable students of this prestigious faculty to work specifically on individual devices, as well as on the entire process of producing beer after acquiring theoretical knowledge within the subjects of Beer Technology, Special Beer Technology, Alternative Raw Materials in Beer Production and Quality Control in Malt and Beer Technologies.

Support for science and education, but also the development of the community, will remain in the focus of Carlsberg Srbija’s operations in the period ahead. The numerous social responsibility projects that are implemented demonstrate the company’s determination to contribute to improving the quality of life in the area in which it operates. ■

“With the donation of a mini brewery to the Faculty of Technology in Novi Sad we are continuing our longstanding cooperation with this educational institution and striving to enable future experts in the beer industry to also acquire practical knowledge during their education, which they will be in a position to apply later in their work. Support for science and education is in the focus of our social responsibility projects and we will continue to further realise such activities,” said Carlsberg Srbija CEO Vladimir Vava.

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NEWS

FIVE NEW CSR TRENDS FOR THE YEAR AHEAD The main corporate social responsibility trends include increased transparency, investments in green technologies, the engagement of the local community and employees, as well as the recognition of economic inequality.

Transparency – as part of the business model that embraces corporate social responsibility, transparency sees companies sharing ever more information about the environment and management.

THIS IS A LIST THAT EVERY COMPANY WANTS TO FIND ITSELF ON

Creating new resources – instead of simply moving on to the next source of materials, fossil fuels and cheap labour, socially responsible companies invest in green technologies and develop alternative resources.

Global companies act locally – even the largest multinational companies recognise the value of local markets and supply chains, and actively attempt to engage in activities that are beneficial to local communities.

Volunteering – companies that keep pace with CSR trends don’t only enable their employees to provide a positive contribution to the community through volunteering, rather they also encourage investments in time and labour for the benefit of society.

Investing in employees – as the issue of economic inequality emerges at the top of the interests of every society, so it increasingly places pressure on corporations. That’s why increasing the earnings of the lowest paid employees is one of the major CSR trends.

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The renowned Reputation Institute, an organisation that specialises in researching corporate image and reputation, has been publishing its CSR Rep Track for years, as a list of the most socially responsible companies. The ranking started 10 years ago and is based on a survey of nearly 60,000 consumers in 15 countries, relating to the reputations of more than 3,000 companies.

According to research conducted by the experts of this institute, a clear link has been established between corporate social responsibility and company reputation over the last decade, which is why companies’ efforts and endeavours to make the list are growing. The stronger and more effective CSR policy a company has, the better its reputation and brand image. When the perception of a company’s corporate social responsibility is bad, so is its image.

Corporate Social Responsibility (CSR) is a self-launched workplace initiative that ensures businesses use their resources to make positive changes in their own communities and worldwide. Consumers expect this responsibility from the brands they believe in, with 63 per cent of U.S. consumers reporting that they expect companies to take the lead on issues of social and environmental justice. Apart from doing good, CSR can also enhance a company’s latest performance results by impacting on everything from customer loyalty to employee recruitment. Some 87 per cent of consumers say that they would make a purchase based on a company’s efforts, and 90 per cent of millennials would accept a pay cut to work for a company that shares their values.

YOU CAN'T HELP BUT LIKE THE WALT DISNEY COMPANY Disney is among the world’s five most socially responsible companies. One year they donated free tickets to their Disney parks to millions of people in exchange for a day volunteering.

Moreover, in partnership with organisations like Make-A-Wish, Disney helps each year to fulfil the wishes of more than 10,000 children living in war-torn areas, countries hit by natural disasters, children living in absolute poverty etc.

But that’s not all! Back in 1995, Disney launched the Disney Worldwide Conservation Fund, in order to support global and local nonprofit organisations that protect wildlife and the environment.

BILL GATES STILL WITHOUT COMPETITION

BELIEVE IT OR NOT, BUT WE SAVE THE PLANET BY WORKING FROM HOME Microsoft has so far enabled more than 12 million young people in 54 countries to come into contact with advances in IT technology, to learn and advance. In 2018 alone, Microsoft donated three billion U.S. dollars to small businesses, as well as software services worth $1.4 billion to non-profit organisations around the world.

The goals of former Microsoft CEO and major shareholder Bill Gates are to empower people through education and access to technology; to protect human rights and protect the environment, while he founded the non-profit Bill & Melinda Gates Foundation in order to most effectively get to grips with inequality worldwide, to eradicate malaria and develop agriculture.

It might not have launched the initiative, but Google is among the companies that are encouraging employees to work from home or anywhere else that does not require travelling to an office by car, motorbike or any other vehicle that emits polluting exhaust gases.

Demonstrating the powerful efforts of Google leaders to contribute to reducing carbon emissions by reducing greenhouse gas emissions is the fact that the Google campus at Mountain View is home to goats. Their “job” is to maintain the lawn, in order for lawnmowers not to be used. Thanks to its major investments in green energy, Google is powering its data centre with 100 per cent renewable electricity.

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BUSINESS

NOVO NORDISK

Circular Mindset

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rowing consumption, industrialisation and urbanisation threaten not only the sustainability of the environments in which we live, but also the health of people around the world.

Every year at Novo Nordisk we use billions of litres of water and significant amounts of energy and resources to manufacture medicines. We distribute hundreds of millions of products to people who need them – and demand for our life-saving treatments is growing. That puts us on the front line of some of the biggest issues: climate change, water and resource scarcity, pollution and plastic waste. We are well-known and committed to driving change to defeat diabetes and other serious chronic diseases, but to do that we also recognise our responsibility and commitment to creating a sustainable, healthy environment for the long-term.

Novo Nordisk has a bold and simple ambition: to have zero environmental impact. In order to achieve this, the company is embracing a circular mindset – designing and producing products so that they can be recovered and re-used, and reshaping

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Novo Nordisk has amassed two decades of experience of being at the forefront when it comes to environmental responsibility. And this responsibility has been driven by today’s environmental challenges, which have never been more critical or urgent

business practises to eliminate waste by turning it into new resources.

Driving environmental improvement is a long-term task, and Novo Nordisk’s new environmental strategy, Circular for Zero, sets out the targets and milestones for the next chapter of this journey. We will implement circular approaches across our value chain by 2030. We’re aiming to hit zero carbon targets in our own operations and with key suppliers, eliminate wastage of energy, water and materials in the company, and take big strides towards reusability and recyclability through product innovation. We have previously focused on reducing carbon emissions in our operations. We have managed to achieve 100% renewable power in our production plants all over the World and

are a founding member of ground-breaking circular partnerships in Denmark. However, today it’s no longer enough to focus on the environmental impact of our manufacturing processes, which is why we are thinking beyond that at Novo Nordisk. As such, in making and structuring our business decision, we design and produce our products so that they can be recovered and reused, minimise consumption across our value chains, i.e. eliminate waste – in other words, apply a ‘circular mindset’ to whatever we do.

By embedding a circular mindset, we want to unlock innovative ways to improve the company and, through that, our environmental footprint. And to meet the scale of this challenge we know we must collaborate deeply and widely with partners. ■

BETTER BUSINESS FOR BETTER SOCIETY

Responsible Business Forum gathers leading companies that contribute to the development of the society through the principles of responsible business. By practicing innovative approach to business sustainability, RBF encourages all sectors to contribute to the measurable social impacts.

The RBF empowers companies to operate in accordance with the principles of sustainable development, create a synergy of resources and

knowledge and develops practical tools for managing socially responsible activities. At the same time, RBF works closely with relevant actors in the field of improving legal and regulatory mechanisms that contribute to improving the framework for the implementation of socially responsible activities.

RBF is a national partner of leading European and global organizations devoted to sustainable development.

WWW.ODGOVORNOPOSLOVANJE.RS

BUSINESS

MARINA DELEON, COMMUNICATIONS EXPERT

Gifts With Meaning The New Year's holidays having always been a time for summing up results and making decisions for the year ahead. And a time of giving

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n the corporate world, this need to give gifts and recognition on an annual basis has not changed; it has existed “since time immemorial”, just as our need to give to the wider community is not an expression of either the contemporary world or modernity, as a different philosophy of doing business, but rather is probably one of the immanent features of our civilisation.

Traces can extend back deeply, but let me stop at giving to those who are weaker, those who are without, and that ennobling act also gives meaning to our lives and even deeper meaning to our work; “added value”, as someone would say today.

Corporate giving, or corporate social responsibility, CSR, has a slightly different definition, but I believe it comes from the same source of desire for the successful to partly give something back to the wider community, making it better, more beautiful, more humane and making themselves and their efforts more meaningful through that act. And that ‘R’, which stands for responsibility, articulates the need for modern business operations to prove and demonstrate responsibility for the moral aspect of doing business in the broadest sense.

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Today we would also add to this strengthening through a common goal directed towards the greater good of the wider community, from the neighbourhood in which we operate to responsibility for the future of the planet...

Why do i mention that specifically?

Because of the general divide between an act that’s directed solely towards giving for philanthropic purposes or giving to vulnerable groups or donations, and giving through social programmes or projects aimed at raising awareness to a higher level to make our wider urban, national or global environment better...

As someone who is primarily an advisor and creator of CSR policy for my clients, I’ve often been asked how to choose the right corporate goal that is appropriate for the client, that makes sense in the context of the size and type of the company, and which is also something we’ll all be proud of, but also an act that will make a difference...

A donation, yes, but always in such a way that it frees from the aspect of self-praise, an advertisement that could hurt the one to whom it is addressed. This is a difficult and very sensitive issue, but it is possible – with careful consideration, empathy – to reach a good result that helps discreetly

STUDENTS FILM AT ACB

TRADITIONAL ACB CALENDAR SUPPORTING ART

and meaningfully, and brings pride to your entire team.

The traditional principle of giving in such a way that you do not know to whom you are giving and the recipient does not know from whom a gift has come has for many centuries been considered the highest form of help, both personal and corporate...

This is possible as an individual act, but it’s tougher in the corporate world, while from the aspect of corporate needs it isn’t even a valid request. On the other hand, if CSR is conceived in such a way that it is obvious that it represents an attempt of a client to “clear their conscience”, while that client has completely different standards of doing business, or the action is obvious free PR, it will ultimately return to the corporation like a boomerang, bringing only a negative image instead of benefits and satisfaction.

Viewed in theoretical terms, since the time that the term CSR was coined and came into use, in the United States in the 1950s, it has undergone many changes and new connotations.

This business morality aspect has not changed, and I believe that striving towards that makes a lot of sense and is justified in both business and social terms.

And it is practically better and yields results, thus my thinking would go in the direction of: use a little creativity to depart from clichés and see what your stronger

ing equipment or giving knowhow, you are giving someone a platform on which they can develop and can become one who will do the same tomorrow for the next generation. Enriching the concept of social giving from the R = responsibility aspect, CSR has undoubtedly gained much and is today more closely understood by young businesspeople who have a need to articulate their active relationship towards the immediate and wider community.

That’s how each of our creative actions in which we gave space at the Airport City Belgrade business park to creative people, in order to prove themselves and to create new value from that, has paid off many times over and enriched the company’s image.

And our team is extremely satisfied and proud when they see young people

ACB PROMOTES ECO AWARENESS

sides really are and what your true potential contribution is in that domain, then the project will simply shape itself in the best direction.

Young creatives will find it easier to identify with a project to protect the planet or wastewater, or just to save a waterway that is closest to them, rather than some high-octane action that’s far away from them and which, regardless of its grandeur, absolutely doesn’t reflect the needs of their company.

If you are giving, “teaching someone to walk” is a principle that I would always prefer to choose for corporate CSR. Through education, through the providing of a market opportunity, or donating space itself, buy-

who gained their first serious business experience in collaboration with us.

And for donations in this context we’ve always selected either developmental creative projects or, when it comes to marginal or deprived groups, projects in which the recipient doesn’t receive a simple donation, but rather space to develop all of their potential and become independent in the scope of their possibilities.

Not a long way, but actually it is. ■

Wishing you a happy & fruitful year!

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