THE Corporate Social Responsibility (CSR) is now being practised as a business discipline by a very large number of local and foreign companies, particularly those in export business.

“We are part of the international business community and just cannot escape it’’, said Mr Iqbal Ibrahim, a former chairman of All Pakistan Textile Mills Association (Aptma) while replying to a telephonic query. Out of the nine companies he owns and manages, four practice CSR code.

His estimate for corporate investment in social sectors ranges from one to 1.5 per cent of the pre tax profits. The range of services include education, health, a playfield or a library for children and addressing the environmental pollution issues. It involves upgrading the skills of employees and taking care of their children’s health and education.

Social compliance became indispensable for export-oriented firms when importers started demanding adherence to certain social standards. The companies exporting to the US and Europe are now expected to observe labour laws, to maintain hygienic working conditions in their place of work, to abolish child labour, and to maintain internationally-accepted health and hygiene standards in production/ packaging.

“Our buyers carry out two social audits every year of our company’’, the APTMA Chief informed and added that a third audit is done by an international consultant not known to us. Maintaining a certain social standard and periodical audits have pushed up the production cost “but our buyers do not give any discount to us’’ he complained.

No consolidated figures and detailed information are available on investment being made by companies in social sectors and how such activities benefit the company and the community.

But as the number of firms that comply with social responsibility concept is increasing, the necessity to gather reports and information and their dissemination for improving corporate image is also being felt. Trade bodies are now taking the initiative. The Overseas Investors’ Chamber of Commerce and Industry is preparing a detailed report to be published in February which is based on data and information related to social responsibilities being performed by its members.

An 8-member CSR committee was formed at the Federation of Pakistan Chambers of Commerce and Industry this year in April with a declared aim to transform business entities into “responsible, profitable corporate citizens’’. This aim is to be achieved by producing safe and useful products and services. Business entities are to provide meaningful and dignified jobs. They should ensure a fair value for money to their customers and enhance ethical and long-term returns for their shareholders. They should also focus on care and career growth of their employees.

Business leaders are somewhat reluctant to declare as to what extent their own business firms had complied or are complying with the CSR aims but appear firm about transforming their business entities into responsible corporate citizens over time.

“By upgrading the skills and empowering them with decision making at various management levels in my business, contended and happy employees create a congenial work culture that brings joys and satisfaction to me as an employer and owner,’’ Mr Tanveer Sheikh, President of the Federation of Pakistan Chambers of Commerce and Industry informed this correspondent from Multan about benefits his business gets from practicing CSR.

Mr Siddique Sheikh, chairman FPCCI CSR Committee, expects business firms all over the country to observe CSR discipline. He will assist them through a network of 70 affiliate chambers of commerce and industry and 140 trade associations. He has managed to put a team together and has prepared an action plan. There are 13 standing committees of the FPCCI on research and development, special education, literacy and information technology, telecom, higher education, science, technology and technical education, sports and culture, human development, poverty, health and environment etc.

Each of these committees is led by prominent business leaders. “Members of social sectors standing committees at the FPCCI are service above self (SAS) persons They have volunteered their talent and time to play a role as change agents’’, the CSR document identifies the chairpersons of these committees.

Many of these committees have held more than one meeting to draw a road map in their respective areas and as the concept paper of the FPCCI CSR Committee explains, the idea is to empower companies to add value to their business through improving legal compliance, human competence, operational competitiveness and global image to ensure healthier profitability.

These committees are expected to guide business companies to channelise, facilitate and enhance their philanthropic endeavours by building up their capacities, evolving concepts, supporting accountability and monitoring implementation.

The FPCCI Standing Committee on CSR with 13 sectoral committees is engaged in establishing a strategic network and match making with corporations on the basis of their preferred area of philanthropy with civil society organisations.

“Philanthropy is a very small part of CSR’’, Majyd Aziz, a former President of Karachi Chamber of Commerce and Industry explained. In fact he stressed that philanthropy is purely an individualistic voluntary act to serve fellow citizens or a community in distress.

“Corporate philanthropy has increased almost ten times from Rs228 million in the year 2,000 to Rs2.3 billion in 2006’’, Prime Minister Syed Yusuf Reza Gilani informed a gathering in June last year at an award distribution ceremony of Pakistan Centre of Philanthropy. He appreciated the corporate sector’s growing sense of social responsibility but urged the businessmen to take their current philanthropy level from 0.6 per cent to one per cent of profit before tax which, he said, is the international standard and the corporate sector needs to follow it.

He reminded the audience in the PM House that the government had withdrawn a budgetary proposal related to donations to retain 15 to 30 per cent tax exemption on donations from companies and business houses.

A National Survey of Individual Giving 1998-99 (reported in Indigenous Philanthropy Report-2000) estimated a total donation of Rs70.5 billion in cash and kind. Out of Rs29.79 billion, Rs13.78 billion were given as zakat, usher and more than Rs16 billion as non-zakat. Gifts given in kind were worth Rs11.31 billion.

“Care and compassion has been part of our belief’’, Mr Anjum Nisar, President of Karachi Chamber of Commerce and Industry, remarked while informing that the Chamber has built a hospital in District West of Karachi to offer free medical treatment to the poor.

Zubair Motiwala, a former chief of KCCI and SITE Association of Industry said a comprehensive social development programme for Karachi that will include health and education, is being prepared. The recently elected leadership of SITE Association plans to prepare a programme for health care, education and housing of the workers’ families.

“Growing income disparities have caused social friction which is amply manifested in increasing number of crimes and violence. Before this situation turns into a social commotion, both government and private sector, have to do something’’, Majyd Aziz said.