Discussants at the fifth e- seminar series organized by the University of Cape Coast School of Business call for greater attention on Corporate Social Responsibility (CSR) during this pandemic.
The topic for discussion was Coronavirus Pandemic and Corporate Social Responsibility Strategies. The e- seminar was chaired by the Provost of the College of Humanities and Legal Studies, Prof. Francis Eric Amuquandoh.
In his introductory remarks, he stated that Coronavirus Pandemic is now a daily word with many thoughts about what to do and how to do what is appropriate. Prof Amuquandoh said corporate social responsibility is crucial especially at this time when communities and employees are vulnerable.
On her part Ms. Sharon Donnir, a chartered accountant and Lecturer in the Department of Accounting at the University of Professional Studies, Accra ( UPSA), CSR is part of corporate strategy and that CSR expenditure must be budgeted for and approved by the board of directors and shareholders at annual general meetings (AGMs).
She explained that CSR should be done with the long term goals of the organization in mind. She said Covid-19 became a serious matter at the time that most companies were preparing for their AGMs coupled with lockdown and restrictions on movements and gatherings. This, she said affected the approval of many annual financial plans including CSR activities and corresponding budgets.
She advised that companies should use virtual means to organize AGMs since spending without approval will have audit implications in the future. Ms. Donnir calls for review of CSR budgets by board of directors and avoid spending above approved revised budgets. She explained that while CSR is a good gesture during the pandemic there should be a responsible limit since CSR is not the core activity of the companies.
She emphasized that when CSR is well budgeted for it is easy to measure the tax benefits associated with any CSR efforts. She advised board of directors not to approve revised CSR budgets beyond the financial capacity of their organizations.
Dr. Abraham Ansong, the Head, Department of Management at the School of Business, University of Cape Coast, explained different motivations for engaging in corporate social responsibility such as philanthropy, economic and legal. He explained that motivation will affect how a company approaches corporate social responsibility. Dr. Ansong, explained that corporate social responsibility (CSR) is variously described by companies as social responsibility, social investment, good corporate citizen and corporate sustainable investment.
Dr. Abraham Ansong
He said these differences reflect the pressure on companies to spend part of their budgets to benefit society and not merely about showmanship. Dr. Ansong argued that companies spending on their employees and close communities is an important part of CSR. He indicated that contribution to the Covid- 19 fund by companies is just part of their CSR. He explained that whatever product or service produced by a company must be seen as CSR that must attract investment by the company to ensure moderate prices, quality and constant supply.
He advised companies against spending greater part of their budget on CSR when they don’t have funds to promote their core activities. He, however explained that CSR is caring so companies cannot avoid showing care to their stakeholders including employees during the Covid period. Dr. Ansong ask organizations to see moderate but targeted CSR as solid social investments.
Ms.Selma El Fard, a researcher at Vigeo Elris who specializes in environmental social governance, explained during the pandemic that much attention has been shifted to health and safety under CSR with limited efforts at the environmental front though with the closure of airports and low industrial production carbon emissions have reduced significantly.
She said stocks with environmental consciousness are receiving value investment as more than 63% of investors and 87% of millennial investors prefer to invest in companies that promote social justice, social investment, employee welfare and environmental good governance. She advised companies to be balanced in where they spend their CSR money to ensure sustainability. Ms. Selma called for shareholder activism to redirect CSR to reflect shareholder interests and perspectives.
Mr. Frederick Aryeetey who is the Executive Director of Institute of Directors-Ghana, explained CSR should not be seen to be an activity only by big companies, that Micro, Small and Medium Scale Enterprise (SMEs) including informal sector businesses should all play their part. Mr. Aryeetey explained that the essence of CSR during the pandemic is for businesses to use a fraction of their income to support their stakeholders. He called for upward adjustments of CSR budgets for companies who have enough buffers. He explained that taking good care of employees in various ways during this pandemic is a good spirit of CSR. He advised companies to support their employees with all the personal protective equipment as part of their social responsibility. He further asked companies to reduce salaries by a certain percentage for their employees instead of laying them off as part of their social responsibility.