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The Mandatory Corporate Social Responsibility in Indonesia: Problems and Implications
Uppsala University, Disciplinary Domain of Humanities and Social Sciences, Faculty of Law, Department of Law.
2011 (English)In: Journal of Business Ethics, ISSN 0167-4544, E-ISSN 1573-0697, Vol. 98, no 3, 455-466 p.Article in journal (Refereed) Published
Abstract [en]

The adoption of the 2007 Indonesian Law No. 40 has created significant debate over the nature of Corporate Social Responsibility (CSR), namely, whether it is voluntary or mandatory. On the one hand, the adoption of such a law represents a legal recognition of the existence of CSR, and this clarification on the legal nature of a concept is necessary for understanding the obligation and responsibility. On the other hand, it has created much confusion surrounding its substance and procedures. This article tries to analyze the development and consequences of CSR under 2007 Indonesian Law No. 40, through the discussion of mandatory versus voluntary dichotomy. It is argued in this article that the mandatory nature of CSR is legitimate and therefore encouraged; however, in practice, this is problematic, as it not only requires a precise concept of interpretation of CSR and identification of the duty bearer and beneficiaries, but also an effective implementation mechanism and a means of verifying the impact.

Place, publisher, year, edition, pages
2011. Vol. 98, no 3, 455-466 p.
Keyword [en]
Corporate Social Responsibility, Indonesia, mandatory, voluntary, regulation
National Category
URN: urn:nbn:se:uu:diva-149707DOI: 10.1007/s10551-010-0587-xISI: 000286336100006OAI: oai:DiVA.org:uu-149707DiVA: diva2:405457
Available from: 2011-03-22 Created: 2011-03-22 Last updated: 2011-03-22Bibliographically approved

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