CSR - A FAIR DIVISION OF THE SPOILS?

Calculating the cost of giving    

                              

A hefty new motorbike van is just the transport needed for the kids of Kalipare, a village between Malang and Java’s south coast. It can climb hills and cope with the rugged roads even with a full load of giggling girls.

The St Yohanes elementary school has 54 students, but almost a third live too far to walk.  Few families can afford their own motorbike.  Reality check: No free transport, no education.

Fortunately a generous person gave Rp 21 million [US$1,650] to buy the machine, which is pleasing news for the school. There are no company logos, so no commitments to commerce.

However the gift didn’t come with money for fuel, maintenance and salary for driver Yulius Katijan .  Consequently these expenses have been lifted from the general school budget.  This means the ‘library’ (right) will remain a junk room until another donor appears to pay for stock and refurbishing.

These are the sort of issues that poor schools in Indonesia have to juggle when government cash is not enough.  They are also encountered daily by Father Bonifasius Hudiono, 53, who heads the Karmel Foundation in East Java.

Karmel supports 7,000 students in 61 village schools and 60 kids in an orphanage.  Some money comes from the Indonesian government, though Father Bonifasius alleged that local officials cut 20 per cent off the grants.

He committed himself as a man of God after completing theological studies 25 years ago. Although he insists that thumbing a calculator hasn’t replaced his commitment to the cross, his days are spent wondering when the next rupiah will arrive.

 “Deus providebit” [God will provide], he said, and to test his faith checked Karmel’s bank balance on his smart phone. Lo and behold, Rp 10 million [US$770] had just been deposited.

Didn’t he want to know the source?  He knows the person, but not how they got their cash.  So if it was from trading stocks in companies that make cigarettes, alcohol or weapons would he accept?

“These are ethical questions that we haven’t started to think about in Indonesia,” he said. “I have taken money from a tobacco company’s education foundation, but thought that to be OK because it wasn’t directly associated with smoking. We won’t promote the company’s products.”

Taking a principled stand on moral issues is easier in countries where governments fund compulsory education and no-one is denied schooling for want of money.  But in Indonesia there’s little space to debate such niceties when the needs are raw and urgent.

Only three pupils at St Yohanes are Muslim, according to principal Wuryanto. But down the road at St Antonius junior high school the majority are Muslim.

 “We are not seeking to Christianise students – that’s a lie,” said Father Bonifasius. (below) “We are trying to provide high quality education and care so children in isolated areas get a chance to succeed. Parents who appreciate what we’re doing will eventually make the schools self sufficient.

“Attracting business donations is becoming difficult as the government gets more efficient in taxing companies, which are now less interested in Corporate Social Responsibility [CSR]. [See breakout]

“We’ve had money from Europe and Japan but these donations tend to be for one-off projects.

“People give for a variety of reasons.  Maybe a few think they are buying a ticket to heaven.  But most are genuine, giving thanks for the church’s help or because they’d like to share their blessings.  We want people to give with a good heart.

“I don’t sell poverty.  When people ask what they can do to help the poor I just direct them to a specific need at a school.”

Endang Haryani (above) doesn’t get to follow her training as an engineer.  Instead, like Father Bonifasius, she spends her time hunting rupiah for Malang’s non-denominational Foundation for Educating the Handicapped [YPAC], supporting and training about 140 young people.

She’s also had to look overseas. Recently she got a direct donation from the New Zealand Embassy and a rehabilitation charity in NZ to upgrade facilities at the school.

“We’ve been operating for 60 years and the government allows us use of the building,” she said. “We need Rp 1.5 billion [US$ 115,000] a year for running costs – we get Rp 45 million [US$3,500] from the government.

“The rest comes from donors.  Although we’ve put up many proposals for CSR funding we’ve had only one response – from a bank. Not all donors want to be involved with the handicapped.  It’s definitely getting harder to raise money.”   

Need for reform

The Corporate Social Responsibility system, where companies pay for community services, can be thinly disguised advertising.  Users of a small recreation park in Malang promoting good health are left in no doubt that a tobacco company has funded the equipment.

In 2012 the national government enacted a 2007 law requiring companies that manage or use natural resources to bear a social and environmental responsibility.  The original legislation applied to all corporates, but strong objections from business whittled application down to extractive industries.

Dr Dwi Budi Santoso ( right), vice director of Brawijaya University’s Development Economics and Society Study Center agreed that the CSR system was unfair because it depended on a company’s location, size and interests, and the skills and contacts of fundraisers.

“I was an advisor to a local government in East Java in its negotiations with a gold mining company,” he said. “We wanted CSR to be built into the agreement but the company refused because it would have diluted profit. So the permit was refused.

“Companies can play favorites with CSR, and it’s difficult to enforce. There’s not much trust between government and business and there’s a lack of accurate data. The whole tax system in Indonesia needs to be reformed to make sure the disadvantaged who need funds get State support wherever they are.”

(First published in The Jakarta Post 22 March 2015)