GENERAL BUSINESS ENVIRONMENT

(Social Environment: Corporate Social

Responsibility and Business)

Corporate social Responsibility by AQUA DANONE

Lecture:

Nicollas Warouw, PhD

Compiled by:
Widya Arie Susanti
09/296079/PEK/14685
Batch 54 International

MASTER OF MANAGEMENT PROGRAM

FACULTY OF ECONOMICS AND BUSINESS
GADJAH MADA UNIVERSITY
YOGYAKARTA
2010
Introduction

In doing business there is some activities that done by company to reach the existences in
society. This kind of activities called as part of business ethics activity, its activity represent
as Corporate Social Responsibility (CSR). CSR is generally understood to be the way a
company achieves a balance or integration of economic, environmental, and social
imperatives while at the same time addressing shareholder and stakeholder expectations. CSR
is the way businesses engage/involve the shareholders, employees, customers, suppliers,
governments, non-governmental organizations, international organizations, and other
stakeholders.

CSR is closely linked to sustainable development of an enterprise, where there is the

argument that a firm in implementing its activities should be based on the decision is not only
based on financial factors, such as profits or dividends, but also must be based on social and
environmental consequences for current and long term. At this time the CSR to be the biggest
concern of the company's role in society has been enhanced with increased sensitivity and
concern for the environment and ethical issues. The problem of environmental destruction
just as inappropriate treatment of employees, and production defects that cause discomfort or
danger for consumers is become the topics for media.

Concern to the people or community relations can be interpreted very widely, but in brief
can be understood as increasing the participation and position the organization within a
community through various efforts together for the good of the organization and the
community. CSR is not just charity, in which CSR requires a firm in its decision-making for
seriously take into account the effect of all stakeholders of the company, including the
environment. This requires the company to create a balance between diverse interests of
external stakeholders with the interests of shareholders, which is one of the internal
stakeholders.

CONTENT

CSR movements has been widely performed by major companies. One of them is Aqua
Danone which is the company that produces bottled water in Indonesia. This company
through one of its flagship product recently held a CSR program 1 to 10. program mechanism
is for every 1 bottle of AQUA which is 600ml and 1500 ml sizes specifically labeled that

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were sold until 2015 it will become 10liter of clean water to communities in the area of
South Central Timor, East Nusa Tenggara (NTT) as the beginning. NTT Selection is based
on a recent survey conducted by ACF, NTT is also regarded as an appropriate location due to
water scarcity conditions umu occur in parts of eastern Indonesia.

The 1 for 10 liters program is to raise awareness of healthy living habits through the
provision of access to clean water and education on health for the area in need. By
mechanism: every purchase 1liter AQUA (with a special label), AQUA is committed to
provide facilities providing access to clean water 10 liters. The purpose of this program is
because AQUA wants to contribute proactively and continuously to provide solutions to
existing problems, including difficulty in access to clean water in Indonesia, to achieve
improved health habits of the family. In addition, the program is in line with the Millennium
Development Goals endorsed by the United Nation to eradicate poverty and hunger in some
parts of the world that are targeted in 2015.
On the program 1 for 10 liter in 2007, AQUA has successfully built more than 200 water
points in both the districts of Amanatun and Boking in East Nusa Tenggara, which could
reach about 12,000 beneficiaries. In programs that have successfully implemented this, there
are 3 main pillars of the successfully realized:

• Providing Access to Clean Water Easier

• Healthy Lifestyle Counseling
• Community Empowerment in the region
With keeping the three pillars above, AQUA is committed to continue the success of 1 to 10
liters in 2007, through the same programs in this year. They still concern in East Nusa
Tenggara or NTT, on the basis that previous programs have successfully contributed to
significantly improve their quality of life. But we do not close your eyes that clean water
access problems still exist in some other areas that need attention. Otherwise with this
sustainable program, it is expected to bring more sustainable result.

In 2009 AQUA help more other areas in East Nusa Tenggara, in the year of 2008 AQUA
help Boking and North Amanatun, the program continued this year will target Boking, North
Amanatun, Toianas and Noebana. There will be more and more people who become
beneficiaries of the program, to be 18,900 people over the previous year 12,000 people.

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Danone Aqua has allocated funds for its CSR activities in 2010 amounted to Rp12 billion, an
increase of 20 percent from the year 2009 amounting to Rp10 billion. Danone will develop
their CSR programs with the same theme but more developed. Through the program Danone
Aqua contribute actively and sustainably to provide solutions to various problems related to
water supply in Indonesia. WASH program is one of One to Ten programs that are now in the
East. The program is in line and support the Millennium Development Goals (MDGs)
proclaimed by the UN to fight poverty and hunger in many parts of the world with a target in
2015. It said, in addition, Danone Aqua in 2009 in addition to courses 1 to 10 liter, also has
conducted 41 activities in the form of environmental education, conservation of watersheds
(DAS) in 12 plant locations throughout Indonesia. CSR programs are still seeded WASH,
which stands for water, sanitation, and hygiene. WASH started since 2006, and until now is
still the Aqua Danone's commitment to the community. Until now, about 10 thousand people
of Indonesia get support access to clean water from Danone Aqua in East Nusa Tenggara
(NTT), where the program 1 liter to 10 liters of clean water access, and easier to get clean
water from a distance of 2 kilometers to 500 meters. The program was a success.Danone
Aqua considered able to maintain and preserve the environment with clean water access
programs as well as environmental sanitation and improve the health of the Indonesian
family. And Danone Aqua able to overcome obstacles in the provision of access to clean
water is difficult, either by distance or time, and the provision of hygienic sanitation facilities
to the public.

After knowing the Corporate Social Responsibility program of AQUA DANONE we can
analyze the conceptual of the CSR program it selves. There are three concept of CSR which
are:

• CSR as Social Obligation

• CSR as Stakeholder Obligation
• CSR as Ethics Driven
• CSR as Managerial Processes
According to their programs which already mention above, we understand that their CSR is
part of Social Obligation. According to Bowen (1953) defined CSR as the obligation “to
pursue those policies, to make those decisions or to follow those lines of action which are
desirable in terms of the objectives and values of our society.” According to Carrol (1979)
there are different types of social obligation which are:

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  economic obligations (be productive and economically viable)

 legal and ethical obligations (follow the law and acknowledged values and norms)

 philanthropic obligations (proactively give back to society)

Corporate Social Responsibility that done by AQUA DANONE is part of philanthropic

obligation. As we know AQUA is the leading company of bottled water industry, they have
an obligation to give a best service of water to the society. With giving their aids to the
society it will give a good impact for the company it selves. With doing this kind of activities
they are hoping to get a new paradigm from the society that AQUA DANONE is not only
looking for the profit but also give welfare to the society. This program also as approve to
the society that doing business we can still implement some ethical practice.

In current business activity doing CSR practice is necessary because Being responsible to
society means that businesses must be honest and fair in doing business in
general, and particularly to social environment.

CONCLUSION

The balance in the business world should be a major life grip. Getting high profit must also
be balanced with concern for the social and environmental impacts caused. That is the main
mission of the Danone Aqua. Danone Aqua provides maximum nutrition to the Indonesian
people, through the quality of drinking water.Corporate social responsibility program (CSR)
which is the main Aqua Danone provides easy access to safe water and environmental
sanitation program. It is a double commitment which was always held by Danone. The first
commitment is to run the business as possible to achieve success, and the second is a
commitment to social and community.

DANONE AQUA doing the philantrophic obligation because they are the leading company
of bottle water. When they try to give an aid to the society it means that they are care with the
environment. Te other reason is to give a new paradigm for the society that doing business
can be combine with ethical activity. There are still many companies have a perspective that
we cannot combine between business and ethical behavior.

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REFERENCE

http://www.aquadanone.com

http://www.wikipedia.com

Waouww, Nicolas, Social Environment: Corporate Social Responsibility and Business.

Universitas Gajah Mada