SOCIAL ENTERPRENEURSHIP AND LEADERSHIP

Field Trip: CSR PT. Star Energy Geothermal

Afiz Zulfahmi 29116478

Dewi Almira Darmawan 29116449
Camelia Rizki Agrina 29116353
Rizky Adhim P 29116445

MASTER OF BUSINESS ADMINISTRATION

SCHOOL OF BUSINESS AND MANAGEMENT
INSTITUT TEKNOLOGI BANDUNG
2017
 CHAPTER 1
INTRODUCTION

1.1 Background

CSR aimed at encouraging company to be more aware of the impact of their business
on the rest of society, including their own stakeholders and the environment. Corporate
social responsibility (CSR) is a business approach that contributes to sustainable
development by delivering economic, social and environmental benefits for all
stakeholders.
CSR is a concept with many definitions and practices. The way it is understood and
implemented differs greatly for each company and country. Moreover, CSR is a very
broad concept that addresses many and various topics such as human rights, corporate
governance, health and safety, environmental effects, working conditions and
contribution to economic development. Whatever the definition is, the purpose of CSR is
to drive change towards sustainability.
Although some companies may achieve remarkable efforts with unique CSR
initiatives, it is difficult to be on the forefront on all aspects of CSR.

1.2 Observation Purpose

The purpose of these observations is as follows:

1. Understand the overall corporate strategy as the planning stages, execution,
implementation, evaluation, and controling
2. Understand the perception of patrons existing patrons in the community
development area
3. Analysis of students ' practical to design development strategies area

1.3 Observation Methods

Observation methods used to draw up this report is by way of FGD (Group

Discussion Forums) and the patrons are there in the region representing from NGOS
(nongovernmental organizations). With NGOs which consists of:
1. Remaja Aktif Positif (REAKSI)
2. Pecinta Alam (TAPAK TIARA)
3. Generasi Bebas Narkoba (GBN JABAR)
 CHAPTER 2
BASIC THEORY

2.1. CSR

2.1.1. The Definition Of Corporate Social Responsibility (CSR)

Corporate Social Responsibility (CSR) is an ongoing commitment by the business

world to act ethically and contribute to economic development of the local community or
the wider community, at the same time with an increase in the extent the life of workers
and their families (Wibisono, 2007, p. 7). There are several other definitions regarding
CSR as described by Christine A Hemingway & Patrick W Maclagan in Journal of
Business Ethics (2004, page. 33-44).
a. Corporate Social Responsibility requires companies to acknowledge that they
should be publicy accountable not only for their financial performance but also for
their social and environmental record. More widely, the CSR encompasses the
extents to which companies should promote human rights, democracy, community
improvement and sustainable development objectives throught the world. (The
Confederation of British Industry)
b. Identifies four components that need to be present in order for a business to claim
it is socially responsible; economic, legal, ethical, philatrophic responsibilities
(Caroll)
c. Corporate social responsibility refers to managements inligation to set policies,
make decisions and follow courses of action beyond the requirements of the law
that desirable in terms of the values and objectives of society (Moseley)
d. Corporate social responsibility may be viewed as a process in which managers
take responsibility for identifying and accomodating the interest of those affected
by the organizations actions (Maclagan)
e. Socially responsible actions by a corporation are actions that; when judged by the
society in the future, are seen to have been of maximum help in providing
necesssary amounts of desired goods and services at a minimum financial and
social cost, the U.S. distributed equability u.s. possible (Farmer)
There is many definitions of CSR, one of which described CSR in Indonesia are
Suharto's definition (2006) stating that CSR is a business operation that is committed not
only to increase profits the company financially, but to build the socio-economic area work
holistically, and sustainable. From this definition, we can see that one of the aspects in
the implementation of CSR is a commitment to sustainable local community prosper
within the local community.
Related to corporate social responsibility area, Organization Economic Cooperation and
Development (OECD) in Wibisono (2007, p. 42) agree on guidelines for multinational
corporations in implementing CSR. These guidelines contain public policy, including:
1. To contribute to the advancement of economic, social and environmental viewpoint
in order to achieve sustainable development,
2. Respect for human rights that are affected by the activities of the company which
is run in line with the Government's commitments and obligations in the countries
where the company operates,
3. Encourage local capacity building through close cooperation with local
communities, including business interests, in addition to developing the company's
activity in the market and abroad in line with the needs of trade practices,
4. Encourages the formation of human capital, in particular through the creation of
employment opportunities and facilitate training for employees,
5. Refrain from seeking or accepting exemptions not beyond that allowed by law
related to the social environment, health and safety, labour, taxation, financial
incentives, and other issues,
6. Push and hold fast to the principles of Good Corporate Governance (GCG) as well
as develop and implement practices of good corporate governance,
7. Develop and implement management systems practices that govern themselves
effectively in order to menumbuhkembangkan the relationship of mutual trust
between the company and the communities where the company operates,
8. Encourage awareness of workers in line with the company policies through the
dissemination of information on the policies it on workers including through training
programmes,
9. Restraint to not do action slash select (discriminatory) and indispliner,
10. Develop business partners, including suppliers and sub-contractors, to apply the
rules of the company in line with these guidelines,
 11. Be abstaining involvement towards all that is not fitting in local political activities.

2.1.2. CSR Benefits

There are the benefits derived from the implementation of corporate social
responsibility, both for the company itself, for the community, the Government and other
stakeholders. Wibisono (2007, p. 99) outlines the benefits that would be received from
the implementation of CSR, including the following:
1. For the company. There are four benefits that accrue to the company by
implementing CSR. First, the existence of company
2. Deserve a social licence to operate. People around the company is the main
community enterprises. When they get a benefit from the existence of the
company, then certainly by itself they have felt to have company. As a reward is
given to the company at least is the discretion of the company to run its business
in the region. So the CSR programs are expected to become part of the social
insurance (social insurance) that will generate a positive perception of harmony
and of society towards the existence of the company.
3. Reduce the risk of the company's business. The company must be aware that the
failure to meet the expectations of stakeholders will become a time bomb which
may trigger unexpected risks. If that's the case, then in addition to bear the
opportunity loss, companies also have to pay costs that may be doubled compared
to the magnitude of the costs for implementing CSR.
4. Expand access to resources. A good track record in the management of CSR is a
competitive advantage for companies that can help to smooth the way towards the
necessary corporate resources.
5. Expand access to the market. Investments that are cultivated for CSR program
can be a ticket to the company towards a market opportunity is wide open.
Including going to cultivate the loyalty of customers and penetrate new market
share.
6. Reduce costs. Many of the examples that can illustrate the advantages the
company obtained from the cost savings that are the fruits of the implementation
 of the implementation of its social responsibility program. An example is the effort
to reduce waste through a process recycle or recycling into the production cycle.
7. Improve relations with stakeholders. The implementation of CSR programs will
certainly increase the frequency of communication with stakeholders. The feel like
it can spread out the red carpet for the formation of the trust to the company.
8. Improve relations with regulators. Companies that implement a CSR program in
essence is an attempt to lighten the burden of the Government as a regulator.
Because the government which became the main responsible for the prosper
community and preserve the environment. Without help from the company, are
generally too heavy for the Government to bear the brunt of it.
9. Improve the morale and productivity of employees. Welfare given the actors of
CSR generally already far exceeds the standard normative obligations charged to
the company. Therefore it is natural when employees are being encouraged to
improve its performance.
10. award winning Opportunities. Many reward offer for actuator CSR, so the
opportunity to get the award have the opportunity which is quite high.

2.2. Communinties Prosperity

According to Walter a. Friedlander (1961) social welfare is an organized system of

social services and institutions which aims to assist individuals and groups to achieve the
standard of living and a satisfactory health and personal relationships and social which
allows them to develop their ability to all possible and increase the prosperity are aligned
with the needs of families and communities.

According to Arthur Dunham (1965) social welfare defined as organized activities

with the aim of improving the well-being of the social through the granting of aid to the
people to meet the needs in the some fields such as family life and children, health, social
adjustment, spare time, standards of living and social relations. The Ministry of social
welfare to give the main concern against the individuals, groups, communities and entities
the wider population; This service includes maintenance or care, healing and prevention.
 Harold l. Wilensky (1965) defines social welfare is a system that is organized from
the efforts of social service and social institutions, to assist individuals and groups in
achieving the level of life and health satisfactory. The intent is to let individual social
relationships and gain the opportunity to develop and accumulate the existence of
increase or improve our well-being as humans in accordance with the needs of the
community.

Alfred j. Khan (1973) States that the social welfare consists of programs that are
available other than those covered in the criteria of the market to secure basic needs an
action such as health, education, welfare, with the aim of increase the degree of
communal life and proper functioning of the individual, so you can easily use the services
as well as the existing institutions in General as well as help those who experience
difficulties and in the fulfillment of their needs.

Then according to Zastrow (2000) social welfare is a system that includes

programs and services that help people in order to meet the needs of social, economic,
education and health are fundamental to maintaining the community. As the limitations of
the UN, social welfare is organized activities purpose to help individuals or communities
to meet the needs of base and improve well-being in harmony with the interests of the the
family and the community.

According to the legislation of the Republic of Indonesia number 11 year 2009,

social welfare is a condition of material needs, satisfy their spiritual, social and citizen in
order to be worth living and able to develop themselves, so that it can carry out the
function of social, and social welfare is conducting its directional, integrated, and
sustainable Government, local governments, and the public in the form of social services
to meet the basic needs of every citizen, which includes social rehabilitation, social
security, social empowerment, and social protection. Where in reality is done on the basis
of solidarity, justice, benefit, integrity, partnership, openness, accountability, participation,
professionalism and sustainability.
 CHAPTER 3

PROBLEM ANALYSIS

After FGD with NGOS comprising Remaja Aktif Positif (REAKSI), Pecinta Alam
(TAPAK TIARA), Generasi Bebas Narkoba (GBN JABAR) obtained results, namely:

1. Problems faced by NGOS in pangalengan

2. Perception of NGOs about prosperity
3. NGO perspective about what should be done
4. The concept of NGOS against the real effort that will or are the NGOS are
doing to develop the territory
5. Perspective of other patrons of the role of NGOS to develop the territory
3.1. The problem faced by NGOS on site

There are some observations on the problems that occur at the site of the research,
such as: burning forests to change the forest became farming land, instead of the
commodity, the social gap, and the surrounding communities became laborers. Seen
from the above problem is an issue that is sometimes found in other areas, however, will
be different from the way to solve on other place. The problems in the tourism area been
found in competition ranging from price competition and the destruction of the attractions
by the other competitors (possibility). Then the NGOS are also facing problems is still the
number of young people who consuming drugs in the form of glue.

3.2. NGOs perception about prosperity

Based on observations results of FGD perception from NGOS about the welfare
of the area still less because of the existence of social inequalities still according to NGOS
is still much in the area. As there are still many who became workers and others who
became successful businessmen, who made no share of the wealthiness of the area. The
issues facing these social prosperity because of the community that still trouble in capital
to run the business.
3.3. NGO perspective about what should be done

Based on the results of the FGD to NGOs, obtained as a result of NGO views on
what should be done to the problem that in the face of the area that is more to the society
in the area due to the community in the area wanted Instant thing, unwilling to distress
and unwilling to attempt. But when community there want more trying, social disparities
and wealthiness in the area will be easier to be solved.
3.4. The NGOs Concept to developing the area

Based on the results of the FGD to NGOS in the area obtained the result of a
concept is being developed for the NGO area is as follows:
1. Increase tourism area in pangalengan such as water sport (rafting), climbing, dairy
tours, ecotourism (area of pine forests and tea gardens) and extreme sports
2. Treatment of water, reforestation, cooperation with PT. Gheotermal Star Energy to
develop the forest functions
3. Socialization effects of drugs to the public
4. The separation of garbage and junk treatment.
5. In cooperation with the manufacturer
6. Try to make landfill due there is no landfill in Pangalengan

3.4 NGO perspective about the role of other patrons to develop its territory

Based on the results of the FGD, the view of other patrons of the role of NGOS to
develop the area is quite good in some of the patrons. As the role of the company, namely:
give scholarship to the employee about farm training and then contribute to the charity
event held by NGOs. The role of Government has also been quite good since "pungli
(pungutan liar)" has begun to wear off, close the minimart that exists in that location, but
for licensing is still hard to be done. The role of Nurkayana also had enough good will but
that many communities do not know the functions of cooperatives, and the lack of
dissemination to the public. Cooperatives in this area much of the bankrupt because the
public still consider money grants. The perspective towards the coperation also still
lacking because it is considered lost to compete with banks for reasons of ease to make
loan.
 CHAPTER 4
SOLUTION AND RECOMMENDATIONS

Solutions and recommendations based on the results of these observations in

order to develop the area is as follows:

1. Make socialization to society of a healthy business competition, so that small

entrepreneurs or people who want to start businesses can more easily develop
its business
2. Make the landfill with a capital of all elements of society in this area
3. Reduce the presence of thuggery of the area
4. Reaffirm the anti drug and exposing the socializing effect obtained when
consuming drugs in the area
5. Help to find suitable investors for small entrepreneurs and investors in the area of
tourism so that the economic disparity in the region more evenly
6. More frequent meetings to the patrons who are in these locations in order to
reduce the presence of strife against existing patrons
7. More often held a socializing and meetings between leaders of areas for mutual
support eco-tourism which can raise the level of well-being of Pangalengan area
 REFERENCES

Arthur Dunham.1965. Community Walfare Organization: Principles and Practice. New

York: Thomas Y. Crowell Co

Friedlander, Walter a. (1961). Introduction to social welfare.Prentice-Hall, 1961

Hemingway, Christine A. and Patrick W. Maclagan (2004). Managers personal values

as drivers of corporate social responsibility, Journal of Business Ethics, Vol. 50
http://lexicon.ft.com/Term?term=corporate-social-responsibility--(CSR)
Wibisono, Yusuf.(2007) Membedah Konsep dan Aplikasi CSR. Gresik: Fascho
Publishing,