Abstract:

According to Indonesian Government Act 40 of 2007 on Limited Liability Company (LLC), especially in Chapter V Article 74, all enterprises in Indonesia must allocate their budget to Corporate Social and Responsibility (CSR) programs. The cost for Social and environmental responsibility program is calculated as the cost of the company's implementation with regard to the appropriateness and reasonableness. The implementation of CSR program in State Owned Enterprise (SOE) is not always smoothly run as planned since CSR managers often do not equipped with better mapping strategy to targeted CSR programs as well as standard operating procedure (SOP) in line with the enterprise’ s core business. A clear SOP is necessary for CSR executions since it involved significant amounts of fund, report and responsibility mechanism as well as the effective impacts to the communities. CSR managers are often in dilemma due to lack of clarity in terms of ineffective program targeting and merely responsive to the philanthropy activities or/and natural disaster charity programs. Many current CSR programs are implemented based on managers’ intuitive responses. A good and sustainable CSR program should be well planned and strategically organized.