Brazil: Social Corporate Responsibility In Brazil: Making A Difference

In line with a worldwide trend, the corporate social responsibility has been a growing concern for Brazilian companies not only to improve their public image, but also, and especially, as a tool for social integration and community development.

If, during most of the 20th century, companies' concerns were essentially directed towards production efficiency and the pursuit of larger consumer markets and profits, with little regard for issues such as quality control, consumer rights, social and environmental management, today this conduct has become unthinkable.

Undoubtedly, the evolution of the Brazilian civil, labor, social security and environmental laws contributed to the inclusion of social and community issues in the Brazilian companies' concerns. Nonetheless, the growing influence of the public opinion and the undeniable strengthening of the bargaining power of clients/ consumers vis-à-vis a scenario of sharp business competition were and are still decisive factors for the higher social awareness of corporations.

In fact, for a certain time now, Brazilian companies have had their social obligations established by law - hence mandatory - intended to mitigate the social and economic problems afflicting the Brazilian population, such as: (i) contribution to the Social Security; (ii) payment of the Unemployment Savings Fund (FGTS); (iii) financing of the Occupational Accident Insurance; (iv) job quotas for the disabled, among others.

However, social actions required by law are almost fully restricted to the group of individuals regularly employed, yielding insufficient effects on the progress of the local community, in particular if we take into consideration the mass of Brazilian workers performing "informal" activities (those not registered with the Labor Ministry and the Social Security Ministry). Moreover, the mere compliance by a company with legal requirements is no longer a quality or differential that might be considered by the demanding consumer who now very much keeps a watchful eye on the companies' ethical and moral procedures.

Within this context, the social corporate responsibility has been reinforced by initiatives not linked to legal impositions, which, it should be emphasized, have been achieving good results and greater efficiency in reducing the Brazilian social and economic differences.

It is also important to note that, by and large, the Brazilian society has been realizing that the State is not able to meet the basic needs of the entire population - hence it has become essential for the community to share with the private initiative the responsibility for solving the country's problems; that brought the focus to the companies, which have greater economic and structural capacity.

Initially, social actions by the Brazilian companies were limited to donations of goods to local communities, and as they were not further committed to instigating a social improvement process, their activities were similar to those of charity entities.

Along with the maintenance of corporate policies of mere social assistance, currently most of the companies have been extending their social actions by including other policies and practices that may in fact generate more effective responses towards social inclusion and justice.

Brazilian companies have been focusing their social actions especially on the following areas: (i) relationship with local organizations; (ii) combat of corruption and bribery; (iii) eradication of children labor; (iv) environmental education; (v) valuation of diversity and equal opportunities in the workplace; (vi) participation in governmental social projects; (vii) social leadership and influence; and (viii) acknowledgment of potential damages that may be caused by products and services, and management of companies' impacts on the local communities.

In November 2003, a research by the Federation and Center of Industries in the State of São Paulo ('FIESP/CIESP'), the Brazilian leading entrepreneurial pole, showed that the Brazilian companies' most common social activity is in the young - and preschool- children area (0 to 6-year-olds), followed by youngsters' education and orientation, foodstuff, social assistance and health areas, respectively.

This information discloses that Brazilian companies are mainly committed to filling the gaps stemming from the State's omission in the most essential areas for social inclusion, i.e., education, food and health.

The results of such actions are worth mentioning, as shown by the research conducted by 'FIESP/CIESP'. In this regard, according to the perception of the industries involved in the research, these social actions improved the company-community relationship, the employees' involvement with the company and the living conditions in the community. Clearly these actions have effectively helped to mitigate or solve local social problems.

Hence, fortunately, Brazilian companies are being compelled to rethink their position vis-à-vis the community and seek a more balanced attitude in relation to "productivity and profit" vs. "employees and community". Better than that, the results of this change of mentality have been showing that this attitude is beneficial not only to the community, but to the companies themselves, not to mention to the economy as a whole.

In summary, in a globalized economic and business environment, the goals of higher productivity and profitability are intrinsically connected with the fight to allow that more people in the world have better living conditions and access to modern technologies and products. Specifically in regard to Brazil, the sustainable, continuous and stable growth will require that the companies' initiatives towards the social responsibility are intensified, and, at the same time, that the Federal Government makes heavy investments in this area.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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