Incentives are provided for companies that invest in impactful programs
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The long-awaited Investment Law was finalised recently after years of review by the government and private sector. The law was first passed in 1994 and amended in 2003 at a time where Cambodia’s economic development grew at a slower pace. Hence, the need to revisit the law to make it relevant to today’s context.
One of this is the amendment to include incentives for investments by private sector entities that uphold the principle of corporate social responsibility (CSR), Council for the Development of Cambodia (CDC) secretary-general Sok Chenda Sophea says, noting that the increntives are “quite generous” compared to other countries.
“In the draft, we have considered investment allowances for companies that spend money for staff accommodation, transportation, meals and hygienic food courts, and industrial training. In line with this, we would like share the cost. It is a proposal from CDC. (Having said that) I would not say the incentive is big or small but that it is generous,” Sophea says.
The council has made the proposal for Prime Minister Hun Sen to consider providing incentives to enterprises that look after the society and environment. Incentives to companies that implement CSRs would encourage them to do more.
However, he declined to disclose the incentive package that would be offered as it has yet to be approved by the premier.
CSR is a company’s way of giving back to the community by initiating efforts to share time, money and support through social, environmental or economic welfare programs that have a positive impact.
Some corporate firms become leaders in addressing environmental issues by implementing climate change initiatives and starting up various foundations that would promote their vision. Others support shelters and orphanages, serve meals to senior citizens, build houses, tutor children and plant trees.
The goal of CSR is often linked to fostering positive and meaningful developments, and not merely to add more funds to the executives’ pockets.
Hay Phirum, country head of Germany-headquartered Robert Bosch (Cambodia) Co Ltd tells Capital Cambodia that he is happy the government is paying attention to companies which implement CSR programs.
“Most companies do not know what CSR work can do for brand reputation. CSR is important for companies with long-term business plans. For us, CSR programs also ensure business sustainability. We mainly focus on skills advocacy and education in public universities and non-governmental organisations,” he says.
CSR efforts can also include changes in company policies, and reducing environmental impact.
European Chamber of Commerce executive director Blaise Kilian says that good CSR programs are attractive to potential investors, as well as shareholders while motivating employees. “It also has a positive impact on the company’s bottomline,” he adds.