Formulation Model of Corporate Social Responsibility (CSR) Oriented Strategy in Increasing the Company Performance

Abstract

This research is based on the reality conditions of Corporate Social Responsibility (CSR) activities which are identical with generic CSR programs. So far, many companies have implemented CSR on the basis of external pressures, such as; regulators, environmentalists and other associations. CSR implementation is not internal awareness of the company to contribute to improve social environment, and hasno relation with main activities and company strategy, so give no benefit contribution either to company performance or competitiveness. The research focus is to develop concept of CSR implementation based on the company's internal awareness, by investigating the leader behavior in formulating corporate strategy which is oriented to corporate social responsibility (CSR) in order to increase the company's performance through the CSR implementation that is integrated to company strategy. This study will be conducted at the Makassar Industrial Area (PT KIMA). The research analysis unit is company. Respondents were sampled as many as 81 leaders of general manager level and leaders at functional manager level of the company. The analytical method used to test the hypothesis is a variance based Structural Equation Model (SEM) with the Partial least Square (PLS) program. The perspective of employees, customers, investors, communities, environment and the perspective of suppliers in the implementation of corporate social responsibility (CSR) give real contribution toward corporate performance improvement as measured by the perspectives of the balanced scorecard (BSC).