Regulatory on the corporate social responsibility in the context of sustainable development by mandatory in the world trade organization law
Regulatory on the corporate social responsibility in the context of sustainable development by mandatory in the world trade organization law

Summary/Abstract: Regulatory on the Corporate Social Responsibility (CSR) by mandatory in Indonesia as stipulated in Article 74 of Law No. 40/2007 on the Limited Liability Company (hereafter the Company Law) raises a contradiction. Those who agree argue that the company is not solely for profit, but more than that are participating in social issues and the preservation of the environment within the framework of sustainable development. Conversely, those who disagree view that social issues and the environment are the full responsibility of state. The involvement of a corporation in social and environmental activities is voluntary. Verdict of the Indonesian Constitutional Court in case no. 53/PUU-VI / / 2008 dated 13 April 2009 which rejected a requesting of material test of the Article 74 paragraph (1), (2) and (3) of the Company Law confirms the existence of the CSR by mandatory in international trade traffic today. The analytical results indicates that mandatory CSR regulation in the Company Law is not a form of a state intervention to the private activities. In addition, the arrangement is not contrary to the principles of free trade within the framework of the General Agreement on Tariffs and Trade (GATT) / World Trade Organization (WTO).

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