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  • Subject area(s): Business
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  • Published on: 21st September 2019
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The King Code of governance principles covers various sections within the suitable governance of South Africa. However, in this article, only the sections which serve relevant to social responsibility in South Africa have been discussed. This article firstly discusses the importance of social responsibility in corporate South Africa according to the king code of good governance. Furthermore, examples have been used which were collected from South African news reports regarding issues in social responsibility to showcase what the King Codes take is on the issues of note.

The following writing encompasses the legal framework for corporate social responsibility in South Africa, also known as CSR. CSR refers to the generally voluntary involvement, or investment, of companies in social projects that help advance the society / the community in which they operate in areas such as health care, housing, education, safety, and the environment, among others. (Micaela Flores-Araoz, 2011). Due to South African history,  (Apartheid in specific), South Africa is home to various inequalities. These inequalities include education, infrastructure, basic service access, and economic power. (1) Although the South African Companies Act 61 of 1973 does not oblige companies to engage in CSR projects, the country's Policy Document and the King II and King III reports explicitly address the need and relevance for corporations to acknowledge all stakeholders. (2)

According to research, not all CSR efforts in South Africa result from voluntary or indirect business decisions; some of them are the product of corporate compliance with the Black Economic Empowerment (BEE) legislation.(3) The BEE Act forces South African-based companies to consider all stakeholders when performing their internal and external operations in an effort to eradicate social and economic inequalities inherited from the Apartheid days and to help previously discriminated groups to actively participate in the country's economy.

Apart from being prompted by organisations and legislations to actively part take in corporate social responsibility, companies are generally starting to take an interest voluntarily. This is due to the long term effects and gain the act of corporate social responsibility will have on the company. The involvement of CSR by the company could increase company productivity, profitability and share value. (4)

The King Code III report addresses this involvement along with other sections, namely: ethical leadership and corporate citizenship, boards and directors, audit committees, the governance of risk, the governance of information technology, compliance with laws, rules, codes and standards, internal audit, governing stakeholder relationships and integrated reporting and disclosure.

Having recognised and understood what corporate social responsibility is, the following passage discusses examples of CSR in South Africa.

Companies in South Africa have engaged in social responsible behaviours in many ways. For example, BHP Billiton ( a global leading mining company), relies on BHP Billiton Development Trust South Africa to implement, coordinate and manage various sustainable development initiatives. BHP relies on the Trust in the areas of education and training, capacity building, socio economic development and health care.(5)

Different mechanisms have been developed by BHP Billiton Energy Coal South Africa to protect the environment. These mechanisms were developed to enhance the safeness and security of their employees, to support the community and to empower individuals (including women) to participate and profit from local mining and energy activities.(6)

'CoAL', a coal mining and development company Coal of Africa, has also taken part in different ways to show their commitment in South Africa and with the protection of the environment. In 2009, CoAL committed to spend R500 m (over USD 70m) over thirty years in social and environmental projects, and to promote local employment through its Vele coking coal project (expected to generate 30,000 direct and indirect jobs).(7)

The following 9 sustainability development priorities have been set by SAB Miller, and its South African subsidiary SAM Ltd (the biggest brewing company in SA) as part of their social responsibility global policy: 1. HIV/AIDS, 2. human rights, 3. waste, 4. packaging, 5. responsible drinking, 6. water, 7. energy and carbon, 8. enterprise development and, 9. transparency end ethics. In South Africa, for example, they have made important improvements in the areas of waste management, communities and, transparency and ethics over the past couple of years. They are still progressing in the areas of responsible drinking and, energy and carbon emissions.(8)

Standard Bank has also contributed hugely in terms of CSR. In 2010, the Group's corporate social investment amounted to ZAR 132,3m. The breakdown in South Africa indicates that 36.4% went to education programs and 35.5% to enterprise development. The company has a keen interest in the helping of developing the future for the next generation. The result of their involvement improves thousands of lives in terms of quality of life, educational knowledge and application and the inclusion of previously disadvantaged candidates. (9)

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