Corporate social responsibility regulation and its adoption by transnational corporations in Indonesia: the case of Chevron Indonesia

This study aims to discuss the adoption of corporate social responsibility (CSR) regulations by companies in their efforts to expand while remaining community-based and eco-friendly business entities. Corporate social responsibility has become an important area of activity within the global business community and actors. Governments, businesses and the communities are involved in shaping and implementing CSR policies and related laws. However, how CSR-related laws can be adopted and implemented remains unclear and the subject itself is still under-represented in research. This paper endeavours to answer the question as to how CSR regulations are adopted into business strategies and how they are implemented by transnational corporations in Indonesia. The study found that Indonesia is strongly committed to the implementation of CSR by companies through the enactment of Law No. 40/2007 on Limited Liability Company and other CSR-related policies. Consequently, the study also reveals that the enactment of this law and other related policies has no significant impacts on Chevron's business strategy since it has been implementing these measures long before they were even incorporated into laws. This study suggests that for the sake of efficiency, CSR policies must comply with social norms and values.