The Magazine of Corporate Responsibility

Social Responsibility in Russia: Yesterday, Today…and Tomorrow?

Moscow-based consultant Tatiana Klimova provides services related to communications, corporate culture and corporate social responsibility issues. She is also a volunteer for several Russian not-for-profit organizations. In the following article she discusses social responsibility in Russia: its historical prerequisites, current dramatic changes and further development issues.

by Tatiana Klimova

In July 2012, in the southern Russian town of Krymsk, a huge flood took the lives of 172 people, as raging waters destroyed houses and ruined all the belongings of tens of thousands. Within days and even hours, ordinary citizens organized aid collection points all across Russia. Money was collected to arrange for delivering aid; tons of humanitarian goods were collected and delivered without any participation of the state. The tragedy united people and strengthened their understanding that “nobody else can help.”

Civilian volunteers unloading donated goods following the flood in Krymsk, Russia. (July 10, 2012)

The Krymsk flood is but one example of an emerging sense of social responsibility in Russia. Such substitution of the functions of the state by the civil society not only commands respect for the Russian people but also casts reproach as the state continues to lessen its responsibility for the social sector.

It has not always been this way. The long process of building socialism in Russia led to a complete washout of such phenomena as social responsibility and charity from our culture. Russia, which used to be a country of patrons, turned into the Soviet Union, where the Government and the Party were responsible for everything. There was no entrepreneurial activity in the USSR, and thus, the issue of corporate social responsibility never arose. Meanwhile, most citizens had only a subsistence minimum to spend and no opportunities or needs to influence the processes of managing the country’s social problems.

When democratic institutions first appeared in Russia, the situation started to change slowly but consistently. Entrepreneurial activity at the capital accumulation stage was mainly of a criminal nature, so the emerging topic of charity was marked with a black trail of fraud – the newly-established funds were often used to hide money laundering schemes.

Thinking of the Soul

The first early signs of genuine social responsibility involving business appeared at the end of the 1990s, with the most public examples being  some actions taken by the notorious oil company Yukos, which was deeply involved in modernising the social infrastructure of the region where it had operations.

But private civil initiatives didn’t really begin to flourish until the 2000s, when responsible business people began to move into legitimate businesses and “thought about their souls” (an old expression describing Russian people who became so well-off that  they began to donate money, since they believed that it ensured the welfare of their soul after death). Having looked around, they saw the pitiful state of the social sector, which had not been taken care of after the USSR disintegration. Thus, patronage returned to Russia: private and corporate donors renovated churches and museums, supported orphanages, and gave grants to theatres, sport and music schools. At the same time the first charity funds were launched, to address various social problems.

Now, a decade later, there are a considerable number of respected funds trusted by the public, though many are still wary of charitable organizations. The honest funds build their reputation little by little by demonstrating real outcomes of their work, keeping detailed publically-available reports, winning citizens’ trust and motivating people to participate in resolving social problems.

This process would have eventually allowed for transition from quantity to quality for charitable organizations, but a nationwide scandal prevented that from happening. A non-profit organization called The Federation Fund implemented a scheme that attracted enormous resources, not available to other private funds (free indoor advertising, benefits, etc.), invited Western stars to participate, and collected a lot of money that never reached the needy. Moreover, in its advertising campaign the fund acted far beyond the limits of ethics; for example, its ads featured a picture of a sick child who had died two years earlier. When the story became public, the fund made improvements (some money reached those for whom it was intended) but trust in the notion of charity in general, that had been so carefully built over such a long time, was ruined again among the general public.

Another aspect of charity has generated debate. For example, the actress Chulpan Khamatova – co-founder of the charity fund Gift of Life (a highly respected fund in Russia that helps children suffering from cancer and other life-threatening diseases ) -  is often criticized because her fund deals with issues that should have been tackled by the state; the argument is that charity funds like Gift of Life grant to state authorities a sort of “amnesty” from addressing social issues in the future.

Challenges Ahead

Despite these trust issues, Russian society is getting more and more involved in resolving social problems. Today in Russia, the level of corruption and the inefficiency of state management in social, human rights and other areas has reached a critical level: our society understands that the state cannot protect from anything or help in a difficult situation. Thus, voluntary work has started to develop rapidly in Russia. People get together to help orphanages, to extinguish forest fires, to search for missing children, to protect the unjustly convicted, etc.

In addition to civil initiatives, corporate social responsibility has also recently started to develop within some Russian business, and for a number of reasons has even become “fashionable.”  When Vladimir Putin was Russia’s Prime Minister (he is now President) he argued that corporate social responsibility was a necessity. Thus, state corporations actually received a “top down” order to allocate money for supporting socially relevant initiatives. At the same time, Russian companies strive to work in the international environment and to comply with world standards of civilized business that imply corporate social responsibility practices. Companies have turned to lean manufacturing methods that decrease damage to the environment, started to support local communities and social institutions, and to implement volunteering practices among their personnel.  Those are signs of an optimistic trend for potentially resolving some really grave issues of Russian society through the joint effort of business and citizens.

However, some actions taken by the State Duma have brought a number of unpleasant surprises for social responsibility initiatives. One is a new law that requires non-profit organizations financed from foreign sources and engaged in political activities to be designated as “foreign agents” - and to have to disclose that everywhere - as well as report according to stricter requirements. This new law is based on common international practice but the form of its adoption hurts all non-profits, not only those that seek to influence political processes. Even funds that help ill children are designated as “foreign agents” because they also participate in political events to attract money and attention to relevant issues, and are financed from abroad (often by Russian compatriots, living in other countries). For these charitable funds, reporting is not a problem – good, honest funds have always been transparent to the utmost in their reports. However, how can they win citizens’ trust (still very unstable, as I have noted earlier) if they have a “foreign agent” stigma?  A foreign agent in Russia is surely a spy and nobody likes spies here due to our historical mentality.

There is another legislative initiative being prepared for the Duma that could decisively destroy the tradition of helping fellow citizens – and that’s the law on volunteering.  Preliminary drafts of the law would prevent citizens from uniting without a legally registered organizing entity and agreements stating mutual responsibility.  If this law is adopted in its current form, it could eliminate the flow of those people who spontaneously got together because their heart called them to clear the rubble in Krymsk or to look for children who got lost in Siberian forests. There will be far fewer people who visit children’s institutions or clear nature reserves, because they won’t fancy being involved with red-tape.

My eternal optimism makes me believe in the triumph of the mind. The Russian people have been taught by our history to find a way out even in the most hopeless situations

In the recent 2012 Christmas and the New Year’s season, for example, one could see the growing tendency of business companies to direct their resources to charity rather than spend money on meaningless gifts and souvenirs.  Instead of gifts, partners and clients received greeting cards which stated money had been donated on their behalf to particular charities.  Reaction to such campaigns is totally positive. People feel better when they are involved in doing good instead of being given knickknacks that everybody is tired of.

Time will show what lies ahead of our country in the future. However, it is certain that social responsibility in Russia is getting more and more mature and urgent.

Photo: by Ilya Schurov, via Flickr.

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