Social business investments are managerial, technological, material resources. This category also includes financial assets of companies.
Main stream
All the above resources are spent on the implementation of special social programs. They are designed to meet the needs of external and internal stakeholders. It is assumed that, based on the implementation of these programs, a certain socio-economic result will be obtained. Next, we consider in more detail what relates to investments in the Russian Federation.
General information
Social investments are presented as a complex of enterprise expenses for special programs. It includes the costs of developing staff skills: vocational training and retraining, protection of health, labor and so on. Social investments are aimed at improving the environment, ensuring good commercial practices, and promoting local communities. Theoretically, the category in question should not include forced (regulated by law) program costs. However, in practice it is quite difficult to distinguish between compelled and voluntary costs. Social investments in Russia are closely related to corporate responsibility. The larger the volume of the first, the higher will be the second, as, however, and vice versa. Investments in the social sphere contribute to the formation of image and increase of business reputation. They act as long-term investments in intangible funds of companies.
Social investment performance
These investments, both in domestic and in Western practice, have a very beneficial effect on the business activity of companies. Social investments stimulate positive changes in society. You must understand that program costs cannot be considered charity. Social investments suggest a corresponding effect. Their payback period is quite long, while the present net cost is low. However, the return on these investments is expressed not only in cash. The result may be the building of trust and the formation of a positive image of the enterprise among the members of the community into which social investments were directed. According to the results of many foreign studies, ceteris paribus, people prefer to choose the company, which, in their opinion, is the most responsible to society. In the future, this choice goes into immediate action. In particular, people buy stocks, purchase services, goods and more. The immediate business benefits of social investment are:
- Formation of a stable commercial sphere.
- Increase the market value of the enterprise in the long run.
- Lower operational risk.
- Improving financial performance.
- Increase sales.
- Decrease in recruiting expenses.
- Increase in labor productivity.
- Expansion of the market.
Attachment Structure
Labor-intensive industries are primarily focused on domestic investment. This, in particular, the protection of health and staff development. At the same time, material and energy-intensive spheres are oriented more toward external costs: environmental protection, resource conservation. The above fact reveals the provision on the dependence of the size of investments on the specifics of the enterprise in a broad sense. Thus, light industry sectors pay more attention to working with their own employees. The enterprises of the "heavy" sphere are forced to spend money on resource conservation and environmental conservation. It should be said that external directions are mainly characteristic of the forestry, woodworking, chemical industries, as well as the service sector (including utilities). Internal costs, in turn, are borne, as a rule, by the electric power, engineering, trade, transport sectors, as well as companies producing consumer goods.
Quality aspect
It is associated with the assessment and taking into account the level of complexity and completeness of the process of implementation of social investments directly. The analytical and statistical embodiment of this aspect of the problem is the qualitative investment index. It actually allows you to determine the level of diversification of investments, the degree of information equipment, organizational support for planning and the subsequent implementation of expenses for social needs.
Qualification Criteria
In Russia, they are combined into three groups. They are based on the following indicators:
- The first group of criteria is the institutional design of socio-political processes. In this case, accounting is provided for the following items:
- the presence of a special document that secures the actions of the enterprise in the indicated direction (normative centralization);
- the existence of a special unit that is responsible for the implementation of programs by the company (organizational centralization);
- use of a collective agreement (regulatory framework).
- The second group of criteria is the accounting system of social events. Four positions are assumed here:
- annual preparation of financial statements, in accordance with international standards (standardization and unification of information);
- assessment of investment efficiency (providing feedback between the investor and investments);
- the presence of examples of programs (informing the public to transfer positive experience, promoting the reputation and image of the enterprise, self-promotion);
- introduction of global generally accepted standards into expenditures (information basis of socio-political activity).
- The third group of criteria is the complexity of implemented social investments. It provides for accounting in 5 areas of expenditure:
- to develop staff skills;
- the protection of labor and health of employees;
- environmental protection measures and resource conservation;
- on the development of local communities;
- to maintain fair business.
In accordance with the directions related to the last group, the principle of the maximum diversity of socio-political activity of companies is formulated, since the concentration of investments in the first two positions leads to imbalances in the development of the entire socio-economic system.
Information base for studying attachments
As a source of quantitative measurements of investments are the results of a survey of one hundred companies in the Russian Federation. The project was supported by the Government, the Ministry of Investment. Funding was provided by the UN Development Program. General coordination was carried out by the Association of Russian Managers.
Main problems
The main one is the complexity of the performance evaluation process. First of all, the effect is quite difficult to express in money. In addition, not in all cases it can be proved that a particular increase in indicators was the result of investments. Also today in Russia there are no clear and distinct criteria for analyzing corporate responsibility. There is no clear idea in society about what should be the aesthetic principles of modern commercial activity and what are the benefits of socially responsible actions. Today, there are no strict standards and requirements.