Grayling estimates the total Russian corporate social investment volume to be at 4% from revenues. The social responsibility expenses are not evenly distributed between large and medium businesses. Being the country’s largest taxpayer, for example, Rosneft also spent up to $1B every year on social programs.
It is fair to say that Russian companies invest into social programs no less than American and European business. Western companies’ social investments are estimated at 1% of revenues (according to the Report of social investments in Russia by the Managers Association in 2004).
Therefore Russian business invests a lot into various “corporate social responsibility” programs. However, whether these investments work as a substitution for government social obligations remains to be seen.
Private donations market
Relatively small volume of corporate social investments in the US and the UK is partially justified by enormous activity of private philanthropy. In the US the annual volume of donations is estimated at $250B: 75% of them are from private sources and only 5% from corporate ones (that gives us 1% of revenue, as mentioned above). And it is quite the same in the UK: total budget of all country’s charity organizations reached 35B GBP in 2003/2004, while the corporate charity was estimated at 900M Pounds or 0.5% of revenues (“Money and Charity”, July 2007, № 3 (64).
Private donations market in Russia is significantly smaller, but it is growing rapidly. According to Coutts (Russian Federation data from Million Dollar Donors Report, Coutts Institution), 2013 showed significant growth in private donations comparing to 2012 ($1.1B collected from 126 philanthropists and $239M from 35 donors respectively). Private donations were estimated at 30% of total number and 55% of total volume. Half of all donations by number were made by corporate donors (63 of 126); however the total volume of corporate donations was estimated at 38% or $1.1B. It is of note, that $135M in private donations were made by Russian citizens for recipients in foreign countries, including US, Israel, Germany and the UK.
Non-money investments into social development
It’s hard to evaluate volunteering activities using financial indicators. At the same time volunteering is a natural element of private and corporate social responsibility. Inventing their own forms of activity people in Russia go beyond copying western volunteering practices. Here it makes sense to mention the "70 Years of Victory in Great Patriotic War” all-Russia volunteer corps. Various volunteer teams, members of the “Union of volunteer organizations and movements”, implement many projects across all Russia in respond to public needs.
Volunteering is a form of social investing, where participants donate their time instead of money. Today volunteering is a natural part of private and corporate social responsibility in Russia, and it will pay even greater role in future country’s transformation.
Russian business’s social obligations are growing facing the fact that the Government experiences shortage in cash to perform its promises, especially in the regions. In current situation local business pays greater attention to:
Improvement of social expenses efficiency,
Innovative and proactive approach to implementation of corporate social responsibility policies,
Getting synergy from joining resources with the Government, business partners, NGOs and volunteer organizations.