Minority Chief Whip pushes for mandatory CSR law to foster sustainable development

The Minority Chief Whip has urged Parliament to enact a national Corporate Social Responsibility (CSR) law.

The Nsawam Adoagyiri legislator emphasised that voluntary CSR efforts in Ghana have led to inconsistencies and missed opportunities for national development.

Speaking on the floor of Parliament on March 27, he argued that Ghana must move beyond discretionary philanthropy and adopt a structured and binding CSR policy to hold corporations accountable for their social, economic, and environmental footprints.

“Corporate Social Responsibility is not just an act of charity; it is an ethical obligation for businesses to operate sustainably and contribute meaningfully to society,” he stated.

“Around the world, CSR is not merely a philanthropic gesture but a strategic imperative that fosters economic growth, social equity, and environmental sustainability. Ghana, however, has yet to fully harness its transformative potential.”

The MP highlighted global examples where legislated CSR frameworks have yielded significant benefits. He cited India’s Companies Act of 2013, which mandates CSR spending for large corporations, leading to increased investments in social programs.

Similarly, South Africa’s Broad-Based Black Economic Empowerment (B-BBEE) Act has promoted inclusive growth, raising black ownership of companies from 1.9% in 2001 to 23.3% in 2019 and creating over 500,000 jobs.

Other countries such as Nigeria, Kenya, Brazil, and Denmark have also implemented regulatory frameworks ensuring corporate accountability and social investments.

Despite some progress, Ghana remains behind in instituting a standardized CSR framework. The Ghana Chamber of Mines reports that the mining sector alone allocated over GH¢1.4 billion ($230 million) to CSR initiatives in 2020, up from GH¢1.1 billion ($180 million) in 2019.

However, the MP lamented that these efforts remain largely voluntary, with no mandatory reporting requirements to ensure transparency.

“The lack of a comprehensive national CSR policy has led to fragmented approaches, where companies implement sporadic initiatives instead of integrating CSR into their core business strategies.

CSR should not be seen as an afterthought or a public relations exercise, but as a fundamental aspect of corporate governance,” he stressed.

He further criticised the weak enforcement mechanisms in Ghana’s regulatory environment. According to the Ghana Chamber of Mines, 60% of mining companies were not subjected to regulatory inspections in the past year.

The Ghana Environmental Protection Agency’s 2020 report also revealed that the maximum penalty for corporate environmental violations is only GH¢10,000 ($1,700), a sum he described as “woefully inadequate” to deter infractions.

Citing the World Business Council for Sustainable Development (WBCSD), which ranks Ghana 114th out of 129 countries in stakeholder engagement, he underscored the need for structured regulatory interventions to enhance corporate-community relations.

To address these gaps, he proposed the following legislative measures:

• Mandatory CSR Reporting:Corporations should be legally required to disclose their CSR activities and financial commitments to ensure transparency and accountability.
• Standardized CSR Frameworks:Establish clear benchmarks for corporate social responsibility across all industries to promote uniformity.
• Stronger Enforcement Mechanisms:Empower regulatory bodies to monitor and enforce compliance, with stricter penalties for non-compliance.
• Stakeholder Engagement Requirements:Corporations must engage in meaningful consultations with local communities to ensure CSR initiatives align with societal needs.

“A national CSR law is not just necessary—it is urgent. It will ensure that corporate contributions go beyond goodwill gestures to become structured, impactful, and measurable investments in national development. I urge this House to take decisive action in institutionalizing CSR legislation,” he concluded.

His call signals a push for corporate accountability in Ghana and a step toward aligning CSR initiatives with sustainable economic and social progress.

Source: myjoyonline.com