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By Nor Ellya Ezamal


Corporate Social Responsibility (CSR) is how companies around the world make a positive impact on the community around them. Learn reasons why CSR is relevant to a company’s growth.

These days, companies have been showing more interest in exercising their Corporate Social Responsibility (CSR).


CSR or Corporate Social Responsibility is the company engagement with the community to conduct the environmental, social and economic effects activities that enrich the community. Essentially, it is a means for companies to “give back to the community”.


Below are 3 reasons why CSR is relevant to a company’s growth.

#1. Encourages Social Responsibility Within the Organization


Social responsibility is the accountability of an individual or organizations to act in a manner that contributes positively to the development of the environment or surrounding community. By doing so, their actions support the long-term growth of society.


CSR, or corporate social responsibility, is the social responsibility of businesses to ensure that their operations do no harm but rather bring benefit to the environment and surrounding community.


While the goal of social responsibility is to ensure that an individual or a social organization does not harm, but rather benefits society and the community, the goal of corporate social responsibility is to ensure that the business corporation benefits as well.


At the same time, individuals within the organization get to exercise their social responsibility when participating in CSR activities. Employee volunteering is a necessary component of any CSR program. It can certainly make or break it. Providing employees with this opportunity to carry out and derive satisfaction from social responsibility activities is a less obvious aspect of Employee Value Proposition (EVP), which are the benefits an employee reaps from being employed by a company. A satisfied employee is an employee who is more likely to have positive thoughts and feelings about their continued employment.


To put CSR into motion, businesses engage in philanthropic activities, volunteer initiatives, environmental protection programs (including the implementation of green business policies), and ethical labor practices (treating employees fairly and ethically).

As a result of this desire to “give back to the community”, businesses demonstrate accountability to its own stakeholders, employees, customers, as well as the public. This creates an environment of collaboration, thereby creating trust. In return, this raises productivity and corporate income.

#2. Improves Your Company Brand Value


When we think about company and corporate branding, the first thing that comes to mind is the use of a logo, a tagline, and a name that is exclusive to that organization. A company’s brand, according to experts, is its promise. It reflects what the company can offer its consumers in terms of goods and services, as well as what they can expect from those products and services. It sums up their customers’ impressions of them. After all, branding has only one goal: to give a corporation, industry, organization, product, or service a name and image.


There is a relationship between the company branding and the company’s CSR initiatives. With well-placed CSR initiatives which are carried out successfully, a company’s reputation is enhanced. In turn, this effectively brings more value to the company’s brand.


Brilliant CSR initiatives brings positive press for companies. The media plays an important role in informing the broader audience of the company’s good works. For all intents and purposes, successful CSR promotes the business.


The right CSR initiative can set a company above a competitor, but only when they can managed the CSR properly. Marketing, publicity, execution, and above all the true benefit the community can receive from the CSR.

#3. Opens New Opportunities


Many companies are now using CSR as a method to gain the confidence of their stakeholders and consumers. This is because CSR is a form of corporate self-regulation.

While businesses do pledge to follow the law and uphold ethical principles in their operations, CSR allows them to put their words into action. When this action is publicized on a greater scale, this reach can amplify the number of potential customers for the company.


Simply put, CSR may be used as part of a company’s marketing or social marketing strategy, in particular for activities involving raising funds and awareness for a particular cause.


However, companies should not design CSR specifically to suit the narrow dimensions of marketing and social marketing. Such actions while could allow more content to be shared out to a wide audience, may end up sounding artificial and insincere.

Focus instead on the value you truly want to and can bring to the environment and surrounding community. Make your intention transparent. Then and only then should marketing be brought into the picture. Future employees and potential customers abound when they note the genuine sincerity of your actions.

Conclusion


CSR is a good culture for a company to implement in their system. Through CSR, companies do gain benefits while also giving back to the community. It is definitely a win-win all around for companies to take their CSR initiatives seriously.


Which CSRs did you find memorable and have had a positive influence on your perception of the company?

By Kian Ng


What car does a financial planner drive? Wealth Vantage Advisory (WVA) is pleased to launch our “Have a Plan: How I Ride” series. Our financial planner for this edition is Kian Ng. This is the story of how he rides – both literally and financially.

Hey there, I am Kian and this is how I ride, financially and realistically.


Q1. What Car Do You Drive?


I drive a second-hand Honda Insight that I got from a friend in cash. This is my second car after my BMW 3 series. I found owning a luxury car is not my transportation of choice anymore as I have since realized that the maintenance and repair expenses could cost a bomb at any given time!

Kian’s second-hand Honda Insight, bought in cash.


Q2. What Influenced Your Car Choice?


My experience driving the more prestigious BMW was that it was a cool ride. It was the most expensive car I had owned.


However, other than this good feeling when driving it, I needed to spend more on hire purchase repayment as the loan amount was high. The quarterly maintenance cost was waived for the first 2 years at that time and eventually the rest of the cost was on my side! I remembered vividly the cost of changing a pair of tyres was a shocking RM 3500, excluding the workmanship charges.


With that in mind, I start to look for a car that is reliable, of a car brand is trusted, not necessarily must be brand new, and most importantly spare parts can be found easily. My timing was just right as this Honda Insight that checked all my boxes came from a dear friend who was getting a company car. We quickly got the transfer process done and the car was all mine.


I’ve already passed my 10th anniversary of driving this Honda Insight and I am still pleased with the car’s performance and enjoy driving it. Very importantly too is how pleased I am with this car from the perspective of cost savings.

Q3. How Do You Approach Your Personal Finances?


I plan my personal finances by adopting these 9 golden rules :


1. Know your current financial standing by talking to a Certified Financial Planner.


2. Ensure you stay focused on your personal financial goals.


3. Review your current financial standing.


4. Prepare sufficient emergency funding.


5. Protect against all possible risks.


6. Invest your assets smartly.


7. Constantly review your investment.


8. Plan your estate in case misfortune strikes.


9. Reward yourself occasionally.

Q4. How About Your Investing Approach?


I am a strong believer in investing. I constantly ensure that my monthly cash flow is at a surplus before I deploy any investment plans.


First is to pay myself sufficiently, in terms of personal and family expenses. With that in mind, I will have the surplus channeled to my savings and retirement needs. I always follow the rules to invest my surplus so that it can grow towards my financial life priorities. I invest regularly in using automation where possible. On top of that, I use a robo-advisor to help me to gain my targeted returns.


I always ensure that I have the right assets allocation amongst various investment schemes available to optimise my portfolio returns. Proper assets allocation reduces the volatility of my investment by 90%. I always check portfolios that at least have 3 years worth of track records. I understand the risks I am exposed to when I invest and also the potential returns.


My principle in investing is to ensure I can gain in whatever economic situation.

Q5. What is your financial tip for all Malaysians?


Get a financial plan from a Licensed Financial Planner that provide professional advice which is personal. It may be simple but it has to be aligned to your personal financial goals. The only thing required from your side is self-discipline. It is not easy but I am sure a simple plan will help you get a small step ahead of your personal finances.


Follow Kian Ng on Facebook


Do you have any stories on how you ride? Share with us in the comments section below.


“How I Plan” is a series focusing on personal stories by licensed financial planners and Malaysians.

By Idham Idris


This is a story of a client, Mr. A and his journey towards achieving total control of his financial situation and managing his cashflow.

Follow the story of my client, Mr. A, a single IT professional working in large financial institution in Kuala Lumpur. He wanted to grow his monthly savings rate and was looking to purchase a property for himself. He wanted to learn better ways to manage his monthly cashflow.


However, he had a mountain of debt to overcome first.

Client Stats

  • Age: Early 30s

  • Location: Kuala Lumpur

  • Marital status: Single

  • Debt Rate: RM5000 a month (credit card, personal loans, hire purchase)

  • Savings rate: None

  • Passive Income: None

  • Expenses: RM2500 a month (high insurance payments & not including loans)

  • Source of income: Salary

Debt Management Problem


Mr. A has high credit card and personal loans debt due to uncontrolled spending during his younger years. His monthly credit card and personal loans payments amount to almost 80% of his net income. His total credit card debt and personal loans debt is more than 15 times of his income.


This is what is known as a financial mistake that many other persons also experience. Choices we make when we are younger and less smart with our money tend to haunt us in later years.


On top of his high-interest debt issues, Mr A had bought several insurance plans that did not provide adequate coverage and required a large premium payment every month.

In short, Mr A was paying every month for mistakes made some time back, with nothing left to pay forward into any future plans.

Solutions & Planning


Before Mr. A can save more for his future goals, he needs to solve his debt repayment issue in order to create more cashflow. Moreover, by restructuring his insurance plans, he can lower his monthly insurance payments while getting the same or better level of coverage.


These is the plan we decided would best suit Mr A’s needs.


1. Risk management strategy:

  • Restructuring his insurance plans. To adjust his insurance plans to achieve the same or better coverage while reducing monthly payment sum.

2. Debt management strategy:

  • Managing credit card debt. Mr A’s credit card debt interests were at 18% per annum. This means that his annual rate of return has been negative due to the high interest rate incurred from this debt.

  • To use the 4-month bonus his company had awarded him to clear 25% of his credit card debt.

  • To use EPF iSinar withdrawal to clear some of his high-interest credit card debt. Credit card debt interest of 18% per annum versus EPF dividends of 5%-6% per annum, it was clear that this would be a wise move to take.

  • To convert remaining credit card debt to lower-interest term loans with longer repayment tenure to reduce monthly repayment amount.


  • Managing personal loans debt: To negotiate with banks to convert/consolidate personal loans to lower-interest loans. This would result in lower monthly repayments with lower interests.

Implementation and Result


1. Risk management:

  • Mr. A managed to reduce his monthly insurance payments by half.

  • He doubled his death and total permanent disability coverage, and have the same amount for critical illness cover which he didn’t have before.

  • For his medical insurance, he was able to get a better rate for hospital room and board, with a higher annual and lifetime limit.

2. Debt management:

  • Using iSinar and his 4-month company bonus, Mr A reduced his total credit card and personal loans debts by 40%. He reduced his monthly repayments by RM1k a month.

  • Successfully negotiated with the banks to convert his credit card debts to longer tenure term loans and with lower interest rates. He reduced his monthly debt repayment by 1k a month.

  • Total monthly debt repayment for credit card and personal loans reduced by 2k a month.

  • Total monthly cashflow improved by RM2.5k a month. Debt payment reduced from RM5k to 3k a month.

Where previously he had a negative cashflow of RM1k a month, now he was seeing a surplus of RM1.5k a month. Mr A was finally feeling relieved, more in control of his financial situation, and excited to finally move forward.


With a surplus, Mr A could now look at planning his future money goals, rather than being fixated on resolving his past debt.

A Continuous Journey


From the beginning of our journey together, Mr. A understood the severity of his situation. He would take prompt action to negotiate with the banks and was willing to make difficult decisions to reduce his lifestyle spending. Luckily for him, he was also able to take advantage of the iSinar assistance available in the current pandemic situation and solve his debt issues.


My role as a financial planner is to act as an advisor and guide. There are some issues that can be solved with better products (like getting a better, but cheaper insurance plan), but ultimately the rest of the actions is dependent on the client himself. I appreciate the trust Mr A put in my advice and I am happy for him that he took charge of his financial situation and is now in a much happier state.


While he continues to trust my professional advice, as his financial planner, I will continue to provide him with the best financial guidance I can give to see that Mr A continues to have a healthy financial life.


Q&A with Mr A


Q: How does it feel to have improved on your finances? A: I feel happy and relieved. So much less stressed over my financial situation.


Q: What was the key benefit you realised on the importance of financial planning? A: I realised the importance in having a clear action plan to solve my financial situation, and to execute the plan in a timely manner.


Q: What are your future plans for your life and financial journey? A: I am looking to start my retirement savings and finally able to save towards the purchase of my first property

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