/C.-
NINETEENTH CONGRESS OF THE 
REPUBLIC OF THE PHILIPPINES 
Second Regular Session
S. No.
)
SENATE
2355
of itH' 0
23 JUL25 P6:27
RECEIVED BY;
Introduced by SENATOR RAMON BONG RE VILLA, 3R.
AN ACT
ENCOURAGING CORPORATE SOCIAL RESPONSIBILITY, PROVIDING 
INCENTIVES THEREFOR
EXPLANATORY NOTE
It is no less than the Constitution that recognizes the indispensable role of the 
private sector in nation-building. In fact, as aptly provided therein1, the State 
encourages private enterprise and provides incentives to needed investments.
This is because the private sector can complement the effort of the government 
for the development of the nation by contributing to its economic, social, and 
environmental welfare.
This practice, known as Corporate Social Responsibility (CSR), Is defined by the 
World Bank as "the commitment of business to contribute to sustainable economic 
development, working with employees, their families, the local community, and society 
at large to improve quality of life, in ways that are both good for business and good 
for development."2
Therefore, this bill seeks to encourage the practice of CSR among all business 
organizations and engage into related activities such as charitable programs and 
projects, scientific research, youth and sports development, cultural or educational 
promotion, services to veterans and senior citizens, social welfare, environmental
1 Article 2, Section 20 of the Philippine 1987 Constitution
2 Accessed https;//web.worldbank.org/archive/website01006AA/EB/IMAGES/PUBLICPO.PDF
1


sustainability, health development, disaster relief and assistance, socialized and low- 
cost housing, and employee and worker welfare related activities.
Moreover, all business organizations are allowed to donate products and 
services under their CSR-related activities for disaster relief and assistance, in 
accordance with the regulations to be issued by the appropriate government agency.
To encourage stock corporations to engage in CSR, this bill also aims to allow 
them to retain surplus profit in excess of one hundred percent (100%) of their paid- 
in capital stock if they execute board-approved CSR programs.
Therefore, in view of the foregoing, the passage of this measure is earnestly
sought.
RAMO^BONG REVILLA, 3R.


NINETEENTH CONGRESS OF THE 
REPUBLIC OF THE PHILIPPINES 
Second Regular Session
)
SENATE
s. No. 2355
. 'I Senate
of \:5?
23 JUL25 P6:27
Introduced by SENATOR RAMON BONG RE VILLA, JR.
AN ACT
ENCOURAGING CORPORATE SOCIAL RESPONSIBILITY, PROVIDING 
INCENTIVES THEREFOR
Be it enacted by the Senate and House of Representatives of the Philippines in 
Congress assembled:
1 
Section 1. Short Title. - This Act shall be known as the Corporate Social
2 
Responsibility Act'.
3 
Sec. 2. Declaration of Policy. - The State recognizes the vital role of the private
4 
sector in nation-building and shall encourage its active participation in fostering
5 
sustainable economic development and environment protection in the Philippines.
6 
Towards this end, the government shall mobilize its various agencies, in coordination
7 
with non-government and people's organizations, to work hand-in-hand for the
8 
integration, promotion, and strengthening of corporate social responsibility in all
9 
business organizations.
10 
Sec. 3. Corporate Social Responsibility. - All business organizations established
11 
and operating under Philippine laws, whether domestic or foreign, are hereby
12 
encouraged to observe corporate social responsibility in the operation of their
13 
businesses in the country.
14 
As used in this Act, corporate social responsibility (CSR) refers to the
15 
commitment of business to contribute on a voluntary basis to sustainable economic
16 
development by working with relevant stakeholders to Improve their lives in ways that


1 
are good for business, sustainable development agenda and society at large. CSR-
2 
related activities shall include the following:
3 
(a) Charitable programs and projects;
4 
(b) Scientific research;
5 
(c) Youth and sports development;
6 
(d) Cultural or educational promotion;
7 
(e) Services to veterans and senior citizens;
8 
(f) Social welfare;
9 
(g) Environmental sustainability;
10 
(h) Health development;
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(i) Disaster relief and assistance;
12 
0) Socialized and low-cost housing; and
13 
(k) Employee and worker welfare related CSR activities.
14 
All business organizations are allowed to donate products and services under
15 
their CSR-related activities for disaster relief and assistance, in accordance with the
16 
regulations to be issued by the appropriate government agency. All existing laws and
17 
regulations restricting or prohibiting the right of local government units under a state
18 
of calamity and/or during a national emergency to solicit or accept any donation of
19 
products and services under the CSR-related activities for disaster relief and assistance
20 
of a business organization are hereby amended.
21 
Sec. 4. Deduction from Unrestricted Retained Earnings. - To encourage
22 
companies to engage in CSR, Section 42 of Republic Act No. 11232, otherwise known
23 
as the "Revised Corporation Code of the Philippines" Is hereby amended to read as
24 
follows:
25 
"SEC. 42. Power to Declare Dividends. -
26 
XXX
27 
"Stock corporations are prohibited from retaining surplus
28 
profit In excess of one hundred percent (100%) of their
29 
paid-in capital stock, except: (a) when justified by definite
30 
corporate expansion OR FOR CORPORATE SOCIAL
31 
RESPONSIBILITY (CSR) projects or programs approved
32 
by the board of directors; or (b) when the corporation is


1 
prohibited under any loan agreement with financial
2 
Institutions or creditors, whether local or foreign, from
3 
declaring dividends without their consent, and such
4 
consent has not yet been secured; or (c) when it can be
5 
clearly shown that such retention is necessary under
6 
special circumstances obtaining in the corporation, such as
7 
when there is a need for special reserve for probable
8 
contingencies."
9 
Sec. 5. Awards and Recognition. - The Department of Trade and Industry (DTI)
10 
shall recognize and reward all business organizations for outstanding, innovative, and
11 
world-class CSR-related services, projects, and programs. It shall likewise extend
12 
endorsement and encouragements to domestic and foreign corporations doing
13 
business in the Philippines which are candidates for recognition in international award-
14 
giving bodies for their CSR-related activities.
15 
Sec. 6. Locai Government Units. - All local government units where CSR-related
16 
activities are conducted shall extend whatever assistance is necessary for business
17 
organizations to accomplish their CSR programs and projects.
18 
Sec. 7. Periodic Report. - All business organizations shall submit the list of their
19 
CSR activities as part of their annual or regular report to the Securities and Exchange
20 
Commission (SEC), DTI, or the Department of Finance, as the case may be.
21 
Sec. 8. Impiementing Ruies andReguiations. - Within sixty (60) days after the
22 
effectivity of this Act, the Secretary of Finance shall, in coordination with DTI and the
23 
SEC, promulgate rules and regulations for the effective implementation of this Act.
24 
Sec. 9. Separabiiity Ciause. - If any provision of this Act is declared invalid or
25 
unconstitutional, the remaining provisions not affected thereby shall continue in full
26 
force and effect.
27 
Sec. 10. Repeaiing Ciause. - Section 42 of Republic Act No. 11232 is hereby
28 
amended. All laws, decrees, orders, rules and regulations, and other issuances, or
29 
parts thereof inconsistent with or contrary to this Act are hereby repealed or modified
30 
accordingly.


1 
Sec. 11. Effectivity. - This Act shall take effect fifteen (15) days after its
2 
publication in the Officid! Gdzette or in a newspaper of general circulation in the
3 
Philippines.
Approved,