Soviet citizens were not allowed to be enterprising and any mark-up on goods constituted as illegal. It is thus only after the fall of the Soviet Union, the opening of the “Iron Curtain” and the introduction of capitalism that private businesses began to flourish in the CIS. Nearly all large-scale post- Soviet businesses were set up during the “Wild 90s” when the old values were gone and forgotten and new ones had not yet had a chance to develop. Then people worked only for their own personal gains putting profit above everything else!

The expression “Profit above everything but honesty above profit” was the leitmotif of the newspaper “Birzhevyе Vedomosti” circulated at the beginning of the 20th Century. The spirit of the core principles such as honesty, decency and patronage which had been inherent in the Russian merchant class is in fact still relevant today. The businessmen of the past were often involved in such noble and prestigious acts as social work, spiritual and intellectual development and protecting their motherland. The famous writer of political essays and critic, V. V. Stasov wrote that “Despite their wealth Russian merchants were not at all interested in simply wiling their time away but were possessed with a firm commitment to working for the common good and the benefit of their nation.”

In 1910 in the Russian Empire, which also included Turkestan from where the Central Asian Republics would rise during the Soviet Union, there were 6,278 charitable organizations, 75% of which were financed by private donations. In Moscow alone there were 628 charitable institutions: hospitals, schools and almshouses. It was none other than the Russian merchants who collected the treasures which we now call our national property such as the Tretiyakov Gallery and the Morozov and Shukin collections of Western European art. Thanks to the Russian merchants the Bahrushinskii Theater Museum, Moscow Arts Theater, most of the Morozov medical institutions, the Soldatenkov (Botkin) Hospital, the Alekseev Eye Hospital, the Abrikos Natal Clinic, the Shelaputin medical and educational institutions, the Vishnyakov Institute (previously the Russian G.V. Plehanov Academy of Economics) and hundreds of other public institutions have been enriching our society for centuries. Many factory owners and banker s would become patrons of these institutions. For example, in Kyrgyzstan, most specifically in Karakol Russian and Tatar merchants were traditionally engaged in patronage, publishing books and founding the first theater companies.

Today these principles are upheld by most international corporations through what we call Corporate Social Responsibility (CSR). Issues touched on by CSR include environmental concerns, support of vulnerable people in society and the use of eco-friendly materials in production.

Presently nearly all social projects in Kyrgyzstan are financed by various international donors: the European Commission, the US Agency for International Development (USAID), OSCE and many different embassies. Both human rights activists and NGO workers themselves now refer to Kyrgyzstan in jest as the “Country of NGOs”. However, thanks to the ease with which international donors gave money to various social projects it was not difficult to set up so many nongovernmental organizations in our country. For many NGOs this has become a sort of business, although this is not to say that all donors are concerned with the effectiveness of projects.

When international donors give money they generally decide on the focus of the project, the target group and what it is they want to achieve and sometimes this does not correspond at all with the needs of our society. In many cases the aims and objectives of the project are devised by the donors themselves and not by the people who are meant to benefit from it.

Of course it is very commendable that the majority of our successful companies give sponsorship to various institutions in need of support such as orphanages, hospitals and retirements homes. However, on top of just giving money it is also very important to understand that there is also a need for more long-term reforms and projects which could also help to develop the business itself.

A strong, stable society is the foundation for the prosperity of every business. The principle rule of development goes as follows: the richer the social base, the more room for development the business has. One of the main principles of corporate social responsibility is that both large and small projects should be aimed at making long-term reforms rather than temporarily easing the impact of certain problems. It is better to teach people to use a fishing rod rather than just feeding them the fish.

Of course, on top of corporate social responsibility it is important not to overlook the government’s role in the development process. A socially-responsible business should receive support from the government in the form of certain benefits. The successful development of our society is thus dependent on three groups: the government, businesses and society itself.

Unfortunately the situation in our country today still leaves a lot of room for improvement: our legal norms don’t include sponsorship and charity. A business giving social support to a project has to do this surreptitiously, altering its accounts secretively in order to avoid incurring additional taxes. Although, of course, it is also important to understand that the government is not in the position to solve all social problems, especially on a local level. It simply cannot reach every village. Only corporations and the community itself have the necessary resources for this.

Today in Kyrgyzstan 100,000 children have no family or education. However, the local council is not in the position to track their whereabouts or to give aid. The social consequences of this are plain to see. Businesses and local communities participating in solving social problems would take some of the load off the government and would help with the development of social institutions.

We can therefore conclude that it is in the interests of the government, businesses and communities to develop a normative-legal base which will encourage sponsorship and charity as well as to cultivate corporate social responsibility.

After all, we are all responsible for the living conditions of the population in the country where we live.

Shamil Ibraghimov
Executive Director of EFCA Kyrgyzstan