The Importance of Corporate Social Responsibility

The Importance of Corporate Social Responsibility

The Importance of Corporate Social Responsibility 1200 800 Gary Wong
Reading Time: 3 minutes

Marco Raccuia introduces the commitment that Hugill & Ip has taken towards social responsibility and its positive impact for any organization, both internally and externally.

Gary Wong explains about the best legal structure for a charitable organization set up, including the upside of special tax rules.

Show Notes
00:26 Combining social and business reasons
00:57 Growing impact of CSR in Hong Kong
01:59 CSR activities at Hugill & Ip
02:39 How to set up a charity?
03:21 Charitable company with limited liability
04:09 Tax advantages


TRANSCRIPT

Marco Raccuia  00:08
At Hugill & Ip we strongly believe in corporate social responsibility. This way we can develop a better working environment for our staff, and nurture social inclusion into them, as well as strive to provide better services for our clients.

We reckon that social responsibility is a necessary ethical stand in which individuals are accountable for fulfilling their civic duty. CSR not only can be impacting the society we live in and create a healthier community, it can also be part of a business strategy for success. We can be empowered and create the right balance between economic growth and the wellbeing of the society and the environment.

Marco Raccuia  00:57
CSR is seen as a strategic direction for societies with Hong Kong gradually recognizing its importance. There’s an undeniable growing impact of CSR in the business sector, particularly big industrial and service-oriented corporations, as these look for viable business sustainability models. Overall, societies have become more ethically aware, and consumers are more attracted to businesses that have a strong commitment to CSR. In fact, while doing business and guaranteeing shareholder profits, businesses need to consider the bigger necessity of social wellbeing and environmental protection.

Social Responsibility is also a major driver in motivating, retaining and attracting talent to a company. I would say it is truly a long-term positive investment in the business on top of, of course, leaving a deeper mark into the society we live in.

Marco Raccuia  01:59
Aside from our continuous pro bono legal work, in the past three years, Hugill & Ip has been involved in different social responsibility activities supporting different charity organizations about causes we feel very passionate about: from food banking and waste reduction to the BRACE Awards, from fighting the spread and the stigma related to HIV and AIDS to raising funds for cancer research  and to encourage its prevention, detection and treatment.

We’re very excited to continue supporting different causes, and will soon be announcing a new campaign we are involved in.

Gary Wong  02:39
Aside from Hugill & Ip being very involved in charitable work, we do help a number of our clients to fulfill their charitable aims, both individuals and businesses. In Hong Kong, you could set up a charity two different structures, but the most common is a company limited by guarantee as a straightforward, structured and can achieve financial transparency, we see more and more people moving away from having an unincorporated body association or Trust to run a charity because the people running the charity are regarded as trustees or owners and have personal liability for any debts incurred in the course of the charity’s business.

Gary Wong  03:21
Unlike the unincorporated body, association or Trust, a charitable company with limited guarantee incorporated in Hong Kong can own property under its own name, be accountable for its own debt, and can enter into transactions with a third party without the need for the trustees to do so on its behalf. As a company limited by guarantee the charity will have directors and members who are fully protected by the legal nature of the company, except in the cases of fraud or gross neglect. Also, companies limited by guarantee must submit returns as well as audited accounts annually and comply with the provisions of the Companies Ordinance (Cap. 622), which among other things, regulate duties and responsibilities of every director.

Gary Wong  04:09
Another consideration is whether you would like to apply for your charity to be exempt from tax under the Inland Revenue Ordinance (Cap. 112). To be qualified for the tax exemption, your charity must be established exclusively for charitable purposes, with objects that fulfill the requirements imposed by the Inland Revenue Department. With the tax exemption, this means that each donation to your charity is exempt from tax and your donor can claim a tax deduction. If the charity needs support from the public, having your charity with a tax exemption is clearly more attractive.

 

This video is for informational purposes only. Its contents do not constitute legal or professional advice.

Gary Wong

Gary Wong

Gary is a corporate lawyer advising companies, funds and individuals on M&A transactions, investments, licensing, commercial and regulatory matters.

All articles by : Gary Wong
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