Proposal

CAGAYAN STATE UNIVERSITY- ANDREWS CAMPUS PAGE 1
Chapter 1
INTRODUCTION
1.1. Background of the Study
The various societal problems that we face today are products of our own acts.
Poverty, illiteracy, crime and environmental problems are just some of them. Though
many problems occur, it is not yet too late for us to resolve it. We may not be able to
totally eradicate these things, but at least we can do something to ease the burdens we
are carrying.
One of the laws which congress had passed, to help maintain the inclusiveness
and participation of the society to lessen our difficulties is Republic Act No. 9418
otherwise known as the “Volunteer Act of 2007”. This specific statute promotes the
participation of the various sectors of the Filipino society, and as necessary, international
and foreign volunteer organizations in public and civic affairs, and adopt and strengthen
the practice of volunteerism as a strategy in order to attain national development and
international understanding. This law is also binding to every business organization in
consonance with their respective “Corporate Social Responsibility” (CSR).
CSR, according to various authors, refers to the voluntary activities integrated in
the corporate policy of an organization that expresses the relationship between the
organization and its stakeholders. It is a voluntary act that the organization perform
without compelling them to do such activity. It is more of a discretionary deed on the
part of the business rather than obligatory. The concept of CSR, according to many
authors who conducted literature reviews, is under-researched and many areas of this
topic is still needed to be studied and identified.

According to a study conducted by Chen, Chen & Torstensson, Paul (2015) it
showed that the “environmental management system” of the company which they
studied has led to some upgrades of production equipment which has contributed to
increasing energy efficiency. Regarding the social aspects, it is found that the company’s
“environmental management system” acts as a means for social responsibility by
increasing the employees training and education in health and safety issues which helps
developing staff and minimizing risks. The company itself became self-sustainable and
was more efficient with the advent of their social responsibility.
A study conducted by Maximiano, Jose Mario (2005), here in the Philippines,
suggested that most of the respondent business companies have a low corporate-
community partnership in their social responsibility. It also stressed out that majority of
the companies are not at all involved in the practice of waste management and
assuming responsibility for any environmental impact the operations leave on the
environment. Among the various areas of corporate social responsibility, workplace
concerns is most addressed. These involve activities such as compensating employees
above the minimum wage, providing the best working conditions and providing training
and development opportunities to employees. The companies’ integration of the CSR to
their corporate policy is only at a moderate extent. There are also some companies who
have corporate policies but they did not incorporate it to their program development.
Additionally, monitoring and reporting of the CSR practices was not prioritized and given
much importance.
The distributors of renewable energy in the city of Tuguegarao, especially the
local electric cooperative and the metropolitan water district, acquires and obtains its
energy from the environment itself. It is but proper for these public service organizations
to give back to the environment and to the community. These companies are growing
large due to the increasing amount of population that they provide accommodations for
in the city. Tuguegarao being a “melting pot”, especially for profit oriented organizations
and for students who seek quality education, has incredibly very high consumption on
water and electric resources during the past decades. The two towering business
organizations namely the CAGELCO 1 (Cagayan 1 Electric Cooperative, Inc.) and the
MTWD (Metropolitan Tuguegarao Water District) are the ones responsible for
distributing and catering to the needs of the public in terms of electric and water
resources respectively. Thus, they are also expected to be socially responsible to their
community.
The authors were motivated by the fact that they are stakeholders of these
public utilities. As such, the researchers expect something from these businesses
especially that the law provides for the encouragement of the implementation of CSR
programs by corporate sectors in the community.
Hence, this paper will study whether or not the two aforesaid business
organizations have been effectively and efficiently planning and implementing CSR
activities and programs as part of their company policy in consistency with the present
laws and to the needs and demands of the community and the environment and all
other stakeholders that these companies have in particular.

1.2. Statement of the Problem
Generally, this study aims to present the Corporate Social Responsibility
programs implemented by CAGELCO 1 and MTWD.
Specifically, this study seeks to answer the following questions:
1. What are the Corporate Social Responsibility programs implemented by CAGELCO 1
and MTWD in terms of:

1.1. social investment
1.2. corporate community partnership
1.3. environmental stewardship
1.4. managing workplace concerns
2. What motivate or inspire CAGELCO 1 and MTWD in implementing their Corporate
Social Responsibility programs and activities?

3. What are the barriers and obstacles that prevent or impede the implementation of
Corporate Social Responsibility programs by CAGELCO 1 and MTWD?

4. Do the Corporate Social Responsibility programs of CAGELCO 1 and MTWD affect its
operation in terms of:

4.1. profitability
4.2. sustainable development
4.3. image and reputation
4.4. environmental improvement and advancement
4.5. conflict resolution and management
4.6. legal compliance
5. Do the Corporate Social Responsibility programs of CAGELCO 1 and MTWD affect its
stakeholders in terms of:

5.1. customer satisfaction
5.2. employee motivation and retention
5.3. community advancement
1.3. Assumption
This paper will assume that the integration of CSR programs as part of the
organizational policy of CAGELCO 1 and MTWD does not affect their business operation
and stakeholders.
1.4. Conceptual Framework
Based on existing concepts presented and disputed by various and numerous
researchers, business experts and other authors, the researchers have come up with a
framework that will serve as a guide for them to conduct this study. The framework will
be considered as the paradigm or model to be followed particularly in determining the
relationship between variables that can be of great implication in this investigation. This
framework gives an outline on the flow of connection between the cause and effect
relationship that exist between CSR programs and the operation of the business and its
stakeholders in particular.
CSR Programs  Compliance to  Identify possible

RA 9418. effects of CSR to the
 social operation of the
investment businesses.
 corporate  Integration of
community CSR programs in
partnership the company policy.  Identify possible
 environmental effects of CSR to the
stewardship operation of the
 Actual
 managing businesses.
implementation of
workplace CSR activities.
concerns  Identify various
barriers that prevent the
FIGURE 1. Paradigm of the Study

The figure above shows the input, process and output involved in the study. The
inputs of the study is represented by the four areas of CSR programs as identified in the
study of Maximiano, Jose Mario. These four areas are social investment, corporate
community partnership, environmental stewardship and managing workplace concerns.
These CSR programs are identified as factors that may (or may not) affect the outputs
involved and entangled in this investigation.
The process includes compliance of the businesses to RA 9418 (otherwise known
as Volunteer Act of 2007), the integration of CSR programs in the company policy and
finally, the actual implementation of CSR activities.
The output is divided into three. The first is composed of the aspects related to
the operations of the businesses. This include profitability, sustainable development,
image and reputation, environmental improvement and advancement, conflict
resolution and management and legal compliance. These areas are the activities
referring to the management and administration of the organization. On the other hand,
the second is composed of customer satisfaction, employee motivation and retention
and the community advancement. This set denotes the result of CSR to the betterment
of the stakeholders of the company. The last output is the identification of barriers and
obstacles that prevent or impede the actual implementation of CSR programs.
There were some scopes of operation and also some organizational stakeholders
that were not included because these variables are not applicable based on the nature
of the business organizations being studied. These variables are studied to assist the
organization on how to come up with various resolution on how the management may
effectively and efficiently integrate these CSR activities into their organization’s vision
and mission.
1.5. Significance of the Study
This study is conducted for the benefit of various individuals, group of individuals
and organizations. The following are the stakeholders of this study:
The Cagayan 1 Electric Cooperative, Inc. and Metropolitan Tuguegarao Water
District, particularly its management and employees, may use this study as a basis for
them to formulate their organizational policy principally through integrating their CSR
programs into their day-to-day operations. This study may also be a guide for them on
how to resolve issues in the organization, to identify how CSR affect various aspects of
their operation and to determine what different barriers may hinder the implementation
of their CSR programs.
The Government, particularly through the Energy Regulatory Commission and
Local Water Utilities Administration, and other agencies of the government duly
authorized to regulate these businesses, may use this study as a basis for the formation
of memorandum circulars and other protocols on how to regulate public utilities
particularly on the matter of encouraging them to perform CSR activities for the general
welfare of the public in consistency with their respective mandates and in coordination
with other governmental agencies.
The Consumers, particularly the residents of the area of coverage where these
public utilities operate, may use this study to understand some ideas and concepts of
CSR. But above everything else, this study may give them consciousness on the various
activities that CAGELCO 1 and MTWD are carrying out which they may also share to the
other members of the community to spread awareness to everyone.
The Community, particularly the members of the community where these public
utilities operate, may use this study as a basis for them to familiarize themselves with
the existing CSR programs of CAGELCO 1 and MTWD which may be beneficial for the
advancement, improvement and as a means of assistance to the indigent members of
the community and the community as a whole.
The Future Companies and Businesses, specifically its owners and managers, may
find this beneficial particularly to appreciate the importance of performing CSR activities
both for the benefit of the society and for the business. This study may also guide
entrepreneurs who have plans entering into ventures to choose appropriate activities
among various CSR programs being presented.
The Future Researchers, particularly Filipino students, may find this thesis a good
basis for further investigation of CSR in the Philippine context. This study may also serve
as a basis for the students to study other variables and aspects of CSR which is still
considered under-researched and needs more study and exploration. This may also add
to their review of related literature and studies.
Above all, the Researchers find this thesis informational and an addition to their
knowledge and familiarity with a particular topic and issue. The researchers also
consider this as their simple creation and as a humble contribution to the college and
the university.
1.6. Scope and Limitation of the Study
This study, like any other research has its own demarcation and delineations. This
study is aimed only in knowing the various CSR programs implemented by Cagayan 1
Electric Cooperative, Inc. and the Metropolitan Tuguegarao Water District, and how it
relates to the operation and stakeholders of the organization. This study includes certain
residents of Tuguegarao as informants of the study on the matter of their personal
perceptions on the effects of CSR programs to their satisfaction as consumers and to the
development of the community in general. Furthermore, this study is only limited to a
few employees and personnel of CAGELCO 1 and MTWD as informants, on the subject of
their individual insights regarding the effects of CSR to their motivation and retention in
the organization. As regards to the CSR programs, the persons to be interviewed will be
coming from the middle and top management as based on the organizational structure
of the company.
Like other studies, this creation has also some lapses and limitations. One of
which is the effect of CSR to the productivity of the business. The subjects are not
manufacturing companies and by nature, they obtain their resources from the
environment and not from the direct injection and participation of human labor as a
major input for producing water and electricity. Therefore, this study cannot determine
the effect of CSR with that of productivity based on labor inputs. Moreover, based on the
nature of the business, this study cannot determine also the effect of the integration of
CSR into the company policy with the state of being more advantageous compared to
the company’s market competitors. As public utilities, these companies are monopolistic
in nature and therefore, they predominate the distribution of water and electric supply
in their own jurisdiction as defined by them. Additionally, with the nature of the
business, competitors cannot be included in the list of stakeholders that may be
affected. In addition, with the huge population of the informants of the study, the
purposive sampling will be used by the researchers and therefore limit the number of
informants to a certain point.
The foregoing limitations and delimitations of the study may directly or indirectly
affect the output or outcome of the study which can make the conclusion of this study
different and inconsistent with other studies previously conducted by other researchers.
1.7. Definition of Terms
To be able to comprehend and understand this study easily, the following terms
and words are defined operationally or defined in the context of this study. The
following terms are:
Business Operation- refers to the day-to-day conduct of business, activities or functions
performed by the employees and personnel of the organization including the
acts made by the management.
Community Advancement- refers to the effects and influences produced by the CSR
programs of businesses in connection to the progress, development,

improvement and growth of certain individuals, group of individuals, or
associations of the place where the business operates.
Conflict Resolution and Management- refers to the effects and influences produced by
the CSR programs of businesses in connection to the activities, undertakings
and other measures that may resolve existing and ongoing problems,
difficulties and complications within the organization or may also be outside
the organization but which either directly or indirectly affect the conduct of
business.
Corporate Community Partnership- refers to the area of CSR programs including but not
limited to the financial contributions to the community, hiring people from
the community and other acts which relate to the engagement of the
community with the operation of the business.
Corporate Social Responsibility- refers to the ethical, political, instrumental or integrative
obligation, duty and commitment that the organization willingly and
voluntarily makes in order to promote goodwill to its stakeholders and to the
organization itself.
Corporate Social Responsibility Programs- refers to the activities and other functions that
the organization include and integrate into their company policy that are
voluntary in nature and which originated from the concepts of social
responsibility.
Customer Satisfaction- refers to the effects and influences produced by the CSR
programs of businesses in connection to the contentment that the
consumers of the business feel and receive from the organization.
Electric Utilities- refers to corporations, cooperatives and other forms of business
organizations that serve the public by distributing electrical energy resources
within a particular area of region for household, commercial and industrial
purposes.
Employee Motivation and Retention- refers to the effects and influences produced by the
CSR programs of businesses in connection to the state of the personnel being
inspired and encouraged to be more industrious and to stay and remain in
the business as an advantage to the organization.
Environmental Improvement and Advancement- refers to the effects and influences
produced by the CSR programs of businesses in connection to the
conservation, protection, maintenance, balance, development, improvement
and growth of the ecology and the ecosystem where the business operate.
Environmental Stewardship- refers to the area of CSR programs including but not limited
to the proper waste management, encouragement of water and energy
conservation, making purchases from responsible partners in the
community, assumption of responsibility to environmental impacts of the
operation and other acts which are beneficial to the environment.
Image and Reputation- refers to the effects and influences produced by the CSR
programs of businesses in connection to the character, charisma,

attractiveness and appeal of the organization to the public which may either
be in a negative or positive way.
Managing Workplace Concerns- refers to the area of CSR programs including but not
limited to compensation and benefits management, providing best
conditions for working places and training and/or development and other
opportunities given by the organization to its personnel.
Legal Compliance- refers to the effects and influences produced by the CSR programs of
businesses in connection to obedience and submissiveness of the
organization to the laws, rules, regulations and other statutes concerning the
lawful conduct of the business.
Profitability- refers to the effects and influences produced by the CSR programs of
businesses in connection to the cost-effectiveness and earnings or returns
that the organization reaps and realizes which are in the form of cash or non-
cash revenue but which may have monetary equivalence or value.
Public Utilities- refers to corporations, cooperatives and other forms of business
organizations that serve the public including but not limited to
transportation services, water resource distribution and electric generation
and distribution.
Social Investment- refers to the area of CSR programs including but not limited to
supporting of programs to address social issues, locating facilities or jobs in
economically depressed communities and other activities with the inclusion
of the community to resolve specific social issues.

Stakeholders- refers to individual, group of individuals, organizations or associations that
partake or participate and affect the organization directly or indirectly
including consumers/customers, employees/personnel and the community
as a whole.
Sustainable Development refers to the effects and influences produced by the CSR
programs of businesses in connection to the development of the
organization through realization of profits but at the same time push for the
development of the community without destroying the environment or the
ecosystem.
Water Utilities- refers to corporations, cooperatives and other forms of business
organizations that serve the public by distributing water resources within a
particular area of region for household, commercial and industrial purposes.
Chapter 2
REVIEW OF RELATED LITERATURE AND STUDIES
The advent of technology paved way to the emergence of various ways to make
the life of people easier and more efficient. The physiological needs were given more
and more importance and some wants even turned into needs. One of the needs that
people consider today are water and electric supply. Water is a basic need for survival
and for us to function, but electricity became a need when people learned to maximize
“night time” as possible and potential part of working hours. Electricity also became the
foundation of large manufacturing companies. This chapter will present various
literature and studies in connection to water and electric supply, its suppliers and
distributors, the role of the government and the corporate social responsibility of
business organizations. A thorough examination, explanation and presentation of ideas
both from foreign and local literature and studies were made especially to understand
more about the concept and theories in relation to the topic at hand. Some other
concepts that are also important were being discussed like the theory bases of CSR or
the number of countries with the worst and least water and electric supply.
2.1. Related Literature
The literature review is composed mainly of articles, news, journals, opinions,
surveys that are not in the form of thesis and even published and unpublished books.
The literature review consists of two areas. One for foreign literature and another for
local literature. Both areas are divided into sub-topics arranged according to ideas or
concepts. It will cover the topics in connection to water and electric supply and CSR of
enterprises. The topics are presented according to their relevance and connection with
the thesis title.
2.1.1. Foreign Literature
2.1.1.1. Water and Electricity Resource Scarcity Reports
According to a report from the United Nations Department of Economic and
Social Affairs (2014)1 around seven hundred (700) million people in forty three (43)
countries suffer today from water scarcity. The same report also provides that the most
affected area is the Sub-Saharan Africa which has the largest number of water-stressed
1
United Nations Department of Economic and Social Affairs (2014). International Decade for Action
“WATER FOR LIFE” 2005-2015. United Nations Website: UN Water.
countries of any region. Experts expect that by 2025 water scarcity would be malignant
where 1.8 billion people will be living in countries or regions with absolute water
scarcity, and two-thirds (2/3) of the world's population might be living under water
stressed conditions. Alarming as it may sound, if we don’t act in due time, the effect will
be more devastating and risky.
Scarcity is not the only challenge here, there is also “limitation”. Though some
places have enough water supply, there is an unequal distribution of the water resource.
It was reported by the World Health Organization (2017) 2 that only around 1.3 billion
people have basic services, meaning they have an improved water source but is located
within a round trip of 30 minutes. Also, 263 million people have very limited services, or
an improved water source which requires someone to spend more than 30 minutes to
collect water. This is an unequal distribution due to lack of facilities which can easily
distribute water through pipes and tubes that lead to residential areas and households.
According to a ranking made by the U.S. Report and World News (2018) 3 the top
ten countries with the least safely managed supply based from data available in 2015
(from 10th place to the 1st place) are Mexico, Congo, Pakistan, Bhutan, Ghana, Nepal,
Cambodia, Nigeria, Ethiopia and Uganda. These countries have the worst water supply
that directly affects its citizens and who suffer from sickness due to unsafe water and
scarce water supply.
2
World Health Organization (2017). Drinking-Water: Fact Sheet. World Health Organization Media
Centre.
3
U.S. Report and World News (2018). 10 Countries With the Worst Drinking Water: A new report assesses
the accessibility, availability and quality of drinking water across the world. U.S. Report Journal.
According to an article written by Lindeman, Todd (2015) 4, there are at least 1.3
billion people around the globe who lack access to electricity. 600 million people do not
have electric supply in the Sub-Saharan region in Africa alone and 304 million in India do
not have electricity too. Converted to ratio, in Asia alone, nearly 2 out of 10 people don’t
have access to electricity. In the Sub-Saharan region, that’s a ratio of 7 out of 10.
Incredibly speaking, that’s a lot of people who are not given the chance to have a bright
night.
As additional data, Badger, Emily (2013) 5 cited a report from the World Bank that
between 1990 up to 2000 an approximate 1.6 billion people gained access to electricity
and 70 percent of them are from urban areas. This is a big feat for the world but sad to
say, as of 2010 an overwhelming 1.2 billion among the world’s population still lack or
absolutely without access to electricity. The reason according to her is because of the
rapid increase of population. Though there is a big addition in the number of people
who can access electricity, the population increases with it. For the past 3 decades, the
number of people who have electric supply became almost stagnant.
As of last year, Wee, Rolando (2017) 6 listed the top ten countries and places
which have the lowest population who have access to electricity. In his list (from top 10
to top 1) these ten countries are Tanzania, Niger, Sierra Leone, Burkina Faso, Central
African Republic, Liberia, Malawi, Burundi, Chad and South Sudan. Overwhelmingly,
4
Lindeman, Todd (2015). 1.3 Billion Are Living in the Dark. The Washington Post.
5
Badger, Emily (2013). Where a Billion People Still Live Without Electricity. CityLab Journals.
6
Wee, Rolando (2017). Countries with the Lowest Access to Electricity. Worldatlas: World Facts.
South Sudan being on the first place have 94.9 percent among the populace who don’t
have electricity access.
These reports are beneficial to this study to know the present state of the
countries without effective organizations that distribute and supply water and electricity.
With these reports, this paper establishes the fact that water and electric distributors
are very important to the survival of humanity.
2.1.1.2. Concept of Corporate Social Responsibility
As defined by Crowther, David & Aras, Guler (2008) 7, corporate social
responsibility means what is or should be the relationship between global corporations,
government of countries and individual citizens. Specifically, it may also be defined as
the relationship between a corporation and the local society in which it resides or
operates or the relationship between the business organization and its stakeholders.
Generally speaking, corporate social responsibility is not only binding to business
organizations which are in the form and nature of a corporation. It also applies to
partnerships, cooperatives and even sole proprietorship. Therefore, this statement
dictates and directs that CSR is applicable to CAGELCO 1 and MTWD.
According to Garriga, Elisabet & Mele, Dome`nec (2004) 8, the concept of
Corporate Social Responsibility is based on various theories. There are four theories
namely the instrumental theory, political theory, integrative theory and ethical theory. In
7
Crowther, David & Aras, Guler (2008). Corporate Social Responsibility. Ventus Publishing ApS/ Book
Boon.
8
Garriga, Elisabet & Mele, Dome`nec (2004). Corporate Social Responsibility; Theories: Mapping the
Territory. Journal of Business Ethics, Kluwer Academic Publishers, Netherlands.
instrumental theory, businesses accept social responsibility if and only if such activity is
in connection with wealth creation. Political theory on the other hand presupposes that
businesses operate under the supervision of a political arena and hence they should use
their business power in a responsible way. The third basis, integrative theory, is founded
on the idea that businesses are dependent to the society where they operate for them
to continuously earn profits and thus they give back to the community through
integration of societal demands into their businesses. Lastly, ethical theory is grounded
on the consideration that among all other things, our society operates and moves in
accordance with ethical standards and therefore businesses consider ethical obligation
as their utmost vision and goal.
These theories may differ and vary in their explanatory concepts, nonetheless,
one or more than one of them is a ground for a company to conduct activities that are
beneficial to the general public particularly to people who are part of their stakeholders.
These theories become the motivating point of the subjects which this paper tries to
identify.
But is there really a need for us to study the CSR of business entities? According
to NaLi, Qi Su & Schwalbach (2008) 9 cited by Magpantay, Hana Lea, there are three main
reasons why CSR of various businesses should be studied. First reason is caused by
globalization. Because of this, there is a need to intensify and extend the interrelation
between a developed and a developing country by outsourcing the former’s supply
9
NaLi, Qi Su & Schwalbach (2008). Do Institutions Matter for CSR to SMEs? Comparing CSR of SMEs
between Developed and Developing Countries from an Institutional Perspective. Institute of Electrical and
Electronics Engineer Journal.
chain. Secondly, CSR as a theory and concept is not carried much in actual activities and
through studying these concepts, it will enlighten businesses on some portions of both
theory and practice in implementing CSR. Lastly, it can be used as a guide by newly
emerging businesses in which such concepts would come from rapidly developing
economies of businesses.
The authors have laid down the various reasons for us to study CSR. This
becomes the starting point why the researchers conducts this study. This also becomes
the motivation why this study should be conducted. With the ASEAN (Association of
Southeast Asian Nations) integration, globalization becomes one of the issues that
businesses face today.
In a literature review made by Su, Rong-Jia & Jie, Xiao-Wen (2015) 10, they
concluded that more empirical tests are needed to investigate determinants of CSR and
resources utilized in the provision of CSR. Furthermore, the selection of dimensions of
CSR in domestic empirical studies is primarily based on foreign literature, and choose
dimensions such as community relations, employee relations, diversity, protection of
consumer rights and interests, environment protection, product attributes and
treatment of women and minority groups. In addition to their conclusion, they also
argue that different stakeholders show interests to different dimensions of CSR. For
instance, consumers may care more about protection of consumer rights and interests,
whereas employees might be more interested in employee relations.
10
Su, Rong-Jia & Jie, Xiao-Wen (2015). Literature Review on Corporate Social Responsibility. Business
School of Sichuan University, Sichuan, China/Atlantis Press.
This review made by the authors was primarily connected to the businesses in
China. However, this review is also applicable to the Philippines because in general, most
countries in the world have yet to understand and introduce the concept of CSR in the
operation of their businesses. Therefore, with the documentation of the different
variables, the statement of the cited authors help the researchers in the identification of
possible variables that may be included in the investigation.
As contended by Spence, David (2010) 11, he expressed that the development of
better and more sophisticated CSR programs, fed and nurtured by a more transparent,
receptive approach to stakeholder engagement, represents their response to the
changing expectations of governments, Non-Governmental Organizations and
neighbours over the last several decades.
This only means that CSR activities are implemented to meet the demands of the
stakeholders of the enterprises especially on their demands in connection to welfare,
safety and care. This statement becomes a basis of the researchers to include
stakeholders as part of the study.
Based on a concept integration made by Visser, Wayne (2007)12, he concluded
that CSR tends to be less formalised or institutionalized in terms of the CSR benchmarks
commonly used in developed countries, i.e. CSR codes, standards, management systems
and reports. On the other hand, formal CSR is practiced usually by large, high profile
national and multinational companies, especially those with recognized international

11
Spence, David (2010). Corporate Social Responsibility in the Oil and Gas Industry: The Importance of
Reputational Risk. Chicago-Kent Law Review.
12
Visser, Wayne (2007). Corporate Social Responsibility in Developing Countries. Oxford University
Press.
brands or those aspiring to global status. Additionally, he also argued that there is an
urgent need for further research on CSR in developing countries at the international,
regional, national and sectoral levels, as well as on theoretical constructs. He also sees
the research of CSR as an opportunity and even contended that since it (referring to CSR)
is profoundly under-researched, it also represents a tremendous opportunity for
improving our knowledge and understanding about CSR.
According to a journal of Wang, S. (2015) 13 corporate reputation is an intangible
asset of firms because it promotes corporate performance and marketing returns
through value creation. The author’s study contends that corporate reputation deserves
more attention in future studies because it offers a unique competitive advantage for
firms. Corporate reputation can only be achieved and maintained through various CSR
activities that includes the stakeholders of the organization. The author also contends
that it is crucial to examine CSR related strategy at the individual level of the executive.
The implication of the journal written by Wayne and Wang directs readers to the
interpretation that an organization’s CSR certainly have an impact on its operation. The
last two authors contend that CSR is under-researched and therefore the researchers
use this as a basis to conduct this study. The statement of Wang directed the researchers
to include image and reputation as a variable while Wayne motivated the researchers to
include the barriers that affect the implementation of CSR as part of the issues to be
identified.
13
Wang, S. (2015). Chinese Strategic Decision-making on CSR: Literature Review of Corporate Social
Responsibility. Springer-Verlag Berlin Heidelberg.
Among the top writers who made various discussions on CSR, Kotler, Philip &
Lee, Nancy (2005)14, were one of them. The authors define CSR as a commitment to
improve community well-being through discretionary business practices and
contributions of corporate resources. They emphasised that it is “discretionary” and not
“mandatory”, except in some cases to which the law requires a mandatory
implementation of CSR programs. The book provides various reasons “why a company
should do good?” The reason include an increased sales and market share, strengthened
brand positioning, improved corporate image and clout, increased ability to attract,
motivate, and retain employees, decreased operating cost and increased appeal to
investors and financial analysts.
These things are just some of the areas which CSR greatly affects positively (or
negatively as the case may be) and which in turn affect the organization as a whole. This
was made a basis for including employee motivation and retention and image and
reputation.
As stated in the blog of Baker, Mallen (2004) 15, CSR is how companies manage
their business processes to produce an overall positive impact on society. It covers
sustainability, social impact and ethics, and done correctly should be about core
business - how companies make their money - not just add-on extras such as
philanthropy. According to the author, various definitions of CSR have been made and
14
Kotler, Philip & Lee, Nancy (2005). Corporate Social Responsibility Doing the Most Good for your
Company and Your Cause. John Wiley & Sons, Inc., Hoboken, New Jersey.
15
Baker, Mallen (2004). Definitions of corporate social responsibility - What is CSR? Mallen Baker’s
respectful business blog, Daisywheel.
written by numerous authors. However, the author also suggests that they broadly agree
that the definition now focuses on the impact of how you manage your core business.
This is the general idea and concept of CSR in today’s society and whether we like it
or not, CSR greatly contributes to the success of the business. The statement of Mallen
was the basis for including sustainable development and community advancement as
concerns of the study.
2.1.1.3. Water and Electric Suppliers and Distributors in General
The distributing and supplying of water and electric resources are part and parcel
of public service. Public services are considered as the widest area of service provision. It
includes transportation, gas supply and distribution, water and electric resource,
education services, health services, etc. These public service providers must be
responsible and give acknowledgement to the community where they operate.
According to Staats, Elmer (1988)16 these “public services are a concept, an attitude, a
sense of duty- yes, even a sense of public morality”. This is the reason why many
scholars believe that these public service providers should have sense of responsibility
towards the community.
In lieu with this, ironically, some companies who obtain their resources from the
environment and community do not contribute and help for the betterment of the
society.
16
Staats, Elmer (1988). Public Service and the Public Interest. Public administration review.
Sutton, Christopher (2007)17 claimed that utilities firms play integral roles in
creating wealth in both the developed and developing worlds. Additionally, he also
argued that water and sanitation, for instance, are fundamental to human sustenance,
health and dignity, and by extension to economic opportunity. Affordable and reliable
energy is integral to household productivity and the development of most industries,
from agriculture to finance to health care to communications. As he explained, the water
and electric utilities are one of the most important public services that give life to
livelihood and are becoming foundation of the development of various industries.
Water and electric utilities are expected to implement and carry out CSR
programs like any other business organization. These organizations must operate
responsibly and give due acknowledgment to every stakeholder that their organization
have. Whether or not they want to help or to just simply abide with the laws, they must
give back to the community. Whatever reason that drive these public utilities to promote
welfare, may become a ground for them to be successful. As David Brower (Executive
Director, Sierra Club) once said “There is no business to be done on a dead planet.”
These various concepts become the basis of this study and be considered as the starting
point of the investigation to be made. Probing and analysing concepts and theories
become helpful and nurture the mind. Hence, the ideas presented become part and
parcel of the foundation of this study.
2.1.2. Local Literature
17
Sutton, Christopher (2007). The Role of Utilities Sector in Expanding Economic Opportunity. John F.
Kennedy School of Government, Harvard University.
2.1.2.1. Corporate Social Responsibility in the Philippine Context
As presented by Maximiano, Jose Mario (2005) 18, CSR may be divided into four
areas. These areas are social investment, corporate community partnership,
environmental stewardship and managing workplace concerns. Under social investment,
this area include the supporting of programs to address social issues and locating
facilities or jobs in economically depressed communities. The areas of corporate
“community partnership” includes but not limited to financial contributions to the
community, hiring people from the community and engaging the community with the
operation of the business. Environmental stewardship comprises of areas such as proper
waste management, encouragement of water and energy conservation, making
purchases from responsible partners in the community and assumption of responsibility
to environmental impacts of the operation. Lastly, the area of workplace concern
management embraces compensation and benefits management, providing best
conditions for working places and training and development of employees and other
opportunities.
These four areas will be used by the researchers as a basis for grouping the CSR
programs of CAGELCO 1 and MTWD. The four areas will become the basis for identifying
CSR activities according to their nature and type.
As presented by Yap, Joseph, Dar Juan, Elijah John & Perez, Martin Julius (2013) 19
companies with CSR initiatives aim to do good for the community as a way of thanking
18
Maximiano, Jose Mario (2005). The State of Corporate Social Responsibility in the Philippines.
Australian Association for Professional and Applied Ethics 12th Annual Conference, Adelaide.
19
Yap, Joseph, Dar Juan, Elijah John & Perez, Martin Julius (2013). Corporate Social Responsibility
Programs in Philippine Libraries. 3rd International Conference of Asian Special Libraries.
them for their usual support to products or services. CSR is also collaborating with
affiliates with large investments, e.g. banks and financial institutions. The presentation
was made by the authors primarily to look into the CSR of companies here in the
Philippines when it comes to library partnerships with local and external organizations.
The various companies consider CSR as a voluntary way of giving back to the community
as being supporters rather than being a mandatory activity required by ethical and legal
standards of the Philippine community.
In a journal of Rimando, Lala (2012)20, it proposes that there is a favorable
enabling environment for CSR to thrive in Philippine companies because people at the
top support and push it within the organization. Additionally, the author also argues that
most of the CSR activities are still mainly philanthropy and event-driven, but employee
volunteerism has become more prominent in the CSR designs. Nevertheless, the survey
also shows that “results assessment”, which is basis for further improvement, is
generally weak while communication means is still traditional. But most of all, "goodwill"
is a main motivation for companies to engage in, report, and communicate about their
CSR, but business economics motivate financial support.
Generally speaking, CSR is a new concept in Asian countries and as stated by
foreign authors, the concepts and ideas of CSR are “under-researched” and hence the
need to investigate further to be used as future reference of other authors and of
businesses. The last two authors mentioned, establishes the present state of CSR in the
businesses that operate in the Philippines.
20
Rimando, Lala (2012). How CSR is Evolving in the Philippines. Rappler, Philippines.
2.1.2.2. Philippine Laws on Corporate Social Responsibility
The legislative branch of the Philippine government had also became concerned
with the integration of CSR activities and programs especially to promote the general
welfare of the people and to promote responsible operation of industries and all profit
oriented businesses.
One of the laws enacted by the legislature is the Volunteer Act of 2007 21. The law
which was approved on April 10, 2007 by president Gloria Macapagal-Arroyo was
enacted for the purpose of promoting the participation of the various sectors of the
Filipino society, and as necessary, international and foreign volunteer organizations in
public and civic affairs, and adopt and strengthen the practice of volunteerism as a
strategy in order to attain national development and international understanding.
Furthermore, its purpose is to promote the inculcation of volunteerism as a way of life
which shall or may rekindle in every Filipino the time-honored tradition of bayanihan to
foster social justice, solidarity and sustainable development.
The scope of the law are the private sectors, foreign volunteer organizations and
the government. The scope of private sectors includes educational institutions, business
and enterprises and not-for-profit organizations. Under the scope of businesses, the
volunteerism in the corporate sector should be made as an expression of corporate
social responsibility and citizenship, it refers to activities recognized by the company,
where employees give their time, skills and resources in the service of the company's
21
Republic Act No. 9418 otherwise known as Volunteer Act of 2007. Approved: April 10, 2007.
internal and/or external communities. These volunteering activities include, but are not
limited to, employee giving of material resources to specific causes; employee-led fund-
raising; one-time outreach activities; environmental campaign; medical and health
related advocacies; knowledge and change management; scholarship programs; and
sharing of expertise, particularly of business and developmental skills through
mentoring, tutoring, training, business, consulting/advising and rendering of pro bono
services on a case-to-case basis.
The essence therefore of the law is to motivate and inspire the different sectors
to act with initiative and volunteerism without mandating and forcibly requiring them to
be responsible to the community and to the environment. The government do not
compel them to act but only waits for them to act among themselves. The tradition of
bayanihan of Filipinos is strengthened and given due importance.
In June 02, 2011, the House of Representatives passed House Bill 4575 on its
third and final reading. The bill was created through the initiative of Rep. Diosdado
Arroyo (2nd District, Camarines Sur) and Rep. Gloria Macapagal-Arroyo (2nd District,
Pampanga) which pushed to strengthen sustainable economic and environment
development and protection by institutionalizing corporate social responsibility in both
domestic and foreign corporations. Senate Bill 2747, a similar bill authored by the senate
through the initiative of Sen. Manny Villar was also passed on March 16, 2011. As of May
11, 2011, the bill is still pending on its second reading and since then, no further actions
were made by the Senate.

Luckily, we have the Volunteer Act of 2007 which still encourages various sectors
to voluntarily act and which include the encouragement of business organizations to
implement various CSR programs and activities that may help in the advancement of the
community and the preservation of the environment.
The legislations may not be enough, but at least the government, particularly the
legislature are making some efforts to encourage and motivate the private sectors to
become socially responsible to their stakeholders particularly to the community where
they operate.
2.1.2.3. Brief History of Laws and Legislations Concerning Public Utilities

2.1.2.3.1. Electric Utilities
According to Antonio, Henry (2013) 22, the National Power Corporation (NPC) was
established in 1936 to construct, operate and maintain facilities for the production of
electricity. Since its establishment and until the landmark power industry reform law was
passed in 2001, NPC has been at the forefront of the power industry, both in power
generation and in transmission.
The NPC today have evolved in various ways form the time of its conception
through laws, until it was passed from administration to administration.
In 1972, President Ferdinand E. Marcos signed into law Presidential Decree No.
4023. The said law was enacted to promote the economic welfare of the people to hasten
electrification of the entire country, more particularly the rural areas; and to establish
22
Antonio, Henry (2013). The Energy Report Philippines: Growth and Opportunities in the Philippine
Electric Power Sector. KPMG Global Energy Institute.
23
Presidential Decree No. 40 otherwise known as the law “Establishing Basic Policies for the Electric
Power Industry. Approved: November 7, 1972.
basic policies for the attainment of said objective. The law created the National Power
Corporation (NPC) to set up transmission line grids and the construct associated
generation facilities in Luzon, Mindanao and major islands of the country, including the
Visayas. It also included the setting up of island grids with central/linked-up generation
facilities and the setting up of cooperatives for distribution of power. This was the start
of the existence of NPC and the Cooperatives of different provinces who will be
responsible for electric distribution.
In 1987, President Corazon C. Aquino issued Executive Order No. 215 24. The order
was primarily issued not to amend the entirety of Presidential Decree No. 40 but to
amend Numbers 2, 4, 5 and 6 of the said decree. The law was grounded on the belief
that the generation of electricity, unlike its transmission and distribution, is not a natural
monopoly and can be undertaken by more than one entity. The law provides that private
corporations, cooperatives and similar associations may construct and operate certain
types of electric plants subject to the rules and regulations of the said order. This was
the start of the coordination between the government and the private sectors in the
electric industry.
In 1990, the congress enacted Republic Act No. 695725. The law was popularly
called BOT Law. The term BOT refers to Build-operate-and-transfer. This scheme as
defined in the law means, a contractual arrangement whereby the contractor
24
Executive Order No. 215 otherwise known as the law Amending Presidential Decree No. 40 and Allowing
the Private Sector to Generate Electricity. Approved: July 10, 1987.
25
Republic Act No. 6957 otherwise known as An Act Authorizing the Financing, Construction, Operation
and Maintenance of Infrastructure Projects by the Private Sector, and for the Other Purposes. Approved:
July 09, 1990.
undertakes the construction, including financing, of a given infrastructure facility, and
the operation and maintenance thereof. The contractor operates the facility over a fixed
term during which it is allowed to charge facility users appropriate tolls, fees, rentals,
and charges sufficient to enable the contractor to recover its operating and maintenance
expenses and its investment in the project plus a reasonable rate of return thereon. The
contractor transfers the facility to the government agency or local government unit
concerned at the end of the fixed term which shall not exceed fifty (50) years. From the
term itself, it allows investors to build and operate certain infrastructure including
electric plants. After a certain period of time, the investor transfers the absolute
ownership to the government.
In 1993, the legislature enacted Republic Act No. 7648 26. The law was enacted
primarily to solve the electric power crisis during the Ramos Administration. The law
allowed the President to enter into negotiated contracts for the construction, repair,
rehabilitation, improvement or maintenance of power plants, projects and facilities. It
also allowed the President to fix the rate of return on rate base of the National Power
Corporation (NAPOCOR) to not more than twelve percentum (12%) of the rate base. The
law also reorganized the NAPOCOR, to make it more effective, innovative, and
responsive to the power crisis. The said law was a grant of an emergency power to the
President to resolve the current issue on electric crisis.
26
Republic Act No. 7648 otherwise known as Electric Power Crisis Act of 1993. Approved: April 12, 1993.
In 1994, the congress amended certain provision of Republic Act No. 6957. This
law is Republic Act 7718 27. The law amended Section 2 of the old law and included the
definition of the word infrastructure and other pertinent terms used in the law. The term
BOT was cleared and included in its definition that it shall include a supply-and-operate
situation which is a contractual arrangement whereby the supplier of equipment for a
given infrastructure facility, if the interest of the government so requires, operates the
facility providing in the process technology transfer and training to Filipino Nationals. It
also amended Sections 3, 4, 5, 6, 7, 8, 9 and 11 and added Sections 4-A, 10 and 12 of
Republic Act No. 6957.
2.1.2.3.2. Water Utilities
In 1973, President Ferdinand E. Marcos created Presidential Decree No. 198 28.
The law was created particularly to organized water districts for more effective and
efficient distribution of water resources around the country. The law allowed the
creation of Local water districts which may be formed for the purposes of acquiring,
installing, improving, maintaining and operating water supply and distribution systems
for domestic, industrial, municipal and agricultural uses for residents and lands within
the boundaries of such districts, providing, maintaining and operating water collection,
treatment and disposal facilities, and also conducting such other functions and
27
Republic Act No. 7718 otherwise known as An Act Amending Certain Sections of Republic Act No. 6957
Entitled “An Act Authorizing the Financing, Construction, Operation and Maintenance of Infrastructure
Projects by the Private Sector, and for the Other Purposes”. Approved: May 08, 1994.
28
Presidential Decree No. 198 otherwise known a Provincial Water Utilities Act of 1973. Approved: May
25, 1973.
operations incidental to water resource development, utilization and disposal within
such districts, as are necessary or incidental to said purpose. The law also created "Local
Water Utilities Administration" for the purpose of (1) establishing minimum standards
and regulations in order to assure acceptable standards of construction materials and
supplies, maintenance, operation, personnel, training, accounting and fiscal practices for
local water utilities; (2) furnishing technical assistance and personnel training programs
for local water utilities; (3) monitoring and evaluating local water standards; (4) effecting
system integration, joint investment and operations district annexation and
deannexation whenever economically warranted; and (5) providing a specialized lending
institution with peculiar expertise in the financing of local water utilities.
In 1975, Presidential Decree No. 856 29 was issued by President Ferdinand E.
Marcos to ensure sanitation in public utilities. The law states that the health of the
people, being of paramount importance, all efforts of public services should be directed
towards the protection and promotion of health and with the advance in the field of
sanitation in recent years, there arises the need for updating and codifying our scattered
sanitary laws to ensure that they are in keeping with modern standards of sanitation and
provide a handy reference and guide for their enforcement. Under the said chapter, it
gives the Department of Health the right to supervise the standards for drinking water
and their bacteriological and chemical examinations, together with the evaluation of
results, shall conform to the criteria set by the National Drinking Water Standards. The
29
Presidential Decree No. 856 otherwise known as Code on Sanitation of the Philippines. Approved:
December 23, 1975.
law paved way to the supervision and control of water services including the local water
utilities.
In 1995, during the water crisis, a law was passed by congress to address the
issue. This law was Republic Act No. 804130. The law resolved the current problem by
organizing the Joint Executive-Legislative Water Crisis Commission whose purpose is to
(a) undertake nationwide consultations on the water crisis and in depth and detailed
study and review of the entire water supply and distribution structure, (b) enhance and
facilitate cooperation and coordination between Congress and the executive department
in formulating and implementing the government's water crisis management policy and
strategy, (c) recommend measures that will ensure continuous and effective monitoring
of the entire water supply and distribution system of the country and (d) conduct
continuing studies and researches on policy options, strategies and approaches to the
water crisis including experiences of other countries similarly situated, and to
recommend such remedial and legislative measures as may be required to address the
problem.
In 2004, President Gloria Macapagal-Arroyo signed into law Republic Act No.
927531 purposively to (a) streamline processes and procedures in the prevention, control
and abatement of pollution of the country's water resources, (b) promote environmental
strategies, use of appropriate economic instruments and of control mechanisms for the
protection of water resources, (c) formulate a holistic national program of water quality
30
Republic Act No. 8041 otherwise known as National Water Crisis Act of 1995. Approved June 07, 1995.
31
Republic Act No. 9275 otherwise known as Philippine Clean Water Act of 2004. Approved March 22,
2004.
management that recognizes that water quality management issues cannot be
separated from concerns about water sources and ecological protection, water supply,
public health and quality of life, (d) formulate an integrated water quality management
framework through proper delegation and effective coordination of functions and
activities, (e) promote commercial and industrial processes and products that are
environment friendly and energy efficient, (f) encourage cooperation and self-regulation
among citizens and industries through the application of incentives and market-based
instruments and to promote the role of private industrial enterprises in shaping its
regulatory profile within the acceptable boundaries of public health and environment,
(g) provide for a comprehensive management program for water pollution focusing on
pollution prevention, (h) promote public information and education and to encourage
the participation of an informed and active public in water quality management and
monitoring, (i) formulate and enforce a system of accountability for short and long-term
adverse environmental impact of a project, program or activity and (j) encourage civil
society and other sectors, particularly labor, the academe and business undertaking
environment-related activities in their efforts to organize, educate and motivate the
people in addressing pertinent environmental issues and problems at the local and
national levels.
The laws pertaining to infrastructure, especially Republic Act No. 6957 and
Republic Act N0. 7718 are both applicable to water and electric utilities. The plants and
infrastructure which are used in the operation of these public services are covered by
the said laws.

2.1.2.4. Information and Profiles of the Subjects
To be able to understand more about water districts as well as electric
cooperatives that operate in the locality, particularly in Tuguegarao City, there is a need
to present some information regarding the two public utilities. The following pieces of
information can be used as a guide in conducting this study especially in the
communication procedures to be made with the organization. It may also be used as a
guide for the readers to understand well the geographical coverage of the study and the
scope of the vicinity in which these public utilities are set up as well as the current status
of their services and facilities.
2.1.2.4.1. CAGELCO 1 (Cagayan Electric Cooperative, Inc.)32
FIGURE 2. Coverage Service Area of CAGELCO 1
32
In the succeeding presentation, all pieces of information including photographs were obtained from
CAGELCO 1 website. Retrieved: http://www.cagelco1.org.ph/center.html.
The CAGELCO 1 is one of the two electric cooperatives organized in the province
of Cagayan. It was registered on November 15, 1971. The old Tuguegarao Electric Power
Company, owned by the Stoops and Andrews clan, was the one who managed the
distribution of electric power in the City of Tuguegarao. In 1976, the CAGELCO 1 took
over the electric distribution in the capital and thus having a total of twelve
municipalities as its coverage. The other eleven municipalities are Alcala, Amulung,
Baggao, Enrile, Iguig, Peñablanca, Solana, Piat, Faire (Sto. Niño), Tuao and Rizal. Figure 1
provides for the geographical location of the coverage area in the Philippine map and
indicating the boundaries of each municipality which it provides electricity for.
Energinzed Barangays Connections

Municipality Potential Actual % Potential Actual to % Members
to Date Date hip
Alcala 25 25 100 8,735 7,494 85.79 7,880
Amulung 47 47 100 9,694 8,179 84.37 7,960
Baggao 48 48 100 18,012 12,136 67.38 12,114
Enrile 22 22 100 6,764 7,317 108.18 7,136
Faire 31 31 100 6,122 4,125 67.38 4,010
Iguig 23 23 100 5,553 5,909 106.41 5,511
Penablanca 24 24 100 9,249 8,300 89.74 7,518
Piat 18 18 100 5,273 4,717 89.46 4,518
Rizal 29 29 100 3,754 2,080 55.41 2,072
Solana 38 38 100 16,606 14,508 87.37 14,866
Tuao 32 32 100 13,004 9,346 71.87 8,791
Tuguegarao 49 49 100 29,649 40,401 136.26 31,020
TOTAL 386 386 100 132,415 124,512 94.03 113,396
TABLE 1. Electrification Status of Cagayan as of 2014
As of 2014, the status of electrification in the province is 100%. This status was
achieved with the combined effort of the government through its agency, the National
Electrification Administration (NEA) and the CAGELCO 1. The said program was called the
Sitio Electrification Program (SEP) which started in 2011.
The cooperative is considered as one of the top performing electric distributors
in the province and even in the country. In fact, the National Electrification
Administration (NEA) recognized the top performing Electric Cooperatives during the
Annual NEA-EC Lumens Award held in Davao Insular Hotel, Lanang, Davao City last April
27, 2012. Accordingly, CAGELCO 1 received a plaque, “Special Award for Category A+ EC”
for an outstanding performance in its operations and for a continuing improvements of
its distribution systems to ensure quality service to its consumers.
2.1.2.4.2. MTWD (Metropolitan Tuguegarao Water District)33
The original water district who distribute water resources in the city is managed,
built and owned by the Bureau of Public Works in 1924. However, these well sources
went out of service when their pumping facilities broke down. Within the same period,
the management and operation of the water system has already been transferred to the
National Waterworks and Sewerage Authority, popularly known as NAWASA on
November 18, 1957 and then retransferred to the provincial government. Ten years after
that, with the passage of the Provincial Water Utilities Administration Act, the ownership
and management was transferred to the Municipal Government of Tuguegarao.
In April 6, 1977, Municipal Resolution No. 46 was passed by the municipal
government and this was the beginning of the existence of Tuguegarao Water District.
33
In the succeeding presentation, all pieces of information including photographs were obtained from
MTWD website. Retrieved from http://www.mtwd.gov.ph/#.
This transfer of management from the government to the water district was made on
August 1, 1978 and pursuant to the passage of the Provincial Water Utilities
Administration Act of 1973. On October 4, 1978, the government, through the Local
Water Utilities Administration then awarded the TWD with a Conditional Certificate of
Conformance to operate in the distribution of water resources in the municipality.
FIGURE 3. MTWD Organizational Structure
The figure above shows how the management system of MTWD is arranged and
who reports to whom. The BOD, like any other company is the highest among all.
In their first year of operation, they have a total of 323 water service
connections. As of December 31, 2016, the total number of connections totaled to
overwhelmingly 34,934. In 2003 and 2004, when the TWD merged with the Solana
Water District and the Piat Water Service respectively, the TWD was renamed to MTWD.
Name of Location Well Well Casing Well Elevation Drilled &

Production Depth Capacity Constructed
Facility Diameter
Annafunan Annafunan, 68 300 m/m x 1,140,480 20 March 8,

Pumping Tuguegarao meters 250 m/m gallons meters* 1995
Station City, Cagayan ø per day
(50 liters
per
second)
Buntun 1 Buntun, 100 250 m/m 1,140,480 21 May 31,
Pumping Tuguegarao meters ø gallons meters* 1983
Station City, Cagayan perforated per day
(50 liters
per
second)
Buntun 1A Buntun, Meters m/m ø gallons Meters* 2010
Pumping Tuguegarao per day
Station City, Cagayan
Buntun 2 Buntun, 78 350 m/m 1,368,876 21 1987
Pumping Tuguegarao meters ø gallons meters*
Station City, Cagayan per day
(60 liters
per
second)
Calamagui Solana, 72 300 m/m 64.09 22 March 16,
Pumping Cagayan meters ø liters per meters* 2006
Station second
Cataggaman Caataggaman, 92 300 m/m 1,460,736 18 March 16,
Pumping Tuguegarao meters ø gallons meters* 2006
Centro Solana, Meters m/m ø gallons Meters*
Solana Cagayan per day
Pumping
Station
Larion Bajo Larion Bajo, 83 300 x 250 1,368,576 20 April 28,
Pumping Tuguegarao meters m/m ø gallons meters* 2000
Linao North Linao North, 63 300 m/m 60 liters 17.16 May 26,
Pumping Tuguegarao meters ø per meters* 2006
Station City, Cagayan second
Maguilling Maguilling 90 300 m/m 74 liter 37.87 September

Pumping Piat, Cagayan Meters ø per meters* 24, 2006
Station second
Namabbala Namabbalan, 50 200 m/m 15.08 27.13 December
n Pumping Tuguegarao meters ø liters/ meters* 1, 2007
Station City, Cagayan second
Pallua Pallua Sur, 86 300 m/m x 1,140,480 19 May 28,

Pumping Tuguegarao meters 250 m/m gallons meters* 1996
Station City, Cagayan ø per day
Panacal Panacal 86 300 m/m 17.53 28.66 May 26,

Pumping Village, meters ø liters/ meters* 2007
Station Tuguegarao second
City, Cagayan
Parabba 1 Parabba, 38 300 m/m x 684,288 30.85 March 8,

Pumping Penablanca, meters 250 m/m gallons meters* 1996
Station Cagayan ø per day
Parabba 2 Parabba, 38 350 m/m 1,710,720 25.42 1998

Pumping Penablanca, meters ø gallons meters*
Station Cagayan per day
San Gabriel Buntun, 75 350 m/m 798,336 22 1987
Tuguegarao meters ø gallons meters*
City, Cagayan per day
Legend: * (above mean sea level)
TABLE 2: Current Status of Pumping Stations of MTWD
Currently, there are 16 pumping stations and facilities operating in various places
in the province. These stations cater to the needs of every household within the reach of
every facility. These stations serve as the sources of water to be distributed in the
coverage area which the MTWD serves. Most of them are found within the vicinity of
Tuguegarao City where the main office of the water district is found.
2.2. Related Studies

The succeeding topics will discuss both international/foreign and local studies
that have been conducted in connection to CSR of companies and businesses. The
studies are combination of bachelor thesis, master thesis and dissertations. The
researches ranges from qualitative to quantitative researches. As the discussion
progresses, some concepts would be uncovered and be incorporated in this study. The
differences, similarities and also the advantages of this study compared to the previous
studies is also a coverage of this review. The researchers would like to note that the
advantages of this study when compared to the previous ones are more of an
improvement and slight change of course due to the minor difference on the purpose of
the study or the thesis title. The advantages will not be considered and never be referred
to as a mode of belittling and demeaning the old and previous researches.
2.2.1. Local Studies
An investigation was conducted by Romero, Frederick (2015) 34 and which showed
that there has been an increasing development of Corporate Social Responsibility
actions by the corporations. It also provides that there exist a significant evidence that
banking institutions in the Philippines are already being conscious of the societal and
environmental problems that the country has been currently experiencing. Hence, these
banking institutions also creates goodwill in the minds of the public, thus, the
confidence of these customers towards these banks increases throughout time and can
34
Romero, Frederick (2015). A Cross-case Study on Corporate Social Responsibility (CSR) in the
Philippines: A Comparative Analysis on Perspectives from the Top Banking Institutions in the Philippines
from 2010-2014. GSTF Journal on Business Review.
provide value to the banks. This study was conducted in the Philippines specifically to
determine the coverage on the social aspects of the top Philippine banking institutions
for a four year period.
The Romero study is similar with the present study in the sense that both are
focused on the CSR of businesses. The significant difference on the other hand is that
this research will study on the electric and water suppliers in the locality and not on the
banking institutions. The lacking area of the old study is that it does not touch the
various factors which is affected by the implementation of CSR. It only lunged into the
implementation and not anymore into its effects to the companies, whether good or
bad.
The study conducted Georgescu, Gabriela (2016) 35 proposed that the
implementation of CSR is very much dependent on the company’s size, big companies
have a multi-stakeholder approach while small companies focus more on philanthropy.
Furthermore, the challenge for the companies is to incorporate a human rights-based
approach when implementing CSR and at the same time to promote their CSR policies
within their entire organization. The aim of the study was to better understand the CSR
situation of Ten (10) Japanese Companies operating in the Philippines while at the same
time to contribute to the limited amount of literature on CSR in developing countries.
The Georgescu research is the same with this study because both emphasizes the
role of CSR in the life of the organizations. A significant difference can be seen especially
35
Georgescu, Gabriela (2016). Patterns of Corporate Social Responsibility in the Philippines: A Case
Study of Japanese Companies Operating in the Philippines. Graduate School of International
Collaboration, Osaka Jogakuin University.
on the subject matter being studied. The scope of this study is limited only to local
companies operating within the city. This research do not only look to the different
approaches on how businesses implement CSR programs but also on how these
programs may possibly relate to the success of the organization.
A thesis was presented by Magpantay, Hana Lea (2011) 36 which emphasized that
there is a significant relationship between the CSR and the sustainability of SMEs as
measured in the net income of the business. Further analysis also provides that an
increase in the employee’s benefits should be given importance by the SMEs. The study
was conducted to investigate on the CSR of SMEs found in Paranaque City. The subjects
were food service industries found in the said city.
There are some differences to be noted between the two studies, first is on the
nature of business being studied, second is on the interrelation between the CSR
programs and activities implemented by the businesses. This thesis will not only look
into the interconnection between the CSR and sustainability but more so on the overall
business operation of the organization which is considered to be either beneficial or
destructive on the part of the undertaking.
A similar study was also conducted by Maximiano, Jose Mario (2005) 37 which
provided that regardless of the size of their company, business executives in the
Philippines see corporate citizenship as a fundamental part of business. Furthermore,
36
Magpantay, Hana Lea (2011). Corporate Social Responsibility of Small and Medium Food Enterprises in
the City of Paranaque. School of Industrial Engineering and Engineering Management, Mapua Institute of
Technology.
37
Maximiano, Jose Mario (2005). The State of Corporate Social Responsibility in the Philippines.
Australian Association for Professional and Applied Ethics 12th Annual Conference, Adelaide.
most company managers say they view corporate citizenship as central to good business
practice. Additionally, based on the percentages, 82 percent of executives surveyed say
that good corporate citizenship helps the bottom line while 59 percent say these
practices improve the image and reputation of the company and 53 percent say
corporate citizenship is important to their customers.
The previous research is similar with this study because both of them are
concerned with the relationship between the CSR of the company and the responsibility
of the company. There are additional similarities between the two such as the emphasis
of the old research on what drives a company to implement CSR programs in which this
research also cover. The difference that can be inferred is on the portion where this
research focus on a particular type of business enterprise to become the subject of the
study. This is the advantage of this study.
An investigation made by Buenviaje, Maribeth (2013)38 exposed that managers
and employees perceive that food establishments in the province of Batangas adhere to
a great extent to the imperatives as economic, ethical, and legal corporate social
responsibility practices but to a moderate extent on the philanthropic aspect, while
customers perceptions show to a moderate extent to the ethical, philanthropic and legal
aspects but to the least extent in the economic aspect. As a summary, it means that food
service establishments have strong commitment to peoples’ welfare. Generally, the
study determines the extent of adherence of food service establishments in the
38
Buenviaje, Maribeth (2013). Practices of Managing Corporate Social Responsibility: Based from the
Best Food Service Establishments. E – International Scientific Research Journal/ Lyceum of the Philippines
University, Capitol Site, Batangas City, Philippines.
imperatives of corporate social responsibility, their problems encountered and
comparison on the perceptions of the managers, employees and customers.
The Buenviaje research is distinctively different with this research because the
subjects of the study are diverse. Food establishments and energy distributors are
different from each other and are not even interrelated. The similarity on the other hand
is that the two researches investigates on the adherence of the businesses to the
implementation of CSR activities. What makes this study advantageous is on its probing
on the effects of CSR to the overall performance of the enterprise.
Another study was conducted by Amador, Ryan (2017) 39 which aimed in exploring
prospective areas of rural energy development in the Philippines. It was revealed that
there seem to be a shortage of a more comprehensive look into innovative ways in the
practice of urban/regional planning on community-based-arrangement in the field of
small-scale Rural Renewable Energy. Evidence from credible resources in rural energy
planning practice have indicated a shortage of the approach towards rural energy
planning which remains typically non participatory.
The cited study is the same with this research especially on the subject which are
both electric distributors. The significant difference to be noted is that this research will
not going to explain and expound further the things that may be considered as
innovative ways in resolving energy shortage. It will only search on the interconnections
between the CSR of a company and its success in the operation and management of its
39
Amador, Ryan (2017). Rural Renewable Energy Based Infrastructure of the Philippines. School of
Continuing Studies, Georgetown University.
set-up. The advantage of this study therefore is on the wider scope of the factors and
variables being studied and researched upon.
2.2.2. Foreign Studies
According to a study conducted by Cedillo Torres, Cristina, Garcia-French,
Mercedes, Hordijk, Rosemarie, Nguyen, Kim & Olup, Lana (2012) 40 multi-national
companies have adopted changes in their CSR and reporting policies after some conflicts
occurred. The aforesaid study was conducted to know how Apple, Coca-Cola, Walmart
and Canon have solved conflicts which affected their earnings. It was thereafter
concluded by the researchers that the four companies are transparent about the
emerging conflicts by publicly addressing them either through the media or in their
annual or sustainability reports. They solved their problems by implementing CSR
activities so that their level of profitability will not be very much affected.
The similarity of the previously presented study with this study is obvious. The
old one studied existent CSR and the present one will also answer the question “what
are the present and existing CSR activities implemented by the subject enterprises?”
Therefore this study will focus more on the ‘possibly’ existing CSR of the two companies.
Nonetheless, the two studies are comparable in such a way that they both tackle CSR
and their business organizations.
40
Cedillo Torres, Cristina, Garcia-French, Mercedes, Hordijk, Rosemarie, Nguyen, Kim, Olup, Lana
(2012). Four Case Studies on Corporate Social Responsibility: Do Conflicts Affect a Company’s Corporate
Social Responsibility Policy? Utrecht Law Review.
As presented by Harildstad, Stine Mari (2014) 41 in his study, he has used the
water situation in India as a case and suggested a model for sustainable water use that
Norwegian companies can use in their CSR strategy. The study was conducted in Norway
to exemplify how and why water issues should be a part of a company’s CSR, and what
initiatives that is relevant for companies in India. It was concluded that there is a linkage
between water issues on a macro level and on companies’ level.
Both the Harildstad research and this research talks about CSR of businesses. A
specific similarity on water conservation and issues was also highlighted on both studies.
They are similar in a way that this study will research on the CSR of a water distributor in
the locality. Similarly, the previous research and the research conducted by Cedillo
Torres, Cristina et al. both studied CSR that have already been implemented. This study
will also research on the same matter. The edge of this research is on the number of
subjects because this will include the two businesses inclined in the supply of water and
electricity.
Yee Ching, Sabrina & Wad, Peter (2009) 42 conducted a study in Malaysia. The
study revealed that the level of CSR practices is positively influenced by the degree of
OO (Offshore Outsourcing) activities. In addition, the size of the company’s workforce
and degree of foreign ownership also have a significant impact on the firms’ CSR
practices. It was also found out that no apparent relationship existed between the CSR
41
Harildstad, Stine Mari (2014). Water Management and Corporate Social Responsibility Norwegian
Companies' Experiences and Strategies of Water Usage in India as a Response to International Water
Initiatives. Norwegian University of Science and Technology, Norway.
42
Yee Ching, Sabrina & Wad, Peter (2009). Corporate Social Responsibility and Offshore Outsourcing:
Electrical and Electronics Firms in Malaysia. International Journal of Institutions and Economies.
and the firms’ profitability and leverage. Secondly, it also appears that the government
plays an important role shaping the perception, rhetoric and organization of CSR
activities by firms.
The previous study is the same with this research because both looks into the
deeper essence and purpose of a CSR. The only difference is that this study will not
anymore focus on the Offshore Outsourcing activities of the public providers of water
and electricity. The advantage therefore of this research is on the particular study of a
certain business enterprise’ CSR and its effects to its operations.
Another related research is conducted by Bruhn, Sheena (2013)43 which
uncovered that McDonald’s uses CSR as a defensive strategy to safeguard its reputation,
or at least as an attempt to make its reputation as strong as possible in order to prevent
damage of its overall image, caused by its inevitable connection with the health and
obesity issue. The study was conducted to find out how McDonalds used CSR and
associated sub questions of how its consumer’s perceive this as well as how these
perceptions influences McDonald’s overall corporate image and reputation. The study
also revealed that there is a prevailing discourse of distrust in the “Quality Matters
Most” post of McDonalds in their social media post.
The similarity between the two researches is that both are focused on the CSR, in
businesses and on the effects of their social responsibility towards the community with
that of their image and reputation. Their difference on the other hand is on the subject
43
Bruhn, Sheena (2013). Corporate Social Responsibility: A Case Study of Consumers’ Perception of
McDonald’s Use of CSR in Relation to Image & Reputation. Business and Social Sciences, Aarhus
University, Denmark.
of the study. The old one made used of a fast-food chain while the present one made
used of a public service provider particularly water and electric suppliers and
distributors. The advantage of this study is more on the particularity of the stated
problems rather than the effects of CSR to the overall image of the company without
stating the different areas that CSR may affect.
Chan, Lok (2014)44, conducted a study in Tacoma Washington. The study was
conducted to know the significance of CSR and explore what companies have done to
contribute to the world by comparing Apple and Microsoft which are the two well-
known multinational corporations in the information technology industry. The previous
study revealed that the two companies are not only concerned about profits; they are
more interested in company regarding various economic, environmental, ethical,
governance, and social aspects, since these factors significantly affect the fate of the
company in long term.
The previous study is similar with this present one in terms of the topic it tackles.
The topic is all about the CSR implementation as a way of providing a betterment of the
company for a long period of time rather that profitability in the long run. The difference
is that this research do not use technological companies, rather it made use of public
services particularly water and electric companies. The other similarity of the two
studies is to dive deeper into the CSR being implemented by the companies and
interconnecting and comparing them with each other. With this, we can focus more on
44
Chan, Lok (2014). Corporate Social Responsibility of Multinational Corporations. University of
Washington, Tacoma, Washington.
the strengths and weaknesses of the companies separately and at the same time
comparatively.
In a study conducted by Reinlie, Maria (2017) 45, it discovered that the
stakeholders can provide the (social) need-pull in the innovation process, and thus work
as a catalyser for innovation. It also stressed that a strategic CSR can drive a company to
capitalize on economic potential outside the firm, and enable corporations to detect
opportunities for innovation that they otherwise could have missed. The said study was
conducted in Norway which studied a connection between CSR and innovation at
concept level and through a case study of the Brazilian oil and gas company Petrobras.
As concluded, CSR is one of the elements that can affect innovation.
The difference of the Reinlie research with this research is on the manner of
interconnecting concepts. The previous research have connected the concept of
innovation with that of the CSR implementation of the oil and gas company. There is also
somewhat a difference on the number of subjects. The similarity is on the subjects
which are closely related to each other which both provides public service. The
advantage of this study can be inferred from the differences which dictates that this
study does not include in its scope the connection between innovation and CSR but on
the connection of CSR to the overall operation and profitability of the business.
45
Reinlie, Maria (2017). Corporate Social Responsibility (CSR) and Innovation: Exploring the Connection
between CSR and Innovation - at Concept Level and through a Case Study of the Brazilian Oil and Gas
Company Petrobras. TIK Centre for Technology, Innovation and Culture, University of Oslo, Norway.
A similar research was also made by Querol-Areola, Eunice Mareth (2017) 46,
wherein it revealed mixed results whereby the CSR and Financial Performance of
selected companies in the Southeast Asian countries of Indonesia, Malaysia, Philippines
and Thailand exhibited positive, negative and neutral correlation at various significance
levels. The study was prepared in order to look into the CSR and Financial Performance
relationship among selected companies in the ASEAN countries during a 10-year period
ending 2015. Additionally, the study also provided that regardless of financial situation,
Southeast Asian companies are encouraged to perform well in the environment, social
and governance standards. The areas that this research undertook include ratios of
Return on Assets, Return on Equity, Return on Capital Employed, Gross Margin, Net
Profit Margin, Earnings per Share, Price to Earnings Ratio, Price to Book Value Ratio,
Price to Cash Flow Ratio and Dividends Yield Ratio.
This research is similar to the Querol research in the sense that they both
concentrate on the CSR of enterprises. The only difference is that this study was
conducted locally while the aforesaid dissertation was conducted internationally. An
additional difference of the old one with this study is that it will not be conducted for a
long term. Nonetheless, it is not a controlling element that will make this study
unqualified and inferior. The edge of this study is that it will not only look into the
financial performance of the company but in its overall operation.
46
Querol-Areola, Eunice Mareth (2017). The Relationship of Corporate Social Responsibility and
Financial Performance under Corporate Governance Aspects in Selected Southeast Asian Companies.
School of Management, Economics, Law, Social Sciences and International Affairs, University of St.
Gallen, Switzerland.
A study was conducted by Chen, Chen & Torstensson, Paul (2015)47, which talked
whether or not environmental management systems affects energy efficiency, and
whether or not it could contribute to sustainable development and increase corporate
social responsibility. The previous study shows that the environmental management
system has contributed to CSR practices in supporting the organization with guidelines
toward continuous improvement of environmental impact, increased personal
knowledge and some changes of production equipment. Hence, it lead to the fact that
the company has managed to increase energy efficiency with respect to all energy
sources, except water.
In the study conducted by Chen et al. it emphasized more on the environmental
effects and efficiency in production while this study will include numerous factors. The
similarity of the two studies are on the topic at hand. On the subject, they also have
substantial difference because the previous research studied different companies while
this research will focus on water and electric enterprises. The advantage therefore as
inferred from the dissimilarity mainly on the particularity of the subject to be studied.
Hameed, Syed Kamran (2010)48 conducted a study in Pakistan which intends to
answer the question how do domestic companies and MNC’s (Multi National
Corporation) respectively, view the CSR concept? The study revealed that none of them
have developed a clear target goal to run their social responsibility in their long term
47
Chen, Chen & Torstensson, Paul (2015). Environmental Management System's Impact on Corporate
Social Responsibility: A Case Study of a Multinational Company Operating in China. Karlstads University,
Sweden.
48
Hameed, Syed Kamran (2010). Corporate Social Responsibility (CSR) Theory and Practice in Pakistan.
Department of Economics, Faculty of Natural Resources and Agricultural Sciences, Swedish University of
Agricultural Sciences, Sweden.
strategy. Thereafter, it recommended that CSR should be acknowledged and equipped
with existing contextual realities that favor sustainable practices and ethical concern in
the business.
The research conducted by Hameed is similar to this research because both talks
about the concept of CSR. The difference on the other hand is on the matter of the
subjects. The old research included two groups of subjects, the domestic and MNCs
which includes a wide variety of business enterprises. Compared to this study, it only
focuses on water and electric providers which are generally both inclined in providing of
public needs. The lacking area of the aforesaid research is on the portion of the effects
of CSR on the operation of the businesses. This study will be filling out such gap by
including the various factors on how CSR affects the business operations.
Another study was conducted by Aktüre, Burak & Jaldín, Rossmary (2004) 49 in
which it revealed that the influence of a department vary according to their power
status and CSR departments have low level of influence on strategic decision-making. It
was then concluded that CSR-movement today appears as a business answer to social
conflicts and is in that sense similar to a marketing strategy. Nevertheless, it presents
corporations as responsible and accountable to society in their new role as societies’
rulers but the influence of CSR departments will remain the same unless there are more
profound changes in the organizational perceptions and approaches towards social
49
Aktüre, Burak & Jaldín, Rossmary (2004). Corporate Social Responsibility or Corporate Social
Responsiveness- Case study of CSR in Top Swedish Firms. School of Business, Economics and Law,
Göteborg University, Sweden.
issues. This study was conducted in Sweden over various Swedish corporations generally
to dig deeper into the role of CSR in the said companies.
The difference then of the Aktüre study with this study is on the part of the
accuracy of the subject of study and the focusing on a certain business enterprises
within the same nature. Another difference is on the portion where the old research
studied the internal management of the organization compared to its CSR. This study
will not anymore emphasize the interrelations of the different departments with the
implementation of the CSR activities. The similarity on the other hand is inferred from
the topic and on the role of CSR to the company’s progress. The wanting area of the old
study which is on the manner of concentrating toward a specific business is the area
which our research would like to fill.
In addition to the other studies, a research was also conducted by Stepanenko,
Ievgeniia (2012)50 which discovered that CSR is still a concept waiting to be applied in
Ukraine and that consumers are generally and often unaware and unsupportive towards
CSR. Nonetheless, Ukrainian companies are developing an understanding of strategic
CSR as a competitive advantage in a long-term perspective. The said study was
conducted in Ukraine particularly to make suggestions for positive change in a process of
CSR implementation by Ukrainian companies and a role of state in promoting
responsible business behaviour. The reason for studying such topic is founded on the
belief that there is a need in changes to existing management practice, insuring
integration of principles, methods and tools of social responsibility in business activities
50
Stepanenko, Ievgeniia (2012). Corporate Social Responsibility in Ukraine. Department of Real Estate
and Construction Management, Ukraine.
of Ukrainian corporations in order to ensure their competitiveness, achievement of high
productivity and profitability.
Therefore, both the two studies gaze into the effect of implementing CSR on the
productivity and profitability of the business organization. The only difference to be
noted is on the portion of the futurity of the usage of the research because it is
motivated by the fact that CSR has a great impact on the success of the business while
this study will tackle more on the past happenings. Generally, this study will look into the
things that occurred while CSR activities were being implemented and integrated by the
business into their operations.
Ha, Quyen (2016)51 has also conducted a study which was purposely to discover
corporate social responsibility in oil and gas sector in Finland. The said oil and gas sector
is the Neste Oil Corporation which is a multi-national company that operates in Finland.
The study concluded that the implemented CSR of Neste Oil Corporation is mainly
obtained from the theories of CSR. That means companies get their CSR’s know- how
strengthened and have the strategic plans step- by- step implemented. This also means
that CSR is not a new topic but an accelerating trend, a valuable treasure, and an
integrated part of business operations. It is the involvement of every part of business,
both internal element and external condition. It may also be interpreted in a way that
businesses are obligatory and willing to enthusiastically care and act for their
community’s and ecological system’s long- term wealth beside maximizing the profit
value.
51
Ha, Quyen (2016). Corporate Social Responsibility in Oil and Gas Industry in Finland: Performance of
Neste Oil Corporation. Seinajoki University of Applied Sciences, Faculty of Business & Culture, Finland.
Hence, it may be inferred that the two studies are similar especially on their field
of study and on the nature of the business of their subject. Oil, water and electric
companies are all part of the public service. On the other hand the dissimilarity of the
old research with this research is on the things to be studied which are the facts that
happened and not much on the theories that are used by the company. This study will
not crack the theories on how they implement CSR but on “why are these implemented”
and “what these CSR activities are that effects to company’s success or failure”.
In a study conducted by Raderbauer, Marita (2011) 52, it showed that the general
attitude towards sustainability was very positive for all businesses. It was also discovered
that higher classified, medium size, hotels, and businesses that were part of a corporate
chain took more significant actions when compared to micro size and businesses that
were owner-managed. A high implementation of sustainable business practices
correlated with a high level of benefits perceived, more strategic planning and a less
intense perception of barriers. Thus, the study recommended that the communication
between public and private sector as well as the awareness raising and marketing of
sustainability to consumers need to be improved.
When we talk about the similarity of the two researches, it can be deduced that
they have the same topic presented and aimed at the same goal. Both studies dived into
the effects or interconnection between CSR and business operations. They differ only on
the nature that the business belong to. The old research is more on hotel businesses
while this research is more on water and electric companies that either provides or
52
Raderbauer, Marita (2011). The Importance of Sustainable Business Practices in the Viennese
Accommodation Industry. University of Exeter, Vienna.
distributes such. The wanting or lacking area of the old research therefore is non-
existent. It would be nonsensical to implicate an existing advantage of one research over
the other especially having the same topic but differ only on the subject.
Similarly, Nylander, Rauli (2016) 53 also lead a study on corporations which aimed
to find out what businesses could do to operate responsibly and what kind of benefits
these responsible actions would create for businesses working towards the global
sustainability goals. The study highlighted that Finnish businesses handle their
economic, social and environmental responsibilities well, but that they also have many
areas of improvement, such as deeper integration of corporate social responsibility to
business operations. Additionally, it was also shown that businesses should focus more
on seeking competitive advantage through shared value creation where business,
customers and societies would all benefit from responsible business operations.
The Nylander research is the same with this research because both are tackling
the effects of CSR to different factors in the business operation. The difference to be
noted is on the area of subject. The previous research’s subject include Finnish
corporations while this study focus on the water and electric companies. This area of
difference may be considered as an advantage of this study because it can concentrate
more on studying fewer companies.
53
Nylander, Rauli (2016). Corporate Social Responsibility: Business Benefits From Saving the World.
Turku University of Applied Sciences, Finland.
In a similar study conducted by Runquist, Claire Barnes (2016) 54, it revealed that
CSR in Icelandic companies were more connected to the companies’ core business and
was more in line with global standards. The CSR in the US companies varied greatly
between the companies but was overall less focused on global standards and had a
much more intense focus on the role that government regulation played in making their
business more difficult. The aim of the research is to examine the environmental aspects
of corporate social responsible (CSR) in renewable energy companies and how that
connects to governmental policy in both Iceland and the United States (US).
The two researches are alike because both of them include energy producing and
generating companies along with their CSR and its effects to their operations. The
additional similarity of the two researches is that both studies investigate and aimed to
study only two companies and then comparing them. The difference is that this research
focus on fewer subjects rather than looking at the overall CSR implementations of two
general groups of companies. The difference of the two researches can be considered as
the lacking area of the previous research and an area to be filled by this present
investigation.
Additionally, an inquiry was also made by Brandt, Christian (2011) 55 purposively
to investigate the potential benefits of using of leading indicators in sustainability
reporting as a means to reduce risk in the electric utility sector. It studied Idaho Power,
54
Runquist, Claire Barnes (2016). Corporate Social Responsibility and Renewable Energy Companies: A
Comparison of Practice and Policy in Energy Companies the United States and Iceland. School of Social
Science from the School of Business, University of Iceland, Iceland.
55
Brandt, Christian (2011). Sustainability Reporting in the Electric Utility Sector: Connecting Leading
Reporting Indicators with Risks – Using Idaho Power Company as an Example. Lund, Sweden.
the largest electric utility company in the State of Idaho (USA), which served as an
example to show what set of leading indicators is most suitable to address risks within
their sustainability reporting efforts. Furthermore, the thesis contributes to a better
understanding of the importance and applicability of leading indicators and their
potential role in addressing and mitigating risks of organizations in connection to
sustainability reporting and sustainability performance.
The significant dissimilarity to be noted between the two researches can be
found on the topic being investigated. The previous study which included the leading
indicators as a factor of sustainability will not be studied by this research. This research
will talk more on the connection of CSR to sustainability and other factors of operation.
The similarity is on the subject matter which has both connections to power and energy
supply as a public commodity or good. Hence, this study is advantageous because it will
focus more on the activities of the enterprises as responsible organizations rather than
the leading indicators.
A thesis was presented by Mensah, Victoria (2009)56 which purpose is to explore
and explain Corporate Social Responsibility (CSR) and its impact on the sustainable
development of people living in a gold mining community, Obuasi in the Ashanti region
of Ghana. The research revealed that the company mining the Obuasi mine - AngloGold
Ashanti (AGA) seems to uphold the concept of social responsibility, their willingness and
zeal to ensure the reality of such policies are almost non-existent. Additionally, the
56
Mensah, Victoria (2009). The Role of Corporate Social Responsibility on Sustainable Development: A
Case Study of the Mining Community in the Obuasi Municipality. University of Agder, Kristiansand,
Ghana.
company formulates and implements the policies which are done by the company with
very little consultation with the people and hence affects its operation
It seems that the only similarity of the two theses is on the topic presented. Both
are undertaking the CSR of a certain company and its effects to the business operation of
the organization. The inconsistency on the other hand is on the part of the subject being
studied. The previous one studies a mining company while this one will investigate both
electric and water distributors and suppliers within the locality. The significant
interrelation to be noted is that both companies obtain their resources from the
environment and therefore expected to return something to the environment.
Lastly, a similar research was also conducted by Zhao, Wen (2015) 57 which
concluded that leading energy corporations integrated the traditional focus on
responsibilities linked to economic performance, but they also reflected the role of
corporations as a system of stakeholders operating that emerged in recent years. The
study also uncovered that energy corporations were taking an active role in protecting
employee health and safety. The study further recalls that the CSR activities do not affect
the profitability of the business.
The difference of the Zhao research with this study is more on the presentation
of the ideas and concepts. This thesis will not only focus on the impact of CSR to the
profitability of the business but will look more on the numerous factors that are included
in the operations of the business. The similarity that exist between the two is on the
57
Zhao, Wen (2015). Corporate Social Responsibility in the Energy Industry: A Content Analysis of
Leading Energy Companies' Websites. College of Communication and Information, Florida State
University, Florida USA.
nature of the businesses involved in the investigation. They are both inclined on the
energy and resource companies. The lacking area of the previous research can be seen
on its scope of study. Various variables were not included in the research such as
sustainability, customer satisfaction, environmental impact and others.
Synthesis
Based on the foregoing literature and studies presented, the researchers
conclude that CSR is a new concept in the Philippines and hence a need to study its
implementation and integration in the businesses that operate in the country and its
impact to the success (or failure) of the organization particularly on its operation and
stakeholders.
Chapter 3
RESEARCH METHODOLOGY
In this chapter, a thorough presentation and explanation of the methods to be
used in this study were made. This method includes the design or approach to be used,
the locale or setting of the study, the informants, the instruments and tools to be used
to collect pieces of information, and the analysis of the data.
3.1. Research Design
To be able to study the present situation of the business organizations as subjects

of the study, the researchers selected the descriptive qualitative study research method
or approach. According to Koh, Eunsook & Owen, Willis (2000) 58 a qualitative research
design makes an emphasis on process, or how things happen, and a focus on attitude,
beliefs, and thoughts- how people make sense of their experiences as they interpret
their world. Qualitative research emphasizes inductive reasoning, whereby the
researcher seeks to develop hypotheses from observations. As regards descriptive study,
Ethridge, Don (2004)59 defines it as, simply the attempt to determine, describe or
identify what is. As characterized by Fox, William & Bayat, Mohamed Saheed (2007) 60, it
is aimed at casting light on current issues or problems through a process of data
collection that enables them to describe the situation more completely than was
possible without employing this method.
This study will answer separate set of problems. One of which include the
relationship between the CSR programs and the operation of the business. This will
include the collection of data as regards the CSR programs, barriers that prevent its
implementations, and the motivation of the organization in implementing CSR activities.
The qualitative approach will be used to collect all pieces of information with regards to
this problem. As a qualitative study, the data for this problem will be collected through
series of interviews and through secondary data to be obtained from the respective
organizations.
Another set of problem is a study of inter-relationship between the CSR

58
Koh, Eunsook & Owen, Willis (2000). Introduction to Nutrition and Health Research. Kluwer Academic
Publishers.
59
Ethridge, Don (2004). Research Methodology in Applied Economics. John Wiley & Sons.
60
Fox, William & Bayat, Mohamed Saheed (2007). A Guide to Managing Research. Juta Publications.
programs and the stakeholders of the organization. The qualitative approach will also be
used to collect data and as such, the pieces of information will be collected through
conducting focused-group discussions. Separate focused-group discussions will be
conducted for the employees and personnel, for consumers and for the community
representatives.
3.2. Locale of the Study
This study will be conducted in Tuguegarao City, Philippines. The setting is the
same place where CAGELCO 1 and MTWD distribute and supply electricity and water
respectively. Majority of the interviews and focused-group discussions will be conducted
in Tuguegarao City where the place of business of MTWD is found and where most of
the employees are located. In the coverage area of CAGELCO, Tuguegarao City was
chosen as the place where this study would be conducted. The consumers or customers
of CAGELCO in Tuguegarao City would become the informants. Due to the very large
geographical coverage where CAGELCO operates, the capital of the province was chosen
to become the focal point of study. The reason is to have a uniform or the same area of
study with that of MTWD and to enable the researchers to compare the programs of the
two organizations. The other coverage areas of CAGELCO and MTWD would be set aside
because the other municipalities where the two public utilities operate are not the
same. The common municipality where they operate are Solana, Piat and Tuguegarao
but the latter would be chosen because the two other municipalities are not easily
accessible for the researchers.

3.3. Informants of the Study
The informants of this study were grouped according to the form of data needed
to be collected.
3.3.1. Informants for CSR and its Effects to the Company Operation
For the collection of pieces of information regarding the CSR programs, the
motivation of the organization and the barriers in implementing the CSR programs, and
its effects to the operation of the business, it will be obtained from the middle and top
level management of the company as determined from their organizational structure.
The top and middle management levels were chosen because these are where the
majority of the members of the two organizations who have substantial and necessary
idea and knowledge are found and designated.
3.3.2. Informants for Employee Motivation and Retention
The data concerning the relationship of CSR and employee motivation and
retention will be acquired from the employees and personnel of CAGELCO and MTWD.
The focused-group discussions to be conducted would be composed of eight (8) to ten
(10) members. The employees and personnel are chosen because it would be biased if
the information would be coming from the management itself. As a qualitative study, the
insights of the employees are far better than the opinion of the organization itself.
3.3.3. Informants for Consumer Satisfaction and Community Advancement

In connection to the relation of CSR with consumer satisfaction and community
advancement, the informants will be from the community where the two public utilities
operate and conduct their businesses. These informants are generally from the same
geographical area, which is Tuguegarao City. The focused-group discussions would also
be composed of 8-10 members. The same reason justifies why the consumers
themselves should be the one to give their perceptions regarding their satisfaction as
consumers and advancement as members of the community. The consumers can better
determine whether or not they are satisfied or not compared to the personal insights of
the two public utilities.
The employees, consumers and community representatives will be chosen
randomly and the sampling method to be used will be the purposive random sampling
technique. Due to the very large total population of the informants of the study, the
researchers find this method appropriate and the most applicable.
3.4. Research Instrument
To collect the data needed for the CSR programs and its effects to the operation
of the business, the research instrument to be used will be a structured interview guide.
The interview guide for the management of CAGELCO 1 and MTWD will be based from
the statement of the problem. The interviews to be conducted will be audio-recorded
and further transcribed. To ensure the integrity and credibility of the transcription, the
researchers will let the individuals who will be interviewed, to verify and attest that the
content of the transcription were true and correct according to their personal
knowledge.
A script or moderator guide was also formulated to guide the researchers in
conducting the focused-group discussions for the employees, consumers and the
community representatives. The focused-group discussions will be audio-recorded and
important details will be noted and written down at the same time.
As regards to the access and contact with the informants, the researchers will
send letters to proper authorities and individuals to allow the conducting of the
interviews and focused-group discussions.
In all interviews and focused-group discussions, the informants will be required
to fill up a consent form to obtain their approval and attest that they participated with
their own will and volition. Any person who may feel uncomfortable may withdraw from
the interview or discussion and may cease to be a part of the activity. All information
and data acquired and obtained will be used solely for research and study purposes.
3.5. Analysis of Data
The collected data will be presented based on the order of the statement of the
problem. An in depth analysis will be made to present the information based on the
transcript of interviews and the focused-group discussions. The differences and
similarities between the two business organizations regarding the types of CSR programs
they implemented will be discussed. A discussion of the general insights of the
employees as well as the customers and community representatives will also be made.
The discussion will start from the various CSR programs implemented by the two
public utilities and what prompted them to implement their CSR activities base on
existing theories. The middle part would contain the discussions regarding the
constraints that prevent the implementation of CSR programs. On the latter part of the
discussion, the effects of CSR to the operation of business, the consumers’ satisfaction
and the perception of the members of the community regarding their advancement will
be included. Finally, identification of possible solutions and recommendations on how to
resolve the failure to implement CSR programs and other possible measures will be
discussed.

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CAGAYAN STATE UNIVERSITY- ANDREWS CAMPUS PAGE 1

1.1. Background of the Study

the practice of volunteerism as a strategy in order to attain national development and

international understanding. This law is also binding to every business organization in

consonance with their respective “Corporate Social Responsibility” (CSR).

CSR, according to various authors, refers to the voluntary activities integrated in

without compelling them to do such activity. It is more of a discretionary deed on the

topic is still needed to be studied and identified.

According to a study conducted by Chen, Chen & Torstensson, Paul (2015) it

“environmental management system” acts as a means for social responsibility by

was more efficient with the advent of their social responsibility.

A study conducted by Maximiano, Jose Mario (2005), here in the Philippines,

environment. Among the various areas of corporate social responsibility, workplace

concerns is most addressed. These involve activities such as compensating employees

and development opportunities to employees. The companies’ integration of the CSR to

The distributors of renewable energy in the city of Tuguegarao, especially the

programs by corporate sectors in the community.

other stakeholders that these companies have in particular.

1.2. Statement of the Problem

Generally, this study aims to present the Corporate Social Responsibility

programs implemented by CAGELCO 1 and MTWD.

Specifically, this study seeks to answer the following questions:

1. What are the Corporate Social Responsibility programs implemented by CAGELCO 1

and MTWD in terms of:

Social Responsibility programs and activities?

Corporate Social Responsibility programs by CAGELCO 1 and MTWD?

operation in terms of:

stakeholders in terms of:

1.4. Conceptual Framework

Based on existing concepts presented and disputed by various and numerous

be considered as the paradigm or model to be followed particularly in determining the

CSR Programs  Compliance to  Identify possible

FIGURE 1. Paradigm of the Study

community partnership, environmental stewardship and managing workplace concerns.

involved and entangled in this investigation.

The process includes compliance of the businesses to RA 9418 (otherwise known

finally, the actual implementation of CSR activities.

the operations of the businesses. This include profitability, sustainable development,

image and reputation, environmental improvement and advancement, conflict

the second is composed of customer satisfaction, employee motivation and retention

obstacles that prevent or impede the actual implementation of CSR programs.

1.5. Significance of the Study

and organizations. The following are the stakeholders of this study:

The Cagayan 1 Electric Cooperative, Inc. and Metropolitan Tuguegarao Water

of their CSR programs.

The Government, particularly through the Energy Regulatory Commission and

of memorandum circulars and other protocols on how to regulate public utilities

with other governmental agencies.

other members of the community to spread awareness to everyone.

advancement, improvement and as a means of assistance to the indigent members of

the community and the community as a whole.

among various CSR programs being presented.

to their review of related literature and studies.

1.6. Scope and Limitation of the Study

residents of Tuguegarao as informants of the study on the matter of their personal

development of the community in general. Furthermore, this study is only limited to a

business, competitors cannot be included in the list of stakeholders that may be

informants to a certain point.

1.7. Definition of Terms