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This is an Open Access article, distributed under the terms 
of the Creative Commons Attribution CC BY 4.0

1 Kharkiv National University of Radio Electronics, Ukraine (corresponding author)
E-mail: sergii.stepanenko@nure.ua
ORCID: https://orcid.org/0000-0002-6132-328X
2 Simon Kuznets Kharkiv National University of Economics, Ukraine
E-mail: hneunemashkalo@gmail.com
ORCID: https://orcid.org/0000-0002-8614-750X
3 National Technical University "Kharkiv Politechnic Institute", Ukraine
E-mail: l.salionovych@gmail.com
ORCID: https://orcid.org/0000-0001-9005-9273

DOI: https://doi.org/10.30525/2256-0742/2023-9-5-252-260

TOOLKIT FOR SOCIAL RESPONSIBILITY  
OF BUSINESS IN THE SYSTEM OF INCLUSIVE CORPORATE 

MANAGEMENT OF SUSTAINABLE DEVELOPMENT  
OF UKRAINIAN AGRICULTURAL COMPANIES

Sergii Stepanenko1, Karina Nemashkalo2, Liudmyla Salionovych3

Abstract. The research subject is the social responsibility of agribusinesses in the context of current corporate 
governance practices. Methodology. The study uses the following methods of economic research: content  
analysis method (when processing scientific sources and reviewing thematic literature); abstract and logical  
method (when substantiating the defining principles and criteria of social responsibility of business entities 
in the agricultural sector); statistical observations and economical and statistical calculations (when analysing  
indicators of the achieved state of social responsibility of agricultural companies); abstract and logical method 
(when substantiating conclusions to the study). The research is aimed at finding tools to increase the social 
responsibility of agrarian business through the transformation of the corporate culture of agricultural 
management of Ukrainian companies. Conclusion. Ukraine has a strong agricultural potential. However,  
achieving national and global sustainable development goals, which are relevant shortly, requires a change in  
business values and strategic guidelines. Such values should be aimed at solving the problems of protecting  
the environment, preserving natural resources, improving the quality and safety of agri-food products, and  
improving the quality of life of the rural population. The solution to these problems is inextricably linked to  
voluntary, socially responsible agribusiness initiatives. The analysis carried out showed that there is a high level 
of agribusiness social responsibility in the management of the activities of large-scale agricultural enterprises 
in Ukraine, which is reflected in the voluntary non-financial reports. In small- and medium-sized agribusinesses, 
the perception of the need for social responsibility is limited and constrained by a lack of financial resources.  
The calculated indicators show a low level of social responsibility in the agricultural business of small- and  
medium-sized agricultural enterprises in Ukraine. The level of chemicalisation of agricultural production and 
ploughing of agricultural land is high. There are significant problems with the use of rural labour resources and 
the development of rural areas. The main problems were identified in the spectrum of irrational use of land 
and labour resources and the low quality of life of the population in rural areas of Ukraine. The processes of  
recognition of the values and benefits of socially responsible agribusiness in Ukraine are slow. As a tool for  
increasing the social responsibility of agribusinesses in Ukraine, a system of principles and criteria of socially 
responsible business is proposed for implementation in the corporate governance of Ukrainian agribusinesses.

Key words: agricultural business, inclusive agricultural management, Ukrainian agricultural companies, social 
responsibility, corporate culture, sustainable development.

JEL Classification: Q10, M14

1. Introduction
Ukraine has enormous potential for agricultural 

production that can ensure food security for the 

Ukrainian nation and EU countries. Despite the 
protracted military conflict in the country, now in 
its second year, agriculture, unlike other sectors of 



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the national economy, demonstrates a high degree of 
sustainability and adaptability to challenging business 
conditions. At the same time, Ukraine's accession 
to global and European sustainable development 
initiatives places radically new demands and priorities 
on the further functioning of the agricultural sector 
and mechanisms for creating agri-food chains. The 
margin of safety and stability of Ukrainian agriculture 
today is determined by a high level of intensification 
of production, which, together with low short-term 
competitive advantages, constitutes strategic risks 
and threats to the sustainable development of the 
agricultural sector from a strategic perspective. In 
the global agri-food market, products created on the 
basis of the principles of sustainable development,  
corporate social responsibility and inclusive corporate 
governance practices are becoming increasingly  
popular. The result of the implementation of these 
principles is the production of environmentally  
friendly, safe agri-food products that meet the needs 
of consumers on the basis of quality parameters and 
the achieved balance between the interests of agri-
business owners, buyers, society and the environment. 
Taking into account the needs of future generations 
while meeting the needs of present generations 
is one of the critical criteria of the concept of 
sustainable development, the level of value perception  
determined by the corporate culture of agricultural 
management and the level of social responsibility  
of agricultural business.

2. Literature Review
Corporate social responsibility is already a relatively 

familiar concept of corporate governance, which, in 
addition to the interests of business owners, considers 
a wide range of interests and needs of a whole range  
of stakeholders. According to a survey conducted  
by 77.4% of employees of agricultural companies,  
the concept of corporate social responsibility in 
agribusiness is an important and a priority for  
further management (Ortega, et al., 2016)

In a broad sense, corporate social responsibility 
manifests itself in four main areas: economic 
responsibility, environmental responsibility, 
philanthropic responsibility and ethical responsibility. 
The Growing Importance Of Social Responsibility 
In Business defines corporate social responsibility 
as a company's responsibility to achieve long-term 
goals for customers and a way to benefit society 
(The Growing Importance of Social Responsibility In 
Business).

Hohnen interprets agribusiness social responsibility 
as the implementation of socially beneficial social, 
environmental and economic initiatives in the  
corporate culture and development strategies of 
agribusinesses (Hohnen, 2007). 

Mijatović M. et al. (2021) see the creation of equal 
conditions for the full provision of healthy food for 
the population as the main goal of corporate social 
responsibility and explore the corporate social 
responsibility of agricultural companies through the 
prism of sustainable development goals: preserving  
the environment and combating climate change. 

Climate change and the adaptation of agriculture 
to its trends are key issues and challenges of 
modern inclusive management, one of the tools 
of which is social responsibility of business  
(Xiao-San Luo, et al., 2017).

The defined directions of corporate social 
responsibility of agricultural companies represent 
a rather complex and broad area of agricultural 
management, which is voluntary and quite costly  
from the point of view of financial security. In 
this regard, there is an active scientific discussion 
about the impact of the level of corporate social  
responsibility of companies on their results and 
capitalisation of the company value. Today, most 
of the world-famous companies demonstrate their 
commitment to corporate social responsibility and 
the results of social value creation (Ferrell, Hao, & 
Renneboog, 2016; Kavun, Guryanova, & Zhosan, 2015).

Their research shows that corporate social 
responsibility has a clear financial impact in the form  
of an increase in the market value of the assets of 
companies that demonstrate a commitment to social 
values and needs. McWilliams & Siegel (2000)  
provide evidence that the impact of corporate 
social responsibility policies, as reflected in 
corporate reporting, is directly related to the level of 
investment attractiveness and return on investment. 
Complementing this methodological approach to 
the impact of the level of social responsibility of  
agribusiness on the performance of agricultural 
companies, Madhu (2022) notes that the practice of 
implementing socially responsible initiatives reduces  
the risk of the organisation agribusiness, provides 
bonuses from opportunities to enjoy tax benefits and 
provides long-term competitive advantages. Similar 
results are demonstrated by the social responsibility 
practices of Ukrainian agricultural holdings 
(Zamlynskyi, et al., 2023).

The exclusivity and relevance of the practical  
aspects of socially responsible agribusiness has 
led to considerable interest among researchers in  
indicators to assess its actual level and effectiveness. 
Briamonte & Giuca (2016) propose as main  
indicators the use of resources (savings), the cost of 
implementing socio-economic and environmental 
initiatives for agribusinesses, the cost of human  
resources development and the creation of safe 
working conditions. Faizrakhmanov et al. (2019)  
the set of indicators is systematised into three groups: 
the level of innovation activity (the share of research 



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and development costs, the share of innovative 
products), economic indicators (GDP, sales, profit), 
indicators of environmental protection (expenditure 
on eco-measures, biodiversity conservation, invest-
ment in fixed assets). Mills et al. (2021), when 
assessing the level of social responsibility of  
agribusiness, focused on the social component using 
indicators of social and environmental sustainability 
of business structures: farmers' awareness of ecological 
problems of the territory, interest in landscape assets, 
level of ecological knowledge, degree of readiness 
of personnel to implement the tasks of responsible 
agribusiness, self-identification of employees, level  
of knowledge and qualifications. 

In their research, Martos-Pedrero et al. (2022) 
use a comprehensive model based on the following 
factors: the potential capacity of agribusinesses for 
social responsibility and the level of its understanding 
and perception, the degree of awareness of the role 
of ethics in agribusiness, image and reputation,  
financial performance, and the organisational and  
legal form of agribusinesses. Biró et al. (2021) assess  
the corporate social responsibility of agricultural 
business through a system of social and environmental 
reporting indicators, the main of which is the level 
of adaptation of farms to environmental, social and 
economic changes brought about by the concept of 
sustainable development (increasing the share of 
eco-products and services, conservation of natural  
resources, reduction of CO2 emissions, share of 
renewable energy sources, and so forth). The principles 
and foundations of sustainable development are  
studied by Ukrainian scientists when formulating 
strategies for regional development and economic 
recovery (Kramarenko, et al., 2022; Pryshchepa, 
Kardash, Yakymchuk, et al., 2020).

Ukrainian scientists prefer indicators of  
efficiency of resource use in the context of imple-
mentation of measures of corporate social respon- 
sibility and indicators of the state of development 
of organic farming in the context of modern  
transformations of European integration (Lopatynskyi,  
et al., 2023). 

Scientists agree that the social responsibility 
of agribusinesses is voluntary and proactive, and 
is determined by the level of understanding and 
perception of social values by management and  
business owners. At the same time, in recent years  
there has been a significant number of recommen-
dations and standards that regulate the level of  
social responsibility of agribusinesses and orient  
their main directions and actions. In today's 
environment, the main rules of corporate social 
responsibility that have already acquired the status  
of international standards include the following:  
Global Reporting Initiative (GRI), ISO Group 
standards, Account Ability, Occupational Health 

and Safety Assessment Series (OHSAS), Corporate 
Responsibility Audit, national standards that have 
transcended national borders – Sunshine, Keidanren, 
Sullivan social standards and others. 

Modern ways of organising and managing agri-
food businesses based on sustainable development 
are actively shaping new initiatives and regulations 
that help agri-food businesses to increase the level 
of sustainability, such as Responsible Agricultural  
Supply Chains, recommendations from the FAO 
and other world organisations, such as the Voluntary 
Guidelines on the Responsible Governance of  
Tenure of Land, Fisheries and Forests. 

Ukrainian scientists are also actively researching 
the processes of using agribusiness corporate 
social responsibility tools. Yermakov O. Y. and 
Nahornyi  V. V. (2021) propose a mechanism of 
corporate social responsibility of agricultural 
enterprises, including goals, motives, corporate  
social responsibility programmes, behavioural 
characteristics of the main stakeholders and  
expected results. Among the main areas of corporate 
social responsibility of Ukrainian agricultural 
enterprises, the scientists distinguish financial  
activities, social and environmental areas, and  
domestic and foreign economic directions (depending 
on the interests of the main stakeholders of  
agricultural formation). Soloviova O. et al. (2022), 
Zinchuk T. O., Levkivskyi Ye. V. (2019) consider 
corporate social responsibility of agricultural  
business to be a promising innovative tool for  
sustainable agricultural development, giving top  
priority to the ISO system (Chernoivanova, et al., 
2021). The result of the implementation of such a  
tool is the highly profitable activity of agribusinesses 
and, at the same time, voluntary non-profit  
initiatives in the spectrum of socio-economic and 
environmental changes that are important for society. 

Innovative programmes and projects for the 
sustainable development of agricultural business  
have both direct and indirect impact on closing the 
inclusive gaps that exist today in rural development.  
The main ones are:
– Income imbalance between urban and rural areas;
– the state of social protection in rural areas;
– opportunities for the rural population to exercise their 
social and political rights;
– gender equality;
– access to resources for residents.

The purpose of the article. The purpose of the  
publication is to find tools for increasing the social 
responsibility of agrarian business through the 
transformation of the inclusive corporate culture of 
agricultural management of Ukrainian companies  
based on an assessment of its current level and 
identification of current trends in the development  
of the agricultural sector of Ukraine. 



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The main objectives of the study are as follows:
1. To identify the main problematic aspects that  

hinder the development of social responsibility of 
agricultural business in Ukraine.

2. To justify the tools of inclusive socially responsible 
agricultural governance (principle and criteria).

3. To assess the actual level of social responsibility  
of Ukrainian agricultural companies.

Methods. The article uses general scientific and 
specific economic research methods. The review of 
literature and study of the theoretical essence of the 
selected research problem was carried out using the 
content analysis of sources covered in scientometric 
databases, in particular, Scopus and Web of Science.  
The official websites of large Ukrainian agricultural 
holdings were also used as primary sources of case 
studies, where non-financial (social and environ-
mental) reporting is available.

Using the methods of induction and deduction, 
the choice of the research topic is substantiated, its  
purpose and main objectives are formulated. The 
abstract and logical method is used to substantiate  
the basic principles and criteria of social responsibility  
of business entities in the agricultural sector. The 
method of statistical observations and economic and 
statistical calculations is the basis for analysing the 
indicators of the achieved state of social responsibility 
of Ukrainian agricultural companies. The information 
database also included data from the State Statistics 
Service of Ukraine. When calculating the level of 
social responsibility of agricultural companies, large 
agricultural holdings were excluded from the total 
number of all Ukrainian enterprises. The study was 
conducted at agricultural enterprises of large and  
small sizes. The conclusions of the study are based  
on the abstract and logical method.

3. The Main Research Material
The transformation to the concept of 

sustainable development, which is gradually being  
implemented in the practical activities of  
Ukrainian agricultural enterprises using the tools 
for increasing the level of social responsibility of  
agricultural business, is a complex and lengthy 
process mediated by several factors. The main factors 
determining the degree of success of socio-economic 
and environmental transformations in agriculture in 
modern conditions are the level of corporate culture 
and existing drivers of agricultural management. In 
Ukraine, the level of corporate social responsibility 
largely depends on the nature of the perception of  
social responsibility values by the owners, managers  
and employees of agricultural enterprises. A deep 
perception of the values of social responsibility of 
business by its founders is today a decisive factor 
in the philosophy of development of agricultural 

enterprises and the justification of strategies for  
their implementation.

The social responsibility of agribusinesses 
is a strategic competitive advantage, the most  
important of which are the quality, environmental 
friendliness and safety of agri-food products, 
building the intellectual capital of agribusinesses, the  
powerful potential of agro-branding and the  
possibility of maximising the value of agribusinesses, 
increasing the ratings of investment attractiveness, 
winning the favour of consumers (buyers),  
stakeholders and strengthening competitive positions 
in the agri-food market. These long-term advantages 
have a precise mechanism for translating into  
specific economic rewards, which are expressed 
through the final performance indicators of the 
activities of the business structures. At the same time, 
these strategic advantages are currently limited by  
the significant influence of two key factors: the  
time factor and the available financial potential of 
agricultural companies. The unstable conditions of 
economic life in Ukraine, complicated by the results 
and consequences of the military conflict, result in 
the dominance of short-term interests of agribusiness 
owners and the priority implementation of short- 
term business goals, the main priority of which is  
the commercial priority of profitability. In addition,  
the limited financial capacity of the majority of  
small- and medium-sized agricultural enterprises in 
Ukraine does not contribute to the implementation 
of long-term goals, especially those that require 
significant amounts of investment and financial 
resources. Corporate social responsibility  
instruments require substantial financial 
resources, which manifest themselves as long-term 
investments and have a strong impact after a (often 
significant) period of time. This increases the risk of  
agribusiness, especially in the current political 
and socio-economic crisis in society. Today, these  
limitations are the main obstacles to the active 
development of corporate social responsibility in  
the agricultural sector. 

Despite the existing barriers, the practice of  
socially responsible agriculture in Ukraine continues  
to strengthen and spread among agricultural  
enterprises. To provide institutional support for 
the development of corporate social responsibility 
in Ukraine, the national expert organisation CSR  
Ukraine (Create Sustainable Result) was established 
15 years later as a partner of CSR Europe and the  
World Business Council for Sustainable Development.  
The main purpose of the national organisation is to 
promote socially responsible initiatives and business 
principles in the practice of Ukrainian companies. 
According to the analytical data of the organisation,  
the largest share of socially responsible business 
initiatives in Ukraine is implemented in large 



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enterprises – 67%, about 18% of all initiatives take 
place in companies with international activities,  
13% of socially responsible enterprises in the  
country are transnational companies, and 2% are  
small business entities. Compared to other sectors  
of the national economy, the share of agricultural 
enterprises that are members of CSR Ukraine is 
as follows: large agricultural enterprises – 12%,  
agricultural enterprises engaged in foreign economic 
activity – 14%, and transnational agricultural 
corporations – about 13%. At the same time,  
agriculture is the leading sector in terms of the  
share of business entities participating in CSR  
Ukraine. Among other types of economic activity, 
a significant share falls on the business structures  
of trade and production of consumer goods  
(CSR. Ukraine).

The results indicate a growing understanding  
of the need for social responsibility in the corporate 
structures of the agricultural sector. At the same time, 
the size of agricultural enterprises and the level of 
organisational culture of agricultural management  
and corporate governance practices remain a  
significant problem in the implementation of 
programmes and projects of corporate social 
responsibility in the agricultural sector. The leaders  
of socially responsible business in Ukrainian  
agriculture today are large agricultural enterprises 
with solid financial potential and a high level of 
corporate philosophy of agricultural management. 
According to the Ukrainian branch of Forbes,  
the list of the top 20 largest agricultural companies 
in Ukraine includes Astarta-Kyiv, Eridon, Cardill, 
Viterra, Kernel, Nibulon, LNZ, Delta Wilmar, MHP, 
Ukrlandfarming, Agroprosperis (NCH), Epicenter-
Agro, HarvEast, Agroton, and others (20 largest 
companies in the Ukrainian agricultural sector).

The results of the research showed that almost 
all large-scale agricultural enterprises in Ukraine 
have straightforward corporate social responsibility 
programmes and projects and report annually 
on the results achieved, even though social and  
environmental reporting is not mandatory in  
Ukraine. These enterprises have strategic goals that  
are closely related to the goals of the global and  
national sustainable development approach. 
Familiarisation with the voluntary social reporting 
of Ukrainian agricultural enterprises showed 
that the main areas of implementation of socially 
responsible agricultural business projects are  
personnel development and improvement of socio-
economic working conditions (about 75% of all 
programmes), environmental protection programmes, 
public charity projects and assistance to participants 
in military conflicts, cooperation with local,  
territorial rural communities. Each of the social 
responsibility projects of these agriholdings has  

a clear target focus and defined criteria for their  
successful implementation. The following are among 
the most financially large-scale social responsibility 
programmes of agricultural businesses: "Green 
Office", "Sustainable Agriculture", "Health of Rural 
Communities" (Kernel), "Cultural Heritage", 
"Community Well-being", "Village Doctor" (MHP),  
"IT Education", "Clean Environment", "Human 
Pedagogy" (Astarta) and others. These programmes 
help to improve mutual understanding between 
stakeholders, buyers and consumers of agricultural 
products, enhance their image and increase the  
well-being of the population in rural areas.

At the same time, the practice of implementing  
such socially responsible projects and programmes  
for the future sustainable development of agriculture 
and rural areas is limited by the relatively small  
number of large agricultural business entities in  
Ukraine. According to the State Statistics Service 
of Ukraine, there are 46108 agricultural enterprises  
that are classified as small enterprises according to  
the size criteria (which is 86.5% of the total number  
of agricultural enterprises) (The number of active 
economic entities by types of economic activity with 
distribution by the number of employed workers 
in 2016–2022). These agricultural formations have  
much less potential for financial support to 
implement socially responsible business development  
programmes. As a rule, the values of sustainable 
development are not fully reflected in business 
management. The main priority and goal of the 
majority of medium and small agricultural structures  
in Ukraine is the short-term maximisation of  
profits and the fullest possible satisfaction of the  
interests of the owners of agricultural enterprises,  
who often do not take into account the socially 
significant needs of the rural population, the 
environment, present and future generations. This 
leads to excessive commercialisation of agriculture, 
which often has a negative impact on the personnel 
of agricultural structures, the population and the 
development of rural areas, biodiversity and natural 
resources of the agricultural sector. Accordingly,  
this affects the social responsibility indicators of  
modern Ukrainian agricultural enterprises.

It is timely and necessary to improve the philosophy 
of agribusiness management and enhance the 
organisational corporate culture of agribusinesses 
to overcome these problematic aspects in the  
agribusiness management system. One of the tools 
for improving corporate culture is to understand and 
accept the values and benefits of social responsibility 
for the agricultural industry and society. In practice, 
this can be ensured by implementing the principles 
of socially responsible business in the philosophy 
of management of agricultural structures and taking  
into account its criteria in the course of economic  



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activity. Among the main principles of socially 
responsible agricultural business, it would be 
appropriate to suggest the following:
– Transparency principle of management and  
reporting;
– inclusivity, equality, and equity;
– unity principle of goals and balance of interests of 
agribusiness, stakeholders and society;
– compliance with the norms and standards governing 
social responsibility in the agricultural sector;
– the principle of greening agricultural production, 
preserving and restoring the natural agricultural 
potential;
– the principle of ethics in business and management;
– the principle of efficiency and synergy. 

The implementation and observance of these 
principles in economic activity will bring together the 
interests of all participants in the public agricultural 
process into a single system, which will create the 
conditions for obtaining benefits and rewards for 
all parties. In addition, the implementation of the  
principles of corporate social responsibility in the 
corporate philosophy requires a revision of the  
essential criteria for doing business. This set of  
criteria should correlate with the priorities of  
sustainable development in agriculture and rural areas 
and should become a decisive factor in the future 
management of agriculture (Figure 1).

Improving the instruments of social responsibility of 
agrarian business requires defining a methodological 

framework for assessing efficiency and progress. 
Agricultural business is a complex type of economic 
activity, the effectiveness of which is mediated by  
a small number of specific factors and conditions.  
This makes the system of indicators and measures  
of the level of social responsibility in the activities 
of agricultural companies more complex. In the 
scientific literature, there are several methodological 
approaches to assess the current state of social 
responsibility of agribusiness. A systematic review of 
the scientific literature allowed to identify a number 
of leading indicators for assessing the level of social 
responsibility achieved by agribusiness. Among 
the leading indicators offered by scientists, the 
most important are the efficiency of agricultural 
activities, staff turnover, the level of remuneration of  
agribusiness personnel, the tax responsibility of 
agribusinesses and the amount of socially responsible 
investments. Based on such indicators, an integral  
index of the level of social responsibility of  
agribusinesses can be proposed. 

Indicators are often systematised according to 
the main areas of such activities or the primary  
stakeholder context. Fully agreeing with this 
methodological approach, it appears practical to  
conduct an analytical assessment of the actual level 
of social responsibility of Ukrainian agricultural 
enterprises in terms of critical indicators that  
indicate the state of use of natural resources, social 
capital and current policy of agricultural producers  

Criteria for social responsibility of agricultural business

Ensuring conditions for staff development, respect for human rights 
and maximisation of intellectual capital

Creation of opportunities to bridge the inclusive gap between urban and rural areas

Formation of preconditions for sustainable development 
of the agricultural sector and rural areas

Safety of agricultural production, food and national health

Preservation of natural resource agricultural potential for future generations

Active influence on the consumer behaviour of the population and promotion 
of the welfare of the country's population

Efficiency of agricultural business at a level sufficient to provide a financial basis 
for implementing socially responsible programmes

Contributing to the achievement of the SDGs for agriculture and rural development

Figure 1. Criteria for the feasibility of social responsibility of agricultural business

Source: developed by the authors



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to preserve the resources of the agricultural sector  
and rural areas (Table 1). 

According to the analysis, in general, the level 
of social responsibility of Ukrainian agricultural 
enterprises should be higher (except for the activities 
of extensive agricultural enterprises). The main 
problems of agricultural production are concentrated 
in the irresponsible use of land resources, excessive 
use of chemicals (88% of the total cultivated area)  
and the highest level of ploughing of agricultural  
land in Europe – 79.6%. Over the past few decades, 
this has led to a loss of fertility in Ukrainian soils,  
with virtually no possibility of restoring it in the  
short term. This is also due to the severe loss of 
biodiversity, which has declined by 90% in the last 
twenty years, and has minimised the potential for  
organic fertilisation. Today, the profitability of 
most Ukrainian farms is achieved through a high 
level of production intensification based on the use 
of chemicals. At the time, the trend towards the 
greening of farms and the transition to organic and 
environmentally neutral agriculture and livestock 
farming was spreading worldwide. The main obstacles 
to these processes in Ukraine are high risks, lack of 
financial resources and the priority of short-term 
profitability of agribusiness. A difficult situation in 
agriculture is also observed in the social component of 
agribusiness responsibility. The level of remuneration  
of employees in Ukrainian agribusinesses has 
traditionally been much lower than in other sectors  
of the economy. In addition, the gap between the  
level and quality of life of the rural population and 
the urban population has increased significantly in 
recent years. Solving these problems, which are of  
vital importance to the national economy and the 
country's agricultural sector, requires a systematic 

approach and the support of institutional state 
authorities, local governments, rural communities 
and municipalities. However, the difficult socio-
economic situation in Ukraine significantly limits  
the financial potential of state and local authorities. 
In such conditions, one of the main ways to solve  
the existing problems of the agricultural sector and 
rural areas can be to voluntarily increase the level of 
social responsibility of agricultural enterprises and  
the principles of sustainable development. 

Despite the duration of the military conflict on 
the territory of Ukraine, the domestic agricultural  
sector shows a high degree of sustainability and  
strength, which is reflected in the final financial 
performance indicators. The share of profitable 
agricultural enterprises in agriculture is 79%. Thus,  
the level of profitability of operating activities of 
agricultural enterprises (excluding agricultural 
holdings) in 2022 is 21%, and the level of profitability 
of all activities is 14.1% (Agriculture of Ukraine, 
2022). According to the authors' calculations, 
agricultural enterprises received an average net profit 
of about 298.1 thousand UAH per 100 hectares of 
agricultural land. A significant trend in the current 
state of agricultural development in the country is  
the preservation of profitability trends. Despite the 
serious consequences of the protracted military 
conflict, the efficiency indicators of agricultural 
enterprises have lost no more than 10-13% of their 
pre-war values. Domestic agriculture has such  
a margin of safety with a relatively low level of  
aggregate social responsibility of agricultural  
enterprises and the dominance of financial interests  
of their owners in management processes. The  
authors are inclined to their hypothesis that the  
potential for efficiency and sustainability of  

Table 1 
Indicators of the level of social responsibility of agricultural companies in Ukraine 
(except for agricultural holdings)

Indicators 2000 2010 2015 2018 2020 2021 2022
Percentage of ploughed agricultural land, % 77,8 78,1 78,4 79,1 79,5 79,6 79,6
Share of fertilised area, % 56,0 70,0 81,0 91,0 93,0 92,0 88,0
Amount of mineral fertiliser applied per 1 ha, kg 60 84 98 134 152 154 144
Area treated with pesticides, % 28,5 37,7 42,6 89,5 91,4 92,0 89,0
Share of agricultural land under organic production, % - 0,4 1,0 0,7 1,0 0,6 0,6
Biodiversity conservation, thousand heads 9423,7 4494,4 3750,3 3332,9 2874,0 1003,4 942,1
Carbon dioxide emissions, million tonnes 152,0 193,2 161,1 150,5 135,3 141,2 139,3
Share of water used for production needs in agriculture, % 23,6 26,4 20,3 24,5 24,0 41,0 38,1
Capital investments, million UAH 15692,2 11062,6 30154,7 66104,1 50679,7 69950,3 51439,5
Grain yield, centners per hectare 18,3 27,6 43,8 52,2 46,1 59,3 50,3
Monthly salary of employees in the industry, UAH 114,0 1472 3309 7557 9734 12287 13061
including as a % of the economy average 49,5 63,9 74,8 80,8 84,0 87,7 88,0
Number of employees in the industry, % 11,2 9,0 9,6 8,4 7,9 8,0 8,0
Relative poverty rate in rural areas (by expenditure), % - 24,1 27,9 31,6 43,8 44,1 44,4

Source: calculated by the authors based on data from (Agriculture of Ukraine, 2022)



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Ukrainian agriculture and rural areas has significant 
opportunities to increase with active transformations 
of the agricultural management system towards the 
perception and implementation in practice of the 
principles of socially responsible business and the  
values of sustainable development of the 
agricultural sector. Achieving this should begin with 
a deep perception of these strategic values by each  
participant in the agro-production process and,  
most importantly, an understanding of the long- 
term benefits to agribusiness owners in Ukraine. 

4. Conclusions
Agriculture is the main sector of Ukraine's  

economy, which in the second year of the military 
conflict demonstrates a relatively high level of  
stability and dynamic development. In today's 
environment, agriculture in developed countries 
is moving towards a transformational model of 
sustainable development, one of the tools of which  
is the social responsibility of agricultural business. 
Social responsibility of business is already a  
requirement of time, consumers and society. 
Implementation of its principles in the practical 
activities of agricultural companies requires a change 
in management priorities, perception of key results, 
and a change in the philosophy of agricultural 
companies towards a higher degree of inclusiveness. 
In Ukraine, these processes are relatively slow and  
are constrained by the low level of corporate  
governance and insufficient financial potential of 
most medium and small agricultural companies.  
The exception is large agricultural holdings, where 
the company's philosophy is strategically focused  
on finding a balance between the interests of  
business, society and the environment, which is seen  
as an essential criterion for inclusive corporate 
agricultural management. This philosophy has  
resulted in the implementation of a wide range of  

social responsibility programmes for agricultural 
businesses, which are supported by large-scale  
financial support and are reflected in the voluntary  
non-financial reporting of agricultural holdings. 
In contrast, small- and medium-sized agricultural 
enterprises in Ukraine have significant problems 
with adopting the principles and priorities of social 
responsibility and implementing them in practice. 
Studies have shown that in the area of responsibility  
of Ukrainian agribusinesses, there are significant 
problems in the use and preservation of natural  
resources in rural areas, in particular, land. The loss  
of farm animal biodiversity is occurring at an  
extremely alarming rate. The decline in their  
productive stock, especially cattle, strategically 
limits the potential for reproducing the natural 
fertility of Ukraine's soils, which are already the most  
ploughed up in Europe. There are also significant 
problems in the use of agricultural labour and  
significant inclusion gaps in rural areas. The results  
of the study showed that, in general, the level of  
social responsibility of Ukrainian agricultural  
business remains low (with the exception of large 
agricultural holdings).

With a view to finding tools for enhancing social 
responsibility of agrarian business in Ukraine, the 
authors of the article propose a system of principles 
and criteria of socially responsible business for 
implementation in the sphere of inclusive corporate 
governance of Ukrainian agrarian companies. The 
authors are inclined to the scientific hypothesis that 
social responsibility of business is an effective tool 
for the practical implementation of the strategy of 
sustainable development of agriculture and rural  
areas. Understanding and acceptance of the values 
of socially responsible agribusiness by the owners 
of agricultural companies and all participants in the 
social agricultural process can form the preconditions 
for finding financial sources to achieve the goals  
of sustainable development of the agricultural sector.

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Received on: 05th of October, 2023
Accepted on: 21th of November, 2023
Published on: 28th of December, 2023