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Vladimir Putin: Good afternoon.

I am very pleased to be here. The Chamber of Commerce and Industry is located at a nice place. A place that is wonderful just to visit. I don’t come here often, but every time I am here I am happy.

I believe this is not a routine meeting, as it is now New Year’s Eve, and I would like to wish you and your colleagues and families all the best in the coming year.

Today the issue of businesses’ social responsibility is being widely discussed and state bodies give it a high priority.

Practically, the whole range of Russian business is represented here. It is a business association with vast experience and rich traditions. I hope that the business community, the country and the state will benefit from this experience. Like other countries, the Russian Chamber of Commerce and Industry will play a significant role.

Business has not simply been considering its social role in recent years but also has been doing a lot in practice, in everyday life. Obviously, the direct link between effectively managing production processes and solving social issues dictates the need to pay attention to this question.

The experience of the past few years clearly shows that business cannot and should not avoid taking part in solving social problems. Moreover, it will be advantageous for business to take part in projects that improve working conditions and workers’ lives. In the near future, I hope that business will play an increasingly greater role in the state’s social programmes as a whole. At any rate, business has the opportunities to do this. I believe that business is interested in doing this. I am convinced that successfully solving the most pressing social issues is a common task for business and the state.

As you know, in January the value added tax will be reduced by 2%, and a 5% sales tax will be lifted. When discussing this issue, regional and Moscow authorities disagreed with us.

I agree with the Moscow Mayor: the losses will be fairly large. Nevertheless, we managed to agree with local officials. We agreed to compensate for local expenditures from the budget. The owners, heads and managers of large chains repeatedly told us that this move would reduce prices on January 1. I hope this will happen.

Honestly, these were not just discussions about social problems. We had vigorous debates. We had to make accurate calculations. In connection with this, I believe businesses will understand that we are doing that for the benefit of the country’s economy, not for John Doe. And you, owners, company leaders and managers, should know that. And I would like to draw your attention to joint work in this sphere.

Firstly, and we have spoken about this on many occasions, this means the development of medium-sized and small business in the country. We have already spoken about this a lot. Unfortunately, movement in this direction has not been so effective as we might have liked. We have so far not done a great deal. However, this is a very good reserve for the development of the nation’s initiative and solving a priority task that we are obliged to deal with. By this, I mean the eradication of poverty.

I would suggest that such communities as chambers of commerce and industry, which have great managerial experience and the necessary resources, could make their contribution to solving the problem of small business.

The Chairman of the Chamber and I discussed this many times. I am well aware of your opinion on this subject, at least of the Chamber’s opinion. Mr Primakov has made a number of offers and critical statements addressing those responsible in this sphere. You should continue your work even if some of your plans are still pending. I would like to ask all those present here, you, Mr Primakov, and your colleagues to take active measures.

The second area that I consider to be important for our joint work is upholding in full workers’ social and labour rights. The practice of so-called informally hiring workers has become widespread. The negative consequences for such “shadow” labour relations are not only confined to the state’s financial losses. The most important aspect is that the workers themselves lose, as they cannot stand up for their employment rights. At the same time, this practice undermines belief in the state and faith in the advantages of the market economy system.

I would suggest that businessmen need to make efforts to change the situation fundamentally today, including through uniting the roles of organisations such as Russia’s Chamber of Commerce and Industry.

Of course, this cannot be a quick process, but corporative principles of social responsibility can and should be formulated today and put into practice. You know that social accounting reports, as certified by independent auditors, have long been one of the most powerful arguments for economic competition in the developed countries.

I would also like to point out the area of presenting employees with wide opportunities to study and improve their qualifications. There is experience of this advanced education, but it has so far not become widespread.

And, finally, to conclude, I would like to mention the subject of cooperation between the state and business in drawing up an agreed investment policy. The business community today not only possesses economic but also considerable creative, expert potential. Of course, if the truth be told, some of these resources often go on lobbying for narrow corporate interests, on the so-called optimisation of tax burden. I am very much counting on the fact that this will be used for solving those questions that we are talking about now.

I think that the time has come to work together on investment in such spheres as education, health care, the environment and regulating the flow of labour migration. Obviously, your participation in discussions about the mortgage system, as well as the social problems of the army, is essential.

You know that all this is to be analysed by working groups for solving priority national tasks. These groups include experts from the country’s main political forces. However, the long-term needs of the state and business coincide here. Our energetic cooperation should be mutually advantageous here. I am convinced that there is enough work for everyone in the social sphere.

I have only pointed to a few areas that require your and our joint efforts, attention and combined approaches today. And I am counting that here, in the Chamber of Commerce and Industry, further steps will be taken to draw up principles of the social responsibilities of business in the country.

Happy New Year! Thank you.