corporate social responsibility - background & implications in india

Corporate Social

Responsibility

SANDIP ROYSATYAKI CHOWDHURY

NIRAB MAJUMDER

SURAJIT SAHA

RANIT SARKAR

SANCHARINI BANERJEE

PRESENTED BY :

Objectives of the Session

At the end of this session, you should be able to identify and describe:

A definition for CSR Brief History & Types of CSR Myths Surrounding CSR Need & Demonstration of CSR Benefits of CSR Evolution of CSR In India Corporates, India & CSR

What is Corporate Social Responsibility?

A concept that encourages organizations to consider the interests of society by taking responsibility for the impact of their activities on customers, employees, shareholders, communities and the environment in all aspects of its operations. Goes beyond the statutory obligation to comply with legislation Sees organizations voluntarily taking further steps to improve the quality of life for:

Employees and their families Local community Society at large

Brief History & Types of CSR• Based on the idea of `Social Responsibility (SR)’ before the dominance of corporate businesses and organizations.• The term "corporate social responsibility" came into common use in the late 1960s and early 1970s.• In the 1980s, business and social interest came closer and firms became more responsive to their stakeholders.

Generally 2 types of CSR exist :

a. Corporations providing funding and resources for worthwhile social causes.

b. Taking out a plan to produce products or provide services that are in the best interests of society, in the means of production and services.

Myths Surrounding CSR

CSR is not for small businesses

It is too complicated and technical

It is too expensive

It is a market gimmick

It is a separate corporate initiative

Social Responsibility Strategies

REACTIVE STRATEGY DEFENSIVE STARTEGY ACCOMODATION STARTEGY PROACTIVE STARTEGY

Carroll’s Pyramid of

CSR

Need For CSR

Issues such as environmental damage, improper treatment of workers, and faulty production leading to customer inconvenience or danger are being highlighted. Investors and investment fund managers have

began to take account of a firm’s CSR policy in making investment decisions.

Some consumers have become increasingly sensitive to the CSR program of the firms from which they buy their goods and services.

Need Of CSR For Consumers & SocietyImportant for encouraging businessesConsumer preferenceConsumer opinionsIssues mainly emphasized on by consumers:

Product qualityMoney valueTechnological advancements• Leads to increase in the awareness of the

society• Helps in dealing with societal matters

such as:• Nutrition & health issues• Human rights & gender• Labor practices• Involvement in community issues

Demonstration of CSR1. Environmental Sustainability: Areas include

recycling, water management, using renewable energy sources, creating 'greener' supply chains, etc. The highest ranked sustainability consulting firm is Ernst & Young

2. Community Involvement: This can include raising money for local charities, sponsoring local events, employing people from a community, etc.  Starbucks is an example of a company that focuses on community involvement.

3. Ethical Marketing Practices: Companies that ethically market to consumers are placing a higher value on their

customers and respecting them as people who are ends in themselves.

Potential Business Benefits of CSR TRIPLE BOTTOM LINE : People, Planet & Profit.People - Relates to fair and beneficial business practicesPlanet - Refers to sustainable environmental practicesProfit -   Is the economic value created by the organization after deducting the cost of all inputs

HUMAN RESOURCES : A CSR

program can be an aid to recruitment

and retention, particularly within the

competitive graduate student market.

RISK MANAGEMENT : Building a genuine culture of 'doing the right thing' within a corporation can offset these risks.

Potential Business Benefits of CSR BRAND DIFFERENTIATION : In crowded marketplaces, companies strive for a unique selling proposition that can separate them from the competition in the minds of consumers. CSR can play a role in building customer loyalty based on distinctive ethical values.

LICENSE TO OPERATE : To avoid

interference in their business through taxation or regulations.

SUPPLIER RELATIONS : Emphasize the importance of practicing CSR to suppliers & researching on existing supply chains.

Benefits of CSR

Winning new businesses

Enhancing your influence in the industry

Attracting, Retaining and

Maintaining a happy workforce

Increase in customer retention

Differentiating yourself from the

competitor

Saving money on energy and operating cost

Access to funding opportunities

Media interestand goodreputation

Enhanced Relationship with

stakeholders

Benefits Of CSR

Evolution Of CSR In IndiaPhase – 1 : In the pre Industrialization period, the main drivers of Charity were 1) Charity 2) PhilanthropyThe wealthy merchants shared their wealth by building temples, providing food during famines, etc. But with the arrival of colonial rule, the approach changed & the industrial families became strongly inclined towards economic & social considerations. Phase – 2 : During the Independence period, Mahatma Gandhi introduced the notion of trusteeship.Under his influence businesses established trusts for schools and colleges and also helped in setting up training and scientific institutions. All these were in line with Gandhi’s reforms to abolish untouchability, women empowerment & rural development.

Evolution Of CSR In IndiaPhase – 3 : CSR was influenced by the emergence of Public sector undertakings to ensure proper distribution of wealth. The policy of industrial licensing, high taxes and restrictions on the private sector resulted in corporate malpractices. Therefore there was a natural shift of expectation from the public to the private sector and their active involvement in the socio-economic growth.

Phase – 4 :  Indian companies integrated CSR into a sustainable business strategy. With  partial withdrawal of controls and licensing systems there was a boom in the economic growth of the country. This led to the increased momentum in industrial growth, making it possible for the companies to contribute more towards social responsibility

What started as CHARITY is now understood and accepted as RESPONSIBILITY.

General Values Statement

ENVIRONMENTAL FOCUS“While we have always sought to be sensitive to the environment, we must use our significant resources and capabilities to provide active leadership on environmental issues, particularly those relevant to our business. We are committed to preserving our environment , from the use of more than $2 billion a year in recycled content & suppliers & beautification efforts.”

General Values Statement

EMPLOYEE FOCUS

Johnson & Johnson’s Balancing Work & Family program reflects our credo commitment to help employees manage work and family life. This effort offers advantages to employees and to the Company, which is able to attract, recruit and retain the most talented employees and offer them a host of benefits.

CORPORATES, INDIA & CSR

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1995- Tata Business Excellence Model - Makes sustainable growth a priority and has included this in its Key Enterprises Process.1999- Tata Code of Conduct - Mandates good governance ethical behavior by organizations as well as each and every employee.1995- Tata Council for Community Initiatives Provides the superstructure for CSR efforts across the Group. 2003- Tata Index for Sustainable Development A CSR measure adopted across the Tata Group.

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Areas of Impact

EnvironmentStimulating Economic GrowthSports and AdventureHealth for AllEducation / Arts and Culture

SOCIAL PERFORMANCE The environment policy of the Company promotes energy conservation, 3Rs (Reduce, Reuse and Recycle), green procurement, environment friendly mobility and environment consciousness among its direct stakeholders.

Maruti Suzuki became the first automobile company in India to register a Clean Development Mechanism (CDM) project with the United Nations Framework Convention on Climate Change (UNFCCC).

Maruti Suzuki runs an in-house volunteer programme for its employees. The programme runs in partnership with local NGOs.

Conclusions

A. Corporate had moved ahead to a really new level to

fulfill their Social Responsibility which not only helps

the society but also to these companies to make a

reputation in the society.B. The expectations from private sector

regarding CSR is very high.C. Corporate companies should be encouraged

and motivated to contribute more.

So, Companies not doing CSR will not survive.

It’s only the Question of “WHEN”…….