Corporate Social Responsibility (CSR)Arshed Rafiq

"Righteousness is not that you turn your faces towards the east or the west, but righteous is one who believes in God, and the last day, and the angels, and the Book, and the prophets, and who gives wealth for His love to kindred, and orphans, and the poor, and the son of the road, beggars, and those in captivity; and who is steadfast in prayers, and gives alms."

Quran 2:177

The Concept

• Whereby companies integrate social andenvironmental concerns in their businessoperations and in their interactions withstakeholders mostly on a voluntary basis

The Pakistani Context

• Voluntary corporate giving reached PKR 2.35 billion in 2009 from the base year figure of PKR 223 Million in 2000. Corporate giving amounted to 0.9% of the total profit before tax in 2009 in Pakistan. (This is the conservative figure because of lack of documentation. The progressive figure is given by Professor Lievenwho in 2011 wrote in his book “Pakistan – A hard Country” that Pakistanis gave 5% of GDP which is twice more than US giving a little above than 2%)

The Need

• Muslims believe that philanthropy pays backmulti-fold in Heaven and this world

• Impact becomes manifold (Currently, Pakistan 34th mostphilanthropic country in the World and 2nd in South Asia while Indiaholds 91st position but development indicators are abysmally lowdue to absence of corporate and institutional philanthropy,community and human resource development works)

• Government is non-functional• Future Legal Requirement (As per SECPs Companies

General Order, 2009, companies are directed to prescribedescriptive and monetary disclosures of their Corporate SocialResponsibility activities through their Directors' report to theshareholders annexed to the annual audited accounts.)

The Business Case

• Value Creation for business (Mutual Benefit)

• Mandatory Requirement for Exports (in countries likeHolland and Scandinavia)

• Image Building and Marketing

• Human Resource Attraction and Retention (Lowturnover as in Shakarganj)

The Pathway

• Philanthropic Responsibilities Be a good Corporate Citizen

• Ethical ResponsibilitiesBe ethical

• Legal ResponsibilitiesObey the law

• Economic ResponsibilitiesBe profitable

Pyramid of CSR

The Progress

• Programme for Industrial SustainableDevelopment has facilitated more than 55industries in textile processing, spinning, leather,sugar and paper sectors since 2007

The Plan

• The project planned to deliver 10 CSR reports from July 2010 to June 2013

• 5 Sugar industries have been delivered CSR reports including:

1. Shakarganj2. Haq Bahu3. Fatima4. Colony - I5. Brothers

The Data Requirements1. Brief Introduction of the mill2. Top Management Message3. Organizational Hierarchy and Geographical Set Up4. Net Sales/ Total Production5. Contribution to National Exchequer in one year (in terms of taxes etc)6. Donations to Community7. No of Suppliers 8. Customers ( Local/ International)

HR Distribution Male Female Total

Regular Employees

Managers

Seasonal Employees

Continued…1. BENEFITS TO EMPLOYEES Total Expenditure in

one yearDescription

A Salaries to Employees (in One Financial Year

B Residential Colony

C Bonus

D Social Security Contribution in One Year

E EOBI Contribution in One Year

F Others ( Fair Price Shop, Transportation etc)

2. BENEFITS TO COMMUNITY

A Institutions Run by the Company such as School/Colleges/Hospitals etc

Number of Students/ Patients:Number of Teachers/ Doctors:Totally Subsidized or Not:Facilities Provided:Community Served or Only Employees

b Support To External Institutions/ Community Organization/ NGOs/ Educational Institutes

C Any Other Programs such as Growers Support, Flood Relief& Disaster etc

The Expectations

• Before the Report:• Make a Liaison Person Available• Provide the Data

• After the Report:• Publish (electronically or in print form)

• Sustain (regularly produce every year)

• Train the People (for self generation of reports in future)

• Make Procedures for Data Collection (for impact evaluation and continual improvement)