csr & competitiveness august 2013

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CSR & Competitiveness | August 2013

www.csrcompetitiveness.com

‘CSR and Competitive-ness’ has been dynami-cally proactive to analyze the latest developments in the various dimensions of the business environ-ment so as to sensitize and facilitate its’ readers to help them evolve world class strategies to become globally competitive.

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Dear Readers,

I am very happy to share with you that we are receiving overwhelming response for the maga-zine ‘CSR & Competiveness’ from the leaders from corporate, civil society, researchers and students of not only India but also from various part of the globe.

Thank you all for giving this overwhelming & en-couraging response, support and useful sugges-tions and �nally your solidarity towards CSR and the cause, “CSR & Competitiveness” stands for.

You are well aware that historic Companies Bill has been passed on August 8, 2013. The Indian republic has made a dynamic move by intro-ducing the Companies Bill 2012 to present the new form and structure of the companies act promulgated way back in 1956. We are com-mitted to keep a tab on the changing dimen-sions of the business environment and sensitize our readers of the latest updates to facilitate them in formulation of strategies to make their products, services and the organization globally competitive. The new bill has ushered an era of optimism among the corporates with a positive view angle. The regulatory environment in India has witnessed a paradigm shift thereby leading to new set of challenges posed to the corporate world to comply with the latest provisions of the companies bill 2012 in a time bound manner.

‘CSR and Competitiveness’ has been dynamically proactive to analyze the latest developments in the various dimensions of the business environ-ment so as to sensitize and facilitate its’ readers to help them evolve world class strategies to become globally competitive.

It is the best time for the Indian corporate world to analyze the varied provisions of the recently passed Companies Bill 2012, in the Lok Sabha to re-align the strategic roadmap of the organiza-tion and the CSR strategies to make their organi-zation globally competitive and sustainable. The government and the corporates have done a commendable job by structuring, aligning the priorities of the government and the various stakeholders in the form of companies bill 2012.

The most challenging imperative for the compa-nies is to bring about a change in composition and con�guration of the top level management

including the board of directors to ensure scru-pulous compliance to the provisions of the Com-panies Bill 2012 in a time bound manner. The dynamic team of board of directors is required in the light of various expectations from the com-pliance perspective as well as to ensure develop-ment of team of highly competent professionals in a conducive environment committed to the cause of excellence and innovation on a dynam-ic basis in the light of exponentially dynamic dimensions of the business environment.

The secret of success in the modern digital era would be to create a world class team of pro-fessionals at various levels of organizational hierarchy committed to the cause of learning and development focusing on innovation and excellence on a dynamic basis to be proactively dynamic, committed to deliver quick response to challenges and opportunities in the globally dynamic corporate world.

To conclude, the Companies Bill 2012, has led to the emergence of challenges and opportunities for the companies looking at change with a pro-active view angle. It is the best time to introspect and evolve the strategic planning process reori-ented towards highest degrees of compliance in the light of the recent changes. The companies which shall proactively plan and implement the strategic roadmap to combat the challenges arising in the new regulatory environment shall be able to tide over the challenges of the com-petitive market scenario at the national and international level. The enhanced level of focus on strategic planning, implementation and con-trol optimally complimented and supplemented by an organizational environment driven by the culture of learning and innovation in all facets and domain areas shall make the organization, its products and services globally competitive.

CSR Toon- Renowned Cartoonist Triyam-bak Sharma, Editor, Cartoon Watch, the only monthly Cartoon Magazine of India, has agreed to contribute ‘CSR Toon’ for the magazine. We welcome him in our editorial board and hope our readers will enjoy his creativity. Triambak is featured in Limca Book of Records for publishing only bilingual cartoon magazine over 15 years. Enjoy the ‘CSR Toon’ published in cover page.

Vol.1 I Issue -2 I August 2013 I Monthly

CSR & Competitiveness does not accept responsibility for returning unsolicited manuscripts and photographs. All unsolicited material should be accompanied by self-addressed envelopes and su�cient postage.

Reproduction is whole or in part without written permission of the publisher is prohibited. All right reserved. The views and opinions expressed by the authors do not necessarily re�ect those of the pub-lisher or the editorial sta�. Please inform us if any copyright has been inadvertently infringed. CSR INDIA CORPORATE SOCIAL SERVICES PVT LTD and CSR & COMPETITIVENESS is not responsible and liable for any comments and articles published by its contributors and will not be liable for any damages. All disputes are subject to the exclu-sive jurisdiction of competent courts and forums in Raigarh, India.

Vijay KapurEminent CSR Consultant & AuthorDirector – Kohana CSR

Enakshi SenguptaEminent CSR Consultant & AuthorDirector – Kohana CSR

Prof BD SinghRenowned Academician & Author

Dr K K UpadhyayHead CSR-Ficci Aditya Birla CSR Centre of Excellence

Monaem Ben LellahomCo-Founder & Head of Sustainabil-ity Advisory Services Sustainable Square Consultancy and Think TankUAE

Rusen KumarEditor

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News Tata Steel’s direct contribution to community development is Rs. 170.76 crores which is 3.37% of the Company’s Profit After Tax. This is not inclusive of the expenditure on envi-ronment, which is more than Rs. 300 cores.

04

Tata Steel CSR Touches 20 Lakh Lives in Jharkhand and Odisha

Fullerton India Bags Asia CSR Award for Community Development

Tata Steel Ltd spent Rs. 170.76 crores towards corpo-rate social responsibility (CSR) during �nancial year

2012-13 which is 3.37% of company’s Pro�t After Tax (PAT) excluding spend on Environment Sustainability which is about Rs. 300 crores. The Tata Steel CSR initia-tives touched nearly 2 million lives last years, Tata Steel said in Annual Report for the year 2012-13. Pro�t After Tax at Rs 5063 crores during the �nancial year 2012-13 was lower by 24% as compared Rs 6696 to the �nan-cial year 2011-12. The amount was spent under the broad categories such as infrastructure development to improvement to quality of the life of community, community de-velopment, health & medical support and support to charities and NGOs & Government for social cause. The operational area of the Company is the state of Jharkhand and Odisha are plagued by poor social in-frastructure for health services, education, road, elec-tricity and other basic amenities. The range of inter-ventions encompassed infrastructure support to rural and urban schools through scholarships and coaching classes as well as incentives like free mid-day meals to encourage attendance form part of its key thrust area for improving the quality of life.

Solar Streetlight ProjectFor instance under the solar streetlight project Tata Steel installed solar streetlights in villages. To ensure the upkeep of installed lights and their sustained use by the village community, discussions were held with community resulting in the constitution of commit-tees called ‘Urja Samitee’. Select members from the village community are enlisted onto the Urja Samitees (Energy Committees) and are responsible for the maintenance of the solar panels.

Thrust Area for CSRTata Steel focuses on responsible business practices with community-centric interventions. The thrust area for Tata Steel are sustainable livelihood-specially skill development and employability training, education

and health care, all of which constitute the Human De-velopment Index- a quality of life indicator.

Partners for CSR ImplementationTata Steel partners with NGOs, Governments and fund-ing agencies to implement its CSR interventions in the thematic area of health, education, livelihoods and ethnicity. Through employee volunteerism it also uti-lises in house resource persons. The CSR activities are implements through the follow-ing delivery arms:1. Corporate Sustainability Services comprising, Tata

Steel Rural Development Society (TSRDS), Tribal Culture Society (TCS), Tata Steel Family Initiatives Foundation (TSFIF), Tata Steel Skill Development Society (TSSDS), Urban Services and Education

2. Medical Services 3. Sports Department 4. Tata Steel Adventure Foundation 5. Jamshedpur Utilities & Services Company Limited 6. Other societies such as Ardeshir Dalal Memorial

Hospital, Blood Banks, Kanti Lal Gandhi Memorial Hospital, etc.

7. Tata Relief Committee

Impact AssessmentThe impact assessment is done through various meth-

ods such as social audit, aspiration surveys, village lev-el study of Human Development Index (HDI) and XISS JRD Tata Chair. Social Audit : As a socially responsible corporate citi-zen, Tata Steel commissions social audits through in-dependent professionals to get authentic and compre-hensive review of its social activities. The Social Audit is conducted in ten years.Aspiration Surveys : Conducted among community residing in the operational areas of Tata Steel in Odi-sha.Village Level Study of Human Development Index (HDI): Conducted by a team of researchers from Xavier Labour Research Institute (XLRI), Jamshedpur.XISS JRD Tata Chair : The ‘JRD Tata Chair’ has been instituted at Xavier Institute of Social Services, Ranchi with the objective of conducting a study on ‘ Contribu-tion of Tata Steel towards Sustainable Development . The value underpinning all business actions at Tata Steel is to serve Common Good, ensuring that all its excellence programmes integrate economic, environ-mental and social performance driven.

What Does Sustainability Means to Tata Steel?Tata Steel has been one of the �rst companies in In-dia to adopt sustainability as a policy. It is a core value, built on our respect for people, our desire for growth and our respect for the environment. Building further on this vision, Tata Steel is the �rst Indian company to be a part of the International Integrated Report-ing Council (IIRC) – an international initiative towards voluntary communication on how an organisation’s strategy, governance, performance and prospects lead to the creation of value over the short, medium and long-term.

(Tata Steel, 106th Annual Report-2012-13)

Fullerton India Credit Company Limited, a leading Non-Banking Finance Company, has been granted the Asia CSR Award for Community Development at the 3rd Asia’s Best CSR Practices Awards event, held in Singa-pore on August 1, 2013. On behalf of Company, the award was received by Anindo Mukherjee, Head of Inte-grated Risk Management, Fullerton Financial Holdings, Singapore & Cynthia Lee, Director on Board of Fullerton India & Head of Human Resources, Fullerton Financial Holdings, Singapore.The award was bestowed, recognising Fullerton India’s Rural Livelihood Advancement initiative and its large impact on rural households across India. The award is Asia’s most prestigious and highest recognition of cor-porate organisations that have created a signi�cant and positive impact on the lives of people in society.Fullerton India has a rich history of rural development initiatives in India and has won a string of awards for its CSR initiatives across various platforms, adding another feather to its cap with this esteemed win. Commenting on the occasion, Ravi Shankar, Executive Vice President Marketing & Rural Business stated, “Full-erton India is strongly committed towards the overall development of rural India and works towards this by facilitating new and alternate vocational training pro-grams to men and women in villages, across our rural branch catchments.”

He added, “Our CSR initiative is focused on Rural Liveli-hood Advancement and designed to have a sustainable impact on its bene�ciaries. These programs aimed at ru-ral households are implemented by engaging over 2000 of our employees. We are honoured to have received this award as recognition towards our e�orts and initia-tives.”As part of its Livelihood Advancement Initiative, Fuller-ton India conceptualises various Livelihood Programs with Partner organisations across various disciplines, thus bringing together Partner organisations like the Government, NGOs, Socio-Economic development or-ganisations, Manufacturing and Trading organisations in the Private sector to implement the programs. Fullerton India Credit Company Limited has over 360 branches spread across 20 states in urban and rural centres. It o�ers several retail �nance products for vary-ing needs of customers ranging from rural households to SMEs, in the locations it serves. Fullerton India has a widespread reach in Rural India through its network of 144 rural business branches called Gramshakti, which service over 15,000 villages. Fullerton India is a wholly-owned subsidiary of Fullerton Financial Holdings, Sin-gapore, which is a subsidiary of Temasek Holdings of Singapore.

Fullerton India has a widespread reach in Rural India through its network of 144 rural business branches called Gramshakti, which service over 15,000 villages.

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Training in sewing embroidery using machines to cater to the garment industry



Cover Story Historic Companies Bill, 2012 05

Parliament Passes the Historic Companies Bill, 2012

When Companies Act, 1956, was promulgated there were only 30,000 companies while in May 2013, there are 13.21 Lakh

�rms in India.

The historical New Companies Bill, which will replace the nearly 57-year-old Companies Act of 1956, was �nally passed in Rajya Sabha by voice vote on August 8, 2013. The lower house of parliament Lok Sabha had already been cleared the bill December 18, 2012. Now, only the Presi-dent’s assent will be required for it to become law. The draft rules on the companies act will then be made public and the act comes into e�ect with noti�cation by Ministry of Corporate A�airs.

Wrapping up the debate in Rajya Sabha, Corporate A�airs Minister Sachin Pilot termed the passage of the legislation a “historic feat”. “The passage of the Bill will give impetus to the growth momentum,” Pilot said, adding, “The focus of the bill is to enhance transparency and en-sure fewer regulations, self reporting and disclosure...It will outline the positivity in the economy”. The new law requires companies that meet certain set of criteria, to spend at least two per cent of their average pro�ts in the last three years towards Corporate Social Responsibility (CSR) activities.

Replying to the debate on the bill in the Rajya Sabha, Corporate A�airs Minister Sachin Pilot said it sought to bring India’s corporate govern-ance in sync with the changing business environment of the 21st cen-

tury. Pilot said the bill was pro-gressive and the main focus was on enhancing transparency and compliance and it would help growth of the economy.

“For the next two to three dec-ades, this (new legislation) will bring positivity in the economy,” said Pilot adding that the views of all the stakeholders, including industry chambers, have been taken into consideration. “The focus of the bill is to enhance transparency and ensure fewer regulations, self-reporting and disclosure,” Pilot said.

The Bill has been designed to consist of 29 chapters, containing 470 clauses and 7 schedules.

The law has been rewritten ex-tensively with several new pro-visions for investor protection,

better corporate governance and corporate social responsibility etc. It de�nes a number of new terms such as Associate Company, Small Com-pany, Employee Stock Option, Promoter, Related Party, Turnover, Chief Executive O�cer, Chief Financial O�cer, Global Depository Receipt, that have come into vogue in recent times.

The new Bill has introduced numerous changes and concepts which should simplify regulations and bring greater clarity and transparency in managing businesses. The global environment calls for economic laws and regulations that are e�ective and e�cient, have a reasonable compliance cost and keep Indian businesses competitive. Upon enact-ment, there will also arise the indispensable need for aligning the exist-ing regulations with the new law.

Industry hopes that the working rules which are expected to be put out in the public domain before noti�cation would provide greater clarity on the operative provisions in the Bill while taking into account legiti-mate concerns of India Inc.

Journey of Passing the Bill The bill was �rst introduced as Companies Bill 2009 in Lok Sabha on August 3, 2009. It was referred to Parliamentary Standing Committee on Finance a month later. It brought back to the Lok Sabha as Companies Bill 2011, but again referred to the Standing Committee . Govern-ment accepted about 96 per cent of the sug-gestions of the Standing Committee. The bill was cleared by the Lok Sabha after the stand-ing committee submitted its report in June 2012. Lok Sabha had been passed the bill De-cember 18, 2012

The Companies Bill, which will replace legis-lation that has often been criticised for being outdated and cumbersome, had been in the works for at least a decade but gained momen-tum after an accounting scandal at Satyam Computer Services Limited in the year 2009. This was country’s biggest corporate fraud case where Satyam Computer Services caused loss to the investors to the tune of Rs.14,162 crore. The company head, Ramalinga Raju and mem-bers of his family secured illegal gains to the tune of about Rs.2,743 crore by various tricks.

The new Companies Bill, on its enactment, will allow the country to have a modern legislation for growth and regulation of corporate sector in India. In view of various reformatory and contemporary provisions of the law, together with omission of existing unwanted and obso-lete compliance requirements, the companies in the country will be able to comply with the requirements of the Companies Act in a better and more e�ective manner.

The existing statute for regulation of compa-nies in the country, viz. the Companies Act, 1956 had been under consideration for quite long for comprehensive revision in view of the changing economic and commercial environ-ment nationally as well as internationally. The new law will facilitate business-friendly corpo-rate regulation, improve corporate governance norms, enhance accountability on the part of corporates/ auditors, raise levels of transpar-ency and protect interests of investors, particu-larly small investors.

The Companies Bill is commensurate with glob-al standards vis-à-vis disclosure requirements, increased democratic rights for shareholders, self-regulation and accountability. At the same time, it also seeks to restrain the management powers of promoters, who nurture the compa-ny during its initial stages and provide the seed capital.

In a country where 75-80% of the business-es are family-run/ promoter-driven, indus-try hopes that the new law would be able to achieve the �ne balancing between ownership and management, which is crucial for success of any enterprise and also fostering the spirit of entrepreneurship.

With the new legis-lation, India would possibly become the �rst country to have Corporate Social Responsibil-ity (CSR) spending through a statu-tory provision.

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Six decades after the �rst Companies Act was enacted and over 20 years after liberalisation, India inched closer to bringing more contemporary issues, such as corporate governance, investor protection,

corporate social responsibility and measures to check frauds, under the legislation.




1. (Amendment in Clause 135):

In the Section on Corporate Social Responsibility (Section135), which is introduced as a statutory provision for the �rst time, the words ‘make every endeavour to’ have been omitted from its Sub-clause (5). So that the �rst para of Sub-clause (5) of Clause 135 now reads as follows: “The Board of every company referred to in sub-section (1), shall ensure that the company spends in every �nan-cial year, at least two per cent of the average net pro�ts of the company made during the three im-mediately preceding �nancial years, in pursuance of its Corporate Social Responsibility Policy.”

Such clause is also amended to provide that the company shall give preference to local ar-eas where it operates, for spending amount ear-marked for Corporate Social Responsibility (CSR) activities. The approach to ‘implement or cite rea-sons for non implementation’ retained.


To help in curbing a major source of corporate de-linquency, Clause 36 (c) amended, to also include punishment for falsely inducing a person to enter into any agreement with bank or �nancial institu-tion, with a view to obtaining credit facilities.


Provisions relating to audit of Government Com-panies by Comptroller and Auditor General of In-dia (C&AG) modi�ed to enable C&AG to perform such audit more e�ectively.


Clause 186 amended to provide that the rate of interest on inter corporate loans will be the pre-vailing rate of interest on dated Government Se-curities.


Provisions relating to restrictions on non audit services modi�ed to provide that such restrictions shall not apply to associate companies and fur-ther to provide for transitional period for comply-ing with such provisions.


Provisions relating to separation of o�ce of Chair-man and Managing Director (MD) modi�ed to al-low, in certain cases, a class of companies having multiple business and separate divisional MDs to appoint same person as chairman as well as MD.

7. (Amendment in Clause 147 And 245):

Provisions relating to extent of criminal liability of auditors - particularly in case of partners of an au-dit �rm - reviewed to bring clarity. Further, to en-sure that the liability in respect of damages paid by auditor, as per the order of the Court, (in case of conviction under Clause 147) is promptly used for payment to a�ected parties including tax authori-ties, Central Government has been empowered to specify any statutory body/authority for such pur-pose.


The limit in respect of maximum number of com-panies in which a person may be appointed as au-ditor has been proposed as twenty companies.


Appointment of auditors for �ve years shall be subject to rati�cation by members at every An-nual General Meeting.


Provisions relating to voluntary rotation of audit-ing partner (in case of an audit �rm) modi�ed to provide that members may rotate the partner ‘at such interval as may be resolved by members’ in-stead of ‘every year’ proposed in the clause earlier.


Whole-time director’ has been included in the de�nition of the term ‘key managerial personnel’.


The term ‘private placement’ has been de�ned to bring clarity.


Approval of the Tribunal shall be required for con-solidation and division of share capital only if the voting percentage of shareholders changes con-sequent on such consolidation.


Clari�cation included in the Bill to provide that ‘Independent Directors’ shall be excluded for the purpose of computing ‘one third of retiring Direc-tors’. This would bring harmonisation between provisions of Clause 149(12) and rotational norms provided in Clause 152.


Provisions in respect of removal of di�culty modi-�ed to provide that the power to remove di�cul-ties may be exercised by the Central Government up to ‘�ve years’ (after enactment of the legisla-tion) instead of earlier up to ‘three years’. This is considered necessary to avoid serious hardship and dislocation since many provisions of the Bill involve transition from pre-existing arrangements to new systems.

The Bill provides for class action suit, the move aids in-dividual shareholder to take action against companies, better disclosure requirements in �nancial statements and disclosure of interests of directors etc. The Bill has tightened the screws on insider trading norms in the country, it aims at prohibition on forward dealings in se-curities of company by key managerial personnel, insid-er trading rules and restriction on non-cash transactions involving directors.

Highlights of the Companies Bill• Concept of One Person Company (OPC limited) in-

troduced. Which will be treated as Private Limited Company only.

• The bill increased the number of members of pri-vate companies from 50 to 200. This allows compa-nies access to large pool of capital without going public.

• The new bill gives recognition to transfer restric-tions on inter-se shareholders – ‘Right of First Re-fusal’ will be enforceable. This would clear existing ambiguity on legal enforceability on transfer re-strictions under JV/shareholder agreements.

• While the old bill only permitted merger of a for-eign company with an Indian company, the new bill allows merger of Indian companies into foreign companies which would aid in consolidation of cross-border businesses/assets.

• The new bill permits merger of a listed company with an unlisted one, subject to exit opportunity being o�ered to shareholders of the listed compa-ny.

• While the old bill depended on precedents for merger of a subsidiary with a parent (or between two small companies), the new bill provides a sepa-rate and simpli�ed regime for this without any ap-proval from High Court.

• The new bill also gives rights for objections to schemes to only creditors who owed over 5 per cent and minority shareholders with over 10 per

cent stake against no thresholds earlier.

• The new bill also has a detailed mechanism for ac-quisition of shares by majority shareholder from mi-nority shareholders.

• The bill restricts creation of multi-layered hold-ing structures, prohibiting making investments through more than two layers of investment com-panies.

• The new bill bans holding ‘Treasury Stock’, which is often used by companies to increase shareholding or future monetization after consolidation.

• The new bill asks that listed companies and other speci�ed companies will have to change individual auditor after �ve years and audit �rm after 10 years. The old bill had no provisions for this.

• Under the new bill, companies are required to spend at least 2 per cent of their net pro�t on Cor-

porate Social Responsibility (CSR). The companies to give preference to the local areas of their opera-tion for such spending.

• The new bill also requires companies to appoint one woman director.

• The proposed legislation would ensure setting up of special courts for speedy trial and stronger steps for transparent corporate governance practices and curb corporate misdoings.

• The changed law allows more statutory powers to the government’s investigative arm Serious Fraud Investigation O�ce (SFIO) to tackle corporate fraud.

• To help in curbing a major source of corporate de-linquency, introduces punishment for falsely induc-ing a person to enter into any agreement with bank or �nancial institution, with a view to obtaining credit facilities.

• The limit in respect of maximum number of compa-nies in which a person may be appointed as auditor has been proposed as 20.

• Independent directors’ shall be excluded for the purpose of computing ‘one third of retiring direc-tors’.

• Appointment of auditors for 5 years shall be subject to rati�cation by members at every Annual General Meeting.

• ‘Whole-time director’ has been included in the de�-nition of the term ‘key managerial personnel’.

• The term ‘private placement’ has been de�ned to bring clarity.

• Maximum number of directors in a private compa-ny increased from 12 to 15 which can be increased further by special resolution.

• Financial Year of any company can end only on March 31 and only exception is for companies, which are holding / subsidiary of a foreign entity re-quiring consolidation outside India, can have a dif-ferent �nancial year with the approval of Tribunal.

The salient features of the new Companies Law

c Business friendly coporate Regulation/ pro-business initiatives;

c e-Governance Initiatives;

c Good Corporate Governance and CSR;

c Enhanced Disclosure norms;

c Enhanced accountability of Management;

c Stricter enforcement;

c Audit accountability;

c Protection for minority shareholders;

c Investor protection and activism;

c Better framework for insolvency regulation; and Institutional structure.

Major Amendment in the Bill are as follows:




Catalytic Role of the Bill• The Bill also provides great flexibility to busi-

nessandindustryforstrategizingandconduct-ingtheirCSRinitiatives;

• Intention of government and purpose of billisnottomakearigidstructurewhichwillcon-strainthecreativityandimaginationofthecor-porates;

• It will enhance their efforts, provide an evenbroaderplatformandre-energizetheirefforts.

Company Bill, 2012 Section 135 (1) Everycompanyhavingnetworthofrupeesfive

hundredcroreormore,or turnoverof rupeesone thousandcroreormoreoranetprofitofrupeesfivecroreormoreduringanyfinancialyearshallconstituteaCorporateSocialRespon-sibility Committee of the Board consisting ofthree ormore directors, out ofwhich at leastonedirectorshallbeanindependentdirector.

(2) TheBoard’sreportundersub-section(3)ofsec-tion134shalldisclose thecompositionof theCorporateSocialResponsibilityCommittee.

(3) TheCorporateSocialResponsibilityCommitteeshall,

(a) formulateandrecommendtotheBoard,aCor-porateSocialResponsibilityPolicywhichshallindicatetheactivitiestobeundertakenbythecompanyasspecifiedinScheduleVII;

(b) recommendtheamountofexpendituretobeincurredon theactivities referred to inclause(a);and

(c) monitor the Corporate Social ResponsibilityPolicyofthecompanyfromtimetotime.

(4) TheBoardofeverycompanyreferredtoinsub-section(1)shall,

(a) after taking into account the recommenda-tionsmadeby theCorporateSocialResponsi-bilityCommittee,approvetheCorporateSocialResponsibilityPolicyforthecompanyanddis-closecontentsof suchPolicy in its reportandalsoplaceitonthecompany’swebsite,ifany,insuchmannerasmaybeprescribed;and

(b) ensurethattheactivitiesasareincludedinCor-porateSocialResponsibilityPolicyofthecom-panyareundertakenbythecompany.

(5) The Board of every company referred to insub-section(1),shallensurethatthecompanyspends,ineveryfinancialyear,atleasttwopercent.oftheaveragenetprofitsofthecompanymadeduringthethreeimmediatelyprecedingfinancial years, in pursuance of its CorporateSocialResponsibilityPolicy:

Providedthatthecompanyshallgivepreferencetothelocalareaandareasarounditwhereitoperates,forspendingtheamountearmarkedforCorporateSocialResponsibilityactivities:Providedfurtherthatifthecompanyfailstospendsuch amount, the Board shall, in its report madeunder clause (o)of sub-section (3)of section134,specifythereasonsfornotspendingtheamount.Explanation. For thepurposesof this section“av-eragenetprofit”shallbecalculated inaccordancewiththeprovisionsofsection198.

Number of Registered Companies Crossed 13-lakh MarkThetotalnumberofregisteredcompaniesinthecountryhascrossed13lakhmark,but1.44lakhofthesefirmsare‘dormant’andhavenotfiledtheirannualreturnsforpastthreeyears.AsonMay31,2013,therewere13.21lakhcompaniesregisteredwithMinistryofCorporateAffairs.Ofthese,asmanyas2.6lakhcompanieshavebeenclosedforvariousreasonsincludingcourtorderandvoluntarywindingup,whileanother30,435firmsareintheprocessofbeingliquidated,anofficialstatementsaid.Besides,1.44lakhcompanieshavenotfiledtheirannualreturns/balancesheetsformorethanpastthreeconsecutiveyearsandareclassifiedas‘dormant’.Thereare8.77lakhactivecompaniesofwhich1.5lakhhadbeenincorporatedwithinthepreceding18months.

New Rules to be in Place by FY’14 EndTheMinistryofCorporateAffairsexpectsalltherulesregardingtheCompaniesbilllikelytobeinplacebytheendofthisfiscal,aftertakingintoaccountthesuggestionsfromexperts,publicandotherstakeholders.Arulesadvisorycommitteecomprisingmembersfromleadingindustrychambers,dignitaries,expertsandlawyersamongothers,iscurrentlyworkingondraftrulesandthesameareexpectedtobeputforthonMCAwebsiteforpubliccommentsbytheendofthismonthitself,MinistryofCorporateAffairsJointSecretaryRenukaKumarsaid.

Once the new law is put in place, profit-makingcompanieswillbe required to spend twoper centoftheiraveragenetprofitofthreeyearsonactivitiesrelatedtocorporatesocialresponsibility(CSR).ThreeyearswillbecountedasprecedingtheoneduringwhichCSRwastobeundertaken.However, the government has diluted themanda-toryprovisionforCSRafterobjectionsfromIndiaInc.Thosefailingtomeettheobligationwillhavetoex-plainthereasonsfortheshortfall.ThenormisvalidonlyforcompanieswithnetworthofRs.500croreormore,orturnoverofRs.1,000croreormore,oranetprofitofRs.5croreormore,during thepast threefinancial years. Experts believe this would bring aparadigmshiftbecausetheoldlegislationonlypro-videdforvoluntaryguidelinesforCSR.Itwillcreateanopportunityforcompaniestoevolveinnovativestrategiestocontributetowardsinclusivegrowth.

ThePurposeof InclusionofCSR in theCompaniesBill• TheCSRprovisionsoftheBillseektocreatean

enablingenvironment;• Billallowscorporatestoharnessandchannelize

theircorecompetenciesaswellasdevelopef-fectivebusinessmodels;

• Itwillpromoteandfacilitatefarbetterconnectbetweenbusinessesandcommunities.

• Itwillfacilitatedeeperthoughtandlongertermstrategies for addressing some of our mostpersistentsocial,economicandenvironmentalproblems;

• It will assist in synergizing partnerships be-tween Corporates, Governments, Civil SocietyOrganizations,AcademicInstitutionsandSocialEntrepreneurs.

Business Chambers Welcome the New Companies BillLeading business chambers and profession-al body including FICCI, CII and The Institute of Company Secretaries of India (ICSI) has welcomed the New Law.

“We heartily welcome the pas-sageoftheCompaniesBillwhichwill give India a comprehensiveand contemporary legislation.This legislation is indeedamile-stone in thehistoryof companylawandwillrevolutionizethead-ministrationandmanagementofbusinessesinthetimestocome.

FICCIhopesthattherearenoinconsistenciesin various laws since consistency and cer-tainty in laws helps in effective functioningofbusiness.AnylegislationevolveswithtimeandwearecertainandhopefulthatthenewCompaniesActwhileprovidinganenablingenvironmentforsmoothworkingandgrowthofIndiaInc.willalsoaddressvalidconcernsoftheIndustry.TheBillhasbeenthroughmanystagesofdiscussionandhasbroughtinmanyradicalchangestotheerstwhileAct.FICCIhasbeen part of these discussions and compli-ments theMinistry ofCorporateAffairs andits officials for adopting a highly pragmaticandconsultativeapproachtowardsevolutionofthepresentdayCompaniesBill.”

Naina Lal Kidwai,President,FICCI

“Thenewlawpromisesimprovedcor-porategovernancenorms,enhanceddisclosuresandtransparency,facilita-tionofresponsibleentrepreneurship,increasedaccountabilityofcompanymanagements and auditors, protec-tion of interest of investors particu-larly small and minority investors,better shareholder democracy, fa-

cilitation of corporate social responsibility(CSR) and stricter enforcement processes.NewCompanies lawwill further acceleratethe transformationofCompanySecretariesintocorporategovernanceprofessionalsbyrecognizingthemasKeyManagerialPersonsin a Company alongwith the Chief Execu-tiveOfficer/ManagingDirector/Manager,Whole-Time Director and Chief FinancialOfficer.TheCompanySecretaryisexpectedtobecometheChiefGovernanceOfficeroftheCompanyand leadthegovernance ini-tiatives. It envisages amuch larger role forCompanySecretaries in areasof secretarialaudit, restructuring, liquidation, valuationandmuchmore.”

S. N. Ananthasubramanian, President,CouncilofTheInstituteofCom-

panySecretariesofIndia

“WecommendtheGovernmentforprioritizingtheBill.ItshowstheGov-ernment’s commitment tousher intheneweraofcorporateregulation.TheCompaniesBillasinitspresentform is a culmination of efforts forover a decade and we are happythatmanyofCII’s viewshavebeenincorporatedinthelegislation.Now

thatthe lawisready, it istimetofocusandworkonthepracticalaspectsofcomplyingwith its provisions. CII will continue to en-gagewith theMinistry ofCorporateAffairstoworkoutthemodalitiesforvariousprovi-sionsthatprescribedelegatedlegislationintheformofRules.OnesuchvitalprovisionissurelytheclausedealingwithCSRspend.”

Chandrajit Banerjee,DirectorGeneral,

ConfederationofIndianIndustry

Board Shall Ensure the Company CSR Spends



Philanthropy Nilekani is among India’s growing list of “givers” who have pledged a significant portion of their wealth towards philanthropy. 08

Rohini Nilekani Sells Infosys Shares, Raises Rs.163 cr for Philanthropic work “For the past several years, I have taken philanthropic initiatives in multiple sectors such as edu-cation, water, environment and governance among others. The proceeds of the sale of shares, post tax, will be deployed towards these and other philanthropic contributions, over time.”

- Rohini Nilekani

Infosys Ltd, a global leader in business consulting and technology solutions, has said that wife of one

of its co-founder Nandan Nilekani, Rohini Nilekani, has raised about Rs.163.58 crore by selling 577,000 shares of the company for philanthropic work in In-dia.

Nilekani is the wife of Infosys co-founder Nandan Nilekani, who is currently the chairman of the Unique Identi�cation Authority of India (UIDAI). Mr Nilekani founded Infosys with NR Narayana Murthy and �ve others in 1981. He was the chief executive of Infosys from March 2002 to April 2007.

Nandan holds 1.45% stake or 83,45,870 shares in this Bangalore- based �rm.

In a BSE �ling, Infosys said Rohini Nilekani, who is also a promoter in the company, sold 577,000 shares between 16-19 July for a total of Rs.1,63,51,83,925. After the sale, her stake in Infosys stood at 1.31% or 7,501,174 shares, it added. For the period ended 30 June, her stake in the �rm was 1.41% or 8,078,174 shares.

In the �ling, she said: “For the past several years, I have taken philanthropic initiatives in multiple sec-tors such as education, water, environment and governance among others. The proceeds of the sale

of shares, post tax, will be deployed towards these and other philanthropic contributions, over time.” Rohini, 53, has been an active woman philanthropist for more than a decade. Her organization Arghyam grants funds to organisations, which implement and manage groundwater and sanitation projects in India. Arghyam has made grants to recipients in 22 states of India since 2005, the year of its found-ing. Arghyam, a foundation she set up with a private endowment, to work on water and sanitation issues in India. She is also Founder-Chairperson of Pratham Books, a charitable trust which seeks to put “A book in every child’s hand.”

Rohini has been deeply involved with development issues and is currently a member of the Audit Advi-sory Board of the Comptroller and Auditor General of India. She sits on the Boards of many non-pro�ts, no-tably ATREE (the Ashoka Trust for Research in Ecology and the Environment) and Sanghamithra Rural Fi-nancial Services. Rohini has authored a novel – “Still-born” - and also a non–�ction account of dialogues she moderated between social and corporate leaders called “Uncommon Ground”. Nilekani is among India’s growing list of “givers” who have pledged a signi�cant portion of their wealth towards philanthropy.

An ex-journalist, author and philanthropist, high net worth individual (HNI) Rohini Nilekani, wife of one of Infosys co-founder Nandan Nilekani, raised about Rs 163.58 crore by selling 5.77 lakh of her shares of the IT services company for philanthropic work.

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‘‘MUMBAI: In line with its mission of serving society through science,

Tata Chemicals, a Tata Group Company, is organizing its 3rd edi-tion of the annual BCTA (Best Chemistry Teacher Award) 2013 along with Association of Chemistry Teachers (ACT) and Confederation of In-dian Industry (CII). These awards recognize exceptional contribution of individuals from the Chemistry teaching fraternity and inspire a whole new generation to actively pursue chemistry and its allied subjects.

Nominations to apply for the awards will be open until September 30, 2013, wherein the applicant should be a full-time teacher engaged in teaching chemistry to class XI, XII, Graduate or Post Graduate level. The applicants of BCTA 2011 and 2012 (excluding the winners) are also eligible to participate in BCTA 2013. The nominations for the entries are classi�ed in �ve distinct award categories: Best Chemistry Teacher (Class XI/XII and equivalent), Best Chemistry Teacher (Bachelor’s De-gree and equivalent), Best Chemistry Teacher (For Master’s Degree and above), Best Chemistry Teacher for promotion of Chemistry as a sub-ject and Best Young Chemistry Teacher.

Tata Chemicals has created an interactive website called the Human Touch of Chemistry (www.humantouchofchemistry.com), wherein in-terested and eligible teachers can send in their nominations online for awards in the above mentioned categories. Teachers can also submit

handwritten applications by downloading the forms from www.humantouchofchemistry.com

The winners for the awards will be selected by eminent panelists comprising renowned Indian scientists, professionals and academia. The winner teachers will be felicitated at a formal award ceremony which will be announced in November 2013.

Best Chemistry Teacher Award Best Chemistry Teacher Award (BCTA) is an annual initiative organized by Tata Chemicals to hon-our exemplary chemistry teachers teaching class XI and XII, undergraduate courses and post-graduate levels. The Best Chemistry Teacher should demonstrate expertise in generating a pas-sion for chemistry in students. This Award also takes into cognizance contributions made by teachers towards promoting overall scienti�c literacy.

Tata Chemicals Invites Nominations for Best Chemistry Teacher Award 2013

“With the tremendous nationwide response re-ceived in the past, we are excited to launch the third series of the award. The BCTA awards recognize the e�orts of teachers who are responsible in creating awareness and educating the younger generation about the intrinsic pres-ence of Chemistry in eve-ryday life and its role in meeting modern day chal-lenges. We at Tata Chemi-cals believe that chemistry is fundamental to the sus-tainable development of human society and this is in line with our mission of Serving Society through Science.”

R. Mukundan

Managing Director, Tata Chemicals



Article The Indian philosophy sets it goals beyond this world transforming our lives even in the next birth and this is where it differs from the philosophy propagated by the western world.

09

CSR and Wisdom from Ancient IndiaBy Enakshi Sengupta & Vijay Kapur

Vijay Kapur & Enakshi Sengupta are the Executive Directors of Kohana – A dedicated CSR Con-sultancy (www.kohanacsr.com). They bring with them both academic and practical experi-ence in the �eld of CSR.

The contemporary concept of Corpo-rate Social Responsibility became

popular in India less than a decade ago. CSR along with other management the-ories has been dominated by western theories which happened due to colo-nization and widespread use of English in many countries. When one digs a bit deeper one can �nd that concepts and management theories popularised by the western world have been in use in In-dia for centuries, long before it was codi-�ed by European thinkers. Sharma (2001) explains that in order to gain success by e�ective use of a management concept it has to emerge from the soil of that region, �rmly rooted to its own culture. Hence many countries have now taken the endeavour to look back at their own ancient scriptures and explore their own system of management and CSR.

Practice of CSR can be traced back to the ancient civilization in Greece (Eberstadt 1977). A similar development of CSR took place in ancient India which was based on the teaching of Vedas (Pandey and Tri-pathi 2002). The onus of CSR in ancient India was bestowed to the king (Rig Veda 1-8), which emphasized the role of a king as an accumulator of wealth and the use of his wealth for the betterment of his stakeholders or subjects. In return the king would be blessed by his subjects to grow and shine like a sun. The impor-tance of a leader and his role in society as a protector and a giver was also stressed by Sri Krishna in the Bhagvad Gita and the same opinion was voiced by Manu and Shukrachrya. The Manusmriti states that a country reaches a state of lawless-ness and chaos without its king as the king is the messenger of God on earth to protect and look after his subjects. In today’s world the state and then the �rm is expected to replace the king and be-come the benefactor of society.

Indian philosophy is deep rooted in the concept of Dharma or virtue. Dharma as explained by Radhakrishnan (1929) forms the basis of all social and moral values practised by an individual or so-ciety. Taittiriya Upanishad instructs all individuals to speak the truth (satyam vada) and then to practice virtue (dhar-ma cara). Dharma has been the guiding light to right living and stability in soci-ety. The other concept that is expected to guide individuals in India is the concept of Karma (cause and e�ect). The concept of Karma implies that the present state of an individual is determined by their ante-cedent actions. Hence the law of Karma along with virtue or Dharma forms the basis of self-realization.

The Indian philosophy sets it goals be-yond this world transforming our lives

even in the next birth and this is where it di�ers from the philosophy propagated by the western world.

The teachings in the four Vedas, name-ly, Rig Veda, Yajur Veda, Sama Veda and Atharva Veda form the fundamental ba-sis of human life on earth. The Rig Veda particularly states that the cosmic order is governed by the physical relationship of man to moral laws. Swami Dayananda classi�ed the Rig Veda into four orders (Rig Veda 10-09-9). The �rst order is that of ‘Gyana’ or transcendental knowledge of absolute truth of God. The second or-der is action or ‘Karma’. The third order is ‘Upasana’ or worship and the fourth or-der is ‘Vigyan’ or science which is the all-encompassing body of knowledge.

Vedic knowledge propagates that right moral practice couple with knowledge and right action leads to business excel-lence and a balanced life. Sri Krishna in the Bhagvad Gita stated that “value sys-tem protects you if you follow it” (dhar-mo rakshati rakshaitaha). Swami Vive-kananda in his teachings and re�ection of the Bhagvad Gita also states that the basis of the social and political system in a country rests on the goodness of man-kind. While accumulation of wealth is encouraged in ancient scriptures, it also proposes the right action on the use of wealth that is on self and on donation for the welfare of others. It has been ex-plicitly stated that whatever is given to others sel�essly comes back to the giver in many folds (Rig Veda 1-8). Business is viewed as an integral part of society; it should create wealth for society through right means of action of “sarva loka hi-tam” or well-being for all stakeholders. Vedic literature while talking about busi-ness states:

“May we together shield each other and may we not be envious towards each other. Wealth is essentially a tool and it continuous �ow must serve the welfare of the society to achieve the common good of the society.” (Athar-va Veda 3-24-5).

Sri Krishna in the Bhagvad Gita (3-13) has said that all sorrows from society would be removed if socially conscious members of society enjoy remnants of their work in creating sel�ess welfare to others (Muniapan 2007).

When we summarize the teachings of Ve-das and Bhagvad Gita we �nd that these teachings advocate that business excel-lence should be weaved around spiritu-alism and is grounded in the concept of self-determination and self-realization. Secondly business should follow right actions and right measures and should be virtuous.

Thirdly business should accumulate wealth through right actions Karma and wealth should be shared equally with all stakeholders.

Finally business can only achieve excel-lence if business practices are ethical and socially responsible. If one reads the Arthasashtra we �nd that Kautiliya while mentioning the duties of a king, akin to a business leader of today’s world, he men-tions, that the king should have no self-interest but his satisfaction should lie in the welfare of his people and is summed up in the line “bahujana sukhaya bahuja-na hitayachya” – the welfare of many and happiness of many. In the Shantiparva of the Mahabharata, the public interest is to be accorded precedence over the lead-er’s interest. Kautiliya lays down three mian responsibilities of a leader which are ‘Raksha’ (security), ‘Palan’ (Growth) and ‘Yogakshma’, which means welfare. Kautiliya also stressed the happiness of all stakeholders not only by wealth and pro�t but by doing the right things “sukhasya moolam dharma”.

The knowledge that exists in our ancient scriptures gives us the direction towards a better society and towards creating happier and healthier stakeholders. The teachings in the ancient scriptures bor-ders on ethics and stakeholder manage-ment. Italso forms the basis of a good hu-man being who believes in conducting his work in a right and virtuous way re-sulting in the welfare of his stakeholders.

Reference:

• Eberstadt, N.N. (1977)‘What history tellsus about corporate responsibilities’, in A.B. Carroll(Ed.), Business and Society Review (Autumn) in Managing Corporate Social Responsibilities.Boston, MA: Little, Brown and Company.

• Muniapan, B. and Shaikh, J. (2007) Les-sons in Corporate Governance from Kautilya’sArthashastra in Ancient India, World Review of Entrepreneurship, Man-agement andSustainable Development (WREMSD). Special Issue on: “Accounting StandardsConvergence, Corporate Gov-ernance and Sustainability Practices in East Asia”, Vol. 3,pp.50–51.

• Pandey,R.K.andTripathi,P.S.(2002)‘Vedicvalues and corporate excellence’, in S.C. Dhamijaand V.K. Singh (Eds), Vedic Values and Corporate Excellence (pp.168–171). Uttaranchal,India: Gurukul Kaugri Univer-sity.

• Sharma,G.D.(2001)ManagementandtheIndianEthos.NewDelhi, India:RupaandCompany.

• Radhakrishnan, S. (1929) Indian Philoso-phy: Volume 1 (2nd ed.). London, UK: George Allen andUnwin.

The importance of a leader and his role in soci-ety as a protector and a giver was also stressed by Sri Krishna in the Bhagvad Gita and the same opin-ion was voiced by Manu and Shukrachrya.

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‘‘



News Google wants to shine a spotlight on the many Indian non-profits working to help solve some of the world’s most pressing challenges.

10

CSR of Coal Companies, 80% Budget to be Spent in Local AreaNEW DELHI : The Department of Public Enterprises

(DPE), had framed the CSR guidelines, based on which, Coal India Ltd. (CIL) formulated a Corporate So-cial Responsibility (CSR) policy and provided funds to the tune of 5% of retained earnings of previous year subject to minimum of Rs. 5 per tons of coal production for subsidiaries & 2.5% for CIL. The criteria for spend-ing funds under CSR. cover the economically backward and needy section of the society living in di�erent parts of India. For Carrying out CSR activities, 80% of the budgeted amount should be spent within the ra-dius of 25 km of the projects or mines and 20% of the budget would be spent on CSR activities within the State or States in which the Subsidi-ary companies are operating. For CIL (HQ) CSR should be broadly executed in the areas, which are beyond the jurisdiction of subsidiary com-panies. This information was given by the Minis-ter of State for Coal, Pratik Prakash Bapu Patil in a written reply in Lok Sabha on August 13, 2013.

Minister said that as per CIL’s CSR policy, the na-ture of work on which CSR funds are being uti-lized include Education, Water Supply including drinking water, Health care by providing Indoor medical facilities and medicine, Sports and cul-ture, Social Empowerment, Infrastructure for Village Electricity, Solar Light, Pawan Chaki. Etc., Generation of employment & setting up Co-op-

erative Society, Infrastructure Support, Heritage sites in the CSR purview ensuring involvement of em-ployee’s representatives in this Project, Empowerment of women for education, health & self-employment, Adoption of village for carrying out the activities like infrastructural development e.g. road, water sup-ply, electricity and community center etc. The details of amount utilized during last three years for the devel-opment of the surrounding villages by CIL & its subsidi-aries is given below.

Minister further said that the Department of Public Enterprises (DPE) had framed the CSR guidelines in 2010 and as per CSR policy, the budget allocation for CSR increased tremendously. However, the CIL and its subsidiaries were not geared to utilize the funds within the �nancial year commensurate with higher allocation. Besides, the CSR projects are to be imple-mented by specialized agencies. In order to quantify the impact made by CSR activities, baseline data had to be compiled by conducting baseline survey before start of a project. The above formalities took time re-

sulting in slow utilization of funds. However, the unutilized fund for 2011-12 was carried over to the next �nancial year. Further, CIL has taken measures to step up utilization of CSR funds in the current year. A separate Cell in CIL, HQ. as well as its subsidiaries has been established under senior level executives of the Company. For monitoring of CSR activities the Committee comprising of Board Level Directors have been formulated at CIL, H.Q and its subsidiaries sepa-rately. CIL has entered into a Memorandum of Understanding (MOU) with Tata Institute of So-cial Science (TISS), A National CSR Hub for ex-tending assistance in implementing CSR activi-ties for CIL and its subsidiaries.

Company 2010-11 2011-12 2012-13 2013-14 (Up to June) (Fig in Rs.

Crs.)

ECL 04.74 13.14 09.42 0.35

BCCL 03.15 05.53 07.43 01.73

CCL 10.98 11.00 13.66 02.08

WCL 07.12 07.85 20.96 02.33

SECL 15.70 17.66 46.63 14.71

MCL 53.45 14.47 25.56 17.19

NCL 04.35 09.25 17.64 03.84

CMPDIL 00.19 00.49 01.06 0.00

CIL & NEC 08.71 02.59 07.19 53.13

Total 108.42 82.00 149.55 95.36

Google Launches Rs 12 cr Hunt For India’s Best Innovative Social Entrepreneurs

NEW DELHI: Google has launched the Google Impact Challenge in India,

asking Indian non-pro�ts how they would use technology to tackle problems in India and around the world. The four submis-sions judged to be the best will each re-ceive Rs 3 crores and technical assistance from Google to help make their project a reality.

On the eve of India’s independence, Goog-le is celebrating the spirit of creativity, di-versity and entrepreneurship that are the hallmarks of the world’s largest democra-cy, by enabling the best local non-pro�ts that are using technology to make the world better, faster.

Applications open today and Indian non-pro�ts are invited to apply online by Sep-tember 5, 2013 at:g.co/indiachallenge. A team from Google will review applica-tions and announce 10 �nalists on 21st October. The public will then be invited to learn more about the top 10 �nalists and cast a vote for their favourite projects. The �nal event, to take place on October 31, 2013, will feature a judging panel includ-ing Google board member Ram Shriram; Google’s Chief Business O�cer, Nikesh Arora; Jacquelline Fuller, Director, Google

Giving; Anu Aga, Social Worker and for-mer Chairperson, Thermax and Jayant Sinha, Managing Director, Omidyar Net-work India Advisors, who will select three awardees. The fourth awardee, based on online votes from the public, will also be revealed.

In addition to backing Indian social inno-vators, Google wants to shine a spotlight on the many Indian non-pro�ts working to help solve some of the world’s most pressing challenges. This is Google’s �rst Challenge in India and only its second overall.

Google’s Global Impact Awards support entrepreneurial non-pro�ts using technol-ogy to tackle some of the world’s toughest problems. Previous awardees have devel-oped projects ranging from technology that allowed under-privileged students to access maths and science education to real-time sensors that help ensure people have better access to clean water.

This is also part of Google’s ongoing giving e�orts. Every year Google gives away approximately $100 million in grants, $1 billion in free and discounted apps and ads, and 50,000 employee volunteer hours around the world. In 2012, Google launched the Global Impact Awards to support entrepreneurial non-pro�ts with a tech idea for how to change the world.

“We are thrilled that the Google Impact Challenge is launching in India. It is a great opportunity for Indian non-pro�ts to scale their e�orts to help solve some of our tough-est problems. India already has a rich tradition of corpo-rate giving and hopefully the Challenge will galvanize social entrepreneurship in India.”

Rajan Anandan

Vice President and Managing Director, Google India

“I have had the privilege of working with budding in-ventors for many years, and I know India’s entrepreneurs are some of the biggest and boldest thinkers in the world. Today I’m thrilled to be part of a new tech-oriented, venture model that will support our country’s amazing engine of social entrepreneurs, identify-ing and backing the best tech-nology ideas to improve the lives of millions.”

Ram Shriram

Judge and Google board member



Success Story Vedanta has so far formed more than 1180 such Self-Help-Groups and the company is further scaling up the project to bring in more rural and tribal women so that they can be socio- economically empowered.

11

Women Entrepreneurs of Rural IndiaRural women out to make mark in Indian market with their art and craft through Vedanta Self-Help-Groups

A tribal woman of Lanjigarh, Kada Majhi from village Kinari who has been trained by Vedanta in stitching and tailoring sends her children to DAV Vedanta International School now. Vedanta also provided her a sewing ma-chine and now she is able to earn about Rs. 2000 pm. In Lanjigarh area itself, 260 tribal women have been trained in various skills.

Most of these rural wom-en were illiterate. Ve-danta arranged their adult-education class-

es in the villages to make them capable of maintaining itinerary of their own products. Initially, Vedanta’s team helped them in linkages but a situation has come when these women have become independent and they handle their ledger book and accounts with banks themselves. Shahnaz is one of the 14,870 rural and tribal women who have been able to support their families by joining Vedanta’s SHGs.

A tribal woman of Lanjigarh, Kada Ma-jhi from village Kinari who has been trained by Vedanta in stitching and tailoring sends her children to DAV Vedanta International School now. Vedanta also provided her a sewing machine and now she is able to earn about Rs.2000 pm. In Lanjigarh area itself, 260 tribal women have been trained in various skills.

Tamil Nadu is also not behind. Lalitha from the state says, ‘I and my mother and sister are members of Jasmine self-help-group (SHG) and had in-terest in saree decoration skills, like embroidery etc. and Vedanta be-sides providing training also linked us with the local textile shops. Now, we are able to earn about Rs. 4000 to 5000 pm. About 750 such women are working in various Self-Help-Groups formed by Vedanta Group company MALCO in Tamil Nadu.

In Tuticorin where Vedanta has cop-per plant, Juliet Suganthi showed interest in painting work. She joined

‘Nachithiram SHG’ and went for train-ing in fashion jewellery. She now makes chains, necklace, rings and other items to sell in the market.

Similarly, Shanti Kanwar of Chhat-tisgarh is a member of ‘Sarvmangla SHG’ formed by the group company BALCO. Shanti has been linked with rice milling and �our making unit. Girja Saarthi, a member of ‘Mahama-ya SHG’ is engaged in paper plate making unit. Girja says, ‘we started getting orders for our product from the day we started operating the unit. BALCO, besides forming our group also gave us �nancial support and helped us getting the orders. Now, we are directly linked with mar-ket.’ Like Girja and Shanti, about 325 women are working in various SHGs and earning about Rs. 5000 pm.

Not just in India, in the States of Ra-jasthan, Chhattisgarh, Tamil Nadu, Goa and Orissa, Vedanta has organ-ised Self-Help-Groups even in Zam-bia where the group has Konkola Copper Mines.

A number of NGOs across India and banks like HDFC, Indian Bank, Indian Overseas Bank, State Bank of Bikaner and Jaipur and State Bank of India have come forward for providing �-

nancial assistance to the members of Self-Help-Groups.

Vedanta has so far formed more than 1180 such Self-Help-Groups and the company is further scaling up the project to bring in more ru-ral and tribal women so that they can be socio- economically empow-ered. Today, these women are busi-ness women of rural India and are out to make mark in Indian market

with their art & craft and their skills in handicraft, embroidery, terracotta, tailoring, saree decoration, jewelry making, mushroom cultivation, poul-try, goat husbandry, pu�ed rice pro-cessing, leaf plate-making, �sh-farm-ing, phenyl making, incense sticks/agarbati making, beauty parlor, typ-ing institute, gold covering, oil sales, birds rearing, to name a few.

State Company Rajasthan Hindustan Zinc Chhattisgarh BALCOOdisha Vedanta Aluminium LtdTamil Nadu MALCO, Sterlite Copper Goa SESA GoaZambia Konkola Copper Mines

When Shahnaz Hussain lost her hus-band 15 years ago, her life had come to a standstill. The thought of com-pleting education of her 2 children and sustaining respectable livelihood almost dragged her into depression. This simple house-hold woman of village Bichhdi in Rajasthan had no �nancial support and the future looked uncertain. Speaking to fellow women of her village, for her sustain-able livelihood, she came in touch with a Self-Help-Group ‘Jai Hind’ a women empowerment project by Ve-danta Group in rural India. Shahnaz joined the group and was provided stitching and tailoring training by Ve-danta Group Company in Rajasthan, Hindustan Zinc. Her determination to get her children educated and have a sustainable livelihood made her an active member of the group.

Women in rural and tribal India live a life that requires social and economic upliftment. As the women are core of family system in India, it is important for the rural society, like in urban so-ciety, that she should not only be ed-ucated but also socially and econom-ically empowered. With this thought, Anil Agarwal’s Vedanta Group started Self-Help-Groups in rural India in 2006. Each Self-Help-Group needed to have about 10-15 women who would be provided relevant training according to the needs and interest and would be linked with market for selling the products and also with banks for �nancing the raw material.

Women in rural and tribal India live a life that requires social and economic upliftment. As the women are core of family system in In-dia, it is important for the rural society, like in urban society, that she should not only be educated but also so-cially and economically empowered.

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‘‘“The larger challenge has been to convince the rural women to spare time and join the groups. The rural system has its own chal-lenges in terms of the social system. The support of family mem-bers for the women becomes the vital point. Vedanta group rep-resentatives need to convince not just the women in question but also the family members and make them understand as how her empowerment will bring prosperity to the entire family as well. Once they came together, they started working like a strong team where they extended helping hand to each other and ensured their SHG comes out with best of products.”

Pavan Kaushik,

Head - Corporate CommunicationVedanta Group



Article The purpose of the corporation must be redefined as creating shared value, not just profit per se. This will drive the next wave of innovation and productivity growth in the global economy. It will also reshape capitalism and its relationship to society.

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The Corporate Paradigm Shift for Creating Shared Values

The concept of Corporate Social Responsi-bility has been debated for years. The gen-eral understanding of policy makers is that every �rm must ensure a balance between business and society. With the increasing re-sponse of the shareholders towards the un-derlying business philosophy, Corporate So-cial Responsibility is today being considered as the commitment of business to contrib-ute to sustainable economic development, working with employees, environmental re-sponsibility, local community and society at large to add value in all spheres of in�uence.

Over the years, the stakeholder engage-ment with the business and by the business has grown substantially, making business to e�ectively engage all signi�cant groups of stakeholders ensuring smooth business op-erations.

Moreover, changes in the global context catalyzed the chain reaction for taking cor-porate responsibility to a new level. Moving

from the era of Milton Friedman who has de-�ned the subject as “the social responsi-bility of business is to make pro�ts”, to the age where businesses across the global are professing organiza-tional culture devel-opment for creating shared values, both businesses and the so-called concept of CSR have witnessed evo-lution hand-in-hand. Precursored by merely pro�t-making rapid industrializationto the stage of obtaining the lisence to operate through charity to the present times of corpo-rate advancement to-wards creating shared values, “CSR” has trav-elled through various experimental stages of evolution.

Moving Beyond Trade-O�sBusinesses and society have been pitted against each other for too long. In this jour-ney of responsible evolution of businesses, various schools of thoughts have played signi�cant roles.Pro�t- centric group of economists have legitimized the idea that to provide societal bene�ts, companies must temper their economic success. In neoclassical thinking, a requirement for so-cial improvement—such as safety or hiring the disabled—imposes a constraint on the corporation. Adding a constraint to a �rm that is already maximizing pro�ts, says the theory, will inevitably raise costs and reduce those pro�ts.

A related concept, with the same conclu-sion, is the notion of externalities. Externali-ties arise when �rms create social costs that they do not have to bear, such as pollution. Thus, society must impose taxes, regula-tions, and penalties so that �rms “internal-ize” these externalities—a belief in�uencing many policy decisions.

This perspective has also shaped the strat-egies of �rms themselves, which have largely excluded social and environmental considerations from their economic think-ing. Firms have taken the broader context in which they do business as a given and resisted regulatory standards as invariably contrary to their interests. Anything more is often seen by many as an irresponsible use of shareholders’ money.

Blurring the Pro�t/ Nonpro�t BoundaryThe concept of shared value, in contrast, recognises that societal needs, not just con-ventional economic needs, de�ne markets. It also recognizes that social harms or weak-nesses frequently create internal costs for �rms—such as wasted energy or raw ma-terials, costly accidents, and the need for remedial training to compensate for inad-equacies in education. And addressing soci-etal harms and constraints does not neces-sarily raise costs for �rms, because they can innovate through using new technologies, operating methods, and management ap-proaches—and as a result, increase their productivity and expand their markets.

Creating Shared Values

The corporate pandits have de�ned the concept of Creating Shared Values in varied forms but the most preferred de�nition lies in developing a system of inclusive business models.

A growing number of companies known for their hard-nosed approach to business have already embarked on important ef-forts to create shared value by reconceiv-ing the intersection between society and corporate performance. Yet our recognition of the transformative power of shared value is still in its genesis. Realizing it will require leaders and managers to develop new skills and knowledge—such as a far deeper ap-preciation of societal needs, a greater un-derstanding of the true bases of company productivity, and the ability to collaborate across pro�t/nonpro�t boundaries. And government must learn how to regulate in ways that enable shared value rather than work against it.

Capitalism is an unparalleled vehicle for meeting human needs, improving e�cien-cy, creating jobs, and building wealth. But a narrow conception of capitalism has pre-vented business from harnessing its full po-tential to meet society’s broader challenges.

The moment for a new conception of capi-talism is now; society’s needs are large and growing, while customers, employees, and a new generation of young people are asking business to step up.

The purpose of the corporation must be rede�ned as creating shared value, not just pro�t per se. This will drive the next wave of innovation and productivity growth in the global economy. It will also reshape capital-ism and its relationship to society. Perhaps most important of all, learning how to cre-ate shared value is our best chance to legiti-mize business again.

The Evolving Corporate BehaviorCorporates all over the globe are gradually evolving from the typical mindset of doing mere philanthropy on the name of CSR to the value added approach of have program-matic outlook towards the business case of CSR. This approach endeavors to create val-ues shared by not only business and busi-ness associates but also by the society at large.

Besides this, the increasing trend of Adver-tising CSR amongst stakeholders is a true catalyst for the evolving corporate behavior towards CSR. Now, companies do not want to show case the ‘good work they do’ as an extended responsibility towards society but understanding the stakeholder expecta-tions CSR is now advertised as a pure case of ‘Shared Value Proposition’. The recent devel-opment at the government front has further added fuel to this trend.

The Ripple E�ect towards Inclusive GrowthMore and more companies are now evolv-ing from the narrow view of value creation and are taking the lead in bringing business and society back together. The recognition is there among sophisticated business and thought leaders, and promising elements of a new model are emerging. Yet we still lack an overall framework for guiding these ef-forts, and most companies remain stuck in a “social responsibility” mind-set in which societal issues are at the periphery, not the core.

The solution lies in the principle of shared value, which involves creating economic value in a way that also creates value for soci-ety by addressing its needs and challenges. Businesses must reconnect company suc-cess with social progress. Shared value is not social responsibility, philanthropy, or even sustainability, but a new way to achieve eco-nomic success and inclusive growth.

Akanksha Sharma is the Manager- CSR & Sustainability at Jubilant FoodWorks Lim-ited.

Capitalism is an unparalleled vehicle for meeting human needs, improving e�ciency, creating jobs, and building wealth. But a narrow conception of capitalism has prevented business from harnessing its full potential to meet society’s broader challenges.

Capitalism is an unparalleled vehicle for meeting human needs, improving e�ciency, creating jobs, and building wealth. But a narrow conception of capi-talism has prevented business from har-nessing its full poten-tial to meet society’s broader challenges.

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By Akanksha Sharma



Article If you plan to develop a purpose-driven social brand and do a lot of cause-marketing, then develop a policy which deals with many of the above issues. 13

Cause-Related Marketing:

The Right Direction ?By Monaem Ben Lellahom

In their ever increasing need to dif-ferentiate themselves, many compa-nies are turning to the use of cause-related marketing. Decades ago, if

you dropped the phrase “cause-related marketing” in the meeting room, your colleagues would most likely return an empty stare.

Historically, “Market-ing 1.0” was a product-focused enterprise born of the Industrial Revolution, and “Mar-keting 2.0” was a cus-tomer-focused e�ort leveraging insights gained from informa-tion technology, and now with “Marketing 3.0”, Philip Kotler came to con�rm that mar-keting’s latest incar-nation must engage people in ways that provide “solutions to their anxieties to make the globalized world a better place”. It is a giv-en fact that consum-ers believe companies have obligations be-yond making money for their owners. In fact, it is getting more di�cult for a company to connect with cus-tomers and prosper if

it does not stand for something more than its �nancial bottom line.

Consumers Prefer CausesThe 2013 Cone Global Cause Evaluation Sur-vey shows that 55% of surveyed customers have boycotted a company because of ir-responsible business practices. 53% would NOT invest in a company that does not ac-tively support a good cause.

When choosing between two companies with similar products that engaged in cause marketing, 70% of those surveyed cited “personal relevance of cause” as the reason they chose one company over another. On another note, 76% think it is ok for brands to support good causes and make money at the same time.

According to a new research presented at

the World Federation of Advertisers’ annual conference in Brussels, global marketers sur-veyed overwhelmingly said that CSR will be increasingly important in building brands in the future, with 88% agreeing with that state-ment. However, only 46% of those marketers thought that consumers share and approve their support for good causes. When in fact 60% of consumers surveyed claimed to be looking for brands with a sense of purpose.

Companies are asking the following ques-tions every day: Should we stand for a pur-pose or continue doing traditional market-ing? How do we optimize our purpose-driven marketing investments? Can being socially responsible be used as a messaging strategy in our marketing campaigns to help increase revenue?

American Express Starts a TrendThe concept of cause-related marketing was �rst introduced in 1983 by American Express to describe its campaign to raise money for the Statue of Liberty’s restoration. American Express donated one cent to the restoration every time someone used its charge card. As a result, the number of new cardholders grew by 45%, and card usage increased by 28%. Nowadays, there is an increasing num-ber of companies introducing marketing activities involving corporate e�orts of busi-ness and non-pro�t organizations for mu-tual bene�t. The market is seeing a �ooding number of new collaborations between cor-porates and NGOs in which their respective assets are combined to create shareholder and social value.

Businesses and Nonpro�ts Must Align Their StoriesIf you have ever purchased a product or ser-vice and felt good about it because it had a little pink ribbon or a sustainability label on it, you have likely been a consumer of a cause marketing campaign. We have totally changed the way we live our commercial lives; we now invest more of our minds, hearts and spirits. We keep searching for so-lutions that bring value to us and let us feel that we have a purpose in life. “Marketing 3.0 will be won by those who become purpose-driven social brands” explains Philip Kotler in Marketing 3.0: From Products to Custom-ers to the Human Spirit, and to do so, busi-nesses and non-pro�ts must align to bring a

cohesive brand story to life. Companies are increasingly turning to purpose-driven mar-keting with the hope of cultivating loyalty among their key customers. Sure, consum-ers are happy to help save the world and be more responsible. But they must �rst see the bene�t to their own households. When going through the process of developing purpose-driven social brands, companies have to make sure that there is a win-win sit-uation between customers and the charity. This is achieved when customers feel their livesare enhanced by the charity e�orts and that good feeling is transferred to how they feel about the market.

Cause Marketing: The Right Direction?Despite compelling data however, lots of businesses are still indecisive on whether it is the right direction to take and whether is it the right time to start investing. “As mar-keters, we spend billions of dollars each year trying to understand consumers all over the world. Unfortunately, it is harder and harder” Edward Martin, Director Marketing Excellence and CSR Insights at The Hershey Company. Therefore, it is time to understand that only a minority of customers take time to answer marketing surveys and ads. How-ever, customers are more willing to engage with companies on social causes and envi-ronmental issues. It is not a good way to get into the customers’ minds? Try it once and you will see the immediate result.

Peter Ducker once said, “Pro�t is not the purpose of a business but rather the test of its validity.” I will take that a step further: The real indicator of measuring the success of a sales force is not making pro�t. It is the test of its added value and e�ectiveness to the customer. We need to step back from our conventional practices and take a larger view of what connects us to build deeper bases for purpose-driven engagement.

However, in order for these e�orts to be ef-fective, customers must feel that your e�orts are authentic and truly supporting a cause. Businesses have to be transparent about how they are distributing funds to the cause and clearly outline the win-win solution the product or the campaign is preaching for. If you plan to develop a purpose-driven social brand and do a lot of cause-marketing, then develop a policy which deals with many of the above issues.

Peter Duckers Once said, “pro�t is not the purpose of a business but rather the test of its valid-ity.” I will take that a step further: The real indicator of measur-ing the success of a sales force is not making pro�t. It is the test of its added value and e�ective-ness to the customer.

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Monaem Ben Lellahom is a pioneer and thought leader in Corporate Sustainability and Responsibility (CSR) prac-tices in the Arab region. Monaem is co-founder and Head of Sustainability consultancy services at Sustainable Square Consultancy and Think Tank. He was the �rst Social Return on Investment (SROI) practitioner in the Arab world to master social impact measurement and has authored research reports to demonstrate the social value of community development work through SROI analysis. Monaem also focuses on developing sustainability strategies for organizations across various industries, conducting gap analysis and studying Socio-economic (SEIA) progress in various issues. He has extensive knowledge of Sustainable Value Chains and Product Transpar-ency, and the linkages between Sustainability and Branding.



Article For most organisations, the cost of reporting in accordance with GRI will go up in the short term, but will decrease over the long run because the new Materiality focus will lead to more effective reporting and better return on investment for organisations who take the time to do it properly.

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GRI G4 – Is it worth it?By Dwayne Baraka

Dwayne Baraka is a speaker, trainer and consultant in CSR and is expert in of corporate strategy. Mr Baraka’s back-ground in corporate law has given him a solid understanding of the in�uence that corporations have on society and his experience as Director at Business in the Community means his insights are grounded in practical imple-mentation. His consultancy, valueCSR, has a burning focus on the business case for CSR.

The G4 will be a challenge for many companies, but the chal-

lenges will bring a number of ben-e�ts: better embedded CSR, more engaging CSR reports and better re-turns from CSR investments.

In reviewing the latest version of the Global Reporting Initiative ( GRI), three important criteria stand out as competing for the attention of CSR pundits, investors and others who care about CSR: Transparency, Com-parability and Materiality.

TransparencyIncreased transparency means greater trust from readers of CSR reports. Previous versions of the GRI has increased trust in business through clearer reporting of issues that concern many stakeholders. But transparency doesn’t always mean that the most important issues are dealt with.

For many NGOs and other interested society groups, the G4 reaches a lot further into supply chains and lev-els of remuneration, and that seems likely to be welcomed. However, the G4 is likely to result in most compa-nies reporting on a smaller number of issues, which may frustrate some.

ComparabilityMaking reliable judgments on CSR information published is easier if reports are comparable. The com-mon set of GRI metrics means that information is often directly compa-rable between companies. The GRI has thus far helped them by giving a relatively ubiquitous framework.

The G4, in allowing companies to generally report on less metrics, will mean a decrease in comparability of CSR reports.

MaterialityMateriality is the degree to which the issues covered by a company are the most important ones. The GRI has probably muddied materiality waters until now.

The G4 has signi�cantly increased focus on materiality and especially on companies reporting how they derive their most important issues.

Transparency, Comparabil-ity, Materiality – FIGHT!

Each of the three areas are inherent-ly in con�ict with each other. A focus on Materiality will decrease compa-rability because it will reduce the number of metrics common across all companies. It also has potential

for reduction of overall transparency and comparability, because ‘non-material’ issues might not be includ-ed in a report. The SRI community is desperately trying to connect CSR to corporate performance and presum-ably welcome the help they will get in identifying the most important CSR issues for companies.

Companies have long argued that Transparency is all well and good, but that GRI compliance causes them to waste resources on issues that didn’t really matter. Conversely, many NGOs have argued that GRI compliance doesn’t go far enough – they want more information and further into the supply chain than GRI had previously delivered. As a general rule, transparency will not be useful for materiality, but will of-ten increase comparability.

An increase in Comparability gener-ally increases transparency, but may reduce the e�ectiveness of identify-ing the most material issues. Com-parability requires an exhaustive list of metrics or clear consensus for all concerned about what the compa-rable issues should be. Little consen-sus of that type exists, although GRI and SASB are trying to achieve sec-tor speci�c metrics.

G4’s focus on materiality will result in longer discussion of issues that matter the most. That will use more resources, but deliver higher quality outcomes. The return on resources invested in the G4 will deliver di�er-ent result to di�erent organisations.

Simple OrganisationsFor simple organisations, the G4 will probably result in shorter reports with a clearer focus. CSR Reports will reach deeper into the most impor-tant issues through the greater focus on impact and consequent reach into supply chains.

Complex OrganisationsFor complex organisations, we will probably see longer reports, be-cause they will need to discuss ma-teriality on a strategic-unit basis, which may mean di�erent issues need to be addressed based on vari-ation in business model, customer base and operational strategy. For some organisations, they will need to have multiple discussions of the same issue because of the di�erent operational contexts.

Controversial OrganisationsFor organisations which have con-troversial or signi�cantly detrimental impacts on society, they will prob-

ably su�er the worst of both worlds; having to fully disclose all GRI met-rics (due to expectations of certain stakeholders) and identify their most material impacts. Those organisa-tions are likely to bemoan the GRI changes because they will need to greatly increase the resources need-ed to meet their social expectations and conform to the highest GRI and disclosure standards.

ConclusionsThe focus on Materiality is a very good way to make the GRI relevant for the mid-term. It gives organisa-tions the chance and an excuse to re-vise their views on CSR and to work out more speci�cally what the argu-ments are for and against particular CSR measures. It is also likely to re-sult in more focus on performance targets and greater measurability. Many organisations have undera-chieved on those and I think the G4 will be a much needed shot in the arm.

It also increases the transparency of the most material issues, which has potential to bring the SRI and broad-er investment communities closer to business. It will also mean that more companies will talk about the �nan-cial return of CSR initiatives, just like they do in relation to other parts of their business. As a result, CSR pro-grammes will be better embedded and drive a new round of value crea-tion from CSR- thinking.

For most organisations, the cost of reporting in accordance with GRI will go up in the short term, but will decrease over the long run be-cause the new Materiality focus will lead to more e�ective reporting and better return on investment for organisations who take the time to do it properly. For organisations who try to fake the Materiality stu� (and there will be more than a few of those), they are probably in for a long-term increase in costs and run the risk of being targeted for lack of transparency and honesty and also of disenfranchising investors in the medium term.

In summary, the G4 will be easy for companies that have taken integrat-ing CSR into their business seriously (or who will do so now) but will in-crease overall costs for not much bene�t for companies that don’t.

Big companies have relied on GRI’s Reporting Standard to guide them when writing CSR reports. The latest version, G4, will change the re-porting game and make companies more aware of the commercial ben-e�ts of CSR.

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Dwayne Baraka blogs at www.dwaynebaraka.com/blog, where this article was �rst published.E-mail - [email protected]



Article The government responded with pleas to companies to maintain Bangladesh as their playground even as it did nothing to address factory safety or land supply for the garment sector in the 2013-14 budget.

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Bangladesh – The Difference Between Policy and ActionBy Radhika Mehrotra

Radhika Mehrotra : As an Analyst- Stakeholder Engagement at Solaron Sustainability Services Pvt. Ltd. since Oc-tober 2012, Radhika Mehrotra is responsible for incorporating Solaron’s proprietary ‘stakeholder engagement’ component of company research and rating services in Emerging Markets. A post graduate from the esteemed Tata Institute of Social Sciences (TISS), Mumbai, India, Radhika started out as a Research Intern at ATLMRI Research and Policy Advocacy Programme, Mumbai. She has also worked as a Product Head at the Centre for Monitoring Indian Economy (CMIE), Mumbai. She was instrumental in spearheading research and analysis for two of CMIE’s �agship databases.

There has been enough and more said on the Rana Plaza collapse and the absence of a regula-tory framework, poor corpo-

rate monitoring of large supply chains, cheap labor and the ensuing price wars between countries, contractors and la-borers; and of course consumer activ-ism. While all of these are valid causal factors, none are revelations. What stands apart this time, is that while ac-countability was accepted rather grudg-ingly by a majority of the global retail-ers found churning out the latest trends from the debris of the Rana Plaza, most wax eloquent about their sustainable endeavors in consistent annual reports.

The natural consequence is a compro-mise on worker safety. Data provided by the International Labor Rights Forum con�rms this with 1,800 worker fatali-ties recorded since 2005, all attributed to factory collapses and �res. The culmi-nation of this deep negligence was the Rana Plaza collapse in April 2013 where obvious structural faults were ignored so that daily production targets were uncompromised.

The government responded with pleas to companies to maintain Bangladesh as their playground even as it did noth-ing to address factory safety or land sup-ply for the garment sector in the 2013-14 budget. Meanwhile, the Bangladesh Garment Manufacturers & Exporters Association has stated over other things a rise in cost of production (mainly due to exchange rate �uctuations) that has marginalized incomes and logically led to a fall in compliance related spending.

Companies like Disney, Levi Strauss and Target are seeking to withdraw licenses while some are making amends.

PVH Corp and German retailer Tchibo have signed a binding agreement to ban sub-contracting at high risk facilities, �-nance renovations & �re safety training and make audit results available to the public. The much delayed Accord on Fire & Building safety has been signed by 40 major retailers and may �nally see the light of day. Clearly, the onus of dignity & safety of Bangladeshi labor rests on the responsible business practices of companies.

An analysis of H&M and Walmart, the largest buyers of garments manufac-tured in Bangladesh, reveals gaps in im-plementation and the liberty to default on commitments in a weak regulatory environment. H&M–With a presence in 43 countries, H&M has multiple sustain-

ability commitments including organic raw materials, stringent targets on wa-ter consumption and model factories in Bangladesh. For its 785 suppliers, H&M monitors factory compliance, provides training for suppliers & their workers and promotes social dialogue through multiple associations such as Better Work, the Fair Labor Association and the Fair Wage Network.

The company acknowledges second and third tier sub-contracting and states that its 148 ‘strategic partners’ who ac-count for 53% of production, can own and subcontract work to multiple fac-tories. The company has successfully conducted 2,646 audits till date for all its suppliers. Additionally, with a focus on Bangladesh, the company has provided more than 100,000 workers and middle managers with training in �re and safe-ty. Supplier factories are required to con-duct electrical assessment as well, with costs shared by the company.

Overall, the company states a collabo-rative and exhaustive system to ensure sustainability in its supply chain. How-ever, the scope of these exercises is lim-ited to �rst-tier suppliers. Only 58 audits covered second-tier suppliers.

Similarly, only 30 of 747 head audits and 28 of 1,779 follow up audits checked on second-tier suppliers. In Bangladesh, a majority of the 5,400 factories are sec-ond and third tier suppliers. Implemen-tation is negated by ground experiences as well.

In March 2010, structural faults led to a �re and 21 fatalities at the Garib & Gar-ib factory. The company had reported compliance with its ‘Code of Conduct’ and health & safety audits conducted �ve months prior concluded no serious drawbacks. Similar discrepancies in au-dit results and actualities emerged re-cently.

A factory owner in Ashulia who supplies exclusively to H&M stressed on com-plete compliance with �re and safety requirements, even as all �re exits were bolted shut. In May 2013, the company recon�rmed a satisfactory health & safe-ty audit for the unit.

Unfortunately for H&M, its operations in Cambodia followed suit. A factory col-lapse in May had the company absolve itself of responsibility citing unapproved sub-supplier linkages; surprising, since Cambodian workers have been striking since 2012 against inadequate wages and poor conditions of work.

Wal-Mart- As the common link between the Tazreen Factory �re in November 2012 and the Rana Plaza collapse in April 2013, Walmart can no longer avoid addressing its health & safety norms. In both cases, the company was found to be operating from grossly unsafe facto-ries. In both cases, the company has dis-tanced itself from suppliers, citing the much abused complex subcontracting web. It continues to make its supplier policy more stringent – with limited ac-tion on its part. Walmart’s response to the two accidents directs accountability to the suppliers. From three chances ear-lier, suppliers will now face a ‘Zero Toler-ance’ policy regarding undisclosed sub-contracting. Statements from Walmart’s management circulating in media sources make the company sound like a victim of shoddy suppliers as opposed to an active stakeholder. Rajan Kamala-nathan, Walmart’s vice president of ethi-cal sourcing stated “We want the right accountability and ownership to be in the hands of the suppliers” and that “We are placing our orders in good faith.”

The company on its part failed to sign up to the Accord on Fire and Building Safe-ty. A shareholder proposal by a former Bangladeshi factory worker to comply with the Accord and ensure more trans-parent and timely action for its supply chain was voted down by the Board in June 2013.

Serious gaps mark the company’s per-formance as well. The Tazreen Factory was audited in May 2011 with ‘higher risk violations’ even as media reports point out that �ve licensers continued to source work to Tazreen in 2012. The Ethi-cal Sourcing Program document dated January 2012 has detailed guidelines that enable factories to comply with en-vironmental and social sourcing. Among other things, it directs suppliers to dis-close all factories and sub-contractors involved in the manufacturing process. Walmart then determines the scope and nature of audits. Costs are to be borne by suppliers, placing the �nancial and execution liability of sustainability on its suppliers. Further, Walmart’s disclosure processes are carried out on-line, guar-anteeing global access but not guar-anteeing coverage in poverty-ridden Bangladesh with internet access limited to only 3.5% of the population.

On 24 April 2013, an eight-story commer-cial building, Rana Plaza, collapsed in Savar, a sub-district in the Greater Dhaka Area, the capital of Bangladesh. The search for the dead ended on 13 May with the death toll of 1,129. Approxi-mately 2,500 injured people were rescued from the building alive. Bangladesh is the second largest garment exporter of the world after China, controlling about 20 per cent of the total US apparel import with a dra-matic share increase in the recent years.

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Interview The biggest drawback of our sector is the lack of regulation and organization. We work in an imperfect environment. Though the things are changing now but it will take some more time for them to be in perfect state.

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Education is the Key to Lead a Dignified LifeBy Santanu Mishra, Co-Founder & Executive Trustee, Smile Foundation

In an exclusive interview with CSR & COMPETITIVENESS , Santanu Mishra, Co-Founder Executive Trustee, Smile Foundation shared about his work and passion towards Social Venture Philanthropy (SVP) model.

Brief us about the historical background of Smile Foundation and its mission.

The realization of a group of young corporate profes-sionals, that it was their Social Responsibility to give back to the society, laid the foundation of Smile. In the early 90’s when liberalization happened, we were the �rst ones to get the fruit of success beyond expecta-tion. My needs were limited. The very thought of doing something beyond just professional gain haunted me always. I brought in a group of likeminded friends to start discussing what and how to do something which can impact maximum lives with our limited under-standing and resources.

What are the various social projects initi-ated by Smile Foundation in India?

Since 2002 Smile Foundation has been working on the subjects of education for children, livelihood for the youth, healthcare in rural villages and urban slums, women empowerment and sensitization of the privi-leged masses through programmes- Mission Educa-tion- the education programme for underprivileged children, Smile Twin e-Learning Programme (STeP) – the livelihood programme for underprivileged youth, SWABHIMAN- a Programme on girl child & women em-powerment and Smile on Wheels (SoW) – innovative mobile hospital programme.

How the project is serving the community?

Smile Foundation believes that education is the key to lead a digni�ed life. It enables an individual to be-come conscious about his rights, enables him to make informed choices. When we talk about empowerment it starts with education.

In our child education programme ‘Mission Education’ we focus on bringing the children to the remedial and bridge course centres, provide them an enjoyable and e�ective learning, avail them with basic healthcare and also nutrition. Most of the children come from parents who have never been to school. Hence the ba-sic awareness about the need to go to school is miss-ing. Secondly, they cannot take the �rst step towards school. So we need to sensitize and mobilize the whole communities for sending their non-school going chil-dren to our centres. Then comes making the children continue studying in the centres, learn e�ectively and then mainstreaming them into government and pub-lic schools. Today many of our children are studying in reputed schools across India.

What do you think of India govt emphasis on child education and rights?

Government no doubt is doing its best but everything cannot be left on laws and government alone. India is a big country with di�erent demographics. Government can make laws and bring acts like RTE but taking them to people cannot be done by government alone.

Right To Education (RTE) has provisions which can help in getting more and more children to school. But there is a major gap of awareness and enactment in terms of RTE. A majority of underprivileged population does not even know that there is something like RTE for them. For this civil society needs to be active to spread the reach and awareness of acts like RTE. The privileged section of our society should be proactive everything cannot be left on law or government alone.

The Smile Foundation calls itself a ‘Social Venture Philanthropist’ (SVP). Could you please elaborate a bit on that?

Social Venture philanthropy is one of the working model of Smile Foundation. It is based on the model of venture capital. Under the Social Venture Philanthropy (SVP) model, Smile Foundation identi�es handholds and builds capacities of genuine grassroots NGOs to achieve accountability, sustainability, scalability, lead-ership. Through the SVP model, Smile Foundation makes an e�ort to broad base investment in order to maximize its reach and optimize returns by approach-ing and strengthening a large number of like-minded individuals and organizations globally.

What is the motivation behind produc-ing child feature �lm “I am Kalam”. Kindly Share the achievement of the �lm.

‘I am Kalam’, was an astounding success with the �lm travelling to over 30 countries and winning 22 nation-al and international awards. With “I am Kalam” Smile Foundation advocated the cause of Sending Every Child to School. The story of a child daring to dream and surpassing the boundaries of reality won not just awards but accolades from the general audience across the world. With ‘I am Kalam’ we had stepped into the �lm genre. It sensitizes the civil society towards the plight of poor and their importance in helping them to lead a better life.

What are your future plans for the year 2013?

My future vision is to bring good and sustainable changes in lives of as many people as possible. Smile Foundation would like to develop and promote good governance in the sector more intensely in near future. Application of technology in achieving e�ciency and cutting cost would another area we are already work-ing and it would be developed further. Thirdly, sharing the learning and knowledge in real time with similar development organisations both in India and in simi-lar countries internationally would be something we would like to pursue further. Making the civil society members as partners in change in every developmen-tal initiative locally is another future objective.

What kind of challenges you are facing to implement to social projects?

In development sector, input is not always equal to the output. There are so many subjective processes and outputs which one needs to understand and appreci-ate.

The biggest drawback of our sector is the lack of regu-lation and organization. We work in an imperfect en-vironment. Though the things are changing now but it will take some more time for them to be in perfect state. In our country giving culture is not so inclined towards development work. So aligning people with resources and the needs have always been a challenge since the inception. This sector had been struggling with trust de�ciency so changing the perception of people is another major task which we face.

How do you measure Social Impact of the projects implemented?

Smile Foundation always believes in and follows good governance. We monitor our work both internally and externally. Internally we have an in bill process and a review is done on monthly, quarterly and annually ba-sis. Smile also engages external evaluators to under-stand, evaluate our programmes, methodology and the impact of our work. We not only get the evaluation done for our work internally and externally but also do course corrections and improvements in order to reach out to as many people as possible in a better way.

Social Venture philan-thropy is one of the work-ing model of Smile Foun-dation. It is based on the model of venture capital. Under the Social Ven-ture Philanthropy (SVP) model, Smile Foundation identi�es handholds and builds capacities of genu-ine grassroots NGOs to achieve accountability, sustainability, scalability, leadership.

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Smile Foundation works on the subjects of education, healthcare, livelihood and women empowerment through 158 projects operational across 25 states in India. Through the SVP model, Smile Foundation makes an e�ort to broad base investment in order to maximize its reach and optimize returns by ap-proaching and strengthening a large number of like-minded individuals and organizations globally.



Article The potential for big businesses to engage in the social delivery sector via social enterpris-es opens a huge opportunity for such businesses. 17

Innovation as Corporate Social Responsibility

The potential for big businesses to engage in the social delivery sector via social enterprises opens a huge op-portunity for such businesses. It will then be necessary for companies to identify the right sort of partnerships

and platforms, whereby the opportunity can be best exploited in the interests of sustainable development.

CSR or Corporate Social Responsibil-ity has been practised for many rea-

sons and does not necessarily provide bene�ts to society, or in fact even to the company. Money spent on various causes may well have been deemed to have ‘gone down the drain’ – the ac-tions funded often having but a tran-sient presence in the targeted audi-ences’ consciousness and in the world.

Internationally, the debate has moved from whether companies should un-dertake CSR to what they should do by way of addressing the need for business sustainability. In this context, CSR is thus perceived more as an act of self-preservation than of charity, and is focused on regulatory compliance – on environmental compliance, occu-pational health and safety standards, business ethics and corporate govern-ance – on the one hand, and active risk management via stakeholder engage-ment on the other.

In India, government has made it clear that it expects that all large companies will undertake activities that can be classi�ed as CSR. In other words, gov-ernment is making it mandatory for companies to pick up a part of the de-velopmental burden, especially while businesses experience growth and economic expansion. While this gov-ernment �at has mixed implications, the main negative implication being the undermining of the voluntary, unilateral and business-determined character of CSR, there are also some interesting and positive fall-outs. The main positive result is that companies are being gently nudged and prodded to take a serious look at (among others) innovation – as a business responsibil-ity.

Formulating CSR objectives in line with national development goals helps channelize otherwise sub-optimal resource-�ows into de�ned domains of national importance. Government has included traditional activities such as health and education in the ambit of CSR, allowing companies to con-tinue to perform charitable works in these areas, and claim the bene�ts of being CSR-compliant. However, by in-

cluding items such as social enterprise and technology incubation in the am-bit of CSR, government has de�nitely opened an important new channel to tap these funds. Government is urg-ing lethargic businesses to focus their attention on these two areas – which can be developed only by business enterprises. By de�nition, social enter-prises target important developmental objectives, but carry high risks as busi-nesses, because they serve people with lower paying capacity and are often based on untested business models. Often they are experimental in nature, small in scale and undertaken by indi-viduals with an idea but little else. In India, social enterprises have taken up all kinds of causes, from garbage seg-regation and recycling, to health ser-vices and skill-building, IT services and renewable energy.

Social enterprises routinely describe shortages of operating cash and dis-tributor and warehousing networks, lack of brand-image, inability to raise loans for their customers, and lack of business and marketing know-how as inhibitors of growth. Their last-mile focus is at odds with their scale-up aspirations. These are areas where as-sociation and partnership with large companies can be bene�cial.

Large businesses on the other hand increasingly recognise the rural sec-tor and social enterprise as a source of sustainable businesses and business models. They would like to be involved, but do not wish to invest heavily – both in terms of resources and shareholder attention. Incidentally, these concerns are also true of other types of CSR ac-tivities, except those which directly address the �rm’s business risks. Allow-

ing companies to ful�l their CSR obli-gations by investing and supporting these enterprises o�ers a tremendous opportunity for expansion of these so-cial enterprises and their impact and for �rms to legitimately direct some of their time and resources towards this important sector.

The potential for big businesses to en-gage in the social delivery sector via social enterprises opens a huge oppor-tunity for such businesses. It will then be necessary for companies to identify the right sort of partnerships and plat-forms, whereby the opportunity can be best exploited in the interests of sustainable development. Thus the op-portunity comes with a suitable chal-lenge. Business organisations shaping the sustainability agenda can play an important role in this regard.

Government has also indicated that investments in recognised technol-ogy incubators will be considered as execution of CSR. Engagement of the business sector in technology devel-opment has lagged in India, making us severely dependent on ideas and technologies and indeed products fashioned abroad. The underlying as-sumptions about the availability of en-ergy and resources including materials, land, water and labour, and about the end-uses would be di�erent when a product is conceptualised and built in industrialised societies, versus if it were to be conceptualised and developed from the start in India. Already certain large Indian companies are staking their claim in the innovation space – but it will be when there is �erce com-petition in this space -- and when that space becomes truly inclusive – that we will see real innovation. It is there-

fore heartening that the Companies Bill encourages companies to chan-nel their CSR spends into this domain, rather than pour it down the drain.

A sustainability challenge that cannot be met purely by market forces with or without regulatory support is the cleantech sector, as also BOP (bottom-of-pyramid) energy services. Another area that could do with infusion of additional funds and corporate atten-tion is that of indigenous products and services –e.g. indigenous architecture, using locally available materials and resources. Innovation is multiplied by inclusion. Thus the provision of suit-able rural/urban youth exchange pro-grammes and apprenticeships – is an area of great potential. Experiment-ing with new developmental concepts such as community-based sustain-ability standards – would be another interesting area for corporates who wish to have a window on the future. Channeling CSR funds towards a set of such activities would be to truly ful�ll the national and developmental vi-sion expressed in the provisions of the Companies Bill, while steering busi-nesses into strategic and forward look-ing pathways.

In sum, everywhere in the globe, CSR or more generally business respon-sibility has been recognised as be-ing closely linked to addressing social needs sustain ably. Without innova-tion, businesses cannot hope to be sustainable. The focus on innovation – via social enterprise and via technol-ogy incubation – in the Companies Bill is not a chance event. If businesses take this opportunity to switch their CSR focus from transactional and PR-led activities to strategic, risk-alleviating and option-generating activities, this would lead to the �ow of a substantial and much-needed fund into areas that will increasingly be critical for business sustainability.

Shailaja D Sharma is a sustainability specialist and an independent busi-ness and development consultant.

The focus on innovation – via social enterprise and via technology incubation – in the Companies Bill is not a chance event. If businesses take this opportunity to switch their CSR focus from transactional and PR-led activities to stra-tegic, risk-alleviating and option-generating activities, this would lead to the �ow of a substantial and much-needed fund into areas that will increasingly be critical for business sustainability.

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By Shailaja D Sharma



Social Innovation The purpose of the corporation must be redefined as creating shared value, not just profit per se. This will drive the next wave of innovation and productivity growth in the global economy. It will also reshape capitalism and its relationship to society.

18

Mahindru Foundation – Lighting up Lives of Visually Impaired

A journey that began almost a dec-ade back has lit up lives of thou-sands su�ering from corneal

blindness. In the year 2005, Y.P. Mahindru Niramaya Eye Bank and Cornea Trans-plant unit was set up at the Niramaya Charitable Trust, an NGO founded and run by a team of professionals. In 2004, Late Shri Yashpal Mahindru along with his son Ashok Mahindru guided a group of motivated professionals with experience in health and eye care to set up North India’s �rst and largest private Eye bank with a mission to provide ‘Quality Health Care to the Rural and Urban Poor”. It is the only government approved Eye Bank in South Haryana which is registered with Eye Bank Association of India. It follows standard world class procedures and is equipped with latest technology.

Ashok Mahindru leads these initiatives under the Mahindru Foundation (ear-lier known as Mahindru Charitable Trust) and provides �nancial support to various NGOs in eye care. The Trust is dedicated to enlarge the footprint of awareness campaigns for eye donation. The Founda-tion has been laid and now the plan is to bene�t the needy in the society. The eye bank is planning to open 50 eye banks across the country and provide free treat-ment for corneal blindness to people from economically weaker sections.

Y.P. Mahindru Niramaya Eye Bank pro-vides Cornea Transplants free of cost. Niramaya Charitable Trust runs 10 rural eye care centres to provide primary eye care. The transplants are carried out at the fully-equipped and reputed Ahooja Eye Hospital, Gurgaon. Mahindru Foun-dation has taken to wide awareness campaigns on eye donations, through carnivals, marathons, seminars, painting competitions, walk for vision event, etc. The foundation has dedicated its services to eradicate corneal blindness from the country and aims at creating: modern fa-cilities using best technology and equip-ment, extensive awareness about merits of eye donations and providing high quality medicare free of cost for the ben-e�ts of poor and under privileged. So far the foundation has received 7000 to 8000 eye donation pledges, and conducted more than 1200 corneal Retrieval and more than 400 cornea transplantations. The foundation has adopted professional strategies to achieve its objectives. The strategies include creating primary eye care and eye donation facilities jointly with like-minded NGOs at all cities with 0.5 million population, and setting up one integrated hub having 9-12 remote centres and the central unit with cor-nea processing facility attached to a full �edged eye hospital.

“We plan to open 50 eye banks all over India to ensure that corneal blindness is

completely wiped out from India,” Ashok Mahindru, who heads Y P Mahindru Eye Bank, said.

Y.P.Mahindru Niramaya Eye Bank Chair-man, Ashok Mahindru, says, “India is home to world’s largest visually impaired population. Around 1,20,00,000 peo-ple are su�ering from some kind of eye problem. 80 % of them are su�ering from cataract or refractive errors which are cur-able through a normal medical process.” “Remaining 2.1 million people are su�er-ing from acute corneal blindness that can only be eradicated through transplanta-tion of corneas from eye donor, which must be carried out within about 6 hours before one breaths his/her last,” added Mahindru.

Underlining the problem with regards to lack of eye donations, Ashok Mahindru said, average number of eye donations in India languishes at about 38,600 per annum implying that even an impossi-ble wait of 112 years will not help most. On the other hand approximately 9 mil-lion people die every year and one pair of eyes from a deceased person can be implanted on two blind persons imply-ing a potential of 1 Crore 80 Lakh corneal transplants.”

The major cause for this unfortunate situation is lack of awareness among our countrymen about eye donations, its need and life changing impact on entire families of cornea recipients who are able to see this beautiful world again. There-fore, there is an urgent need to raise awareness about eye donation. With the vision of working towards total eradica-tion of corneal blindness from the coun-try, the Gurgaon-based NGO – Y.P. Mahi-ndru Niramaya Eye Bank, under Ashok Mahindru, has crossed the milestone of 1000 eye donations in 2012.

Ashok Mahindru, who has carried for-ward his father’s dream initiative Y.P. Mahindru Niramaya Eye Bank. Many of

these corneas have been transplanted by AIIMS, Delhi and PGIMS, Rohtak (Hary-ana) through an ongoing collaboration.

On the occasion of their 1000th success-ful eye donation program, Ashok Mahi-ndru said, “The journey has not stopped here, rather it has just begun and I will urge my fellow citizens to enlighten someone’s world by donating your eyes.”

Founder of the Eye Bank, Late Shri Y.P.Mahindru, father of Ashok Mahindru, was a visionary philanthropist who be-lieved that one gets deep inner satisfac-tion and happiness when one gets physi-cally involved in philanthropy. Late Shri Mahindru had worked for health care for over 6 decades and had regularly organ-

ized free eye surgery/care camps for the under privileged. Ashok Mahindru has been taking forward his father’s vision by expanding the footprint through Run for Vision Foundation.

With a vision to reach out to many more and bring light in their life and family, Ashok Mahindru through his organiza-tion is relentlessly working hard to set up many more such eye banks.

Infact Ashok Mahindru is actively in-volved in other philanthropic initiatives also. Ashok Mahindru’s father Late Shri Y.P Mahindru was founder member of a school in 1959, named Arya Kanya Vidya-laya in Gurgaon. The school presently has 825 students most of them are getting free education, books & uniform as per the guidance of Ashok Mahindru.

Arya Veer Netra Chikitsalaya, committed to eye care, was started as a weekly dis-pensary and grew to become a daily one. Under the leadership of Ashok Mahindru, it has now become a full-�edged 12-bed hospital with an operation theatre. Nine doctors and other para-medical sta� per-form almost 1000 cataract and other sur-geries and 3000 OPDs in a year here.

With the vision of working towards total eradication of corneal blindness from the country, the Gurgaon-based NGO – Y.P. Mahindru Niramaya Eye Bank, under Ashok Mahindru, has crossed the milestone of 1000 eye donations in 2012.

“We Plan to Open 50 Eye Banks all over India

to ensure that corneal blindness is completely

wiped out from India.”

Ashok MahindruChairman,

Mahindru Foundation



Case Study The company has a well defined policy and a CSR committee consisting of senior members of the management to guide the CSR activities of the Group. 19

Skilling Ethnic Communities of Rubber Tappers of Tripura

Rubber Tapping Training Programme is running its third year and has Trained 315 Rubber Tappers.

A total of 13 training programme have been or-ganised till date, in which, 315 unskilled and semi skilled rubber tappers were trained. Cor-

porate Social Responsibility forms an integral aspect of DS Group’s business objectives. Taking this phi-losophy forward, the company has been executing a wide range of CSR programs on education, health, drinking water, empowerment and disaster relief. The Company believes that economic empowerment of individuals transforms them into powerful agents of social change.

DS Group has set up an ultra modern Heat Resist-ant Rubber Thread manufacturing plant in Agartala. This state-of-the-art manufacturing facility has an installed capacity of 5000MT per annum and has earned the status of a Mega Project from the state government. The opening of this plant, has given an impetus to the socio economic growth of the region

and a livelihood opportunity to more than 200 tribal families, by buying the latex they tap.

The Company has long term programmes running in Tripura to support the local communities through initiatives like school kits distribution and free DS Mo-bile Clinics. The company has also started a program on empowerment to train the unskilled and semi-skilled rubber tappers in scienti�c way of rubber tap-ping. This will increase the latex collection and the life of the rubber plants, which, in turn will contribute to high yields, thereby improving the lives of the tribal farmers.

The climate condition of Tripura is very favorable for growing rubber. Thousands of marginal / small farm-ers, who have 1-5 acres of tilla (undulating) land, have been planting rubber for the last few decades. As a re-sult large quantity of rubber is being produced every year and recently the state has been declared as the

second largest rubber growing state in India, next to Kerala. It is a cash crop, is a pro�table cultivation and gradually has become popular amongs the farmers.

It was however observed, that in Tripura, tapping de-creases signi�cantly during monsoon as the tappers are not aware of tapping techniques in rains. All this leads to less productivity and consequently less in-come for the tappers.

Tapping is a skilled job and the tapper should have su�cient technical knowledge about the science involved in the process, to do the job properly. But due to lack of proper scienti�c knowledge, maximum plants do not give adequate latex and gets damaged at a very young age.

Thus, DS Group decided to start a unique Training program for Rubber Tappers.

ObjectivesThe objectives of the programme are:

• To provide training to unskilled or semi skilled rubber tappers through well de-signed module

• To improve the socio economic status of rubber tappers from backward com-munities

• To increase the production of natural rubber (latex) through scienti�c rubber tapping in the state

LocationsThe training programmes were organised for the existing communities involved in rubber tapping or related activities. Following locations were covered in the �rst phase:

Location From To

Bhati Fatik Charra, Mohanpur Nov 19, 2011 Dec 17, 2011

Pepireakhola, Rajnagar Block, Belonia Dec 19, 2011 Jan 12, 2012

Tarapur, Hezamara Feb 12, 2012 March 12, 2012

Poangbari , Melaghar March 18, 2012 March 31, 2012

Harendra Nagar, Mohanpur April 18, 2012 April 30, 2012

In Second phase below mentioned locations has been covered.

Location From To

Sabar Colony Para of Bagafa, South Tripura July 22, 2012 August 10, 2012

Haripur, Motai GP, Hrishamuk Aug 22, 2012 Sept 10, 2012

Muja�ar Para, North Bharat Chandra Nagar, Ra-jnagar

Sept 14, 2012 Oct 5, 2012

Owangchara A.W.C Rajnagar Nov 3, 2102 Nov 25, 2012

Dhuptali Colony, Kakrabon, Gomati Dec 16, 2012 Jan 4, 2013

Devipur A.W.C, Hrishyamukh, South Tripura Jan 21, 2013 Febr 9, 2013

Background of ParticipantsThe training Programmes were organised for the existing rubber tappers to improve their skiils. A total of 315 trainees have been trained in the 13 training programs. De-tails of participants given below:

Age Group (in years) Total %

20 or less than 20 59 18.73

Between 21 to 30 154 48.88

More than 30 102 32.38

Total 315 100

Mostly participants are young; the average age is 27.83 years. Out of total partici-pants, almost 70% were below 30 years and many are from tribal and backward class-es. We ensure that at least 30% of the participants are Women.

Training Duration and contentAs per the Rubber Board Guidelines, 70 to 75 hours are required to complete the training on scienti�c rubber tapping. The following aspects were covered in the train-ing programs:

• Importanceoftrainingforscientificrubbertapping

• Identificationofplantsfortapping

• Introductionoftools&equipmentsfortapping

• Collectionoflatexandfurtherpreservation

• TappingmanagementduringtheMonsoonperiodandInjuredplantprotectionfrom several fungal diseases

• Visittorubberprocessingunit.

• Personalitydevelopment

Impact of First PhaseTotal 125 unskilled and semi skilled rubber tappers have been trained in �rst phase of the program.

DSGroupactivelyemployslocalsfromtheregionacrossdifferentlevelsandaimstogenerateemploymentthroughvarioussecondary&tertiaryoperations.DS Group has an ongoing programme to train the unskilled or semi skilled rubber tappers of Tripura. The basic objective of this initiative is to train the tribals and the unskilled tappers in scienti�c latex extraction to increase the rubber yield and minimize the damage to the rubber plant by teaching them precision in tapping. The curriculum also highlights the method of tapping rubber in monsoon season and protection of plants from fungal infections during rains by conducting theoretical and practical training programs with the help of the Rubber Board, TFDPC and TRTC.



Case Study Skilling Ethnic communities of Rubber Tappers of Tripura

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DS GroupDharampal Satyapal Group (DS Group) is a rapidly grow-ing multi-diversi�ed conglomerate, with a turnover of more than Rs 3300 crores in the �scal ending 2013. The Group has strong presence in F&B, Hospitality, Mouth Fresheners, Tobacco, Packaging, Agro forestry, Rubber Thread and Infrastructure. The most recent forays have been the Group’s entry into the Dairy, Confectionary and Powdered Beverages businesses. DS Group is com-mitted towards premium quality products & credited with several innovations over last eight decades.

Catch Spices, Catch Spring water, Catch �avoured water, Chingles-the mini chewing gums, Piyoz, Yomil- the one minute shake, Dairymax, Meetha Mazaa, Tulsi, Pass Pass, Rajnigandha, Tansen, Tulsi Saada, The Manu Maharani and Unitex are some of the leading brands the Group proudly shelters today.

DS Group constantly nurtures its responsibility as a committed corporate citizen by regarding Corporate Social Responsibility (CSR) as an integral part of its busi-ness objectives.

The company has a well de�ned policy and a CSR com-mittee consisting of senior members of the manage-ment to guide the CSR activities of the Group. Wide range of CSR initiatives ranging from education to health to safe drinking water and making tribal and eth-nic communities self reliant are being implemented on ground, all over the country. The Group works strongly on the principles of sustainability, dedication, resource-fulness and commitment.

An impact assessment was conducted to understand the outcome of the �rst phase of the program. A total of 62 participants were contacted out of the 125 trainees. The responses of the participants given below:

Occupation before the Training Program

Occupation Before Training

Labour related to rubber tapping 33

Farmer 4

Rubber Tapping 14

Home maker 4

Rubber Nursery 1

Unemployed 6

Total 62

Before attending the training 33 (53.2%) participants were garden labourers who used to support tapping activities only and 22.6% participants were involved in rub-ber tapping as primary occupa-tion.

After the training programme all the participants are working as rubber tappers. Of the total par-

ticipants, 88.7% of them are full time tappers (primary occupation is rubber tapping). Rest of the participants are also engaged in other aspects of rubber tapping business like managing nursery and latex marketing. The current graph shows the income of the participants. Before the training, the monthly income of the 59.7% participants were below Rupees 3000/- where as 9.7% participants were unemployed or involved in householdwork. After the training program, the monthly income of 70.9% partici-pants has become more than Rs. 4500 in a month while 21% participants are able to earn between Rs. 3000-4500 per month (part time engagement).

Present StatusThe company is continuing providing training program to the semi skilled and un-skilled rubber tappers. The third phase of the program started in June 2013. Below mentioned locations have been covered till date:

Location From To

Gamaibari, Kashia Mongal, Khuwai Tripura June 18, 2013 July 13, 2013

Devipur A.W.C ,Hrishyamukh R.D. Block July 18, 2013 August 14,2013

Further, the following locations will be covered in the current phase.

S. No. Location Block District

1 Laxmibil Bisalghar Sipahijala

2 Niharnagar Rajnagar South Tripura

3 Sarasima Hrishymukh South Tripura

4 Mirza Kakraban Gumati

“Rubber Tappers in the rural Northeast area are untrained as far as rubber tapping is con-cerned. Moreover, the plants are a�ected with diseases and the lifespan of the rubber plants were found declining. Monsoon is the ideal for taping rubber but majority of them failed to tap it because that had no training to do so. This training programme covers all aspects of scienti�c Rubber tapping and also teaches them a method to tap Rubber in monsoons. The socio economic conditions of the tappers has improved considerably as even the garden owners now prefer trained tappers who keep the trees safe , get maximum pro-duce and can tap rubber round the year.

Bhavna Sood, Senior Vice President Corporate Communications, PR and CSR, DS Group

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Article Earthquake, landslides, cloud-burst, flash-floods are not new to the people of Uttara-khand, but 16th June 2013, came as horror day for them, when thousands of people lost their lives in this calamity. It appeared as if Lord Shiva decided to intervene about the wrong doings taking place in his own land.

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12 Years of Uttarakhand Formation and 66 Days of Uttarakhand CatastropheBy Anil Jaggi

The memories are still fresh in my mind and I still remember the call from a friend in New York, informing me about the for-mation of new state “Uttarakhand”. It was

a moment of great happiness and ful�lment, not only for myself but the whole Uttarakhandi com-munity across the world. Every non resident Utt-arakhandi was excited and wanted to contribute towards the progress, prosperity and inclusive growth of the state. But gradually they realised that political leadership and bureaucracy are not concerned for equitable development of the state. Even they seemed ready to sell green cov-er of the state (65 % of total land area), natural resources (forest, rivers, minerals etc.) to become wealthy and powerful overnight. Ruling parties (BJP & Congress) did not take long in selling the thousands of water streams coming down from hills to greedy power sector companies. It all happened despite the regular protest from envi-ronmentalists like Sunder Lal Bahuguna, Chandi Prasad Bhatt, Prof. Agarwal and seers from all over India.

Ignoring the basics of sustainable, safe and green development, the policy makers were happily giving very rosy picture of development. Citizens could not understand that this all was fake development, while it is disastrous route for its habitats, biodiversity. They had aspired, fought and scari�ed their lives to get separate developed Himalayan state while protecting the nature’s blessings.

Earthquake, landslides, cloud-burst, �ash-�oods are not new to the people of Uttarakhand, but 16th June 2013, came as horror day for them, when thousands of people lost their lives in this calamity. It appeared as if Lord Shiva decided to intervene about the wrong doings taking place in his own land. Many families have lost their shelters and many villagers have lost the bread earners of their family.

Thanks to Indian Army, Indian Air Force, other paramilitary forces, local NGOs, CSOs and many more unsung heroes who helped 100,000 plus people get evacuated from there within few days. According to state government, 5748 peo-ple are still missing and more than 2500 mules were washed away. Many small villages/clusters are shaken badly and are not safe for further habitation. There is major loss of human life, live-

stock, agriculture, business activities and major loss of infrastructure in terms of road, bridges, telecom etc. Interestingly, metrological depart-ment gave alerts in advance to state government about heavy rains and possible cloud burst. But as usual, the government o�cials did not give any quick response to these alerts. The govern-ment machinery miserably failed in taking the preventive steps to reduce the impact of the nat-ural calamity. This led to a blame game between government and metrological department for the loss of thousands of lives. At the beginning of rescue operation, government did not have any idea about the number of people stranded there. No database of the residents, tourists and vehicles was available with the authorities.

Coverage by the media helped government to get the understanding of the severity of the catastrophe. Help started pouring in from all over India for rescue and relief work. Our team (from SFID-Society For Inclusive Development) jumped into it by extending help to the agen-cies and groups working in this mission. Inspite of meteorological department warnings of heavy rains in the coming days, we �nally moved to Kedar Valley in the �rst week of July. Loaded with emergency medicines, ration etc. we left for Kedar Valley and reached Guptkashi, pass-ing through broken roads & damaged bridges witnessing landslide on the way. Next day team SFID visited many severely a�ected villages. We kept on changing vehicles due to landslides/road blocks and even trekked down many vil-lages to meet the victims. We realised that this disaster has not hit at one level, but it is a multi level disaster. Of course it is nature’s fury added with ine�ective governance (at preparedness & response level), lack of vision and directions. We cannot escape from our own responsibilities, poor planning, insensitive approach towards mother earth and ever growing greed of human being, to make more & quick money by exploit-ing our own natural resources.

Next day we stopped at one Hydel project site, setup on one of the tributary of Mandakini river. Guards on duty informed us about the damage to the power house. To our surprise, local villag-ers expressed their mixed emotions toward the damage caused to the ongoing hydel projects. Villagers consider them as main culprits for dam-aging the basic attributes of the mountains. It

was interesting to know, how around 70 hydel projects were built in last few years, in which 23 mega projects of 100 MW, 22 Medium Projects of 10-100 MW and 25 small projects of less than 10 MW are coming up. They are damaging lo-cal eco system, cutting down large number of trees, using tonnes of dynamite to shake moun-tains for constructing huge tunnels. We were surprised that, when a layman can explain the logics & probable reasons for this calamity in Ut-tarakhand hills for the sake of so called develop-ment, but probably our decision makers, experts, political leaders are not willing to understand.

While we trekked number of villages, we could not �nd government o�cials, except some local NGOs and CSOs involved in relief work. Not even local MPs/MLAs were present there. Our minis-ters were busy in debating on national television channels, as if it was an opportunity for them to come in limelight at national level forgetting their own people in distress and pain.

Our conclusive observation is that in this fragile eco zone, natural disasters are part and parcel of life. The more we challenge the nature, it will hit back with more force as it is a balancing act of nature. Looking at the whole disastrous event, it reminded me the quote of Paulo Coetho that human beings always say, “Save the Planet” but what Planet must be saying “Save yourself Idiots, I will take care of myself!”. So, with this understanding I can say that leaving behind the concerns of nature, even damaging it, the development will always remain fake! The talk of development in terms of growing concrete buildings, industries, growing GDP etc. is not the actual development.

We need to make green GDP, Sustainable and In-clusive Development as our priority. We need to design our vision documents considering these fragile issues. At the cost of safe and green earth, no development is desirable and justi�ed. We have to �x the responsibility and accountability for death of large number of innocent people and loss of life. The handling of post disaster res-cue operations and the development of amiable future developmental design has to be done in more planned and nature friendly manner. Peo-ple of Uttarakhand, land of Chipko, never want-ed such disastrous development for their state. We do need development, we do need infra-structure and we do need responsible industry/business to create employment with people’s participation, but not at the cost of endangering human life and our eco system.

General questions in the masses today are-

“Was it possible to avert such Catastrophe?” If Yes, then why we didn’t!

“Is the government ready to deal with future calamities?” If Yes, then how?

Anil Jaggi is the Executive Editor, CSR & Com-petitiveness based at Dehradun.

Earthquake, landslides, cloud-burst, �ash-�oods are not new to the people of Uttarakhand, but June16, 2013, came as horror day for them, when thousands of people lost their lives in this calamity. It appeared as if Lord Shiva decided to intervene about the wrong do-ings taking place in his own land. Many families have lost their shel-ters and many villagers have lost the bread earners of their family.

‘‘ ‘‘

We need to make green GDP, Sustainable and Inclusive Development as our priority. We need to design our vision documents considering these fragile issues. At the cost of safe and green earth, no development is desirable and justi�ed.


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Interview Sunfame India’s product portfolio includes range of innovative with lat-est technology solar powered lanterns and power packed home lighting solution system.

23

Our Dream is to Bring Solar Energy to Reach all Strata of SocietyRajat Bothra, Director, Sunfame India

Tell us about Sunfame India and its vi-sion and mission.Sunfame India is a part of East India Group. We are committed in promoting solar energy for empow-erment of communities that are deprived o� grid connectivity or have partial access to electricity that will lead to inclusive growth in Indian econ-omy. Our vision is to innovate and promote solar products that will be towards creating H.O.P.E. for holistic development. Our dream is to bring solar energy within reach of all strata of our society. Further, we work towards removing the depend-ence on Kerosene (instead of giving healthy light, it slowly kills people) and any other conventional

methods (like wood burning) for lighting.

How is H.O.P.E di�erent from HOPE?Our H.O.P.E is very di�erent from HOPE. Through all our solar energy products we will be striving towards creating H (Improving Health – eliminat-ing dependence on Kerosene), O (Creating Social and Economic Opportunities), P (enhancing Pros-perity – eliminating dependence on non-renewa-ble energy to unlimited source of clean n healthy energy), E (promoting Education).

What makes you passionate about So-lar Products?In our country, there are more than 30,000 non electri�ed villages and electri�ed villages face problem of poor or intermittent power supply, power cuts, high �uctuation etc. This leads to-wards poor quality of life of rural as well as urban population.

Solar energy is one of the easily available resource which can help in solving the problem of power scarcity. Solar powered products promote clean and healthy environment (Zero pollution and un-limited source of energy).

Please brief us about your Product Portfolio?Sunfame India’s product portfolio includes range of innovative with latest technology solar pow-ered lanterns and power packed home lighting solution system.

Does Sunfame India have manufactur-ing process for solar products in India? Yes, presently we have set up a testing lab for solar products at our existing venture East India

Technology Company. We have capabilities to manufacture innovative and multiple solar pow-ered products in India through our existing sister concerns’ manufacturing setup in Dehradun and Bangalore.

Does Sunfame India have an in-house research & development team or out-sourcing from other company? We have an in-house strong research & develop-ment team which constantly keeps on working and upgrading our existing product range, devel-oping new technology, and innovating new solar products.

How important has it been for Govern-ment to show such leadership in sup-porting solar power?Today, the biggest challenge we are facing is to educate and generate awareness among the peo-ple on the cost-bene�t analysis of solar products. Through Ministry of New & Renewable Energy (‘MNRE’) and Indian Renewable Energy Develop-ment Agency Ltd. (IREDA), the Indian Govern-ment is trying to regulate solar industry and pro-moting solar powered products through multiple levels of support activities. Indian Government is playing the utmost responsible role in promoting solar energy in India.

How your products are competitive in terms of prices amongst available op-tions in the market? Our product range o�ers solar powered product (lantern) from Rs. 500-1500 with excellent prod-uct quality, durability, innovative with latest tech-nology and reliable after sales service.

Why people need to have Sunfame So-lar Lamps in their households?Sunfame India’s has unwavering commitment for promoting good quality product with clear polic-es on after sales service at the best price.

Making low cost and easy electric-ity availability in the rural India, par-ticularly in dense forest areas, is still a challenge for the Government. How do you think the government agencies can take advantage from your products?It is a challenge for the government and private players operating in this industry. However, with public private partnership, promoting solar prod-ucts will get huge boost. Further, building net-working with Central, State and local level NGOs or civil society organizations, we can generate awareness and promote the solar products. Sun-fame India is in discussion with private players for developing e�ective distribution network and channel across India.

How corporate India can take advan-tage by promoting “Sunfame Solar

Products” under their Corporate Social Responsibility programmes?First of all, we do not consider our products as only solar powered products. We are promoting green initiatives towards clean and green envi-ronment. We believe that we promoting multi-level integrated solar powered environment. To explain this point through example, one of our products “Shiksha” is targeted towards promoting education. Shiksha works for 5-6 hours (after full charge of 8 hours) and gives appropriate white light which is very good for studying. It helps to increase reading hours for students at evening after getting dark in non electri�ed areas. In ef-fect, we are promoting education and improved health of students through our products. There-fore, Corporate India should look at our solar solu-tions as harbingers for creating H.O.P.E.

The use of solar energy in India could help to change this problem, in provid-ing a clean, cheap source of electricity for many areas /communities.What are your views?As I mentioned earlier, Sunfame India’s mission is to eliminate dependence of the people on “Kero-sene (EVIL)” for lighting purposes.

Have you been seeing increased in-terest in alternative energy in recent years due to high fuel prices?In recent years, we have noticed that with pro-motion of bene�ts of alternative / clean energy through multiple modes of communication platforms, the interest in alternative energy has shown a positive trend.

Sunfame India’s has unwaver-ing commitment for promot-ing good quality products with clear polices on after sales service at the best price.

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East India Technologies Pvt. Ltd The company provides EPS packaging to Philips, Panasonic, Dakin, Samsung Electron-ics and other customers. The company also does PCB assembly for global giants like Sch-neider.

Edurables & EVisionThe �rm is the 2nd largest OEM manufactur-er of air-conditioners and microwave ovens for leading brands like LG Electronics, Voltas, Philips and various other customers.

Sunfame India is a venture of East India group. Sunfame India aspires to be-come one of the leading player in o�-grid solar products. In an interview with CSR & COMPETITIVENESS, Rajat Bothra, Director, Sunfame India, speaks about the Solar Products and and how products are sustainable and creating hope for India.

visit - www.sunfameglobal.com

Empowering Rural Youth Vedanta IL & FL Skill School, Korba

Bharat Aluminium Company Ltd. (BALCO), through this premier project, has produced nearly 2200 young men and women who are providing their services to various reputed

companies and are happy to have become ‘self reliant’.

The greatest achievement for anybody is ‘self reliance’. Robert D. Hales, rightly says “As we be-come self-reliant, we will be prepared to face challenges with con�dence and peace of

mind.”

• TheVedantaIL&FLSkillSchoolwasputupinBalcoNagar,inKorbaintheStateofChhattisgarh,tomakepeopleselfreliantandtoinstilconfidenceinpeoplebymakingthemskilledinvariousfields.

• After learning about the requirements of various industries, the youth are trained in skilledworkslikesewing,weldingandinmasteringhospitality.AnationallevelagencyIL&FSassistsBalco in the project.

• Unemployedyoutharescreenedandthenprovidedamonth’sfreetrainingattheSchool.Dur-ing their stay, accommodation, conveyance and meals are provided for by Balco.

• Though,theprojectwasstartedtotargettheyouthlivingbelowthepovertyline,thetrainingopportunitiesattheSchoolarealsoavailabletopromisingyoungpersonswhohaveazealforlearning and in becoming self reliant.

‘AthithiDevoBhava’-meansourGuestisGodanditmeansmuchmoretoDeepikaMahantas the feeling unfolds itself in a beautiful smile while she welcomes guests at Hotel Baby-lon,Raipur,Chattisgarh.Thetwinkleinhereyeandherconfidencespeakvolumesofherhospitalityskills.

Daughterof,BudhwaMahantandAktiMahant,shelearnedtherudimentsofhospitalityataspecialcourse–‘AthithiSatkar’runbyVedantaIL&FSSchoolatBalconagar,Korba,Chhat-tisgarh.AresidentofNehruNagarinBalconagar,thisClass12Commercestudentdidnothavethefaintestideawhatlifehadinstoreforher.ShehadcometotheSkillSchooltolearnindustrialsewing,butaftercounsellingsheconvincedherselfthatsheshouldtakeuptrainingforthehospitalitysector.Thenewcourseonhospitality-‘AthithiSatkar’kin-

dledherpassionforhospitality.ShepassionatelyfinishedthecourseandisgracingthefrontreceptionofHotelBabylon,Raipurtoday.

Lifehasitsupsanddowns.Growingup,Deepikarealisedthatherfather’searningsasalabourerwerenotenoughtobeartheexpensesofthefamily.Beingtheeldestofthetwosiblings,shelearntitearlythatshehadtosupplementherfather’searnings.Itwasherfather’svisiontoletDeepikajointhenewlyintroducedhospitalitycourseattheBalcoSkillSchool.

Eversince,theJune28,2012,thefirstdayofherplacementinHotelBabylonatRaipur,Deepikaisbrimmingwithselfrelianceandcon-fidence.Alongwithherjob,sheisalsopursuingabachelor’sdegreeinCommerce.Herfacelightsupasyouaskheraboutherambition–‘Togethigherandhigherinthehospitalityindustry’shesayswithconfidence.Hatsofftoherdiligenceandpassion!

Herfather,AktiMahant,couldn’tholdhistearsasDeepika’sfirstsalarygracedhispalm.“Iamproudofmydaughter”hesaidasjoyfloodedhisface.MahantnevermissesachancetopraiseVedanta’svisionandsupporttohelpunemployedyouthbeabletostandontheirownfeet,justlikeDeepika.BalcoSkillSchoolisproudofDeepika!

VedantaIL&FLSkillSchoolBharat Aluminium Company Limited

P.O.:BalcoNagar,Korba-495684

Iamproud thatIstand

on my feet

csr & competitiveness august 2013

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