Corporate philanthropy as a new business

Model –A case study on ITC

From :Sunil Sharma Manali VaishnavShalini Soni

Introduction

• The society through its political organs gave the business the privilege of limited liability and business in turn has to look beyond the interests of the investors to contribute to the society to help sustain it. (Micklethwait and Woolridge in their book, The Company: A Short History of a Revolutionary Idea)

Company Punch LinesITC Citizen First

ABN AMRO We Are a Responsible Institution and Good Corporate Citizen

BOEING Good Corporate Citizenship is a Key Boeing Value

HITACHIThe Hitachi Company Strives to be Responsible Corporate Citizen in Communities’ Worldwide

SHELL To Conduct Business as a Responsible Corporate Member of Society

Case analyses the approaches of ITC’s philanthropy

Broad areas

• Agriculture • Social and farm forestry • Integrated watershed development • Women’s empowerment • environment, health and safety • Art and literature • Music

Emerging trends

• In India , Tatas , birlas , jains and many more their self – enjoined social responsibility /philanthropy in equitable social development . It is reflected in the following developments .

Practices of Indian corporate firms • Hindustan uni-lever ltd (HUL)• Coke India

A survey by SRI/IMRB

• Only old and large companies are practicing social development initiative

16% of the companies were working with NGO

7% of the companies had written policy

Observations on current thinking and practices of CSR

• Carol ,Archie B issue of business horizons under the title “the pyramid of corporate social responsibility ” according to him

• The first dimension • The second dimension • The third dimension

Creating Enduring Value for the Shareholder, as well as to the Nation: The Philanthropic Business Model

of ITC.

Wide range of product mix Enter into new innovative business Market leader

MILESTONES OF THE COMPANY

Key Economic Indicators1995-96 2007-08

Rs. Crores

Gross Turnover 5115 21356

Market Capitalization 5571 70543*

Profit Before Tax 452 4572

Profit After Tax 261 3120

EPS - Basic (Rs.) 0.71 8.29

Net Worth 1121 12058

Book Value per Share (Rs.) 3 32

Capital Employed 1886 12817

Miles stone of ITC in the regards to the rural development

Milestones & Targets Today Next 5 Years

e - Choupal 4 million farmers empowered, 6,500 e - Choupals installed

10 million farmers to be empowered20,000 e - Choupals to be installed

Social & Farm Forestry

88,000 hectares greened,generating 39 million person - days of employment

100,000 hectares to be greened.47 million person - days of employment to be generated

Watershed Development

More than 38,000 hectaresbrought under soil and moisture conservation

56,000 hectaresto be brought under soil and moisture conservation

Women's Empowerment

Over 16,000 women members984 self - help groups

20,000 women members1,500 self - help groups

Livestock Development

103 Cattle Development Centers 2060 villages covered annually

150 Cattle Development Centers3,000 villages to be covered annually

Primary Education

128,000 children coveredthrough 1787 Supplementary Learning Centers

200,000 children to be coveredthrough 2,000 Supplementary Learning Centers

• A digital transformation • Risks through technology • A dependable knowledge partner

ITC’s e-choupal movements :traditions farmers to new age marketers

AWARDS

• Award for business-driven initiatives that make a difference to society at the national level, instituted by the United Nations Development Program (UNDP), the International Leaders Forum and the International Chamber of Commerce. The exhibit-IV provides information on prestige awards won by ITC for its “e Choupal” initiative which was recognized world wide.

AWARDS

• ITC's Agri Business Division has won numerous awards for its “e Choupal”

• United Nations Industrial Development Organization (UNIDO) Award 2008

• Sharing Innovative Agribusiness Solutions

• The Ashoka - Changemakers ‘Health For All’ Award 2006• For the Rural Health Services model for delivery of health services

through the e-Choupals.

 

AND MANY MORE….•

ITC ‘s social and farm forestry –wasteland owners to productive farmers

• ITC’s forestation mission goes beyond regenerating wasteland and forest

• ITC has invested in extensive R&D to develop clonal saplings which are disease resistance

• Collaborate with selected NGO• ITC provides a comprehensive package of

support and extension service

Integrated watershed development – dry despair to green hopes

• The two objectives of ITC’s watershed development are

• Water conservation • Soil enrichment

Women empowerment- homemakers to income builders

• ITC has organized village women into micro-credit groups

• ITC provides training too group members to handle bank accounts

• Venture funds provided by ITC have already spawned hundreds of women entrepreneurs

CONCLUSION

THANK YOU!