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CSR - shaping force for corporate culture
The first thing that we must ask ourselves is, ‘Does business mean making profit only?’ If only profit is not the sole motive then a responsibility to the society comes in. Every corporate organization has an obligation to give to the society beneficial products, employment and other benefits. An organization at the same time has to decide upon the extent of such a responsibility. Corporate social responsibility is the impact that a manager’s decision has on the societal system that is a manager should consider the organization as a societal system and that every decision taken can have both positive and negative effects. Thus, corporate social responsibility is in public interest.
The concept of CSR has evolved from the fact that an ethical way of doing business should be developed keeping both the legal and environmental aspects in mind. The criticism of unethical business practices lead to a rising concern for a socially contractual business process to be developed. From the 1950’s CSR has been accepted and the additions to CSR in the form of corporate responsiveness and citizenship have broadened the scope of the subject. A completed answer to what CSR is Carroll’s four part definition of the concept, ‘ CSR encompasses the economic (profit and sales maximizing), legal (adherence to regulations), ethical (just and fair) and discretionary (philanthropic) expectations that society has of organizations at a given point of time.’
The continuing commitment by business to behave ethically and contribute to sustainable economic development while improving the quality of life of the workforce and their families as well as of the local community and society. An approach for CSR is becoming more widely accepted that is community-based development projects.
The concept of CSR is interpreted by different companies in a different manner, also the business that an organization does require varied obligations. The Mahindra Group for example defines Corporate Social Responsibility as making socially responsible products, engaging in socially responsible employee relations and making a commitment to the community around it. At the Mahindra Group, Corporate Social Responsibility is not just a duty; it's a way of life. In 2005, the Group celebrated its 60th anniversary by renewing its commitment to CSRl. It pledged to dedicate 1% of its profit (after tax), on a continuous basis towards Corporate Social Responsibility. A unique kind of ESOPs - Employee Social Options was launched to enable Mahindra employees to involve themselves in socially responsible activities of their choice.
Achieving commercial success in such a way that honors ethical values and respect people, communities and the natural environment. A more common approach of CSR is through the giving of aid to local organizations and impoverished communities in developing countries.

Considering that construction industry is the second largest employer in India after agriculture, L&T set out to regulate and promote Construction Vocational Training (CVT) in India by establishing a Construction Skills Training Institute (CSTI). CSTI imparts, totally free of cost, basic training in formwork, carpentry, masonry, bar-bending, plumbing and sanitary, scaffold and electrical wireman trades to a wide spectrum of the rural poor.
The success of this training-initiative demonstrates that adoption of systematic training techniques are bound to yield efficient and skilled personnel in the shortest possible time, and in the power to convert the potential of the Rural Youth in Construction and upgrading Rural Economy in a small way.
Through education and dialogue, the development of community in holding businesses responsible for their actions is growing. Indian corporate house can be portrayed as good Samaritans.Tata Consultancy Services for example define CSR by The Adult Literacy Program (ALP) which was conceived and set up in May 2000 to address the problem of illiteracy. ALP believes illiteracy is a major social concern affecting a third of the Indian population comprising old and young adults.

Building the culture of doing right thing. The concept of CSR is deeply incorporated. Now days, new strategies are adapted. It has progressed significantly in recent years. The ideas include everything from highly localized community based problems to planetary issues. Beyond ethics, it includes responsibility related towards customer, workplace, environment, community & suppliers. CSR drives for innovation through strong leadership & sophisticated people management. Yet, it still has a long way to go.

Criticism: The practice of CSR is subject to much debate and criticism. Critics argue that CSR distracts from the fundamental economic role of businesses; others argue that it is nothing more than superficial showmanship; others yet argue that it acts as a watchdog over powerful multinational corporations. There is no. of concerns related to critics of CSR saying, that CSR programmes are undertaken by the companies in order to improve corporate profitability & to distract the public from ethical questions posed by their core operations. Future of CSR is on the way to ISO (International organization for standardization).

Conclusion: CSR encourages each company to create economic and social value simultaneously by focusing on the social issues that each is uniquely capable of addressing. CSR is basically for protecting the planet by taking care of the environment, the people around not to forget to make profits. So to sum up, CSR is for planet people and profits. The perilous effects of globalization are alarming evident in 21st century as compare to the previous century. As a result CSR as a management practice will have to move from being a management fad or a passing trend to a vital part of a company’s business model to ensure long term profitability & sustainability.


Reet Kamal Chhabra

(INDIRA SCHOOL OF BUSINESS STUDIES)

Corporate Social Responsibility


A shining BMW stops near a street hawker (a 12 year old kid) who is selling cigarettes. A gentleman asks for a cigarette. Coincidently he is the CEO of this company XYZ which manufactures this brand. He lights up to smoke and starts driving along a barren patch of land which belongs to XYZ ltd. These lands used to endow green lush forests some ten years back. He also leaves behind a highly smelling and toxic area which it calls dumping ground where XYZ ltd is licensed to dump its chemical waste. Now he faces a river which has turned black by the discharged chemicals. Finally he arrives at a hospital where one of his factory workers is on his death bed fighting lung cancer. Doctors say that he got the decease because of continuous inhalation of toxic gases.

XYZ pays high dividend to its shareholders, investors are very happy and employees are compensated extremely well. It pays to govt taxes, in the tune of millions of dollars, it is listed high amongst the 500 fortune companies and it has made the country proud by the great business model it portrays.

The other face of coin, one third of the suburban area where XYZ has its plants have become barren, villagers have been displaced to a remote locality in apartments which has got no vegetation, Sun is almost invisible because the air is so polluted. Last year this area faced extreme flood because of soil erosion.

Few questions that need to be answered immediately: How long can XYZ survive and stay profitable? And even it does then at what Cost? How many companies like XYZ really calculate the cost of air pollution, river pollution, diseases and environmental damage they really do? I hope if they include theses costs they will find themselves incurring tremendous loses.

Corporate Social responsibility is defined as “A concept whereby companies integrate social and environmental concerns in their business operations and in their interaction with their stakeholders on a voluntary basis.” It’s encouraging to see that lot of companies like ITC, Mahindra, GE, Shell, EXXON and BP are doing great job in this area. ITC’s e-Choupal is a great initiative to help Indian farmers. The Nobel Prize winner Muhammad Yunus’s Grameen bank has done marvellous job to help marginal farmers and villagers by providing them small credit loans. BP is very famous for its environmental awareness programmes which are called Beyond Petroleum initiatives.


However it is not only the organisations that have a CSR. Lot of governments also take inclusive part to promote this. United states- triple bottom line, United nations-principles of responsible investments and Indian government talking about carbon credits to companies are great initiatives in this sector.

But critics point out that lot of lip service is being done on the name of Corporate social responsibility. GE’s failure to clean Hudson River and Australian govt’s non compliance to Kyoto protocol are few examples.

It’s the need of hour that governments and corporate houses start looking at a sustainable growth and stop chasing their short term profit objectives. Otherwise the cost of environmental damage and social degradation will be so high that even the great organisations and nations would crumble down to devastation.

Neha Sinha

( INDIRA SCHOOL OF BUSINESS STUDIES)

“CORPORATE SOCIAL RESPONSIBILITY”

Corporate Social Responsibility (CSR) is a concept in the business world. In simple words, "CSR is about business giving back to society". CSR is about how companies manage the business processes to produce an overall positive impact on society. “A concept whereby companies decide voluntarily to contribute to a better society and a cleaner environment.”

CSR is a concept whereby companies integrate social & environmental concerns in their business operations & in turn interaction on a voluntary basis. CSR is the continuing commitment by business to behave ethically & contribute to economic development while improving the quality of life of the workforce & their families as well as of local community & society at large.


The business benefits of corporate social responsibility –

Being a good corporate citizen is increasingly crucial for commercial success. It is not good enough any longer just to be a good corporate citizen; you must also be seen to be. Expectations among key opinion formers, customers and public are increasing, some are meeting it; others are failing to do so, and still others are scrambling to catch up with public expectations.

CSR is not an additional extra – it runs to the core of every company’s ethics, and its treatment of employees and customers. The key to success lies in matching public expectations and priorities, and in communicating involvement and achievements widely and effectively.

Traditionally in the United States, CSR has been defined much more in terms of a philanthropic model. Companies make profits, unhindered except by fulfilling their duty to pay taxes. Then they donate a certain share of the profits to charitable causes. It is seen as tainting the act for the company to receive any benefit from the giving.

The European model is much more focused on operating the core business in a socially responsible way, complemented by investment in communities for solid business case reasons.

Personally, I believe this model is more sustainable because: -

• Social responsibility becomes an integral part of the wealth creation process - which if managed properly should enhance the competitiveness of business and maximize the value of wealth creation to society.
• When times get hard, there is the incentive to practice CSR more and better - if it is a philanthropic exercise which is peripheral to the main business, it will always be the first thing to go when push comes to shove.




While even in India many companies have started contributing for the concept of CSR. Technology for the People (TFTP) was founded as a technical support organization to promote developmental issues through appropriate technology and support in expanding the existing activities in ways in which technology can be leveraged to bring about economic empowerment to marginalized communities.

TFTP established resource centers in five locations in parts of the old city of Hyderabad to provide education and livelihood alternatives for adolescent girls who are vulnerable to early marriages and other exploitative forms of labors. Students are prepared to appear for the X Standard exams along with livelihood training in animation.

The course starts with basic drawing skills and progresses to converting the hand movement techniques from mehendi to animation. Inputs on personality development, communication, and spoken English are also incorporated in the curriculum so that the students are empowered for this transition in their lives. Adolescent girls, who dropped out of school and earn a meager income by way of helping their mothers in hand embroidery and mehendi-designing during wedding seasons, are now full time graphic and animation artists for Star Features, an animation studio in the city of Hyderabad.

Similarly every year, Indian Oil sets aside a fixed portion of its profits for spreading smiles in millions of lives across the country through a comprehensive community welfare and development program. About one-fourth of the community development funds are spent on the welfare of Scheduled Caste and Scheduled Tribe beneficiaries.

Indian Oil has a concerted social responsibility program to partner communities in health, family welfare, education, environment protection, providing potable water, sanitation, and empowerment of women and other marginalized groups. Indian Oil has always been in the forefront in times of national emergencies. Indian Oil People have time and again rallied to help victims of natural calamities, maintaining uninterrupted supply of petroleum products and contributing to relief and rehabilitation measures in cash and kind. The Corporation also supports a variety of endeavors in arts, culture, music and dance, apart from organizing programs on its own under the banners of Indian Oil Art Exhibition, Indian Oil Sangeet Sabha and Indian Oil Kavi Sammelan.

CSR plays a very important role as, “CSR is the capacity building for sustainable livelihoods. It respects cultural difference & finds the business opportunities in building the skills of employees, the community and government.”



Bhushan Bokil
INDIRA SCHOOL OF BUSINESS STUDIES