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1. Corporate Social Responsibility (CSR)
Introduction
Business houses, right from the inception of human race, have been regarded
as constructive partners in the communities in which they operate. Though
they have been instrumental in creating employment, wealth, products and
services, yet the pressure on business to play a role in social issues
involving employees, stakeholders, society, environment, government etc. is
continuously increasing. The society is questioning the existence of business
houses, especially in the wake of the scandals and scams conducted by the
business houses like UTI, Enron, and WorldCom. In response to it, the
organizations around the globe are forced to wake up to the need for being
committed towards Corporate Social Responsibility.
Over the years this concept of Corporate Social Responsibility (CSR) has
gained unprecedent momentum in business and public debate and has become a
strategic issue crossing the departmental boundaries, and affecting the way
in which a company does business. It has become so important that many
organizations have rebranded their core values to include social
responsibility. Almost all corporate websites/ policies/reports talk about
their endeavors for CSR which has become a way of ensuring that the
organization is fulfilling all the obligations towards society and thus is
eligible for the license to operate. It assures that the organization can
grow on sustainable basis.
These activities of CSR ranging from small donations to bigger projects for
social welfare sustainable practices differ from organization to organization
depending on the resources available to an organization for undertaking
sustainable practices. Business practices of big and successful companies,
with plenty of resources at their end, have set the trend for being committed
to sustainable practices. Such business houses around the globe show their
commitment to social responsibility. In India, the initiatives of Dabur India
Limited, for example, which commenced 'Sundesh' in 1993, a non-profit
organization, with an aim to promote research and welfare activities in rural
areas are appreciable. On the same track to fulfill its urge to do something
for community, Bharat Petroleum Corporation Limited has adopted 37 villages
as their responsibility to develop in all walks of life. It has made efforts
to make them self-reliant, provided them fresh drinking water, sanitation
facilities, medical facilities, vocational training and literacy camps.
Around its industrial facilities, Tata Group has created towns and cities
like Jamshedpur, Mithapur, Babrala for the benefit of its employees. Cadbury
India, Glaxo and Richardson Hindustan are some of the companies which are
helping farmers to grow crops which in turn shall serve as raw materials for
them (Tripathi & Reddy, 2006).
Although the implementation of such activities involves time, effort and
resources yet the business houses have realized that it (CSR) is one of the
important ways in which an organization can distinguish itself from its
competitors. The tangible and intangible benefits associated with for
organization are immense. A powerful tool like CSR not only enhances the
brand image and reputation of the business but also leads to improvement in
sales and customer loyalty, and increased ability to attract and retain

2. employees. By capitalizing on it, the organizations can improve their
financial performance and attract more investment with immense economic
value. The word CSR has, as a result, occupied very important place in the
plans and strategies of the organizations in the present era.(1)
Definition of Corporate Social Responsibility
Corporate social responsibility (CSR), also known as corporate
responsibility, corporate citizenship, responsible business, sustainable
responsible business (SRB), or corporate social performance- is a form of
corporate
self-regulation integrated into a business model. Ideally, CSR policy would
function as a built-in, self-regulating mechanism whereby business would
monitor and ensure its adherence to law, ethical standards, and international
norms. Business would embrace responsibility for the impact of their
activities on the environment, consumers, employees, communities,
stakeholders and all other members of the public sphere. Furthermore,
business would proactively promote the public interest by encouraging
community growth and development, and voluntarily eliminating practices that
harm the public sphere, regardless of legality. Essentially, CSR is the
deliberate inclusion of public interest into corporate decision-making, and
the honoring of a triple bottom line: People, Planet, Profits. The practice
of CSR is subject to much debate and criticism. Proponents argue that there
is a strong business case for CSR, in that corporations benefit in multiple
ways by operating with a perspective broader and longer than their own
immediate, short-term profits. Critics argue that CSR distracts from the
fundamental economic role of businesses; others argue that it is nothing more
than superficial window-dressing; others yet argue that it is an attempt to
preempt the role of governments as a watchdog over powerful multinational
corporations. Corporate Social Responsibility has been redefined throughout
the years. However, it essentially is titled to aid to an organization's
mission as well as a guide to what the company stands for and will uphold to
its consumers.(2)
Other definitions of CSR:
The notion of companies looking beyond profits to their role in society is
generally termed corporate social responsibility (CSR)….It refers to a
company linking itself with ethical values, transparency, employee relations,
compliance with legal requirements and overall respect for the communities in
which they operate. It goes beyond the occasional community service action,
however, as CSR is a corporate philosophy that drives strategic decision-
making, partner selection, hiring practices and, ultimately, brand
development.(3)
South China Morning Post, 2002)
The social responsibility of business encompasses the economic, legal,
ethical, and discretionary expectations that society has of organizations at
a given point in time.(4)

3. Archie B. Carroll, 1979
CSR is about businesses and other organizations going beyond the legal
obligations to manage the impact they have on the environment and society. In
particular, this could include how organizations interact with their
employees, suppliers, customers and the communities in which they operate, as
well as the extent they attempt to protect the environment.(5)
The Institute of Directors, UK, 2002
CSR is a means of analyzing the inter-dependent relationships that exist
between businesses and economic systems, and the communities within which
they are based. CSR is a means of discussing the extent of any obligations a
business has to its immediate society; a way of proposing policy ideas on how
those obligations can be met; as well as a tool by which the benefits to a
business for meeting those obligations can be identified.
Corporate Social Responsibility: Unlocking the value
According to the results of a global survey in 2002 by Ernst & Young, 94 per
cent of companies believe the development of a Corporate Social
Responsibility (CSR) strategy can deliver real business benefits, however
only 11 per cent have made significant progress in implementing the strategy
in their organization. Senior executives from 147 companies in a range of
industry sectors across Europe, North America and Australasia were
interviewed for the survey. The survey concluded that CEOs are failing to
recognize the benefits of implementing Corporate Social Responsibility
strategies, despite increased pressure to include ethical, social and
environmental issues into their decision-making processes. Research found
that company CSR programs influence 70 per cent of all consumer purchasing
decisions, with many investors and employees also being swayed in their
choice of companies. "While companies recognize the value of an integrated
CSR strategy, the majority are failing to maximize the associated business
opportunities," said Andrew Grant, Ernst & Young Environment and
Sustainability Services Principal. "Corporate Social Responsibility is now a
determining factor in consumer and client choice which companies cannot
afford to ignore. Companies who fail to maximize their adoption of a CSR
strategy will be left behind."(6)
Arguments Against Business Performing Social Responsibility
Activities
The best-known argument against business performing social responsibility
activities has been advanced Milton Friedman, one of America's most
distinguished economists. Friedman argues that making business managers
simultaneously responsible to business owners for reaching profit objectives
and to society for enhancing social welfare sets up a conflict of interest
that could potentially cause the demise of business as it is known today.
According to Friedman, this demise will almost certainly occur if business is
continually forced to perform socially responsible actions that directly

4. conflict with private organizational objectives."
Friedman also argues that to require business managers to pursue socially
responsible objectives may, in fact, be unethical, because it compels
managers to spend money on some individuals that rightfully belongs to other
individuals.
In a free enterprise, private property system, a corporate executive is an
employee of the owners of the business. He has direct responsibility to his
employers. That responsibility is to conduct the business in accordance with
their desires, which generally will be to make as much money as possible
while conforming to the basic rules of society, both those embodied in law
and those embodied in ethical custom. Insofar as his actions reduce returns
to stockholder, he is spending their money. Insofar as his actions raise the
price to customers, he is spending the customer's money.
An example that Friedman could use to illustrate his argument is the Con trol
Data Corporation. Former chairman William Norris involved Control Data in
many Social responsible programs that cost the company millions of dollars -
from building plants in the inner city and employing a minority workforce to
researching farming on the Alaskan tundra. When Control Data began to incur
net losses of millions of dollars in the mid-1980s, critics blamed Norris's
"do-gooder" mentality. Eventually, a new chairman was installed to
restructure the company and return it to profitability.(7)
Corporate Social Responsibility in Bangladesh
CSR concepts and practices in Bangladesh have a long history of philanthropic
activities from time immemorial. These philanthropic activities included
donations to different charitable organizations, poor people and religious
institutions. Till now, most of the businesses in Bangladesh are family owned
and first generation businesses. They are involved in community development
work in the form of charity without having any definite policy regarding the
expenses or any concrete motive regarding financial gains in many instances.
Moreover, most of the SMEs fall under the informal sector having low
management structure and resources to address the social and environmental
issues. These limitations drive the top management of local companies to
think only about the profit maximization rather than doing business
considering the triple bottom line: profit, planet and people (CSR definition
of Lotus Holdings).
The discussions on CSR practices in Bangladesh in its modern global terms,
are relatively new, but not so for the concept itself. Because, being a part
of the global market, it is difficult to ignore CSR standard specifically in
the export sector. In general, it is true that in Bangladesh, the status of
labor rights practices, environmental management and transparency in
corporate governance are not satisfactory, largely due to poor enforcement of
existing laws and inadequate pressure from civil society and interest groups
like Consumer Forums. Globally, as CSR practices are gradually being
integrated into international business practices and hence is becoming one of
the determining factors for market accesses, it is becoming equally
instrumental for local acceptability. A focus on CSR in Bangladesh would be
useful, not only for improving corporate governance, labor rights, work place

5. safety, fair treatment of workers, community development and environment
management, but also for industrialization and ensuring global market access.
Since, CSR entails working with stakeholders it is important to work from
within and diagnose the stakeholders; concerns so that CSR is truly embedded
in the companies. By now, many CSR dimensions are practiced in Bangladesh.
The SMEs largely depend upon export. The US and EU buyers set guidelines to
Readymade Garment (RMG) industry to ensure the standards. The 1992 Harkin's
Bill and subsequent consumer and industry boycott of RMG products by USA and
the consequent remedial moves by local RMG sector is one example. Moreover,
some buyers from EU visited the sites of recently collapsed garments
factories. A temporary ban was also imposed on shrimp export to the EU on
health and hygienic standard and appropriate remedial action followed in that
instance too. But, some of the exporters found difficulty in convincing the
US/EU buyers to have positive attitude towards Bangladesh due to inadequate
CSR practices.
Businessmen need to recognize the implications of CSR for business
activities. Companies are facing the challenges of adapting effectively to
the changing environment in the context of globalization and in particular in
the export sector. Although Consumer Rights Movement, enforcement of
government regulations and a structured view regarding the economic
importance of CRS are not yet so widespread in the corporate world in
Bangladesh, companies have gradually been attaching more importance to CSR in
the local market as well. They are increasingly aware that CSR can be of
direct economic value. Companies can contribute to social and environmental
objectives, through integrating CSR as a strategic investment into their core
business strategy, management instruments and operations. This is an
investment, not a cost, much like quality management. So, business
organizations can thereby have an inclusive financial, commercial and social
approach, leading to a long term strategy minimizing risks linked to
uncertainty.
CSR in Bangladesh can also contribute a lot to community development. The
corporate house can develop the community by creating employment, providing
primary education, contribution to infrastructure development like road and
high-ways and addressing environmental concerns. This is more relevant for a
country like Bangladesh where the government interventions in these fields
augmented by corporate alliance can go a long way in developing the economy,
society and environment.
Lack of enforcement of Industrial Laws and Regulations, weak unions, absence
of consumer rights groups and high level of corruption within the regulatory
bodies make CSR violation rampant in Bangladesh. Two most significant foreign
exchange sources is the RMG sector and the overseas manpower export.
Unbelievably low compensation, working hours, health/hygiene/sanitation
conditions, fire safety and various types of abuse are so common and to the
extent of inhumanity that will shock any conscientious individual to the
core. Recently, the RMG sector employees have embarked on a industry wide
movement to establish their rights.
Overseas workers are mostly exploited by recruiting agencies whereas these
rural and mostly illiterate people have to sell all their belongings becoming
paupers and borrow money at very high interest. Owing to cheating by the
recruiters and unlawful behavior by the overseas employers, many of them are
compelled to come back as beggars, some after long confinement in overseas

6. jails. Hardly any remedy is available from the law enforcing agencies. Many
industrial units run with half-century old machinery producing fatal air,
soil and water pollutions. More modern factories also don't care to install
Effluent Treatment Plants. Starting from FMCGs, vegetables, fruits and all
other consumable goods, adulteration, abnormal ripening at times with
poisonous elements, keeping fish fresh with applying deadly formalin and all
other malpractice is rampant and carefree. Good governance and efficient law
enforcing agencies can only solve these plights.
Although a developing country, because of global competitiveness and demand,
the CSR practices and standards are being gradually implemented in
Bangladesh. But there is a long way to go. There are challenges to implement
CSR properly in Bangladesh. Ultimately CSR practices should be better
practiced in Bangladesh for better and enhanced performance. In the
publication "Good Governance and Market-Based Reforms: A Study of Bangladesh,
Fara Azmat and Ken Coghill relates Good Governance with CSR by discussing the
good governance indicators of regulatory quality, rule of law and control of
corruption in the context of Bangladesh and analyses how lack of good
governance indicators affects the success and sustainability of reforms and
contributes to the lack of business ethics and CSR in Bangladesh.(8)
Some Example of Performing Corporate Social Responsibility
Activities
Corporate Social Responsibility of IBM:
# Education- IBM realizes the worldwide power and importance of education.
Through major initiatives such as Reinvestment Education, KidSmart, and
project FIRST, the company hopes to promote knowledge and skills that will
ensure that communities thrive around the globe.
# Adult training and workforce development- IBM invests in helping others to
use technology as a powerful tool in education and job training programs for
adults. There is a special focus on using technology to broaden opportunities
and strengthen programs available to adults in need of new skills and
employment.
# Arts and Culture- IBM's support of the arts steam from its strong
commitment to bettering its communities. By joining with libraries, museums,
and other cultural institutions in exciting partnerships that leverage IBM
expertise, the company demonstrates the critical role of technology plays in
enhancing the arts.(9)
Corporate Social Responsibility of GRAMMENPHONE:
# Safe Motherhood and Infant Care Project-
Grameenphone Safe Motherhood & Infant Care Project is thus designed to ensure

7. free, yet quality, safe motherhood and infant care services to poor mothers
and their infants throughout the country. It also aims to assist in necessary
infrastructure development and extension of basic healthcare services,
especially in the hard-to-reach and remote areas.
# Education- In collaboration with Grameen Shikkha, an organization of the
Grameen Bank family, Grameenphone provides scholarship to some 100 bright but
underprivileged students at different academic levels through a scholarship
fund annually. It also provides educational support to a number of special
schools - Tauri Foundation, HANS, CDC, and SEID Trust – with an objective to
aid in the learning process of the gifted children in our society.
Grameenphone is also a proud partner of the Enrichment Program of Bishsho
Shahitto Kendro through which free books are distributed. It recently
initiated a CSR project to publish and distribute illustrated publications on
the Liberation War for school-going children, with the objective to inspire
them with the heroics of our freedom-fighters.
# Fight against HIV/AIDS- One of the eight Millennium Development Goals for
Bangladesh is to halt the spread of HIV and AIDS by 2015. Hence, Grameenphone
is committed to work closely with Bangladesh Government and concerned
development agencies to achieve that target, with the aim to raise awareness
and advocate for necessary policy reforms on HIV/AIDS through different
communication channels.(10)
Corporate Social Responsibility of AKTEL:
# Aktel in Bishwa Estema- Aktel had taken initiative of executing various
activities in Bishwa Estema, the 2nd largest Muslim gathering in the world
after Holy Hajj in which millions of people came from different parts of the
world to participate in this pilgrimage. Among the initiatives, are to
provide instant primary aids to the pilgrims through free medical check-up by
a team of certified doctors' at the Aktel voluntary medical service point
from morning to night. Aktel also served free pure drinking water for the
pilgrims of Bishwa Estema.
# Aktel stands besides cold affected underprivileged people- On a CSR
campaign Aktel has distributed blankets to the underprivileged people of the
country.(11)
Corporate Social Responsibility of Dutch-Bangla Bank:
# Education- Dutch-Bangla Bank provides a lot of scholarship to
underprivileged students for their education. It has given support many
students for higher education. It also arranges Olympiad of Mathematics to
develop students' mathematical knowledge.
# Environmental Development- To develop environment of Bangladesh it has
taken tree plantation programs across the country.
# Social Development- It has taken some necessary steps against dowry and
drugs which are the curse of Bangladesh. (12)

8. Corporate Social Responsibility of UNILEVER BANGLADESH
# Public Health- Unilever Bangladesh (pvt.) limited implements many programs
on public health. They already have taken initiative for free dental check
up. They create consciousness among the rural people about Health by their
many activities.
# Arts and Cultural development- In Bangladesh for cultural development
Unilever Bangladesh (pvt.) limited has done many things giving sponsor to
many cultural organization.(13)
References
1. Business Intelligence Journal - January,2009
2. Wikipedia,
3. Michael McComb, 'Profit to be found in companies that care,' South
China Morning Post, April 14, 2002, p. 5.
4. Archie B. Carroll, 'A Three-Dimensional Conceptual Model of Corporate
Performance,' Academy of Management Review, 1979, Vol. 4, No. 4, p.
500.
5. Ruth Lea, 'Corporate Social Responsibility: IoD Member Opinion Survey,'
The Institute of Directors, UK, November, 2002, p10.
6. Corporate Social Responsibility, ASOCIO Policy Paper June 2004
7. Samuel C. Certo & S. Trevis Certo, Modern Management, 10th edition.
8. www.ammado.com, Website of Ammado Foundation.
9. Report on Corporate Social Responsibility of IBM, 2009
10. Annual CSR publications of Grameenphone, 2009
11. Aktel CSR Campaign, 2009
12. CSR activities of Dutch-Bangla Bank,2009
Report on Corporate Social Responsibility of Unilever Bangladesh, 2009
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