Corporate Social Responsibility PRIYANGA .G ALTACIT GLOBAL
“ Corporate Social Responsibility is the continuing commitment by business to behave ethically and contribute to economic development while improving the quality of life of the workforce and their families as well as of the local community and society at large”- Lord Holme and Richard Watts
3P Mantra’s or Triple Bottom Line
Economic - responsibility to earn profit for owners.
Legal - responsibility to comply with the law. (society’s codification of right and wrong)
Ethical - not acting just for profit but doing what is right, just and fair.
Voluntary and philanthropic - promoting human welfare and goodwill.
Four dimensions of CSR
THE EVOLVING BUSINESS PATTERN
Profit was previously the most important issue of being in Business.
Entering the 21 st century the new mantra of Business are: People– Planet and Profit.
People issues ranging from workers health and safety, employees morale / engagement & development
Social issues on community building & education (issues on entrenched poverty)
Environmental issues e.g. global warming, disturbance of ecosystems etc. are coming to the fore as core business issues.
All these activities are included in the Corporate Social Responsibility of the Company both within and outside the core Business operation.
CSR is the interaction of the Corporation and the external environment outside the core business operation, which involves the interdependent relationship between its core operation, its business partners, the environment and the market including the wider community and the government.
CSR are now becoming an increasingly important part of the business strategy: CSR activities are important tools to support the Company’s Strategy and Image/ Reputation.
Principles of Corporate Social Responsibility
Joint CSR activities could contribute to the micro economic development of a developing country through sustainable benefit to all stakeholders.
At the same time, ensuring optimum national impact, cooperation and communication should be encouraged and socialized.
Corporate Social Responsibility (CSR) Arguments For
CSR helps a corporate to gain better reputation and brand image in the process. This in turn helps in better sales and more investors.
Addresses social issues and allows business to be part of the solution.
Limits future government intervention.
Addresses issues by using business resources and expertise.
Addresses issues by being proactive.
Corporate Social Responsibility (CSR) Arguments Against
The only social responsibility of business is to create shareholder wealth .
The pursuit of social goals dilutes businesses’ primary purpose.
Corporate management cannot decide what is in the social interest .
Costs will be passed on to consumers
It reduces economic efficiency and profit .
CSR behaviour imposes additional costs which reduce competitiveness.
CSR places unwanted responsibilities on businesses rather than on government or individuals.
CSR Initiatives and Green Measures
Reliance Industries and two Tata Group firms—Tata Motors and Tata Steel—are the country's most admired companies for their corporate social responsibility initiatives, according to a Nielsen survey.
As part of its Corporate Service Corps (CSC) programme, IBM has joined hands with the Tribal Development Department of Gujarat for a development project aimed at upliftment of tribal's in the Sasan area of Gir forest.
The Indian paints industry is making its products more environment-friendly by opting for water-based paints and making it carcinogen- free.
The heating, ventilation, air-conditioning and refrigeration (HVAC) industry is working to get rid of its 'global warmer' stigma through greater use of gases with zero ozone depletion potential (zero ODP).
Sustainable Technologies and Environmental Projects Ltd (STEPS) is planning to start a project to change plastic, organic and electronic waste into petroleum without the usual harmful residue.
Characteristics of successful CSR programs
A Company can expect to successfully practice sustainable CSR, only when the Company is able to exert a high degree of control required to ensure GCG within its core business operations.
A business can not do CSR activities without sustainable profit.
The principles of CSR are the same globally, but each location calls for different emphasis in the implementation, depending on the needs of the society in which the business is operating. Involve and empower the local community and form alliances with NGOs, central/regional government, expert/educational institutions and media.
Unlike in developed countries , in which most states assume primary responsibility for social welfare of the community, CSR in developing countries has to focus on the creation of sustainable wealth for the community as well, particularly for the lower income groups.
Characteristics of successful CSR programs
Provide a win-win solution Generates sustainable benefit for all stakeholders
A win-win situation can only be sustainable if continuous community “ capacity development, involvement and empowerment” are being done, supported by the necessary infrastructure.
CSR activities is a necessary part of doing business, especially in developing economies that lack basic infrastructure and the capacity to build social capital.
Ensure continuous monitoring and assessing the CSR implementation and issue sustainable reporting, following the GRI standard.