Impact of CSR in Management Education

1. IMPACT OF BLURRING OF DEMARCATION
OF PROFIT/NOT-FOR-PROFIT IDEOLOGY
DUE TO CORPORATE SOCIAL
RESPONSIBILITY (CSR) ON MANAGEMENT
EDUCATION IN INDIA
Loyola College,Loyola College, - Sundar A. Rodriguez- Sundar A. Rodriguez M.Com.,FCA.,DISA.,CFSA(USA).,M.Com.,FCA.,DISA.,CFSA(USA).,
ChennaiChennai Research Scholar, Commerce DepartmentResearch Scholar, Commerce Department

2. AUTHORS PROFILEAUTHORS PROFILE
SUNDAR A. RODRIGUEZSUNDAR A. RODRIGUEZ
M.COM.,FCA.,DISA.,CFSA(USA).,FAIA(UK).,CFA(CANADA).,CICA(USA)M.COM.,FCA.,DISA.,CFSA(USA).,FAIA(UK).,CFA(CANADA).,CICA(USA)
With about 32 years of practical experience in developmental sector, in various capacities including, but not limited toWith about 32 years of practical experience in developmental sector, in various capacities including, but not limited to
auditing, consulting, program planning, implementation etc., I am a “people’s auditor” with experience includingauditing, consulting, program planning, implementation etc., I am a “people’s auditor” with experience including
working at United Nations as Auditor. My qualification includes:working at United Nations as Auditor. My qualification includes:
 Fellow Member of the Institute of Chartered Accountants of India.Fellow Member of the Institute of Chartered Accountants of India.
 Post Qualification Diploma in Information Systems Audit, ICAI, IndiaPost Qualification Diploma in Information Systems Audit, ICAI, India
 Certified Financial Services Auditor, The Institute of Internal Auditors, USACertified Financial Services Auditor, The Institute of Internal Auditors, USA
 Fellow of the Association of International Accountants, UKFellow of the Association of International Accountants, UK
 Certified Financial Accountant, CanadaCertified Financial Accountant, Canada
 Certified Internal Controls Auditor, USACertified Internal Controls Auditor, USA
 Master in CommerceMaster in Commerce
 Presently – Research Scholar, Commerce Department, Loyola College, ChennaiPresently – Research Scholar, Commerce Department, Loyola College, Chennai

3. DOES THIS MAKES SENSE ?!DOES THIS MAKES SENSE ?!

4. CSR – DEFINITION IN COMPANIES ACT 2013CSR – DEFINITION IN COMPANIES ACT 2013
SECTION 135SECTION 135
1)1)Every company having aEvery company having a net worthnet worth of rupees five hundred crore or moreof rupees five hundred crore or more (100 million $(100 million $
or more),or more), or aor a turnoverturnover of rupees one thousand crore or moreof rupees one thousand crore or more (200 million $ or more)(200 million $ or more) ,,
oror a net profita net profit of rupees five crore or moreof rupees five crore or more (1 million $ or more)(1 million $ or more) during any financialduring any financial
year shall constitute a Corporate Social Responsibility Committee of the Board consisting ofyear shall constitute a Corporate Social Responsibility Committee of the Board consisting of
three or more directors, out of which at least one director shall be an independentthree or more directors, out of which at least one director shall be an independent
director;director;

5. AMOUNT TO BE SPENT FOR CSRAMOUNT TO BE SPENT FOR CSR
Section 135 (5)Section 135 (5)
The Board of every company covered under CSR shall ensure for every financialThe Board of every company covered under CSR shall ensure for every financial
year that:year that:
At least 2% of averageAt least 2% of average net profitsnet profits of the company made during 3 immediatelyof the company made during 3 immediately
preceding financial yearspreceding financial years is spent on CSR.is spent on CSR.
This spending to be made in pursuance of its laid CSR Policy.This spending to be made in pursuance of its laid CSR Policy.

6. MIND BOGGLING FIGURESMIND BOGGLING FIGURES

7. PRESENT SCENARIOPRESENT SCENARIO
For Profit organization For Not-For-Profit Organization
Management education –
Different specialization offered.
Tailor made for industry needed
Industry has a specific framework, with
clearly drawn hierarchy, with specific goals.
Management school of thought is live and
kicking.
Management thought policies are properly
documented
Quantifiable expectations
Outputs
Education:
Master of Social Work/M.A (Social Work)
with different specialization.
Specialization is more program focussed and
not management focussed
Lack of clearly articulated management
concepts
Too many stakeholders
Expectation of the different stakeholders are
different.
Non quantitative expectations
Outcomes than output

8. OBJECTIVESOBJECTIVES
• To ascertain the gap between the need for the management skill set for the future
managers of both for the for-profit and for not-for-profit organizations.
• To ascertain the methodology to integrate the requirements expected of from the
management education by both the sectors – profit and not-for-profit organizations, due
to the emerging conceptual amalgamations.
• To ascertain the ways and means to imbibe the ability to the management students to
seamlessly transient from profit to not-profit organizations in their career whether in the
same organization or due to switching to another organization.

9. METHODOLOGYMETHODOLOGY
This is based on the Conceptual Research concept, mainly
because the impact of the CSR on realignment of management
education to its requirement has not begun; and hence, this is
done relying on the review of the literature including the
appropriate statues and the theoretical framework for the
management education.

10. KEY ISSUESKEY ISSUES
• Educational issuesEducational issues
• Psychological IssuesPsychological Issues
• Global Managers with “People’s Perspective”Global Managers with “People’s Perspective”

11. EDUCATIONAL ISSUESEDUCATIONAL ISSUES
 To start with how are we going to call the certificate, as the present Masters in Business
Management would be a misnomer, hence a suitable name imbibing both the concepts is to be
derived.
 It calls of unification of thought process in the academician belonging to the two school of thought,
namely, for-profit and not-for-profit have to come together and figure out “Common Minimum
Ground” in which their thought process and ideas can be better articulated to arrive at a consensus.
 Imbibing in the syllabus to tackle the “Cognitive Dissonance” and “Stockholm Syndrome” to make
the seamless transition on a continuous basis easier.
 Enlarging the understanding of toolsets like United Nations (UN) Global Compact, the UN Guiding
Principles on Business and Human Rights, ILO’s tripartite declaration of principles on multinational
enterprises and social policy, OECD guidelines on Multinational enterprises, Institute of Social and
Ethical Accountability – Accountability’s AA100 series of standards, Social Accountability
International SA 8000 standards, ISO 26000 Social Responsibility, OECD CSR Policy Tool, Global
Compact Self-Assessment Tool, SROI Network (Framework), LBG Model, National Voluntary
Guidelines on Social Environmental and Economic Responsibilities of Business, to name a few.
 Bringing out the management concepts of two different ideologies on the common platform.

12. PSYCHOLOGICAL ISSUESPSYCHOLOGICAL ISSUES
• Cognitive dissonance is a psychological phenomenon which refers to the discomfort felt at a discrepancy
between what you already know or believe, and new information or interpretation. It therefore occurs
when there is a need to accommodate new ideas, and it may be necessary for it to develop so that we
become open to them.
• This would arise amongst the managers from corporates who are ingrained with strong “for profit”
orientation, to understand the nuances of not-for-profit philosophy and practice. The frequent switching
over between these two types of organizations may lead to cognitive dissonance to them. This would be
alleviated in the formative years, if the education that prepares such managers takes note of it and make
such use of learning methodologies that would help them to combat in real life scenario.
• The other psychological issue that has to be addressed during the training of the managers is that of
hangover of “Stockholm Syndrome”. In this case when a CSR manager, works very closely for a longer
period of time with socially relevant projects through active interaction with peoples groups, community
based organizations, activists, non-governmental organizations etc., the influence of their ideology would
linger and would have an impact similar to “Stockholm Syndrome” and that would hamper his perception
that is expected of him by the corporate sector, leading to discord.
• This could also happen in other way round, for example, if the manager is strongly grounded in the profit
paradigm for long, his ability to adjust with the socially conscious not-for-profit environment would defeat
the very purpose of giving impetus to such activities through active and effective participation by the
corporates.

13. GLOBAL MANAGERS WITH “PEOPLE’SGLOBAL MANAGERS WITH “PEOPLE’S
PERSPECTIVE”PERSPECTIVE”
• The CSR is not only confined to India, due to it becoming mandatory for corporates in accordance
with Companies Act 2013, but it has been used in many other countries. Thus there is a need not
only for CSR experts/managers in India, but also globally. The multinational companies having
presence in India, would not only look for managers to implement CSR programs as required by the
Companies Act, 2013, but also would like to have them involved in their other operations.
• To do this the management education should focus on International best practice and groom them in
it. These toolsets includes, but not limited to; toolsets like United Nations (UN) Global Compact, the
UN Guiding Principles on Business and Human Rights, ILO’s tripartite declaration of principles on
multinational enterprises and social policy, OECD guidelines on Multinational enterprises, Institute
of Social and Ethical Accountability – Accountability’s AA100 series of standards, Social
Accountability International SA 8000 standards, ISO 26000 Social Responsibility, OECD CSR Policy
Tool, Global Compact Self-Assessment Tool, SROI Network (Framework), LBG Model, National
Voluntary Guidelines on Social Environmental and Economic Responsibilities of Business, to name a
few.

14. MAJOR FINDINGSMAJOR FINDINGS
• The need for development of a common platform of the academician dealing the two divergent
studies is to be worked out, together with the “Common Minimum” program arrangement, based
on which the discussion of amalgamation of the two sets of management concepts could be worked
out, with additional inputs from the corporate sector, and also from the diverse group like the
activists, community based organization’s representatives, non-governmental-organizations etc.,
from the not-for profit sector.
• The seamless transition from one sector to another more frequently has to be properly addressed
by training so that the psychological impact on such manoeuvre could be minimized.
• Presently there is no comprehensive “single window” training system for the additional skill set
need for the management professionals who are at the different levels of management hierarchy.
• Need to move forward with the changes that are happening globally, though such changes had not
been made mandatory in India, or there is no such practice in India as of now. This comprehensive
course should have the Indian flavour with Global Outlook and prepare managers not only to carry
out and manage the CSR programs in India, but also prepare them to face such challenges in the
global level.
• This cross-disciplinary study would not only have focus on CSR activities, but also open up avenues
for the students both in the “for-profit” as well as “not-for-profit” sector.

15. RECOMMENDATIONSRECOMMENDATIONS
• There is definitely a need for specialized course which
imbibes both the concepts and practice of both profit and
not-for-profit organizations.
• Due to the complexity arising out of the seamless transition
required by the managers, it would not be advisable to go
for some additional training after identifying the specific
need of the individual, but to go for a comprehensive course
in management.

16. POINT TO PONDERPOINT TO PONDER
“It is better to be roughly right
than precisely wrong.”
John Maynard Keynes

17. QUESTIONSQUESTIONS

18. THANKSTHANKS

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