Dr.

Suman
Pamecha**
Jasleen Sethi *

Corporate Social Responsibility in India

“Corporate Social Responsibility is defined as operating a business in a manner that meets or

exceeds the ethical, legal, commercial and public expectations that society has of business.
CSR is seen by leadership companies as more than a collection of discrete practices or
occasional gestures, or initiatives motivated by marketing, public relations or other business
benefits. Rather, it is viewed as a comprehensive set of policies, practices and programs that
are integrated throughout business operations, and decision-making processes that are
supported and rewarded by top management.”

As per European Union “CSR is the concept that an enterprise is accountable for its impact
on all relevant stakeholders. It is the continuing commitment by the businesses to behave
fairly and responsibly and contribute to economic development while improving the quality
of life of the work force and their families as well as of the local community and society at
large.”

“CSR is concerned with treating the stakeholders of the firm ethically or in a socially
responsible manner. Stakeholders exist both within and outside. Consequently, behaving
socially responsibly will increase the human development of stakeholders both within and
outside the corporation.”

CSR generally refers to:

 A collection of policies and practices linked to relationship with key stakeholders.

 The commitment of business to contribute to sustainable development. It is the ability
of the current generation to meet its need without compromising the ability of future
generation.

** Associate Professor Economics Department

* Research Scholar
(Janardan Rai Nagar, Rajasthan Vidyapeeth University, Udaipur)

Main Components
Environmental Protection
The focus is to find sustainable solutions for natural resources use to reduce company’s
impact on the environment. It is a approach to a company’s operations, products, and
facilities that includes assessing business products, processes and services eliminating waste
and emissions, maximizing the efficiency and productivity of all assets and resources.

Labour Security
It includes freedom of association and the effective recognition of the right to collective
bargaining, the elimination of all forms of forced and compulsory labour, the abolition of
child labour.

Human Rights
The main focus is on developing workplaces free from discrimination where creativity and
learning can flourish and where a proper balance can be maintained between work and other
aspects of life. This is also related to globalization and increasing international trades and the
challenge of finding ways of doing business world wide that respect human rights and social
justice and facilitate the development of emerging economies.

Community involvement
Corporate community involvement refers to a wide range of actions taken by companies to
maximise the impact of their donated money, time, products, services, influence,
management knowledge and other resources on the communities in which they operate.
These initiatives when properly executed not only bring benefits to the recipients but, also
enhance reputation of companies and their brands, products around the world.

Business standards
Business standards cover a broad area of corporate activities such as ethics, financial returns,
environmental protection, human rights and labour standards. The rise of international trade,
globalisation, and instant communication has led to increasing pressure from various groups
for the formation of global business conduct standards.

Enterprise and economic development

Multinational companies with the wealth of their financial, technical and marketing expertise
are being called upon to provide support for local businesses. At the same time, mnc’s can
help the governments to understand the ways in which an enabling business framework can
be developed to fuel domestic entrepreneurial efforts.
Health Promotion
Today the business can play an important role as a partner in health development. Private
sector business plays a dominant role as the driver of current global economic development.

Education and Leadership Development:

As education is one of the key elements of sustainable development, businesses working
together with public sector and civil society, can make an important contribution to providing
an access to quality education for all.

Benefits of CSR
Corporate social responsibility offers manifold benefits both internally and externally to the
companies involved in various projects. Externally, it creates a positive image amongst the
people for its company and earns a special respect amongst its peers. It creates short term
employment opportunities by taking various projects like construction of parks, schools, etc.
Working with keeping in view the interests of local community bring a wide range of
business benefits. For example, for many businesses, local customers are an important source
of sales. By improving the reputation, one may find it easier to recruit employees and retain
them. Businesses have a wider impact on the environment also. Plantation and cultivation
activities taken up by Intel India are a step towards the same. Recycling used products also
acts as a step towards minimizing wastes.

Internally, it cultivates a sense of loyalty and trust amongst the employees in the
organizational ethics. It improves operational efficiency of the company and is often
accompanied by increases in quality and productivity. More importantly, it serves as a
soothing diversion from the routine workplace practices and gives a feeling of satisfaction
and a meaning to their lives. Employees feel more motivated and thus, are more productive.
Apart from this, CSR helps ensure that the organization comply with regulatory requirements.
Thus it concludes

 Enhancing reputation and brands

 More efficient operations
 Improved financial performance
 Increased sales and consumer loyalty
 Increased ability to attract and retain quality employees
 Government Support

CSR in India
The meaning of CSR is two fold. On one hand, it exhibits the ethical behavior that an
organization exhibits towards its internal and external stakeholders (customers as well as
employees). On the other hand, it denotes the responsibility of an organization towards the
environment and society in which it operates.
In India, CSR has evolved to encompass employees, customers, stakeholders and sustainable
development or corporate citizenship. The spectrum of CSR includes a number of areas as
human rights, safety at work, consumer protection, climate protection and caring for the
environment, and sustainable management of natural resources. From the perspective of
employees, CSR activities include providing health and safety measures, preserving
employee rights and discouraging discrimination at workplace. This helps in fostering a
healthy environment within the company. For example, after 1945, TATA implemented
social welfare provisions for its employees that have since become the legislative norm. From
the perspectives of customers, CRS activities may include commitment to product quality,
fair pricing policies.

CSR has become increasingly prominent in the Indian corporate scenario because
organizations have realized that besides growing their businesses it is also vital to build
trustworthy and sustainable relationships with the community at large. This is one of the key
drivers of CSR programs.

Another reason fuelling this rapid adoption of CSR is the state of the Indian society. Though
India is one of the fastest growing economies, socio-economic problems like poverty,
illiteracy, lack of healthcare etc. are still ubiquitous and the government has limited resources
to tackle these challenges. This scenario has opened up several areas for businesses to
contribute towards social development.

CSR is not a new concept in India. Corporates like the Tata Group, the Aditya Birla Group,
and Indian Oil Corporation, to name a few, have been involved in serving the community
ever since their inception. Many other organizations have been doing their part for the society
through donations and charity events.

Today, CSR in India has gone beyond merely charity and donations, and is approached in a
more organized fashion. It has become an integral part of the corporate strategy. Companies
have CSR teams that devise specific policies, strategies and goals for their CSR programs and
set aside budgets to support them.

These programs, in many cases, are based on a clearly defined social philosophy or are
closely aligned with the companies’ business expertise. Employees become the backbone of
these initiatives and volunteer their time and contribute their skills, to implement them. CSR
Programs range from overall development of a community to supporting specific causes like
education, environment, healthcare etc.

For example, organizations like Bharat Petroleum Corporation Limited, Maruti Suzuki India
Limited, and Hindustan Unilever Limited, adopt villages where they focus on holistic
development. They provide better medical and sanitation facilities, build schools and houses,
and help the villagers become self-reliant by teaching them vocational and business skills.

On the other hand GlaxoSmithKline Pharmaceuticals’ CSR programs primarily focus on

health and healthy living. They work in tribal villages where they provide medical check-up
and treatment, health camps and health awareness programs. They also provide money,
medicines and equipment to non-profit organizations that work towards improving health and
education in under-served communities.
Many CSR initiatives are executed by corporates in partnership with Non-governmental
organizations (NGOs) who are well versed in working with the local communities and are
experts in tackling specific social problems.

For example, SAP India in partnership with Hope Foundation, an NGO that works for the
betterment of the poor and the needy throughout India, has been working on short and long-
term rebuilding initiatives for the tsunami victims. Together, they also started The SAP Labs
Center of HOPE in Bangalore, a home for street children, where they provide food, clothing,
shelter, medical care and education.

CSR has come a long way in India. From responsive activities to sustainable initiatives,
corporates have clearly exhibited their ability to make a significant difference in the society
and improve the overall quality of life. In the current social situation in India, it is difficult for
one single entity to bring about change, as the scale is enormous. Corporates have the
expertise, strategic thinking, manpower and money to facilitate extensive social change.
Effective partnerships between corporate, NGOs and the government will place India’s social
development on a faster track.

Recommendations
 There is a need for creation of awareness about CSR amongst the general public to
make CSR initiatives more effective. This awareness generation can be taken up by
various stakeholders including the media to highlight the good work done by
corporate houses in this area. This will bring about effective changes in the approach
and attitude of the public towards CSR initiatives undertaken by corporate houses.
This effort will also motivate other corporate houses to join the league and play an
effective role in addressing issues such as access to education, health care and
livelihood opportunities for a large number of people in India through their innovative
CSR practices.

 It is recommended that appropriate steps be undertaken to address the issue of

building effective bridges amongst all important stakeholders including the private
sector, employees, local communities, the government and society in general for the
successful implementation of CSR initiatives. As a result, a long term and sustainable
perspective on CSR activities should be built into the existing and future strategies of
all stakeholders involved in CSR initiatives.

 It is noted that only medium and large corporate houses are involved in CSR
activities, that too in selected geographical areas. This issue builds a case for more
companies to be brought under the CSR domain. To address the issue of reaching out
to wider geographical areas, the involvement of small and medium enterprises
(SMEs) in the CSR domain will be essential. It is recommended that a campaign
should be launched to both spread awareness on CSR issues amongst the general
public as well as to involve SMEs to participate more actively in CSR initiatives. This
will help CSR reach out to other locations and cover a large number of communities
and help companies play a valuable role in addressing various social and development
issues. This approach will help CSR get embedded into the DNA of core business
activities of companies.
  It is found that many CSR initiatives and programmes are taken up in urban areas and
localities. As a result, the impact of such projects does not reach the needy and the
poor in the rural areas. While focusing on urban areas; it is recommended that
companies should also actively consider their interventions in rural areas on
education, health, girl child and child labour as this will directly benefit rural people.

 It is noted that the Government should consider rewarding and recognizing corporate
houses and their partner non-governmental organizations implementing projects that
effectively cover the poor and the underprivileged. Motivation always encourages
further development.

 It is noted that CSR as a subject or discipline should be made compulsory at business

schools and in colleges and universities to sensitize students about social and
development issues and the role of CSR in helping corporate houses strike a judicious
balance between their business and societal concerns.

Conclusion

Corporate Social Responsibility consists of a wide-range activities and programs that involve
businesses looking at how to improve their social, environmental and local economic impact,
their influence on society and human rights, and fair trade. Key areas of concern are
environmental protection and the well being of employees, the community and civil society
in general, both now and in the future. It refers to the comprehensive approach that a
corporation takes to meet or exceed stakeholder expectations beyond measures of revenue,
profit and legal obligation.

Even though companies are taking serious efforts for the sustained development, there are
people who claim that Corporate Social Responsibility underlies some hidden motives. In
reality corporates have clearly exhibited their ability to make a significant difference in the
society and improve the overall quality of life. In the current social situation in India, it is
difficult for one single entity to bring about change, as the scale is enormous. Corporates
have the expertise, strategic thinking, manpower and money to facilitate extensive social
change. Effective partnerships between corporate, NGOs and the government will place
India’s social development on a faster track.
References

 Jain Indu, Chairperson: The Times of India Group,

“Corporate social responsibility practices in India”.

 Chakrobarty Bidyut, Corporate Social Responsibilty

 Sekhar R.C. , Ethical Choices in Business

 www.britishcouncil.org

 www.bsr.org