TABLE OF CONTENTS

1. INTRODUCTION
CSR DEFINITION
CSR REPORTING
CSR-INDIAN PERSPECTIVE
CSR-GLOBAL PERSPECTIVE

2. INDUSTRY PROFILE

3.COMPANY PROFILE

4.LITERATURE REVIEW
BAJAJ
BRIEF HISTORY
MISSION/VISION STATEMENT
PRODUCTS
CSR ACTIVITIES

5.METHODOLOGY

6.DATA ANALYSIS

7.RECOMMENDATIONS

8.CONCLUSIONS & IMPLICATIONS

9.BIBLIOGRAPHY
 INTRODUCTION

THE World Business Council for Sustainable Development has defined corporate social
responsibility (CSR) as the "ethical behavior of a company towards society". Corporate Social
Responsibility (CSR) is a concept which defines that organization, especially (but not only)
corporations, have an obligation to consider the interests of, customers employees, communities,
and ecological considerations in all aspects of their operations. This obligation is seen to extend
beyond their statutory obligation to comply with legislation. Corporate social responsibility is
more a business question than a legal question.

The social and environmental problems that our world faces are intractable, complex, and multi-
faceted and there is evidence claiming that business has been a contributor to these problems.
Most of this evidence indicates business is poised to be one of the more powerful and effective
agents in the solutions. A clear 'best practice' for corporations hoping to engage in strategic
corporate responsibility is to engage with multiple stakeholders and to strategically partner
across sectors. It stands to logical reason that one effective partnership to highlight is between
business and academia: a not so typical for-profit and not-for-profit partnership. Little focus and
attention has been given to the opportunity and potential of academic partnerships with business
to advance the Corporate Social Responsibility (CSR) agenda. If we are to truly change the
global management paradigm to one of sustainability and integrated strategic CSR, one critical
and rudimentary step in this process is to build this management mentality into our core
management training: we must educate future management leaders in the critical theory,
frameworks, and practice of integrated strategic CSR, just as we educate them in traditional areas
of finance, marketing, and accounting (Kellie A. McElhaney, Unpublished Thesis). It is
important to distinguish CSR from charitable donations and "good works". CSR goes beyond
charity and requires that a responsible company take into full account its impact on all
stakeholders and on the environment when making decisions. This requires the company to
balance the needs of all stakeholders with its need to make a profit and reward shareholders
adequately. The scale and nature of the benefits of CSR for an organisation can vary depending
on the nature of the enterprise, and are difficult to quantify, though there is a large body of
literature exhorting business to adopt measures beyond financial ones. Corporate social
responsibility (CSR) is an extended model of corporate governance and then accounts for a
voluntary approach to CSR, meant as voluntary compliance with CSR strategic management
standards, in terms of an economic theory of self-regulation based on the concepts of social
contract, reputation and reciprocal conformism.
CSR is closely linked with the principles of sustainable development, which argues that
enterprises should make decisions based not only on financial factors such as profits or
dividends, but also based on the immediate and long-term social and environmental
consequences of their activities. Todays heightened interest in the role of businesses in society
has been promoted by increased sensitivity to and awareness of environmental and ethical issues.
Issues like environmental damage, improper treatment of workers, and faulty production that
inconveniences or endangers customers are highlighted in the media.

In some countries government regulation regarding environmental and social issues has
increased. Critics of CSR attribute other business motives, which the companies more often
dispute. For example, some believe that CSR programmes are often undertaken in an effort to
distract the public from the ethical questions posed by their core operations. It has been
suggested that CSR activity is most effective in achieving social or environmental outcomes
when there is a direct link to profits: hence the CSR slogan "Doing Well by Doing Good". This
requires that the resources applied to CSR activities must have at least as good a return as that
that these resources could generate if applied anywhere else, e.g. capital or productivity
investment, lobbying for tax relief, outsourcing, off shoring, fighting against unionization, taking
regulatory risks, or taking market risksall of which are frequently-pursued strategies. Whatever
altruistic values the company once had becomes socially responsible only to the extent that it
enhances the corporate brand and makes sense for long-term profits. Which is not necessarily
the wrong way to do corporate social responsibility? Profit-seeking corporations, constrained and
buttressed by moderate government regulation and spending, did far more to increase the welfare
of the world than a proliferation of socially responsible governments. Firms may be able to
reduce their cost of capital by appealing to socially responsible investors.

The real threats to profit-maximization dont come from the socially responsible investment
movement rather one of those threats is ineffective governance that does not adequately constrain
managers to act in shareholders long-term interests. These managers might take refuge in
excessive social responsibility, but social responsibility is more a symptom than the problem
itself. Advocates of corporate social responsibility say that firms are too economically powerful
to ignore society. So they should transcend market dictates and do whats right for society.
Corporate managers are trained and focused on making money. So we seem to be stuck with a
conundrum. There is no fundamental dichotomy between long-term profit-maximization and
social responsibility. Social responsibility equates with maximizing long-term shareholder value.
This doesnt mean ignoring customers, workers and others the company relies on to produce that
value. But it also doesn't mean adopting a conscious strategy of helping society, which is
regarded as a prescription for helping no one not society, not shareholders.

The evolution of the relationship between companies and society has been one of slow
transformation from a philanthropic coexistence to one where the mutual interest of all the
stakeholders is gaining paramount importance. Companies are beginning to realize the fact that
in order to gain strategic initiative and to ensure continued existence, business practices may
have to be molded from the normal practice of solely focusing on profits to factor in public
goodwill and responsible business etiquettes. An examination of some of the factors which have
led to the development of the concept of corporate social responsibility (CSR) would be ideal
starting ground for the conceptual development of suitable corporate business practices for
emerging markets.

The business environment has undergone vast changes in the recent years in terms of both the
nature of competition and the wave of globalization that has been sweeping across markets.
Companies are expanding their boundaries from the country of their origin to the evolving
markets in the developing countries which have been sometimes referred to as emerging markets.
The current trend of globalization has brought a realization among the firms that in order to
compete effectively in a competitive environment; they need clearly defined business practices
with a sound focus on the public interest in the mark.

The increase in competition among the multinational companies to gain first mover advantage in
various developing countries by establishing goodwill relationships with both the state and the
civil society is ample testimony to this transformation. Secondly, in most of the emerging
markets, the state still holds the key to business success because of the existence of trade and
business regulations restricting the freedom of multinational companies to incorporate their
previously successful business doctrines which have been tried and tested in the developed
nations.

The state with its duty of protecting the interests of the general public would naturally be
inclined to give preference to companies which take care of the interests of all the stakeholders.
Thirdly, emerging markets have been identified as a source of immense talent with the rising
levels of education. For example, the expertise of India in churning out software professionals
and China in manufacturing has now become internationally renowned.In order to draw from this
vast talent pool coming up in developing countries, companies need to gain a foothold in these
markets by establishing sound business practices addressing social and cultural concerns of the
people.

It has been observed that consumers consider switching to another company's products and
services, speak out against the company to family/friends, refuse to invest in that company's
stock, refuse to work at the company and boycott the company's products and services in case of
negative corporate citizenship behaviors . Last but not the least, firms all over the world is
beginning to grasp the importance of intangible assets, be it brand name or employee morale.
Only firms that have gained the goodwill of the general public and are ideal corporate citizens
will be to develop these intangible assets into strategic advantages. The cumulative contribution
of all the above mentioned factors can be summarized by figure below.
Social responsibility theorists assume that profit-maximization is incompatible with broader
social interests, so that managers should be free to serve society generally rather than exclusively
shareholders. In fact, markets powerfully constrain anti-social corporate conduct. It follows that
managers would serve societys interests best by focusing on long-term profit-maximization.
However, the corporate form inherently gives managers significant slack to diverge from profit-
maximization. The solution is to fundamentally change the governance structure of publicly held
firms toward a partnership-type model that reduces managers control over the firms cash. This
move is facilitated by the shift toward thicker markets, which decreases firms need to lock assets
up in a strong and durable corporate entity. The main impediment to such a change is the
corporate tax, which gives managers incentives to retain earnings.

Methods of CSR reporting

Moon (2002) distinguishes three types of CSR reporting community involvement, socially
responsible production processes and socially responsible employee relations. During the
initial stages of development of CSR in emerging economies, the community involvement is
more along the lines of a philanthropic involvement with company involvement limited to
developing minimal or rather the absolutely necessary amount of communal goodwill necessary
to operate in the business environment. As compared with the developed countries like US, CSR
in developing countries is seen as part of corporate philanthropy where corporations augment the
social development to support the initiatives of the government. However in the US it is seen as a
strategic tool which helps the organizations to have a legitimate existence in the society. CSR is
considered inbuilt in the business existence of the traditional firms in the emerging markets like
India. However, trends in this regard are heartening with companies trying to establish strategic
alliances with the state and the civil society thus establishing the presence of CSR as an
institution in these markets.

The remaining parameters are internal to the firm involving the molding of their business
activities while incorporating CSR practices. As companies start to embrace CSR practices to a
greater extent, it leads to changes in production processes so that all environmental and societal
norms are also satisfied even thought they may not contribute to the profit maximizing objective
of the firm. This will mean that human rights agreements are also upheld taking into account the
rights of the local communities. CSR also leads to evolution of employee relations in the
company in such a way that employees become major stakeholders with definite decision
making powers especially in the area of formulation of CSR policy.

CSR and development

With the retreat of the state in economic activity in India, the imperative for business to take up
wider social responsibilities is growing. The situation is complex and India is facing a
compounded set of corporate responsibility challenges. The first generation corporate
responsibility agenda concerning conflicts between companies and communities over the control
of natural resources is widespread. Examples include struggles between rice growers and shrimp
farms, land disputes between plantation owners and indigenous communities, and resistance
from communities to mining projects.

Yet India also faces a range of second generation issues relating to hazards of industrial
production, exemplified by the 1984 Bhopal tragedy, but now encompassing a growing number
of incidents across the subcontinent where industrial air and water pollution, and the dumping of
waste is going beyond the limits of social and environmental tolerance. And, finally, as the pace
of urbanization continues and liberalization opens up India to global consumption patterns, many
of its cities are simultaneously confronting the third generation responsibility issues related to
products and services, whether they are auto pollution norms or pesticide residues in mineral
water. Whereas business cannot be expected to take on the role of governments, in a situation
where a majority of the population lives below the poverty line and has little or no access to
basic public services such as health, education, water, and electricity, and where there are a
multitude of complex sustainability challenges, CSR certainly has a potential for becoming a real
tool for developmenthuman, social, and economic.

The publics expectations of business are also growing. A TERI opinion poll in India found that
Indians feel that the business sector must play a wider and more expansive societal role. In
addition to providing good quality products at reasonable prices, companies should strive to
make their operations environmentally sound, adhere to high labour standards, reduce human
rights abuses and mitigate poverty. But the poll also revealed that people are not yet judging
companies in the marketplace according to these criteria. Developing such market-oriented
pressures could become a powerful lever for change.

One example of an initiative that emphasizes the development role of business is the Sustainable
Livelihoods Project of the WBCSD (World Business Council on Sustainable Development)3,
which aims at doing business with the poor in ways that benefit them and the company. The
success of this business model will be instrumental in shaping the future of CSR as a
development strategy.

Corporate social responsibility current scenario

Today business managers live under continuous pressure to excel or to achieve. Competitive
environment builds more and more pressure on them to adopt all such methods that might ensure
achievement of business goals. Values and ethics at this juncture become irrelevant. Hazardous
work conditions of mining corporations, cement industries, exploiting child labour in glass and
cracker industry, greedy pricing by pharmaceuticals companies on monopoly products are a few
examples. However, all companies are not alike and many have come forward for the cause of
society.

.In 2002, the top ranking companies included Johnson & Johnson, Apria Healthcare, Colgate
Palmolive and General Electric. Some other companies namely ABB, Aracruz Celulose, General
Motors, Dow Chemical, Mitsubishi Group, Novartis and Rio Tinto are also involved into the
CSR programme while moving ahead in their business. Asea Brown Boveri, the Swiss
engineering corporation, is a sponsor of the Global Sustainable Development Facility (GSDF)
and an active member of the World Business Council for Sustainable Development (WBCSD). It
is a world leader in developing eco-efficient technologies in a wide range of industry areas from
electric transmission to transportation and is building a global network to install these
technologies in many developing and transition economies. Aracruz Celulose, the world's largest
exporter of bleached eucalyptus pulp, is often cited for its efforts to promote sustainable
development through tree plantation, harvesting and pulp production, processed in Brazil.
General Motors, the world's largest automobile manufacturer is involved in various
environmental protection initiatives and partnerships. Similarly, Dow Chemical, a US
corporation was selected to participate in the GSDF for, inter alia, abiding by the highest
standards of human rights, environment and labour standard norms, as defined by UN agencies.
Mitsubishi Group has been actively cultivating an image of environmental responsibility through
advertising and specific environmental projects. Novartis, the Swiss life science corporation, is
another participant in the GSDF and member of the WBCSD. It is often cited for its efforts in the
fields of poverty alleviation and environmental protection. Rio Tinto, the British company, is
often cited for its standards of environmental reporting and for promoting continuous social
development and sustainable livelihood. CSR provides a number of advantages to business like
lowering and limiting litigation, reduction in taxes, protecting brand image, improving customer
satisfaction and reducing absenteeism, employee turnover and increasing the ability to retain
talented employees etc.
In India, Tata Group strongly favors and follows the concept of CSR, while the Reliance Group
argues strongly against it. India's largest and internationally best-known Tata group of
Companies, founded by Jamsetji Tata, believes in pioneering concept of trusteeship in
management. Benefits of the profits of many of the companies in the group are channelled back
to the people through the major philanthropic trusts, as exhibited in .
It may be observed that during recent years profits of the company exhibit a fluctuating trend but
their expenditure on society is consistent. Nearly 80 per cent of the capital of the holding
company, Tata Sons Limited, is held by these Trusts. As a result, great national institutions have
come into being in the areas of science, medicine, atomic energy and performing arts.
J.R.D. Tata, who has been instrumental in conducting the first social audit in India and perhaps in
the world, remarks, While profit motive no doubt provides main spark for any economic
activity, any enterprise which is not motivated by consideration of urgent services to the
community becomes outmoded soon and cannot fulfil its real role in modern society. Besides
Tata Group, the other companies which have adopted and followed the CSR in India are: BHEL,
Wipro, Bajaj Auto Ltd., Larsen & Toubro, Sriram Investments, Otis Elevator Co. India, ACC,
Asian Paints, Brook Bond, Colgate Palmolive, Escorts, SAIL, ITC etc. The contribution of these
companies towards CSR encompasses various initiatives like starting social trusts, anti pollution
measures, adopting villages, family planning clinics, training unemployed youth, and community
development activities etc. Further, they conduct social audits on a voluntary basis, provide
medical, recreational facilities, develop sports, undertake consumer education campaigns,
avoiding unethical and deceptive advertising and so on. Azim Premji, Chairman of Wipro, has
created enormous trust for facilitating primary and elementary education in India.
Reliance group, founded by Dhirubhai Ambani, propounds the other school of thought, which is
opposed to CSR as such. As an industrialist my job is, declared Dhirubhai, to produce goods
to satisfy the demand. Let us be clear about it. Everyone has to do his job. My commitment is to
produce at the cheapest price and the best quality. If you dabble in every thing then you make a
mess of things. If we cannot take care of our shareholders and employees and start worrying
about the world, then that is hypocrisy.
Thus, one can evidently find arguments and counter arguments in favour and against the issue of
CSR. However in Indian context, acceptance of social responsibility is no more than rededicating
ourselves to cherished values of our ancestors in the field of business. In older times, whenever
people of the country were under the social or natural problems, leading businessmen have
literally thrown open their treasure chests to provide the required assistance and help to the
needy. Gandhiji reminded us of these values, when he propounded the theory of trusteeship. As a
sequel to that, more and more companies are now realizing that they can no more function or to
be judged solely on the basis of their thick bottom-lines and fulfilling their economic objectives
only. A positive impact on employees, customers and community at large has assumed an equal
or greater significance in the overall success of the companies and building their brand image.
This realization has made them undertake socially responsive actions, which are also strongly
proponed by Vedic philosophy.