Professional Documents
Culture Documents
Submitted to
submitted by
Bhavana khatwani
Semester- 2nd
Companies beside doing their business are expected to perform their social activities. The
companies should have impact on society at large. Performing social activities have great
benefits such as satisfied employees and improving reputation etc. Corporate Social
Responsibility is a management concept whereby companies integrate social and environmental
concerns in their business operations and interactions with their stakeholders. CSR is defined
and explained in companies act 2013.
Definition
Corporate social responsibility has been defined differently by different writers based on what
they perceive about the concept. Having learnt from the devastating effects of corporate social
irresponsibility, companies are focusing on the impacts of their operations not only on profits but
the society and environment at large. Therefore, corporate social responsibility refers to
"the ethical principle that an organization should be responsible for how its behaviour might
affect society and the environment"
Explaination-
The printing giant offers many programs supporting corporate social responsibility.
Their Community Involvement Program encourages it by directly involving employees. Since
1974, more than half a million Xerox employees have participated in the program. In 2013 alone,
Xerox earmarked more than $1.3 million to facilitate 13,000 employees to participate in
community-focused causes. The return for Xerox comes not only in community recognition, but
also in the commitment employees feel when causes they care for are supported by their
employers.
CSR in India has traditionally been seen as a philanthropic activity. And in keeping with the
Indian tradition, it was an activity that was performed but not deliberated. As a result, there is
limited documentation on specific activities related to this concept. However, what was clearly
evident that much of this had a national character encapsulated within it, whether it was
endowing institutions to actively participating in Indias freedom movement, and embedded in
the idea of trusteeship.
However the practice of CSR in India still remains within the philanthropic space, but has moved
from institutional building (educational, research and cultural) to community development
through various projects.
2. Philanthropy: Businesses also practice social responsibility by donating to national and local
charities. Businesses have a lot of resources that can benefit charities and local community
programs.
3. Ethical labor practices: By treating employees fairly and ethically, companies can also
demonstrate their corporate social responsibility. This is especially true of businesses that operate
in international locations with labor laws that differ from those in the United States.
4. Volunteering: Attending volunteer events says a lot about a company's sincerity. By doing
good deeds without expecting anything in return, companies are able to express their concern for
specific issues and support for certain organizations.
Communities provide the licence to operate: Apart from internal drivers such as values and
ethos, some of the key stakeholders that influence corporate behaviour include governments,
investors and customers. In India, a fourth and increasingly important stakeholder is the
community, and many companies have started realising that the licence to operate is no longer
given by governments alone, but communities that are impacted by a companys business
operations. Thus, a robust CSR programme that meets the aspirations of these communities not
only provides them with the licence to operate, but also to maintain the licence, thereby
precluding the trust deficit.
Attracting and retaining employees: Several human resource studies have linked a companys
ability to attract, retain and motivate employees with their CSR commitments. Interventions that
encourage and enable employees to participate are shown to increase employee morale and a
sense of belonging to the company.
Communities as suppliers: There are certain innovative CSR initiatives emerging, wherein
companies have invested in enhancing community livelihood by incorporating them into their
supply chain. This has benefitted communities and increased their income levels, while
providing these companies with an additional and secure supply chain.
Examples of cases where due to non-performance of corporate social responsibility loss has
occurred-
2. The Volkswagen-
The Volkswagen case represents above all an absolute failure in terms of Corporate
Social Responsibility (CSR). The company deliberately set out to design a means to
circumvent emissions controla stratagem known at the highest levelswith the aim of
giving the company an unfair advantage; meanwhile it was poisoning the planet. Car of
volkswagen poisoned the planet by emitting 40 times the legal limit of nitrogen oxide.
which is the violation of corporate social responsibility.
3. The Unilever-
Unilever settled with almost 600 workers in India over mercury exposure from a now
closed thermometer plant following a 2006 lawsuit over exposure to the toxic element.
exposed sexual harassment claims from African workers that said they had to bribe
supervisors to stop them from unwanted advances. The CEO Polmans efforts to address
the sexual harassment claims were not universally accepted by NGOs. Hence Due To
Which it suffered a great loss.
Purpose of CSR
1 Corporate social responsibility (CSR) covers the responsibilities corporations have to the
societies within which they are based and operate.
2 The aim is to increase long-term profits and shareholder trust through positive public
relations and high ethical standards to reduce business and legal risk by taking
responsibility for corporate actions.
3 CSR involves a business identifying its stakeholder groups and incorporating their needs
and values within the strategic and day-to-day decision-making process. Therefore, a
business' 'society' within which it operates, which defines the number of stakeholders to
which the organization has a 'responsibility,' may be broad or narrow depending on the
industry in which the firm operates and its perspective.
5 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.
7 CSR is a means of discussing the extent of any obligations a business has to its
immediate society and also 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.
The draft rules (as of September 2013) provide a number of clarifications and while these are
awaiting public comment before notification, some the highlights are as follows:
Surplus arising out of CSR activities will have to be reinvested into CSR initiatives, and this
will be over and above the 2% figure
The company can implement its CSR activities through the following methods: - Directly on
its own - Through its own non-profit foundation set- up so as to facilitate this initiative -
Through independently registered non-profit organisations that have a record of at least three
years in similar such related activities - Collaborating or pooling their resources with other
companies
Activities meant exclusively for employees and their families will not qualify
A format for the board report on CSR has been provided which includes amongst others,
activity-wise , reasons for spends under 2% of the average net profits of the previous three years
and a responsibility statement that the CSR policy, implementation and monitoring process is in
compliance with the CSR objectives, in letter and in spirit. This has to be signed by either the
CEO, or the MD or a director of the company
Need of CSR
Implementation of CSR
CSR strategy is the cornerstone of the business mandate and affects the bottom-line. It should
enhance reputation, build positive ties to communities, customers and the public at large. An
excellent CSR strategy should therefore showcase sustainable, effective and impactful social
responsibility campaigns. However, how can this be achieved?
1. Undertake research
Organizations need to align social responsibility strategy to business goals. CSR should create
business value by supporting initiatives that personify the business. It is not about giving
money away but rather about meeting specific societal needs aligned to the company mandate.
Research is important to define what an organization stands for. Leadership should involve all
key stakeholders in outlining the areas of focus - ultimately the process ensures buy-in.
2. Manage resources
Once the key areas of focus have been identified, it is easier to determine a realistic budget to
meet recommendations stemmed from research. Resource management is key when disbursing
funds, accounting reports should be submitted to Finance as the reporting cycle dictates.
A robust policy ensures that criteria and methods for an effective program are in place. This
will allow the organization to avail resources and information needed to support the operation
and monitoring of the program.
Once the concept and details of the CSR program have been determined, its up to you to prove
its value in terms of triple bottom line results for your company. This requires assessing and
measuring your programs impact. Develop a link between your social responsibility program
and your companys business results. How does your cause driven program impact your
companys sales, customer satisfaction, employee and brand loyalty, and market access? Prove
that your program positively impacts the company reputation and the overall profitability.
Track, measure, and communicate the impact that your program is making on the social,
environmental, and economic factors
A CSR audit to measure, monitor and evaluate the program is a must. The subsequent report
should be published for accountability. This process legitimizes an organizations involvement
in corporate citizenry
Conclusion-
We can conclude that CSR is a great need for companies to grow in society. CSR involves
various social activities done by companies other than the business and profits activities. The
CSR envisages that the group evolves and executes strategies to support communities in
partnership with governments, civil society and relevant stakeholders. It can be implemented
with a due process. And performing CSR activities can greatly help you to improve your
company reputation employees satisfaction human resources etc however not adopting corporate
social responsibility can prove harmful for company.