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CSR: Mahindra Rises for Good

CB Bureau9 April 2016Corporate Focus

One of the country’s more ubiquitous companies, Mahindra also happens to be one
of the most active and visible so far as corporate social responsibility (CSR) is
concerned. Much before the famous CSR ruling of the 2013 Companies Act came into
existence, Mahindra had pledged 1 per cent of its PAT to CSR activities in 2005. In
2014–15, its total CSR investments exceeded Rs 2,000 million.

Mahindra’s CSR objectives are twofold: it seeks a unified approach under its
overarching ‘Rise for Good’ mission emphasising high-impact, focused projects
targeting its chosen constituencies, while ensuring a certain degree of commitment
from every part of the organisation.

The CSR commitment

Mahindra believes that education is the key to solving the nation’s many social
problems and its CSR policy and expenditure is designed around this principle,
public health and environment being the other two important priority areas. Its
primary target groups are girls, youth and farmers, and its interventions are
constructed to benefit them – the same is articulated in its CSR vision. Aside from
this, Mahindra also invests in the following areas as part of its broader CSR outreach:
eradicating poverty and malnutrition, empowerment of women, promotion of art and
culture, initiatives for armed forces and war widows, sports, contribution towards
funds aimed at SCs/STs and other marginalised sections, technology incubation, and
rural and slum area development projects. However, as can be concluded from their
annual sustainability reports, not all of these areas witness sufficient investment of
time or resources.

The company also works in tandem with KC Mahindra Education Trust (established
in 1953), Mahindra Foundation, Mahindra Education Society, Tech Mahindra
Foundation, and Naandi Foundation. Additionally, Mahindra partners with NGOs
(subject to specific criteria) and other companies for implementation of specific
initiatives.

Aside from the standard board-level CSR committee, Mahindra also has a CSR
council reporting to it; senior executives are members of the council. The council is
responsible for evaluating and approving CSR (specifically, philanthropic) projects
that may be submitted by NGOs and other not-for-profit organisations as well. An
important principle that this council professes to follow is quality over quantity and,
hence, it constantly reviews the progress of all CSR projects. In order to do this, it
has the authority to direct the CSR department or a third-party independent agency
to carry out the required impact analysis. This council also oversees the expenditure
of 1 per cent of the total 2 per cent mandatory spend on CSR; the balance is managed
by various group companies. A separate sustainability council approves initiatives on
the sustainability front, focusing on environment, social and governance (ESG)
parameters.
Mahindra’s key CSR programmes reflect its priorities:

• Scholarships and grants: These are provided to meritorious students who face
financial constraints in pursuing their education, specifically to students from low-
income groups for vocational training or those who wish to study overseas in reputed
institutions. Notable among these are the Mahindra All India Talent Scholarships
and KC Mahindra Scholarship for Post-Graduate Studies. Some of them also get
scholarships to study in Mahindra United World College in Pune which has students
from countries across the world and is housed in a biodiversity reserve.

• Nanhi Kali: Launched in 1996 and jointly managed by KC Mahindra Education

Trust and Naandi Foundation, this is one of the flagship programmes and focuses on
education of the girl child from underprivileged sections of society. Collaborating
with 19 NGOs, it operates in nine states in India. Until 2014 more than 100,000 girls
were educated in total, and to date, over 12,000 students have completed Grade 10.
Attempts are also made to involve the larger community to which these girls belong
and educate them on the need for education and gender equality. This is especially
important as without the support of the family and society it is difficult for a girl
child from a poor household to transcend the limitations of her circumstances and
actually realise her personal ambitions. Efforts are made to track the progress of the
students who seek to pursue higher studies.
In 2015, 33 Nanhi Kalis received scholarships to undergo livelihood training at
Mahindra Namaste, where they could choose to be trained in customer relationship
management (CRM), information technology-enabled services (ITeS), or hospitality.
It goes without saying that there is tremendous potential for this number to be
significantly increased. Interestingly, many of these children are supported through
Mahindra’s own employees and the programme has seen partnerships with industry
competitors such as Capgemini – this hopefully can become a trend in CSR in India.

• Mahindra Pride schools: These provide end-to-end livelihood training in

vocational areas like hospitality, sales/CRM and IT, to young people from
disadvantaged sections, including SCs, s and, other tribes. Students are assigned
courses depending on their aptitude and interest. Launched in 2007, over 14,000
students have been trained to date with 100 per cent placement and average salaries
hovering around Rs 11,000 per month. Currently, these schools are located in Pune,
Chennai, Chandigarh, Patna and Srinagar.

• Lifeline Express: Set up in partnership with Impact India Foundation, this is the
world’s first hospital on rails and provides health services, including cataract removal
and cleft lip and deafness correction, to people in rural areas that have little or no
functioning healthcare system, servicing nearly 40,000 till the FY 2014–15.
Mahindra also regularly organises medical camps and workshops on HIV/AIDS,
dental care, etc., and runs an ambulance service in many states along with the
Emergency Management and Research Institute.
• Project Hariyali: Under this initiative, Mahindra commits to planting a million
trees every year. In FY 2014–15, over 1.5 million trees were planted.

• ESOPs: The principle behind ESOPs, or employee social options, is to make CSR a
core value of every team in Mahindra and provide a vehicle for employees to ‘give
back’. Employees are encouraged to participate in initiatives like health camps and
youth skills development through this programme—common enough among most
large corporate entities. These initiatives may be ongoing or one-time and are
typically targeted at the elderly, disadvantaged and rural populace. Many of these are
designed to cater to specific local needs, such as a 14-day programme for women in
the automotive plant in Mumbai to develop their personal skills. Since 2006, over 1
million ESOP man hours have been dedicated to various projects, a reflection of the
importance given to this programme.

• Disaster relief: Mahindra regularly makes contributions to disaster relief and

rehabilitation programmes, either through charitable funds or rebuilding necessary
infrastructure in affected areas.

• Art and culture: The company supports numerous cultural festivals in film,
theatre, and music as part of its broader effort to promote art in the country. The
Mahindra Excellence in Theatre Awards, Mahindra Blues Festival and Mahindra
Lucknow Festival are a few examples.

• Sports: At the local level, Mahindra supports community basketball and football
leagues and provides much-needed sporting infrastructure (for example, Project
Ankur in Nashik) and financial aid. Unfortunately, Mahindra United Football Club
was disbanded in 2010 despite its success and fan following. In lieu of this, the
company launched a community-based basketball league with the NBA. However,
the association had seemingly ended by 2014.

Aside from the Pride schools, Mahindra runs other schools in its areas of operation.
For instance, Mahindra Lifespaces has set up Gyandeep at its sites – Delhi, Pune,
Nagpur and Jaipur – to provide education for the children of construction workers.

In terms of analysing the impact of their interventions, Mahindra utilises milestones

and standard impact indicators. As examples, Project Nanhi Kali tracks the
improvement in learning outcomes of the girls as well as the dropout rate; Mahindra
Pride Schools monitor the placement numbers and the average starting salaries;
third-party audits are done to measure the average survival rate of trees under
Project Hariyali; and the Lifeline Express project tracks the number of surgeries
carried out and the total number of beneficiaries. It will be useful, though, if the
company discloses these numbers on a regular basis.

On sustainability
One of the core tenets of Mahindra is environment sustainability and towards this it
has invested time and resources in the past eight years, resulting in its adoption of
the triple bottom-line approach to reporting – that is, profit, people and planet. One
of its long-term goals being doubling the group’s energy productivity, Mahindra
believes that sustainability is a business driver and has strived to institutionalise it
within the company. Exemplifying this is the fact that three of its group companies –
Mahindra & Mahindra (M&M), Mahindra Finance, and Tech Mahindra – have
featured in the Dow Jones Sustainability Index 2015. M&M also has a Level 1 rating
for governance and value creation from CRISIL for three years in a row, and both
Tech Mahindra and M&M are among the top 10 companies on the Carbon Disclosure
Project (CDP) listing.

Mahindra’s current Businesswise approach to sustainability is to encourage each of

its businesses to pursue issues core to its functioning and expertise, have customised
roadmaps tailored to their specific businesses, and incentivise them to set new
benchmarks. The idea behind this is that the cascading effect from various teams will
create truly transformational change at an overall organisational and societal level
while ensuring increased focus and accountability. This method is a fallout of its
‘alternative thinking’ approach to sustainability. Yet, although there are
representatives from its various business groups within the CSR and sustainability
councils, this approach can have the unintended consequence of creating silos within
the larger entity that is Mahindra.

Targets were set for each business entity in 2013 (seemingly benchmarked with
similar organisations across the globe). Groups like the automotive and farm division
had already met its two-year targets in the first year itself, some of which included
reduction of carbon and water footprint, use of renewable power, and energy-
efficient projects. For others like Mahindra Finance and Tech Mahindra, targets
included reduction in power consumption and carbon footprint, and community
development programmes.

In a similar vein, Mahindra’s product innovation mantra is to achieve organisational

profitability, environmental responsibility, and social accountability. It seeks to
explore alternative fuel technologies, green living and large-scale solar projects.
Mahindra’s mobility products necessarily have to pass the 5C test: clean, convenient,
connected, clever, and cost-effective.
Examples
include Reva,
the GenZe
electrical
scooter, and
India’s first
CRDe tractor,
which offers
better fuel
efficiency.
Mahindra
Lifespace
Developers is
required to
construct only
green buildings
certified by
Indian Green
Building
Council (IGBC) Green Building Rating System. Mahindra Susten, which is the clean
technology arm of the group, is dedicated towards developing alternative energy. It
already has a portfolio of over 350 MW of solar projects in both utility and rooftop,
and has been instrumental in pioneering two solar solutions for consumers – the
solar generator and the DG-PV hybrid system. Its early efforts are encouraging even
though it remains to be seen if it is allowed to become a true trendsetter in the
sustainability space – after all, market economics don’t always take a long-term view.

Although a good part of Mahindra’s operations are based in Maharashtra, which is

one of the most adversely affected states in terms of drought and farmer suicides, its
farm division has been somewhat lacking in tangible responses to this crisis. The
current focus is on training farmers in modern farming practices which while
admirable aren’t exactly a solution for the millions of destitute farmers. Even then,
Mahindra happens to be one of the few companies which provide a complete set of
farm solutions and its farm division has undertaken numerous initiatives in the rural
areas. Some of those are AppliTrac, which looks at the end-to-end value chain of
farm mechanisation solutions – from land preparation to post-harvest solutions;
Samriddhi, which empowers farmers through easy access to modern farming
technologies, market linkages, and knowhow; and Vijay Vidharba, which trains
farmers in effective farming practices. One of the more innovative projects is
Mahindra MPowered Village, implemented by Mrida, a social business venture. This
involved setting up of two solar micro grids in Belwa village near Kushinagar in Uttar
Pradesh. Each household in this village, which hitherto did not have any access to
electricity (a common travesty in rural India but that’s another story), was provided
with two LED bulbs and a mobile charging point. A small connection fee and a
monthly charge go towards a Village Development Fund managed by a Village
Development Committee (VDC). Similar work has been done in Jhajjwa village as
well.

In line with its commitment towards a green environment, Mahindra regularly

spends millions on environment management (INR 63 million in FY 2014–15). This
includes waste disposal, treating chemical waste, and controlling air pollution.
Mahindra achieved ‘water positive’ status during FY 2013–14 with total water savings
of 8.4 cubic billion through the offset mechanism, and energy savings of over 102
gigajoules (one GJ is equal to a billion joules). Year-on-year reduction in ozone-
depleting substances, GHG emissions, and energy and material consumption has
also been achieved. In another sign of their commitment towards eco-friendly
practices, the head offices of Mahindra Vehicles and the Tech Mahindra campus in
Hinjewadi have been designed as green buildings with minimal usage of resources.
Reva’s manufacturing plant is India’s first IGBC platinum-rated automobile facility;
a zero water waste automobile factory has been established at Chakan. In watershed
management, Mahindra has partnered with the Madhya Pradesh government for
water and soil conservation and increasing water for irrigation to improve
agricultural productivity and green cover.

Adopting a village is another area that

the company has done some work in
although not extensively. Mahindra
Logistics has adopted a village named
Aware in Shahpur Taluka in Thane
district in Maharashtra. This includes
a three-year plan that features an
improved infrastructure, setting up of
schools, and provision of nutrition
and healthcare.

Although it is the largest NBFC operating in rural and semi-urban India, financial
inclusion is one area where Mahindra can do much more – for instance by providing
customised financial services to the poor who are generally underserved by banks.

Mahindra Foundations and achievements

The company has numerous foundations and trusts that work as its de facto CSR
arms. KC Mahindra Education Trust’s flagship programmes are Nanhi Kali,
Mahindra Pride schools, and scholarships and grants, helping over 100,000 students
in the process. Mahindra Foundation primarily focuses on disaster relief and medical
assistance and has chapters in the United States and the United Kingdom as well.
Tech Mahindra, on the other hand, works mainly on the three areas of school
education, employability, and technical education, and runs over 150 projects across
India. On the school education front, Arise is the programme through which schools
are adopted for overall improvement; Shiksha Samvardhan targets school dropouts;
and Shikshaantar works with teachers for their skill enhancement. The main
programme under employability is SMART, which works with disabled people and
underprivileged youth for vocational and on-the-job training. Currently, over 65
centres are running in 10 locations across the country.

Mahindra has been dabbling in a few offbeat projects including

the Spark the Rise Prize, which offers a $1 million award for
groundbreaking technology and scientific innovation from India.
In 2014, the first phase on solar and driverless cars was
concluded. Another untapped CSR space where Mahindra has
made inroads is funding of tech incubators which, as per the 2013
Companies Act, is classified as CSR activity. Sickle Innovations, a
farming solutions for small farmers, got Rs 18.5 lakh in CSR funding from the Rs 25
lakh grant Mahindra Financial Services made to CIIE at IIM Ahmedabad. Sustain
Earth, a start-up incubated by Villgro which is approved by the Department of
Science and Technology (DST), received Rs 23 lakh. It will be interesting to see if the
company invests in more such start ups – if it does, it will certainly be a welcome
deviation from the usual CSR practised by most Indian firms.

Closing thoughts
While Mahindra has done plenty of laudable work in the CSR and sustainability
space, opportunities for improvement remain. While a conglomerate of this size is
bound to have silos, reading about the vast number of disparate initiatives taken up
by the different Mahindra companies does make one wonder if some sort of
coordination and alignment of certain programmes might help to make them deliver
better results, allocate resources efficiently, and cut down on the low-impact, high-
investment projects. While the businesswise approach does have its merits, it is well
recognised that in CSR the emphasis should be on a limited number of high-impact,
long-term programmes, especially since the idea is to meaningfully transform the
communities that these companies work in and benefit from. There is a potential
balance that is waiting to be struck between the two approaches, which are not
necessarily antagonistic. On sustainability, while the three-year targets is laudable,
the goal should be to compare with any best-in-class company in the world when it
comes to the people and planet part of the triple bottom-line assessment. For a true
commitment towards a greener earth, moving the goalposts frequently is desirable.

While a conglomerate of this size is bound to have silos, reading about the vast
number of disparate initiatives taken up by the different Mahindra companies does
make one wonder if some sort of alignment of certain programmes might help to
make them deliver better results, allocate resources efficiently, and cut down on the
low-impact, high-investment projects. It is well recognised that in CSR the
emphasis should be on a limited number of high-impact, long-term programmes,
especially since the idea is to meaningfully transform the communities that these
companies work in and benefit from.

Interestingly, unlike his corporate counterparts in the global North, Anand Mahindra
does not believe in the Gates and Buffett school of corporate philanthropy. His take
on it is that India ‘need(s) a billion givers rather than a billion dollars by a single
giver’. One might ask if there is any reason why both can’t coexist together. Surely,
there are enough causes to which a billionaire as well as a billion givers can
contribute. While there are issues with the philanthropy of the rich
(unaccountability, too much power over democratic institutions and public policy,
etc.), it can, in a limited way, be an effective change agent.

Having supported tech incubators, it would be interesting to see if Mahindra can

come up with innovative interventions in education, which is its main focal point.
While the Nanhi Kali and Pride schools have done much good, they help individuals
and cannot be effective or scaled up beyond a certain point. For such programmes to
be truly transformative, they have to tackle the root causes of why a Pride school is
even needed and target a systemic change. This cannot be achieved solely by one
organisation, of course, but the time is ripe for some out-of-the-box solutions.
In a country where the corporate behemoths are still figuring out how to do CSR,
Mahindra is easily leading the pack. The challenge now is to set outstanding and
groundbreaking examples that can change the way we think about CSR.

P R E V I O U S A R T I C L E CSR:
Google.org’s 54 million grant to NGOs to boost 3D
technology for differently abled
N E X T A R T I C L E Interlinking of rivers, or the fallacy of development agendas

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