Corporate Social Responsibility in India

1. Corporate Social Responsibility
Corporate social responsibility may also be referred to as
“corporate citizenship” and can involve incurring short-term
costs that do not provide an immediate financial benefit to
the company, but instead promote positive social and
environmental change.
Report of Kumar Mangalam Birla Committee on Corporate
Governance constituted by SEBI (1999)
"Corporate Governance is the acceptance by management of
the inalienable rights of shareholders as the true owners of
the corporation and of their own role as trustees on behalf
of the shareholders. It is about commitment to values, about
ethical business conduct and about making a distinction
between personal and corporate funds in the management
of a company.“

2. Report of N.R. Narayana Murthy Committee on
Corporate Governance constituted by SEBI (2003)
"Corporate Governance is the application of best
management practices, compliance of law in true
letter and spirit and adherence to ethical standards
for effective management and distribution of wealth
and discharge of social responsibility for sustainable
development of all stakeholders."

3. NEED FOR CSR:
Corporate social responsibility (CSR) promotes a
vision of business accountability to a wide range of
stakeholders, besides shareholders and investors.
Some of the drivers pushing business towards CSR
include:
1.The shrinking role of government
Shrinking government resources, coupled with a
distrust of regulations, has led to the exploration of
voluntary and non-regulatory initiatives instead.
2. Demands for greater disclosure
There is a growing demand for corporate disclosure
from stakeholders, including customers, suppliers,
employees, communities, investors, and activist
organizations.

4. 3. Growing investor pressure Investors are changing the
way they assess companies' performance, and are
making decisions based on criteria that include ethical
concerns. The Social Investment Forum reports that in
the US in 1999, there was more than $2 trillion worth of
assets invested in portfolios that used screens linked to
the environment and social responsibility.
4. Competitive labor markets Employees are
increasingly looking beyond paychecks and benefits, and
seeking out whose philosophies and operating practices
match their own principles. In order to hire and retain
skilled employees, companies are being forced to
improve working conditions.

5. 5. Supplier relations As stakeholders are becoming
increasingly interested in business affairs, many
companies are taking steps to ensure that their
partners conduct themselves in a socially responsible
manner. Some are introducing codes of conduct for
their suppliers, to ensure that other companies'
policies or practices do not tarnish their reputation

6. CSR in India
The 2001 State of Corporate Responsibility in India Poll,
a survey conducted by Tata Energy Research Institute (TERI),
the evolution of CSR in India has followed a
chronological evolution of four thinking approaches:
Ethical model (1930-1950): Under this notion the businesses
were motivated to manage their business entities as a
trust held in the interest of the community.
The idea prompted many family run businesses to contribute
towards socio-economic development.
Statist model (1950-1970s): The era was driven by a mixed
and socialist kind of economy. The important feature of this
model was that the state ownership and legal requirements
decided the corporate responsibilities.

7. Liberal model (1970s-1990s): The model was
encapsulated by Milton Friedman.Corporate
responsibility is confined to its economic bottom
line. This implies that it is sufficient for business to
obey the law and generate wealth, which, through
taxation and private charitable choices can be
directed to social ends.
Stakeholder model (1990-present): The model
came into existence during 1990s as a
consequence of realization that with growing
economic profits, businesses also have certain
societal roles to fulfill. The model expects
companies to perform according to “triple bottom
line” approach.

8. Corporate social responsibility: Examples in India
Tata Group
The Tata Group conglomerate in India carries out
various CSR projects, most of which are community
improvement and poverty alleviation programs.
Through self-help groups, it is engaged in women
empowerment activities, income generation, rural
community development, and other social welfare
programs. In the field of education, the Tata Group
provides scholarships and endowments for numerous
institutions.
The group also engages in healthcare projects such as
facilitation of child education, immunization and
creation of awareness of AIDS.

9. Ultratech Cement
Companies CSR activities focus on healthcare and
family welfare programs, education, infrastructure,
environment, social welfare, and sustainable
livelihood.
The company has organized medical camps,
immunization programs, sanitization programs,
school enrollment, plantation drives, water
conservation programs, industrial training, and
organic farming programs.

10. Mahindra & Mahindra
The company primarily focuses on education programs
to assist economically and socially disadvantaged
communities. CSR programs invest in scholarships and
grants, livelihood training, healthcare for remote
areas, water conservation, and disaster relief
programs. M&M runs programs such as Nanhi Kali
focusing on girl education, Mahindra Pride Schools for
industrial training, and Lifeline Express for healthcare
services in remote areas.