- 1. asserting on the increasing importance of effective
corporate governance in India at the 4th Subir Raha Memorial
Lecture organised by Global Compact Network India on 1st July 2013.
The Subir Raha Memorial Lecture is an annual event held to honour
Late Mr. Subir Raha, Founder President, Global Compact Network
India (GCNI) and Former CMD, ONGC. Mr. Raha set up the GCNI in
November 2003 and led it till May 2006. His vision and foresight,
has led GCNI to establish itself as a legal entity, the first one
among the many networks initiated by the United Nations Global
Compact since 2000. The event is a solemn occasion where we pay our
respect and homage to a great leader and visionary, whose
initiatives have led to the thinking on responsible business
practices in India. In his memory, an annual lecture series was
started by Global Compact Network India (GCNI) in 2010 and since
then, three memorial lectures have been organised by GCNI. Mr.
Sinha in his lecture onExpanding Paradigm of Corporate
Governancehighlighted that the practice of transparency,
effectiveness and ethical operations are the keys to win trust of
4th Subir Raha Memorial Lecture Presidents Desk Dear Members
Welcome to GCNIs new tri-annual Newsletter, NUTSHELL. As we near
completing a decade of operations, Global Compact Network India is
steadily engaging with Corporate Indiatowards adopting responsible
and sustainable business practices. The progress has admittedly
been rather modest; but we realise that such radical change is slow
and gradual and persist with our outreach agenda of disseminating
relevant information and hand holding early believers. While we
have a year long agenda, a few prominent activities during this
period are mentioned below. nutShellVol. 5 Issue 1 April-July 2013
T he G C N I n d i a T ri - annual N ewsletter Both in social and
political life demands for good governance are being made from
completely unexpected quarters. You will find that questions are
being raised from corners which nobody could have imagined, even 5
years earlier, said Mr. U.K. Sinha, Chairman, SEBI in the News in
focus Meetings 2nd India CEO Forum Meeting | 2 12th Working Group
Meeting | 3 Launch of Bangalore Chapter | 3 Publication on Fraud
and Bribery | 4 UNGCs ALNF Meeting and Training Programme | 6 9th
Annual General Body Meeting | 6 Strengthening Ethical and
Transparent Corporate Governance | 6 Companies Act 2013 An
Interview with Mr. Ashok Kumar Pavadia, Joint Secretary, Department
of Public Enterprises, Ministry of Heavy Industries & Public
Enterprises, Ministry of Industry, GoI | 7 Monthly Meetings | 11
Inthisissue Contd. on page 2... Contd. on page 2...
2. 2 | Vol. 5 | Issue 1 | April-July 2013 nutShell newsin the
The forum was organised in Bangalore at the Infosys Campus and was
attended by CEOs/ CMDs and Senior Managerial Personnel from the
leading companies such as Infosys, TCS, JSL, Mahindra and Mahindra,
Elcomponics Ltd., Tata Steel, GBI, Coca Cola Ltd., IHRB, Tata
Chemicals, ACC Limited, ITC, Total Oil Limited, academicians from
Welingkar Institute of Management, Xaviers Institute of Management
and Entrepreneurship and O.P. Jindal Global University and UN
Women. The Forum reconvened this year and based its discussions on
the theme of Growth with Dignity, Respect and Accountability. The
meeting was an attempt to initiate a dialogue among Indian business
leaders on exploring the implementation of the United Nations
Protect, Respect, Remedy framework within the Indian context. It
focused on discussing around how the companies and businesses
through their commitment and action oriented strategies for
promoting human rights could foresee gaining the trust of people
and a competitive position in the corporate world. The meeting
included presentations and sharing by the business leaders about
their attempts at forwarding the human rights principles in their
respective workspaces and a panel discussion facilitated by Mr.
Mark Hodge, Executive Director, Global Business Initiatives on
Human Rights, with Mr. Salil Tripathi, Director of Policy, IHRB,
Prof. J Philip, President, XIME, Prof. Raj Kumar, Vice-Chancellor,
O.P. Jindal Global University and Mr. Kris Gopalakrishnan,
Executive Vice Chairman, Infosys, on Shared Responsibility Protect,
Respect, Remedy in the Indian context. The event also witnessed the
release of the year one report of the India CEO forum on Business
and Human Rights. the investors. He asserted that through effectual
corporate governance the company can win economic advantages in the
medium to long term, which not only is rewarding to the company but
also the shareholders. Mr. Sinha elaborated on the laws and
guidelines that are being drafted by SEBI to provide companies with
the necessary guidance to ensure that good corporate governance
norms and culture is followed and that investors, especially the
small investors, are provided due credit. The event also witnessed
a welcome speech by Mr. Sudhir Vasudeva, President, GCNI and CMD,
ONGC, theme setting 4th Subir Raha Memorial Lecture 2nd India CEO
Forum Meeting Respect for human rights in business leads to
expansion of our democratic values into the realm of economics and
business, said Mr. Narayana Murthy, Chair, India CEO Forum on
Business and Human Rights and Chairman Emeritus, Infosys Limited,
speakingattheSecondCEOForumonBusinessandHumanRightson2ndApril2013.
...Contd. from page 1 speech by Ms. Lise Grande, UN Resident
Coordinator and UNDP Resident Representative in India and vote of
thanks by Dr. Uddesh Kohli, Senior Adviser, UNGC and Executive
Member, GCNI. The event was well attended by CMDs and CEO and
Senior Managerial Personnels like Dr. S.P.S. Bakshi, CMD, EPIL; Mr.
Bharat Wakhlu, Resident Director, Tata Services - Tata Group; Mr.
B.P. Tayal, CMD, Konkan Railways Corporation and Dr. A.K. Balyan,
MD & CEO, Petronet LNG including 250 other participants from
private and public sector companies, non-governmental organisation
and academic institutions. Presidents Desk ... Contd. from page 1
We had the pleasure of hosting Mr. U.K. Sinha, Chairman, SEBI at
the 4th Annual Subir Raha Memorial Lecture on 1st July 2013. He
addressed over 300 participants on the subjectExpanding Paradigm of
Corporate Governance, in which he emphasised the increasing need
for transparency and accountability from corporate and business
houses. GCNI launched its 5th chapter in Bangalore recently to
engage more effectively with companies located in the Southern
States to bring them into the GCN fold. Considering Indias vast
geographical spread, it will be necessary to open up more chapters
to engage effectively with Indian business houses. Collective
Action Project (CAP) launched its second publication Understanding
the Demand and Supply Equations of Corruption and Fraudto help
understand push and pull factors leading to fraud and to suggest
practical preventive solutions. We are also pleased to report that
GCNI won the Foreign and Commonwealth Offices Prosperity Fund India
Programme bid for the new project onStrengthening Ethical and
Transparent Corporate Governance for a period of 18 months. The
Global Compact Network Indias elections brought together a new
Governing Council (GC) for the term 2013-2015. It is mix of the old
guard and new incumbents and will enhance diversity in thought and
perspective in implementing our ambitious strategic plan. The
future holds great promise as initiatives such as the recently
enacted new Companies Bill and enhanced emphasis of agencies such
as SEBI toward transparency and protecting the right of minority
shareholders will encourage Indian business entities toward
adopting global management and compliance templates. This will
surely enhance opportunities for us to engage with our partners,
patrons and members on the ten principles of the compact movement.
I look forward to your continued support in implementing GCNIs
agenda. 3. 3 | Vol. 5 | Issue 1 | April-July 2013 nutShell Launch
of Bangalore Chapter Taking place in New Delhi, India, the 12th
Meeting of the UN Global Compact Working Group on the 10th
Principle was held in collaboration with the Global Compact Network
India on 9-10 April 2013. Approximately 125 executives of
international and local businesses, high- level officials from the
Government of India, representatives of business organisations,
civil society, and academia were convened to discuss best ways to
advance the fight against corruption through collective action, and
identify challenges and opportunities for businesses to scale up
existing anti-corruption corporate action. On the first day,
participants reflected upon ways in which corporations can
contribute to advance anti-corruption efforts. Specifically,
companies, government officials, and civil society in India
showcased their efforts, and discussed what incentives can be
offered to further strengthen the existing efforts. Additionally,
participants also reviewed the role of collective action in
tackling corruption risks in various countries, and Global Compact
Local Networks from Germany, India and Nigeria as well as the
Egyptian Junior Business Association highlighted their efforts. The
meeting also examined a crucial role that Information and
Communications Technology (ICT) can play in combating corruption,
and showcased how the ICT can be better used to increase access to
information and transparency. Furthermore, Call to Action, a
year-long global campaign, was launched during the 12th Meeting.
The Call to Action invites companies to express their support of
anti- corruption in relation to the UN Post-2015 Development
Agenda. The Call to Action urges governments to promote incentive
mechanisms for corporate anti-corruption action. 12th Working Group
Meeting Mr. Amar Patnaik, Accountant General (General and Social
Sector Audit) set the tone of proceedings of the day by saying
Sustainable development has to take place on the plank of good
governance. On the second day, working group participants engaged
in the interactive session where they discussed some of the
challenges in implementing anti- corruption compliance programmes
throughout their value chain. The group also identified priorities
for the Working Group to advance the anti-corruption and business
agenda. The 12th meeting concluded with a joint session with the
World Economic Forums Partnering Against Corruption Initiative WEF
PACI. The joint session provided an opportunity to update the
latest developments that each initiative is focusing on, and
reinforce the spirit of collaboration towards the common goal of
advancing in the fight against corruption. The 13th Meeting of the
UN Global Compact Working Group will be held in New York City at UN
Headquarters in December 2013. Global Compact Network India
launched its fifth local chapter in Bangalore on 2nd April 2013.
The launch marked the expansion and extension of the Global Compact
Movement in India. Mr. Narayana Murthy, Chairman Emeritus, Infosys
Limited launched the chapter along with Mr. Salil Tripathi,
Director Policy, IHRB; Mr. Mark Hodge, Executive Director, GBI;
Prof. J. Philip, President, XIME; Prof. C Raj Kumar,
Vice-Chancellor, O.P. Jindal Global University; Mr. Kris
Gopalakrishnan, Executive Vice Chairman, Infosys Limited;
Ms.SushmaKapoor,DeputyRepresentative,UNWomenandMr.Pooran Chandra
Pandey, Executive Director, GCNI. The launch document was also
signed by CMDs/CEOs and Senior Managerial Personnel from reputed
corporates, business houses and academic institutes. 4. 4 | Vol. 5
| Issue 1 | April-July 2013 nutShell newsin the The publication was
first showcased on 20th June 2013 at the high level B20 Summit in
St. Petersburg, Russia. Thereafter it had a media launch in New
Delhi and was covered by 18 newspapers/magazines, with more
promising to do a follow-up story in coming weeks. Some major
newspapers and magazines that covered the report were The Economic
Times, Business Standard, Financial Express, First Post, The Indian
Express, Governance Now, Zee Biz, among others. Both qualitative
information and quantitative data were considered at the data
collection stage to obtain a holistic understanding of the
underlying information. The overall objective of the analysis was
to gain an insight into the nature of fraud, type of companies
involved, the trends in corporate fraud, the underlying
characteristics and techniques used, factors motivating the
fraudsters etc., and to present the data and its interpretations in
a meaningful manner. The report included a sample of over 100
companies indicted by the Serious Fraud Office, over a period of 15
years from April 1997 to March 2012. In the event that an
investigation has been conducted by multiple agencies, all the
available Publication on Fraud and Bribery
CollectiveActionProjectIndiareleaseditssecondpublicationtitledUnderstandingtheDemandandSupply
EquationsofCorruptionandFraudinJune2013.ThispublicationwasdevelopedinpartnershipwithThought
ArbitrageResearchInstitute. information from each such agency was
considered. Information was obtained from charge sheets, court
orders, filings with stock exchanges, specific databases
supplemented by web searches, searches of newspapers and journals,
Lok Sabha questions and answers etc.The report is an attempt to
look at the evidence available and compile facts and nuances
surrounding this complex issue. It is an attempt to move away from
the emotive appeal of the anti-corruption and anti-fraud stand to
explore the subject dispassionately so that a platform of dialogue
and possible solutions can be created. In the words of Georg Kell,
Executive Director of United Nations Global Compact, The Indian
private sector has shown immense potential to foster a transparent
and sustainable economic environment. I am optimistic that we can
collectively triumph against corruption and fraud by forging a
collaborative relationship between government and business. Mr.
Kell emphasised that collective action is the way forward, as
businesses cannot grow in isolation as well as their fight against
corruption and fraud will not be impactful if they dont work
together. 5. 6 | Vol. 5 | Issue 1 | April-July 2013
nutShellnutShell The 9th Annual General Body Meeting was held on
1st July 2013 at Scope Convention Centre, Scope Complex, Lodhi
Road, New Delhi. The AGM witnessed the announcement of the new
Governing Council headed by President, Mr. Sudhir Vasudeva, CMD,
ONGC. The member companies and organisations of GCNI met to
deliberate on issues with regard to the plan of action for the next
1 year including the consideration on the annual report and audited
accounts. Strengthening Ethical and Transparent Corporate
Governance 9th Annual General Body Meeting newsin the Mr. Pooran
Chandra Pandey, Executive Director, GCNI attended Annual Local
Network Forum (ANLF) and special training conducted by UNGC on
Partnership during 21st -26th April, 2013. The Annual Local Network
Meeting discussed various issues, in particular, about more
engagement between UNGC and Local Networks including joint
programmes, new ways to attract more membership for both UNGC &
local networks, finding strategies and rolling out a new strategy
by the UNGC for the year 2014-2016. UNGC also proposed that India
Network should work closely with the UNGC both in India and outside
as it is one of the fastest growing networks in the UNGC family and
proposed joint projects and programme on sustainability, social
enterprises, and other UNGC initiatives UNGCs ALNF meeting and
Training Programme besides proposed regional meeting in India in
the first quarter of 2014. Mr. Pandey also at the ANLF meeting in
Geneva interacted with senior people from the corporate, other
local networks and senior members of the management at the ILO. He
also met Sir Mark Moody and Mr. Georg Kell of the UNGC and
discussed with them key issues and areas of mutual interest and
understanding. Global Compact Network India worked on a Project
Proposal titledStrengthen Ethical and Transparent Corporate
Governance Practices and Further Responsible Developmentwhich was
submitted to the Foreign and Commonwealth Offices Prosperity Fund
India Programme disbursed by the British High Commission. We are
happy to inform that Global Compact Network India won the bid for
the Project and began work in earnest from July 2013. This Project
is part of a wider goal of mainstreaming Anti-corruption Collective
Action in the development agenda of India. At GCNI this work began
with Siemens Integrity Initiative supporting the Collective Action
Project from January 2011, and with this Ethical Corporate
Governance project coming in, the agenda has gotten further
strengthened. The purpose of this new project is to build a
national collective action platform for responsible and sustainable
development through informed partnerships with the business
community, bureaucrats, civil society and parliamentarians. This
will be done by facilitating constructive dialogue and bridging the
gap in knowledge of how public and private businesses can engage
with government, and set a collective agenda. Indian businesses are
already witnessing a rise in ethical and transparent governance
practices. The proposed Project will further strengthen this
initiative by bringing together senior stakeholders, in business
and bureaucracy, to take forward the collective agenda of
transparency and responsible development forward. A tangible output
will be that at least 8-10 companies based in India will sign the
United NationsCall for Action: Anti- corruption and the post-2015
Development Agenda. http://www.unglobalcompact.org/Issues/
transparency_anticorruption/call_to_ action_post2015.html 6. 7 |
Vol. 5 | Issue 1 | April-July 2013 nutShell focusIN Q.1 The Act is
the first of its kind to make Corporate Social Responsibility (CSR)
a mandatory provision. Do you see this as an effective step in
ensuring that the CSR activities are actions undertaken beyond
cheque book philanthropy? Ans.1 The provisions of the new Companies
Act per se do not ensure that corporate enterprises would not
indulge in philanthropy in the garb of discharging their corporate
social responsibility. The new Companies Act only makes it
mandatory for companies beyond a particular threshold of profit,
net worth, or turnover, to ensure that 2% of their profits are
spent on CSR activities. How the money is to be spent is not
specified in the Act. This will have to be spelt out in the rules
to be framed under this Act by the Ministry of Corporate Affairs.
Schedule VII of the new Companies Act gives an indicative list of
activities which may be taken up under CSR by companies. The rules
formulated under the Act will have to specify that the companies
cannot simply donate money to charitable institutions which engage
in such activities. DPEs present guidelines on `CSR and
Sustainability, which are effective since 1st April 2013, however,
clearly advise the CPSEs not to spend CSR funds on philanthropy.
The guidelines make it very clear that at least 80% of the CSR and
Sustainability funds have to be spent on activities in a project
mode, which entails advance planning, mobilisation of resources,
allocation of budget, fixed timelines for different stages of
implementation, and accountability of officials / agencies
entrusted with execution of different tasks. Since CSR activities
are to be implemented in a project mode by CPSEs with close
involvement of their management in planning, implementation,
monitoring and impact assessment stages, the chances of CSR getting
relegated to cheque book philanthropy gets drastically reduced, if
not completely eliminated. I would like to clarify here that DPEs
present guidelines on CSR and Sustainability would now have now to
be reviewed and slightly modified in the light of the provisions of
the new Companies Act and the rules framed thereunder. Q.2 How
would you respond to the criticism regarding CSR being made a
mandatory requirement as per the Act? Do you feel there is a
difference of reaction between public and private reaction? Ans.2
Under the Companies Act, it is not mandatory for all companies to
undertake CSR activities. Section 135 of the new Companies Act
states that only those companies which have a net profit of over
Rs. 5 crores, or a net worth of over Rs. 500 crores, or a turnover
of over Rs. 1000 crores in any financial year shall ensure that at
least two per cent of their average net profits of the preceding
three years is spent on CSR activities. In case they are unable to
spend that amount, the Companies Act 2013 Under the Companies Act,
it is not mandatory for all companies to undertake CSR activities.
Section 135 of the new Companies Act states that only those
companies which have a net profit of over Rs. 5 crores, or a net
worth of over Rs. 500 crores, or a turnover of over Rs. 1000 crores
in any financial year shall ensure that at least two per cent of
their average net profits of the preceding three years is spent on
CSR activities. Essential that the philosophy of CSR is infused in
the DNA of the companies An interview with Mr. Ashok Kumar Pavadia,
Joint Secretary, Department of Public Enterprises, Ministry of
Heavy Industries & Public Enterprises, Ministry of Industry,
GoI reason thereof would have to be explained. Thus, all companies
are not covered under the provision of mandatory spending on CSR;
the coverage of companies is limited by the prescribed thresholds
of profit, net worth or turnover. Moreover, even for those
companies which are covered in the Act, the approach seems to be of
`comply or explain. But we will have to wait for the formulation of
rules under the Act to be clear about the mandatory aspect of CSR
spending by companies. Unfortunately, some Companies still perceive
CSR as a drain on their resources, as something which nibbles on
their profits, or which drills a hole in their pocket. Therefore, I
personally feel that some private companies may not react very
enthusiastically to the CSR provisions of the Companies Act,
largely because they may not fully understand the concept and
philosophy of CSR and its relevance and importance in the
contemporary world of business. They may perhaps fail to understand
that what is good for society and environment can also be good for
business. 7. 8 | Vol. 5 | Issue 1 | April-July 2013 nutShell Q.3
Coming back to the legal provisions, while making CSR a mandatory
legal requirement, it does not establish penalties for
non-compliance. Do you believe this would hamper the implementation
of the clause on CSR? Ans.3 I do not subscribe to the view that the
threat of penalties alone can ensure sincere compliance. I am
personally not in favour of penalties. Perhaps incentives may
produce better results. More importantly, we should attempt to
change the mind- set of the management of the companies. Only when
they realise the relevance of CSR and its enormous benefits for
business, society and environment, will they take up CSR activities
voluntarily, with full passion, and in right earnest. It is
essential that the philosophy of CSR is infused in the DNA of the
companies. Once CSR is internalised in the organisations culture,
ethos, operations and processes, its sincere implementation by
companies would be assured. Q.4 What do you envisage would be the
role of Independent Directors with regards to the CSR policy of the
company? Ans.4 The inclusion of an independent director as a member
of the Board level committee on CSR is a welcome step. The presence
of independent directors on the Board is widely acknowledged as
enhancing their efficiency, enriching their deliberations, and
thus, improving corporate governance. It is a general perception
that at times Boards are under pressure to take up activities which
are either not valid CSR activities, or are not aligned with the
business policies and strategies of the company. Independent
Directors can assist the Boards in resisting such pressures.
Besides, they can enrich the quality of decisions taken by the
Board by bringing in outsidersvision and perspectives on CSR. DPEs
present guidelines on `CSR and Sustainabilityare in consonance with
the provisions of the new Companies Act in that the presence of an
Independent Director on the Board level committee on CSR and
Sustainability has been made mandatory for CPSEs. We have, in fact,
gone a step further by stipulating that in case an Independent
Director is not a member of the Board level committee on CSR and
Sustainability, the entire amount allocated for such activities
would be transferred to a Sustainability Fund which is contemplated
to be created separately for CSR and Sustainability activities.
This provision is meant to bring pressure on the CPSEs to ensure
that an Independent Director is definitely inducted as a member of
the Board level committee on CSR and Sustainability. Q.5 The
Companies Act, currently excludes large number of Small and Medium
Enterprises (SMEs) from its purview. Given that these SMEs
contribute around 17 per cent of the total GDP and employ around 40
per cent workforce in India, do you think the current Act needs to
include them? Ans.5 I personally think that all companies
regardless of their size or profit margins have a duty to discharge
their corporate social responsibility. Small and Medium Enterprises
(SMEs), and even the loss making companies are expected to conduct
their business in a socially, economically and environmentally
sustainable manner. Companies with small or no profit may not be
able to take up CSR projects and activities due to financial and
resource crunch. But, surely, they can More importantly, we should
attempt to change the mind- set of the management of the companies.
Only when they realise the relevance of CSR and its enormous
benefits for business, society and environment, will they take up
CSR activities voluntarily, with full passion, and in right
earnest. It is essential that the philosophy of CSR is infused in
the DNA of the companies. Once CSR is internalised in the
organisations culture, ethos, operations and processes, its sincere
implementation by companies would be assured. The present DPE
guidelines on `CSR and Sustainabilityare to a very large extent in
consonance with the provisions of the Companies Act in this regard.
And, in my opinion, public sector enterprises in comparison to the
private companies better understand the concept and philosophy of
CSR. One, because for quite some time now they are used to spending
a portion of their profits on CSR activities. DPE guidelines on CSR
issued in 2010, and the revised guidelines issued in 2013 make it
mandatory for Central Public Sector Enterprises (CPSEs) to
undertake CSR activities. Of course, many CPSEs have been willingly
doing a lot of commendable work under CSR even prior to the issue
of DPE guidelines. More importantly, the extensive campaign carried
out by DPE in the last couple of years to engage all the key
stakeholders in a dialogue on CSR and Sustainability to sensitise
them, especially the management of CPSEs on the relevance and
importance of CSR has apparently paid rich dividends. Due to the
persistent efforts of DPE, there is a widespread awareness of CSR
and Sustainability in the public sector, and CSR initiatives taken
by CPSEs have acquired the dimensions of a big movement in the
corporate world. 8. 9 | Vol. 5 | Issue 1 | April-July 2013 nutShell
I also feel that by simply confining CSR to just spending 2% of the
profits of a company, we may be taking a moribund view of the
scope, dimensions, and potential of CSR, and severely restricting
the space in which it can operate. imbibe the philosophy and spirit
of CSR in their organisational culture, and adhere to the
principles of UN Global Compact in their internal functioning. I
also feel that by simply confining CSR to just spending 2% of the
profits of a company, we may be taking a moribund view of the
scope, dimensions, and potential of CSR, and severely restricting
the space in which it can operate. According to DPE guidelines,
even in their internal operations, their mainstream activities, and
in their routine budgetary spending, CPSEs are expected to be
conscious of their corporate social responsibility and reflect it
in the goods and services which they produce. Q.6 How do you look
at the leadership of the Global Compact, one of the largest CSR
initiatives, with regarding to enforcing the clause of the new
Companies Act? Ans.6 I think UN Global Compact principles are very
pragmatic and useful for Businesses of all types. As a part of
their CSR, Corporates should implement these principles in their
internal organisational structure and in dealing with
externalities, including all providers in the supply chain.
However, this aspect will have to be mentioned in the rules which
are framed under the provisions of the new Companies Act. As far as
DPEs present guidelines on CSR and Sustainability are concerned, it
has been very clearly mentioned therein that CPSEs can seek
guidance from the principles of UN Global Compact in formulating
their CSR and Sustainability policies. Q.7 What are the major
challenges that you feel would be pertinent from the point of view
of the corporates and their compliance with CSR provisions of the
act? Ans.7 The real challenge would be in the implementation of CSR
provisions of the Act. The devil always lurks in the implementation
part. The resistance which may emanate from the companies would
mainly arise due to their lack of understanding of the concept and
philosophy of CSR and its relevance in the business world. A lot
will also depend on how the rules are framed under the provisions
of the new Companies Act. Framing of rules itself would be a
challenge. 9. 10 | Vol. 5 | Issue 1 | April-July 2013 nutShell
Secretary Mr. S. Satish Rao Additional General Manager Bharat Heavy
Electricals Limited President Mr. Sudhir Vasudeva Chairman &
Managing Director Oil & Natural Gas Corporation Treasurer Mr.
H. D. Gandhi Chief Manager HR Indian Oil Corporation Limited
Special Invitee Mr. Chandrajit Banerjee Director General
Confederation of Indian Industry Vice President Northern Region Dr.
S. P. S. Bakshi Chairman-cum-Managing Director, Engineering
Projects India Limited (EPIL) Co-opted Member Mr. C. S. Verma
Chairman Steel Authority of India Special Invitee Dr. A. Didar
Singh Secretary General Federation of Indian Chambers of Commerce
and Industry Vice President Eastern Region Mr. R. Mohan Das
Director - Personnel & IR, Coal India Limited Co-opted Member
Dr. A. K. Balyan Managing Director & CEO Petronet LNG Special
Invitee Mr. D. S. Rawat Secretary General The Associated Chambers
of Commerce and Industry of India Vice President Western Region Ms.
Beroz Rumie Gazdar, Sr. Vice President - Group Sustainability
Mahindra & Mahindra Limited Member Dr. Uddesh Kohli Chairman
Emeritus, Construction Industry Development Council Member Mr.
Anoop Kumar Mittal Chairman-cum-Managing Director, National
Buildings Construction Corporation Limited Member Dr. Vinod Singh
Vice Chairman CCLP Worldwide India Member Brig. Rajiv Williams
Corporate Head CSR Jindal Stainless Limited Co-opted Member Dr. Joy
Deshmukh Global CSR Head Tata Consultancy Services Special Invitee
Ms. Rekha Sethi Director General All India Management Association
Vice President Southern Region Mr. N. K. Nanda Director (Technical)
NMDC Limited Special Invitee Dr. U. D. Choubey Director General,
Standing Conference of Public Enterprises Governing Council of
Global Compact Network India 2013-2015 10. 11 | Vol. 5 | Issue 1 |
April-July 2013 nutShell June 2013 Role on Affirmative Action
through Corporate Action: Role of India Inc. in Inclusive Growth
Global Compact Network India jointly with NACDOR organised the
round table conference onRole on Affirmative Action through
Corporate Action: Role of India Inc. in Inclusive Growthon 28th
June. The meeting witnessed a theme setting speech by Mr. Bharat
Wakhlu, Resident Director, Tata Services - Tata Group and
discussion on the role of corporates in affirmative action. Some
key speakers at the event included Dr. Uddesh Kohli, Senior
Adviser, UNGC; Mr. Ashok Bharti, Chairman, NACDOR; Dr. Serge
Younes, Senior Consultant, Accenture and Mr. Pooran Chandra Pandey,
Executive Director, GCNI. July 2013 The Strategic Necessity of
Corporate Social Responsibility and Business Sustainability Indian
Oil Corporation hosted the July Monthly Meeting on the themeThe
Strategic Necessity of Corporate Social Responsibility and Business
Sustainabilityon 30th July 2013. The meeting included a
presentation onThe Strategic Necessity of Corporate Social
Responsibility and Business Sustainabilityby Mr. Bibhuti Pradhan,
CM (HR), Indian Oil Corporation Limited, and on Business
Sustainability by Mr. Vinod Pandey, General Manager - Government
Affairs, BMW India Pvt Ltd. The presentations focussed on the
necessary importance of CSR and sustainability in business
operations. Some eminent dignitaries at the event included Mr. Lee
Bee Sen, Executive Director (HR & CSR), Indian Oil Corporation
Limited, Dr. S .P. S. Bakshi, Vice President (Northern Region),
GCNI & CMD, Engineering Project India Limited (EPIL) and Mr.
Ashok Kumar Pavadia, Joint Secretary, Department of Public
Enterprises, Government of India. meetingsMonthly May 2013
Advancing Social Integration and Intergenerational Solidarity
Global Compact Network India jointly with SERFAC organised the book
launch and panel discussion on the themeAdvancing Social
Integration and Intergenerational Solidarityon 15th May 2013. At
the event, the book titledFamily: Heart of Humanitywas launched by
Honourable Justice Leila Seth, who in her address drew the
attention towards the importance of the book to scholars and
development practioners. The event also included a panel discussion
on the themeAdvancing Social Integration and Intergenerational
Solidarityand was informed by dignitaries and experts such as Mr.
Soli Sorabjee, Former Attorney General of India; Prof. Dr. Reeta
Sonawat, Professor and Head Human Development, SNDT Womens
University; Dr. Lalit Kumar, Adviser, Voluntary Action & Youth
Affairs, Planning Commission; Dr. Uddesh Kohli, Senior Adviser,
UNGC; and Col. Prakash Tiwari, Head CSR, Jindal Steel & Power
Ltd. April 2013 Women Empowerment Initiative in India - Gender
Equality Means Business Global Compact Network India organised its
April Monthly Meeting on 20th April on the themeWomen Empowerment
Initiative in India Gender Equality Means Business. The event
witnessed a key note address by Ms. Tine Staermose, Director, ILO
Decent Work Team for South Asia and Country Office for India, and
presentations onWEPs Initiative in Indiaby Ms. Subhalakshmi Nandi,
Womens Economic Empowerment Specialist, UN Women, onWomens
Empowerment Principles by Ms. Rashmi Singh, Executive Director,
Gender Equity and Diversity CARE India and by Dr. Manju Karla
Prakash, Executive Director, FICCI Ladies Organization (FLO). 11.
13 | Vol. 5 | Issue 1 | April-July 2013 nutShell eventsUpcoming
Global Compact Network India jointly with Deloitte, has conceived a
significant training programme on Sustainability and Corporate
Governance for the member companies. The training programme has
been designed to train the members on key sustainability and CSR
frameworks and sharing of best practices across sustainability and
CSR, value chain and its linkages with the UNGC principles. The
training would also enable informing the CSR and sustainability
mandate of the organisation and mapping and aligning it with the
UNGC principles requirements. The training would be carried out in
6 Indian cities namely; Delhi, Mumbai, Kolkata, Bangalore,
Hyderabad and Chennai during September and October 2013 and will be
facilitated by trainers from Deloitte with considerable experience
in sustainability domain. Held every three years, the Leaders
Summit is the premier UN-business event bringing together chief
executives with leaders from civil society, Government and the
United Nations. The largest gathering of its kind, the Leaders
Summit represents a unique opportunity for Global Compact
participants to discuss corporate sustainability strategy at the
highest level, and produce strategic recommendations and action
imperatives for the future of the initiative. The Leadership Summit
for the year 2013 is scheduled to be held on 19th and 20th of
September 2013 in NewYork. Chaired by UN Secretary-General Ban
Ki-moon, the Leaders Summit Architects of a Better World will link
the enduring, universal values of the United Nations with a new
global architecture for corporate sustainability. As the Millennium
Development Goals 2015 deadline approaches, the Summit will set the
stage for business to shape and advance the post- 2015 development
agenda putting forward architecture for business to contribute to
global priorities at unprecedented levels. Global Compact Network
India jointly with expert advisers and specialists, from the United
Nations Global Compact and Pacific Institute, New York has
conceptualised the India Collaboration Lab with the aim to convene
social entrepreneurs, NGOs, corporations, investors and
policy-makers in an action-oriented event to identify and design
initiatives to scale innovations that increase the access to
quality water and sanitation services in India. The collaboration
lab has been designed to concentrate and deliberate on themes
highlighted in Indias 2012 National Water Policy, build upon the
strategies advanced at the March 2013 CEO Water Mandate Corporate
Water Stewardship Conference, develop engagement strategies and
demonstrate multi-stakeholder collective action. The programme to
be organised in New Delhi during 22nd and 23rd October 2013, is a 1
day event for Chief Executive Officers, Executive Directors, Chief
Sustainability Officers, Founders, Managing Directors,
policy-makers and others who are ready to align with a diverse set
of stakeholders and act in collaboration to increase the
effectiveness and reach of water and sanitation projects in India.
The Rio+20 Conference in Rio de Janeiro, Brazil outcomes have
brought in renewed focus on the imperative for the business
fraternity to channelise their resources and integrate
sustainability concepts across the value chain. It also offers a
unique opportunity for a concerted effort in creating a sustainable
future. GCNI and BMW in line with this agenda are organising the
India Sustainability Dialogue on 15th November 2013 in New Delhi.
The event intends to create a platform to engage key stakeholders
in constructive deliberations on sustainability related challenges
and recommendations to solve it. The platform will provide for
sharing of good practices followed across various sectors.
Sustainability and Corporate Governance Training in Partnership
with Deloitte Mumbai, Bangalore, Hyderabad, Chennai, Kolkata and
New Delhi UN Global Compact Leaders Summit New York, USA India
Sustainability Dialogue New Delhi India Collaboration Lab New Delhi
12. 14 | Vol. 5 | Issue 1 | April-July 2013 nutShell 4th Subir Raha
Memorial Lecture Post event release Annual Report Yearbook on
Monthly Knowledge and Sharing Meeting A situation Paper on
Strengthening Transparent and Ethical Corporate Governance to
Further Responsible Development publicationsUpcoming eventsUpcoming
International Symposium on Business Ethics, Transparency and
Compliance: Need for Responsible Management Approach would be
organised by Collective Action Project at Global Compact Network
India, in partnership with United Nations Principles of Responsible
Management Education. The Symposium will be hosted by Canara Bank
of Management School, Bangalore University on their campus in
Bangalore on October 30, 2013. The symposium would explore
following sub themes Rethinking Business Ethics in wake of emerging
regulatory framework across different contexts Experiences in
managing transparency and anti-corruption in the organisations
(2008 onwards) Small and Medium Enterprises (SMEs) in the
contemporary Anti-Corruption discourse Transparency and ethics
interface with corporate strategy The nexus between Corporate
Strategy and Business Responsibility Beyond Compliance: Expanding
the canvas of business responsibility in emerging India Conflict of
interest and its impact on transparent management of business
functions Whistle-blowing and loyalty issues in the organisations.
Global business is vastly more complex than the simple act of
selling a product or service to a consumer. Business is
accomplished through the elaborate networks of the supply chain the
persons, entities and infrastructure that transform materials and
human capital to intermediate and finished products and services
for customers and consumers. The problem of corruption affects
every business in the supply chain, so all must work together to
tackle this problem. As the news media regularly reports, the
misdeeds of suppliers can directly affect a customers product and
service quality. At the same time, suppliers who may themselves be
large MNCs. Thus all businesses need to attune themselves to the
problems of corruption in order to protect their own products,
services and reputations. A National Consultation on Supply Chain
Transparency and Sustainability would be held in Mumbai in November
2013 to deliberate on the above issues and come up with basic
guidelines. This National Consultation would be in partnership with
mJunction and run concurrently with Intermodal India, a logistics
tradefair. UNGC working group on the 10th Principle against
Corruption is a multi-stakeholder issue specific body which steers
anti-corruption activities globally. The group on the 10th UNGC
principle on anti-corruption was launched after the introduction of
this principle in 2004. This Multi-Stakeholder working group
facilitates a discussion amongst businesses, provides guidance to
the Global Compact and most importantly it ensures alignment of
various anti-corruption initiatives. The 12th Working Group Meeting
was held in New Delhi on April 2013. CAP India will actively engage
with the 13th Anti-Corruption Working Group Meeting to be held in
New York on International Anticorruption Day i.e. December 9, 2013.
International Symposium on Business Ethics, Transparency and
Compliance: Need for Responsible Management Approach Bangalore
National Consultation on Supply Chain Transparency and
Sustainability Mumbai 13th Working Group Meeting New York, USA 13.
15 | Vol. 5 | Issue 1 | April-July 2013 nutShell Membership
Benefits KEY BENEFITS OF JOINING GLOBAL COMPACT NETWORK INDIA
Global Ethical Framework: Any stakeholder joining GCNI enters into
a Global Ethical Framework by embracing universal principles on
Human Rights, Labour, Environment and Anti-corruption long
recognised by governments all over the world but not yet
universally implemented. Induction, Training and Communication of
Progress: Companies are provided by way of briefing and training
activities to the key staff on what it means to be part of the UNGC
and how they can contribute to their organisations CSR activities
and other initiatives which cover broadly the ten principles of
UNGC. Assistance is also provided to companies in preparing their
annual Communication of Progress (COP) as part of their commitment
to the principles of UNGC. Integrated Platform: The network
provides a high- impact collective action platform by way of
Knowledge Sharing and Network Meetings; Regional Conclaves and
National Convention in which leaders from all over the country
representing various sectors meet to address and explore how
collective action can create incentives for ethical business
performance and on some of the most urgent social and environmental
challenges of our times. It also strengthens corporate citizenship
and develops partnership projects to the achievement of the
Millennium Development Goals. Publication and Communication: Create
a window of opportunity for the stakeholders to share their good
practices to a larger global audience by way of publishing in
Annual UNGC documents and through electronic communication by means
of UNGC & GCNI websites. Participation in the Governance of the
Network, including election to the Governing Council or becoming
member of subject sub-committees which would bring in varied
stakeholders on board and add vibrant leadership, visibility and
credibility to the organisation. Collective Action Project on
Anti-corruption and Green Economy provides an enabling platform at
the country level where different stakeholders address various
issues related to corruption. Further, it acts like a forum to
share information and experiences and find way and means to
collectively fight against corruption and mitigate challenges
related to environment. Representation through State, National and
International Forums: GCNI is a pan India membership driven
network, state chapters bring in not only the existing but
potential stakeholders to actively take part in the activities and
initiatives of GCNI. Stakeholders are provided with opportunities
to represent GCNI in National and International Forums. Global
Compact Network India One of the key elements of the UNGC
initiatives is the existence of business led multistakeholders
platforms of local networks which provide an opportunity for
members to share experiences, innovative practices and collaborates
for furtherance of responsible business values within country
specific contexts. The Global Compact Network India was formed by
the UNGC participant companies from India. It was registered in New
Delhi in November 2003 as a Non-Profit Society to function as the
Indian Local Network of the Global Compact Programme, functioning
within a globally recognised and established initiative with a pan
India membership base. Global Compact Network (GCN) provides an
extremely relevant vehicle for Indian Companies- Large & SME,
Academic institutions and Civil Society organisations to join hands
towards strengthening responsible business initiatives in India and
internationally. Why Join Global Compact Network India Today when
the most progressive companies are focusing on CSR, Global Compact
is the right platform to demonstrate nationally and internationally
the commitment to CSR and ethical working of the companies.
Voluntary guidelines on CSR by Ministry of Corporate Affairs lay
emphasis on almost the same core issues as advocated by UNGC.
Department of Public Enterprises has also issued guidelines on CSR
for CPSEs which make a reference to UNGC. There are four categories
of members in the network: 1. Corporate Members (Companies /
Corporations) 2. SME Members (Small & Medium Enterprises) 3.
Institutional Members a) Non-Profit Making Societies b) Trusts c)
Educational and Research Institutes d) Govt. Departments 4. NGO
Members a) Civil Society b) Non-Government or Labour Organisations
Membership fees Membership Category Entrance fees (in Rs.) Annual
Fees (in Rs.) Lifetime Membership (in Rs.) 1 Corporate Members Upto
` 500 Crores in the preceding year 25,000 25000 2,50,000 2 Above `
500 Crores 50,000 50,000 5,00,000 3 SME Members 10,000 10,000
1,00,000 4 Institutional Members 10,000 10,000 1,00,000 5 NGO
Members 10,000 10,000 1,00,000 *A service tax of 12.36% would be
applicable on the above mentioned fees structure. 14. About Global
Compact Network India The Global Compact Network India was formed
in November 2003 and was registered as a non-profit society to
function as the Indian local network of the UN Global Compact
programme. It is the first local network in the world to be
established with full legal recognition. Global Compact Network
India (GCNI) is a country level platform for businesses, civil
society organisations, public sector and aids in aligning
stakeholders practices towards the Ten Universally Accepted
Principles of UNGC in the areas of Human Rights, Labour,
Environment and Anti corruption. At present, the India network
ranks among the top 3, out of the 101 local networks in the world,
and has emerged as the largest corporate citizenship and social
responsibility organisation in the country with a pan India
membership of 126 organisations, who have strengthened their
commitment to the UNs Global Compact Principles by becoming proud
signatories of the local network, GCNI. The Global Compact Network
India Office Scope Complex, Core 5, 6th Floor (ONGC Office), 7
Institutional Area, Lodhi Road, New Delhi Email: [email protected]
www.globalcompact.in Disclaimer: This publication is intended
strictly for learning purposes. The inclusion of company names
and/or examples does not constitute an endorsement of the
individual companies by the Global Compact Network India Office.
The material in this publication may be quoted and used provided
there is proper attribution. DesignedandPrintedby:RootsAdvertising
The Ten Principles of the United Nations Global Compact Human
Rights Principle 1: Businesses should support and respect the
protection of internationally proclaimed human rights; and
Principle 2: make sure that they are not complicit in human rights
abuses. Labour Principle 3: Businesses should uphold the freedom of
association and the effective recognition of the right to
collective bargaining; Principle 4: the elimination of all forms of
forced and compulsory labour; Principle 5: the effective abolition
of child labour; and Principle 6: the elimination of discrimination
in respect of employment and occupation. Environment Principle 7:
Businesses should support a precautionary approach to environmental
challenges; Principle 8: undertake initiatives to promote greater
environmental responsibility; and Principle 9: encourage the
development and diffusion of environmentally friendly technologies.
Anti-Corruption Principle 10: Businesses should work against
corruption in all its forms, including extortion and bribery.
