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CORPORATE SOCIAL RESPONSIBILITY
TO REFLECT FOR FEW MOMENTS…
I have failed over and over again in my life. And that is why I succeed…… Michael Jordan
The mind is not a vessel that needs filling but wood that needs lighting…….. Plutarch
WHAT IS CSR
Commitment of a business to contribute to sustainable economic development, working with employees and their families, the local community and society at large to improve their quality of life in ways that are good for business and good for development
INFLUENCES ON CSR
Two major concepts – Stakeholder’s model and triple bottom line
Bottom line : Financial, Social, Environmental Thus, CSR can also be defined as operating a
business in a manner that meets or exceeds the ethical, legal, commercial and public expectations that society has of business
Evolution of the concept of Corporate Citizen
FRIEDMAN DILEMMA
Suggested that corporate executives could either strive for profits or go hearing about chasing social causes
The two were inimical to each other as social responsibility was nothing less than unadulterated socialism
Corporate philanthropy was allowed for but only after profits were properly secured
For Friedman corporate philanthropy is all right, but anything resembling CSR is letting the shareholders down
EVOLUTION OF LATE…
Shift from viewing CSR as synonymous with philanthropy to socially responsible investing
Shift from spending a portion of profits for charitable purposes to create an impression of caring for others to taking up responsibilities in societal development activities
CSR must have a business perspective without being obsessed by profits
INFOSYS’S CAMPUS CONNECT
Started in 2004, it is a unique industry-academia initiative that aims to overcome this by creating a vibrant pool of future engineering graduates
“It is our way of walking the talk on building the much-needed link between industry and academia. The focus is on enhancing the industry readiness of the students coming out of our educational institutions” – Krish Gopalakrishnan, CEO and MD
It has been normal practice for most IIT graduates to leave Indian shores for greener pastures in developed nations like the US or Europe facing a severe talent crunch in India. With Campus Connect, Infosys aims to solve the problem
BOSCH
The world’s largest private industrial giant and a billion dollar corporate has done more than its share for the country since 1951
It started an apprenticeship program in 1960 Infusing professionalism into India’s industrial
sector, 500 trained apprentices from Bosch have been bridging the skill gap for companies across the globe every year for almost 50 years
The students have gone on to become industrialists, or managing directors, such as R Ramakrishnan, CMD of GMR Agro-Business
ELEMENTS OF CSR
Desired of business by society
Expected of business by society
Required of business by society
ACTION PLAN FOR CSR – ENVIRONMENT AND ECOLOGY
Reduce consumption of energy, water, and other natural resources and emission of hazardous substances
Establish environment management system Use recycled and recyclable products Increase durability of products and minimize
packaging Train staff in environmental issues
HEALTH AND WELL BEING
Establish policies to ensure the health and safety of all employees – which are known to employees
Involve employees in business decisions that affect them
Operate open book policies Consult employees on how to handle a
downturn in business if layoffs are unavoidable, offer outplacement services, retraining and severance benefits, provide training opportunities
Extend training to life management, retirement planning and dependants’ care
DIVERSITY AND HUMAN RIGHTS Work with charities, job centers to redesign
jobs to make them accessible to the disadvantaged
Set the tone in not tolerating sexists, racists, and homophobic jokes
Support organizations that promote fair trade and human rights compliance
Make sure that staff members are aware that there are explicit policies against discrimination in hiring, salary, promotion, training or termination of any employee on the basis of gender, race, age, ethnicity and disability
COMMUNITY Encourage employee volunteering in the community
payroll giving and back up with financial contributions and help in kind
Make some of business products or services available free or at a cost to charitable products
Look for opportunities to make surplus products and redundant equipment available to local schools charities and community organizations
Offer quality work experience for school children and students
Collaborate with local teachers to make the activity of business the subject of school projects. Use business experience to help local school charity
Use marketing budget to associate business with social cause
SOME BENEFITS OF CSR
Enhanced brand image Employee retention Reduced operational costs Increased community support…
BUSINESS IMPORTANCE OF CSR
Improved financial performance Reduced operating costs Enhanced brand image and reputation Increased sales and customer loyalty Increased productivity and quality Increased ability to attract and retain
employees Reduced regulatory oversight
ARGUMENTS FOR CSR
Balancing corporate power with corporate responsibilities
Discouraging the creation and imposition of government regulations
Focusing on social problems
ARGUMENTS AGAINST CSR
Stakeholders bear the costs of corporate social action (shareholders, employees and consumers) which affect a “corporation’s operating efficiency and weaken competitive position and advantage”
Mismatch of the roles and expectations between the organization and society
Prospects of corporation becoming even more powerful, as they may already exercise considerable power over society
Management is trained in functional areas of management and does not have generic expertise in handling social issues
UN GLOBAL COMPACT
Certain principles provided by Mr. Kofi Annan, UN Secretary General in 1999
Focus is on labor standards, human rights and environment protection
SOCIAL ASPECTS OF CSR
Human rights Labor Consumer protection Respect for national sovereignty and local
communities
DRIVERS OF CSR
Values
Strategy
Public pressure
THREE MODELS OF CSR
1. Competency Driven2. Community Driven3. Consumer Drive
COMPETENCY DRIVEN
Company reaches out to the society by depending on its core competencies
In doing so, it helps create potential stakeholders, and also adds to evolving higher efficiency standards
COMMUNITY DRIVEN CSR
Organizations invest in social welfare but again with a business interest
Idea is to subscribe to a sustainable form of CSR
CONSUMER DRIVEN
Consumer pressure has made a great difference in sensitizing companies to the needs of stakeholders
CSR can also help in raising consumer standards and expectations
In this process not only is the consumer benefited, but the company too can hike up the competition in its own market sector