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CSR AUDIT OF DAV COLLEGE MANAGEMENT COMMITTEE By Alexey Tarasov, Harmanjot Mangat, Prabhjot Mehrok.
Contents1 Introduction.........................................................................................................................................3
1.1 Corporate Social Responsibility...................................................................................................3
1.2 Company Profile..........................................................................................................................3
1.2.1 Mission Statement...............................................................................................................4
2 Methodology.......................................................................................................................................4
3 CSR Audit.............................................................................................................................................7
3.1 Environment................................................................................................................................7
3.2 Customers....................................................................................................................................7
3.3 Human Resources........................................................................................................................8
3.4 Community..................................................................................................................................9
3.5 Human Rights..............................................................................................................................9
3.6 Business Behavior and Ethics.....................................................................................................10
3.6.1 Relations with Clients, Suppliers and Sub-Contractors......................................................10
3.6.2 Prevention of Corruption...................................................................................................10
3.6.3 Marketing Practices...........................................................................................................10
3.7 Corporate Governance and Reporting.......................................................................................11
3.8 Stakeholder Communication.....................................................................................................11
3.8.1 Staff....................................................................................................................................11
3.8.2 Customers..........................................................................................................................11
3.8.3 Government.......................................................................................................................11
3.8.4 Community and Media......................................................................................................12
4 Results of Audit..................................................................................................................................12
4.1 Strengths...................................................................................................................................12
4.2 Weakness...................................................................................................................................13
4.3 Opportunities.............................................................................................................................13
4.4 Threats.......................................................................................................................................14
1
5 Action Plan.........................................................................................................................................14
5.1 Increase the Internal Awareness...............................................................................................14
5.2 Compensation and Benefits.......................................................................................................15
5.3 Green Buildings..........................................................................................................................15
5.4 Eco-Friendly Transportation......................................................................................................15
5.5 Establish CSR Committee...........................................................................................................15
5.6 Increase Transparency...............................................................................................................16
5.7 Provide Sex Education...............................................................................................................16
5.8 Establish Whistle Blower System...............................................................................................16
6 References.........................................................................................................................................18
7 Appendix 1.........................................................................................................................................21
2
1 Introduction
1.1 Corporate Social Responsibility According to Gelbmann(2010) the importance of CSR has been increasingly recognized in
modern enterprise. Small and medium enterprises all are featuring CSR performance, but they
fail to gain competitive advantage out of it because they are unaware of the qualities of CSR.
Gelbmann in his research paper mentioned two approaches of CSR: a) comprehensive scope
which basically focus on Social, economic and environmental issues b) dynamic view which
integrate the intangible resources such as capabilities and competencies. Other authors such as
Haastrecht & Amiabel (2010) explained CSR as a balanced approach towards the concept of
‘value’. It is a weighted average of current wealth, welfare & future generations. CSR operation
has been explained mostly with the views of two economists: Milton Friedman and Freeman.
According to Friedman the only social responsibility of business is to generate profit. But
Freeman emphasized that all stakeholders’ interest has to go together. According to freeman
successful business is the one which is creating value for customers, suppliers, employees,
communities and financiers.
1.2 Company ProfileDAV College Managing Committee (DAVCMC) is the largest Non Government Organization
(NGO) with 120 years of experience in the field of education in India. DAV operates over 700
educational institutes which consists of public schools, DAV aided schools, degree and
professional colleges and research institutes. Most of the DAV Institutes are ISO 9001-2008
certified (DAVCMC, 2010).
3
1.2.1 Mission Statement
According to DAV College Management Committee, 2010 “Education for all, keeping in mind
the elimination of disparities in the educational system and provision of more facilities through
qualitative interventions” in order to achieve this mission of quality of education for all,
DAVCMC has laid some objectives which are spreading education, demote superstitions and
out-dated customs like child marriage, female foeticide, dowry, gender-bias etc. and promoting
individuals towards social welfare. The vision of DAVCMC is to continue to expand as a
knowledge leader and content provider. The futuristic vision of DAVCMC is to expand with
global relevance by use of IT to provide e-administration and e-services (DAV College
Management Committee, 2010).
2 MethodologyTo assess the CSR level of DAVCMC, our team conduct the CSR audit by using B Impact
assessment created by certified B corporation. The B Corporation rating system has been
divided mainly into five main parts which are Accountability, Employees, Consumers,
Community, Environment and Beneficial Business Model
1) Accountability: Focusing in governance and transparency issues of the company, the
maximum points for this section is 15 points, the governance and transparency issues of
the report ask questions about company Mission, governing body and engagement of
external stakeholders etc.
2) Employees: It focus on companies relationship with employees and also top understand
how they treats their employees, this section contains 60 points, in which 3 sub-sections
4
which are Compensation & Benefits, Employee Ownership and Work Environment
accounts
3) Consumers: In this section, the company will be evaluated based on Beneficial Products
or Services criterion with the maximum grade of 35 points. It demonstrates the benefits
which the customers of DAVCMC gained from them.
4) Community: 4 sub-sections are Suppliers with 5 points, Local with 14 points, and
Diversity with 13 points and Charity with 13 points. The total grade for this section is 45
points.
5) Environment: With the maximum of 20 points, 2 sub-sections which are Facilities and
Energy Usage accounts for 14 points and 6 points accordingly.
Apart from the five assessment criteria’s the B corporation assessment also include
Beneficial Model which is further divided into four parts which are Employee Benefit
Model, Consumer benefit model, Community benefit model and environment benefit
model. DAVCMC has a community benefit model and it is giving benefits to under-
deserved community .The corporation has also got environment benefit model.
In order to do the B assessment we need lot of internal information about DAVCMC .The
information was collected by:
1) Telephone interview: Phone calls has been made to DAVCMC head-office New Delhi,
India, There we talked with Mr S.K. Sharma (Director Publications) and Mr A. Adlakha
(Director Administration) and we explain them about B-corp. assessment required
for CSR certification .From them we got the information of no. of employees and
approximate revenues of DAVCMC. Besides them we called Mr. Kochar who is
5
Director of DAV Institute of Engineering and Technology Jalandhar and asked him
about the college engagement with local community and the social activities which
the college is doing. Calls have also been made to Professor of same college Mr.
Ramandeep Johal, Mrs Geetika Jasuja Principal at DAV Public School Kurukshetra,
Mrs Deepa Chawla teacher at DAV Public School Kurkshetra and Mr. Bhupinder Singh
phone operator at DAV Public School. They provide us information about institute
working conditions, pay scale, health benefits, bonuses, remuneration and other
paid/unpaid holiday etc. Mr Kochar helped us in filling the answers to B assessment.
In order to assist him to answer the survey, we explained the content, meaning and
purpose of each section and the questions if necessary. After completion of survey
we as auditors and he as representative to DAVCMC got the result which is shown in
appendix 1.
2) Email: In order to answer questions of the survey we email Mr Kochar B-Corporation
link for approval.
3) DAVCMC website: we got lot of information which includes company mission and
vision statement, corporation coming event regarding CSR, practices they are
following to diminish the social evils from society and also corporation’s beliefs
regarding environment from company website.
4) School and college website: DAVIET Jalandhar and DAV Public School Kurkshetra
website about the local community activities they participate in.
6
3 CSR Audit
According to phone calls to different personals, DAVCMC is involved in several pillars
concerning CSR activities which are explained as below:
3.1 Environment The DAV schools take special care to make the students aware and conscious of their
environment. DAV is one of the top leaders in planting the trees across the India. Every year all
institutes of DAV celebrate World Environment day by planting trees in schools, colleges and
neighborhood, besides the students they also encourage society to aware of pollution problems
which is threat to environment. The paper in schools is used carefully and is recycled (DAV
College Management Committee, 2010). DAV Schools are carrying out various campaigns like
van-mahotsav (forest day), say no to poly-bags, say no to fire-crackers. They regularly carry out
water conservation and anti-pollution campaigns etc. (DAV College Management Committee,
2010)
3.2 CustomersThe customers of DAVCMC are in wide range of age groups from little children to people of any
age who are willing to get education or want their children to be educated. DAVCMC is coping
up with National Literacy Mission of India they are taking education to people if they cannot
come to schools. DAVCMC has some social welfare schemes which include educating students
from weaker sections of society like tribal people, mentally challenged children of society (DAV
College Management Committee, 2010). Parents of the students of schools are customers of
the institution too who participate in the volunteer work initiated by DAVCMC during the
7
national crisis like earthquakes, tsunami and wars by donating cash and other volunteer
services (DAV College Management Committee, 2010).
3.3 Human ResourcesAdlakha, A., 2011 in a phone conversation stated that there are approximately 70,000 people
working in all the institutions under DAVCMC with an annual budget of about $45,000,000 (Rs.
2 Billion). According to Chawla, D., 2011 in a phone conversation stated that the work
environment of the school is extraordinary and she can reach her full potential. The job is
defined by some rules but she has freedom to experiment new ideas to teach which are
appreciated by the administration of the school. Singh, B., 2011 in a phone conversation said
that he gets a lot of benefits even being a peon in the school. He said even though it is one of
the lowest positions in the school he gets travel allowance, daily allowance etc. he said he is
directed to switch off extra lights and fans in the school when they are not in use. Employees
are appreciated for participating in social activities like promoting some good cause or bringing
poor children to school who cannot afford education as stated by Jasuja, G., 2011 who is
principal in DAV Public School Kurukshetra. According to DAV College Management Committee,
2010 teachers and lecturers in various institutes are sent for in job training to improve their
skills which helps in developing their career. They are also encouraged to get Ph.D.s during
assisting other professors (DAV Engineering College, 2011). Post retirement employees get
provident funds with some additional funds from DAVCMC (DAV College Management
Committee, 2010). There are no pension plans offered from DAVCMC but employees invest in
private pension plans (Chawla, D., 2011). Female employees get 2 months of paid maternity
leave and can get up to 2 months of paid sick leave but there is no paternity leave (DAV College
8
Management Committee, 2010). There is no provision for home allowance for temporary
employees which is drawback for employees from other cities or states (Adlakha, A., 2011).
3.4 Community
According to DAV College Management Committee, 2010 DAVCMC is acting towards
community development. DAVCMC provide education to women and suppressed communities.
DAVCMC also opened Ashrams (Shelter homes), orphanages, and research institutes and are
promoting adult education. DAVCMC also does favor to community by hiring staff from local
communities. DAVCMC also pay for marriages of poor women. DAVCMC with the help of Red-
Cross society organizes blood camps and does other social work by providing free education to
children who cannot afford education. DAVCMC provide free food on special occasions.
DAVCMC also gives away tricycles to handicap people in the community. DAVCMC has a special
quota for women and candidates from underprivileged communities in their job selection
process (DAV College Management Committee, 2010). Some institutions organize workshops to
educate parents on parenting techniques and other community welfare workshops are
arranged (DAV Public School Kurukshetra, 2011).
3.5 Human RightsAccording to DAV College Management Committee, 2010 employees working in DAV institutes
have freedom of association they have DAV Employees association and have rights for
collective bargain. According to Singh,B., 2011 during the phone conversation stated that there
is no forced labor or child labor in the school payroll but some children work in canteens in the
school which are under independent contractors it means some institutions are infringing some
human rights. Teachers can be force students to do anything against their will if any teacher
9
does anything like beating or harsh punishment to force students to do something against their
will then they are subjected to criminal offence and actions are taken accordingly. Any teacher
found guilty in such an offence is boycotted from DAVCMC (Adlakha, A. 2011).
3.6 Business Behavior and Ethics
3.6.1 Relations with Clients, Suppliers and Sub-ContractorsAccording to Jasuja, G., 2011 the suppliers are from local community and DAV institutes have
very good reputation in community so the suppliers provide discounts to the schools for bulk
order and good-will discounts as all the payments are done prior to time. Parents of the
students in the school are invited to the school on last Saturday of every month for their
feedbacks and which are evaluated and worked upon. Students have direct access to the
principal’s office if they have any complaints or any concerns regarding the operation of the
school.
3.6.2 Prevention of CorruptionAccording to Adlakha, A., 2011 if any employee is caught in any activity related to corruption his/her
employment is suspended till charges against the employee are proved if the employee is found guilty is
terminated from his position right when the charges are proved. DAVCMC is very strict for preventing
corruption. Adlakha, A., 2011 also stated “the reason these employees are paid well is that they don’t
work against the ethics of humanity.”
3.6.3 Marketing PracticesDAVCMC does not have any particular marketing strategies the main means of marketing for DAV
institutes is through word of mouth as it is a very old institution and well know in Indian history (Jasuja,
G., 2011). Sharma, S., 2011 “Go see our website, alumini of DAV institutes includes 2 Vice-Presidents of
10
India, 3 Prime Ministers of India, 1 Nobel Prize winner is our marketing we don’t need to do any
marketing.”
3.7 Corporate Governance and ReportingBoard of Directors of DAVCMC consists of 40 members that include President, Vice Presidents,
Secretaries and Hony. Treasures. Annual audits are commenced to measure employee
performance and individual institutional performance which are then published in circulation to
the institutes and are accessible to employees. Financial reports are not published so they lack
the factor of transparency in terms of finance (DAV College Management Committee, 2010).
3.8 Stakeholder Communication
3.8.1 StaffThere is open communication with staff in the institution as they are accessed on the basis of
the performance of their students which results in appreciation or counseling sessions for the
improvement of their performance. Other employees have direct access to the heads of the
institutions for any concerns.
3.8.2 CustomersThe communication between customers i.e. students and their parents and company are very
open they can communicate either in written form through applications or daily dairies of
students or in oral form through telephones or any other legitimate means as Jasuja, G., 2011
suggested.
3.8.3 GovernmentThe communication between institutions and government is an open communication as many
institutions of DAVCMC are government aided so the communication is an important part. The
11
communication between government and institution is through publication of documents to
each other (Adlakha, A., 2011).
3.8.4 Community and MediaAccording to Adlakha, A., 2011 the communication with media is filtered every news is given to
media but sometimes some information is kept confidential. Adlkha, A., 2011 also stated that if
any event or any incident related to community happens is reported to media which further
reports that to community or other stakeholders. According to Jasuja, G., 2011 if any
employees of any institution of DAV is found involved in any criminal or unethical practices are
communicated to community through media and also the actions against the employee are
communicated. Jasuja, G., 2011 added that the communication with community and media is
fairly transparent.
4 Results of AuditIn the following section, the B-lab audit result for DAVCMC will be discussed. All the
strengths and weaknesses of the company will be analyzed in order to provide
recommendations for future improvement. The B report result certification is included in
Appendix 1.
4.1 StrengthsDAVCMC did well in Community involvement, corporate governance, and environment; by
conducting interviews with various employees of different DAV institutes it was found that they
are strongly satisfied with DAVCMC. DAVCMC did very well in promoting awareness of
environment; almost all DAV campuses have lush green gardens and they also provide
transportation facility for staff and students at very reasonable prices that encourages the use
12
of this facility instead of bringing their own vehicles also the company has engaged with its
suppliers, business partners, or customers to lessen the negative influences on the
environment. Community involvement is considered as strongest strength of DAVCMC as
already discussed in Community involvement section.
4.2 Weakness The B-corporation assessment shows that DAVCMC has some weaknesses because the
DAVCMC scores less in some areas such as transparency, work environment and energy usage.
For the transparency, the DAVCMC does not have a formal procedure to share its financial
information. In compensation and benefits DAVCMC don’t provide any major premiums for
health insurances for employees and neither for their families. The pension funds are only
partial funded as already explained in human resource section. Employees are not shareholders
in the company. Working environment of major DAV Institutes is not up to high standards as
during power cuts they sometimes lack to provide power backup also there are only few
premises which provide facilities for disabled .Company gained very less score in energy usage
as most of the premises are constructed more than 40 years ago and they are still using old
fans, lightening and air conditioning.
4.3 Opportunities
The assessment results show that there are various areas in which there is need of
improvement for DAVCMC. DAVCMC can have formal and written policies in various areas such
as:
a) Policy on how to facilitate the financial information sharing.
13
b) Construct new buildings according to Green building concept and LEED(Leadership in
energy and environmental design)
In addition, the company should provide more benefit to its employees such as health
insurance, more paid day-off for the volunteer work which employees did. Also company
should improve Energy backup system by installing Renewable energy resources equipments.
Besides that in order to assist disabled persons, DAVCMC should install elevators and automatic
doors in their premises.
4.4 Threats
The major threat to DAVCMC is Government owned school and colleges as the government
provide their employees with pension plans, health benefits not only for them but also for their
families. Also recently in India central Government revised the pay scales of their employees so
in order to capitalize their employees DAVCMC also has to revise their pay scales ,which in turn
increases their expenses. The other threat to DAVCMC is boom in the market of Private schools
and colleges which are providing their clients and employees world class facilities and modern
education.
5 Action Plan
5.1 Increase the Internal AwarenessIn order to have sustainable development, DAVCMC should increase the internal awareness
among employees, customers and management regarding CSR. It can organize trainings,
seminars and expert lecturers for employees and students on sustainable development and
how to implement. DAVCMC should also introduce environmental and social responsibilities as
14
mandatory subject for student’s .To increase awareness, DAVCMC should also build CSR
responsibilities into employees’ job performance evaluation, Appreciate employees and
students with awards and benefits, recruit people who have voluntary experiences.
5.2 Compensation and BenefitsDAVCMC should provide employees with paid day off for the time they spend volunteering for
the institutions in social activities. They should also provide paternity leaves to their employees
that create ease for taking care for their family and their children. Apart from compensation
DAVCMC should provide health benefits and housing for employees or assistance in residential
planning to the employees who came from other cities or states. DAVCMC should tie up with
banks in order to assist their employees with mortgages and loans.
5.3 Green BuildingsThey should modify their old buildings to meet the requirements of Green Building concept as
they are very old buildings. They can change their existing electric appliances with energy
efficient appliances such as LED lighting, CFC free air conditioners. They should install automatic
sensors in buildings to save energy, water saving appliances in washrooms, big windows and
insulated walls and windows.
5.4 Eco-Friendly TransportationInstead of using diesel engines in their buses they should use hybrid buses which run on CNG
this will benefit environment as it will reduce the CO2 emission and other harmful gases.
5.5 Establish CSR CommitteeDAVCMC should establish a CSR committee at corporate level which will consists of
representatives from management who can act as chairman and participants from different
15
institutes who can be considered as internal auditors. An external consultant should also be
hired for this committee. This committee will examine the performance of different institutes
related to CSR. This committee will take these issues to the management. CSR committee
should commence a CSR audit every year and should publish the report to all stakeholders.
5.6 Increase Transparency DAVCMC should increase transparency by publishing the financial reports and other audit
reports to every stakeholder.
5.7 Provide Sex EducationDAVCMC should provide sex education in school curriculum to increase AIDS awareness in
students as according to UNICEF, 2010 in 2009 the estimated population living with AIDS in
India was 28 million so AIDS awareness is important in future generations.
5.8 Establish Whistle Blower System“Organizations including governments and professional associations, are concerned with
finding ways to encourage and allow employees to report acts, both of omission as well as
commission of corporate malfeasance or wrongdoing” which is called as whistle blowing
( Moody et al.,pp:90,2008),Other Authors such as Arnold & Ponemon pp: 2 (1991)defined
Whistle blowing as “disclosure by organizational members of illegal, immoral, or illegitimate
practices under the control of their employees, to persons or organizations that may be able to
effect action.” According to our research, DAVCMC hasn’t established a whistleblower system
yet. This system will resolve issues related to CSR from employees and customers perspective. It
will consist of anonymous emails and boxes. By this system DAVCMC will able to find out the
problems and then they can do corrective and preventive measures in order to resolve the
16
problems. In terms of this system, DAVCMC can conduct training and development about the
whistleblower system so that management and employees understand and are familiar with its
procedures.
All these actions may increase the short run cost but it will help save the long run cost and
add to company revenues by achieving 100 % employee & customer satisfaction.
17
6 References1. Adlakha, A., 2011. Director Administration DAVCMC, (Telephonic Communication, 10
June, 2011).
2. Arnold, D. and Ponemon, L., 1991, Internal Auditors’ Perceptions of Whistle-Blowing
and the Influence of Moral Reasoning: An Experiment, Journal of Practice and Theory,
10(2), pp. 1- 16.
3. B Lab, 2011, Certified B Corporation, [Internet] Available at:
<http://www.bcorporation.net> [Accessed on 8+- June, 2011]
4. Chawla, D., 2011. Teacher DAV Public School Kurukshetra, (Telephonic Communication,
13 June, 2011).
5. DAV College Managing Committee, 2010, DAV College Managing Committee, [Internet]
Available at: <http://davcmc.net.in/index.html> [Accessed on 10 June, 2011]
6. DAV Institute of Engineering and Technology Jalandhar, 2008, DAV Institute of
Engineering and Technology [Internet] Available at: <http://davietjal.org> [Accessed on
10 June, 2011
7. DAV Public School Kurukshetra, year-unknown, DAV Public School, Kurkshetra [Internet]
Available at: <http://www.davkurukshetra.org/home.do> [Accessed on 10 June, 2011]
18
8. Friedman, M. (2007). `The Social Responsibility of Business Is to Increase Its Profits'. In
W. C. Zimmerli, M. Holzinger, & K. Richter (eds.), Corporate Ethics and Corporate
Governance, chap. 14, pp. 173-178. Springer Berlin Heidelberg, Berlin, Heidelberg.
9. Gelbman, U., 2010, Establishing Strategic CSR in SMEs: an Austrian CSR Quality Seal
to Substantiate the Strategic CSR Performance, Sustainable Development, 18, pp. 90-
98.
10. Haastrecht, B. and Amiabel, M., 2010, The Strategic Importance of Corporate Social
Engagement, Journal of Sponsorship, 3(3), pp. 260-264.
11. Jasuja, G., 2011. Principal DAV Public School Kurukshetra, (Telephonic Communication,
13 June, 2011).
12. Johal, R., 2011. Assistant Professor DAV Institute of Engineering and Technology
Jalandhar, (Telephonic Communication, 8 June, 2011).
13. Kochar, C., 2011. Director DAV Institute of Engineering and Technology Jalandhar,
(Telephonic Communication, 13 June, 2011).
14. Moody, J., Bebensee, M. and Carter, H., 2008, Whistle-Blowers and Technology: A
Cross-Cultural Framework for Effective Corporate Malfeasance Reporting Systems,
Journal of International Business Research, 7(2) pp. 89-105.
15. Sharman, S., 2011. Director Publications DAVCMC, (Telephonic Personal communication,
10 June, 2011).
19
16. Singh, B., 2011. Receptionist DAV Public School Kurukshetra, (Telephonic
Communication, 13 June, 2011).
17. UNICEF, 2010, India Statistics, [Internet] Available at:
<http://www.unicef.org/infobycountry/india_statistics.html> [Accessed on 13 June,
2011]
20
7 Appendix 1
21