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CORPORATE SOCIALRESPONSIBILITY &
INSURANCE SECTOR
R.Venugopal
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WHAT IS CSR?
Is it Philanthropy and Charity?
Is it social and humanitarian work?Is it protecting the Environment?
Is it undertaking public service tasks
which normally Govt. should be doing?Or is it all of these?
The answer is both YES & NO.
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CSR
The CSR of a company should beundertaking all actions as would maximize
the probability of its long-term survivaland sustained growth.
A company has both direct stakeholders
and indirect stakeholders.It also impacts on the externalenvironment.
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STAKEHOLDERS
Direct-all employees, suppliers & vendors,dealers as well as shareholders.
Indirect-communities living near theproduction facility, customers and otherswhose livelihood could be influenced by the
operations of the company.Larger the company, greater thestakeholders.
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MUTUAL INTEREST
It in the mutual interest of both thecompany and the stakeholders thatthe company should have long-termsustained growth.
Any closure of the company wouldlead to disruption in the lives of manyand cause severe hardship to theweaker among the stakeholders.
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SOCIETAL RESPONSIBILITY
The sustained growth of the industryis a part of the societal responsibilityof the company.
Shareholder education and theawareness among both the Direct andIndirect stakeholders regarding CSRis also a prime concern of thecompany.
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I.T.SECURITY
As an insurer, it is his responsibilityto establish identity of thecustomers properly to avoid frauds inclaims,security threats and to takecare of the recent AML Guidelines.
While large amounts are paid aspremiums, thro I.T. insurer has tocomply with AML Guidelines.
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I.T.SECURITY
In view of Govt.s ambitious plan ofextending insurance cover to thepeople living below poverty line,(thereare about 30 cr people in thiscategory),again insurer has to tackle
the identity problem with the help ofI.T.The necessity for a bio-metriccard comes in.
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ENVIRONMENT
All companies have to ensure that theiractivities do not adversely affect the
environment.Depletion of natural resources forests orground water is a case in point.
Recovery of heat or minerals from thegases or effluents reduces pollution.
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ENVIRONMENT
Atmospheric pollution affects the healthof the people and so must be minimized.
Laws relating to the environment should beobserved both in letter and spirit.
Companies require regular availability of
well-educated and trained workers,engineers, management & otherprofessionals.
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ENVIRONMENT
Thus getting involved in improvingeducational and training institutions,relevant to the company, serves bothas CSR and promotes long-termbusiness interests.
The same argument applies toprograms undertaken to improve thequality of life of people living nearby.
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ENVIRONMENT
Many actions like the following help brandbuilding:
Maintaining traffic roundaboutsMaintaining parks for children & elderly
Advertising for socially important causes
Promoting road safetyTaking village development projects
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ENVIRONMENT
Promoting research in areas important forrural development
Promoting action by citizens in areas whichare better for the environment or society.
These kind of activities help in building a
positive image and encouraging socialinvolvement of the companys employeeswho in turn develop a sense of loyalty.
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FOUNDATIONS
Many Corporate float separate venturescalled Foundations to conduct CSR Projects
instead of doing themselves directly.INFOSYS Foundation,
WIPROS Foundation
BILL MELINDA GATES Foundation etc.LIC GOLDEN JUBILEE Foundation.
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LIC-GJF
This was established on 20-10-2006 and itcommenced its activities from March 07.
The Foundation has been created with aninitial corpus of Rs.50 cr.with the provisionthat Rs.10 cr. Will be infused every year
for the next five years taking the totalcorpus to Rs.100 cr.
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LIC-GJF SUPPORTED
PROJECTSInfra-structure support in the fieldof education:
Marudyan Primary & Junior HighSchool, Dhanpota, Kolkata.Learning Centre, SOS Children
Village-Latur-Aurangabad.Learning Centre, SOS Village-Shillong.
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LIC-GJF PROJECTS
Navjeevan Centre, Kalyan.
Tinisuti Bima School, Gauhati.
Govt.Upper Primary School, Bheemanad-Ernakulam.
Sai Vivekanand Vidyalay, Chennai.
Sr.Secondary School, Surani-Shimal.Sewa Bharti, Bhopal.
Anand Kendra, Gwalior.
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LIC-GJF PROJECTS
Golden Jubilee Scholarship awarded to 36visually impaired children with the National
Association for the Blind, Mumbai- in theshape of Braille Books, Special Teachersand other aids.
In the area of Health and sanitation:A mobile van Dispensary-fully equipped tothe Peoples Welfare Society-Allahabad.
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LIC-GJF PROJECTS
A mobile Dispensary van toRamakrishna Math, Kochi.
Another such van to Social WelfareProject, Totopara, Jalpaiguri.
5 Cochlear Implants sanctioned tochildren belonging to weaker sectionsat the KEM Hospital, Pune.
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LIC-GJF PROJECTS
Distributed Computers, Hearing AidMachines, Cots, Sewing Machines, Audio
graph Machines, Wheel chairs etc. atdifferent Centers.
Supported NGOs who are working in the
remotest villages of North-east, in theTribal areas of Kangra District-HimachalPradesh & far-flung villages of Kerala.
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BHARTI-AXA LIFE INS. CO
This company has launched its CSRProg.-Bharti AXA Life Hearts in
Action.This is aimed at benefiting under-privileged children across India.
Their employees are volunteering tospend their time with over 1000needy children at the four Metros.
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BHARTI-AXA-CONTD.
These employees will be visiting thehomes, cheering the children throgames and gifts and also help themacquire new skills that could be of useto them in their future lives.
The company will also offer monetarycontribution towards the education ofthese children.
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INSURERS ROLE
Insurance company has corporatesocial responsibility towardsimproving the environment, but at thesame time, the company has to garnergood premium as ultimately the
insurer has to earn profits for itsshareholders & stakeholders.
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INSURERS ROLE
The company can earn profits onlywhen there are less early deathclaims and more maturity claims.
When the insurer starts insuring thepoor slum dwellers as per thedirectives of IRDA, it becomes itsconcern to improve the conditions.
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INSURERS ROLE
In metropolis, we have the spectacleof both plenty and poverty living
together-a sky scraper adjoined by adirty slum full of unsanitaryconditions and filth.
I give the suggestion:When the people of such a localitytake insurance policiescontd.
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SUGGESTION
The insurer assesses the area andrates it as A, B, C or D depending up
on the cleanliness, whether theindustrial waste is discharged in tothe stream, whether the Govt.hospitals are well maintained and howare the other civicamenities.Depending on the rating thepremium is charged for all.
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SOCIAL AWARENESS
This will awaken the customers whowould persuade the municipalauthorities, police and industrialistsand they will take up the issues andimprove the environment.When that
happens, the premium too getsreduced in the next year.The insureralso donates a part of the premium.
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CSR
Thus the insurance companies becomethe Inspectors and the IRDA thewatchdog.
Sanitation, garbage collection anddisposal, effluent management,
pollution control and environmentImprovement are some of the areasto be concentrated.
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CLEANLINESS IS GODLINESS
How long we are going to wait lookingat the Govt?
While we feel unhappy when aforeigner wins Oscar Awardsportraying our abject poverty, what
steps we have taken to remove thoseirritants in our country?
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MR.MUKESH AMBANIS CALL
The above top Industrialist hasmentioned the following whileaddressing the International BarAssociation at the conference-TakingIndia to the next Millennium-at
Mumbai on March 6, 2009 asreported by the Economic Timesdated March 9, 2009:
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MR.MUKESH AMBANIS CALL
Eradicating poverty lies with all ofus.Its not fair to hold only the Govt.or the Industry responsible forit.Going forward, the responsibilitylies with civil society, which means all
of us.Everybody should get an equalopportunity,quality of life,health andeducation.
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GOOD CORPORATE CITIZEN
A reasonable requirement for any companythat wants to call itself a good corporate
citizen ought to be to spend at least 1% toits previous years pre-tax profit forphilanthropic purposes.
Some companies are clearing more thanthis-TARGET and GENERAL MILLS of U.S.
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NEED OF THE HOUR
We need a cadre of self-motivated andsensitive CEOs to lead the way.
We need men and women who will matchactions with words by carrying outcombined corporate contributions andcommunity-related initiatives that aresupported by adequate resources and time,rather than by more chest-beating adcampaigns and press releases.
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ICAI RULES
The Institute of CharteredAccountants of India(ICAI)- a
Statutory Body in India that setsaccounting & Auditing Standards forthe Corporate Sector, is working on anew set of Rules on CSR, making it amust for Companies to report onsocial, environmental and economicinitiatives.
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ICAI RULES
This has assumed importance in the backdropof accusations that many companies realize
growth at the cost of environment and thesociety at large.
For example, despite legal interventionslifeline rivers like the Yamuna and the HolyGanges have fallen prey to waste fromfactories.
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ICAI RULES
Many Indian Companies have lost bigorders from overseas clients afterbeing accused of employing childlabor.
Be it in the Paper Industry, soft
drink or automobile many companieshave come under scanner forexploiting environment for benefits.
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CSR-A GLOBAL VIEW
Insurance Companies are the majorcontributors in U.S.on the charitable
contributions in 2006, as per a survey.They have paid 147 million dollars out ofthe total 10.21 billion dollars.
Insurers also occupied a position among thetop 20 donors in international scene.
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CSR- A GLOBAL VIEW
The five largest insurance companycorporate Foundations are:
MetLife FoundationThe Prudential Foundation
The State Farm Companies Foundation
The Allstate FoundationNationwide Foundation.
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CSR-A GLOBAL VIEW
The Insurance companies invest inhelping to fund the building of roads,schools and other public projects.They provide businesses with capitalfor research, expansions and other
ventures thro their investments incorporate equities and bonds.
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