Corporate Social

Responsibility
 What is CSR ?
• Corporate Social Responsibility means
different things to different people. One end
of the spectrum is compliance with laws and
other is being philanthropic. Another way
of looking at it is who benefits – The
beneficiaries range from employees to
suppliers to customers to the amorphous
entity called ‘Community’. Complying with
the law is the basic minimum to legitimately
stay in business.
 What is CSR ?
• Corporate Social Responsibility (CSR) is viewed as a
comprehensive set of policies, practices and programs
that are integrated into business operations, supply
chains, and decision-making processes throughout
the organization -- wherever the organization does
business -- and includes responsibility for current
and past actions as well as future impacts.
• CSR involves addressing the legal, ethical,
commercial and other expectations society has for
business, and making decisions that fairly balance the
claims of all key stakeholders.
 What is CSR ?

• European Commission (2001) defines

CSR as “a concept whereby companies
decide voluntarily to contribute to a
better society and cleaner environment
and as a process by which companies
manage their relationship with
stakeholders”.
 CSR AT TISCO
• Jamsedji Tata had instructed his son Dorabji : “Be
sure to lay out wide streets planted with shady trees,
every other one of a quick growing variety. Be sure
there is plenty of space for lawns and gardens.
Reserve large areas for football, hockey and parks.
Earmark areas for Hindu temples, Mohammedan
mosques and Christian churches. “
• Eight hour shift in 1912
• Free medical aid for employees and family in 1915
(ESI Act 1948)
• A welfare department in 1917. (Provision in 1948
Factories Act)
 CSR AT TISCO
• Workers’ provident fund, leave with pay and
accident compensation in 1920 (EPF Act 1952)
• A technical training institute in 1921
• Maternity Benefit Scheme in 1928 (Maternity
Benefit Act 1961)
• Bonus in 1934 (Payment of Bonus Act 1965)
• Retirement gratuity in 1937 (Payment of Gratuity
Act 1972)
• A school for the children of TISCO workers in
1917 (Even no provisions today)
 Forces Inducing CSR
• The pressure of organized labour
• Growing public awareness about quality of life and
the need to remove all types of pollution
• Public opinion stressing on business morality and
integrity to be observed by all organization in any
field of human endeavor
• The threat of nationalization or of severe regulations
in business, to prevent public exploitation and evils
of monopoly
• The development of consumerism in many countries,
insisting on consumer protection in the market place
• The managerial revolution enabling managers to act
as trustees and to adopt an objective attitude in the
distribution of surplus among all the interested
parties
 Social Responsibilities of A Business
• Optimum utilization of scarce national resources
• Responsibility not to make losses
• Improved quality of life
• Responsibility of employment and income
• Offering quality products at fair prices
• Environmental protection
• Fair trade practices
• Local development
 What they say for ?
• Corporate’s foremost social responsibility is to create
maximum shareholder value working under the
circumstances where it is fair to all its stakeholders-
workers, consumers, the community, government and the
environment. By living in the harmony with the
community and environment around us and not cheating
our customers and workers, we might not gain anything in
the short run, but in the long term, it means greater value
and profit for the shareholders. N. R Narayana Murthy
• CSR as a concept is different to different people in
different countries. Fundamentally, CSR is balancing the
conflicting interests put on the corporations from
different stockholders with the objectives a commercial
organization in such a way that there is minimum loss to
anybody. – Aman Mehta, HSBC, Hong Kong.
 Argument for CSR
• Public expenditure
• Long run viability
• Public image
• Better environment
• Avoidance of government regulation
• Balance of responsibility and power
• Let business try
• Business has the resources
• Prevention is better than cure
• Shareholder interest
 What they say against ?
• If you find an executive who wants to take on
social responsibility, fire him fast. – Peter
Drucker.
• As an industrialist my job is to produce goods
to satisfy the demand. Let us be very clear
about it. Everyone has to do his job. My
commitment is to produce at the cheapest
price and the best quality. If you dabble in
everything then you make a mess of things. If
we can not take care of our employees and
shareholders and start worrying about the
world, then that is hypocrisy. – Dhirubhai
Ambani
 Arguments against CSR
• Loss of profit maximization
• Cost
• Lack of skills
• Dilution of purpose
• Lack of broad support
• Lack of accountability
 Strategic utility of CSR
• E-choupal
• Project shakti
How To Do Good
• The company can undertake a programme
independently
– Tata Tea’s JAGO RE
– Aircel’s Save Our Tigers
• Partnering with an NGO
• The company can outsource its business processes to
those really in need.
– Titan enlists the help of an NGO to train physically challenged people for
watch repair and watch strap making work.
 How To Do Good
• Buy supplies from the needy
– HLL buys its corrugated boxes from an NGO,
which works with the disabled.
– Tata Motors and Bajaj Auto have tied up with poor
women in their communities to supply pickles and
chapattis in their canteens.
• Voluntary work on an individual level
• Matching donations
Factors Affecting Social Orientation
• Promoters and top management
• Board of directors
• Stakeholders and internal power relationship
• Societal factors & Ethical influences
• Industry and trade associations
• Government and laws
• Political influences
• Competitors
• Resources
Feelings are important in our life as they come from
heart…
If we respond back they grow…
If We Ignore, they die…
&
If we respect, they stay forever