Description
This is a presentation highlights on corporate social responsibility, differentiates between corporate philanthropy and CSR, different approaches to CSR, different types of social initiatives, CSR in Tata.
Corporate Social Responsibility
CSR Defined
“CSR is a commitment to improve community wellbeing through discretionary business practices and contributions of corporate resources.” -Philip Kotler 2. CSR is “business’ commitment to contribute to sustainable economic development, working with employees, their families, the local community, and society at large to improve their quality of life.”
1.
- World Business Council for Sustainable Development
CSR Defined
? The organization Business for Social
Responsibility defines CSR as “operating a business in a manner that meets or exceeds the ethical, legal, commercial, and public expectations that society has of business.”
?
Focus on business decision-making related to
? ? ?
Ethical values Legal requirements Respect for people, communities and environment
? Profit, People and Planet
The corporation’s evolving personality
? The orthodox view is that corporate amorality.
In other words, corporations lack “either pants to kick” or “a soul to damn” ? That is, corporations do not have a conscience. Only individuals can be moral or immoral and therefore they cannot be punished. ? So, corporation was treated as a fictional umbrella for a private association of shareholders who have the right to incorporate and have limited liability
Cont…
? By the dawn of 20th century, with the spectacular
growth of corporations in industrialized world, corporations were treated as “natural” or “real” entity. ? For legal purpose, the corporation has been declared a citizen, contrary to the orthodox view. ? The doctrine of limited shareholder liability protected shareholders from undesirable consequences of corporate behaviour. ? So, by 1930, corporations were recognized as society’s essential institutions which means that they cease to be treated as private business device for earning profits for only shareholders.
Cont…
? Thus, the view became increasingly popular that
corporations have responsibilities not just to shareholders but to other stakeholders as well. ? This position implies a moral personality for the corporation.
? ?
What is the most likely future? Do we foresee a world in which companies are expected to behave as moral actors?
? It appears that companies will be expected to show a
moral face to the world while at the same time fulfilling their functions as wealth creators, producers and employers.
The Value shift in business
? More and more companies are rejecting the
traditional ideas of management as a “valuefree science” and business as an “ethics-free zone.” ? The motives could be many:
?
? ? ?
Transforming the company into a world-class organization; Protect company’s reputation for integrity To become a role model for the society To stay clear of scandals
Cont…
? So, ethics is increasingly viewed as an important
corporate concern
? ? ?
?
What is our purpose? What do we believe in? What principles should guide our behaviour? What do we owe to the people we deal with – our employees, our customers, our investors, our communities?
? Such question of ethics are being taken seriously in
many companies around the world.
CP vs. CSR: Two different approaches to social responsibility of business
? Corporate Philanthropy
? ? ? ?
? CSR
? ? ? ?
?
? ? ?
Giving Cause-based Promotion Leader-driven Business & Society Image, reputation, and also profits Scale and reach is limited Matter of discretion
?
?
? ?
Acting Consequence-based Prevention, protection, and conservation CSR as a priority Business + Society Source of opportunity, innovation, and competitive advantage Scale is large Part of boardroom discussion
What are the trends?
? Increased corporate giving (philanthropy
continues to be the major approach) ? Increased reporting (voluntary compliance to international standards) ? Establishment of a corporate social norm to do good (code of conduct) ? A shift from obligation to strategy
Why do good?
? Increased sales and market share
? Strengthened brand positioning
? Enhanced corporate image and clout ? Increased ability to attract, motivate and
retain employees ? Increased appeal to investors and financial analysts.
Approach to CSR
? Business + Society = CSR
? Corporate success and social welfare are not a zero-
sum game. ? When looked at positively, CSR can become a source of tremendous social progress, as the business can benefit society in diverse ways. ? In the beginning, CSR had to be pushed through pressure from stakeholders ? Currently, there is a debate to institutionalize it in corporate culture and practice.
Drivers of CSR
? Growth and reach of the private sector as a result of
? ? ? ? ? ?
globalization, market liberalization, privatization and technological innovation (about 70,000 MNC with their affiliates to well over 8,00,000 with millions of SMEs) Crisis of trust in private sector primarily due to corporate scandals. So, corporate leaders have to respond to that and rebuild trust Growth in the number of NGO, civil society groups, campaigning groups. They can profile corporate malpractices and raise these to public attention. Growing financial clout of large institutional investors which is used to drive agenda like triple bottom line Gaps in public governance/corruption Importance of intangible asset like reputation, brand „Problems without passport? (Climate Change/AIDS)
Four Justifications for CSR
? Moral obligations (businesses have conscience, corporate
citizenship)
? Sustainability (Meeting the needs of the present without
compromising the ability of future generations to meet their own needs)
? License to operate (regulation / permission) ? Reputation (public image and customer faith)
Integrating Business & Society
? Successful corporations need a healthy society. ? A healthy society needs successful companies. ? This means that both business decisions and social
policies must follow the principle of SHARED VALUES
? A company must integrate a social perspective into
its competitive context and core business strategy
How to achieve this integration?
? Identifying the points of intersection
?
Inside-out linkages (Company? impact)
? ?
Immediate impacts on society Assessment of future impacts on society Social conditions are key part of competitive context
?
Outside-in linkages (Society? impact)
?
Cont…
? Choosing which social issues to address ? Each company must select issues that interact with its particular business ? CSR should be guided not by the cause but by the opportunity to create social value (i.e. a meaningful benefit for society that is also valuable to the business) ? Generic social issues ? Value chain social impacts ? Social Dimensions of competitive context
Cont…
? Creating Corporate Social Agenda is the
goal
?
The aim is to achieve social and economic benefits simultaneously Reinforcing corporate strategy by advancing social conditions
?
Cont…
? Responsive CSR
? ?
Good corporate citizenship behaviour Mitigating the harm arising from a firm?s value chain activities (is an operational challenge)
? Strategic CSR
? ?
Transform value chain activities to benefit society while reinforcing strategy Strategic philanthropy that leverages capabilities to improve salient areas of competitive context
Cont…
? Integrating inside-out and outside-in
practices
? ?
The social and business gain of CSR would be greater if integration is mutual. When value chain practices and investments in competitive context are fully integrated, CSR becomes part of the day-to-day business of the company.
?
?
Nestle E-Chaupal
Cont…
? Creating a social dimension to the value
proposition
?
?
The most strategic CSR occurs when a company adds a social dimension to it value proposition, making social impact integral to the overall strategy. It is not a very easy task to do for a company, but adding a social dimension to the value proposition offers a new frontier to competitive positioning.
Organizing for CSR
? Organization development (OD)
interventions are required
? ?
Organizational structure (Reporting relationships, Roles and responsibilities) Incentives and HR practices
? Very few companies have engaged
operating management in processes that identify and prioritize social issues as important to business operations and competitive context.
Cont…
? Companies must shift from a fragmented,
defensive posture to an integrated, affirmative approach. ? The focus must move away from an emphasis on image to an emphasis on substance. ? In other words, shift to acting in responsive as well as in a strategic fashion
Cont…
? Mapping social opportunities and
measuring social impact along with review of business model ? Value chain and competitive-context investments in CSR need to be incorporated into the performance measures of managers
What is required?
? Broadening job definition
? Removing long-standing prejudices
? Removing us-verses-them mind-set ? Over-all attitude change ? Choosing which social issue to focus ? Creating shared value should be seen as a
long-term investment in company?s future competitiveness
Path to Corporate Social Responsibility
? The process is not a one-time affair
? Different stages of organizational learning
? Different stages of the maturity of societal issue ? Integrating social agenda into corporate strategy is an
outcome of a new understanding of business-society relationship (Choosing a Social Issue) ? Evolving innovative business models and practices leading to societal as well as company benefits is one of the major challenges of managing change and innovation (Selecting an Initiative)
Five Stages of Organizational Learning
Defensive Deny practices, outcomes, or responsibilities To defend against attacks that affect sales, recruitment, productivity, and the brand
Compliance
Adopt a policy-based compliance approach Integrate the societal issue in core management process Integrate the societal issue into their core business strategies Promote broad industry participation in corporate responsibility
To mitigate reputation and litigation risks To achieve long-term gain in daily operations To align strategy and process innovations with the societal issue for enhancing economic value To realize gains through collective action
Managerial
Strategic
Civil
Four Stages of Issue Maturity
Latent Emerging
?Awareness
of societal issue ?There is weak scientific or hard evidence ?The issue is largely ignored
?Political
and media awareness of issue ?Emerging arguments and data in support ?Leading businesses experiment with approaches to dealing with the issue
?Emerging
Consolidating
business practices around the issue ?Issue-based initiatives are taken ?There is legislation ?Voluntary standards are developed
?Legislation
Institutionalize d
or business norms ?The integrated practices become part of businessexcellence model
Choosing a social issue
? How does this support our business goal? ? How big of a social problem is this? ? Isn?t the government or someone else
handling this? ? What will our stockholders think of our involvement in this issue? ? Is this something our employees can get excited about? ? Will this cause backfire on us?
Corporate Social Initiatives
? Corporate social initiatives are major
activities undertaken by a corporation to support social causes and to fulfill commitments to corporate social responsibility.
Types of Initiatives
? Cause Promotions
? Cause-Related Marketing
? Corporate Social Marketing ? Corporate Philanthropy ? Community Volunteering ? Socially Responsible Business Practices
?
? ?
Partnerships with public, private and civil society groups (Cause-based Alliances) Corporate Foundations Developing New Business Models
Partnerships and/or Convergence
? Companies, government, and NGOs adopt different
attitudes towards social responsibility (Preconvergence Stage) ? Companies, Government and NGOs realize that they have to co-exit (Stage One) ? Companies and their partners try to learn from and work with each other (Stage Two) ? Companies and partners enter into co-creation business relationships (Stage Three)
Corporate Foundations
? Act as the bridge between companies and
partners in socially responsible initiatives ? Gives a forum to company employees for contributing to the cause ? Mainstreaming the corporate initiatives in terms of both responsive and strategic aspects of CSR.
Developing New Business Models
? Co-create markets, along with emerging customers ? ? ? ? ?
and bottom-of-the pyramid entrepreneurs, through innovative business models (e-Chaupal) Task-oriented relationships, rather than ideology or policy-driven dialogues (Medical care) Customer-centric models (Retailing innovation) Relationship is not that of opponents Bold value propositions with credible economic, social and environmental dimensions Advocacy of common policies and regulatory schemes (Job quotas for disabled)
CSR in India
? CSR- A Tradition with Indian Business
?
?
“ Give back to the society what you earn from it” Business Leaders work as guardians and the masters of people they employ
? Nature of Social Commitments
?
? ?
?
Philanthropy Support of Art and Culture Disaster Relief Social, Economic and Community Development
? CSR- GOI Perspective
?
? ?
?
? ?
Enforcement of Specific Laws Employees issues, Environmental concerns, Corporate Governance and Disclosures. No CSR Enforcement through Legislation No separate expectations from MNCs
? CSR-Emerging Scenario ? 80% of the senior executives have expressed commitment to CSR ? Growing concern for larger social issues ? Stakeholder Engagement ? National Foundation for Corporate Governance (NFCG) ? CII-CSR Initiative
CSR: The TATA Way
? The importance of values of their leaders ? Linkage between values and business
practice
?
“In a free enterprise, the community is not just another stakeholder in business, but is in fact the very purpose of its existence.”
? Jamsetji N. Tata (Founder, Tata Group, 1868)
Cont…
“The Tata philosophy of management has always been and is today more than ever, that corporate enterprises must be managed not merely in the interests of their owners, but equally in those of their employees, of the customers of their products, of the local community, and finally of the country as a whole.” -J. R. D. Tata
Initiatives
? TATA Council for Community Initiatives
(TCCI) ? Tata Index for Sustainable Human Development for directing, measuring and enhancing the community work that assist all group companies in their social responsibility efforts.
Figure: The TATA Index
Recent Trends
? UN Global Compact
? Social Code for Business
? CSR Reporting ? Global Reporting Initiative (GRI)
What is the Global Compact?
? The United Nations Global Compact is a
strategic policy initiative for businesses that are committed to aligning their operations and strategies with ten universally accepted principles in the areas of human rights, labour, environment and anti-corruption.
SOCIAL CODE FOR BUSINESS
? In recent years, the concept of Corporate Social
Responsibility had emerged as an increasingly important feature of the business philosophy. ? No longer is business seen as basing its decisions solely on economic criteria. Businesses are now expected to consider the ethical, moral and social impact of their actions and decisions. ? A corporate that is sensitive to the surroundings and to the needs and aspirations of the community in which it operates not only creates goodwill and a strong market for its business, but also helps support a sustainable neighbourhood. ? We list here a set of principles and standards for good corporate citizenship for voluntary adoption.
Social Code
? The Company affirms the interdependence of its enterprises with
the well being and self–reliance of the community. This can be done by adopting an Article of Association on Corporate Social Responsibility (CSR) that advocates harmonising economic progress with social and environmental considerations
? The Company has a specific written policy statement on CSR
(social & environmental) which is in public domain
? The Company has an explicit strategy on social and
environmental issues that can be seen in the form of an Annual Work Plan mainstreamed with its business process
? The Company has included CSR as part of its corporate
communications including newsletters and there is reporting on CSR in the Company's Annual Report
Social Code
? The Company had a senior executive under the CEO
responsible for CSR and managerial level officers tasked specifically with social and environment work. The CEO reviews the CSR programmes twice in a year ? The Company ensures equal access to employment and promotion opportunities across gender and cultures through policies and programmes. ? The Company had allocated specific resources for CSR activities and has monitoring system to track implementation process and impact ? The Company demonstrates its CSR by providing an enabling environment for employees to volunteer that includes recognition and accounting for volunteer time
Social Code
? The Company is committed to document its learning
experiences in terms of human achievements, contribution to the community, the learning for all stakeholders for sharing with local governments and development agencies ? The Company is also known for the partnerships it builds with various development players in the fields to synergise all available opportunities to bring about holistic development of the local community ? The Companies to expand the scope of learning from each other in their role of being good corporate citizens by way of exchanging data, views, implementation procedures and even exchange of expert personnel whenever necessary
CSR Reporting
? We can also understand CSR practices and
performance from companies? CSR reporting.
? The comparisons are possible in terms of ? Reporting standards; ? Issues discussed; and ? How CSR issues are framed. ? Trends ? Reporting rates are highest in Europe followed by Japan and US showing lowest rates of reporting
Cont…
?
The environmental and social concerns are still quite low in general; External verification of reports not very common; 45% European reports externally verified; 24 % Japanese and 3% of American reports are externally verified. Lack of disclosers and external verification is mainly due to the fear of litigation, showing huge external stakeholder pressure on companies to follow CSR initiatives.
?
?
Global Reporting Initiative (GRI)
? No universal standard for CSR Reporting ? GRI guidelines have emerged as the singly global
framework for CSR reporting ? GRI reports should be relevant for financial markets analysts seeking access to sustainability performance. ? Guidelines are for voluntary use by organizations for reporting on the economic, environmental, and social dimensions of their activities, products and services.
Cont…
? GRI is based on inputs of business
representatives, accountancy, investment, environment, human rights, research and labour organizations from around the world.
Thanks
S K Tapasvi
doc_856736845.pptx
This is a presentation highlights on corporate social responsibility, differentiates between corporate philanthropy and CSR, different approaches to CSR, different types of social initiatives, CSR in Tata.
Corporate Social Responsibility
CSR Defined
“CSR is a commitment to improve community wellbeing through discretionary business practices and contributions of corporate resources.” -Philip Kotler 2. CSR is “business’ commitment to contribute to sustainable economic development, working with employees, their families, the local community, and society at large to improve their quality of life.”
1.
- World Business Council for Sustainable Development
CSR Defined
? The organization Business for Social
Responsibility defines CSR as “operating a business in a manner that meets or exceeds the ethical, legal, commercial, and public expectations that society has of business.”
?
Focus on business decision-making related to
? ? ?
Ethical values Legal requirements Respect for people, communities and environment
? Profit, People and Planet
The corporation’s evolving personality
? The orthodox view is that corporate amorality.
In other words, corporations lack “either pants to kick” or “a soul to damn” ? That is, corporations do not have a conscience. Only individuals can be moral or immoral and therefore they cannot be punished. ? So, corporation was treated as a fictional umbrella for a private association of shareholders who have the right to incorporate and have limited liability
Cont…
? By the dawn of 20th century, with the spectacular
growth of corporations in industrialized world, corporations were treated as “natural” or “real” entity. ? For legal purpose, the corporation has been declared a citizen, contrary to the orthodox view. ? The doctrine of limited shareholder liability protected shareholders from undesirable consequences of corporate behaviour. ? So, by 1930, corporations were recognized as society’s essential institutions which means that they cease to be treated as private business device for earning profits for only shareholders.
Cont…
? Thus, the view became increasingly popular that
corporations have responsibilities not just to shareholders but to other stakeholders as well. ? This position implies a moral personality for the corporation.
? ?
What is the most likely future? Do we foresee a world in which companies are expected to behave as moral actors?
? It appears that companies will be expected to show a
moral face to the world while at the same time fulfilling their functions as wealth creators, producers and employers.
The Value shift in business
? More and more companies are rejecting the
traditional ideas of management as a “valuefree science” and business as an “ethics-free zone.” ? The motives could be many:
?
? ? ?
Transforming the company into a world-class organization; Protect company’s reputation for integrity To become a role model for the society To stay clear of scandals
Cont…
? So, ethics is increasingly viewed as an important
corporate concern
? ? ?
?
What is our purpose? What do we believe in? What principles should guide our behaviour? What do we owe to the people we deal with – our employees, our customers, our investors, our communities?
? Such question of ethics are being taken seriously in
many companies around the world.
CP vs. CSR: Two different approaches to social responsibility of business
? Corporate Philanthropy
? ? ? ?
? CSR
? ? ? ?
?
? ? ?
Giving Cause-based Promotion Leader-driven Business & Society Image, reputation, and also profits Scale and reach is limited Matter of discretion
?
?
? ?
Acting Consequence-based Prevention, protection, and conservation CSR as a priority Business + Society Source of opportunity, innovation, and competitive advantage Scale is large Part of boardroom discussion
What are the trends?
? Increased corporate giving (philanthropy
continues to be the major approach) ? Increased reporting (voluntary compliance to international standards) ? Establishment of a corporate social norm to do good (code of conduct) ? A shift from obligation to strategy
Why do good?
? Increased sales and market share
? Strengthened brand positioning
? Enhanced corporate image and clout ? Increased ability to attract, motivate and
retain employees ? Increased appeal to investors and financial analysts.
Approach to CSR
? Business + Society = CSR
? Corporate success and social welfare are not a zero-
sum game. ? When looked at positively, CSR can become a source of tremendous social progress, as the business can benefit society in diverse ways. ? In the beginning, CSR had to be pushed through pressure from stakeholders ? Currently, there is a debate to institutionalize it in corporate culture and practice.
Drivers of CSR
? Growth and reach of the private sector as a result of
? ? ? ? ? ?
globalization, market liberalization, privatization and technological innovation (about 70,000 MNC with their affiliates to well over 8,00,000 with millions of SMEs) Crisis of trust in private sector primarily due to corporate scandals. So, corporate leaders have to respond to that and rebuild trust Growth in the number of NGO, civil society groups, campaigning groups. They can profile corporate malpractices and raise these to public attention. Growing financial clout of large institutional investors which is used to drive agenda like triple bottom line Gaps in public governance/corruption Importance of intangible asset like reputation, brand „Problems without passport? (Climate Change/AIDS)
Four Justifications for CSR
? Moral obligations (businesses have conscience, corporate
citizenship)
? Sustainability (Meeting the needs of the present without
compromising the ability of future generations to meet their own needs)
? License to operate (regulation / permission) ? Reputation (public image and customer faith)
Integrating Business & Society
? Successful corporations need a healthy society. ? A healthy society needs successful companies. ? This means that both business decisions and social
policies must follow the principle of SHARED VALUES
? A company must integrate a social perspective into
its competitive context and core business strategy
How to achieve this integration?
? Identifying the points of intersection
?
Inside-out linkages (Company? impact)
? ?
Immediate impacts on society Assessment of future impacts on society Social conditions are key part of competitive context
?
Outside-in linkages (Society? impact)
?
Cont…
? Choosing which social issues to address ? Each company must select issues that interact with its particular business ? CSR should be guided not by the cause but by the opportunity to create social value (i.e. a meaningful benefit for society that is also valuable to the business) ? Generic social issues ? Value chain social impacts ? Social Dimensions of competitive context
Cont…
? Creating Corporate Social Agenda is the
goal
?
The aim is to achieve social and economic benefits simultaneously Reinforcing corporate strategy by advancing social conditions
?
Cont…
? Responsive CSR
? ?
Good corporate citizenship behaviour Mitigating the harm arising from a firm?s value chain activities (is an operational challenge)
? Strategic CSR
? ?
Transform value chain activities to benefit society while reinforcing strategy Strategic philanthropy that leverages capabilities to improve salient areas of competitive context
Cont…
? Integrating inside-out and outside-in
practices
? ?
The social and business gain of CSR would be greater if integration is mutual. When value chain practices and investments in competitive context are fully integrated, CSR becomes part of the day-to-day business of the company.
?
?
Nestle E-Chaupal
Cont…
? Creating a social dimension to the value
proposition
?
?
The most strategic CSR occurs when a company adds a social dimension to it value proposition, making social impact integral to the overall strategy. It is not a very easy task to do for a company, but adding a social dimension to the value proposition offers a new frontier to competitive positioning.
Organizing for CSR
? Organization development (OD)
interventions are required
? ?
Organizational structure (Reporting relationships, Roles and responsibilities) Incentives and HR practices
? Very few companies have engaged
operating management in processes that identify and prioritize social issues as important to business operations and competitive context.
Cont…
? Companies must shift from a fragmented,
defensive posture to an integrated, affirmative approach. ? The focus must move away from an emphasis on image to an emphasis on substance. ? In other words, shift to acting in responsive as well as in a strategic fashion
Cont…
? Mapping social opportunities and
measuring social impact along with review of business model ? Value chain and competitive-context investments in CSR need to be incorporated into the performance measures of managers
What is required?
? Broadening job definition
? Removing long-standing prejudices
? Removing us-verses-them mind-set ? Over-all attitude change ? Choosing which social issue to focus ? Creating shared value should be seen as a
long-term investment in company?s future competitiveness
Path to Corporate Social Responsibility
? The process is not a one-time affair
? Different stages of organizational learning
? Different stages of the maturity of societal issue ? Integrating social agenda into corporate strategy is an
outcome of a new understanding of business-society relationship (Choosing a Social Issue) ? Evolving innovative business models and practices leading to societal as well as company benefits is one of the major challenges of managing change and innovation (Selecting an Initiative)
Five Stages of Organizational Learning
Defensive Deny practices, outcomes, or responsibilities To defend against attacks that affect sales, recruitment, productivity, and the brand
Compliance
Adopt a policy-based compliance approach Integrate the societal issue in core management process Integrate the societal issue into their core business strategies Promote broad industry participation in corporate responsibility
To mitigate reputation and litigation risks To achieve long-term gain in daily operations To align strategy and process innovations with the societal issue for enhancing economic value To realize gains through collective action
Managerial
Strategic
Civil
Four Stages of Issue Maturity
Latent Emerging
?Awareness
of societal issue ?There is weak scientific or hard evidence ?The issue is largely ignored
?Political
and media awareness of issue ?Emerging arguments and data in support ?Leading businesses experiment with approaches to dealing with the issue
?Emerging
Consolidating
business practices around the issue ?Issue-based initiatives are taken ?There is legislation ?Voluntary standards are developed
?Legislation
Institutionalize d
or business norms ?The integrated practices become part of businessexcellence model
Choosing a social issue
? How does this support our business goal? ? How big of a social problem is this? ? Isn?t the government or someone else
handling this? ? What will our stockholders think of our involvement in this issue? ? Is this something our employees can get excited about? ? Will this cause backfire on us?
Corporate Social Initiatives
? Corporate social initiatives are major
activities undertaken by a corporation to support social causes and to fulfill commitments to corporate social responsibility.
Types of Initiatives
? Cause Promotions
? Cause-Related Marketing
? Corporate Social Marketing ? Corporate Philanthropy ? Community Volunteering ? Socially Responsible Business Practices
?
? ?
Partnerships with public, private and civil society groups (Cause-based Alliances) Corporate Foundations Developing New Business Models
Partnerships and/or Convergence
? Companies, government, and NGOs adopt different
attitudes towards social responsibility (Preconvergence Stage) ? Companies, Government and NGOs realize that they have to co-exit (Stage One) ? Companies and their partners try to learn from and work with each other (Stage Two) ? Companies and partners enter into co-creation business relationships (Stage Three)
Corporate Foundations
? Act as the bridge between companies and
partners in socially responsible initiatives ? Gives a forum to company employees for contributing to the cause ? Mainstreaming the corporate initiatives in terms of both responsive and strategic aspects of CSR.
Developing New Business Models
? Co-create markets, along with emerging customers ? ? ? ? ?
and bottom-of-the pyramid entrepreneurs, through innovative business models (e-Chaupal) Task-oriented relationships, rather than ideology or policy-driven dialogues (Medical care) Customer-centric models (Retailing innovation) Relationship is not that of opponents Bold value propositions with credible economic, social and environmental dimensions Advocacy of common policies and regulatory schemes (Job quotas for disabled)
CSR in India
? CSR- A Tradition with Indian Business
?
?
“ Give back to the society what you earn from it” Business Leaders work as guardians and the masters of people they employ
? Nature of Social Commitments
?
? ?
?
Philanthropy Support of Art and Culture Disaster Relief Social, Economic and Community Development
? CSR- GOI Perspective
?
? ?
?
? ?
Enforcement of Specific Laws Employees issues, Environmental concerns, Corporate Governance and Disclosures. No CSR Enforcement through Legislation No separate expectations from MNCs
? CSR-Emerging Scenario ? 80% of the senior executives have expressed commitment to CSR ? Growing concern for larger social issues ? Stakeholder Engagement ? National Foundation for Corporate Governance (NFCG) ? CII-CSR Initiative
CSR: The TATA Way
? The importance of values of their leaders ? Linkage between values and business
practice
?
“In a free enterprise, the community is not just another stakeholder in business, but is in fact the very purpose of its existence.”
? Jamsetji N. Tata (Founder, Tata Group, 1868)
Cont…
“The Tata philosophy of management has always been and is today more than ever, that corporate enterprises must be managed not merely in the interests of their owners, but equally in those of their employees, of the customers of their products, of the local community, and finally of the country as a whole.” -J. R. D. Tata
Initiatives
? TATA Council for Community Initiatives
(TCCI) ? Tata Index for Sustainable Human Development for directing, measuring and enhancing the community work that assist all group companies in their social responsibility efforts.
Figure: The TATA Index
Recent Trends
? UN Global Compact
? Social Code for Business
? CSR Reporting ? Global Reporting Initiative (GRI)
What is the Global Compact?
? The United Nations Global Compact is a
strategic policy initiative for businesses that are committed to aligning their operations and strategies with ten universally accepted principles in the areas of human rights, labour, environment and anti-corruption.
SOCIAL CODE FOR BUSINESS
? In recent years, the concept of Corporate Social
Responsibility had emerged as an increasingly important feature of the business philosophy. ? No longer is business seen as basing its decisions solely on economic criteria. Businesses are now expected to consider the ethical, moral and social impact of their actions and decisions. ? A corporate that is sensitive to the surroundings and to the needs and aspirations of the community in which it operates not only creates goodwill and a strong market for its business, but also helps support a sustainable neighbourhood. ? We list here a set of principles and standards for good corporate citizenship for voluntary adoption.
Social Code
? The Company affirms the interdependence of its enterprises with
the well being and self–reliance of the community. This can be done by adopting an Article of Association on Corporate Social Responsibility (CSR) that advocates harmonising economic progress with social and environmental considerations
? The Company has a specific written policy statement on CSR
(social & environmental) which is in public domain
? The Company has an explicit strategy on social and
environmental issues that can be seen in the form of an Annual Work Plan mainstreamed with its business process
? The Company has included CSR as part of its corporate
communications including newsletters and there is reporting on CSR in the Company's Annual Report
Social Code
? The Company had a senior executive under the CEO
responsible for CSR and managerial level officers tasked specifically with social and environment work. The CEO reviews the CSR programmes twice in a year ? The Company ensures equal access to employment and promotion opportunities across gender and cultures through policies and programmes. ? The Company had allocated specific resources for CSR activities and has monitoring system to track implementation process and impact ? The Company demonstrates its CSR by providing an enabling environment for employees to volunteer that includes recognition and accounting for volunteer time
Social Code
? The Company is committed to document its learning
experiences in terms of human achievements, contribution to the community, the learning for all stakeholders for sharing with local governments and development agencies ? The Company is also known for the partnerships it builds with various development players in the fields to synergise all available opportunities to bring about holistic development of the local community ? The Companies to expand the scope of learning from each other in their role of being good corporate citizens by way of exchanging data, views, implementation procedures and even exchange of expert personnel whenever necessary
CSR Reporting
? We can also understand CSR practices and
performance from companies? CSR reporting.
? The comparisons are possible in terms of ? Reporting standards; ? Issues discussed; and ? How CSR issues are framed. ? Trends ? Reporting rates are highest in Europe followed by Japan and US showing lowest rates of reporting
Cont…
?
The environmental and social concerns are still quite low in general; External verification of reports not very common; 45% European reports externally verified; 24 % Japanese and 3% of American reports are externally verified. Lack of disclosers and external verification is mainly due to the fear of litigation, showing huge external stakeholder pressure on companies to follow CSR initiatives.
?
?
Global Reporting Initiative (GRI)
? No universal standard for CSR Reporting ? GRI guidelines have emerged as the singly global
framework for CSR reporting ? GRI reports should be relevant for financial markets analysts seeking access to sustainability performance. ? Guidelines are for voluntary use by organizations for reporting on the economic, environmental, and social dimensions of their activities, products and services.
Cont…
? GRI is based on inputs of business
representatives, accountancy, investment, environment, human rights, research and labour organizations from around the world.
Thanks
S K Tapasvi
doc_856736845.pptx