CORPORATE SOCIAL RESPONSIBILITY OF MAJOR COMPANIES IN INDIA

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1 Pinnacle Research Journals 1 CORPORATE SOCIAL RESPONSIBILITY OF MAJOR COMPANIES IN INDIA ABSTRACT DR. T. SOBHA RANI* *Principal, APGCMS, Andhra Pradesh, India. From last half decade many major companies focused a remarkable importance on attention among practitioners to understand the ability of corporate social responsibility (CSR) to address environmental and social problems. Driven by the CSR movement, multinational firms have sought to position themselves as good corporate citizens. Instead of protecting firm and brand reputation, many industry leaders have already made their commitment for social upliftment of society. Corporate organizations enjoying the fruits of corporate social responsibility by strengthening their brand position increased sales market share and so on. The present study has made an attempt to understand the status and progress and initiatives made by large firms of India in context to CSR policy framing and implementation. KEYWORDS: Social problems, Policy framing, Industry leaders, CSR movement. 1. INTRODUCTION When consumers started to become aware of workers rights violations in factories around the world, apparel and footwear brands became the target. The Fair Labor Association (FLA) was formed, in part, in response to that sentiment, and for more than a decade its affiliates civil society organizations, universities and socially responsible companies have joined forces to protect workers and resolve labor issues in supply chains. Leaders in other industries, such as agriculture, have already made the commitment. Each business entity should formulate a CSR policy to guide its strategic planning and provide a roadmap for its CSR initiatives, which should be an integral part of overall business policy and aligned with its business goals. The policy should be framed with the participation of various level executives and should be approved by the Board. In India, many firms have taken the initiatives of CSR practices which have met with varying needs of the society. The present study on IT, FMCG and Auto industry for the survey. As these as taken three major sector three are the leading sectors of India and are into the planning of CSR initiatives. After globalization of world economies most of the companies/ business firms in India either already have a CSR practices initiatives or are in process of taking the initiatives. The structures, institutions, mechanisms and discourses that support and diffuse socially responsible norms of corporate behavior are part of the CSR movement. These have raised

2 Pinnacle Research Journals 2 awareness of CSR more generally, and serve as a counterpoint to the dominant shareholder value ideology in market economies. The growth experienced in socially responsible investment (SRI); the desire of firms to retain their social license to operate; pressure on corporate governance to consider stakeholder interests and recognition by financiers and funds managers of potential reputation-based and operational risks stemming from the failure to address CSR are just some of the commercial forces driving the movement. Additionally, the growing willingness. As a result, a wide range of tactics including boycott campaigns, social and eco-labeling, and environmental certification, have been used to appeal directly to firms to improve their environmental management procedures and performance as well as their treatment of workers and impacts of their activities in the communities in which they operate. These efforts to promote what is generally known as corporate social responsibility have increasingly attracted the interest of a wide range of scholars in different fields. Companies with the systems in place to proactively identify and remediate labor issues are able to protect workers throughout their supply chains and avoid costly missteps. In the process, they demonstrate to customers that they are committed to improvement and are willing and able to address problems when they arise. A lack of understanding, inadequately trained personnel, non availability of authentic data and specific information on the kinds of CSR activities, coverage, policy etc. further adds to the reach and effectiveness of CSR programmes. But the situation is changing. And CSR is coming out of the purview of 'doing social good' and is fast becoming a 'business necessity'. The 'business case' for CSR is gaining ground and corporate houses are realizing that 'what is good for workers - their community, health, and environment is also good for the business'. RESEARCH ANALYSIS CSR is not philanthropy and CSR activities are purely voluntary- what companies will like to do beyond any statutory requirement or obligation. To provide companies with guidance in dealing with the abovementioned expectations, while working closely within the framework of national aspirations and policies, following Voluntary Guidelines for Corporate Social Responsibility have been developed. While the guidelines have been prepared for the Indian context, enterprises that have a trans-national presence would benefit from using these guidelines for their overseas operations as well. Since the guidelines are voluntary and not prepared in the nature of a prescriptive road-map, they are not intended for regulatory or contractual use. While it is expected that more and more companies would make sincere efforts to consider compliance with these Guidelines, there may be genuine reasons for some companies in not being able to adopt them completely. In such a case, it is expected that such companies may inform their stakeholders about the guidelines which the companies have not been able to follow either fully or partially. A. FUNDAMENTAL PRINCIPLE Each business entity should formulate a CSR policy to guide its strategic planning and provide a roadmap for its CSR initiatives, which should be an integral part of overall business policy and aligned with its business goals. The policy should be framed with the participation of various level executives and should be approved by the Board.

3 Pinnacle Research Journals 3 B. POLICY IMPLEMENTATION 1. The CSR policy of the business entity should provide for an implementation strategy which should include identification of projects/activities, 2. Companies should allocate specific amount in their budgets for CSR activities. This amount may be related to profits after tax, cost of planned CSR activities or any other suitable parameter. 3. To share experiences and network with other organizations the company should engage with well established and recognized platforms which encourage responsible business practices and CSR activities. This would help companies to improve on their CSR strategies and effectively project the image of being socially responsible. 4. The companies should disseminate information on CSR policy, activities and progress in a structured manner to all their stakeholders and the public at large through their website, annual reports, and other Communication media. A proverbial light bulb has gone off in the minds of consumers and corporate executives alike: no brand is immune to supply chain issues.

4 Pinnacle Research Journals 4 3. CORPORATE SOCIAL RESPONSIBILITY PRACTICES IN INDIA A. INDIVIDUAL FIRM Individual firm endeavors focuses on strategies of individual firms to undertake environmentally and socially responsible behavior. Scores of practitioner conferences have been devoted to understanding the business case for CSR and the positive economic impacts that can accrue. Providing environmental or sustainability reports supporting eco-labeling, promoting health and safety for employees fair working conditions in the factories B. FIRM-NGO PARTNERSHIPS In this category, firms initiate, or are involved in, partnerships with other stakeholders. Partnerships come generally in two forms: ones in which they partner with environmental or social groups to address environmental or social issues associated with their operations which is the focus of this discussion; or public-private partnership in which firms, governments and NGOs all interact toward some common goal. Such partnerships can be important for both unlocking indirect learning processes and promoting direct specific requirements. There is little question that when NGOs and firms discuss issues, they almost always uncover misunderstandings about how things work that led NGOs to champion a course of action that might not have had the effects they were seeking. Such partnership can also create outside benefits, albeit abstract, because the public is more likely to accept a project with NGO participation than one in which firms act alone C. PUBLIC-PRIVATE PARTNERSHIPS In contrast to private-private collaborations between firms and a counterpart NGO, public private partnerships involve firms as part of a broader community of interests in which government, business, and environmental and social stakeholders interact around solving a given problem. Partnerships come in many forms. They can involve coordination to address rule or standard setting, implementation, or service provision. The Public-Private partnerships can be classified co-optation delegation co-regulation or self-regulation.

5 Pinnacle Research Journals 5 CO-OPTATION: Involves state-consultation with private actors. DELEGATION: occurs where private actors have responsibilities over governance functions by states and intergovernmental organizations. CO-REGULATION: It involves true joint decision-making between the state and private actors. SELF-REGULATION: where private actors self-regulate to avoid or reduce threats of state intervention. Public-private partnerships also exist at the local, national and international levels.they can include efforts to provide clean water to impoverished communities organized by a municipality and local companies or provide AIDS stricken communities with access to drugs, as in the case of the HIV/AIDS through the Global Health Initiative, provides an arena and some resources for engaging drug companies in an effort to bring impoverished communities health care treatments. D. INDUSTRY ASSOCIATION Industry associations made attempts to establish industry-wide codes of conduct to which its members commit to adhere fall under this category which include the chemical industry, Cement industry, fisheries Unlike the firm-level activities described above, industry-wide initiatives build collective efforts to improve CSR practices across firms. Hence, they contend with inter-firm as well as intra-firm politics. Many studies examine these politics to understand the origins of codes across sectors, and generally find them emerging in industries where companies hold collective reputations and sell primary or intermediary goods, not end-consumer goods.

6 Pinnacle Research Journals 6 "Corporate Social Responsibility Practices in India sets a realistic agenda of grassroots development through alliances and partnerships with sustainable development approaches. At the heart of solution lies intrinsic coming together of all stakeholders in shaping up a distinct route for an equitable and just social order..." Times Foundation, the corporate social responsibility wing of the Bennett, Coleman & CO. Ltd., in partnership withtns India and IRRAD undertook a national survey to understand the underlying dynamics of CSR and the current situation in India. CSR is not new to India, companies like TATA and BIRLA have been imbibing the case for social good in their operations for decades long before CSR become a popular cause. Inspite of having such life size successful examples, CSR in India is in a very nascent stage. It is still one of the least understood initiatives in the Indian development sector. It is followed by a handful of public companies as dictated by the very basis of their existence, and by a few private companies, with international shareholding as this is the practice followed by them in their respective foreign country. Thus the situation is far from perfect as the emphasis is not on social good but rather on a policy that needs to be implemented.

7 Pinnacle Research Journals 7 A lack of understanding, inadequately trained personnel, non availability of authentic data and specific information on the kinds of CSR activities, coverage, policy etc. further adds to the reach and effectiveness of CSR programmes. But the situation is changing. And CSR is coming out of the purview of 'doing social good' and is fast becoming a 'business necessity'. The 'business case' for CSR is gaining ground and corporate houses are realising that 'what is good for workers - their community, health, and environment is also good for the business'. P&G s - SHIKSHA P&G s flagship Corporate Social Responsibility Program Shiksha is an integral part of global philanthropy program - Live, Learn & Thrive. Shiksha has had helped 280,000 underprivileged children access their right to education. Shiksha began with P&G India s research which revealed education as the one cause that consumers are most concerned about and are looking for a simple way to contribute to. With this insight and founded on P&G s purpose, Shiksha was launched in 2005 to enable consumers to contribute towards the cause of education of underprivileged children through simple brand choices. The program has built & supported over 140 schools across India, in partnership with NGOs like Round Table India (RTI) Save the Children (STC)

8 Pinnacle Research Journals 8 Army Wives Welfare Association (AWWA) Navy Wives Welfare Association (NWWA) IBM: IBM has developed a system that aligns the company s values with social responsibility initiatives and maximizes its impact as a global enterprise. With this aim company is working on specific societal issues like environment, community development, health care and education etc. TCS: Tata consultancy services is India s largest software service company and has won the Asian CSR award for initiating community development work and implementing various programs and devoting leadership and sincerity as ongoing commitment in incorporating. ITC: ITC Limited has the Objectives of Providing information technology (IT) computer education across the different villages. Major focus of the company is on creating and continuous women empowerment. BRITANNIA: Britannia is very much committed towards to be a good corporate citizen not only by obliging the terms and conditions of the law but also actively participate in the development of society and working towards the improvement of quality of life of the people where industry operates. Company has undertaken community development issues as by organizing health and family welfare programs, clean drinking water, providing free education to the poor people. Company has integrated these social responsibility practices with the business plan of the company.

9 Pinnacle Research Journals 9 ONGC: ONGC has won Golden Peacock award for excellence in corporate social responsibility in emerging economies in the year by world council for corporate governance, UK. ONGC has taken a foremost step towards providing urban amenities in rural areas this project named as PURA and as envisioned by former President A.P.J. Abdual Kalam. ONGC produces oil and gas and with this PURA project will provide the availability of isolated gas in each state BAJAJ CSR AREAS Education sector Women Empowerment Health sector Women empowerment Self reliance Rural development projects Environment & Natural Resources preservation MARUTI: Maruti is working upon conserving environment and preserving natural environment. Concept of reduce, reuse and recycle has been promoted by company in all manufacturing units. It also introduced the road safety program to prevent accidents. 5. CONCLUSION In the ever changing markets Globalization and liberalization are the buzz words. In the age of globalised world, the concept of CSR can t be ignored by the corporate firms. By keeping in mind the changing market scenario business firms have to change their work culture as per the market demands. Previously we were fighting for the issues like labor laws, factory acts and child labor But we can see the paradigm shift in the relation of corporate house and workers. Now a day s Firms and workers all together works as a family and work for achieving the common goals. Profit sharing is the main. agenda of the corporate houses. Those days have gone when basic business of business is to earn profits only. In conclusion, the findings of this study provide insights into an area of growing concern of firms towards society. Firms have been doing great effort for the achievement of business goals and marring the business goals with social responsibility practices. As per the changing market demands need of the hour is for the development of CSR framework that has been imposed by the government. So that, we can contribute to make better planet to live in. REFERENCE 1. Sharma and Kiran, A passion of large organizations or a commitment to the society, African journal of business management, In press.

10 Pinnacle Research Journals Blomback, A. and C. Wigren, Challenging the importance of size as determinant for CSR activities, International Journal Of Management Of Environment Quality, 20(3): Retrieved From Emeral. 3. Pederson, E.R., Modeling CSR: How managers understand the responsibility of business towards. society Journal of Business Ethics 4. Blomback, A. and C. Wigren, Challenging the importance of size as determinant for CSR activities, International Journal Of Management Of Environment Quality, 20(3): Retrieved From Emerald database. 5. Conceptual Framework on Corporate Social Responsibility. Journal of Business Ethics, 85: Chaudhri and Wang, Communicating Corporate Social Responsibility on the Internet A Case Study of the Top 100 Information Technology Companies in India, Management Communication Quarterly, 21(2): Lather, A.S., The case of multinational corporations: Their Corporate Social Responsibility in India and back home, Journal of Management & IT, 5(3):