‘Parhit saris dharma nahi bhai’, meaning, there is no better dharma as working for the benefit of everyone. The concept of CSR revolves around the saying from Ram Charit Manas. CSR or Corporate Social responsibility as the name suggests, is the responsibility of the corporate towards the society in which it exists and function.
CSR is not a modern day business strategy but has existed since the 19th Century in various countries in different versions. For India, It can be traced back to the period much before pre-independence when rich families or then kings used to spend huge amount of the money towards the development and benefit of the society, e.g. building temples for religious sentiments or providing food to the poor families, supporting the citizens during natural calamities like draught or hurricane, providing night shelters etc. The great leader Mahatma Gandhi supported the concept of CSR by his own theory of Trusteeship. As per his concept of trusteeship, he wanted capitalists to act as trustees (not owners) of their property and conduct themselves in a socially responsible way.
CSR is a methodology or process to cultivate the mutually profitable alignment of organizations with the societies that they are operating from and at the same time analyze the importance and obligation of contributing towards the same. CSR should be treated as a mandatory KRA (key responsibility area) of every organization so that the entire Ecosystem gets benefitted from their existence in some form or the other. There are many organizations (and Non Profit Organizations) across the globe that are supporting generously towards the same cause and is a priority for them just like their business. As per the recent UN report, about 8,000 organizations across the globe have signed a UN Global Commitment pledging to exhibit good citizenship in the areas of Human Rights, environment protection and Labour Reforms.
With the publication of Ruggie report (2008) on Human Rights and transnational corporations, many companies globally are opening up to the value of human rights and integration of same, throughout the company in order to fulfil the corporate responsibility. Considering the role of effective CSR in any organization, it cannot be just a team of people having a list of ideas that they can do in the name of a Company and have a “we do this” poster and simply use the same to talk about it and generate goodwill from the internal employees or stakeholders. In order for the CSR to be an effective, well implemented and result oriented function, it is important that CSR is very well knitted into the company’s business practise or strategy. The Management must be responsible for the CSR implementation, whether in the domain within the business or something for the direct benefit of the society.
Having said that, CSR is no more a response act. It is more of a planned and forecasted strategy. While implementing or designing a CSR program, company must work on its strength and scope and based on the same it will be decided what needs to be done, how can it be done and who is going to get benefitted by the act. On the basis of this self revelation, companies would understand how they are contributing to the society. These days companies are either managing the CSR activities in an association with Non Government Organization (NGOs ) or companies are doing it on their own by setting up channel offices or centres or tying up with local bodies etc. .CSR can be a wonderful employee engagement tool. As per a report from an MBA institute, 85% of MBA students feel that organization must be involved in CSR activities. Companies, which focuses on CSR and where employees are involved in being a part of the same, there is a high level of engagement and retention percentage since employees feel involved in the organization’s activities and at the same time also get satisfaction when they contribute to the society. Infact these days, various Management colleges are taking up CSR projects across industries and the students are required to work on the project, do an analysis and prepare a report that can be used by the corporate and students are given grades on the basis of that.
Any company engaged in CSR activities gets the added benefits of high spirited employees, good brand image which attracts more and more people applying for jobs ultimately resulting in increased sales and customer loyalty etc. A company can have a successful CSR program only if the zeal to give it back to the society is in the blood and DNA of the company’s philosophy. The management must believe in the same and should be able to nail it down to its employees by integrating it with the part of their Job and responsibilities and keep their motivation uplifted by rewarding them for their contributions on a regular basis. A modern day concept termed as “Strategic Philanthropy” by Michel Porter, refers to contributing to the society using it as a business model. This concept ensures that the company is making money while contributing to some sections of the society. Such categories of CSR activities plus business models help the companies survive in the long run by innovating a lot of society relevance products leading to more and more demands to come.
Projecting some of the future trends of CSR, we will see the scope of CSR getting stretched from local to global platform due to the ever increasing globalization. Innovations and creativity is going to play a major role with corporate engaged in delivering “Out of box” ideas for CSR activities with the embedded involvement of employees, social media platform and technology. Government should come with some kind of categorisation of such activities and ranking the companies according to the activities performed and based on ranking, companies must get some subsidy or tax benefit. In the coming years, CSR will take up a place where the business units are CSR driven so that every functional unit in the company would be integrated with CSR in some form of other, be it utilizing solar energy for the production purpose or generating reusable and recyclable waste in a factory unit or using battery operated vehicles for the logistics purpose etc.
With an ever changing dynamics of the industries, companies need to have a robust vision and mission and CSR can provide answers to the critical business situations by driving business ideas, innovations and employees at the same time.