Dr. Bhaskar Chatterjee 11th January, 2013, Mumbai

Defining Corporate Social Responsibility (CSR) (Wikipedia) 2 Corporate social responsibility (CSR, also called corporate conscience, corporate citizenship, social performance, or sustainable responsible business/ Responsible Business)is a form of corporate self regulation integrated into a business model CSR policy functions as a built-in, self-regulating mechanism whereby a business monitors and ensures its active compliance with the spirit of the law, ethical standards, and international norms. CSR is a process with the aim to embrace responsibility for the company's actions and encourage a positive impact through its activities on the environment, consumers, employees, communities, stakeholders, and all other members of the public sphere who may also be considered as stakeholders.

 The Indian economy has gained a lot from the role that corporates have been playing. In recent years they have become:  Key drivers of economic growth;  Delivery mechanisms for change;  Agents of innovation.  Indian corporate houses today are pervasive and have tremendous reach cutting across geographies, ethnicities, culture, languages etc. 3

 There are many outstanding examples of corporate CSR activity;  Indian entrepreneurs and business enterprises have a long tradition of working within the values that have defined our nation’s character for millennia;  Indian businesses have engaged in philanthropic and charitable activities even from pre-colonial days;  However, in recent times, organizations in India have shown both innovation and business acumen in taking up CSR initiatives and integrating them into their business processes. 4

 Our CSR Agenda should be ours. What we do in CSR should have a strong Indian orientation and we must use our CSR initiatives to address our particular Social, Economic and Environmental challenges;  Quite clearly the challenges of the nation should not and cannot be borne by government alone;  Mitigation strategies will have to include businesses with their resources which can be channeled into a diverse array of programmes to address these problems and to bring about a sustainable future for all. 5

 There are a large variety of activities/programmes to which corporates may direct their energies and indeed many corporates have developed a great deal of momentum in areas of their choice;  However, these efforts are largely individual;  There should be a greater synergy among corporates to address some areas unitedly, for a greater impact - otherwise resources would be spread too thin for tangible outcomes to emerge;  Combined efforts will lead to results that will be both demonstrable and measurable. 6

 The CSR provisions of the Bill seek to create an enabling environment;  They will allow corporates to harness and channelise their core competencies as well as develop effective business models;  They will promote and facilitate far better connect between businesses and communities. 7

 They will facilitate deeper thought and longer term strategies for addressing some of our most persistent social, economic and environmental problems;  They will assist in synergizing partnerships between Corporates, Governments and Civil Society Organizations. 8

 The Bill also provides great flexibility to business and industry for strategising and conducting their CSR initiatives;  Intention of government and purpose of bill is not to make a rigid structure which will constrain the creativity and imagination of the corporates;  It will actually enhance their efforts, provide an even broader platform and re-energize their efforts. 9

 Schedule VII of The Companies Bill draws attention to an illustrative list of activities that can be carried out under the CSR Agenda;  It could be worthwhile to concentrate our energies on some aspects of development where tangible results can be achieved within a relatively short period of time;  Some of these areas could be:  Toilet and Sanitation Facilities in rural schools, particularly for girls;  Education Projects;  Provision of Health Facilities;  Combating Malnutrition;  Skill Development. 10

 Since the Bill contemplates measurability in rupee terms, corporates may well adopt the Project Mode to execute their Corporate Social Responsibility programmes. This would involve:  Specific Allocation of Financial Resources;  Baseline Survey;  Project Preparation;  Corporate CSR Plan;  Project Monitoring;  Impact Assessment;  Third Party Evaluation. 11 Project Mode

 Although there is a growing consciousness in the area of CSR among the Indian companies, there is a need to bring all the actors together so that they can collaborate to make a significant impact towards the national goal of inclusive growth and development;  The NFCSR has been established at the IICA to help create a national platform for the corporate sector to work in partnership with the Government, Non-Governmental, Civil Society and local community organizations. 12

 Would be a global gateway and would provide the following services to corporates in the field of CSR in a single-window mode:  Knowledge and informational services;  Assistance for formulating CSR projects;  Impact Assessment and Social Audit of CSR projects;  Preparing a cadre of Certified CSR Professionals;  Training and capacity building;  Rating of CSR performance and recognition through awards;  Maintaining a Database of good practices;  Research, including action research. 13