BUSINESS REGULATION AND CORPORATE CONDUCT (BRCC Project) Project Overview & Draft Thematic Research Report

The Project Objective: To examine the relationship between business regulation and corporate conduct in the context of sustainable, economic growth in India. Partner: Norwegian Institute of International Affairs (NUPI) Aim: Comprehend (through research and fieldwork) constraints in business regulation in select Indian states and motivate corporate entities (through dissemination and advocacy) to emerge as champions of responsible business conduct Four States & Two Sectors

Purpose of the Project Appropriate actions by government, civil society and business community for creating an enabling environment and motivations for firms to evolve as ‘Responsible Corporate Citizens’, in addition to being harbingers of the ‘Indian Growth Story’

Outcomes anticipated Enhanced understanding of the interplay between business regulation and corporate conduct at sectoral, state and national levels Policy inputs for reforming business laws Improved skills among Indian government and business representatives to pursue better and responsible business conduct Stimulation of more policy-relevant research and advocacy on the subject

Project Outputs Identification of specific constraints to business promotion in four Indian states ‘Good case practices’ related to corporate conduct (corporate governance and CSR) in two sectors State level policy inputs for sustainable business promotion National level policy inputs for balancing business regulation and corporate conduct

Project Outputs Training modules on business regulation, corporate governance and CSR relevant for Indian states Research products and their dissemination through popular media: One thematic research report and briefing paper; four research reports on enabling business environment (one for each state) and corporate conduct (two sectors); one monograph on enabling business environment and corporate conduct (two sectors); one policy brief and four state level policy papers and one national policy position paper.

Activities under the project 1. Preparatory Work & Inception Meeting2. Thematic Research3. Regional Dialogues on Thematic Issue4. Development of pilot programmes (State Level)5. Research on Business Regulation (State Level) in four states6. State level Dialogues on Business Regulation

Activities under the project 7. Research & State Level Dialogues on Corporate Governance & CSR (two sectors) 8. National Policy Forum9. State Level Policy Inputs 10. Training Modules and Capacity Building (Training) Programme 11. Final Project Report Submission & Wrap-up

Key Questions of the project Key Question-What are the elements of business regulation that are likely to stimulate responsible behavior among firms operating in India? Should business regulation and responsible behaviour of large firms be of interest to the study? Should the focus be on business regulation in a single sector and the entire supply chain linkages that can be explored? Should either the primary or secondary research focus on the SME sector to build a policy paper?

Research Methodology The questions that this project seeks to answer are at the level of the economy, sector and the firm

MACRO LEVEL: ECONOMY AND SECTOR How does regulation (legal and voluntary Guidelines) around responsibility impact country/state level economic performance? Do certain states have a better track record in managing responsible behaviour of corporations and yet achieving economic development – what are the emerging lessons for other states? Does political constituency influence the distribution of ethical considerations across states? How does regulation (legal and voluntary Guidelines) around responsibility impact sector level economic performance?

MICRO LEVEL: FIRM How does regulation (legal and self) around responsibility impact economic performance of firms, and vice versa? Can profitability and sustainability be achieved in tandem – what are the challenges and opportunities? Do state level regulations impact business conduct of corporations differently?

MICRO LEVEL: FIRM What broad policy and legislative issues govern the decision of a firm to invest (or an entrepreneur to set up a business) in a particular state – is there a cross-country analysis of such experience of firms available? What are the drivers for businesses to adopt a differential approach to responsible business conduct in different states?

Activities for Research Question: Macro Level Literature review Draft Thematic Research Report Identifying the states (4) Gujarat and Tamil Nadu natural selection A national policy position paper

Activities for Research Question: Micro Level Secondary review of literature, articles and periodicals needs pertaining to firm level issues Include the SME’s and therefore, existing work by UNIDO, MSME Foundation etc Identify sectors whose economic contribution is significant and likely significant social contribution Examine a sample of firms within the sector Develop a thematic interview protocol

Research Outputs A thematic research report highlighting the main research question(s) Four state-level research reports on state-level business regulation and its implication for corporate responsibility Two sectoral reports that highlight how ‘good’ corporate conduct results from enabling business regulatory measures

Research Outputs One monograph collating the experience gathered in the states and sectors – highlighting the interplay between business regulation and corporate conduct A National Policy Position Paper – distilling the findings of the research and suggesting measures that could be taken to stimulate greater corporate responsibility in the country Training and capacity building materials for state-level

Thank you