Corporate Social Responsibility

Corporate Social Responsibility (CSR) is the continuing commitment by business to behave

ethically, contribute to economic development, improving quality of life of workforce, their
family, local community and society, build a meaningful relationship between the corporate
sector and the rest of the society. Business have to adopt practices that ensure ethical, legal,
commercial and public expectations. It must be the integrated part of day to day business
engaging all stakeholders, strategies to support individual managers to make socially responsible
decisions conforming ethical behaviour and law.

• Companies are obliged to comply with law, give the community a variety of financial and
non-financial ways and take into account the environment and social context in which the
business operates.
• Shrinking of government resources, distrust of regulations, demand for greater
disclosures, increased customer’s interests, investors pressure, competitive labour
markets etc are some of the driving forces of CSR.
• The concept of CSR involves voluntarily adopted behaviour going beyond legal
obligations, practices intrinsically connected to sustainable development and culture
incorporated into core business strategies.

Accountability, transparency, conduct in conformity with laws, business ethics, good workplaces
and labour relations practices, affirmative actions / good practices, customers loyalty and
satisfaction, environmental benefits and company involvement with community are some of the
components of CSR.

Triple Bottom line reporting on resources and market reputation, improved ability to understand
business performance and risks, attract quality employees, greater profile for raising capital are
few benefits of CSR.
CSR in India

Introduction:

Corporate Social Responsibility (CSR) is on the rise all over the world and in India also. Civil
Societies, consumers and other actors have increased pressure on companies to adhere to social
and environmental standards and this pressure has impacts on the business in India. Limits of
regulatory initiatives, changing nature of judicial activism, governments greater relevance on
private enterprises etc. places greater responsibility on voluntary approaches as an alternative
means of building social rights. Voluntary initiatives for environmental protection have been
restricted to large firms.

CSR is often guided by the commitment of the top management. With compliance and
enforcement slack, employee’s care is just employers’ benevolence, environment care and total
quality management are driven by market forces and legislation, CSR is considered as an
additional activity of Human relation and public relation department. Democratic institutions
need to be strengthened for steady movement, towards strengthening of enforceable regulation.
Space to be created for various actors to operate, provide, support and resistance as required
government need to be re-engineered so that civil society vigilance can reinforce its regulating
and monitoring roll. Re-engineering of government requires active defence or advocacy of
constitutional rights from court to civil society. A new initiative, Corporate Responsibility for
Environmental Protection (CREP) was initiated by the Government of India.

Industry Association Initiative

• Leading Chambers of Commerce and Industry of India are traditionally active in social
and environmental norms.
• Federation of Indian Chambers of Commerce and Industry (FICCI) and Confederation of
Indian Industry (CII) work closely in partnership with Government and other
ogranistions.
• Social Development Council (SDC) set up by CII, ensures corporate’s participation in
social development and provide an institutional base for social activities of the corporate
sector.
• SDC focuses on community development, disaster management, education and literacy,
population and health (including HIV & AIDS), vocational training and women’s
empowerment etc.
• CII in partnership with UNDP, set up India Partnership Forum to promote multi
stakeholders approach to CSR.
• Indian Business Trust for HIV / AIDS was set up by CII to help extent the impact of
national programme for prevention and control of HIV / AIDS.
• Social summit being organized every year by CII to provide opportunities and platform
for companies to take up social responsibility
• CII has established Environment Management Department (EMD) to undertake a range
of activities like environmental research, organizing practical initiatives, etc.
• FICCI focuses more on environmental issues of significances to Indian Industry.
• FICCI set up Socio Economic Development Foundation (SEDF) to deal with CSR
• FICCI has an Environmental Information Centre that complies and disseminates
information on environmental issues.
• Awards, were instituted by FICCI for corporate initiatives in environmental
conservations and pollution.
 • Progress, Harmony and Development chambers of commerce and Industry (PHDCCI)
has major interventions in family welfare and rural development through its foundations
PHD Family Welfare Foundation, PHD Rural Development Foundation respectively.
• Associated Chambers of Commerce and Industry of India (ASSOCHAM) through their
members provided drinking water in 110 villages by 1996 on occasion of its platinum
Jubilee.
• Bombay Chambers of Commerce and Industry (BCCI) has been consistently on issues of
populations and civic conditions in Mumbai.

The Global Compact in India

• The Global Compact UNGC is a voluntary value based initiative complementary

regulations and other voluntary initiatives.
• Main objective is to mainstream the 10 CSR principles relating to human rights, labour,
environment and anti-corruption which companies are expected to adopt within their
sphere of influences of catalyse actions in support of UN goals.
• Global Compact was launched in Mumbai at a high level meetings
• To exchange experiences and implement GC principles, the Global Compact Society
(GCS) was formed in 2003.
• Main objective of GCS is to provide a forum for Indian Companies and organizations to
exchange experienced and work together on activities related to CSR.
• GCS undertakes activities to create awareness assist GC participant to internalize
UNGC’s 10 principles, facilitating projects among participants, etc.
• GCS planned projects
o Organising National Convention
o Interacting with various India & UN officials
o Developing data bases of member and their activities
o Organising meetings / workshops to facilitate the exchange of experiences and
skill development
o Facilitating projects aimed at implementing GC companies.
Codes / Standards / Principles on CSR

A code of conduct is a document that outlines a set of behavioural principles and expectations.
The contents, principles, implementation and monitoring of these codes are the key issues
involved in the document. The purpose is to regulate the behaviour of persons or entity in any
organizational structure. These codes promotes standards of ethical business practices.
Following codes, principles, standards, etc addresses a broad spectrum of Corporate Social
Responsibility and Sustainable development.

1. Universal Declaration of Human Rights

• Adopted by United Nations, this declaration paved way for many international human
rights standards for all sectors entities.

2. UN Global Compact
• An international multi-constituent, voluntary initiative based on internationally
accepted ten principles in pursuit of a more sustainable inclusive global economy.
• Provides a framework for invocation, creativity, best practices
• Assist companies incorporating a greater level of social responsibility in their
operations
• Not a substitute for regulatory structure
• The ten principles, to be integrated in own business operations and broader spectrum
impacted by their business
• The ten principles covers human rights forced labour, child labour, environmental
challenges and responsibility, non discrimination, freedom of associations, collective
bargaining, corruption, etc.

3. Global Reporting Initiative (GRI)

• Established for developing globally applicable guidelines for reporting on economic,

environmental and social performance of any business.
• Its Sustainability Reporting Guidelines provides a reporting standard which enables
companies to enhance the quality of their reports.

4. The Global Sullivan Principles

• The principles consists of eight single sentences value statements that addresses a
range of human rights related issues
• Encourage companies to support economic, social and political justice wherever they
do business.

5. Benchmarks for CSR

• Drafted for measuring Business Performance in response to globalization of economy
and growth of transnational corporations.
• It offers 100 principles, outlining philosophies to ensure responsible company actions,
129 criteria, relating to company’s commitment to implement improved corporate
performance which develops relevant policies and practice and 118 benchmarks to
assists companies about responsible corporate behaviour.

6. OECD Guidelines for Multi national Enterprises

• This organization for Economic Co-operation and Development guidelines contains
recommendations on core labour, environmental standards, human rights,
 competition, taxation, science and technology combating corruption and safe
guarding, consumer rights.
• Encourages responsible business practices, strengthen relationship between
government and multinational enterprises, enhance contribution of multi national
enterprises to sustainable development and plays prominent role in fostering good
governance in the public and in corporate activity.

7. Social Accountability 8000

• A code of conduct verification and factory certification programme.
• Specifies requirement for social accountability to enable a company to develop,
maintain and enforce policies and procedures in order to manage those issues which it
can influence or control.
• Covers standards and monitoring programmes for child labour, forced labour,
disciplinary practices, non discrimination, wages and benefits, working hours, health
and safety, freedom of associations and collective bargaining and management
system etc.
• Applies regardless of geographic locations, industry sector, or company size.
• The standard is maintained by Social Accountability International.

8. Principles for Responsible Investment (PRI)

• A set of global best practice principles for responsible investment
• Provide a framework for achieving better long term investment returns and more
sustainable markets.
• The six voluntary principles are underpinned by a set of 35 possible actions that
institutional investors can take to integrate environmental, social and corporate
governance considerations into their investment activities.

9. APEC
• Asia Pacific Economic Corporation, APEC is an international organization for
economic co-operation among the pacific rim countries.
• The code is an inspirational standard that draws significally on a variety of
internationally recognized codes and standards.
• The code addresses policy recommendations to APEC country governments

10 Role of ILO
• ILO seeks the promotion of social justice and internationally recognized human and
labour rights.
• Formulate international labour standards in the form of conventions and
recommendations setting minimum standards of basic labour rights.

11. ISO develops new standards on Social Responsibility

• ISO is an International Standard setting body.
• ISO is developing a new standard on Social Responsibility namely ISO 26000
• ISO 26000 is intended for use by all types of organizations and in all countries and to
assist organization to operate in a socially responsible manner
• This standard will be consistent with and would complement relevant declaration is and
conventions of UNO & ILO and the ten principles of UN Global Compact.
• This standard will not be used for certification and contains guidelines providing issue
specific guidance.
• This standard is to be published in Nov., 2009.