Monday, 11 February 2019

Essay on Corporate Social Responsibility in INDIA for UPSC


Essay on Corporate Social Responsibility in INDIA for UPSC

Corporate Social Responsibility in INDIA
It is recognized that the world over integrating social, environmental and ethical responsibilities into the governance of businesses ensures their long term success, competitiveness and sustainability This approach also reaffirms the view that businesses are an integral part of society, and have a critical and active role to play in the sustenance and improvement of healthy ecosystems, in fostering social inclusiveness and equity, and in upholding the essentials of ethical practices and good governance Many companies have been quick to sense this development, and have responded proactively while others have done so only when pushed.

In the past, businesses primarily concerned themselves with the economic results of their decisions. Today, however, businesses must also reflect on the legal, ethical, moral and social consequences of their decisions. It is important for businesses not only to provide products and services to satisfy the customer, but also to ensure that the business is not harmful to the environment in which it operates. In order for an organization to be successful, the business must be built on ethical practices. Companies are increasingly pressurized to behave ethically. This pressure comes from customers, consumers, governments, associations and the public at large.

This also makes business sense as companies with effective CSR, have image of socially responsible companies, achieve sustainable growth in their operations in the long run and their products and services are preferred by the customers. Although the roots of CSR lie in philanthropic activities (such as donations, charity, relief work, etc.) of corporations, globally, the concept of CSR has evolved immensely. It now encompasses all related concepts such as triple bottom line, corporate citizenship, philanthropy, strategic philanthropy, shared value, corporate sustainability and business responsibility.

The term 'Corporate Social Responsibility (CSR)'came about in the late 1960's and early 1970's after many multinational corporations used it to describe organizational activities that impacted their responsibility towards the greater environment. Today, Corporate Social Responsibility is no longer defined by how much money a company contributes to charity, but by its overall involvement in activities that improve the quality of people's lives. It has come up as a significant subject matter in the international business community and is progressively becoming a mainstream activity. There is mounting recognition of the momentous effect the activities of the private sector have on the workforce, clientele, the society, the environment, competitors, business associates, investors, shareholders, governments and others groups. It is also becoming progressively clear that organizations can contribute to their individual wealth and to overall community wealth by taking into account the effect they have on the entire globe when making decisions One of the more contemporary definitions is from the World Bank Group, stating, "Corporate social responsibility is the commitment of businesses to contribute to sustainable economic development by working with employees, their families, the local community and society at large, to improve their lives in ways that are good for business and for development."

The World Business Council for Sustainable Development (WBCSD) defines CSR as "the continuing commitment by business to contribute to economic development while improving the quality of life of the workforce and their families as well as of the community and society at large."
CSR originated in philanthropy. Currently it supports projects external to the normal business activities of a company that are not directed towards making a profit. Typically, such projects have a strong developmental approach and utilize company resources to benefit non-profit organizations and communities.

It is a concept whereby organizations consider the interests of society by taking responsibility for the impact of their activities on customers, employees, shareholders, communities and the environment in all aspects of their operations. This obligation is seen to extend beyond the statutory obligation to comply with legislation and sees organizations voluntarily taking further steps to improve the quality of life for employees and their families as well as for the local community and society at large.

The protection of the environment has become the center stage of many humanitarian organizations. Most of these humanitarian organizations argue that the protection of the environment should be the key concern of any corporation. This is because the environment is the only natural resource that is invaluable to the human race. The issue of handling industrial waste by many corporations has always been at the forefront of many environmental organizations. This is because corporations are guilty on more than one accord of irresponsibly handling their waste. Evidence such as the great pacific garbage patch exists to show how many corporations are not handling the dumping of waste seriously. The great pacific garbage patch is a myriad of human waste that has found its way into the ocean after being improperly dumped. The great pacific garbage patch leads to problems such as loss of aquatic life and the contamination of the water not mentioning the corporate introduction of many pollutants into the water.

Corporate social responsibility makes it clear that it is certainly unethical for these corporations to be making profits at the expense of the environment and other aspects of the human life. It is therefore viewed as a control mechanism to ensure that multi-corporations are responsible for their actions.
The 21st century is characterized by unprecedented challenges and opportunities, arising from globalization, the desire for inclusive development and the imperatives of climate change. Indian business, which is today viewed globally as a responsible component of the ascendancy of India, is poised now to take on a leadership role in the challenges of our times. Companies too have been the target of those perturbed by this uneven development and as a result, their contributions to society are under severe scrutiny. With increasing awareness of this gap between the haves and the have notes, this scrutiny will only increase over time and societal expectations will be on the rise.

India is a country of myriad contradictions and diversity. On the one hand, it has grown to be one of the largest economies in the world, and an increasingly important player in the emerging global order, on the other hand, it is still home to the largest number of people living in absolute poverty (even if the proportion of poor people has decreased) and the largest number of undernourished children. What emerges is a picture of uneven distribution of the benefits of growth which many believe, is the root cause of social unrest.

CSR in India has traditionally been seen as a philanthropic activity; it was an activity that was performed but not deliberated. In other words, it is referred to as teleological ethics. Though it still remains within the philanthropic space, but the Companies Act, 2013 has introduced the idea of CSR to the forefront and through its disclose-or-explain mandate, is promoting greater transparency and disclosure. It has moved from institutional building educational, research and cultural) to community development through various projects. Also, with global influences and with communities becoming more active and demanding, there appears to be a discernible trend, that while CSR remains largely restricted to community development, it is getting more strategic in nature (that is, getting linked with business) than philanthropic, and a large number of companies are reporting the activities they are undertaking in this space in their official websites, annual reports, sustainability reports and even publishing of CSR reports.

This is evident from some of the notable contributions made by companies in Indian society. Ashok Leyland operates a Fun Bus in Chennai and New Delhi. This bus, equipped with a hydraulic lift, takes differently able children and those from orphanages and corporation primary schools on a day's picnic. Bharat Petroleum Corporation's rain water harvesting project "Bond", in association with the Oil Industries Development Board, selects draught-stricken villages to turn them from "water-scarce to water-positive". The Computer Based Functional Literacy (CBFL) initiative for providing adult literacy by Tata Consultancy Services has benefitted approx. 1.2 lakh people. This program is available in nine Indian languages.

As the business environment gets increasingly complex and stakeholders become local about their expectations, good CSR practices can only bring in greater benefits. Globally, the notion of CSR and sustainability seems to be converging, as corporate social responsibility and sustainability are so closely entwined, it is a company's commitment to its stakeholders to conduct business in an economically, socially and environmentally sustainable manner that is transparent and ethical. Thus, a major corporate thrust toward ethical and socially responsible behavior is to go green.

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