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OVERVIEW OF CSR & GLOBAL PROFESSIONAL OPPORTUNITIES
IN CSR
CA. Rajkumar S AdukiaCouncil member ICAIChairman ind as(IFRS) implementation committeeCommittee on cooperatives & NPOEconomics group ICAIB.Com (Hons.) FCA, ACS,MBA, ACMA, LLB ,Dip IFRS(UK) DLL& LW,Dip criminologyrajkumarradukia.caaa.in09820061049/09323061049
CORPORATE SOCIAL RESPONSIBILITY
• CSR – Also referred to as corporate conscience, corporate citizenship, social performance, or sustainable responsible business/ Responsible Business
• CSR is a form of corporate self-regulation integrated into a business model
• The term, “corporate social responsibility” is used to envelop both social and environment issues
ORIGIN OF CSR
• The fundamentals of CSR rest on the fact that not only public policy but even corporates should be responsible enough to address social issues
• Known as social responsibility (SR), the modern era of CSR started in the 1930s
• The attempts to define CSR grew significantly in the 1960s and became more specific in the 1970s
DEFINITIONS
• Howard Bowen - American economist (1953) was one of the first authors who attempted to define CSRAccording to Bowen - CSR is the policies, the decisions, and the actions that align with the goals and values of society
• Archie B. Carroll. Professor Emeritus, University of Georgia - (1979) thought that the economic component should be included in the definition of CSR. He defined it as - “The social responsibility of business encompasses the economic, legal, ethical, and discretionary expectations that society has of organizations at a given point in time”
EVOLUTION OF CSR IN INDIA
The history of CSR in India has its four phases:
• The First Phase: (pre-industrialization period, which lasted till 1850 - CSR motivated by charity and philanthropy)
• The Second Phase: 1850-1960(during the independence movement - CSR for India’s social development)
• The Third Phase: (1960–1980 - CSR under the paradigm of the mixed economy)
• The Fourth Phase: (1980 - present)
The First Phase: (pre-industrialization period, which lasted till 1850 - CSR motivated by charity and philanthropy)
• Charity and philanthropy were the main drivers of CSR• wealthy merchants shared a part of their wealth with the
wider society by way of setting up temples for a religious cause
• change in approach with the arrival of colonial rule in India from the 1850s onwards
The Second Phase: (during the independence movement – CSR for India’s social development)1850-1960
• Mahatma Gandhi introduced the notion of "trusteeship", • according to this notion - industry leaders had to manage
their wealth so as to benefit the common man• Under his influence businesses established trusts for schools
and colleges and also helped in setting up training and scientific institutions
• The heads of the firms largely aligned the activities of their trusts with Gandhi‘s reform programmes
• These programmes included activities that sought in particular the abolition of untouchability, women‘s empowerment and rural development
The Third Phase: (1960–1980 - CSR under the paradigm of the mixed economy)
• emergence of Public Sector Undertakings (PSUs) and laws relating labour and environmental standards
• The policy of industrial licensing, high taxes and restrictions on the private sector led to corporate malpractices
• This led to enactment of legislation regarding corporate governance, labour and environmental issues
• PSUs were set up by the state to ensure suitable distribution of resources
• public sector was effective only to a certain limited extent - shift of expectation from the public to the private sector and their active involvement in the socio-economic development of the country became absolutely necessary
The Fourth Phase: (1980 - present)
• Indian companies started to integrate CSR into a sustainable business strategy
• In the 1990s the first initiation towards globalization and economic liberalization were undertaken which gave a boost to the economy
• the increased profitability increased business willingness as well as ability to give
CSR PRACTICES AROUND THE GLOBE
• www.globalreporting.org amsterdam, the netherlands• Global Reporting Initiative (GRI)
Sustainability Reporting Framework by the GRI• www.iso.org geneva switzerland• ISO 14001 - Environmental management systems
given by the International Organization for Standardization • ISO 26000 – Social Responsibility
given by the International Organization for Standardization • www.sa-intl.org new york• SA 8000 - auditable certification standard
given by Social Accountability International • www.accountability.org• AA 1000 – Series of Standards
given by AccountAbility – a global NPO
CURRENT CSR SCENARIO IN INDIA:
• The basic objective of CSR in these days - maximizing the company's overall impact on the society and stakeholders
• CSR policies, practices and programs - comprehensively integrated throughout business operations and processes
• Formation of specialised CSR teams in companies• Corporates increasingly joining hands with Non-governmental
organizations (NGOs)• CSR made a part of legal framework
CSR LAWS IN INDIA • National Voluntary Guidelines for Social, Environmental
and Economic Responsibilities of Business (NVG) 12th july 2011Given by Ministry of Corporate Affairs – India
• Business Responsibility Reports (BRR) – SEBI - mandated the top 100 listed companies of BSE & NSE to report under the BRR aug 13, 2012 added clause 55 to listing agreement
Section 135 wef 1st april 2014 Companies Act, 2013 (India)
Clause 55 of listing agreement
• Business Responsibility Report – Suggested Framework
• Section A: General Information about the Company
• Section B: Financial Details of the Company• Section C: Other Details • Section D: BR Information
Clause 55 of listing agreement Section E: Principle-wise performance
• Principle 1: Businesses should conduct and govern themselves with Ethics, Transparency and Accountability
• Principle 2: Businesses should provide goods and services that are safe and contribute to sustainability throughout their life cycle
• Principle 3: Businesses should promote the wellbeing of all employees
Clause 55 of listing agreement Section E: Principle-wise performance
• Principle 4: Businesses should respect the interests of, and be responsive towards all stakeholders, especially those who are disadvantaged, vulnerable and marginalized.
• Principle 5: Businesses should respect and promote human rights
• Principle 6: Business should respect, protect, and make efforts to restore the environment
Clause 55 of listing agreement Section E: Principle-wise performance
• Principle 7: Businesses, when engaged in influencing public and regulatory policy, should do so in a responsible manner
• Principle 8: Businesses should support inclusive growth and equitable development
• Principle 9: Businesses should engage with and provide value to their customers and consumers in a responsible manner
CSR - PROFESSIONAL OPPORTUNITIES
1. Consultancy in CSR2. Business responsibility reports
SEBI3. Accounting for CSR4. Taxation for CSR5. Application of FCRA6. Application & compliance with
FEMA7. Advising on NPO Governance8. Grading/ Rating NPOs9. Social Audit
10. Selection of NPOs –a. Trustb. Societyc. Companyd. Non Trading Corporations11. Consultants in funding – India
& outside India12. Complying with Standards13. Integrated Reporting14. Internal audit of CSR
DEVELOPING WORK IN CSR
• Writing articles in CSR related magazines and other publications• Participating as speaker in conferences• Communicating with people related to CSR activities• Building a CSR information website• Writing books on topics covered under CSR• Projecting oneself as a CSR Expert• Reaching out to the prospective service receivers• Using social media to reach more number of people related to
CSR• Increase expertise in the field of CSR by undertaking capacity
building initiatives
