Pranjal Kumar Phukan
- Comments on the Mandatory 2% contribution to CSR
Comments: The norms as applied is commendable step taken by the Govt. of India as it will create the environment for CSR for all corporate bodies (with at least profit of INR 5 crores or INR 1000 crores turnover or INR 500 crores as Net worth). Secondly the need of taking approvals from the board for CSR activities will stream line the process. Though it is the major concern to all corporate bodies and NGOs regarding 2% mandatory contributions, I believe that the steps taken will make way for continual improvements towards well-being of citizens of the country.
2. Sustainable Development the concept and practice: your comments please.
Comments: Sustainable development is a popular and important concept, but one that is difficult to define with precision and, therefore, difficult to measure. The concept of “sustainable development” has its roots in forest management as early as the 12th to 16th centuries. In 1980, the International Union for the Conservation of Nature published a world conservation strategy that included one of the first references to sustainable development as a global priority. In 1982, the United Nations World Charter for Nature raised five principles of conservation by which human conduct affecting nature is to be guided and judged. In 1987, the United Nations World Commission on Environment and Development released the report Our Common Future, now commonly named the ‘Brundtland Report’. There should be practical set of sustainable development indicators that might serve as the basis for international comparisons. This set is consistent with the capital approach and with the most common elements of existing policy-based indicator sets.
3. “Inequality will be a driving force for new thinking about greater commitment to ethics, morality in business decisions and capitalism itself”:
Comments: Conservative economists argue there is no evidence that rising inequality impedes growth; more liberal economists contend that such a great disparity is harmful to progress. The empirical literature is mixed on the topic. What is not mixed, however, is the growing popular sentiment that inequality is going to garner more and more attention in discussions about the structure of capitalism. Inequality will continue to be a critical topic for discussions about healthy economic development and growth for years to come. Kapil Kumar Sopory raised a caution: “The idea of developing a conscious culture with shared values that reflect the higher purpose is very laudable, but it needs a lot of close attention to what sort of high values are to be focused on …”
4. The next generation of leaders will be more socially concerned and committed as employers, consumers and investors :
Comments: For concepts, ideas and movements to take hold, next generation of leaders must have deeper resonance than just advocacy or a loud voice carried over the media. They must also have institutional embeddedness and must have a tie to the teaching that goes on in classrooms where the next generation of leaders is trained. In business school classrooms, students are offered courses on CSR, social accountability, leadership and corporate accountability, and authentic leadership. In extracurricular activities, we see the prominence of organizations such as Net Impact, the nonprofit looking to use the talents of business students to support social and environmental causes. This next generation of students is going to see the stewardship of organizations – as employers, consumers and investors – in a much different way than today’s leaders.
5. Principles of Responsible Investing: has a commitment of over 20 Trillion USD, will this affect Indian companies? And how?
Comments: No one denies today the reality of climate change, losses to biodiversity and resource depletion, or at least almost no one. We need finance in order to effectively channel capital into helping resolve these issues. The investment required to modify our economic and ecological trajectory is enormous. Sustainable and responsible investment professionals have changed the investment industry by challenging and shifting traditional notions of investment practices. In so doing, they have brought to market new investment options and services across a wide array of asset classes that appeal to both individual and institutional investors, perform competitively and help address serious social and environmental challenges. They have made a difference by using active share ownership and engagement strategies with some of the largest global corporations to encourage more responsible and forward-thinking practices. Nine companies that specialize in impact investment reportedly will be establishing the “Indian Impact Investor Council” (IIIC) to establish guidelines helping investment companies in India regulate their efforts to meet social goals. These companies include Aavishkaar of India, which specializes in impact investments in rural initiatives; US-based Omidyar Network, which funds companies engaged in economic development initiatives; Elevar Equity, which was funded by US-based Unitus and finances initiatives targeted at “large, socially coherent but disconnected groups”; and India-based Unilazer Ventures, which offers funding and business advice to startups engaged in economic development.
6. Sustainable development demands a change in processes, policies and products of a company: is this an opportunity or a threat for Indian corporates?
Comments: Sustainable development is good business in itself. It creates opportunities for suppliers of ‘green consumers’, developers of environmentally safer materials and processes, firms that invest in eco-efficiency and those that engage themselves in social well-being. These enterprises will generally have a competitive advantage. They will earn their local community’s goodwill and see their efforts reflected in the bottom line. Businesses also face trade-offs when dealing with the transition to sustainable practices. For example, a chemical company whose plan t has excessive effluent discharges might decide to replace it with a more effective treatment facility. But should the company close the existing plant during the two or three-year construction period and risk losing market share? Or should it continue to operate the polluting plant despite the cost of fines and adverse public relations? Which is the better course of action in terms of economy, social wellbeing and the environment? Besides sustainability reporting, smaller businesses will have to adapt to the new corporate climate with less in-house expertise, fewer resources and less formal management structures than larger corporations. It will be difficult for them to keep abreast of ever-changing regulatory requirements.
7. What opportunities do you see for education institutes in the growing field of CSR and Sustainability
a. As in knowledge management, consulting and policy development.
Comments: Challenges for today’s international environmental policy analysts include: controlling global climate change, considering environmental regulations in treaties and trade agreements, creating environmentally and economically sustainable development, and helping the private sector find ways to incorporate environmental concerns into business planning. In much of the world, basic environmental management such as water resources, wetlands protection and restoration, and environmental health are also very important developments as economic progress puts stress on existing systems. Career-related activities within this field include policy and scientific research, environmental education and advocacy, regulatory and legislative design, technical assistance to government agencies for planning and management, regulatory compliance and enforcement, and entrepreneurial development in environmental products and services. Institutes can provide strategic analysis and advice on institutional leadership, management, research and innovation in a global knowledge economy, and reform and governance in higher education.
b . Developing new programs.
Comments: Institutes need to identify and communicate good practice case studies in HEI teaching and research, community relations and institutional management. Institutes are requiring forming a link between knowledge generation and transfer of knowledge to society for their entry into the labor market. Such preparation includes education of teachers, who play the most important role in providing education at both primary and secondary levels. Second, they actively contribute to the societal development through outreach and service to society. Students who undertake work based learning periods in public and private sector and graduates disseminate the ideas and practices of sustainability and Corporate Social Responsibility strategy to the world of work in local enterprises, public sector organizations and NGOs.
- “Companies that create employee-driven CSR programs help workers feel a sense of greater purpose; helps attract and retain top talent; and provide strong platforms for employee leadership and development. In today’s world, employee volunteer programs are an essential component of a company’s CSR approach, one which unquestionably benefits employees, the community and the company.”
a. What is your opinion on the same? Please give a descriptive answer.
Comments: Indeed, numerous studies indicate that consumers gravitate towards brands that demonstrate CSR and away from businesses that don’t practice good corporate citizenship. For example, one study found that that 80% of the 250 most profitable companies globally filed CSR reports in 2008, while another report concluded that CSR was associated with an increase in return on assets of between 1.8 and 2.5%. Also it’s clear that employees are equally concerned about the corporate company they keep. One study from job search site TheLadders, for example, reported that 72 percent of workers said they would choose a job at an eco-friendly company over another company if given the choice. Employees are desperately looking for ways to create meaning at their jobs and feel good about their work. CSR leaders are desperately looking for ways to engage their employees.
9. In your opinion,
a. What is the opportunity for CASI in India?
Comments: Before we delve in, if you’re part of a corporation, take a minute to think about some of the programs you offer that can be considered socially responsible (in short, they should be positively impacting the community). Are there any programs that you know of? If they exist, what kind and how much of an impact are they having on the local community? How engaged are employees in these programs? A corporation’s public image is at the mercy of its social responsibility programs and how aware consumers are of them (remember, this is the biggest obstacle – education and awareness)! According to a study by Cone Communications, 9 out of 10 consumers would refrain from doing business with a corporation if there exists no corporate social responsibility plan. CaSI has the immense opportunity to promote the cause, knowledge and education in India to ensure that each employee and employer has the basic knowledge of CSR & Sustainability.
b. Being a Global Brand, CASI has a terrific reach, which strata of the society do you think we should reach out to further?
Comments: CaSI should target all types of organizations viz., Large, Medium and Small and all level of employees starting from junior level to senior level. Also CaSI should focus on Lower and middle level strata of the society. This will help in understanding and proliferating the basics of CSR & Sustainability among the people and take benefit of the same.
c. How do you think senior management practitioners would benefit from CASI certifications?
Comments: Senior management practitioners will get the cutting edge research which will help them to develop right approach towards CSR. They can develop and implement CSR program based on the knowledge and expertise of CaSI.
10. CASI works with academicians in consulting assignments, please give your comments on how do we make this a continuous and improvised process.
Comments: CaSI can make through effective participation with academies, institutes and universities by getting the CSR & Sustainability as the core subject for research and consultancy. Also CaSI’s initiatives for establishing Student chapters will help in this regard
11. What is the business case for CSR? Is it the same in developed economies as in emerging markets? Would you please describe a specific environmental, social or governance issue from a business case for CSR perspective, comparing and contrasting the business case for CSR perspective of the specific issue in a developed economy and in an emerging market?
Comments: Although this mixed evidence might suggest that there is no a priori reason to develop a business case for CSR, there are growing calls for business to adopt a wider range of social and environmental responsibilities. Under a cost and risk reduction perspective of the CSR business case, the primary view is that the demands of stakeholders present potential threats to the viability of the organization, and that corporate economic interests are served by mitigating those threats through a threshold level of social or environmental performance. CSR initiatives are conceived strategically as conferring competitive advantage on the firm over industry rivals. Adaptive approaches to building a business case for CSR focus on building firm competitive advantage through strategically orienting and directing resources toward the perceived demands of stakeholders. Stakeholder demands are viewed less as constraints on the organization, and more as opportunities to be leveraged for the benefit of the firm. Business case built in Building a responsible brand is focused on exploiting CSR activities in order to build value through gains in firm reputation and legitimacy. Frames of inquiry associated with this view include: license to operate, social impact hypothesis, cause-related marketing, and socially responsible investing. These approaches are characterized by a focus on value creation by leveraging gains in reputation and legitimacy made through aligning stakeholder interests. Business case under the approach to creating value synergies include: positive synergy or ‘virtuous circle’, sustainable local enterprise networks, value-based networks, and societal learning. A focus underlying these approaches is the view that creating connections between stakeholders by relating common interests will open up heretofore unseen opportunities for multi-point value creation.
Emerging markets present both opportunities and risks for business. On the one hand, the almost 2 billion consumers in emerging markets represent a huge market opportunity for business. Indeed, the best way now to generate both profits and create societal value is to focus on emerging markets. On the other hand, MNCs operating in these countries face challenging and difficult security, environment, health, and other risks. Doing business in emerging markets will be difficult because many of them are characterized by either bad or weak public governance and administration, lack of public transparency, high levels of bribery and corruption, poor records on human rights, inadequate environmental, safety and labor standards and high levels of poverty and inequality. Many CSR efforts in the West, particularly those aiming to create universal standards or codes of conduct, have tried to cultivate a ‘level playing field’ in the world where the ‘rules of the game’ are the same for all companies. Asian capitalism, for example, can lead to different discourses of social responsibility from those in the West.
The Vodacom Group, of which Vodafone owns a 50% stake, is the largest cellular operators in South Africa. Since 1994, it has created a community phone service Programme in South Africa to meet the communication needs of the country. The advent of mobile technology in the mid-1990s offered an opportunity to extend massively national communication networks. But the costs were prohibitive for individuals from disadvantaged communities; hence the government was keen to encourage the private sector to identify systems for improving provision in disadvantaged areas. Vodacom responded to the regulatory demand by creating a Community Service Programme whose delivery team had a budget of R5 million (US$778,731). Research was carried out within communities in order to identify the best way forward in terms of providing the phone service. It was decided that access to phones could best be provided via phone shop franchises. In this way individuals from disadvantaged communities could be empowered as entrepreneurs while Vodacom’s management responsibilities were reduced. Working with Running Business Today as a partner, Vodacom provided the entrepreneurs with initial training and support. In this case the government has set quantifiable, ambitious but attainable social objectives which businesses can fulfill utilizing their management capacities. For Vodacom the Programme has simultaneously created public value and expanded its market.
12. Please describe a CSR activity you have been involved in.
Comments: During my stint with Aircel, we are involve with mitigating flood affected areas by introducing call plans at very lower rates for Aircel subscribers to other networks helping them to call their relatives, administration and other agencies for support. The calls made to Aircel network was made free too. Also we have placed Boat-on-demand to all Aircel subscribes for free wherever required in crisis during floods.
13. Please describe how your company or a company you are closely aware uses the concept of sustainable development to create better products or services.
Comments: There are many initiatives in favor of sustainable development. However, these initiatives are often scattered, sometimes not well known (in particular, there is little exchange between the public and private sectors), and not well promoted. These initiatives, which are rarely part of a long-term plan, are conducted by a wide variety of players: private and public-sector companies, associations, NGOs, territorial authorities, educational institutions, healthcare facilities, public bodies, etc. Legrand goal is not to downgrade user convenience, but to maintain the current level while saving energy. This goal has been achieved through the use of devices that consume little electricity and through the possible intelligent management of the equipment already in place. Equipment must have the best possible performance (low-energy lamps, insulation of buildings with electrical heating systems, economical household and professional appliances, etc.). They have made it to choose devices that can limit the subscribed power demand on the network (power controllers, programmers, etc.). Finally, we must work towards replacing mains electricity used for thermal applications (heating, hot water) with electricity obtained from renewable energy sources. Legrand contributes to the reduction of greenhouse gases through an in-house project known as “Legrand Climact”, which was launched in 2007 and is based around three fields of action: controlling energy on industrial sites, product eco-design and transportation. As a result of this initiative, significant reductions are made each year. Accordingly, between 2008 and 2009, Legrand reduced its CO2 emissions from the transport of finished products by 5%. In 2011, Legrand also began to formalize its carbon footprint according to the international Greenhouse Gases (GHG) protocol. This approach revealed that the most significant greenhouse gas emissions were related to raw materials, logistics, and the energy consumption of the Group’s manufacturing sites.
14. Any word of advice for Management Students….
Comments: I have advised students and professionals that to forge a career in CSR, they must first develop a sector expertise, a specific skill set and then decide which element of CSR they can fit into. Using “I want to work in CSR” is never a good starting point.