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Q1: Define CSR and list the key drivers of CSR and their impact on businesses.

 Ans: Corporate social responsibility (CSR) is a concept whereby organizations consider the interests of society by taking responsibility for the impact of their activitieson customers, suppliers, employees, shareholders, communities and other  stakeholders,as well as the environment. 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 thelocal community and society at large.

CSR is about how companies manage the business processes toproduce an overall positive impact on society.

CSR is a commitment to improve community well being throughdiscretionary business practices and contribution of corporateresources. Philip Kotler

CSR is about business giving back to society CSR is about capacity building for sustainable livelihoods. It respects

cultural differences and finds the business opportunities in buildingthe skills of employees, the community and the government.

Corporations may be influenced to adopt CSR practices by several drivers[20].

1. Ethical consumerism

The rise in popularity of  ethical consumerism over the last two decades can belinked to the rise of CSR. As global population increases, so does the pressure

on limited natural resources required to meet rising consumer demand.Industrialization in many developing countries is booming as a result of technology and globalization. Consumers are becoming more aware of theenvironmental and social implications of their day-to-day consumer decisions andare beginning to make purchasing decisions related to their environmental andethical concerns. However, this practice is far from consistent or universal.

2. Globalization and market forces

 As corporations pursue growth through globalization, they have encountered newchallenges that impose limits to their growth and potential profits. Government

regulations, tariffs, environmental restrictions and varying standards of whatconstitutes labour exploitation are problems that can cost organizations millionsof dollars. Some view ethical issues as simply a costly hindrance. Somecompanies use CSR methodologies as a strategic tactic to gain publicsupport for their presence in global markets, helping them sustain acompetitive advantage by using their social contributions to provide asubconscious level of advertising. Global competition places particular 

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pressure on multinational corporations to examine not only their own labour practices, but those of their entire supply chain, from a CSR perspective.

3. Social awareness and education

Shareholders and investors themselves, through socially responsible investing are exerting pressure on corporations to behave responsibly. Non-governmental organizations are also taking an increasing role, leveraging the power of themedia and the Internet to increase their scrutiny and collective activism aroundcorporate behaviour. Through education and dialogue, the development of community in holding businesses responsible for their actions is growing.

4. Ethics training

The rise of ethics training inside corporations, some of it required by governmentregulation, is another driver credited with changing the behaviour and culture of 

corporations. The aim of such training is to help employees make ethicaldecisions when the answers are unclear. The most direct benefit is reducing thelikelihood of "dirty hands", fines and damaged reputations for breaching laws or moral norms. Organizations also see secondary benefit in increasing employeeloyalty and pride in the organization. Caterpillar  and Best Buy are examples of organizations that have taken such steps.

Increasingly, companies are becoming interested in processes that can addvisibility to their CSR policies and activities. One method that is gainingincreasing popularity is the use of well-grounded training programs, where CSRis a major issue, and business simulations can play a part in this.

5. Laws and regulation

 Another driver of CSR is the role of independent mediators, particularly thegovernment, in ensuring that corporations are prevented from harming thebroader social good, including people and the environment. CSR critics such asRobert Reich argue that governments should set the agenda for socialresponsibility by the way of laws and regulation that will allow businesses toconduct themselves responsibly.

6. Crises and their consequences

Often it takes a crisis to precipitate attention to CSR. One of the most activestands against environmental management is the CERES Principles that resultedafter the Exxon Valdez incident in Alaska in 1989. Other examples include thelead poisoning paint used by toy giant Mattel, which required a recall of millionsof toys globally and caused the company to initiate new risk management andquality control processes. In another example, Magellan Metals in the West

 Australian town of Esperance was responsible for lead contamination killing

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thousands of birds in the area. The company had to cease business immediatelyand work with independent regulatory bodies to execute a cleanup.

Q2: Why CSR, what is the relevance of CSR in organisational values mission and

vision. Please identify the key stake holders and issues involved in CSR.

 Ans: In most cases the customers not only demand but also expect leading brands and

companies to actively take part in CSR activities. Consumers prefer socially and

environmentally responsible companies. We must realize that there are definite social

and environmental costs of most commercial activities. It is only fair that companies

return some of their profits to help reverse any damages they have caused.

Governments cannot do this job all alone. Corporations have better resources and better 

management skills to help in such actions and they must do their part. In most cases

having some kind of a CSR program is a requirement of the government or regulatory

authority.

Interestingly, it has been observed that companies that are more socially responsible

also do better financially. If you look at any list of most successful companies, you will

find that they also have substantial CSR programs. Consumers prefer buying from such

companies. Governments help them by decreasing taxes and easing regulations. A

company that invests in its surroundings has more credibility. Such companies are also

able to attract and retain the best employees because people want to work in companies

that reflect the same values as them.

 Y CSR:

1. Changed Public Expectations of Business:

Public expectations from business have changed. It is reasoned that the institution of 

business exists only because it satisfies the valuable need of the society. Society gave

business its charter to exist, and the charter can be amended or revoked at any time that

business fails to live up to society’s expectations. Therefore, if business wishes to

remain viable in the long run, it must respond to society’s needs and give society what it

wants.

2. Public Image:

 Another argument in favour of social responsibility is that it improves public image. Each

individual firm seeks an enhanced public image so that it may gain more customers,

better employees more responsive money market and other benefits. A firm which seeks

better public image should support social goal.

3. Avoidance of Government Regulation:

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It seeks to regulate business in the public interest. Government regulation is costly and

denies the much needed freedom in decision-making. Before government stretches its

long arms, business should discharge its obligation to society.

4. Business has the Resources:

Another argument for social responsibility is that business has a vast pool of 

resources in terms of men, talents, fictional expertise and money. Probably, business is

without peers in respect of the resources it possesses. With these resources at its

command, business is in a better position to work for social goals

5. Prevention is Better then Cure:

If business delays dealing with social problems now, it may find itself constantly

occupied with putting out social fires so that it has no time to accomplish its goal of 

producing goods and services. Since these social problems have to be dealt some time,it is actually more economical to deal with them before they develop into serious social

breakdowns that consume management time.

6. Citizenship argument:

If individual members of society have an obligation to improve society, corporations also

have this responsibility. After all, corporations unlike citizens are created by the society.

Corporations are citizens and citizens have civic duties and responsibilities. The

proponents of social responsibility say that the old concept of profit maximization has

vanished and even economists have accepted it. They have substituted profit

maximization with satisfactory profit. Today, business decision – making is a mixture of altruism, self interest and good citizenship. Managers do take actions, which are in the

social interest even though there is a cost involved and the connection with the long-

range profit is quite remote.

Purpose, Value & VisionValues & Vision help to bring together the people in the organisation andget them working towards a common aim. This can motivate employeesmore powerfully than other incentives, such as pay and perks.

Companies which were consistently clear about their purpose andvalues, and more importantly lived by them, outperformed the US stock

market average by fifteen times.PepsiCo’s business is based on its sustainable vision of making tomorrow better 

than today. PepsiCo’s commitment to living by this vision every day is

visible in its contribution to the country, consumers and farmers.

Purpose, Value and Vision….. What is the Company for?

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What do we stand for?

What is our vision? Process - developed co-operatively? Statement - Journey of continuous improvement? Usage - Helps set business goals?

 Applicability - Able to measure & report business performance?

Social Responsibilityrequires the identification of various interest groups, whichmay affect the functioning of abusiness organization and mayalso be affected by itsfunctioning. Normally variousgroups associated with a

business organization areshareholders, workers,customers, creditors, suppliers,government and society ingeneral. The managementowes responsibility towards allthese groups. Therefore,management should show astandardized norm of behavior.

Shareholders:

The first responsibility of the management is to protect the interestof shareholders. The interests of majority of shareholders and largeminority of shareholders are generally well protected through either directparticipation in the management actions or they have real power tointervene, if necessary. They should be informed about the functioning of the organization adequately and timely.

Therefore, management has a responsibility to provide proper safeguard to the money invested by shareholders.

Workers:Workers have direct interest in an organization because by working

there, they satisfy their needs. Thus, it is the management’s responsibilityto protect the interest of workers in the organization. This can be done bythe management in the following ways:

- Management should treat workers as another wheel of thecart

- Management should develop administrative process in sucha way that promotes cooperative endeavor between employers andemployees.

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- The management should adopt a progressive labor policybased on recognition of genuine trade union rights – participation of workers in management, creating a sense of belongingness, improvingtheir living and working conditions.

- Management should pay fair and reasonable wages and

other financial benefits to workers.

Customers:Management owes a primary obligation to give a fair deal to the

customers. This can be done in the following ways:- Customers should be charged a fair and reasonable price.- The supply of goods and services should be of uniform

standard and of reasonable quality.- Management should not indulge in profiteering, hoarding, or 

creating artificial scarcity.- Management should not mislead the customers by false,

misleading and exaggerated advertisements.

Creditors, Suppliers and Others:They affect the organization in various ways. Therefore, the management

is responsible to fulfill its obligations towards them. This can be done in thefollowing ways.

- Management should create healthy and cooperative inter business relationship between different businesses.

- Management should provide accurate and relevantinformation to creditors and suppliers.

- Payments of price of materials, interest on borrowings, other 

charges should be prompt.

Government:It is very closely related with the business system of the country. It

provides various facilities for the development of business. Government,no doubt, exercises control over business, but these controls are meantfor overall development of business. Management can discharge itsobligation to government by:

- Management should be a law-abiding citizen- Management should pay taxes and other dues fully, timely &

honestly.

- It should not corrupt government workers and publicservants and the democratic process- It should not buy political favors by any means

Society:Organizations exist within a social system and get facilities from the

system. Therefore, they owe obligations to the society as a whole. Thiscan be done by:

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- Management should maintain fair business policies andpractices.

- It should play a proper role in civic affairs.- It should provide and promote general amenities and help in

creating better living conditions in general.

CSR- Some Global Concerns Defining the issue – some confusion Partnership dilemmas Challenges for government Not reduced to high visibility projects Implementation as an integrated process not activity CSR to be linked with sustainable development Whether CSR should be mandatory and CSR reporting

standardised Supply chain responsibility

CSR in India – Some concerns Lack of conviction of the necessity of CSR in Corporates Lack of partnership approach between Corporates &

NGOs

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Lack of interest in Non Financial Expertise fromCorporates by NGOs

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Q3: In PPP lies the future of CSR. Build a convincing business case in favour of such partnerships explaining why and how their success is possible???

 Ans: Public-private partnership (PPP) describes a government service or private business venture which is funded and operated through a partnership of government and one or more private sector   companies. These schemes aresometimes referred to as PPP or P3.

In some types of PPP, the government uses tax revenue to provide capital for investment. Government contributions to a PPP may also be in kind (notably thetransfer of existing assets). In projects that are aimed at creating public goods like in the infrastructure sector, the government may provide a capital subsidy inthe form of a one-time grant, so as to make it more attractive to the privateinvestors. In some other cases, the government may support the project byproviding revenue subsidies, including tax breaks or by providing guaranteed annual revenues for a fixed period.

PPP begins when an organization decides to take on the catalyst role and bringpublic and private organizations together to tackle a specific social problem. Thecatalyst’s investment makes it possible for public and private organizations to joinforces and apply their strengths to achieve specific health goals. This investmentmay be relatively modest, but it unleashes considerable energy and commitment.PPP is a practical option that uses existing resources to address health andsocial problems.

Public-private partnerships (PPP) can achieve positive results for the public and at thesame time meet the individual organizational goals of the partners. Such partnershipsallow considerable leveraging of each partner’s resources and unique strengths, and

results are often attained in less time, at lower cost, and with greater sustainability thanefforts by any single partner.

Partnership Impact

Work with corporate instead of against them. Corporate have turned into key resources for their partners. Inherent strengths of leadership, financial and organisational skills as well as

pool of trained individuals, market access and experience on the table. Equal commitment speeds up delivery time and performance. Win – Win situation.

• The Global Fund to Fight AIDS, Tuberculosis & Malaria, a Geneva basedUN connected organisation, established in 2002 to dramatically upscaleglobal financing of interventions against the three pandemics.

• The TB Alliance is financed by public agencies and private foundations,and partners with research institutes and private pharmaceuticalcompanies to develop faster-acting, novel treatments for Tuberculosis thatare affordable and accessible to the developing world.

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• The International AIDS Vaccine Initiative (IAVI), a biomedical public-

private product development partnership (PDP), was established in 1996to accelerate the development of a vaccine to prevent HIV infection and

 AIDS. IAVI is financially supported by governments, multilateralorganizations, and major private sector institutions and individuals.

• Public Private Partnerships for Disaster Management, brings together thePrivate sector for PPP models with a tool box of partnership opportunitiestowards Resilient & Sustainability Goals

Q4: Businesses need to focus and report on Triple Bottom Line, briefly explain therequirements of Global Reporting Initiative(GRI)??

 Ans:

Green business - the triple bottom line

The phrase was coined by John Elkington in 1994

Sometimes referred to as "TBL", "3BL; triple bottom line simply stands for 

PeoplePlanetProfit

Triple Bottom Line reporting is becoming an accepted way for businesses to

demonstrate they have strategies for sustainable growth. The triple bottom line isa form of reporting that takes into account the impact your business has in termsof social and environmental values along with financial returns.

Whereas traditional models were all about profit, profit and more profit; triplebottom line accounting recognizes that without happy, healthy people to staff abusiness and the natural environment able to sustain those people and supplyresources for trade; business is, well, simply unsustainable in the long run.

People

This is also known as Human Capital. It really just means treating your employees right, but furthermore also the community where your businessoperates. In this part of the Triple Bottom Line model, business not only ensuresa fair day's work for a fair day's pay; but also ploughs back some of its gains intothe surrounding community through sponsorships, donation or projects that gotowards the common good. TBL business would not use child labour, would payfair salaries to its workers, would maintain a safe work environment and tolerableworking hours, and would not exploit a community or its labour force. A TBL

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business also typically seeks to "give back" by contributing to the strength andgrowth of its community with such things as health care and education. TheGlobal Reporting Initiative (GRI) has developed guidelines to enable corporationsand NGO's alike to comparably report on the social impact of a business.

Planet

This is Natural Capital. A business will strive to minimize its ecological impact inall areas - from sourcing raw materials, to production processes, to shipping andadministration. It's a "cradle to grave" approach and in some cases "cradle tocradle" i.e. taking some responsibility for goods after they've been sold - for example, offering a recycling or takeback program. A TBL endeavour reduces itsecological footprint by, among other things, carefully managing its consumptionof energy and non-renewables and reducing manufacturing waste as well asrendering waste less toxic before disposing of it in a safe and legal manner. Atriple bottom line company does not produce harmful or destructive products

such as weapons, toxic chemicals or batteries containing dangerous heavymetals for example. A number of respected reporting institutes and registriesexist including the Global Reporting Initiative, CERES, Institute 4 Sustainabilityand others.

Profit

This is more about making a honest profit than raking a profit at any cost - it mustbe made in harmony with the other two principles of People and Planet.

While many major corporations used to sneer at the idea of a Triple Bottom Line

reporting system; some have taken the bull by the horns; with a positive flow oneffect to their suppliers. Because supply chains are also accountable to theoverall impact of a company, they also come under scrutiny in the triple bottomline audits. A good example of this is some big box stores "greening" up their actand in doing so, demanding that their suppliers use less packaging or banningcertain ingredients from products.

The Global Reporting Initiative (GRI) produces the world’s de facto standard insustainability reporting guidelines. Sustainability reporting is the action where an

organization publicly communicates its economic, environmental, and social

 performance. The GRI’s mission is to make sustainability reporting by all organizations

as routine and comparable as financial reporting. The GRI Guidelines are the mostcommon framework used in the world for reporting. More than 1000 organizations from

60 countries use the Guidelines to produce their sustainability reports. (View the world’s

reporters at the GRI Reports database). All sorts of organizations report using the GRIGuidelines, such as corporate businesses, public agencies, smaller enterprises,  NGOs,

industry groups and others.

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Reporting on sustainability performance is an important way for organizations to manage

their impact on sustainable development. The challenges of sustainable development are

many, and it is widely accepted that organizations have not only a responsibility but alsoa great ability to exert positive change on the state of the world’s economy, and

environmental and social conditions.

The “GRI” refers to the global network of many thousands worldwide that create the

Reporting Framework, use it in disclosing their sustainability performance, demand itsuse by organizations as the basis for information disclosure, or are actively engaged in

improving the standard.

The network is supported by an institutional side of the GRI, which is made up of the

following governance bodies: Board of Directors, Stakeholder Council, TechnicalAdvisory Committee, Organizational Stakeholders, and a Secretariat. Diverse geographic

and sector constituencies are represented in these governance bodies. The GRI

headquarters and Secretariat is in Amsterdam, The Netherlands.

 The GRI Guidelines are the most common framework used in the world for

reporting.

Common framework for sustainability reporting similar to GAAP for financial

reporting

Enhance reporting features

Credibility

Consistency

Comparability

Simplifies report preparation and assessment

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Reporting - How to go about it 

Identify and prioritize the key audiences for theircommunications

Decide on the key messages Establish the appropriate communications channels for the

target audience Give all relevant contacts for people involved in programs Report on the impact achievements of their social

responsibility in business or CSR program, short & long term Over time, ensure communications develop as a two-way

dialogue with key stakeholders with a real flow of information and ideas running both ways.

Q5: CSR leads to sustainable business advantage, justify giving advantages thatyou think accrue to a socially responsible business.

 Ans: The scale and nature of the benefits of CSR for an organization can varydepending on the nature of the enterprise, and are difficult to quantify, thoughthere is a large body of literature exhorting business to adopt measures beyondfinancial ones.

The business case for CSR within a company will likely rest on one or more of these arguments:

Human resources

 A CSR programme can be seen as an aid to recruitment and retention,particularly within the competitive graduate student market. Potential recruitsoften ask about a firm's CSR policy during an interview, and having acomprehensive policy can give an advantage. CSR can also help to improve theperception of a company among its staff, particularly when staff can becomeinvolved through payroll giving, fundraising activities or community volunteering.

Risk management

Managing risk is a central part of many corporate strategies. Reputations thattake decades to build up can be ruined in hours through incidents such ascorruption scandals or environmental accidents. These events can also drawunwanted attention from regulators, courts, governments and media. Building agenuine culture of 'doing the right thing' within a corporation can offset theserisks

Brand differentiation

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In crowded marketplaces, companies strive for a unique selling proposition whichcan separate them from the competition in the minds of consumers. CSR canplay a role in building customer loyalty based on distinctive ethical values.Several major  brands, such as The Co-operative Group, The Body Shop and

 American Apparel are built on ethical values. Business service organizations can

benefit too from building a reputation for integrity and best practice.

License to operate

Corporations are keen to avoid interference in their business through taxation or regulations. By taking substantive voluntary steps, they can persuadegovernments and the wider public that they are taking issues such as health and safety, diversity or the environment seriously, and so avoid intervention. This alsoapplies to firms seeking to justify eye-catching profits and high levels of boardroom pay. Those operating away from their home country can make surethey stay welcome by being good corporate citizens with respect to labour 

standards and impacts on the environment.

CSR – Business Advantage

Increased sales & market share Reduce cost, risks, liabilities, litigation cost  Access to large talent pool – corporate & brand reputation advantage Better employee retention – reduced cost of training  Availability of growing pool of international capital Customer satisfaction, loyalty, advocacy Improved Corporate Image

Improved stakeholder value Sustainable development Status of preferred supplier / partner  Environmental sustainability Newer markets / opportunities Stakeholder support in times of crisis Competitive mileage

Q6: Please explain how are Indian and Multinational companies framing their response to CSR by way of initiatives in the area of Climate Change,Alternative Energy sources, Energy efficiency and conservation.

Ans: In India, Vedic period (daan -  Merchant charity) -Scriptures advocatepeople and environment friendly codes of conduct. Traditionally an ecofriendly society is conscious of eco systems and its equilibrium.

Environment

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•   Alternative Energy Sources• Climate Change• Energy Efficiency and Conservation• "Forest Friendly" Practices• Green Building or Product Design

• Recycling Efforts• Sustainable Business Practices• Water Conservation and Quality

Indicator - Environment

Overall energy consumption Water usage Quantity of solid waste produced by weight/volume Upheld cases of prosecution for environmental offences (CO2/greenhouse

gas emissions)

Other emissions (eg Ozone, Radiation, SOx, NOx etc) Use of recycled material Percentage of waste recycled Net CO2 contribution made Environmental impact over the supply chain Environmental impact, benefits or costs, of companies core products and

services Positive and negative media comments for environmental activities

 A committed separate department monitors the Environment Pollution Controland Effluent Treatment facilities, re-cycling of effluents and control of stack

emissions. M&M has been the recipient of the prestigious International Award‘Oscar of the Safety World ’ – the “Sword of Honour ” from the British SafetyCouncil, London in 1993. The Award is presented to 30 best/safest companiesin the world over.