Noshir H Dadrawala (nos...@capindia.in) heads the Centre for Advancement of Philanthropy, Mumbai. Business & Community - The Story of Corporate Social Responsibility in India by Pushpa Sundar (New Delhi: Sage Response), 2013; pp 408, Rs 895. http://www.epw.in/book-reviews/story-csr-india.html There is a lot of excitement in India with the new Companies Act 2013, particularly its infamous Section 135 which makes corporate social responsibility (CSR) mandatory for companies meeting certain criteria of net-worth, turnover or net-profit. CSR however is not a new concept in India. Some companies like the Tata group have pioneered it long before even this term was coined. But the buzz around CSR continues unabated. There is still a lot of doubt and confusion in the mind of companies that have hitherto seldom been engaged in CSR. Therefore, Pushpa Sundar’s Business & Community – The Story of Corporate Social Responsibility in India with a foreword by Ratan Tata could not have been published at a more opportune time.
This book provides a unique historical perspective of corporate citizenship in India, tracing the course of business engagement with communities over a span of one and a half centuries. In a little under 400 pages this easy-to-read, jargon-free hardbound volume reiterates the need for businesses to earn public trust and details how best this can be done. Being Socially Responsible The book lays greater emphasis on “being socially responsible” rather than just “doing CSR” as most companies erroneously believe and practise. It urges companies to extend their imagination beyond chasing short-term personal financial gain to creating the most cost-efficient products and services harnessing the latest technology to meet the genuine needs of the largest section of society. According to the author, Business on its part needs the consent and cooperation of society as well as of government to operate effectively and to make profits. In the long term there is no hope for business without all-round and equitable development of society. Corporations need communities and vice versa. It is a social contract that is mutually beneficial (p 2). The author believes that Indian CSR has an organic evolution from within its own history and culture which sets it apart from that in the West. “Dynastic, rather than institutional, ownership still characterises Indian business” (p 11), she avers and adds that in contemporary times “the preference for keeping control over CSR activities has meant that companies prefer to operationalise their work internally through their own departments rather than through external agencies like non-profit organisations” (p 12). Today CSR is broadly defined as ethical behaviour of a company towards society. It means engaging directly with local communities, identifying their basic needs and integrating their needs with business goals and strategic intent. On the other hand, government perceives CSR as the business’s contribution to the nation’s sustainable goals. It is also about how business takes into account the economic, social and environmental impact of the way it operates. CSR is a vast canvas and while companies may choose philanthropy or contribute to society through partnerships to create shared value and support new ideas, the author is quick to remind us that “‘socially responsible and ethical behavior’ is a must” (p 48). The chapter on merchant communities belonging to various religions is quite interesting. While in the case of the Parsis, because of their greater westernisation, their philanthropic outlook was also more Western, the Chettiars are known for their systematic and methodical pursuit of wealth, facilitated by elaborate accounting procedures. Corporate Philanthropy The rise and growth of “corporate philanthropy” in India is vividly captured. Undoubtedly, the single-most important factor influencing business philanthropy in the pre-Independence period was the emergence in the 1920s of Mahatma Gandhi as a political and social leader. Though most businessmen of the time found it difficult to accept Gandhi’s theory of trusteeship fully and few became trustees to the extent he recommended, nevertheless, the theory influenced many including G D Birla, Jamnalal Bajaj and Lala Shri Ram. According to the book, the 1990s ushered in the contemporary phase of business-community engagement which we now refer to as CSR. This decade reaffirmed the need for business to be more responsible towards society and in broadening the concept of responsibility to include corporate philanthropy, sustainable wealth creation, good corporate governance, inclusive business practices, creating shared value and hybrid value creation and advocacy and action to achieve globally accepted goals in development. The Millennium Declaration at the United Nations Millennium Summit in September 2000 led to 190 countries signing the Millennium Development Goals (MDG), which ranged from halving global poverty and hunger to protecting the environment, improving health and sanitation and tackling illiteracy and discrimination against women. With the formulation of the MDGs, human rights and social justice concerns received greater attention and inclusive development became a goal of development. The MDGs have provided a framework and goals towards which to work, not only for governments, but also for corporations, and the targets set under the goals have become the benchmark for measuring progress or deficit. Also, C K Prahlad rejected the notion that only governments and non-governmental organisations (NGOs) can reduce poverty, and argued that business can do so too by providing goods cheaply and harnessing the entrepreneurial talent of the poor. As a result, many companies, especially consumer goods companies, started to target poor rural consumers in novel ways. Along with inclusive development, sustainable development – defined as one in which today’s needs should not compromise the ability of future generations to meet their needs – too became a new watchword. The book also takes the reader through the evolution of metrics and codes and standards such as SA 8000, International Organisation for Standardisation (ISO) standards and the United Nations Global Compact programme to promote nine principles covering three broad areas, namely, human rights, labour rights and sustainable development, including governance as the fourth area later on. India is looking up to “corporate India” for business leadership and clearly the more sensitive among the business leaders have themselves recognised that unless they do something to change the state of affairs, the resulting social tension and conflict would surely drag individuals and businesses into its vortex. Those involved with CSR today rightly believe it to be a catalyst for positive social change. The CSR model that is accepted emphasises two main principles: a company must do no harm through its processes and operations to people, but be responsible in every way to consumers, human resources and environment, i e, it must minimise its negative impact and optimise its positive one by engaging in initiatives to promote the progress of society. The author believes that since the 1990s, companies have begun to engage with the community in one of several ways: • Directly through company departments. • Through owned foundations. • Either partnering with NGOs for particular projects, or giving them outright grants to carry out certain activities. • Forming partnerships with government. • Philanthropy (donations on request to individuals or organisations; sponsorships; establishment of mega institutions for public causes; personal philanthropy of owners and leaders). According to a 2010 Associated Chambers of Commerce and Industry of India (ASSOCHAM) study, the top-five major theme areas for CSR initiatives were (in the order of priority and higher ranking) community welfare, education, environment, healthcare and rural development. The book also deals extensively with CSR challenges both generic and those from issues which have become sites of conflict. This book is not a compendium of good practices or a primer for CSR managers and practitioners. It is essentially a historical narrative written with an objective to enhance knowledge, understanding and appreciation of what business can contribute to society. It also identifies factors that either encourage or inhibit CSR. It is a work of deep insight and sound scholarship. Anyone reading it would not just emerge empowered with a wealth of knowledge but a sound understanding of CSR and its importance in doing business in the modern world. -- Avinash Shahi Doctoral student at Centre for Law and Governance JNU Clean India Campaign: Let us also chip in! 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