Until the nineties the concept of Corporate Social Responsibility was totally centred around charity or philanthropy, which was practised by large business houses like the Tatas, Birlas and large public sector units, to fund identified social causes. This was often done to improve the lot of industrial workers or people in the geographical area in which a company or an industry operated. Post-liberalisation it moved towards a more participatory model. Now, the recent decision by the Central government to make CSR mandatory has ensured that a formal stakeholders’ model will develop over time - in which the corporates, their employees, communities and even the local government are seen as the stakeholders. This move is also a realisation of the fact that corporates should not only feel responsible for their financial bottom lines, but also their ‘social performance’ – being watched keenly by discerning consumers and various stakeholders. As business in India responds to these expectations, it marks a not insignificant shift from Milton Friedman's advice - that 'there is only one social responsibility of business and that is to increase profits'.
In Gurgaon, which is a corporate hub of the country, the decision to make CSR compulsory is being interpreted in different ways, and the majority believes that this is a learning phase for many of the stakeholders. Although everyone is in agreement that there is a cryiing need to augment the developmental activities across societies and cities, they also are looking for some ‘clarity’. Vikram Singh Verma, CEO of Smile Foundation, who has been involved in CSR activities for the last several years, opines that the move by the government is advantageous for the social sector. It will bring more funding and involvement from a large number of organisations that would now be operating under a changed frame of reference. "At present it is too early to talk about the impact as corporates have to get their act together. The companies need to align their business with CSR objectives and goals. This will help them have a clearer idea of how they would like to socially contribute," says Verma. What development sector experts suggest is that the corporates, while formulating their strategies, must focus on long-term goals and realise that the development sector deals mainly with people issues. The problems faced by Indian society are chronic and can’t be resolved through just short-term measures. An undue focus on numbers, and quarterly targets and impact assessments may not be the best way to go. Verma adds that the quality of intervention is critical. In Gurgaon, he says, major interventions are needed to help the migrant labour, their children and families; they are in a huge number in the City. "Unless these families are helped, their children educated, and all of them given a chance to rise from the bottom of the pyramid, it would be difficult to stop the ever-increasing gulf between the haves and have-nots," he avers. Damyanti Bhowmik, Operations Head of the Gurgaon-based SNS Foundation, which is run by auto ancillary major Anand Group, states that CSR does not mean spending 2 per cent of the profits on some charity; CSR spend entails that an organisation has to become socially responsible in totality. "We have to make our Company more responsible to its employees, to the environment, business, customers and to the community as a whole. There is also need for being both morally and ethically responsible," says Bhowmik. In her opinion the corporates will also need to develop strategic CSR plans, just like the business plans, and monitor their execution in a proper manner. The SNS Foundation, which she heads, has developed two identities: one is that of a CSR arm of the Anand Group, and the other is of an organisation that works with other corporates to execute their social and development plans. "We have developed sustainable and scalable programmes for community interventions in health, education and skill development, which can be replicated across the country, depending on funding levels," she informs. An important point that she makes is that corporates should work with established NGOs as their partners, as this would make delivery easier and more certain; it is better than trying to set up projects on your own, for which some special skills and infrastructure would be required. Viraj Chauhan, Exectuive Director, MTS India, says that their company has been working with NGOs to implement their CSR objectives. "Although MTS is not making any profits in India we are still spending a substantial amount on health and education because we are a responsible company. For us CSR is about understanding the business' impact on the wider world and considering how a company can use this impact in a positive manner. It means taking a responsible attitude, going beyond the minimum legal requirements and following straightforward principles that apply irrespective of the size of the business," says Chauhan. Being a telecom company, MTS is using its strength to help children in schools, facilitating polio vaccinations and contributing to the Global Food network - which aims at preventing hunger among the poor. In a pioneering initiative, the Company partnered with the government and organised awareness drives in several Indian states - including Delhi and Haryana - to remind people about the need to get their children vaccinated against polio. MTS sends out about 10 million SMSs to its customers across the locations where the drives are going to be conducted. In addition the Company also arranges publicity material and assists in the setting up of polio booths. Chauhan says that MTS has been lauded for its consistent support to the IUEPN program, by Aid Matrix as well as UNICEF. Organisations like Maruti, SRF, DLF and some others are also helping to improve the social and community parameters in Gurgaon and NCR. SRF Foundation works on an inclusive approach to bring about development, by involving local communities and their representatives. The Foundation has set up a number of schools in Mewat by adopting the cluster approach, with the goal of quality education for all. Bhavna Sood, Vice President, Corporate Communications, DS Group, tells Friday Gurgaon that the government move to make CSR mandatory will ensure that it gets more structured. Earlier it was the CSR department alone, but now the entire management and Board of a company are equal stakeholders in executing their social responsibility. "Things would now be more streamlined and actions would be faster, as even in private companies the decision making has been slow for this kind of work,” says Sood. Her own organisation runs sustainable initiatives in health and education across the NCR, to help the poor and weaker sections of society. Regular mobile health clinics are run by the DS Group in urban slums and villages.
Discussions and plans on CSR are normally centred around the corporates, and NGOs, who are a major stakeholder in this programme, are often not given adequate attention. It is the NGOs who, as development partners, mostly execute the CSR activities of the companies. There are only a few organisations, mainly large Public Sector Undertaking (PSUs), who have separate departments for this ‘function’. However, the CSR responsibility being outsourced to NGOs is not necessarily a smooth operation. While most NGOs are good in their work and mean well, there is often a lack of transparency and accountability, as also a mismatch of expectations. Vikram Verma of Smile Foundation adds that with more funding coming into the CSR area, the NGOs will have to change their work culture and understand corporate working in a better way. "NGOs need to be more responsible, develop better capacities to deliver, manage accounts better and consider the MoUs sacrosanct," he says. In addition there is need to develop quality talent and better leadership, says Verma, predicting that this ‘sector’ will witness a major transformation in the years to come. The focus is now more on community participation and new ways to meet the needs of the community groups. A liquor company in Gurgaon recently launched Traffic Tau, an innovative idea, in association with Gurgaon Police, to make people aware about the problems of drunken driving (and preventing people from doing it). A major pharma company in India decided to sell a cocktail of anti-HIV drugs at a fraction of its cost, which led to a significant decrease in the price of these drugs in the world markets. Maruti Suzuki, an auto industry leader based in Gurgaon, works with local communities around its plants in Gurgaon, Manesar and Rohtak, to help improve the lives of the weaker sections of society, and also to safeguard the environment. There is no separate CSR organisation in Maruti, but these activities are built into the DNA of the Company, and they have separate divisions for working with local communities, skill development and road safety training. Till now Maruti Driving Schools have trained around 1.5 million people. More Schools are being opened regularly.
While corporates and NGOs are bracing for the change, social activists in Gurgaon say that the government should also open up and get ready to take help from the corporate expertise and funding. Latika Thukral of I Am Gurgaon says that projects like Bio-diversity Park happened because officials were open to do so in collaboration with private partners. "There is however a need to form a ‘system’, because such long terms projects cannot depend on the whims and fancies of an official. The government must create a system, and also identify projects like greenery, afforestation and saving of village ponds, to be given to corporates and NGOs as their responsibility," says Thukral. Her own organisation works with private companies by involving all the stakeholders - which ensures that there is a long-term interest in the CSR work and there is a shared responsibility as well. The need for integrating social responsibility into business practices is also being felt among the Indian corporates. Damyanti Bhowmik of SNS Foundation says that there is need for greater evaluation and transparency norms both for business and social initiatives. Others opine that projects should be genuine and serve the society, and should not be guided by profit, or undertaken to influence a certain section or community, or taken up for currying favour with some individual in government or the bureaucracy. A paradigm shift in the CSR is also taking place because corporates now realise the importance of building their 'reputation capital' - which is becoming very helpful in winning and sustaining new markets and businesses globally. In such a scenario, CSR could soon be a core business strategy, which may help in reducing risks while ensuring long-term profits through the co-option of all the stakeholders. In Gurgaon, CSR could play an important role in taking care of some glaring deficiencies in the civic and social facilities and services, and in ensuring basic care for the underprivileged – helping ‘rebuild’ the City in some manner. The need is for corporate leaders to have a social vision and similar-minded social partners to help them achieve their societal goals.
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