Meds-052 CSR Process

MEDS-052
CSR PROCESS
Indira Gandhi National Open University
School of Extension and Development Studies
BLOCK 1 OPERATIONALIZING CSR 5

Unit 1 Structural and Functional Setup 7
Unit 2 Business Strategy in CSR 28
Unit 3 Corporate Governance and Business Ethics 43
BLOCK 2 CSR CULTURE AND DIVERSITY 57
Unit 1 Employer Perspective 59
Unit 2 Employee Engagement 75
Unit 3 Entrepreneurship and Welfare 87
Unit 4 Rehabilitation and Resettlement 101
BLOCK 3 STAKEHOLDERS’ ENGAGEMENT 115
Unit 1 Stakeholders 117
Unit 2 NGOs and Cooperatives 136
Unit 3 CSR and Government Programmes 149
Unit 4 Corporate Foundations 165
Unit 5 Local Bodies 185
BLOCK 4 CSR FOR SUSTAINABLE DEVELOPMENT 199
Unit 1 UN SDGs 201
Unit 2 Selection of Goals and Indicators 236
Unit 3 Implementation Plan and Focus Area Alignment 252
Unit 4 Collective Action and Collaboration 274
PROGRAMME DESIGN COMMITTEE
Prof. Anil Kumar Sharma Prof. Kotaru Ravi Sankar
Associate Professor (IIT, Roorkee) SOMS, IGNOU, New Delhi
Roorkee Prof. G Subbayamma
Mr. Ashok B. Chakraborty SOMS, IGNOU, New Delhi
Chief Sustainability Officer Dr. Leena Singh
NFCSR, Indian Institute of SOMS, IGNOU, New Delhi
Corporate Affairs (IICA),
Prof. B. K. Pattanaik
Gurugram
SOEDS, IGNOU, New Delhi
Mr. Ravi Puranik
Prof. Nehal A. Farooquee
CEO, Hindustan Unilever Foundation
Mumbai
Dr. Pradeep Kumar
Dr. Debasis Bhattacharya
Institute of CSR & Management
Delhi, Narela, Delhi Dr. Grace Don Nemching
Dr. Mahesh Chander
Principal Scientist & Head Prof. P.V.K. Sasidhar
Division of Extension Education IVRI SOEDS, IGNOU, New Delhi
Bareilly (Programme Coordinator)
Mr. Ashwini Kumar Dr. Nisha Varghese
Ex General Manager (I / c) SOEDS, IGNOU, New Delhi
HSE & CSR - BHEl, Noida (Programme Coordinator)
Mr. Parul Soni
Thinkthrough Consulting Private Limited
Vasant Vihar, New Delhi
COURSE PREPARATION TEAM
Unit Writing:
Dr. Debasis Bhattacharya, ICSRM, Delhi and Dr. Vandana Bhattacharya, NIHFW, New Delhi (Units 1,2,3;
Block 1)
Dr. Alka Chaturvedi, Kalindi College, DU (Unit 1,2; Block 2)
Dr. Grace Don Nemching, IGNOU (Unit 3; Block 2 and Unit 2; Block 3)
Mr. Dinesh Agrawal, Former GM, NTPC (Unit 4; Block 2)
Dr. Rajeshwari Narendran, Head, Department of Business Administration, MLSU, Udaipur Rajasthan (Units
1,4; Block 3)
Ms. Niti Saxena, Sehgal Foundation (Unit 3; Block 3)
Dr. Deeksha Dave, IGNOU (Unit 5; Block 3)
Mr. Ashok Chakraborty, Former Chief Sustainability Officer, NFCSR, IICA, Gurugram, Haryana
(Units 1,2,3,4; Block 4)
Format Editing: Content Editing:

Dr. Nisha Varghese, SOEDS, Dr. Manoj K. Dash, Former Head, CSR
IGNOU, New Delhi Odisha Power Generation Corporation Ltd.;
LanguageEditing Dr. Nisha Varghese, SOEDS, IGNOU
Mr. Praveer Shukla, New Delhi Prof. P.V.K. Sasidhar, SOEDS, IGNOU
Programme Coordinators : Dr. Nisha Varghese <nishavarghese@ignou.ac.in>

Prof.P.V.K.Sasidhar<pvksasidhar@ignou.ac.in>
Course Coordinator : Dr. Nisha Varghese <nishavarghese@ignou.ac.in>
PRINT PRODUCTION
Mr. Y.N. Sharma
Assistant Registrar, MPDD, IGNOU, New Delhi
June, 2021
© Indira Gandhi National Open University, 2021
ISBN:
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MEDS-052 CSR PROCESS
Dear Learner,
Welcome to the course, MEDS – 052 on ‘CSR Process’. After reading about the
‘Fundamentals of CSR’ in MEDS – 051, by now you have a fairly good
understanding of the concept of CSR, its local and global perspectives, the various
legislations that govern the CSR activities in India and in other countries, and
the various thematic areas in which the CSR activities can be undertaken. In this
course, we move a step forward and learn how CSR is operationalized, what the
CSR culture is, who the stakeholders are and how best can they be involved in
promoting CSR in its right spirit. In this course we also learn how CSR is aligned
with sustainable development.
Course Structure
This course has four blocks. The content covered under each of these blocks is
as follows:
BLOCK 1 BLOCK 2 BLOCK 3 BLOCK 4

Operationalizing CSR Culture Stakeholder CSR for
CSR and Diversity Engagement Sustainable
Development
Structural and Employer Stakeholders UN-SDG

Functional Setup Perspective
NGOs and
Employee Cooperatives Selection of
Engagement Goals and
Business CSR and Indicators
Strategy in Government
CSR Entrepreneurship Programmes Implementation
and Welfare Plan and Focus
Corporate Area Alignment
Governance Foundations
and Corporate Rehabilitation Collective Action
Ethics and Resettlement and
Local Bodies
Collaboration
Course Objectives
To understand the CSR process in terms of the structural and functional
setup, strategic planning for CSR, aligning business strategy with CSR
interlinking CSR with corporate ethics and corporate governance.
To understand CSR culture of welfare and social inclusion, employee
engagement in CSR and the CSR perspective from employer’s point of view.
To identify the various stakeholders in CSR and to know how to fruitfully
engage with them.
To be able to advocate for sustainable development through CSR.
Learning Outcomes
After successful completion of this course, the learners are expected to be able
to:
Explain in detail the steps involved in strategic planning in CSR
List various strategies for employee engagement in CSR
Describe how to prioritize stakeholders in accordance with their expectations
and relevance to the organization
Interlink (Sustainable Development Goals SDGs) with CSR projects and
align the goals with corporate core strategies
For your convenience and easy handling, the SLM under MEDS-052 is presented
in two volumes with two blocks each. Both the volumes are connected in such a
way that after completing all 16 units, you will gain better knowledge and
understanding of CSR Process.
Block 1, Operationalizing CSR with three units deals with the structural and
functional set up, business strategy in CSR and governance and corporate ethics.
Block 2, CSR Culture and Diversity with four units discusses the employer
perspective of CSR and employee engagement and also issues related to welfare,
rehabilitation and resettlement.
Block 3, Stakeholder Engagement with five units discusses comprehensively

the identification of stakeholders and engagement with NGOs and co-operatives,
government, corporate foundations and local bodies.
Block 4, CSR for Sustainable Development with four units deals with various
UN SDGs, indicators for each of the SDGs, implementation plan, alignment
with the focus area, collective action and collaboration.
MEDS-052
CSR PROCESS
Block
1
OPERATIONALIZING CSR
UNIT 1
Structural and Functional Setup
UNIT 2
Business Strategy in CSR
UNIT 3
Corporate Governance and Business Ethics
Operationalizing CSR
BLOCK 1 OPERATIONALIZING CSR
Block 1: Operationalizing CSR consists of three units.
Unit 1: Structural and Functional Setup discusses the structure of CSR

committee and board. It also discusses CSR policy and its objectives. It discusses
in detail the steps involved in strategic planning in CSR.
Unit 2: Business Strategy in CSR deals with the concept of business strategy,
the importance of a good business strategy and steps needed to achieve sustainable
corporate strategy. It also discusses the sustainability risks and challenges for
the corporate.
Unit 3: Corporate Governance and Business Ethics discusses the concept of

corporate governance and the elements of good corporate governance. It also
discusses business ethics, the importance of corporate ethics and approaches to
ethical decision making.
6
Structural and Functional
UNIT 1 STRUCTURAL AND FUNCTIONAL Setup
SETUP
Structure
1.1 Introduction
1.2 Policy Formulation and Organizational Setup
1.3 Methodology of CSR
1.4 CSR Thematic Areas/Activities
1.5 CSR: Strategic Planning
1.6 Let Us Sum Up
1.7 Keywords
1.8 Bibliography and Selected Readings
1.9 Check Your Progress – Possible Answers
1.1 INTRODUCTION
The practice of CSR is not new to companies in India. However, what the
Companies Act 2013 has done is bring more companies into the fold of CSR.
Also, it is likely that the total CSR spends will increase. What is clear to many
Companies is that if this increased spending is to achieve results on the ground,
which is one of the core intents of the Act, then it is needed to be done strategically,
systematically and thoughtfully. It is in this context that the present unit envisages
equipping you for this shift towards structured engagement with communities. It
suggests steps to develop a CSR strategy and policy, and identifies the key building
blocks for initiating and developing the CSR programmes. It takes the CSR
practitioner through some of the key choices that may be required to be made
while pursuing CSR objectives and help develop internal capabilities in an
organization that is socially sensitive and responsible. A major part of the unit
focuses on the ‘what’ and ‘how’ of strategizing, planning, executing, and
monitoring the CSR activities of companies.
After studying this unit, you will be able to:
Explain the policy formulation of CSR and organizational set up
Discuss the formation of CSR Committee of the Board of Directors, its
roles and responsibilities
Identify the thematic areas
Describe strategic project management
1.2 POLICY FORMULATION AND

ORGANIZATIONAL SETUP
Once a company is covered under the ambit of the CSR, it is required to comply
with the provisions of the CSR. The companies covered under Sub Section 1 of
Section 135 are required to do the following activities (Fig. 1.1 and Box 1):
7
Operationalizing CSR Fig. 1.1: Responsibilities of the CSR Committee
1)
Constitute a 2)
CSR Commit- Formulate a 3) 4)
tee CSR Policy Spend at least 2% Disclose the composition
of the average net of CSR committee and
profits of last 3 CSR policy and its imple-
years on CSR mentation in Board's
activities report
Box 1: List of Responsibilities of the CSR Committee

1) As provided under Section 135(1), companies are required to constitute a
Corporate Social Responsibility Committee of the Board “hereinafter CSR
Committee”. The CSR Committee shall comprise of three or more
directors, out of which at least one director shall be an independent director.
2) All such companies should formulate CSR Policy.
3) All such companies shall spend, in every financial year, at least two percent
of the average net profits of the company made during the three
immediately preceding financial years, in pursuance of its Corporate Social
Responsibility Policy. It has been clarified that the average net profits
shall be calculated in accordance with the provisions of Section 198 of
the Companies Act, 2013. Also, provison to the Rule 3(1) of the CSR
Rules that the net worth, turnover or net profit of a foreign company of
the Act shall be computed in accordance with the balance sheet and profit
and loss account of such company prepared in accordance with the
provisions of clause (a) of sub-section (1) of section 381 and section 198
of the Companies Act, 2013.
4) The Board’s report shall disclose the compositions of the CSR Committee.
(Sourse: http://finance.bih.nic.in/Documents/CSR-Policy.pdf 0N 12/12/19)
1.2.1 The Objectives of CSR Policy

CSR Policy of a company is laid down with the following objectives:
Establishing a guideline for compliance with the provisions of regulations
to dedicate the recommended percentage of company’s profits for social
projects.
Ensuring the implementation of CSR initiatives in letter and spirit through
appropriate procedures and reporting.
Creating opportunities for employees to participate in socially responsible
initiatives.
Many PSUs and conglomerates do have written policies being government
undertakings whereas, private companies of repute like Tata Steel, Reliance,
Ambuja, Aditya Birla also have developed detailed CSR policies. The CSR policy
reflects vision and mission statement, beneficiaries to be covered, thematic areas
8 undertaken, place of implementation, etc.
1.2.2 CSR Committee and Board Structural and Functional
Setup
The composition of the CSR committee varies based on the type of company.
Composition of CSR Committee
Type of Company Composition
Listed Three or more Directors including atleast
one Independent Director
Unlisted and Private Three or more Directors, an Independent
Director is mandatory
Private Two Directors
Foreign At least two persons, one of which must be
company’s represenative in India
Clause 135 of the Act lays down the guidelines to be followed by companies
while developing their CSR programmes. The CSR committee remains
responsible for preparing a detailed plan on CSR activities, including the
expenditure, the type of activities, roles and responsibilities of various
stakeholders and a monitoring mechanism for such activities.
Net worth> 500 crores INR

Turnover >1000 crores INR
Net profit > 5 crores INR
Role of the Board Role of the CSR Committee
Three or more Directors

Form a CSR committee including at least one
independent Director
Approve CSR policy Formulate and recommend a

CSR policy to the Board
Ensure implementation
of activities under CSR Recommend activities and
the amount of expenditure
Ensure 2% spend to be incured
Disclose reasons for not Monitor the CSR policy

spending the amount and projects from time
(if applicable)
to time
Fig 1.2: Role of the Board and the CSR Committee
The CSR committee can also ensure that all the kinds of income accrued to the
company by way of CSR activities should be credited back to the community or
CSR corpus. The Act requires that the board of the company shall, after taking
into account the recommendations made by the CSR committee, approve the
CSR policy of the company and disclose its contents in their report and also
9
Operationalizing CSR publish the details on the company’s official website, if any, in such manner as
may be prescribed. If the company fails to spend the prescribed amount, the
board, in its report, shall specify the reasons.
Formulating a policy document and the selection of the board and the committee
is an excellent starting point for any company new to CSR. In case a company
already practices CSR, this committee should be set up at the earliest so that it
can guide the alignment of the company’s activities with the requirements of the
Act.
For effective implementation, the CSR Committee must also oversee the
systematic development of a set of processes and guidelines for CSR to deliver
its proposed value to the company, including:
Processes such as developing CSR strategy and operationalizing the
institutional mechanism.
Repetitive processes such as the annual CSR Policy, due diligence of the
implementation partners, project development, project approval,
contracting, budgeting and payments, monitoring, impact measurement and
reporting and communication.
A set of such enabling processes, their inter-relationships and the sequence in
which they need to be developed have been identified in Fig. 1.3. While
developing these processes, no standard set of recommendations exist for all
companies. However, an overview of the required details, the activities required
to be completed for each of these processes along with some additional guidance
on critical issues have been provided below:
Developing a CSR Operationalizing the

1 Institutional Mechanism
Policy and Strategy
Due Diligence of
2 Project Development
Implementation Partners
Finalizing the Arrangement

3 Project Approval with the Implementing Agency
Project Implementation
4 Progress Monitoring and Reporting
Report Consolidation and

Impact Measurement
Communication
5
10 Fig. 1.3: Role of Committee in CSR Processes

1.3 METHODOLOGY OF CSR Setup
CSR is the procedure for assessing an organization’s impact on society and

evaluating its responsibilities. It begins with an assessment of the following
aspects of each business:
Customers
Suppliers
Environment
Communities, and
Employees
The most effective CSR plan ensures that while organizations comply with the
legislation, their investments also respect the growth and development of
marginalized communities and the environment. CSR should also be sustainable,
involving activities that an organization can uphold without negatively affecting
its business goals.
Organizations in India have been quite sensible in taking up CSR initiatives and
integrating them into their business processes. It has been progressively projected
in the Indian corporate setting because organizations have recognized that besides
growing their businesses, it is also important to shape responsible and agile
relationships with the community at large. Companies now have specific
departments and teams that develop specific policies, strategies, and goals for
their CSR programmes and set separate budgets to support them. Most of the
time, these programmes are based on well-defined social beliefs or are carefully
aligned with the company’s business domain.
1.3.1 CSR Trends in India

Since the applicability of mandatory CSR provision in 2014, CSR spending by
corporate India has increased significantly. In 2018, companies spent 47 percent
higher as compared to the amount in 2014-15, contributing INR 7,536 crores
(US $1 billion) to CSR initiatives, according to KPMG India CSR Reporting
Survey, 2018. Listed companies in India spent INR 10,000 crore (US$1.4 billion)
in various programmes ranging from educational programmes, skill development,
social welfare, healthcare, and environment conservation, while the Prime
Minister’s Relief Fund saw an increase of 139 percent in CSR contribution over
last one year.
The education sector received the maximum funding (38 per cent of the total)
followed by hunger, poverty, and healthcare (25 per cent), environmental
sustainability (12 per cent) and rural development (11 per cent). Programmes
such as technology incubators, sports, armed forces, reducing inequalities saw
negligible spends. Taking into account the recent amendments to CSR provisions,
industry research estimates CSR compliance to improve and range between 97
to 98 per cent.
11
Operationalizing CSR 1.3.2 Examples in CSR (India)
Tata Group - The Tata Group conglomerate in India carries out various CSR
projects, most of which are community improvement and poverty alleviation
programmes. Through self-help groups, it has engaged in women’s
empowerment activities, income generation, rural community development,
and other social welfare programmes. In the field of education, the Tata Group
provides scholarships and endowments to numerous institutions. The group
also engages in healthcare projects, such as the facilitation of child education,
immunization, and creation of awareness of AIDS. Other areas include
economic empowerment through agriculture programmes, environment
protection, providing sports scholarships, and infrastructure development,
such as hospitals, research centers, educational institutions, sports academy,
and cultural centers.
Ultratech Cement - Ultratech Cement, India’s biggest cement company is
involved in social work across 407 villages in the country aiming to create
sustainability and self-reliance. Its CSR activities focus on healthcare and
family welfare programmes, education, infrastructure, environment, social
welfare, and sustainable livelihoods. The company has organized medical
camps, immunization programmes, sanitation programmes, school enrollment,
plantation drives, water conservation programmes, industrial training, and
organic farming programmes.
ITC Group - ITC Group, a conglomerate with business interests across hotels,
FMCG, agriculture, IT, and packaging sectors has been focusing on creating
sustainable livelihoods and environment protection programmes. The
company has been able to generate sustainable livelihoods opportunities for
six million people through its CSR activities. Its e-Choupal programme, which
aims to connect rural farmers through the internet for procuring agriculture
products, covers 40,000 villages and over four million farmers. It’s social
and farm forestry programme assists farmers in converting wasteland to
pulpwood plantations. Social empowerment programmes through micro-
enterprises or loans have created sustainable livelihoods for over 40,000 rural
women.
The above examples show that companies adapt thematic areas of
interventions and accordingly plan their strategy to implement the same. In
next part of the unit, you will get to know the areas given under law to be
adapted by companies.
Source:https://www.india-briefing.com/news/corporate-social-responsibility-india-
5511.html/
Activity 1
Visit a CSR project being implemented in the city of your residence. Enquire
about the project coverage and its impact and write about them in your own
words.
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12
1.4 CSR THEMATIC AREAS / ACTIVITIES Setup
The policy recognizes that corporate social responsibility is not merely

compliance; it is a commitment to support initiatives that measurably improve
the lives of underprivileged by one or more of the following focus areas as notified
under Section 135 of the Companies Act, 2013, and Companies (Corporate Social
Responsibility Policy) Rules 2014:
i) Eradicating hunger, poverty and malnutrition; promoting preventive health

care and sanitation and making safe drinking water available;
ii) Promoting education, including special education and employment

enhancing vocation skills, especially among children, women, elderly and
the differently-abled; and livelihood enhancement projects;
iii) Promoting gender equality, empowering women, setting up homes and

hostels for women and orphans; setting up old age homes, day care centers
and such other facilities for senior citizens; and measures for reducing
inequalities faced by socially and economically backward groups;
iv) Reducing child mortality and improving maternal health by providing good
hospital facilities and low cost medicines;
v) Providing hospital and dispensary facilities with more focus on clean and
good sanitation so as to combat human immunodeficiency virus, acquired
immune deficiency syndrome, malaria and other diseases;
vi) Ensuring environmental sustainability, ecological balance, protection of

flora and fauna, animal welfare, agro-forestry, conservation of natural
resources and maintaining quality of soil, air and water;
vii) Employment enhancing vocational skills;
viii) Protection of national heritage, art and culture including restoration of

buildings and sites of historical importance and works of art; setting up
public libraries;
ix) Promotion and development of traditional arts and handicrafts;
x) Measures for the benefit of armed forces veterans, war widows and their
dependents;
xi) Training to promote rural sports, nationally recognized sports, sports and
Olympic sports;
xii) Contribution to the Prime Minister’s National Relief Fund or any other
fund set up by the Central Government for socio-economic development
and relief and welfare of the Scheduled Castes, the Scheduled Tribes, other
backward classes, minorities & women;
xiii) Contributions or funds provided to technology incubators located within
academic institutions, which are approved by the Central Government;
xiv) Rural development projects, etc.
13
Operationalizing CSR xv) Slum area development. Explanation — for the purposes of this item, the
term, slum area, shall mean any area declared as such by the Central
Government or any State Government or any other competent authority
under any law for the time being in force.
Eradication of
extreme
Other matters poverty and
as may be hunger Promotion of
prescribed education
Contribution to
Prime Minister's
Relief Fund and Gender equity
other state and and women
other funds empowerment
Schedule
VII
Employment Reducing child
enhancing mortality and
vocational skills improving mater-
nal health
Combating
Social
HIV/AIDS,
buisness
maternal and
projects
Environmental other diseases
sustainability
Fig. 1.4: Indicative activities under CSR specified under Schedule VII of the Act
Fig. 1.5: CSR Activities at NTPC
14
The above list is illustrative not exhaustive. All activities under the CSR domain Structural and Functional
Setup
should be environment friendly and socially acceptable to the local people and
society (Fig. 1.5, activities at NTPC under CSR). Contribution towards the Chief
Minister’s Relief Fund shall be a part of CSR activities over and above 2% of net
profit other than the activities mentioned above. Further the Ministry of Corporate
Affairs vide Notification dated 24.10.2014 increased the scope of contribution
made towards Corporate Social Responsibility Activities namely: contribution
to the Swatch Bharat Kosha setup by the Central Government for the promotion
of sanitation and contribution to the Clean Ganga Fund set-up by the Central
Government for rejuvenation of the River Ganga.
Check Your Progress - 1
Notes: a) Write your answers in about 50 words.
b) Check your answer with possible answers given at the end of the
unit.
1) Name the indicative activities which can be undertaken by a Company under
CSR.
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2) Describe the composition of the CSR Committee.

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1.5 CSR: STRATEGIC PLANNING

For effective implementation, the CSR committee must also oversee systematic
development of a set of processes and guidelines for CSR to deliver its proposed
value to the company, as discussed in Section1.2.2. Now this section discusses
an identified set of enabling processes, their inter-relationships and the sequence
in which they need to be developed as shown in Fig 1.3. While developing these
processes, no standard set of recommendations exist for all companies. Following
are suggested steps involved in strategic planning while developing the
programme.
1.5.1 Steps in Strategic Planning in CSR

Each step is described generally under three major heads. The first head deals
with the purpose of that step. The second head deals with the process which
15
Operationalizing CSR covers the objectives of that step, the owners of that particular step, the inputs
required and the outputs generated as a result of fulfillment of that step. The
third head describes the various activities that will form a part of that particular
step.
Step I: Developing a CSR Strategy and Policy

a) Purpose: CSR strategy refers to what the company expects to achieve in
the next three to five years and incorporates the vision, mission and goals
on a broader level. It also outlines how it plans to achieve these in terms of
organization and approach.
b) Framework: An effective CSR strategy should articulate its (i) target group;
(ii) area of operation (iii) sectors or issues it wishes to address.
c) Process:
Objective: Developing the CSR strategy and policy.
Process owners: The CSR committee is the owner of the process.
Inputs: Guidance from the Board, requirements of the Companies Act,
business strategy and plan of corporate, the involvement of the supply
chain are needed; both, national and other interests of the company would
be included in development priorities.
Output(s): The CSR Policy document, identification of sectors and issues,

and actual benefit of people are the output.
d) Activities: The first part of activities would be reviewing the past and
monitoring the current CSR activities to match Schedule VII of the
Companies Act, 2013; Second part will define the company’s activities
under CSR strategies for next 3 to 5 years.
e) Vision and Mission: The CSR thrust is on community development. A

CSR vision statement is a vivid, compelling description of its future CSR
position.
i) Sectors and issues: CSR covers a broad spectrum of issues that must
be taken into account in business conduct. This includes working
conditions, human rights, and the environment, preventing corruption,
corporate governance, gender equality, occupational integration,
consumer interests and taxes.
ii) Area of operation: States and districts; underperforming states not a

priority for CSR fund. Policy anomaly tilts CSR scales in favour of
states.
iii) Beneficiaries: The target beneficiaries have every right to know if there
is any social auditing and certification process in place for the money
taken out (in their name) by the corporate world to check the impact of
CSR.
iv) KPIs (Key Performance Indicators): Global Reporting Initiative’s

(GRI) reporting guidelines, specifically its performance indicators, can
be used to help a company create ethical Corporate Social Responsibility
16
(CSR) strategies and to also help stakeholder groups evaluate how much Structural and Functional
Setup
of a company’s CSR initiative truly means the stakeholder definition
of CSR and how much is merely philanthropy or marketing.
v) Determining the implementation mechanism:

i) Grant-making or direct implementation;
ii) Institutional mechanism: in-house department, corporate foundation,
partnerships with other NGOs; implementation of CSR means that
enterprises abide by laws, regulations, social norms and business
ethics, effectively manage the influence of the corporate operation
upon the stakeholders and the natural environment, and maximize
the comprehensive value in economic, social and environmental
aspects.
vi) Establish methods for monitoring and reporting: CSR project

monitoring, evaluation and reporting are management requirements for
the successful implementation of any CSR project to ensure that the
said project achieves the required objectives.
Example-The Aditya Birla group has a vision “To actively contribute

to the social and economic development of the communities in which
it operates. In doing so, build a better, sustainable way of life for the
weaker sections of society and raise the country’s human development
index”.
Aditya Birla CSR Achievements

Runs 5,000 medical camps and 20 hospitals
Immunized 70 million children against polio
Operates 56 schools for 46,500 school children
Skill training for 95,000 people
Mid-day meal every day for 63,000 children in 268 schools
Provide solar lamps for 450,000 school children
Step II: The Institutional Mechanism
a) Purpose: In order for a corporate to gain the greatest leverage and a strategic
advantage through the investment of intellectual and financial resources,
they are required to select their implementation mechanism. In terms of
implementation mechanism, a company has several options, which are
permitted under the CSR draft rules:
i) The grants can be made directly by an in-house CSR Department or

through the company’s grantmaking foundation.
ii) Making grants to an independent implementation partner (which has a

track record of at least three years), e.g., NGOs of state or national
repute.
17
Operationalizing CSR b) Process:
Objective: A company’s objective is to establish a legal entity and aligning
the accounting, tax, finance, administration, HR and IT systems to deliver
the commitments made in the CSR policy.
Process owners: The CSR committee is the process owner.
Inputs: The CSR strategy
Output(s): (i) Creation of a separate legal entity or a CSR Department for
CSR activities; (ii) Other institutional mechanisms to align the accounting,
finance, administration, HR and IT systems with CSR activities.
c) Activities: For the CSR implementation the company should have an

in house CSR department or it can collaborate with a trust, society,
foundation (Not for profit Section 8 Company) for example Aditya Birla
Centre for Community Initiatives and Rural Development works with
WHO, Australia India Council, Bill and Melinda Gates Foundation, Habitat
for Humanity, CII, European Union (EU), Global Compact Network,
International Rotary Club, National Skills Development Council, FICCI,
NABARD, NACO, CARE, IGNOU, Aide et Action, SEWA, BAIF,
MYRADA, Basix, CARD, Art of Living Foundation, Smile Foundation,
Maya Foundation, ChildLine India Foundation and local NGOs.
The next step would be to identify the implementation model (grant making,
direct project execution, etc.). A funding source needs to be finalized; for
CSR work, employees’ job descriptions, their roles and responsibilities
should be clearly stated and a proper reporting system to the CSR team
should be defined. The existing finance, administration and IT systems
should have a clear picture of the total CSR fund received, its expenditure
and balance. The CSR team should be intimated well in advance about the
allocation for the expenses (or assets created) so that the work of running
the project should not be hampered.
Activity 2
Visit a CSR project being implemented in the city of your residence. Enquire
about and record the names of the project partners involved in the
implementation of that project.
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Step III: Due Diligence of the Implementation Partner

a) Purpose: Due diligence refers to the process a company undertakes to
determine the risks as well as the benefits of working with a potential
implementation partner. This process has to be sufficiently effective to
ensure that a company’s implementation partners have the reputation,
18
competence and integrity to deliver effective programmes on the ground. Structural and Functional
Setup
The due diligence process consists of five primary areas for investigation:
competence of the implementation partner; identity; management;
accountability; transparency and financial capability.
b) Process:
Objective: Selecting the implementation partner.
Process owners: The CSR department or company foundation.
Inputs:
i) The CSR Strategy and Policy.
ii) Discussions with communities, management, staff, other funders, local
government officials, local leaders or influencers, auditors studying
the books of accounts and the auditor’s report.
Output(s): A due diligence report.
c) Activities: Establishing a due diligence criteria to evaluate the
implementation, permits and licenses, systems, processes, public image,
management, team strength, track record, financial capacity, competence
level, presence in desired geography, compatibility with company CSR
policy. Establishing due diligence criteria for evaluation and empanelment
of private funders for partnership and joint projects is also required.
Evaluating partnership opportunities for its risks and benefits and any
conflicts of interest between the stakeholders need to be identified.
Step IV: Project Development

a) Purpose: The CSR strategy of a company will be implemented through a
series of projects with clearly identified starting to end cycle. It has to
have synergy between input and output i.e., funds, other resources, and
total expenditure. These projects could be of any length, short duration (a
few months) or multi-year.
b) Process:
Objective: Developing a feasible project proposal.
Process owners: The implementation agency (the CSR department,
company foundation or the NGO partner).
Inputs: (i)The CSR Policy (ii) Institutional mechanisms (iii) Information
from the government sources, previous studies done in the area, etc. (iv)
Information on programmes targeting similar geographies and beneficiary
groups or strategies (v) Monitoring impact, measurement reports from any
earlier Projects.
Output(s): A project proposal that details:
i) project context including the roles of other stakeholders;
ii) key needs of target beneficiaries;
iii) project goals, KPI (Key Performance Indicators), baselines and expected
end lines;
iv) project milestones for progress monitoring purposes;
19
Operationalizing CSR v) activities and timelines to achieve the stated project goals;
vi) budgets along with the purpose of expenditure;
vii) risks and mitigation strategies;
viii) progress reporting: step by step narration from starting to end.
c) Activities:
i) Developing a framework to identify key stakeholder groups including
the local community, the local government or bodies, academia and
research institutions, investors, etc.
ii) Conducting a needs assessment (if required) to assess development

priorities. The methodology for this can be participatory processes,
surveys or a combination of the two.
iii) Studying and adopting good practices to address similar challenges

based on prior experiences or lessons available from other practitioners
and develop the approach.
iv) Detailing the project: objectives, beneficiaries and impact on the

beneficiaries, assumptions, expected outputs and outcomes, detailed
activities, potential to influence public policy and practice.
v) Identifying indicators of success with the means of verification and

establish baseline for each. This can be commissioned as a separate
study or can even be included at the need assessment stage.
vi) Estimating the budget and how it will be funded specifying community
contributions, leveraging of government schemes and contributions
from other donors.
vii) Indicating monitoring and evaluation methodologies for impact

measurement.
Step V: Project Approval

a) Purpose: Every Project, whether developed by the in-house team or an
external agency, must be formally examined and approved. This is to ensure
that each project is in line with the CSR strategy and policy, that the
monitoring indicators are clearly defined and relevant and that there is
adequate budget available. The projects must be scrutinized carefully for
their durations and resource demands.
The CSR committee is ultimately responsible for every project. It can,

however, choose to delegate authority to a project approval committee
consisting of company staff and outside experts with clearly defined roles
and responsibilities.
b) Process:
Objective: Approve projects based on the CSR policy objectives, principles
and guidelines.
Process owners: The CSR committee or the delegated project approval
committee.
20
Inputs: Project proposal; due diligence report. (Should be forwarded to Structural and Functional
Setup
the implementation unit)
Output(s): An approved project proposal including a monitoring process

and reporting and clear-cut delegation of work, i.e., who will do what should
be outlined.
c) Activities:
i) Determining the delegation of power for project approval;
ii) Establishing an evaluation framework for appraisal of the project
concepts;
iii) The project concept should align with CSR policy;
iv) Establish theory of change. This requires need based tests which result
in value for money and efficiency;
v) Reviewing risks and mitigation measures;
vi) Identifying resource availability and any specific organizational
requirements and constraints;
vii) Laying down organizational supervision and oversight requirements.
Step VI: Finalizing the Arrangement with Implementing Agency
a) Purpose: While working with an external agency, it is very important to
enter into a formal arrangement which is referred to, here, as a Memorandum
of Understanding or MoU. It defines the roles, responsibilities, deliverables,
commitments and consequences in case of any breach. This is essentially a
formal acknowledgement that all the partners have voluntarily consented
to work together to achieve an agreed outcome that requires each one to
play their respective roles.
b) Disbursement scheduling: For a project to deliver the desired results, it
should have sufficient funds and resources to carry out the planned activities.
At the same time, having excess funds in the bank account is not prudent
financial management. Thus, the scheduling of disbursements is important
both for the company (to plan its cash flows from the CSR budget) and the
implementing agency, and hence needs to be detailed in the MOU.
A good practice suggests that the scheduling of disbursements should be
linked with the activities planned for each period; this can be a quarter, six
months or a year depending upon the administrative convenience and budget
sizes. Thus, the project budget needs to be broken up accordingly and the
funds required for the subsequent period should be made available in
advance.
c) Process:
Objective: Agree upon and sign MoU with the partner.
Process owners: The CSR Department or Company Foundation.
Inputs: (i) An approved project proposal
(ii) A due diligence report
Output(s): MoU with the implementing agency including disbursement
schedule. 21
Operationalizing CSR d) Activities:
i) Developing a template for the MoUs based on the context. Specify the
outputs and outcomes, the approach and methodology, the KPIs, key
parameters to be monitored and reported, the mode of communication,
contract management team, scope of change in management procedures,
dispute or conflict resolution mechanisms, inspection and audit
requirements, contract close out requirements, timelines, milestones
and deliverables, budgets, process of invoicing and release of payments,
etc.
ii) Establishing a process for negotiation (the MoU with the implementing
Agency).
iii) Finally, agreeing upon and signing the MoU.
Step VII: Progress Monitoring and Reporting
a) Purpose: Routine progress monitoring serves the following three important
purposes:
i) It highlights any shortcomings and helps to determine corrective action

that must be taken if need be
ii) It provides an excellent opportunity for learning: what worked and

what did not. This can then be immediately applied to other projects
iii) This is an essential part of the Directors’ Report as per the CSR clause
of the Companies Act, 2013.
b) Process:
Objective: Monitoring progress, learning lessons and helping to prepare
the reporting.
Process owners: The CSR committee
Inputs: (i) The approved project proposal
(ii) Previous monitoring reports.
Output(s): (i) Determining mid-course corrections
(ii) Recommendations for future project designs
(iii) Project monitoring reports to the CSR committee.
c) Activities: (i) Based on the approved project proposal, the need is to
determine the monitoring schedule for each project;
ii) Obtaining all relevant progress reports from the project, studying them
and making a note of the gaps;
iii) Holding discussions with the implementation team about shortcomings

(if any) and to agree on corrective actions. This may be done through a
field visit or remotely, based on what has been agreed in the MoU;
iv) Holding discussions with the implementation team regarding what

lessons are emerging and how they can be applied within the project as
well as outside.
22
Step VIII: Impact Measurement Structural and Functional
Setup
a) Purpose:
The impact of CSR projects can be varied. For instance, a girl child
education programme can show increased enrolment and retention of girls.
Further impact such as improved learning levels, will take at least a year.
So, impact measurement studies have different objectives from project
monitoring and typically have to be undertaken after providing sufficient
time for them to manifest.
b) Process:
Objective: Measuring outcomes and impact of projects.
Process owners: The CSR committee
Inputs: How resource planning is done and alignment with the project
MoU.
Output(s): On the basis of the impact measurement report,
recommendations for future project designs need to be taken care of.
c) Activities: (i) Identifying methods for conducting impact assessment and
outcome measurement suited to the context and size of the project and
budgets available.
ii) Defining the skills required for the impact measurement team and
accordingly identifying, selecting and appointing the team.
iii) Assisting the team in sample selection, conducting surveys and ‘Focus
Group Discussions’.
iv) Making provisions for site visits by the team.
v) Undertaking the impact measurement exercise and preparing the report.
vi) Identifying lessons for future interventions.
Step IX: Report Consolidation and Communication

a) Purpose: Reporting and communication close the loop between intent and
achievement and are hence crucial elements of the CSR process. In the
context of the Companies Act, 2013 this is also a mandatory requirement
as it provides crucial inputs to preparing the Directors’ Report.
b) Process:
Objective: Reporting the CSR at an individual project level, consolidated
at a programme level and aligned with the requirements under the
Companies Act, 2013 and the CSR committee.
Process owners: The CSR department
Inputs: CSR strategy and policy. It needs to be ensured that monitoring
reports are aligned with the project MoU,
Output(s): Finalization of CSR reports. The report should be disseminated

to the Board of Directors, investors, government agencies, beneficiaries,
etc. 23
Operationalizing CSR c) Activities: (i) Selecting the appropriate reporting framework that is aligned
with requirements of the Companies Act, 2013 and global best practices;
ii) Consolidating project reports into programme reports and an overall

CSR report
iii) The reporting format is a part of the CSR rules.
b) Check your answer with possible answers given at the end of the unit.
1) Enumerate the Companies Act, 2013, Section135: CSR Committee
requirements.
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2) Enlist the nine steps of CSR Process.

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1.6 LET US SUM UP

Implementation of CSR within an organization is an important element for
companies today. The unit explores different steps in the CSR implementation
process, with the intention to create a dynamic CSR implementation model that
could be utilized by organizations as guidelines when implementing CSR within
their organization. CSR implementation is a complex process that needs to be
integrated in every part of the organization and in the daily activities in order to
be successful. CSR implementation process should also be seen as an ongoing
and never ending process, rather than a strategy implementation with an evident
beginning and ending.
1.7 KEYWORDS
UN Global Compact: The United Nations Global Compact is a non-binding
United Nations pact to encourage businesses worldwide to adopt sustainable
and socially responsible policies, and to report on their implementation. The UN
Global Compact is a principle-based framework for businesses, stating ten
principles in the areas of human rights, labor, the environment and anti-corruption.
24
Key Performance Indicator: A Key Performance Indicator is a measurable value Structural and Functional
Setup
that demonstrates how effectively a company is achieving key business objectives.
Organizations use KPIs at multiple levels to evaluate their success at
reaching targets.
Memorandum of Understanding (MoU): A memorandum of understanding

(MoU) is a type of agreement between two (bilateral) or more (multilateral)
parties. It expresses a convergence of will between the parties, indicating an
intended common line of action.
1.8 BIBLIOGRAPHY AND SELECTED READINGS

Articles
Baron, R. M., & Kenny, D. A. (1986). The moderator–mediator variable
distinction in social psychological research: Conceptual, strategic, and statistical
considerations. Journal of Personality and Social Psychology, 51(6), 1173–1182.
Bhattacharya, C. B., & Sen, S. (2003). Consumer-company identification: A

framework for understanding consumers’ relationships with companies. Journal
of Marketing, 67,76–88.
Bhattacharya, C. B., & Sen, S. (2004). Doing better at doing good: When, why,
and how consumers respond to corporate social initiatives. California
Management Review,47(1), 9–24.
Bhattacherjee, A. (2001). Understanding information systems continuance: An

expectation-confirmation model. MIS Quarterly, 25(3), 351–370.
Brammer, S. J., & Pavelin, S. (2006). Corporate reputation and social performance:
The importance of fit. Journal of Management Studies, 43(3), 435–455.
Crane, A. (2001). Unpacking the ethical product. Journal of Business

Ethics, 30(4), 361–373.
Du, S., Bhattacharya, C. B., & Sen, S. (2010). Maximizing business returns to
corporate social responsibility (CSR): The role of CSR communication.
International Journal of Management Reviews, 12(1), 8–19. doi: 10.1111/j.1468-
2370.2009.00276.x.
Garriga, E., & Melé, D. (2004). Corporate social responsibility theories: Mapping
the territory. Journal of Business Ethics, 53, 51–71.
Oliver, R. L. (1980). A cognitive model for the antecedents and consequences of

satisfaction. Journal of Marketing Research, 17, 460–469.
Schultz, F., Castelló, I., & Morsing, M. (2013). The construction of corporate
social responsibility in network societies: A communication view. Journal of
Business Ethics,115, 681–692.
Books & Reports

Bentele, G., & Nothhaft, H. (2011). Trust and credibility as the basis of corporate
social responsibility: (Mass-) mediated construction of responsibility and
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Operationalizing CSR accountability. In: Ø. Ihlen, J. Bartlett, & S. May (Eds.), The Handbook of
Communication and Corporate Social Responsibility (pp. 208–230). Boston:
Wiley.
Bhattacharya Debasis (2006) ‘Corporate Social Development- A Paradigm Shift’,

Concept Publishing Company, New Delhi.
Hayes, A. F. (2013). Introduction of mediation, moderation, and conditional

process analysis: A regression-based approach. New York: The Guilford Press.
Hou, J., & Reber, B. H. (2011). Dimensions of disclosures: Corporate social

responsibility (CSR) reporting by media companies. Public Relations
Review, 37(2), 166–168.
Waddock, S., & Googins, B. K. (2011). The paradox of communicating corporate

social responsibility. In: Ihlen, J. Bartlett, & S. May (Eds.), The Handbook of
Communication and Corporate Social Responsibility (pp. 23–43). Boston: Wiley.
1.9 CHECK YOUR PROGRESS - POSSIBLE

ANSWERS
1) The activities specified are:
Eradication of extreme poverty and hunger
Promotion of education
Gender equity and women’s empowerment
Reducing child mortality and improving maternal health
Combating HIV/AIDS, maternal and other diseases
Environmental sustainability
Social business projects
Employment enhancing vocational skills
Contribution to the Prime minister’s Relief Fund and other state and
other funds
Other matters, as may be prescribed
2) The CSR committee has the following composition based on the type of
company:
Listed Company: Three or more Directors including at least one
Independent Director.
Unlisted and Private Company: Three or more Directors, Independent
Director is mandatorily required to be appointed.
Private Company : Two Directors.
Foreign Company: At least two persons, one of which must be
company’s representative in India.
26
Check Your Progress - 2 Structural and Functional
Setup
1) Companies Act, 2013, Clause 135: CSR committee requirements are:
A CSR Committee of the Board should be constituted. It should consist
of at least three Directors out of whom at least one is an independent
Director. This composition will be disclosed in the Board’s Report, as
per sub-section (3) of section 134.
The CSR Committee shall:
o Formulate and recommend a CSR Policy to the Board, indicating
the activities as specified in Schedule VII of the Act
o Recommend the amount of expenditure to be incurred on the

activities indicated in the Policy
o Monitor the CSR Policy regularly.
2) The nine steps of CSR process are:
1. Developing a CSR Strategy and Policy
2. Operationalizing the Institutional Mechanism
3. Due Diligence of the Implementation Partner
4. Project Development
5. Project Approval
6. Finalizing the Arrangement with the Implementing Agency
7. Progress Monitoring and Reporting
8. Impact Measurement
9. Report Consolidation and Communication
27
UNIT 2 BUSINESS STRATEGY IN CSR
Structure
2.1 Introduction
2.2 Business Strategy: Concept and Overview
2.3 Strategic Positioning with Respect to CSR
2.4 CSR as Business Case
2.5 Sustainable Corporate Strategy
2.6 Let Us Sum Up
2.7 Keywords
2.1 INTRODUCTION
The Prime Minister’s “Social Charter” calls for inclusive growth and affirmative
action from the corporate sector. In December 2009, voluntary Corporate Social
Responsibility (CSR) guidelines were issued by the Ministry of Corporate Affairs.
Subsequently, the Indian public sector was issued a set of policy guidelines by
the Department of Public Enterprises which also linked to CSR and the
Millennium Development Goals. One significant guideline in the public sector
policy is that companies need to put at least 5 % of their Profit After Tax (PAT)
into CSR. Many companies set up their own foundations, often run by an
employee of the company, and work with civil society was minimal, coming
within the realm of “project implementation” than partnership.
Sustainable development is the organizing principle for meeting human

development goals while at the same time sustaining the ability of natural systems
to provide the natural resources and ecosystem services upon which the economy
and society depend. World Commission on Environment and Development, Our
Common Future (1987) defined ‘Sustainable Development’ as development that
meets the needs of the present without compromising the ability of future
generations to meet their own needs. It contains within it two key concepts-the
concept of ‘needs’, in particular, the essential needs of the world’s poor, to which
overriding priority should be given; and the idea of limitations imposed by the
state of technology and social organization on the environment’s ability to meet
present and future needs.
As a reader you might be thinking of sustainable development in terms of

development of the larger society. An example will be a large corporate doing
philanthropy for destitute in a natural resource laden tribal area where they have
mining interest or some other interest. Does sustainable development for larger
society include sustainable development of the business itself? Do we assume
that corporates are always benevolent souls and without any self-interest they
genuinely contribute to the society? They do contribute, the family businesses
in India are a prime example to this. But is this always the case? For public
sector enterprises in India, CSR became mandatory even before the present
regulations came about. For private sector it was not mandatory before 2014 but
we have seen some amazing work done by the private enterprises narrated in
28
other units, which has real long-term positive impacts on the society and the Business Strategy in CSR
business itself. The focus of this unit is that CSR is a business case. The need of
the hour is to embed the CSR strategy with the long-term business strategy.
After reading this unit you will be able to:
Define business strategy and state its importance
Explain the steps involved in sustainable corporate strategy
Discuss the market risks involved in sustainable marketing
2.2 BUSINESS STRATEGY: CONCEPT AND

OVERVIEW
A business strategy can be defined as the combination of all the decisions taken
and actions performed by the business to accomplish the business goals and to
secure a competitive position in the market. It is the backbone of the business as
it is the roadmap which leads to the desired goals. Any fault in this roadmap can
result in the business getting lost in the crowd of overwhelming competitors
(Pahwa, 2019).
Different businesses have their own goals. In order to achieve these goals, the
businesses need to have a well thought out strategy. Other than the goals of the
organization and the means to achieve those goals, an effective business strategy
should also take into account the main competitors of the business as well as the
strategy they employ to stand out in the business. It should also take into account
the target market and their needs and expectations. Finally, a business strategy
should take into account the long-term goal of the organization.
The following are the importance of a good business strategy:

1) Gives Direction: A good business strategy gives proper direction to the
organization and ensures that all work towards attaining the common goal.
It instills a feeling of shared responsibility among the employees.
2) Measures Success: It helps in measuring the success of the organization

as against the goals set in the business strategy. It also helps in identifying
the areas which require improvement to lead the organization to achieve
the stipulated goals.
3) Increases Adaptability: We live in an era of rapid change. The technology,

market needs, demands, etc., are changing rapidly. A good business strategy
helps in keeping track of the changes occurring in the market like changing
demands, customer expectations and needs and also helps in adapting to
these changes and keeping pace with the market trends.
4) Drives Decisions: A good business strategy drives decisions in a business

by identifying the strengths and weaknesses of the organization and
identifying the best possible ways to spend the resources to maximize profits
and move towards a sustainable future.
29
2.3 STRATEGIC POSITIONING WITH RESPECT
TO CSR
In order to understand strategic positioning of a company for CSR initiatives, it
is important to understand its stage. When it comes to developing a sense of
corporate responsibility, organizations typically go through five stages as they
move along the learning curve (Table 2.1).
Table 2.1: Important Ethical Issues Confronted by Businesses
STAGE WHAT ORGANIZATIONS WHY THEY DO IT?

DO?
DEFENSIVE Deny practices of outcome To defend against attacks

and responsibility to their reputation that in
the short term could affect
sales, recruitment,
productivity, and the
brand
COMPLIANT Adopt a policy-based To mitigate the erosion of

compliance approach economic value in the
medium term because of
ongoing reputation and
litigation risks
MANAGERIAL Embed the societal issue To mitigate the erosion of

in their core management economic value in the
processes medium term and to
achieve long term gains
by integrating
responsible business
practices into their daily
operations
STRATEGIC Integrate the societal issue To enhance economic

into their core business gains in the long term and
strategies to gain first-mover
advantage by aligning
strategy and process
innovations with the
societal issues
CIVIL Promote broad industry To enhance long-term

participation in corporate economic value by
responsibility overcoming any first
mover disadvantages and
to realize gains through
collective action
Source: The Path to Corporate Responsibility, Harvard Business Review, 2004
30
In the table above, we can see that corporations in India are at the managerial Business Strategy in CSR
stage and that there is an immediate need to shift the corporations to strategic
and thereafter to the civil stage.
Activity 1
Visit a company involved in CSR in the city of your residence and talk to the
CSR head of the company regarding its vision on CSR. Based on their response,
which stage do you think the company can be categorized into and why?
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This concept of CSR focuses more directly on day-to-day business practices

which will evolve into long term and sustainable growth. By definition, business
practices that adhere to the principles of corporate responsibility and sustainable
development must take the long and multidimensional view of their outcomes.
That is, they must manage for both private returns and societal returns, and do so
with the view that the company will remain a growing concern for the indefinite
future. This entails a commitment to inter-generational responsibility, equitable
development and environmental stewardship, the key building blocks of corporate
responsibility as well as sustainability. By integrating socially responsible
principles into their corporate strategies, companies have been able to make
impressive financial gains while improving the communities in which they
operate.
2.4 CSR AS BUSINESS CASE

The practice of CSR and philanthropy is not new to Indian businesses. Many
Indian conglomerates and business houses have a rich history of social welfare
activities and interests behind them. Yet, our country continues to be a land of
contradictions. On the one hand, we have one of the largest economies, and on
the other, a third of the world’s poor; we have an abundance of political freedom,
and yet a deficit of economic opportunities for all. While the USD 20 billion
Indian pharmaceutical industry today is the third largest API (Active
Pharmaceutical Ingredient) market in the world, yet, 24 per cent of the world’s
tuberculosis cases were reported in India. We are considered as the outsourcing
destination of the world, and yet the world’s largest population of illiterate people
resides in India.
Correcting these imbalances and ensuring the economic prosperity of over one
billion people continues to be one of the greatest challenges in the decades ahead.
It is a challenge that requires us to create employment opportunities; improve
the quality of human capital through education, skilling and training; provide
accessible healthcare; deliver affordable shelter; ensure food security; and create
institutions that are transparent, responsive and efficient. Doing this requires
companies to be inclusive in their approach of business and pursue a ‘triple
31
Operationalizing CSR bottom line’ instead of being focused purely on their financial results. This Unit
highlights business strategy in CSR for sustainable development with the help
of various case studies.
Corporate Social Responsibility is defined as follows:
Social responsibility is the responsibility of an organization for the impact of its
decisions and activities on society and the environment through transparent and
ethical behavior that
is consistent with sustainable development and the welfare of society;
takes into account the expectations of stakeholders;
is in compliance with applicable law and consistent with international norms
of behavior; and
is integrated throughout the organization.
The different areas of CSR interventions are community, workplace, marketplace,
and environment and supply chain. So let’s focus on the community stakeholder
first. Remember, Coca Cola was banned from using ground water for its
Plachimada Plant in Palakkad district, Kerala. The reason was the drought-like
situation that was created in that district because of the gross misuse of the natural
resource. Let’s see the impact; it is well known that Coca Cola and Pepsi are
already struggling in the Indian Market. They had to bring variants that suited
the Indian Market like Nimbooz, etc., which involved significant costs. Coke
spent so much on its advertisement and distribution. So, this single episode
impacted both demand and supply adversely. From the supply point of view this
plant was the only plant in Kerala, so it impacted the supply and distribution in
Kerala. From the demand side, the company’s brand image received a blow.
Kerala has higher per capita income and education levels than the rest of India.
Pepsi has always been an alternative to consumers in almost every part of India.
The consumers understood that the company was working against the interest of
the society and there was also an alternative (Pepsi) present in the market and
hence the consumer preferences started tilting away from the company associated
with violation. Community is a stakeholder for the business. Business must
understand its economic, legal, and ethical responsibilities towards stakeholders
as well as recognize the opportunities and challenges that every stakeholder
presents.
Example 1: ITC e-Choupal Initiative

Let’s focus on the famous e-Choupal initiative by ITC. This project is perceived
as IT for masses, which it should be because of the tremendous amount of
improvement it has brought to the life of the common man. Farmers can look at
weather forecasts, order fertiliser and herbicide, and consult an agronomist by e-
mail when their crops turn yellow. At some e-Choupals they can even buy life
insurance, apply for loans and also check their children’s exam results. While
much has been written about the social benefits of ITC’s e-Choupal, the fact of
the matter is that the project was conceptualised with a pure business focus to
create farmer communities in villages to facilitate sourcing of high-quality farm
produce for the company’s fast-growing agribusiness. Here again from the supply
side, ITC got a huge benefit because of elimination of middleman and a superior
produce received by it directly from the farmer. Here ITC recognized the needs
of the stakeholder, which is the farmer. In IT parlance, e-Choupal is an intelligent
32
blend of applications like community resource mobilization and supply chain Business Strategy in CSR
management. For instance, by helping the farmer identify and control his inputs
and farming practices, and by paying more for better quality, ITC has been able
to preserve the source and improve the quality of produce. The portfolio of
commodities sourced has been vastly expanded to include maize, barley, sorghum,
and pulses, and the sourcing cycle is extended almost around the year. In the
commodities market, these two factors are helping ITC create a definite
competitive advantage. ITC now plans to leverage its e-Choupal infrastructure
to sell third party products, provide rural market research services, and in the
social sector, to provide services like health advisories and enable e-governance.
Just look at the benefit of this CSR activity for ITC. Do you still feel CSR is
giving some pay checks to vulnerable people because the company has huge
resources at its disposal? Enabling e-governance would mean partnering with
the respective state or central government to implement their social schemes
with the e-Choupal platform. The e-Choupal CSR strategy proved to be the
business growth story for ITC.
Look at the innovations happening around us. These ideas are not like patents
that Apple Company has. India requires its own kind of innovations. For Example,
Rural BPOs and Self Help Groups (The famous Shakti project by HUL (Hindustan
Unilever Ltd.), was emulated by so many corporates. These are aimed at providing
livelihoods to the poor but at the same time this was an innovative method by the
company to improve the bottom line. Lijjat Papad is a famous brand. These
papads are made by women in their households, who make papads and supplement
their family income. Is this some charity by Lijjat Pappad? No, it’s their business
model. Such models provide an opportunity for dignified and safe work, which
everybody deserves. These models are not only reducing the company’s supply
constraints in a big way but they also provide avenues for substantial cost
reduction.
Example 2: L&T Employee Health Checks
Larsen and Toubro was one of the first organisations to screen its workforce for
detection of HIV/AIDS. This happened when the first case of HIV/AIDS was
detected in India. It is part of CSR. In fact, this dimension, in CSR parlance, is
called workplace CSR. L&T has a major stake in it because its employees are
mostly labourers who are more susceptible to the disease. Labour productivity is
directly correlated with labour health and company’s productivity is directly
correlated to labour’s productivity. Many organisations, especially those with a
large labour force, have employee health checks as a part of workplace CSR.
Example 3: GE Technology in Water Purification, Power Generation and

Health in Africa
GE on its part launched a 5-year project, a $20 million commitment, where the
company would use its extensive knowledge and technology in water purification,
power generation, and health care to help upgrade existing hospitals and build
new medical centers in Africa. The company enlisted relevant stakeholders in
the community (e.g., the health ministry to furnish supplies and assign a doctor;
local community members to volunteer labour) and provided the necessary high-
tech equipment (power generators, water purification equipment) and project
management expertise. The first major site was Ghana. This investment was in
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Operationalizing CSR line with GE’s commercial interest. Don’t you think that Africa and other
underdeveloped and developing nations have serious water purification, power
generation and healthcare concerns? GE was sending its employee force to Africa
for building a prototype which they would further leverage and cash in with
expansion of their business in the above mentioned markets. This kind of branding
would indeed help GE generate top-of-mind recall among various government
bodies and civic organizations, which could help the company to generate business
in future. For GE the African market and the other emerging markets are the next
avenues of growth.
There are a number of examples which we can go on citing. But the fact of the
matter is, in the new business environment many organizations have developed
clear CSR efforts as strategic branding and management approach in achieving a
win-win outcome. Any prospective investor in the current scenario would invest
in companies that act with good corporate governance and social responsibility.
Increasingly, a company’s performance as a responsible business is key to its
financial and stock market standing, helping to protect it from instability and
share price volatility.
Look from any angle, say environment waste management or energy conservation.
Study any environment waste management, and you would find an underlying
effort to bring about operational efficiency. It was in Tata’s interest to build the
steel city of Jamshedpur as a model city. This is called sustainability. There are
short sighted companies which indulge in illegal activities to cause harm to the
environment and they are doing this at their own peril. Let’s study this from the
demand and supply point of view. What is land or water or air or groundwater;
are they not part of the supply side? If an industry set up in an area keeps on
inefficiently using the groundwater of that area, say for 5 years, then what will it
do in the 6th year? All the money saved from exploitation will be lost from 6th year
onwards and then the company will have to bear added expenses in future. The
demand will slump due to fall in its image. Corporate branding is very important
in maintaining and attracting new customer base.
Note: a) Write your answer in about 50 words.
b) Check your answer with possible answers given at the end of the unit
1) Define Business Strategy.
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2) What are the challenges faced by our country today and how can the
corporates help in overcoming these challenges?
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34 .......................................................................................................................
2.5 SUSTAINABLE CORPORATE STRATEGY
For every company like Unilever and Wal-Mart that has successfully embedded
sustainability into their core business, there are many others that are struggling
with the implementation of corporate sustainability strategies. To be sure, every
company presents a unique case and requires a comprehensive review of its
strategy, operations and goals to advance sustainable practices. There is no single
path to adopt sustainability, but critical steps exist that can help to successfully
integrate sustainability into a business strategy. This section will focus on these
steps, essentially creating a roadmap for the development and implementation of
a corporate sustainability strategy.
Raising C-suite (executive level managers or highest ranking senior executives

in an organization) awareness of sustainability benefits is a critical initial step
before even creating a roadmap. Some progress can be reported on this issue, as
more CEOs are aware of the benefits of implementing corporate sustainability.
According to MIT Sloan’s 2012 Sustainability and Innovation Global Executive
Study, 48% of CEOs responded that they had changed their business model to
incorporate sustainability; of those, 46% reported that sustainability added to
their bottom line. However, out of 600 companies surveyed in 2018 by CERES
for The Road to 2020 Report, more than half still fell into the Tier 4 “Starting
Out” in their Roadmap for Sustainability. In Tier 4, CERES catalogs those
companies who are beginning to understand sustainability and which need
considerable work to integrate sustainability into overall corporate accountability
systems. Corporate sustainability demands a broad view of issues and impact, as
well as a working understanding of what the company does and how it does it.
Embedding sustainability means joining the two together through a series of
concrete steps.
2.5.1 Five Steps in Achieving Sustainable Corporate Strategy

Step 1: Understand sustainability and recognize what it means to the
company
As a first step, it is important to define what sustainability means for every area
in the company and to identify its benefits. From investment decisions, developing
new products or services to changing procurement practices, sustainability has
an increasingly central role in these decisions. Coca-Cola is one of the companies
centering its investment decisions on sustainability. When considering the
development and location of new production plants, water sustainability has been
now included as a key factor. Sanjay Guha, president of Coca-Cola, Great Britain,
says “Potential markets and ease of distribution were once the only key factors.
Now, it is the long-term supply of water.” In order to understand where
sustainability efforts should be concentrated in a company, it is necessary to
identify those issues that have the biggest impact and are most relevant to the
business and its stakeholders.
Step 2: Engage with Stakeholders

Depending on its line of business, a company’s impact can vary among
stakeholders. Generally, companies engage with the most influential groups,
keeping close ties and a constant dialogue. However, engagement can happen at
different levels and should respond to expectations from both sides. Different
35
Operationalizing CSR levels and methods of engagement bring benefits to both companies and
stakeholders and can be translated into more sustainable practices. Bonnie Nixon,
Director of Environmental Sustainability at Hewlett Packard explains, “Allowing
stakeholders to honestly critique us pushes us to improve our programs and helps
us develop our thought leadership platforms.” In the same way, Procter and
Gamble has benefitted through the engagement with local communities around
the world by finding alternative uses for its waste materials. Through employee
engagement, Kraft Foods has developed a model where employees contribute
with ideas and viable plans to reduce waste while helping to reach the company’s
waste reduction targets.
Step 3: Set Goals and Commitments

Once key environmental, social, and governance issues have been identified and
engagement methods for each stakeholder group have been defined, efforts must
focus on reducing risks and seizing opportunities around these issues centered
on sustainable practices. Whether driven by cost reductions, innovation or
improved financial performance, sustainability commitments and goals need to
be established.
For Wal-Mart, most of its commitments and goals on sustainability are focused
around the use of renewable energy and the adoption of energy efficiency.
Initiatives in these areas have resulted in the recognition of Wal-Mart as the
largest on-site green electricity generator in the U.S. and have led to cost savings
of over USD500m a year. Another example is United Airlines. The airline aims
to reduce its environmental impact through participation of all its suppliers in its
sustainable supply chain initiative.
While companies like Wal-Mart and United Airlines aim for a complete
transformation of their businesses, small companies are setting goals and
commitments according to their scope of action. Initiatives mainly focus on cost
reductions from energy use, waste management and commuting practices, as
well as social actions in the community like local development projects and
volunteering campaigns.
Step 4: Establish Systems and Processes

Once the goals are established, specific systems and detailed processes need to
guide the implementation of each initiative. Throughout the design, processes
and policies in place must be taken into consideration and collaboration among
areas encouraged. At this point, gaining executive commitment is crucial. The
appointment of an internal sustainability champion as the main driver of
sustainability and the development of a successful employee engagement model
are also good practices. According to the 2012 Report of Sustainability Leaders by
VOX Global and Net Impact, Berkeley, 78% of respondents said top management
was a key contributor to embracing sustainability. However, 81% identified their
colleagues across the company as primary drivers of success.
Unilever’s Sustainable Living Plan was launched in 2010. Under the leadership
of its CEO Paul Polman, this ten-year sustainability plan accomplished
considerable progress in its first two years. Under the umbrella of its
comprehensive overall sustainability strategy, Unilever is utilizing its wide array
of brands to target distinct social issues, invest in sustainable technologies and
36 change consumer behavior. Unilever has also accomplished to fully embed
sustainability across the company and to successfully engage external actors. Business Strategy in CSR
Besides the appointment of a Chief Sustainability Officer in 2012, the company’s
management structure includes a Sustainable Living Plan Steering Team, a group
of external specialists in corporate responsibility and sustainability known as
the Sustainable Development Group. It also launched the ‘Small Actions, Big
Difference Budget’ which finances employees’ ideas based on environmental
benefit and financial return.
Step 5: Track Progress, Communicate Actions and Meet Expectations

Lastly, it is important to set a system that measures the performance towards
each goal. Defining key performance indicators to meet the identified goals will
allow to detect areas for improvement and will gather relevant data to track
progress. Metrics and indicators are also central to the reporting and
communicating activities of the company. Internally, the availability of data
contributes to the prioritization of issues and initiatives and to promote employee
involvement around sustainability. Externally, collecting data is fundamental for
an accountability strategy, to respond to stakeholders’ expectations and interests
and to comply with reporting standards.
Companies reporting under the Global Reporting Initiative guidelines have

already embraced the development of indicators. In addition to these guidelines,
the Sustainability Accounting Standards Board is currently preparing frameworks
that will standardize sustainability key indicators per sector. Alongside these
efforts, companies are designing their own systems to measure performance,
like Wal-Mart’s Sustainability Scorecards, which, among other criteria, ranks
suppliers according to their environmental footprint and contributes to Wal-Mart’s
performance measurement.
In the end, corporate sustainability needs to adapt to the maturity of the business
and the company’s willingness to treat sustainability as a strategic opportunity.
These steps are only the beginning of a process that can eventually transform a
company’s entire business strategy into a sustainable business strategy.
2.5.2 Sustainability Risks and Challenges of the Corporates

Sustainability is an important business concept, however, there are some important
and significant risks that need to be addressed to make the business both
sustainable and profitable.
The sustainable marketing risks that corporates face can be classified as follows:
1) Market Risks
2) Operating Risks
3) Corporate Image Risks
1) Market Risks:
Studies show that there is a gap between the consumer’s green intentions and
their dedication to fulfilling these intentions. Cost continues to be the greatest
barrier that stops consumers from making sustainable purchases. Sustainability
comes with a price which may be either financial, effort or time. Sustainability
may make the society and environment better off while the individual is always
rendered worse off as they have to absorb the additional cost. A product being
37
Operationalizing CSR good for the environment may not be a reason good enough to convince the
consumer to bear the additional personal cost. Hence, the societal and personal
benefits of sustainability need to be made known to the masses. Thus, information
dissemination and educating the consumers are key to influence consumer’s
decision to choose sustainable products.
Thus, marketing risks with sustainability initiatives include:
i) Lack of consumer appeal for sustainable products in terms of their value,
convenience and efficacy.
ii) Lack of understanding and appreciation among consumer groups on the
benefits of sustainability.
2) Operating Risks
The operating risks associated with pursuing the sustainability initiatives include:
i) Decline in profitability.
ii) Loss of focus.
Even though adding sustainability to their corporate missions and adding green
elements to their products have given a competitive edge to some companies, a
company can lose on its profitability if it invests more of its financial and human
resources into sustainable initiatives without getting commensurate benefits. Thus,
in order to avoid loss of sales, market share or profitability, the pricing of products
should cover the additional cost incurred or the initiative should make the products
superior in the minds of the consumer thus giving it a competitive advantage.
Adding sustainability can also shift the focus away from profitability leading to
misallocation of critical resources.

The corporate image related risks include:
i) Negative greenwashing image
ii) Negative impact of an inconsistent action
Greenwashing
Environmentalist Jay Westerveld coined the phrase in his 1986 essay regarding
the hotel industry’s practice of using placards in each room to promote reuse
of towels to “save the environment.” He wrote that many hotels made little
effort toward energy use reduction. The principal goal of this activity was to
increase profits.
Since that time, the Federal Trade Commission (FTC) has put some parameters
into effect to help minimize greenwashing with its Green Guide, which was
first published in 1998 and revised again in October 2010. The FTC Green
Guide mandates that companies provide clear substantiation to any
environmental claims and that there is specificity surrounding these claims.
In particular, the FTC warns of using more generic terms such as “eco-friendly”
and “environmentally friendly” without documented and detailed evidence to
these claims. Failure to comply can cost a company up to $16,000 per false
claim.
Lee van der Voo, “FTC Takes a Swipe at Greenwashing,”
Source:http://www.sustainablebusinessoregon.com/articles/2010/10/new_ftc_rules_take_
38 swipe_at_greenwashing.html)
From the above box we can see that greenwashing or green marketing is giving Business Strategy in CSR
an incorrect impression that a company’s strategies and policies are designed to
be beneficial to the environment. This can have a negative impact on the
company’s image if it is discovered that the claims made by the company are
false.
Maintaining consistency and effective execution are as important as a company’s

commitment to sustainability. Even though a company may have a good name in
green initiatives due to its past action, it can still lose on its image if it is not
consistent.
Activity 2
Identify any one sustainable consumption item that would add additional cost
to a consumer. Ask five people if they would be willing to buy that product
against a cheaper non-sustainable substitute and note down your observation.
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Check Your Progress-2
1) What are the steps in achieving sustainable corporate strategy?
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2) Name the sustainable marketing risks that corporates face?

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39
2.6 LET US SUM UP
Strategic corporate social responsibility (CSR) involves the voluntary practice
of social and environment activities to satisfy firms’ stakeholders, with the
intention of generating profits.
Undoubtedly several NGOs, government organizations and Public-private

partnerships are the emerging communities taking voluntary initiatives for CSR
effectiveness in India but this is not possible without companies moving towards
strategic CSR. Businesses are known as the shapers of society and time has
come when businesses can prove it by their sustainable actions through strategic
CSR. This paves the way where strategic CSR can work as an element of
transformation, encompassing the complexity and tensions of the different and
intersecting dimensions of sectors, levels, and structures that provide the setting
within which CSR is negotiated.
Strategic CSR through sustainable actions provides real time customization rather
than without vision and spontaneous “good deeds” of the companies. CSR
initiatives need to be qualitative instead of quantitative.
2.7 KEYWORDS
Sustainable Development : For the business enterprise, sustainable
development means adopting business strategies
and activities that meet the needs of the enterprise
and its stakeholders today while protecting,
sustaining and enhancing the human and natural
resources that will be needed in the future.
Corporate Disclosure : Corporate disclosure can be defined as the

communication of information by people inside the
public firms towards people outside the main aim
of corporate disclosure is “to communicate firm
performance and governance to outside investors”
(Haely and Palepu, 2001).
ESG : ESG stands for Environmental, Social, and

Governance. There is growing evidence that
suggests that ESG factors, when integrated into
investment analysis and portfolio construction, may
offer investors potential long-term performance
advantages.
Risk Management : In business this refers to the forecasting and

evaluation of financial risks together with the
identification of procedures to avoid or minimize
their impact.
Stakeholder Relations : Effective management of relationships with

stakeholders is crucial to resolving issues facing
organizations. A stakeholder is any person, group
or organization who can place a claim on an
40
organization’s attention, resources or output, or is Business Strategy in CSR
affected by that output.
Sustainable Business : For businesses, sustainability is a powerful and

Strategies defining idea: a sustainable corporation is one that
creates profit for its shareholders while protecting
the environment and improving the lives of those
with whom it interacts.
Triple bottom line : The triple bottom line (or otherwise noted as TBL
or 3BL) is an accounting framework with three
parts: social, environmental (or ecological), and
financial. Some organizations have adopted the
TBL framework to evaluate their performance in a
broader perspective to create greater business
value. Business writer John Elkington claims to
have coined the phrase in 1994.

Articles
Elkington, J. (2018). “25 Years Ago I Coined the Phrase “Triple Bottom Line.”
Here’s Why It’s Time to Rethink It”, Harvard Business Review, 25 June 2018
Strategic Corporate Social Responsibility: Challenging Sustainable actions in

Indiahttp://www.indianmba.com/Faculty_Column/FC1397/fc1397.html
Haely, P.M. and Palepu K.G. (2001). Information asymmetry, corporate disclosure,
and the capital markets: A review of the empirical disclosure literature, Journal
of Accounting and Economics, Volume 31, Issues 1–3, September 2001, Pages
405-440
Books & Reports

“Triple Bottom Line”. The Economist. November 17, 2009. Retrieved 14
August 2014.
Bhattacharya D. and Milindo C. (2003). ‘Public Private Partnership in Re-

Greening of Degraded Revenue/ Private/Forest Land-Cost Benefit Analysis’,
CII, IIH-Ahmedabad, IFRI-Bhopal.
Slaper, Timothy F. and Hall, Tanya J. (2011). ”The Triple Bottom Line: What Is
It and How Does It Work?” Indian a Business Review. Volume 86, No. 1.
World Commission on Environment and Development (1987). Our Common

Future. Oxford: Oxford University Press. p. 27. ISBN 019282080X
Government Reports
Bhattacharya D. (2010). ‘Renewable Energy for Rural Livelihoods – An Industry-
led Public Private Partnership Model’, UNDP, CII, Ministry of New and
Renewable Energy, Govt. of India.
41
Operationalizing CSR Online Search
http://www.temple.edu/law/tjstel/2007/spring/v26no1-Mandelbaum.pdf accessed
on 15/11/18
www.pgsadvisors.com/2013/08/5-key-steps-to-a-sustainable-corporate-strategy/
accessed on 15/11/18
2.9 CHECK YOUR PROGRESS – POSSIBLE

ANSWERS
Check Your Progress – 1
1) A business strategy can be defined as the combination of all the decisions
taken and actions performed by the business to accomplish the business
goals and to secure a competitive position in the market.
2) Inspite of being one of the largest economies, 1/3rd of world’s poor reside in
India. It is a challenge that requires us to create employment opportunities;
improve the quality of human capital through education, skilling and training;
provide accessible healthcare; deliver affordable shelter; ensure food
security; and create institutions that are transparent, responsive and efficient.
Doing this requires companies to be inclusive in their approach of business
and pursue a ‘triple bottom line’ instead of being focused purely on their
financial results.
1) Steps in achieving sustainable corporate strategy are as follows:
Step 1: Understand sustainability and recognize what it means to the
company
Step 2: Engage with stakeholders
Step 3: Set goals and commitments
Step 4: Establish systems and processes
Step 5: Track progress, communicate actions and meet expectations
2) The sustainable marketing risks that corporate face can be classified as
follows:
1) Market Risks
2) Operating Risks
42
UNIT 3 CORPORATE GOVERNANCE AND
BUSINESS ETHICS
Structure
3.1 Introduction
3.2 Corporate Governance
3.3 Business Ethics
3.4 Approaches to Ethical Decision Making
3.5 Individual Ethical Decision Making
3.6 Importance of Corporate Ethics
3.7 Governance: Case Studies
3.8 Let Us Sum Up
3.9 Keywords
3.11 Check Your Progress- Possible Answers
3.1 INTRODUCTION
As the Indian economy becomes more industrialized and the corporate sector
continues to acquire an increasingly important profile, a number of issues continue
to spring into prominence. While ensuring growth is important, ensuring that it
takes place in an ethical, just and inclusive manner is even more important.
Corporate governance lies at the heart of the way businesses are run. Often defined
as the ‘way businesses are directed and controlled’, it concerns the work of the
board as the body which bears ultimate responsibility for the business.
The Oxford Dictionary defines ethics as “moral principles that govern a person’s
behaviour or the conducting of an activity”. When we add the word ‘corporate’
before ethics, we obviously are trying to ensure that the day-to-day conduct of
business concerns confirms to the existing norms of accepted behaviour. By
definition, ethics go beyond the rules of conduct laid down by laws etc. The Unit
focuses on various dimensions of the concerns that relate to corporate governance
and business ethics.
After studying this unit, you should be able to:
Explain the significance of corporate governance and ethics in business
Differentiate between ethics and law
List the essentials of good corporate governance
Discuss the approaches to ethical decision making
Explain the meaning and importance of corporate ethics
3.2 CORPORATE GOVERNANCE

Governance relates to how the board is constituted and how it performs its role.
It encompasses issues of Board composition and structure, the Board’s remit and
how it carried out different functions and the framework of the Board’s
43
Operationalizing CSR accountability to its stakeholders. It is also concerned with how the Board
delegates authority to manage the business throughout the organization. The words
‘Corporate Governance’ (CG) are buzzwords these days due to various corporate
failures the world over in the recent past. Corporate governance represents the
value framework, the ethical framework and the moral framework under which
business decisions are taken. In other words, when investment takes place across
national borders, the investors want to be sure that not only is their capital handled
effectively and adds to the creation of wealth, but that the business decisions are
also taken in a manner which is not illegal, or do not involve moral hazards
(Verma & Gupta, 2004). Corporate governance basically denotes adherence to
rule of law.
3.2.1 Elements of Good Corporate Governance

Good corporate governance is a formal system of accountability and control of
ethical and socially responsible decisions and the use of available resources. To
be effective, a company’s leaders must take responsibility for their decisions and
the performance of the organization as a whole. For example, the leaders of a
company should design and adhere to a code of ethics that helps management
promote each of the important characteristics of good corporate governance.
Corporate governance requires companies to develop and closely monitor
comprehensive and robust programmes and mitigate any number of possible
risk factors. Each company must eventually tackle corporate governance, and
unfortunately, there is no easy way to go about this. Corporate governance is a
complex and tiresome subject.
Corporate governance can overwhelm growing companies that are just beginning
to realize the importance of tackling this issue, which in the end becomes a full-
time job. The UK Corporate Governance Code, which guides many businesses,
states that the corporate board sets the values of the company, and this is very
different from running the business day-to-day.
Below are eight elements of good corporate governance:
1) Direction
Providing overall direction for the business, its leaders and employees is a major
part of corporate governance. Making strategic decisions and discussing current
and future concerns of the company are tactics of this element. Company mission
and vision statements stem from the governance role of business. These statements
provide a sense of purpose and illustrate primary motives for the company’s
business activities.
2) Independence of Directors
If the directors of a company are also the owners and/or their family members,
entrepreneurs appointed by friends, or individuals who are involved in the daily
management of the company, then the board is unlikely to be impartial. Having
a majority of non-executive independent directors would help avoid prejudice
and conflicts of interest between the board and the management. Independent
judgment is almost always in the best interest of the company.
3) Effective Risk Management

Even if a company implements smart policies, competitors might steal its
44 customers, unexpected disasters might cripple operations and economic
fluctuations might erode the buying capabilities of the target market. One can’t Governance and Corporate
Ethics
avoid risk, so it’s vital to implement effective strategic risk management. For
example, a company’s management might decide to diversify operations so the
business can count on revenue from several different markets, rather than depend
on just one.
4) Organization
A solid structure and organization within the company is essential towards fluidly
implementing and dispersing corporate governance objectives. Companies will
need to be able to monitor all of their dealings, interactions, and transactions
effectively. One of the fundamental objectives of corporate governance is for
companies to develop more transparent business practices, meaning a rigidly
structured framework through which it is possible to trace all such activities
efficiently.
5) Stakeholder Relations
Corporate governance encompasses a business’s accountability to each of its
stakeholder groups. Traditionally, this role has largely centered around investor
relations and communication of company decisions. Investors can often find
contact information of board members on company websites. In the early 21st
century, there is more emphasis on balancing investor interests with concerns of
other stakeholders, such as customers, employees and business partners.
6) Transparency
Managers sometimes keep their own counsel, limiting the information that filters
down to employees. But corporate transparency helps unify an organization.
When employees understand management’s strategies and are allowed to monitor
the company’s financial performance, they understand their roles within the
company. Transparency is also important to the public, who tend not to trust
secretive corporations.
7) Corporate Citizenship
Another major evolution in the early 21st century is increased focus on corporate
citizenship. Companies commonly include a corporate citizenship statement on
corporate governance or investor relationships web pages. Such statements
communicate the business’s intent to act with social and environmental
responsibility. Philanthropy and other charitable contributions are among common
things noted within corporate citizenship statements. In general, governance
includes awareness that companies should balance profit-generating activities
with responsible policies and practices.
8) Self-Evaluation
Mistakes will be made, no matter how well a company is managed. The key is to
perform regular self-evaluations to identify and mitigate brewing problems.
Employee and customer surveys, for example, can supply vital feedback about
the effectiveness of the company’s current policies. Hiring outside consultants
to analyze operations can also help identify ways to improve the company’s
efficiency and performance.
45
3.3 BUSINESS ETHICS
Business ethics are a kind of applied ethics. It is the application of moral or
ethical norms to business. The term ethics has its origin from the Greek word
‘ethos’, which means character or custom- the distinguishing character, sentiment,
moral nature, or guiding beliefs of a person, group, or institution. Ethics area set
of principles or standards of human conduct that govern the behaviour of
individuals or organizations.
Ethics can be defined as the discipline dealing with moral duties and obligations,
and explanation regarding what is good or not good for others and for us. Ethics
is the study of moral decisions that are made by us in the course of performance
of our duties. Ethics is the study of characteristics of morals and it also deals
with moral choices that are made in relationship with others. Business ethics
comprises the principles and standards that guide behaviour in the conduct of
business. Businesses must balance their desire to maximize profits against needs
of its stakeholders. Maintaining this balance often requires trade-offs. To address
these unique aspects of businesses, rules, articulated and implicit, are developed
to guide the businesses to earn profits without harming individuals or society as
a whole.
3.3.1 Difference between Ethics and Law

While law is obligatory and violation of law attracts penalties from the justice
system, ethics are more voluntary in nature. However, not acting ethically might
lead to violation of laws, as most laws are in one way or the other a codification
of ethics.
Business ethics can be said to begin where the law ends. Business ethics is
primarily concerned with those issues not covered by the law, or where there is
no definite consensus on whether something is right or wrong. Business ethics is
about the grey areas of business, where values are in conflict. In such scenarios,
there might not be a definitive ‘right answer’.
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Governance and Corporate
3.4 APPROACHES TO ETHICAL DECISION Ethics
MAKING
There are several approaches to ethical decision making. They are discussed in
brief in this section.
3.4.1 Teleology
Teleology is the belief that certain phenomena are best explained in terms of
purpose rather than cause. Teleological theories of ethics focus on the
consequences arising out of actions. There are two major classes of teleological
theories - egoism and utilitarianism.
i) Egoism
Egoism is the view that morality ultimately rests on self-interest. It defines right
and wrong in terms of the consequences to oneself. An egoist chooses a course
of action out of several available choices on the basis of what effects the chosen
action would have on his well-being. When faced with a business decision, such
a person would thus choose the course of action that he or she believes would
best serve his/her self-interest.
ii) Utilitarianism
Utilitarianism is the system of ethics according to which the correctness or
incorrectness of an action should be judged by its consequences. The goal of
utilitarian ethics is to promote the greatest happiness for the greatest number.
Jeremy Bentham, an English philosopher, was the founder of utilitarianism; John
Stuart Mill was its best-known defender.
The utilitarian approach can also be understood as a cost-benefit analysis. The

costs and benefits of a decision, a policy, or an action are compared. The costs
and benefits can be measured on any criteria such as economic, social, human,
or even emotional. When all the costs are added and compared with the results,
if the benefits outweigh the costs, then the action may be considered ethical.
Utilitarianism and egoism are similar in that both advocate judging actions by
their consequences. However, unlike egoism, utilitarianism is concerned with
ensuring the greatest good for the greatest number of people.
3.4.2 Deontology
The word deontology originates from the Greek words for duty (deon) and study
(logos). As opposed to the teleological theories, deontological theories focus on
the morality of the means and not on the ends.
A deontological approach to decision making would, thus, not allow harming
some individuals in order to help a larger number. To the deontologist, each
person must be treated with the same level of respect and no one should be
treated as a means to an end.
3.4.3 Justice
Justice implies fairness. Justice-based theories of ethics are concerned with
determining the fairness of actions. Under this approach, any action that is fair to 47
Operationalizing CSR all affected parties and is in consonance with existing ethical or legal standards,
is a just action.
Fairness of an action is often judged on three grounds–distributive, procedural

and interactional. Each of these is briefly described below.
1) Distributive Fairness
Distributive fairness judges the outcomes of actions and perceptions of these
outcomes that the parties affected by these have of them.
2) Procedural Fairness
Procedural fairness deals with the processes (for example: policies, procedures,
rules, etc.) that are employed to reach decisions. Under this approach, the fairness
of processes as well as outcomes of these processes is determined.
3) Interactional Fairness
This dimension of fairness is concerned with the treatment one receives in the
administration of a decision making process. Basically, this deals with the respect
and consideration shown towards the affected parties while taking decisions. It
also deals with the explanations and justifications provided for the decisions.
3.4.4 Relativism
As opposed to the approaches discussed so far, all of which are based on the
premise that principles of morality that are permanent and universal in nature,
relativism states that there are no universal principles of ethics and that right and
wrong must be determined by each individual or group. It thus takes into
consideration differences in morality across time and cultures.
Activity 1
If a manufacturer chooses to produce its products in countries that have non-

existent labour laws, will its action be considered ethical? Why?
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48
Check Your Progress - 1 Governance and Corporate
Ethics
1) Define corporate ethics.
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2) Differentiate between ethics and law.

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3.5 INDIVIDUAL ETHICAL DECISION MAKING

The most popular model of ethical decision making was developed by James
Rest (Rest, 1984) and is called the four-step or four-stage model of individual
ethical decision making.
The four stages of decision making, as proposed by the model are:
i) Ethical Issue Recognition

This is the first stage in the ethical decision-making process. In this stage, an
individual identifies a situation and the ethical issues involved therein.
ii) Ethical Judgment

In the second stage of the process, after having identified the ethical issues
involved, an individual would form a normative opinion about the rightness or
wrongness of the issue.
iii) Ethical Intent

In the third stage, having identified the ethically correct courses of actions open
to him/her, the individual decides what he or she will do (or not do) in regard to
the perceived ethical dilemma. Research indicates that individuals do not always
form intentions in accordance with their judgments, as various situational factors
may act to influence the individual otherwise. 49
Operationalizing CSR iv) Ethical Behaviour
This is the final stage of the decision-making process. Having identified the
ethical issues involved, the ethically acceptable choices open and having formed
an intent to behave in a particular way in the earlier three stages, the individual
finally carries out his/her intent and acts in a particular manner.
3.5.1 Difficulties in Identifying the Scope of Ethics in Business

Businesses have to align their values and mechanisms to standards acceptable to
not only their shareholders, but also to their customers, business partners,
regulators, government and the community at large. Thus, the narrow theoretical
view that seeks to limit all business activity to maximizing shareholder wealth is
impracticable at best.
Similarly, the broader view that seeks to judge all business activity through an
ambiguously defined test of morality is also defective as morals by definition
are subjective and also dynamic. When the values of consumers and employees
change and when a shared consensual culture is replaced by a more heterogeneous
one, it is no longer possible to rely on implicit understandings.
Given the difficulties involved in identifying the scope of ethics in business, it is

better to establish a written code of conduct that governs business practices in
different scenarios. Unless business ethics are aligned to broader perceptions of
ethical conduct, problems are bound to arise. Additionally, in a culturally fluid
environment, a formal code of ethics is as essential as codes governing decision
making in other dimensions such as financial transactions. However, at the same
time, such a code of ethics needs to be both sophisticated and flexible, in order to
be effective in handling different ethical dilemmas a business is likely to face
across time, cultures and geographies.
Table 1.1 summarizes important ethical issues confronted by businesses from

the 1960s onwards (adapted from Ferrell et al 2006)
Table 1.1: Important Ethical Issues Confronted by Businesses
1960s 1970s 1980s 1990s 2000s

Environmental Employee Bribes and Sweatshops Cyber
issues militancy illegal and unsafe crime
contracting working
practices conditions in
Third World
countries
Civil rights Human rights Influence Rising Financial
issues issues peddling corporate management
liability for
personal
damages
Increased Covering up Misleading Financial International
employee- of ethically advertising mismanagement, corruption
employer questionable fraud
tensions actions
50
Honesty - Financial fraud - Loss of employee Ethics
privacy
Changing work - Transparency - Intellectual property
ethics issues theft
Rising drug use - - - -
Although Table 1.1 lays out the issues from the perspective of American business
history, many of the concerns highlighted above hold true for the Indian business
environment as well. Questions such as privacy at the workplace, intellectual
property theft, corruption and financial mismanagement are equally important
in India as in rest of the world.
3.6 IMPORTANCE OF CORPORATE ETHICS

3.6.1 Why Corporate Ethics Matter?
Ethics matter because ethical conduct is the right conduct. However, in the absence
of a time- culture, and context-neutral definition of ‘right’, it is very difficult to
develop a code of conduct on this basis alone. It basically says that businesses
avoid many risks and gain reputation by acting in an ethical manner.
A good ethics process, operationalized in such a way that all decision making
procedures and structures support it on a day-to-day basis, will give an
organization the best chance possible for finding out about potential problems
early so that they can be dealt with before they become a disaster. There are also
market advantages to be gained from an ethical reputation.
3.6.2 Ways in which Ethics are Important

Major scandals such as WorldCom, Enron, Lehman Brothers etc., in the US and
Satyam in India tell us why ethical business practices are becoming increasingly
important. There are several reasons why ethics are important to business:
1) To understand reasons behind increasing influence of corporates in society.
2) To ensure that no harm is done to society.
3) To meet ethical expectations more effectively.
4) To enable companies to identify employee and customer concerns at an
early stage.
5) To improve the quality of a firm’s relationships with its key stakeholders.
6) The government is interested in ensuring ethical business practices to ensure
a basic level of integrity in the marketplace. This promotes international
competitiveness of the economy and improves a country’s image concerning
ease of doing business.
7) Even domestically, predictable levels of ethical behaviour ensures that costs

of business such as transaction costs, hedging and insurance etc., are kept
to a minimum.
8) Unethical behaviour imposes costs on the government and taxpayers. Bad

behaviour by a few impacts on all businesses and might also have an adverse
impact on the country’s international competitiveness. 51
Operationalizing CSR 9) Ethics can help improve decision making by providing managers with the
appropriate knowledge and tools that allow them to correctly identify,
diagnose, analyse, and provide solutions to the ethical problems and
dilemmas they are confronted with.
10) Ethics help in analysing the reasons behind this, and the ways in which
such problems might be dealt with by managers, and regulators in improving
business ethics.
11) Business ethics can provide us with the ability to assess the benefits and
problems associated with different ways of managing ethics in
organizations.
12) Business ethics also equips us with knowledge that goes beyond the
traditional boundaries of business studies.
Activity 2
Illustrate a business case in which ethical practices have created a strong

public image for the corporate.
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3.7 GOVERNANCE: CASE STUDIES

Understanding ethical behavior in the context of corporate governance requires
two levels of analysis: the internal concerns of corporate agency and the emergent
effects on social welfare.
Corporate agency is based on the premise that employees, managers, and

directors (i.e., agents) should behave in the best interests of owners or shareholders
(i.e., principals). Two things get in the way of that ideal:
First, managers’ interests, while overlapping with those of shareholders,

are distinct. Sometimes agents can help themselves in ways that hurt the
firm and its shareholders. Examples include shirking, waste, and in extreme
cases, fraud or other self-serving actions that can bring down the company,
as have happened in numerous business scandals.
Second, shareholders have neither the specific knowledge nor skills

possessed by management. This can create dynamics where even well-
intentioned managers may feel compelled to ‘short-termism’, i.e., acting
in ways that look good to shareholders now, but actually undermine value
creation over time. Various oversight, transparency, and incentive
mechanisms have evolved, and continue to develop, to contain agency
costs.
52
Social welfare is based on the premise that companies should engage in fair Governance and Corporate
Ethics
dealing with all of their stakeholders—including customers, employees, suppliers
and communities, as well as shareholders—in accordance with the expectations
of the larger society in which they operate. The debate about what is ‘fair dealing’
reflects the larger, ongoing debate about the purpose of corporations in society,
but even a shareholder-centric model recognizes that companies benefit from at
least nurturing their reputations among all stakeholders, and that minimizing
their negative externalities (pollution, plant closures, etc.), preserves the freedom
of companies to operate with otherwise minimal external constraints.
While traditional corporations are expected to prioritize shareholder interests

above those of other stakeholders and, to a considerable extent, attempt to
maximize shareholder value within their legal constraints, other corporate forms
permit a more balanced approach between shareholders and vendors
(cooperatives) or between shareholders and specified other constituencies (B-
corporations).
*Certified B Corporations are businesses that meet the highest standards of

verified social and environmental performance, public transparency, and legal
accountability to balance profit and purpose.
CASE STUDIES
FAILURES
The Enron Scandal (Hodak, 2007): How a combination of perverse incentives
and lack of transparency killed a highflying company?
Enron’s collapse is generally viewed as a morality tale - the natural result of

managerial greed, a clueless board, and feckless gatekeepers. It is a tale of how
bad bets that resulted in good outcomes came to be viewed by top management
and the board as bets kept repeating on an ever-larger scale. Early success in
highly risky ventures were ramped up and duplicated, under perverse incentives,
into a financial disaster. The firm then doubled down on that disaster with non-
economic hedges developed by the finance group. The CFO (Chief Financial
Officer), in a wholesale breach of his fiduciary responsibilities, including
corruption of various gatekeepers, managed to cloak the poor quality of his hedges
and his motivation in creating them. This duplicity prevented top management
or the board from fully recognizing or acting upon the danger that those hedges
posed to Enron’s survival, until it was too late. The political and economic
reactions to Enron are usefully viewed in terms of these distinguishing elements
of its failure.
SUCCESSES
Progressive Insurance: Disclosure Strategy (Hutton Weber, 2001): How they won
by not playing “the earnings game.” An excellent example of voluntary disclosure
yielding a competitive advantage.
Progressive Insurance had refused to play Wall Street’s earning game. Progressive
didn’t manage reported earnings nor did management give guidance to analysts.
Management then considered taking their unique disclosure strategy one step
further to become the first to move to monthly reporting of operating results.
Significant benefits had accrued from Progressive’s refusal to play the earnings
game. Management’s time wasn’t wasted manipulating reported results or talking 53
Operationalizing CSR to analysts and reported numbers didn’t mislead internal or external decision
making. However, there were significant costs, as well. Unguided analysts’
forecasts were often well off the mark, causing Progressive’s stock price to
fluctuate widely around quarterly earnings announcements. Analysts’ forecasting
abilities seemed to be getting worse - during four consecutive quarters in 1999-
2000, management felt compelled to give mid-quarter warnings that earnings
would fall significantly below the First Call’s consensus estimate. To eliminate
the need for such mid-quarter warnings, management considered moving to
monthly reporting of operating results. With this data, analysts presumably would
be able to update their forecasts. Management must decide if the release of
monthly results would give competitors information to use against Progressive,
and if the release of monthly results would increase or decrease Progressive’s
stock price volatility.
1) What are the four stages of decision making?
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2) Define corporate ethics. Why do ethics matter?

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3.8 LET US SUM UP

Questions of ethics, or the right way to run a business, are inherent in all aspects
of corporate governance and in every Board decision and action. Ethical choices
are relevant within the core business strategies that Boards pursue and the way
that direct the business as a whole to achieve them. Ethics is the first line of
defense against corruption while law enforcement is remedial and reactive. Good
corporate governance goes beyond rules and regulations that the government
can put in place. It is also about ethics and the values which drive companies in
the conduct of their business. It is therefore all about the trust that is established
over time between companies and their different stakeholders. Good corporate
governance practice cannot guarantee no corporate failures. But the absence of
such governance standards will definitely lead to questionable practices and
54
corporate failures which surface suddenly and massively. In making ethics work Governance and Corporate
Ethics
in an organization it is important that there is synergy between vision statements,
mission statements, core values, general business principles and code of conduct
confers a variety of benefits. An effective ethics programme requires continual
reinforcement of strong values. Organizations are challenged with how to make
its employees live and imbibe the organization’s codes and values. To ensure the
right ethical climate, a right combination of spirit and structure is required.
3.9 KEYWORDS
Corporate Governance : Corporate governance represents the value
framework, the ethical framework and the moral
framework under which business decisions are
taken.
Code of Ethics : A code of ethics document may outline the mission
and values of the business or organization, how
professionals are supposed to approach problems,
the ethical principles based on the organization’s
core values and the standards to which the
professional is held

Books & Reports
Fernando, A.C. (2011). Corporate Governance: Principles, Policies and
Practices. Pearson Education India
Bhattacharya D. (2015). Encoded Ethics-Social Responsibility of Indian

Businesses. Akansha Publishing House
Mallin C. (1998). The role of Institutional Investors in Corporate Governance of

Financial Institution: The UK Case. In Balling M., Hennessy, E. and O’Brien, R.
(Ed.), Corporate Governance, Financial Markets and Global Convergence.
Springer
Taxmann (2015). Corporate Governance. Taxmann Publication
Dube, I. (2008). Corporate Governance. Butterworths Wadhwa
Carver, J. (2002). On Board Leadership. John Willey and Sons
Sampath, K.R. (2006). Law of Corporate Governance: Principles and perspective.
Snow White. Publications Pvt. Ltd.
Sharma P.V. and Rajani, S. (2007). Corporate Governance: Contemporary Issues
and Challenges. Kanishka Publishers.
Aggarwal, s. (2003). Corporate Governance: Concepts and Dimensions. Snow
White Publications
SRI (1992). Survey on Corporate Philanthropy. ActionAid, New Delhi
Sundra, P. (2000), Beyond Business: From Merchant Charity to Corporate
Citizenship. Tata McGraw-Hill, New Delhi
55
Operationalizing CSR Online Search
https://hbr.org/product/progressive-insurance-disclosure-strategy/102012-PDF-
ENG accessed on 15/11/18
Nucor Corporation (A) (Govindarajan1998)http://www.tuck.dartmouth.edu/

people/vg/site/downloads/casestudies/20015_Nucor_A.pdf.
Government Reports
Bhattacharya D. (2012). ‘Developing Code of Ethics for Indian Industry’, (http:/
/nhrc.nic.in/Documents/reports/misc_dev_code_of_ethics_ for_ indian_industry_
ICSM.pdf)
https://www.ripublication.com/gjmbs_spl/gjmbsv3n10_08.pdfGovernment of
India.
3.11 CHECK YOUR PROGRESS- POSSIBLE

ANSWERS
1) Ethics is “Moral principles that govern a person’s behavior or the conducting
of an activity”. When we add the word ‘corporate’ before ethics, we
obviously are trying to ensure that the day-to-day conduct of business
concerns confirms to the existing norms of accepted behavior. By definition,
ethics go beyond the rules of conduct laid down by laws.
2) While law is obligatory and violation of the law attracts penalties from the
legal justice system, Ethics are more voluntary in nature. However, not
acting ethically might lead to violation of laws, as most laws are in one
way or another a codification of ethics.
1) The four stages of decision making, as proposed by the model are: Ethical
Issue Recognition, Ethical Judgment, Ethical Intent, and Ethical Behaviour
2) Corporate Ethics or Business Ethics has been defined as The study of

business situations, activities and decisions where issues of right and wrong
are addressed. (Crane and Matten: 2010). According to another definition
“Business Ethics comprises the principles and standards that guide
behaviour in the world of business” (Ferrell et al 2006).
Ethics matter because ethical conduct is the right conduct. However, in the
absence of a time, culture, and context-neutral definition of ‘right’, it is
very difficult to develop a Code of Conduct on this basis alone. It basically
says that businesses avoid many risks and gain reputation by acting in an
ethical manner.
56
MEDS-052 Ethics
CSR PROCESS
Block
2
CSR CULTURE AND DIVERSITY
UNIT 1
Employer Perspective
UNIT 2
Employee Engagement
UNIT 3
Entrepreneurship and Welfare
UNIT 4
Rehabilitation and Resettlement
57
CSR Culture and Diversity
BLOCK 2 CSR CULTURE AND DIVERSITY
Block 2 CSR Culture and Diversity consists of four units.
Unit 1: Employer Perspective discusses the concept of leadership, the roles and
responsibilities of a leader, CSR and leadership and it also gives examples of
how effective leadership has led to effective CSR. It also discusses the role of
HR in CSR and the importance of training and development. It also talks about
how the employee’s performance appraisal can be linked to their involvement in
CSR commitments of the company.
Unit 2: Employee Engagement discusses the concepts of employee engagement

and corporate branding and also about the relationship between the two. It also
discusses the connection of these two concepts with CSR.
Unit 3: Entrepreneurship and Welfare discusses entrepreneurship and social

enterprise model. It also discusses human rights, social exclusion, various types
of exclusion, importance of social inclusion. It also discusses how welfare leads
to economic growth.
Unit 4: Rehabilitation and Resettlement discusses various issues related to

rehabilitation and resettlement. It also discusses the various steps involved in
formulation and implementation of R&R plan. Integration of CSR and R&R is
also discussed.
58
UNIT 1 EMPLOYER PERSPECTIVE
Structure
1.1 Introduction
1.2 Leadership in CSR: As an Employer
1.3 HR Mapping in CSR
1.4 Training and Development of Employees
1.5 Performance Appraisal by Employer
1.6 Let Us Sum Up
1.7 Keywords
1.9 Check Your Progress - Possible Answers
1.1 INTRODUCTION
Business organizations are expected to create wealth, create market, generate
employment, innovate and produce a sufficient surplus to sustain their activities
and improve their competitiveness. On the other hand, society is expected to
provide an environment (resources, i.e., people, raw materials, services and
infrastructure) in which business can develop and prosper. Therefore, business
depends on society for its survival and long-term prosperity.
Corporate Social Responsibility is a not a new concept for India wherein-
Corporate – means organized business
Social – means everything dealing with people
Responsibility – means accountability between the two (i.e.,
corporate and society).
It means undertaking all actions as would maximize the probability of long term
survival and sustained growth of a business house. The term ‘Corporate Social
Responsibility’ is often used interchangeably with corporate responsibility,
corporate citizenship, social enterprise, sustainability, sustainable development,
triple-bottom-line, corporate ethics, and in some cases corporate governance. As
far as the corporate is concerned, an important parameter characterizing a good
corporate is its responsibility towards its employees. In this unit we shall discuss
the employer’s perspective of CSR. After reading this unit you will be able to:
Discuss the essentials of good leadership
Explain the role of good leadership in effective CSR
Discuss the role of HR in fostering CSR
Describe strategies to develop workplace talent
1.2 LEADERSHIP IN CSR: AS AN EMPLOYER

CSR is mainly about commitment to moral values, ethical conduct of business,
responsible exercise of power, transparency and regular monitoring of
performance. Leadership involves developing and communicating a vision,
59
CSR Culture and Diversity making wise decisions in short term for better future, motivating and inspiring
the followers/employees, treating all stakeholders equally and creating an ethical
and social culture within the organization.
Leadership and CSR are two separate issues but we can’t have one without the
other. Leadership as a process shapes the goals of a group or organization,
motivates behavior towards the achievement of those goals, and helps define
group or organizational culture. It is primarily a process of influence. Nowadays,
leaders are facing economic, social and environmental challenges. In this complex
global environment of uncertainty and ambiguity, leaders have to anticipate the
changes and to be catalysts for shifting their organizations towards building a
sustainable society. In order to create and maintain sustainability, intersection of
leadership and ethics is a must. Such ethics commonly known as business ethics
or corporate ethics refer to the application of ethical principles to business
relationships and activities, thus, governing the way a business runs. Leadership
has a vital role in promoting ethical behavior and inspiring an organization to
work for social responsibility. Many corporate scandals in India and abroad have
taken place due to fraud, lack of transparency, inadequate disclosures, unethical
business conduct and behavior by their leaders. Therefore, leaders should always
strive for maintaining an organization which works not only for earning profit
but also equally for promoting its social responsibilities.
In the CSR context, it is well-recognized that several projects are headed by

corporate leaders, therefore leadership structures clearly matter for CSR – and
neglecting these, runs the risk of CSR failing. Leadership is an important approach
for successful CSR implementation. We must educate our leaders to be ethical,
re-appraise the misguided nature of valuing material goods in place of human
beings and the environment, and create a worldview which embraces sustainability
and global justice. Once we do that, everything else will be easy. A leader’s
characteristics and behavior play an important part in the creation of CSR. A
focus on individual traits (e.g., personality) and perceived behaviours and
leadership styles describe the leader’s role at the individual level of analysis.
1.2.1 Leadership Defined

Leadership is defined as the ability to influence a group of employees’ values,
beliefs, attitudes and behaviour. A leader with strong leadership skills can easily
motivate and influence the employees of the organization and apply effective
changes to the organization. According to Atkinson, if there is no effective
leadership in an organization no changes will be made, because there are no
leaders that motivate and lead the organization’s employees as well as provide a
clear direction for the organization.
1.2.2 Essentials in Leadership

a) Trust
Trust is an essential issue in leadership, as gaining the trust of group members or
employees could help to improve the overall performance and commitment of
the employees. If the employees or the group members trust their leaders, it
reflects that they are good, effective leaders. Only when the employees place
trust in their leader will then change be brought about, because people will only
follow a person that they trust to lead them to the correct path; not a leader that
60
only talks but without action to back up their words. If the employees trust their Employer Perspective
leader, this relationship will bind them together and improve the overall
performance and commitment of the employees; if it happens conversely, the
performance and commitment of employees will go downhill and could cause
high employee turnover rate in the organization.
b) Organizational Culture Leadership

It can shape a good culture. A culture is shaped with the trust between employees
and leaders of an organization. Employees and leaders in the organization need
to trust each other in order to shape a positive organizational culture. Leaders
with strong leadership skills are able to shape a positive culture in the organization,
due to which they are able to inspire trust in their employees. A positive
organizational culture not only improves performance, but also influences
behavior and attitude of employees in the organization for the better. In addition,
it motivates employees and gives them a sense of belonging to the organization,
which inspires loyalty and commitment to the company. A good organizational
culture not only improves the performance and reduces the turnover rate of the
organization, it also facilitates the solution of internal issues in the organization.
When a good organizational culture is established, that does not discriminate
based on races, religions etc. It provides a pleasant environment to work in,
thereby reducing internal conflict and encouraging discussion and cooperation
in order to work through any inter-employee issues that crop up. In addition,
good organizational culture encourages a sense of healthy competition, motivating
employees in the organization to be more innovative. Therefore, a strong
organizational culture can change the overall performance of the organization.
c) Learning
An effective leader can encourage employees in the organization to learn using
certain types of motivators, such as rewards or position. Continuous learning is
one of the ways to improve the overall performance of the organization. It is not
only the employees that need to improve but all segments of the leadership levels
of an organization, if only to set a good example to the bottom line to motivate
them to learn. Leaders should join leadership training programmes in order to
strengthen their skills and knowledge, making them more effective in their
strategies and execution. The same goes for employees, as sending employees
for further training will improve their ability to do their job as well as help to
facilitate the effective implementation of the desired changes. This helps the
organization to increase the productivity and performance of the employees. Since
learning does not have an end, leaders need continuous improvement of their
leadership skills and knowledge to be competitive in the business market
nowadays. If an organization or leader stops improving and as a result find that
their skills and knowledge are insufficient, their company will surely find itself
deteriorating. The organization, Nokia, is a very good example. Nokia was once
one of the best cell phone brands in the world, but Nokia did not continuously
improve their skills and make changes in order to adapt to the new trends and
needs of the market, and Nokia dropped from being one of the best to a brand
that not many people pay attention to.
d) Teamwork
Besides strengthening their leadership skills, leaders also need to encourage the
employees of the organization to be innovative and cooperative. Teamwork and
61
CSR Culture and Diversity communication are the best ways to create innovative ideas in order to produce
the best outcome for the organization. To achieve the kind of teamwork and
rapport that is necessary for the birth of innovative ideas, leaders need to cultivate
a positive culture where the employees trust each other, are allowed to do their
own jobs without too much interference and have the freedom to establish a
dialogue with one another. Leaders that wish to facilitate effective change in the
organization should encourage employees to collaborate and communicate with
each other, for this is how people are able to create and discover new ways to
think, which produces a greater outcome for the organization and also encourages
them to learn from different people the ways to improve themselves. Even high
ranking management can learn from the strong points of their employees, which
they might find themselves lacking. Communication helps people to get to know
each other, and also could help to create more new ideas by sharing opinions
with each other. It is also one of the best ways to gain each other’s trust and bond
the whole employees in the organization together.
Lastly, leadership not only influences the employees in the organization, but
also provides a clear direction to the employees according to the organization’s
vision and mission. Effective leaders set strategies to help the employees to
achieve the company’s target and objectives. Leader also plays a role in monitoring
the direction of the employees to make sure the employees are on the right path
to achieve the goals according to the strategies. This is only possible with effective
leadership that inspires employee trust, as employees are unwilling to follow
someone who has little to no idea of what they are doing and who waste too
much time and resources on the unnecessary. Effective leadership plays an
important role in managing a business in the current business environment, for
the old ways of business management are not enough to sustain a company in the
modern market.
Although leadership and management are two completely different systems, an

organization might be surprised to find that there is no one system that completely
suits their needs, so it advisable that they focus on the skills that are suitable for
their organization. Management is a system that is based more on planning,
budgeting and controlling. The organization emphasizes on following the plan
that is set by the upper rank executives in the organization, and following their
orders to solve problems. Leadership focuses more on guiding the employees,
leading them in the desired direction, according to the organization’s vision and
can facilitate change in organizations through improvement and innovation
missions while communicating with and motivating them to complete their tasks.
Under leadership, the boss guides and works together with their employees to
produce their desired outcomes.
Old style management orders employees to follow directives while the upper
management is focused on planning and both are separate and do not work
together. Besides that, the current business environment requires organizations
to make changes in order to keep up with the rapid changes in the business
environment. If the organization fails to make changes in order to adapt to the
market they will fail to survive and will face bankruptcy. Leadership is in charge
of providing a clear vision and a systematic way to effectively achieve that vision,
for if there is no leadership, there is no change in organization’s management.
Although leadership can bring lots of changes and increase the organization’s
performance, but in reality, there are more factors to consider that might affect
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the possibility of the changes to occur. Every employee’s behavior and attitudes Employer Perspective
are different, some employees might be able to easily adapt to the change but
some will resist the change; some might accept the ways of their leaders and
learn from the action of their leaders but some will become jealous of their leaders
and refuse to cooperate. This would drag the performance of the organization
down. Effective leadership is the best way to manage changes though it must be
remembered that there are no problem solving solutions that are perfect and that
issues will still be faced that cannot be fixed.
Effective leadership is essential in managing change and change is the only method
to sustain the organization in the current business environment. As usual, change
is hard for people, people will feel uncomfortable because of change and even
sometimes deny the change, continue as they are and be eliminated by the society.
Therefore, leadership can be a factor to motivate and encourage people to
continuously make change and push them to change. Leadership plays a role in
an organization to motivate and encourage the employees to change in order for
the organization to be able to sustain and adapt to the business environment, to
make sure the organization will improve and be innovative.
Effective leadership skills can help leaders to gain the trust of employees, making
other tasks easier to operate because the employees trust their leaders. This could
make other parts of business management easier too, such as shaping the culture
in an organization. A positive organizational culture can bring lots of benefit to
the organization, as the positive culture can encourage and motivate the employees
in the organization to learn, communicate and work with one another. A good
culture in the organization not only provides a good working environment for
their employees, but also gives a sense of belongingness to the employees and
increases the commitment of employees to continue working in the organization.
Innovative ideas will be produced when leadership motivates the employees to
communicate with one another and share their thoughts. Leadership skills also
enable the leaders to lead their employees in the right direction, in accordance to
the organization vision and mission. When an organization’s leader leads the
employees in the correct direction and motivates them to continuously improve
and innovate, the organization’s performance will surely increase and be able to
sustain the organization in the current complex business environment. Hence,
effective leadership is the main factor that brings change to the organization, if
there is no leadership in the organization there will be no change at all.
1.2.3 Leadership Roles and Responsibilities

Managers have people to work for them. Leaders, on the other hand, have people
to follow them. So, they need to juggle roles like being a trustworthy captain and
acting as an effective communicator.
The actual duties and responsibilities of leaders vary slightly by the company for
which they work and might seem endless like:
Training new workers
Providing clear, constructive communication
Encouraging the team to work together to benefit the company
Listening to feedback and resolving conflict
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CSR Culture and Diversity Empowering each member to see his own potential and to grow within the
company
Complimenting good behaviour
Recognizing ineffective methods or practices
Correcting bad habits
Monitoring team members without micro-managing them
Developing timeliness to reach goals
Setting examples
Being an inspiration
Making work interesting and even enjoyable
Rewarding jobs well done
Taking responsibility for ineffective outcomes
Adapting to company changes and policies
Essentially the job description of a leader consists of several vital roles and
responsibilities as well as skills. Therefore, a leader who can pull the team together
to complete goals while encouraging an open-communication culture is a valuable
asset to any company.
Activity 1
Talk to four people working in the corporate sector and ask them what they
think are the most important characteristics/traits in a leader. Write down their
responses.
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1.2.4 CSR Leadership

Leadership is a very complex concept. Keith Grint considers that “Leadership,
or the lack of it, seems to be responsible for just about everything these days”.
Over time, many definitions have been developed and there is no consensus on a
universally agreed definition. There are “almost as many definitions of leadership
as there are persons who attempted to define the concept”. In order to build a
sustainable world, intersection of leadership and ethics is a must. Leadership has
a vital role in promoting ethical and moral behaviour. Moreover, leaders should
be models for followers and should aim to shape organizations by their own
values and characteristics. Employees rely on their leaders for guidance when
faced with ethical dilemmas. Leaders’ behaviour should be “Visible and
consistently ethical, both internally and externally to the organization”. Moreover,
“excellent companies do more than talk ethics, they take positive steps to address
ethical issues and apply the practical tools of ethics in their management practice”.
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Ethics has “A central role in the practice of leadership”. Nowadays, there is a Employer Perspective
higher need for ethical leaders and transparency in business processes. The role
of Corporate Social Responsibility (CSR) is “To restore one of the most critical
resources for businesses’ sustainability: trust.” Companies choose to incorporate
CSR into their businesses for different reasons. It is important to “distinguish
between activities for gaining popularity and those which gain trust”. Trust, ethics,
CSR and leadership are interlinked. Nowadays, “Too often, executives have
viewed corporate social responsibility (CSR) as just another source of pressure
or passing fad”. Corporate Social Responsibility is an ethical framework. Leaders
and organizations engaged in CSR act for the benefit of their stakeholders –
employees, customers, suppliers, community and society at large. CSR requires
the use of non-coercive influence and “soft power” which again are specific to
leadership. Leaders have a crucially significant role in adopting and practicing
CSR in their organizations.
A CSR leader is someone who inspires and supports action towards a better
world. CSR leadership is not a separate school of leadership, but rather a particular
blend of individual leadership characteristics applied within a definitive context.
Key characteristics of CSR leadership are:
Systematic understanding
Emotional intelligence
Values orientation
Compelling vision
Inclusive style
Innovative approach
Long term perspective
1.2.5 Case Studies on How Effective Leadership has Led to

Effective CSR
1) Using IBM integrated solutions, Cosco, a global shipping firm in China,
reduced its distribution centers from 100 to 40, lowering its logistics costs
by 23% and its CO2 emissions by 15%. Samuel J. Palmisano, the then
CEO, emphasized that the most important factor in achieving this kind of
progress is not technology, it’s leadership.
2) CEO Johan Karistrom of Skanska believes, “What is green today will be

vanilla tomorrow. To be a leader you have to aim for deep green.” For
Skanska, this meant taking bold action. The company uses carbon foot
printing tools to benchmark the carbon emissions of building projects and
to help identify low carbon project options.
3) NESTLE’s leadership tends to work for creating shared value in respect of

water, nutrition and rural development, environmental sustainability,
compliance of laws, business principles and codes of conduct.
4) TATA’s leadership provides ground breaking solutions to large- scale

societal problems. It aims at community improvement programmes,
provides disaster assistance, etc.
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CSR Culture and Diversity 5) ITC’s leadership endorses education, delivers precautionary healthcare,
supports countryside progress, aims at delivering hygiene and drinking
water, making livelihoods for people, etc.
1) What do you understand by leadership?
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2) What are the key characteristics of CSR leadership?

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1.3 HR MAPPING IN CSR

Human resource management is a set of policies, practices and programmes
designed to maximize both personal and organizational goals. It is the process of
binding people and organizations together so that the objectives of each are
achieved.
Human resource professionals have a key role to play to help a company achieve
its CSR objectives. Employee involvement is a critical success factor for CSR
performance. Human resource managers have the tools and the opportunity to
leverage employee commitment and engagement in the firm’s CSR strategy.
Employees prefer to work with organizations aligned with their values. Human
resource management ensures that what the organization is saying publicly aligns
with how people are treated within the organization. HR provides the tools and
framework for the executive team and CEO to embed CSR ethics and culture in
the strategic framework of the organization.
It is the only function that influences across the entire enterprise for the entire
lifecycle of the employees who work there- thus, it has considerable influence if
handled correctly. HR is poised for this lead role as it is adept at working
horizontally and vertically across and within the organization and so it is important
for successful CSR delivery.
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HR mapping that helps to assess and manage the performance of individual Employer Perspective
employees, teams departments and other organizational units within their
organizational influence is also called competence mapping.
Competence indicates the required abilities, knowledge and skills that enable an
employee to perform his work in any organization. It is the combination of both
observable as well as measurable attributes of an employee or an organization.
HR mapping captures the different worth of individual contributors, facilitates
multiple career paths and allows flexibility in reward related decisions which
are important.
Human resource departments play a critical role in ensuring that the company
adopts CSR responsibility programmes. Furthermore, HR can manage the CSR
plan implementation and monitor its adoption proactively, while documenting
(and celebrating) its success throughout the company.
HR technology can help with a CSR programme, including reducing the

company’s carbon footprint to benefit the planet. The HR department can start
with these areas:
i) Implement and encourage green practices.
ii) Foster a culture of social responsibility.
iii) Celebrate successes.
iv) Share and communicate the value of corporate social responsibility to
employees and the community.
i) Implement and Encourage Green Practices
Implement green practices to assist in environmental waste reduction, while
promoting and encouraging stewardship growth, better corporate ethics and long-
lasting practices that promote both personal and corporate accountability.
The value inherent in embracing green aspects of corporate responsibility is clearly

understood, given the direct impact that rising energy and utility costs have on
employees’ pocketbooks. Conservation has become an accepted means of making
our planet healthier.
Reducing each employee’s carbon footprint is a great way of getting energy

conservation and recycling waste initiatives off the ground. Here are suggestions
to start:
Recycle paper, cans, and bottles in the office; recognize departmental
efforts.
Collect food, and especially donations, for victims of floods, hurricanes
and other natural disasters around the globe.
Encourage reduced energy consumption; subsidize transit passes, make it
easy for employees to carpool, encourage staggered staffing to allow after
rush hour transit.
Permit telecommuting and allow employees working remotely to the degree
possible.
Encourage shutting off lights, computers, and printers after work hours
and on weekends for further energy reductions.
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CSR Culture and Diversity Work with IT to switch to laptops over desktop computers (Laptops consume
up to 90% less power).
Increase the use of teleconferencing, rather than on-site meetings and trips.
Promote brown-bagging in the office to help employees reduce fat and
calories to live healthier lives and reduce packaging waste too.
ii) Foster a Culture of Corporate Social Responsibility
Creating a culture of change and responsibility starts with HR. Getting the younger
employees, who are already environmentally conscious and excited about fresh
Corporate Social Responsibility initiatives is a great way to begin. A committed
set of employees who infuse enthusiasm for such programmes would enable
friendly competition and recognition of programmes.
Over the past few years, major news organizations have reported on large, trusted
companies that have failed employees, shareholders and the public. These failures
created a culture of mistrust in the corporate world.
All too often, employees and employers at all levels, who competed for
advancement and recognition in harsh workplaces, were forced to accept corporate
misconduct and waste as “business as usual”.
Employer brands are being eroded and the once sacred trust that employees had
with stable pensions, defined benefits, and lifelong jobs, are being replaced
with pay for performance and adjustment to new learning goals. In this
environment, Corporate Social Responsibility can go a long way in rehabilitating
the employer brand with potential new hires and society at large. It can help
defeat the image that corporate objectives are rooted in single minded profit at
the expense of society and the environment.
Social and community connections that are encouraged by employers give

employees permission to involve their companies in meaningful ways with the
community. Employers can connect with their employees and the community
through:
Company matches for employee charitable contributions;
Community programmes and volunteer days;
Corporate sponsorship of community events; and
Encouraging employees to participate in walkathons, food banks, and so
forth.
iii) Celebrating Success
Celebrating success is important to sustain the momentum of any CSR
programme. Involving company leaders, and praising the success of these
initiatives, gives the programme real meaning.
In the rapidly expanding global workplace, the celebration of these successes

not only drives the implementation of Corporate Social Responsibility
initiatives but also allows sound corporate HR practices to enable them.
Additionally, the publicity about these successes creates a mutual understanding

of the cultures within each region that the company serves. The local population
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knows that, in addition to providing jobs, the company takes an active interest Employer Perspective
in, and participates in local issues.
iv) Community Relations

Encouraging community relations through the HR team includes implementing
reward programmes, charitable contributions and encouraging community
involvement and practices.
Examples of these programmes include sending emails and company newsletters

to staff members that highlight employees and managers involved in community
relations or creating monthly reward programmes to recognize efforts by
individuals within the company.
1.4 TRAINING AND DEVELOPMENT OF

EMPLOYEES
Training is a programme that helps employees learn specific knowledge or skills
to improve performance in their current roles. Development is more expansive
and focuses on employee growth and future performance, rather than an immediate
job role. Employees are a company’s biggest asset and investing in talent is vital
to sustainable business growth and success. Training and development can be
converted into CSR strategy so that corporates are responsible for social
development without hampering their business processes or functions and are
able to create value for their shareholders in long run.
Training and development programmes should explain the connection between

the company’s core products or services and the society at large and their value
to the local community. They must also identify ways in which employees can
get involved in appropriate CSR projects that would sustain and direct these
initiatives.
1.4.1 Creation of High-Impact Training Plan

Companies that immediately engage in employee growth and potential learning
opportunities from the moment an individual is hired will greatly impact future
employee performance and dedication. The following points cover a few effective
strategies for developing workplace talent.
1) Target soft skills

Training for soft skills is the number one priority for talent development. Driving
this is a surge of industry change, automation, and technological advancements.
The modern workplace requires adaptable, critical thinkers who can communicate
effectively.
2) Personalize employee development

Previously, training programmes approached workplace development with a ‘one
size fits all’ mentality. This technique, however, is counteractive to a growing,
diversified workplace. Employees need to be analyzed and acknowledged in
terms of their specific skills, technological fluency, and approach to learning.
When developing a programme, businesses should think of employees as
consumers.
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CSR Culture and Diversity 3) Digital learning
Ensuring employees make time for learning is the number one challenge for
talent development. Employers need to reduce any resistance to learning by
engaging talent through the existing platforms they chose to spend their time on.
Training should be delivered through multiple platforms, dynamic in its
accessibility (mobile and on-demand), personalized, and offer ongoing support.
4) Create a strategic development plan

As the skills gap continues to widen, employers need to take the initiative in
teaching and up skilling employees. The steps involved in creating a development
plan begin with establishing business goals. Employers and development
professionals should ask themselves what business factors and objectives do we
hope to impact through training? Leaders also need to decide what skills are
needed within the business, again aligning it to the overall objectives. The
development plan itself needs to incorporate various stages for effective tracking,
that analyses the before, during, and after.
The Human Resources (HR) function is the key partner in embedding Corporate
Social Responsibility (CSR) and sustainability initiatives in any organisation, as
this can be achieved only when a company educates, engages and empowers its
entire workforce. The HR function has a responsibility to be proactive in leading
the way in establishing a company-wide CSR-enabled culture.
Activity 2
Visit the CSR department of a corporate in your vicinity. Ask the employees
about the various trainings that they have undergone in the past one year.
Write down their responses.
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1.5 PERFORMANCE APPRAISAL BY EMPLOYER

A performance appraisal is a regular review of an employee’s job performance and
overall contribution to a company. It evaluates an employee’s skills so as to
place the right people in the right job.
The management evaluates and provides feedback on employee job performance

which provides a basis for improving performance, recognition, pay increases
and promotions, assigning responsibilities. It becomes the basis for promotion,
compensation, employee development, selection validation, communication and
motivation.
Employees performance appraisal aims that instead of CSR initiatives being

driven from the top, there can be a combination of top down and bottom up
approaches wherein all employees are encouraged to take the CSR commitments
70
as part of their individual responsibilities, and at the same time, the entire Employer Perspective
organization works as a unit to achieving CSR goals.
In this context, it is important for corporates to incentivize the employees to take

CSR seriously. This can take the form of mandating employees to spend time
with the wider society as part of their KRAs or Key Result Areas in the
Performance Appraisals wherein they are awarded and rewarded through the
regular appraisal process for meeting CSR commitments.
By making CSR outcomes a part of performance appraisals, these organizations

believe that the sum and substance of the total effort from the entire organization
is greater than the contributions of each employee thereby creating synergies for
the entire organization in the process.
Further, by incentivizing the employees by rewarding them for their CSR

deliverables during performance appraisals, the combination or the melding
together of ideology with practical steps ensures that an employee goes beyond
the mandate and is encouraged and motivated to do more, which again creates
value in the ultimate meaning of the word.
It is also not the case that making CSR commitments as part of performance
appraisals would be an end in itself. Instead, it is a means to an end and hence,
must be viewed in that perspective. In other words, if employees feel that spending
time in the CSR outreach programmes is something that they do reluctantly, then
the whole purpose of the process is lost. Further, if employees do this only for
meeting their performance appraisal parameters, then again, the purpose is
defeated.
There are logistical difficulties in measuring the success or otherwise of the CSR
deliverables means that such methods might sound good on paper but lack the
needed effectiveness to succeed in practice. Thus, what is needed is a mindset
change that can only happen over time. At the same time, it is our view that
making CSR commitments part of the performance appraisals is a good first step
that can lead to better outcomes.
In other words, we have to start somewhere and hence, in this respect, ensuring
that CSR and incentives for the same can go together is a sure way to making the
entire CSR outreach much more effective.
Lastly, by making the entire organization geared towards actualizing CSR

commitments, corporates can engage with the wider communities in a systemic
manner.
Check Your Progress 2
1) What is the meaning of training and development of employees?
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CSR Culture and Diversity 2) What is performance appraisal by employer?
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1.6 LET US SUM UP

In the age of globalization, corporations and business enterprises have crossed
national boundaries to become international. Business enterprises have been using
natural resources in a big way for the creation of wealth through profits and
other rewards. Business enterprises are a part and parcel of the society and as
such inevitably enter in many areas of social life. Their responsibility towards
society and environment has emerged. In the CSR context, it is well-recognized
that several projects are headed by corporate leaders, therefore, leadership
structures clearly matter for CSR – and neglecting these runs the risk of CSR
failing. HR provides the tools and framework for the executive team and CEO to
embed CSR ethics and culture in the strategic framework of the organization.
Training and development can be converted into CSR Strategy so that corporates
are responsible for social development without hampering their business processes
or functions and are able to create value for their shareholders in long run.
Employees performance appraisal aims that instead of CSR initiatives being
driven from the top, there can be a combination of top-down and bottom up
approaches wherein all employees are encouraged to take the CSR commitments
as part of their individual responsibilities, and at the same time, the entire
organization works as a unit to achieving CSR goals.
1.7 KEYWORDS
HR Mapping : HR mapping also known as competency mapping
identifies an individual’s strengths and
weaknesses. The aim is to enable the person to
better understand himself or herself and to point
out where career development efforts need to be
directed.
Corporate Social : This is a management concept where companies
Responsibility integrate social and environmental concerns in
their business operations and interactions with
their stakeholders.
Leadership : Leadership is the art of motivating a group of
people to act towards achieving a common goal.
Employee Training and : Training and development describes the formal,
Development ongoing efforts that are made within
organisations to improve the performance and
self-fulfillment of their employees through a
variety of educational methods and programmes.
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Employee Performance : This is a process often combining both written Employer Perspective
Appraisal and oral elements in which management
evaluates and provides feedback on employee job
performance, including steps to improve or
redirect activities as needed.

Batra, G.S. and Dangwal, R.C. (2002). Busines Management & Globalization.
Deep & Deep Publications, India
Christensen, L. J., Mackey, A. and Whetten, D. (2014). Taking responsibility for

corporate social responsibility: The role of leaders in creating, implementing,
sustaining, or avoiding socially responsible firm behaviors. The Academy of
management Perspectives 28(2), 164–178.
Cochran, P.L. and wood, R.A. (1984) “Corporate social responsibility and
financial performance”, Academy of Management Journal 27 (1)
De Roeck, K. and Farooq, O. (2017). Corporate social responsibility and ethical

leadership: Investigating their interactive effect on employees’ socially responsible
behaviors. Journal of Business Ethics 149 (3)
Drucker, P. (1982). The new meaning of Corporate social responsibility. California

Management Review 40 (2).
Grint, k. (2005). Leadership: Limits and possibilities (Management, Work and

Organisations). Palgrave Macmillan, p.5.
Imran, A. Kashif Ur, R., Syed Irshad, A., Jamil, Y. and Maria, Z. (2010). Corporate
Social Responsibility influences, employee commitment and organizational
performance. African Journal of Business Management, Vol. 4(12), pp. 2796-
2801.
Strand, R. (2013). CSR and leadership. In Esben Rahbek Gjerdrum Pedersen
(Ed.), Corporate Social Responsibility, pp. 39-71, London, UK-SAGE.
https://www.management-issues.com/opinion/1944/csr-an-introduction/
https://en.wikipedia.org/wiki/Corporate_social_responsibility
https://www.researchgate.net/publication/318733712_Leadership_and_
Corporate_Social_Responsibility
https://www.thebalancecareers.com/the-hr-role-in-promoting-corporate-social-
responsibility-1917743
https://www.toppr.com/guides/business-management-and-entrepreneurship/
human-resource-management/training-and-development/
https://en.wikipedia.org/wiki/Training_and_development
https://www.investopedia.com/what-is-a-performance-appraisal-4586834
https://link.springer.com/article/10.1007/s10551-018-3883-5
(https://economictimes.indiatimes.com/small-biz/hr-leadership/people/
importance-of-training-and-development-in-an-organization/articleshow/
48739569.cms?from=mdr). 73
CSR Culture and Diversity (https://www.managementstudyguide.com/csr-outcomes-as-part-of-performance-
appraisals.htm)
https://www.researchgate.net/publication/313837646_A_case_study_on_
Corporate_Social_Responsibility_in_NESTLE_TATA_ITC

ANSWERS
1) Leadership is defined as the ability to influence a group of employees’
values, beliefs, attitudes and behaviour. A leader with strong leadership
skills can easily motivate and influence the employees of the organization
and apply effective changes to the organization.
2) Key characteristics of CSR leadership are:
Systematic Understanding
Emotional Intelligence
Values Orientation
Compelling Vision
Inclusive Style
Innovative Approach
Long Term Perspective
1) Training is a program that helps employees to learn specific knowledge or
skills to improve performance in their current roles. Development is more
expansive and focuses on employee growth and future performance, rather
than an immediate job role.
2) A performance appraisal is a regular review of an employee’s job

performance and overall contribution to a company. It evaluates an
employee’s skills so as to place the right people on the right job,
achievements and growth, or lack thereof.
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UNIT 2 EMPLOYEE ENGAGEMENT
Structure
2.1 Introduction
2.2 Employee Engagement
2.3 Employer/Corporate Branding
2.4 Relationship between Employee Engagement and Employer/Corporate
Branding:
2.5 Employee Engagement, Employer Branding and CSR
2.6 Let Us Sum Up
2.7 Keywords
2.1 INTRODUCTION
One way to foster engagement in a company is through sustainability, also
called Corporate Social Responsibility (CSR). It means integrating the company’s
mission and purpose with sustainable values, and supporting environmental and
social goals in ways that connect to the company’s business. It is reinforced at
multiple levels within an organization. Employees generally perceive that an
organization which is socially engaged is one that is concerned about all people
including employees. They think that if the organisation is generally concerned
about fairness then it is more concerned about fair conditions for the employee.
So, they like to work for that particular organization.
In this unit we will discuss about the concepts of employee engagement and
corporate branding and also about the relationship between the two. After reading
this unit you will be able to:
Discuss the meaning and importance of employee engagement
Describe the strategies of corporate branding
Explain the relationship between employee engagement and employer
branding
2.2 EMPLOYEE ENGAGEMENT

In this section we will discuss about the meaning of employee engagement and
various strategies of employee engagement.
2.2.1 Meaning
Employee engagement is the extent to which employees feel passionate about
their jobs, are committed to the organization, and put discretionary effort into
their work. It is a workplace approach resulting in the right conditions for all
members of an organization to give of their best each day, committed to their
organization’s goals and values, motivated to contribute to organizational success,
with an enhanced sense of their own well-being.
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CSR Culture and Diversity According to David MacLeod: ”This is about how we create the conditions in
which employees offer more of their capability and potential”.
Employee engagement is based on trust, integrity, two-way commitment and

communication between an organization and its members. It is an approach that
increases the chances of business success, contributing to organizational and
individual performance, productivity and well-being.
It is about being included fully as a member of the team, focused on clear goals,
trusted and empowered, receiving regular and constructive feedback, supported
in developing new skills, thanked and recognized for achievement. It is about
positive attitudes and behaviours leading to improved business outcomes, in a
way that they trigger and reinforce one another.
Engaged organizations have strong and authentic values, with clear evidence of
trust and fairness based on mutual respect, where two-way promises and
commitments – between employers and employees – are understood and fulfilled.
It is about drawing on your employees’ knowledge and ideas to improve your

products and services, and be innovative about how you work. It is about drawing
out a deeper commitment from your employees so that sick absence reduces,
accident rates decline, conflicts and grievances go down, productivity increases.
It is about organization actions that are consistent with the organization’s values.
Employee engagement cannot be achieved by a mechanistic approach which

tries to extract discretionary effort by manipulating employees’ commitment and
emotions. Employees see through such attempts very quickly and can become
cynical and disillusioned.
Employee engagement is in a sense internal CSR. It is the art of having employees,

appreciating their work, and they becoming more productive and active. Vital
elements of CSR for an organization are to engage its employees and provide
them with rewarding meaningful work. Organizations with a sound track record
in social responsibility tend to produce greater pride and performance among
their employees.
Organizations need to look carefully at their own situations when deciding how
best to engage employees. Organizational context will differ as will employee
wants and needs. In the current economic climate there is a need for both
organizational engagement as well as job engagement.
We know that people are not all alike, so employee engagement requires that the
employer identifies the strengths of its employees and get the best from them.
But employee engagement is not just about the company – each person is
responsible for his/her own level of engagement.
Most companies that do it well have something in common – they understand

that it’s a driver of success and that it therefore needs to be a key business strategy,
which is everyone’s responsibility (not just HR’s or the leaders’ responsibility).
This strategy works best when it translates into behaviours and culture.
They also know that they have to look after their employees so they can look
after the customers, or as Wal-Mart’s founder Sam Walton said: “the way
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management treats associates is exactly how the associates will treat the Employee Engagement
customers”.
2.2.2 Employee Engagement Strategies

There are many good examples of companies that have achieved great results
when it comes to an engaged culture and it’s worth reflecting on what they do
and why it works. Some examples of particular interest follow.
1) Google - Transparency
Google has been very intentional about creating the culture they want. One aspect
of that culture is their focus on transparency. The idea is to break down barriers,
encourage creativity and collaboration. Employees, as a result, are feeling
empowered by that transparency. Culture comes down to behavioural habits and
Google, by creating a culture of transparency and freedom, creates habits of
creativity. Formalizing that people spend 20% of their time doing something
outside their normal work function facilitates a creative culture. Ultimately culture
is about “how things get done” and should not be left to chance. It is too powerful
a force not to take control over, and Google has done this well.
The organizations that focus on transparency engage more employees than those
who don’t. Employees want to be a part of something where there are no hidden
agendas and they are experiencing an honest perspective whether that is good
news or not. Informed employees feel valued and engagement typically follows.
2) American Express – Focus On Behaviours

In a world where results are everything and goals are often largely about what
results people achieve, regardless of how they achieved them, American Express
was different even 25 years ago. The company has for a long time had equal
weighting between the fact that people achieve their goals and how they do it. It
simply should not be possible to achieve top results, ratings, pay and potential
bonus without considering the impact of employee behaviour.
‘Behaviour’ is how we conduct ourselves, act and react, towards others. Successful
companies understand how behaviour impacts employees at an emotional level,
where much of engagement with an employer happens. They therefore value
how people do their job. The high performers in companies where engagement
is high, understand their impact and behave in a collaborative and respectful
way.
3) John Lewis - Empowering

John Lewis expresses a strong focus on people. One way of doing this is to call
their employees ‘partners’. It is not just a word, it is also the connection people
make with that word, the emotions that it awakens. By calling them partners, the
company is clearly expressing that there is a shared responsibility for the
customers and the outcomes of the company. So they focus on involving their
partners in decisions and solutions, empowering them to create the best customer
experience.
4) Hyatt – Employee Development

The hotel group’s high employee retention and long tenure speaks volumes in an
industry known for its high employee turnover. The focus on employee 77
CSR Culture and Diversity development and promoting from within plays a large part in this. Another
interesting practice, connected to development, is how they empower their
employees (whom they call associates), to listen carefully to each other and their
guests, to be able to solve problems and create new solutions, rather than following
scripts of what to do, making the guest feel special and heard.
Many organizations share this commitment to employee development and are

therefore able to trigger that inner motivation that comes from knowing that
you’re growing and developing. Besides, continuous development is crucial in
order to successfully deal with the constant change all organizations face.
5) Southwest Airlines - Purpose

This airline sees their purpose as connecting people with what’s important to
them. They don’t just see themselves as transporters of people, but as enablers
who help people get to people or places they care about. This may be seen as a
small differentiation, but it can make a big difference in how important an
employee perceives his/her job. A strong, clear purpose connects emotionally
with employees, it engages.
This purpose becomes more and more important to employees. To see that you
are doing something more profound than just selling a product or service, makes
you feel important. It’s no longer enough to “just do a job”, we’re seeing that
people want to make a difference, to contribute to something bigger than
themselves.
6) Virgin - Listening
This multi-industry organization has a habit of listening to its employees, to
show that they are valued; to listen to their opinions and take care of their ideas;
to have healthy debates; and to continuously innovate. It’s a win-win; the
organization keeps learning and employees feel important and engage with the
organization.
Listening is at the heart of engagement. Everyone wants to be seen and heard –

it’s a minimum requirement of leadership, yet often overlooked for the immense
value it can bring. We see that employees who feel listened to want to reciprocate
and do their best because they feel valued and important.
Activity 1
Read more about steps taken by different companies towards enhancing

employee engagement. Write about any one of the strategies that you found
interesting and which is not mentioned in this unit.
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78
Employee engagement is the fuel of an organization. And even if an organization Employee Engagement
is good at it, we can all get better at it – and maximize that fuel.
1) What is employee engagement?
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2) How does transparency impact employee engagement?

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2.3 EMPLOYER/CORPORATE BRANDING

2.3.1 Meaning
Employer /Corporate brand is a term that describes the company’s reputation
and popularity from a potential employer’s perspective and describes the value
the company gives to its employees.
It is the process of creating and maintaining a company’s employer brand. It is

how a company sells itself to potential candidates, the way the same company
might sell its products and how the organization attracts the best candidates.
In a modern business world of talent acquisition, employer branding is used to

introduce the company as a great place to work. It is used for communicating
with current employees as well as attracting new, generally passive, workforce.
The employer brand has a direct impact on talent acquisition. Companies with
better reputations have higher quality and more satisfied employees. Also, a
candidate’s experience is significantly improved and they tend to retain employees
longer.
2.3.2 Employer Branding Strategies

An employer branding strategy allows one to control and positively change the
dialogue surrounding one’s company, to ensure higher talent acquisition and
79
CSR Culture and Diversity retention. At its most basic, employer branding is how one market’s its company
to job seekers, and what employees say about the company as a workplace. A
good employer branding strategy can help one attract better talent, cut down on
hiring costs, and reduce employee turnover.
Some Important Steps for Creating Employer Branding Strategies:

1) Know one’s company’s unique value proposition
To create a powerful employer brand, a company should start by focusing on its
mission statement, values, vision, and culture. It could be helpful to identify
what the business needs are, and then work backwards to understand what type
of talent it needs to acquire to fulfill those objectives.
2) Conduct an employer brand audit

The Company might not be fully aware of the reputation it has among job seekers
or even its own employees. It can send out internal surveys, conduct social media
searches, etc.
3) Write an employer value proposition

Once the company has done its research and cultivated a list of values and benefits
it offers, it should create an employer value proposition. An employer value
proposition is a marketing message and a promise – so the company should not
say anything that is not true, or that its employees would not agree with. The
company might use its employer value proposition on its website,
For instance, Accenture, a global management consulting and professional

services firm, created this employer value proposition, which they’ve displayed
prominently on their careers page – “Help build the future. Be yourself, make a
difference. Work where you’re inspired to explore your passions, where your
talents are nurtured and cultivated. Innovate with leading-edge technologies on
some of the coolest projects you can imagine. And get the tools you need to keep
learning and growing so you stay continually ahead of the game while making a
difference in the world.”
4) Leverage current employees

When job seekers want to learn more about an employer’s brand, they’re going
to want to hear from and see real employees at the company. The company can
leverage one’s employees by conducting employee interviews or testimonials to
share on the website.
The company might also leverage employees by asking them to post on their
social media accounts when the company does a fun giveaway or company outing.
For instance, perhaps the company creates a ‘Women in Tech’ event and holds a
panel discussion. Afterwards, the company might simply ask its employees to
post a picture on Instagram or Facebook with a hashtag that the company has
created. This is a fun, yet powerful way for the company’s own employees to
share its culture with their own networks.
5) Cultivate a strong onboarding process

Instilling a positive company brand image starts with a good onboarding process.
It’s critical that a company gets employees engaged and excited about their roles,
and their teams, from the start. By arming its new employees with the instructions
80
and tools necessary to excel in their roles, it is ensuring a smooth transition, Employee Engagement
lower turnover rates, and more productive teams.
6) Offer learning and development opportunities

If a company allows employees to pursue learning opportunities and become
proficient in new skills, it is laying emphasis on continuous learning and
improvement. By challenging its employees, it is ensuring that they won’t get
bored in their roles – which could lead to higher retention rates and as they
develop new skills, they become more valuable employees for your company.
7) Use video, blog posts, photos, and slideshows to tell your company
story
When the company is implementing a strategy to improve the market’s perception
of its product or service, it doesn’t just communicate its message through one
channel. Instead, it provides videos, photos, slideshows, blogs, and other forms
of messaging to ensure that it is reaching the largest audience on whichever
platform they wanted its stories to be found.
8) Create a strong diversity and inclusion initiative

If the company wants to create a strong employer brand, it has to show its
commitment to building diverse teams. There are plenty of company benefits for
investing in diversity and inclusion initiatives, including more innovative ideas,
a stronger workplace culture, and better customer service attitude. However, it is
also necessary for cultivating a positive employer brand, by ensuring that the
Company’s brands reach new groups of people.
Some employer branding examples follow.
Starbucks
HubSpot
SoulCycle
Eventbrite
Jet
1) Starbucks
Starbucks does a good job of cultivating a strong community among their
employees. For instance, they refer to current employees as partners, instilling a
sense of pride in each employee. Additionally, Starbucks created Instagram and
Twitter accounts specifically for @StarbucksJobs, which they use to promote
their employer brand and interact with job seekers.
By creating social media accounts with the sole purpose of demonstrating

appreciation for current employees and evoking passion in potential candidates,
Starbucks shows its commitment to being more than just a product.
Rather than posting about their drinks, Starbucks uses its social media accounts
to share their company mission, congratulate employees on college graduation,
and share personal employee stories. The company also uses the platforms to
demonstrate its commitment to diversity and inclusion.
81
CSR Culture and Diversity 2) HubSpot
HubSpot’s culture page begins with a document called the Culture Code, which
publicly pronounces every vision and value HubSpot hopes to promote and instill
in its employees, candidates, and customers.
Moving further down the page, one will find sections discussing opportunities
for learning and development, HubSpot’s commitment to diversity and inclusion,
and interviews with real HubSpot employees. The language also consistently
focuses on the job seeker – “Here’s how we can help you grow”
The page ends with a “Day in the Life” video made by a HubSpot employee,
demonstrating HubSpot’s relentless commitment to communicating its culture
via its employees. Ultimately, the page is a powerful example for how you might
use interactive media to promote your employer brand.
3) SoulCycle
SoulCycle isn’t just transforming the boutique fitness space – it’s also aiming to
transform the traditional corporate culture, by offering benefits it feels will evoke
a sense of purpose and belongingness in each of its employees.
For instance, SoulCycle gives its employees two paid business days off per year
to volunteer at a charity of their choice, with the hope that the charity days will
help employees feel happy and more fulfilled.
Additionally, SoulCycle offers free classes (about a $ 30 per-class value) to

employees whenever it suits their schedule. This displays SoulCycle’s deeper
commitment to making fitness fun, and using exercise as an outlet to de-stress
and connect with the community.
With high ratings in each category, including four stars on work-life balance and
four stars on management, SoulCycle has undoubtedly cultivated a strong
employer brand.
4) Eventbrite
To demonstrate its commitment to recruiting high quality talent, Eventbrite created
a web page to introduce job seekers to its recruitment team. The bios are funny
and relatable, with fun facts about each recruiter.
Additionally, the Eventbrite recruitment team page states, “Interviewing shouldn’t

be nerve-wracking – it should be exciting. It should spark great conversation.
We believe in respect, transparency, and timely responses (we don’t leave anyone
in the dreaded recruiting black hole).” Their language reflects their values, likely
inspiring job seekers to apply.
5) Jet
The ecommerce site Jet created an inspirational, employee-focused video to spread
awareness for its fun, engaging, motivational workplace. The video is especially
powerful because it uses real employee interviews, giving the job seeker a sense
for Jet’s work culture and values.
Additionally, the video is empowering and pride-evoking for current employees,

who can see their company’s clear commitment to carrying out its mission
82 statement through videos of its workers.
Employee Engagement
Activity 2
Read more about the steps taken by different companies towards employer
branding. Write about any one of the strategies that you found interesting and
which is not mentioned in this unit.
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2.4 RELATIONSHIP BETWEEN EMPLOYEE

ENGAGEMENT AND EMPLOYER/
CORPORATE BRANDING
Employee engagement is the act of having employees appreciating their work,
becoming more productive and active employees. Employer branding is how a
company sells itself to potential candidates, the way that same company might
sell its products. This then leads to better employee engagement. Therefore,
employee engagement and employer branding, are not mutually exclusive ideas.
Two are closely tied to each other – one attracts people to the organization while
the other has more to do with people whom the organization has already hired.
Good employer branding attracts better candidates which in turn leads to
employees that are more apt for the company. This leads to better employee
engagement. Therefore, investment in one is a partial investment in the other.
2.5 EMPLOYEE ENGAGEMENT, EMPLOYER

BRANDING AND CSR
In the present business world of talent wars, companies are constantly trying to
attract the most talented pool of human capital and retain them. And to survive in
such competition, building one’s employer brand becomes crucial for the business.
With the rise of social media, most candidates do a lot of research on the
company’s employer brand value before joining it.
CSR helps in reinforcing the positive image of an organization. There exists a

strong connection between these two concepts of CSR and employer branding.
CSR sends out a positive message about the company and thereby increases the
employer brand value.
A comprehensive CSR policy needs engagement from employees and internal

stakeholders, rather than only the top management in order to be sustainable.
Integration of CSR into a company’s employer branding strategy is necessary to
attract talent required for the business. While developing employer branding
strategy, principles of marketing are applied to human resource activities with
regard to current and potential employees. CSR being included in the list of
employee engagement activities of various organizations is now being used as a
tool to increase the employer brand value of organizations. 83
CSR Culture and Diversity Several companies have adopted CSR activities which are helping them to
strengthen their employer brand as well. Some examples are mentioned below.
TCS
Their CSR activities include water and electricity conservation; green area
preservation and enhancement; bio-digesters of canteen waste, etc. across
locations. Apart from these initiatives, TCS also has several volunteering and
fund raising initiatives which enable their employees to reach out to society.
WIPRO
Wipro Cares is Wipro’s community initiative focused on certain key
developmental issues faced by underserved and underprivileged communities.
It was formed in the year 2003 and is committed to work with communities
proximate to Wipro’s center of operations.
Thus, in today’s competitive business world, employer branding and CSR go

hand-in-hand, and since HR has to strengthen the employer brand of a firm, the
function must be able to apply marketing principles and incorporate CSR
initiatives in the company’s strategies in such a way so as to boost the Employer
Brand.
1) What is employer or corporate branding?
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2) What is the relationship between employee engagement and employer

branding?
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2.6 LET US SUM UP

Employer branding and employee engagement go hand-in-hand. One attracts
people to the organization while the other has more to do with people whom the
organization has already hired. Good employer branding attracts better candidates
84
which in turn leads to employees that are more apt for the company. This then Employee Engagement
leads to better employee engagement. CSR helps in reinforcing the positive image
of an organisation. There exists a strong connection between these two concepts
of CSR and employer branding. CSR sends out a positive message about the
company and thereby increases the employer brand value.
2.7 KEYWORDS
Employee Engagement : Employee engagement is the extent to
which employees feel passionate about their
jobs, are committed to the organization, and put
discretionary effort into their work.
Employee Performance : A performance appraisal or employee appraisal

Appraisal is a method by which an employee’s job
performance is evaluated.
Employer Branding : Employer branding is the process of managing

and influencing the Company’s reputation as an
employer among job seekers, employees and key
stakeholders.
2.8 REFERENCES AND SELECTED READINGS

Barrow, S. and Mosley, R. (2005). The Employer Brand, Bringing the Best of
Brand Management to People at Work. John Wiley & Sons, Chichester.
Mosley, R. (2014). Employer Brand Management, Practical Lessons from the

World’s Leading Employers. Wiley.
Dicke C. (2007). Employee Engagement: I want it, what is it? White Paper,
Spring Sponsor Meeting, Center for Advanced Human Resource Studies, May
22- 23, 5-17.
Haid. H. and Sims. J. (2009). Employee Engagement: Maximizing Organizational

Performance, Leadership Insights. Right Management (A manpower Company),
1-24
Mosley, R. (2015). CEOs Need to Pay Attention to Employer Branding. Harvard

Business Review.
Konrad. A. M. (2006). Engaging Employees Through High-Involvement Work

Practices. Ivey Business Journal, March/April, 1-6.
Mirvis P.H. (2012). Employee Engagement and CSR: Transactional, Relational,

and Developmental Approaches. California Management Review 54(4):93-117
Azada, C. J., & Rochte, M. (2013). Workforce for good employee engagement
in CSR/sustainability. White Paper, 1-20..
https://www.phenompeople.com/blog/_-examples-of-awesome-employer-brands
https://beamery.com/blog/employer-branding/
https://en.wikipedia.org/wiki/Employer_branding 85
CSR Culture and Diversity https://business.linkedin.com/talent-solutions/blog/employer-brand/2018/
employer-branding
https://blog.hubspot.com/marketing/employer-branding
https://engageforsuccess.org/what-is-employee-engagement
https://blog.clearcompany.com/link-between-employer-branding-and-employee-
engagement
https://www.glassdoor.com/employers/blog/7-steps-engaging-employees-
corporate-social-responsibility/
https://www.personneltoday.com/hr/four-key-enablers-to-employee-engagement/
2.9 CHECK YOUR PROGRESS-POSSIBLE

ANSWERS
1) Employee engagement is the art of having employees, appreciating their
work, and they becoming more productive and active. It requires the
employer see his/her employees on what part they are good and get the
best from them.
2) The organisations that focus on transparency engage more employees than

those who don’t. Employees want to be a part of something where there
are no hidden agendas and they are experiencing an honest perspective
whether that is good news or not. Informed employees feel valued and
engagement typically follows.
1) Employer /corporate branding is a term referred to describe the company’s
reputation and popularity from a potential employer’s perspective and
describes the values the company gives to its employees.
2) Employee engagement and employer branding, are not mutually exclusive

ideas. Two are closely tied to each other – one attracts people to the
organization while the other has more to do with people whom the
organization has already hired. Good employer branding attracts better
candidates which in turn leads to employees that are more apt for the
company. This then leads to better employee engagement.
86
Employee Engagement
UNIT 3 ENTREPRENEURSHIP AND
WELFARE
Structure
3.1 Introduction
3.2 Entrepreneurship
3.3 Human Rights and Social Exclusion
3.4 Factors, Dimensions and Types of Exclusion
3.5 Importance of Social Inclusion
3.6 The Social Enterprise Model
3.7 Welfare and Economic Growth
3.8 Let Us Sum Up
3.9 Keywords
3.1 INTRODUCTION
Entrepreneurship means the ability to create new opportunities for income,
products, markets and other economic activities. It is in the course of a successful
entrepreneurial venture that one can provide and do a lot of welfare activities.
Entrepreneurial success leads to economic growth which in turns leads to creating
opportunities for jobs and so on. Successful entrepreneurial ventures can do a lot
towards welfare measures. The ideal situation is for entrepreneurial success and
welfare measures to go hand in hand to achieve a just society.
After studying this unit, you will be able to:
Explain entrepreneurship
Discuss human rights and social inclusion
Describe welfare and economic growth
3.2 ENTREPRENEURSHIP
The entrepreneurial function implies the discovery, assessment and exploitation
of opportunities, in other words, new products, services or production processes;
new strategies and organizational forms and new markets for products and inputs
that did not previously exist (Shane and Venkataraman, 2000). Due to the fact
that there is no market for “opportunities”, the entrepreneur must exploit them,
meaning that he or she must develop his or her capabilities to obtain resources,
as well as organize and exploit opportunities. Entrepreneurship is often discussed
under the title of the entrepreneurial factor, the entrepreneurial function,
entrepreneurial initiative, and entrepreneurial behaviour and is even referred to
as the entrepreneurial ‘spirit’. The entrepreneurial factor is understood to be a
new factor in production that is different from the classic ideas of land, labour
and capital, which must be explained via remuneration through income for the
entrepreneur along with the shortage of people with entrepreneurial capabilities.
87
CSR Culture and Diversity Its consideration as an entrepreneurial function refers to the discovery and
exploitation of opportunities or to the creation of enterprise. Entrepreneurial
behaviour is seen as behaviour that manages to combine innovation, risk-taking
and proactiveness (Miller, 1983).
3.3 HUMAN RIGHTS AND SOCIAL EXCLUSION

The classic definition of a human right is a right which is universal and held by
all persons. The concept of human rights manifests itself in the literary, artistic,
religious, legal, and political structures of all societies. Philosophers have
traditionally divided rights into two categories: positive and negative. If a citizen
has a right to freedom of speech, for example, then the state has a duty of non-
interference. This so called negative right allegedly imposes no burdensome or
costly duty upon the state. The standard view of the positive right holds that
welfare rights require extensive governmental action. “A human right by definition
is a universal moral right, something which all men, everywhere, at all times
ought to have, something of which no one may be deprived of without a grave
affront to justice, something which is owing to every human being simply because
he is human” (Cranton, 1973:36). One of the definitions cited most often is that
of Wasserstorm (1979). Any true human right, it is said, must satisfy at least four
requirements: First, it must be possessed by all human beings. Second, because
it is the same right that all human beings possess, it must be possessed equally
by all human beings. Third, because human rights are possessed by all human
beings, we can rule out as possible candidates, any of those rights which one
might have in virtue of occupying any particular status or relationship, such as
that of parent, president, or promise. Fourth, if there are any human rights, they
have the additional characteristic of being assertable, in a manner of speaking,
‘against the whole world’ (1979:50).
As one can see from the definitions, human rights are presumed to be universal
in character.
3.3.1 Genesis of Human Rights Movement in India

The rude shock received by the imposition of the national emergency in India
in1975 made the articulate and vocal sections of society sensitized to human
rights. The absence of democratic rights during those eighteen months galvanized
students, intellectuals, political activists, trade unionists, artists into action. The
educated middle class of India had thrived on an uninterrupted flow of democracy
in its national life since it gained independence in 1947. The emergency rule was
marked by detention without trial of a large number of people-students, youth,
political personalities-news censorship, trespassing without legal sanction of
private premises, tapping of telephones, interception of letters and constitutional
amendment curtailing basic rights to life and freedom in the name of national
security and violation of civil liberties. Television being monopoly of the
government was totally controlled by the ruling party. Thousands of people joined
massive rallies to protest against the anti-democratic acts of the government and
to mobilize public opinion to safeguard Indian democracy. Organizations such
as Citizens for Democracy, People’s Union for Civil Liberties (PUCL), People’s
Union for Civil Liberties and Democratic Rights (PUCLDR) and Chhatra Yuva
Sangharsh Vahini were at the forefront of human rights struggles at the national
level. Dozens of state level and city-based groups were also formed during this
88
period. For example, Committee for Protection for Democratic Rights (Mumbai), Entrepreneurship and
Welfare
Association for Protection of Democratic Rights (APDR) and Andhra Pradesh
Civil Liberties Committee (APCLC) in Hyderabad.
When the national emergency lifted in 1977, horror stories of custodial violence
and barbaric acts of torture in the police custody and prisons started pouring into
the mainstream newspapers. Bright young men and women opted for investigative
journalism as a career. Newly formed civil liberties and democratic rights groups
started bringing out their newsletters and journals in English, Hindi and several
regional languages. And organizations working against repression of the workers,
poor, peasants, dalits, women and tribal people joined ‘democratic rights
movement’. This set the tone for human rights movements in India during 1990s
that established their networks from local and regional to global level.
3.3.2 Social Exclusion: Concept and Meaning

Exclusion as a social phenomenon is expressed in different forms all over the
world. Social exclusion and discrimination are practiced on the basis of ethnicity,
gender and religion. In Indian society, mainly, the caste and patriarchal systems
are the sources of social exclusion. Social hierarchy of traditional social system
in India presents inequality between the highest and lowest castes. But in reality,
the downtrodden communities are excluded from interaction and denied access
to resources through iniquitous social arrangements.
The concept of social exclusion has been defined differently among social
scientists, both western and Indian. According to Silver (2004), social exclusion
is a multidimensional process of progressive social rupture, detaching groups
and individuals from social relations and institutions and preventing them from
full participation in the formal, normatively prescribed activities of the society
in which they live. Amartya Sen (1997) observes that social exclusion emphasizes
the role of relational feature in deprivation.
Bauvinic (2005) summarizes the meaning of social exclusion as the inability of

an individual to participate in the basic political, economic and social functioning
of society and goes on to add that it involves “the denial of equal access of
opportunities imposed by certain groups in society upon others.” On the whole,
social exclusion may be termed as a process by which, certain groups are wholly
or partly denied full participation in development activities-social, economic,
cultural and political life of societies. Thus, social exclusion refers to a process
in which individuals and entire communities of people are systematically blocked
from their rights, opportunities and resources (e.g., housing, employment,
healthcare, civic engagement, democratic participation and due process) that are
normally available to members of society and which are key to social integration.
Social exclusion is about the inability of our society to keep all groups and
individuals within reach of what we expect as a society. It is about the tendency
to push vulnerable and difficult individuals into the least popular places, furthest
away from our common aspirations.
The term social exclusion is of relatively recent origin; however, it encompasses

a wide range of social and economic aspects. Different scholars decipher this
notion in various contexts. Broadly, it indicates the relative deprivation of any
person or group of persons on various predetermined criterion. Caste based
89
CSR Culture and Diversity occupational groups in India, like that of manual scavengers, constitute one such
socially, economically, psychologically and politically marginalized sections of
the society. In India, social exclusion revolves around some sections of the
population, particularly, dalits, adivasis, women and minorities. They are the
victims of social exclusion by caste, sex, ethnicity and by religion. In the society,
they are isolated, discriminated and deprived of equal access to social and
economic opportunities. Therefore, in the Indian context, the core feature of
social exclusion is the denial of equal opportunities by certain groups of the
society which impose themselves upon others and that leads to the inability of an
individual to participate in the basic political, economic and social functioning
of society.
Amartya Sen believes that the concept of social exclusion is useful because of its
emphasis on the role of relational issues in deprivation. He then goes further,
arguing that it is important to distinguish between exclusion which is in itself a
deprivation (that is, the exclusion has constitutive relevance) and exclusion which
is not in itself negative, but which can lead to other deprivations which do not
have constitutive relevance. Sen cites landlessness and lack of access to the credit
market as examples of this latter type of exclusion, which have what he calls
‘instrumental importance’. That is, landlessness or not having access to the credit
market may not be impoverishing in themselves, but may lead to other
deprivations (such as income poverty) through causal consequences, such as the
inability to take advantage of income-generating activities that require collateral
or an initial investment and use of credit.
3.4 FACTORS, DIMENSIONS AND TYPES OF

EXCLUSION
3.4.1 Factors of Exclusion
i) Spatial Factors
Spatial inequalities include disparities between rural and urban areas, and also
between geographically advantaged and disadvantaged areas. Spatial
disadvantage may result from the remoteness of a location which makes it
physically difficult for its inhabitants to participate in broader socio-economic
processes. Or, it may operate through the segregation of urban environments and
the ‘subcultures’ of violence, criminality, drug dependence and squalor which
can often characterize urban slums and excluded neighbourhoods. In some cases,
ghettos of marginalized religious or ethnic groups can form as the direct result of
communal violence. In many countries, these disparities are increasing, partly
as a consequence of the uneven impact of trade and globalization. These disparities
are particularly worrying where they overlap with political or ethnic divisions.
The spatial dimension of exclusion cannot be entirely separated from its resource
and identity dimensions since it is usually culturally and economically
marginalized groups that inhabit physically deprived spaces. Activities of
economic and political importance are often concentrated in urban centers. These
centers also benefit from a constant inflow of new material, financial and human
resources from the peripheries. Government policies can also be biased towards
these areas. As a result of this and the constant leakage of resources to the central
regions, peripheral areas often have difficulty in self-sustaining economic
90 development.
ii) Migration Entrepreneurship and
Welfare
Migration can act both as a way of moving out of poverty, and a cause of social
exclusion. For example, foreign remittances can help receiving households to
increase their income and consumption levels, as well as their capabilities to
face socio-economic shocks. However, rural-urban migrants for example, often
do not benefit from the same political, social and economic rights as other urban
citizens. They often find themselves in insecure, low-paid jobs, or become
concentrated in vulnerable areas such as slums and deprived housing estates,
with high levels of criminality and violence.
Similar conditions can also sometimes affect foreign immigrants or refugee

groups, generating mutual mistrust and resentment. ‘Host’-immigrant tensions
can be increased by perceptions of religious, ethnic or cultural ‘otherness’ that
can sharpen social divisions and potentially contribute to conflict. (However,
findings from West Africa suggest that cultural similarities between immigrants
and host populations can actually worsen immigrant-host relations.)
Where policy directly or indirectly discriminates against migrant and immigrant

populations – through, for instance, the targeting of immigrants by law
enforcement in the first case, or the failure to provide language assistance to
foreign migrants in the second – this process may become cyclical, with structural
exclusion driving low educational attainment, low employment, vulnerability to
crime and consequent community tensions. There are thus fears that the exclusion
of migrants can pose a threat to stability.
3.4.2 Dimensions of Exclusion

Here we will discuss the various dimensions of exclusion. Exclusion can be
witnessed in political, economic, social or cultural dimensions.
Political exclusion can include the denial of citizenship rights such as

political participation and the right to organize, and also of personal security,
the rule of law, freedom of expression and equality of opportunity. Bhalla
and Lapeyre argue that political exclusion also involves the notion that the
state, which grants basic rights and civil liberties, is not a neutral agency
but a vehicle of a society’s dominant classes, and may thus discriminate
between social groups.
Economic exclusion includes lack of access to labour markets, credit and

other forms of capital assets.
Social exclusion may take the form of discrimination along a number of

dimensions including gender, ethnicity and age, which reduce the
opportunity for such groups to gain access to social services and limits
their participation in the labour market.
Cultural exclusion refers to the extent to which diverse values, norms and
ways of living are accepted and respected.
These relationships are interconnected and overlapping, and given the complexity
of influences on individuals, it is impossible to identify a single specific cause in
the context of social exclusion. People may be excluded because of deliberate
action on the part of others (e.g., discrimination by employers); as a result of
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CSR Culture and Diversity processes in society which do not involve deliberate action; or even by choice.
However, more generally, the causes of social exclusion that lead to poverty,
suffering and sometimes death, can be attributed to the operations of unequal
power relations.
3.4.3 Types of Exclusion

There are clear links between the concept of social exclusion and a rights-based
approach to development. Social exclusion analysis can help to identify which
groups are being denied access to their rights, and which actors or organizations
are blocking their access. A social exclusion analysis is useful even when rights
are not on the agenda, because it can help focus attention on those within society
who are denied access to resources, institutions or decision-making processes.
Social exclusion therefore also links to development agendas focusing on
citizenship, participation, democratization and accountability.
i) Social Exclusion: addresses the political nature of deprivation, in that it

examines the links between people’s lack of citizenship status and their
levels of poverty.
ii) Political Exclusion: political aspects of exclusion can include lack of

political rights, such as political participation and the right to organize;
alienation from or lack of confidence in political processes; and lack of
freedom of expression and equality of opportunity. Citizenship is centered
on the capability of exercising individual and collective rights, and
inequalities in this capability can generate a social hierarchy, made up of
first-class and second-class citizens. This often means that not all individuals
are equal before the law, and that they do not all have the same access to
public goods supplied by the state.
iii) Economic Exclusion: the distribution of resources and the accumulation

of wealth is an unequal process, which is based on power relations, the
capacity of various groups to lobby for their interests and influence the
government’s agenda, and the targeting of government policies. Economic
exclusion also refers to the exclusion of workers (either totally or partially)
from three basic markets: labour, credit, and insurance. Whilst this exclusion
plays an important role in the reproduction of inequality, it is also itself the
result of inequalities, in access to resources, employment, education, and
public services. Educational status and particularly illiteracy can be an
important cause of exclusion from the labour market.
Activity 1
Write about any social /political or economic exclusion that is being practiced
in your surroundings.
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Check Your Progress - 1 Entrepreneurship and
Welfare
Note: a) Use the space provided for your answers.
b) Check your answers with those provided at the end of this unit.
1) What do you understand by human rights?
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2) What are the types of exclusion? Explain any one?

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3.5 IMPORTANCE OF SOCIAL INCLUSION

Social inclusion is of utmost importance to the marginal groups because they are
discriminated in almost all walks of life. We will discuss why they need to be
included through the explanations given below:
i) Health and Education

The greater poverty of socially excluded groups often translates into poorer levels
of health and education, particularly when their poverty is combined with
remoteness and lack of infrastructure and social services.
ii) Income Inequality

Social exclusion can lead to and result from disparities in income distribution,
with the wealthiest segments of a country’s population receiving the greatest
proportion of its national income, income inequality arises from inequities in the
distribution of assets such as land, credit and education.
iii) Violence and Insecurity

When individuals or groups and particularly youth, feel excluded from power
structures, and deprived of legitimate outlets to express their grievances, they
end up feeling that only violence can provide an opportunity for them to have a
voice and to gain control over their own lives.
iv) Subjective Well–being

The psychological aspects of exclusion are also important. These include the
absence of power, voice and independence, and vulnerability to exploitation and
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CSR Culture and Diversity humiliation. When people are treated as being less because of the colour of their
skin, their sex, what they do for a living, and where they live, they can come to
internalize a sense of lack of worth that profoundly affects their sense of what
they can do and what they are due by society.
3.6 THE SOCIAL ENTERPRISE MODEL

Acting for the good of society is hardly a new phenomenon; in order to explain
social enterprise, it is useful to look at their connections to the private and public
sectors and at the different types of organizations. The social enterprise model
incorporates three closely related dimensions: the different sectors, different
organizational types and social enterprises and entrepreneurs. Between the
government sector and the private sector, the two extreme values, can be found
the non-governmental organizations (NGOs) that form the basis of the social
economy sector.
3.6.1 A Case Study of the Tata Groups

a) Self –Help Groups (SHGs)
Over 500 self-help groups are currently operating under various poverty
alleviation programs; out of which over 200 are engaged in activities of income
generation through micro enterprises. Women empowerment programmes through
Self–Help Groups have been extended to 700 villages.
b) Human Capital
Tata Motors has introduced many scholarship programmes for the higher
education of children. Through a scholarship programme Vidyadhanam, the
company supports several students. Most of these students are from marginalized
sections of the society.
c) Tata Tea
Tata Tea has been working hard since the 1980s to fulfill the needs of specially-
abled people. It has set up the Srishti Welfare Centre at Munnar, Kerala; its
various programmes provide education, training and rehabilitation of children
and young adults with special needs.
3.6.2 Shahnaz Husain: A Successful Entrepreneur

Shahnaz Husain, India’s pioneer in herbal cosmetics is credited with single
handedly placing Indian herbals on the world cosmetic map. Her success story
from a young girl from a conservative Muslim family to an international pioneer
in the field of herbals is worth sharing.
Shahnaz Husain has been bestowed many awards, titles and laurels, among them:
President of CIDESCO (it is world’s major international beauty therapy
Association)
the first Asian to enter Selfridges in London and break a forty-year-old
sales record
GQM Commitment to Quality Award
FICCI’s (Federation of Indian Chambers of Commerce and Industry)
Outstanding Women Entrepreneur
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US Magazine Success’s “World’s Greatest Women Entrepreneur” title and Entrepreneurship and
Welfare
many more
A true entrepreneur, she has a huge share of the domestic herbal market, and
sales counters in the best stores internationally, for example, the Seibu chain in
Japan, Bloomingdales in the US, Galleries Lafayette in Paris, Harrods and
Selfridges in London.
She was married at a very young age and became mother at the age of sixteen,
but she always had confidence that she was made for something more. She
didn’t choose to sit back as a housewife; the young Shahnaz started writing articles
for magazines. She used the money that she earned to fund her own education.
Staying with husband Nasir in Tehran, Shahnaz found the ideal opportunity in
the international beauty schools there. After studying cosmetic chemistry in
international beauty schools in certain centers including London, Paris and
Denmark for close to eight years, Husain hit upon the idea of exploring the 4000
year old Indian Ayurvedic system, so that she could research and develop herbal
cures and treatments.
“I had seen the debilitating effect of synthetic cosmetics abroad; there was no
doubt in my mind that the herbal system would work,” recalls Shahnaz. She
returned to India to set up her business in one room, with a borrowed investment
of Rs.35, 000 from her father. “I began with just one product – Shalife, a massage
cream. My facials were priced at Rs.100, while you get one in the market for a
trifling Rs.6,” she recollects. Despite the hefty amount, Shahnaz soon started
having more clients than she could handle. She invented a unique marketing
style of her own. Shahnaz has never advertised her products, a fact that had
Harvard in the US wanting to use her marketing system as a case study. “I would
go to a place for one day, offer free prescriptions and advice, inaugurate the
salon, and go back,” says Shahnaz and it worked. Today, The Shahnaz group of
companies has acquired a global presence, with exports to 132 countries including
those in the Middle East, South East Asia, Australia and all over Europe, 17
herbal lines, with many more in R&D. Having completed more than 30 years in
the business, Husain is busy expanding her empire by adding health resorts,
signature garments, accessory lines and more to her portfolio.
Activity 2
Write about any one socially inclusive CSR project being implemented in
your vicinity.
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3.7 WELFARE AND ECONOMIC GROWTH
Great economists like Adam Smith, John Keynes were concerned about the
“wealth of nations”. The promoter of classical economics, Adam Smith, analyst
of competition and growth, emphasized that both market and competitions play
an important role in improving the welfare of nations, by giving motivation and
economic force. Thus, the productive and innovative potential of the economy
can be fully used for achieving growth and wealth. It is obvious that the concept
of market economy arises from socio-economic legitimacy of the competition
involving everyone in the production and consumption of wealth. It raises the
question whether the distribution or the redistribution of wealth boost productivity.
Therefore, to fulfill this purpose the state must allow and promote efficient and
equitable resource distribution.
Representing the modern stage in economic science, Leon Walras (1874) has
reformed the idea that the role of each individual and the state do not oppose
each other, but complement each other, each having its scope. According to Walras
(1874), the state is responsible for ensuring the general conditions of common
existence to all citizens, and the individual must obtain through work and skills
his own welfare. Walras (1874) underlined that state should balance the rights of
the individual with the state functions. Subsequently, in the evolution of economic
thought an important role was played by John Stuart Mill, who is one of the
promoters of the social market economy. Mill (1888) was committed to reforms
and even proposed a social-liberal social policy. It shows that a propriety system
that ensures increasing material wealth at the expense of freedom is doomed
sooner or later to failure.
In the modern stage, John Keynes revolutionized the entire economic theory by
promoting an active state intervention in economy. The advocates of the welfare
state that are based on Keynesian solution, propose high public spending to finance
important public investments for economic development. Keynes’s followers
underline the importance of the salary in the distribution of goods. Securing a
job is a first step in improving living conditions. Membership in a union provides
individuals the opportunity to participate in decision-making system at the micro
level. So, employment on one hand provides the foundation for a decent standard
of living and on the other, socio-economic rights. Keynes’s followers’ point of
view is that salary is the main channel of distribution of goods in the welfare
state, and the essence of the welfare state is creating jobs to ensure a high quality
of life for all. According to the Keynesian model, the welfare state assumes that
full employment can be achieved only through stable economic growth. Economic
growth is seen as a necessity for fair distribution and for the development of
social protection. So, stimulating economic growth is the primary means of
achieving a welfare state. Only by increasing production can be achieved a balance
between supply and demand in the labour market and can ensure the financing
of a social protection system, that meets current social needs.
The European Social Model based on sustainable growth covers a wide range of
objectives, namely: resource efficiency, ensuring macroeconomic stability and
competitiveness, education and continuous training of the workforce, increasing
employment and equal opportunities. In early March 2011, The European
Commission launched the “new strategy for sustainable growth and jobs”, the
strategy ‘Europe 2020’, which replaces the Lisbon Strategy, adopted in 2000.The
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strategy ‘Europe 2020’ outlines the new vision of the EU’s development model Entrepreneurship and
Welfare
of market economy in the next decade, based on three pillars: smart growth,
which is based on the knowledge economy and innovation, sustainable growth,
which involves a competitive economy which is allocating resources efficiently,
and inclusive growth, which assumes full employment and social territorial
cohesion.
The laws of economics say social welfare should be in accordance with the
economic development level of a country. Welfare programmes that are beyond
a country’s development level are not good for economic development, as has
happened in Greece. On the other hand, if the economy develops rapidly without
corresponding improvement in people’s living standards and public welfare,
people will not feel a “sense of gain”, which in turn will have a negative impact
on economic development.
First, excessive welfare beyond a country’s development level will impede
accumulation and harm welfare programmes in the future. In economics,
production is the top priority and it decides consumption. A society has to improve
its production level if it wants to improve its consumption level. Production here
refers to extended production, because only expanding the scale will breed
competition and provide unfailing supply. The expansion of scale should be high-
quality and high-level expansion of production through innovation and
improvement of the industrial structure.
Second, welfare is not a free lunch. Welfare at any level needs economic support.
High levels of welfare in countries such as Sweden depend on high taxation and
high deficit. But the high-level welfare in Greece depends on high debt. High
welfare supported by high taxation reduces development funds for enterprises,
impeding the development of enterprises. And if enterprises lose energy, the
entire economy will suffer. High taxation also affects individuals’ desire and
capacity for consumption and thus undermines people’s enthusiasm to expand
production.
Third, excessive welfare will breed dependence and result in waste of social
resources. Although high welfare comes from individual taxpayers’ contribution,
it seems like a public welfare provided by the state. It will result in many social
problems, such as waste of social resources, voluntary unemployment and
retirement in advance. Once people get used to this kind of dependence, economic
development will be undermined.
Fourth, welfare provided by the state is a redistribution of social resources. But
such redistribution has many disadvantages. For example, it could lead to rent-
seeking and distort market signals. However, economic development will also
be undermined if the authorities fail to provide enough welfare for the people.
Note: a) Use the space provided for your answers.
b) Check your answers with those provided at the end of this unit.
1) What is social enterprise model?
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CSR Culture and Diversity 2) What is ‘Europe 2020’?
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3.8 LET US SUM UP

Human rights, social inclusion, and social welfare are very important and relevant
issues which every nation should treat with utmost importance. For overall
development of a society each section of the society should progress equally.
Mere economic growth cannot be a complete measure of development. Steps
taken towards ensuring social welfare and social inclusion strengthen the society
as a whole.
In this unit you read about the meaning of human rights, the evolution of human
rights movement in India. You have also read about social exclusion. Social
exclusion and discrimination are practiced on the basis of ethnicity, gender and
religion. You have also read about the various factors that lead to exclusion.
Political, social, economic and cultural dimensions of exclusion have also been
dealt with in this unit. The importance of inclusion has also been discussed along
with the social enterprise model. In the end, the issue of inter-relation between
welfare and economic growth has been discussed.
3.9 KEYWORDS
Entrepreneurship : The activity of setting up a business or businesses, taking
on financial risks in the hope of profit.
Human Rights : Human rights are moral principles or norms that describe
certain standards of human behaviour and are regularly
protected in municipal and international law.
Social Exclusion : Exclusion from the prevailing social system and its rights
and privileges, typically as a result of poverty or the
fact of belonging to a minority social group.
Migration : Movement of people to a new area or country in order to

find work or better living conditions.
Social Enterprise : A social enterprise or social business is defined as

a business that has specific social objectives that serve
its primary purpose. Social enterprises seek to maximize
profits while maximizing benefits to society and the
environment. Their profits are principally used to
fund social programs.
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Entrepreneurship and
3.9 BIBLIOGRAPHY AND SELECTED READINGS Welfare
Bandyopadhyay, M. (2006). Education of marginalised groups in India: From

the Perspective of Social Justice. Social Change, 36 (2): 98 – 113.
Dumitrescu, A. L. (2015). The Welfare and the economic growth: The two faces
of the same coin. Global Economic Observer3(2):116-123
Ghatak, S.K. (2011). Social Exclusion and Dalits in India-A note on violation of
Human Rights, Voice of Dalit, 4 (2), pp: 175-184
Hicks, D. A. (2002). Gender, Discrimination, and Capability: Insights from

Amartya Sen. The Journal of Religious Ethics, 30 (1): 137-154
Miller, D. (1983). The correlates of entrepreneurship in 3 types of firms.

Management Science, 29 (7): 770-791
Nageswara Rao, A. (2009). Poverty and disability in India, Social Change, 39

(1): 29 - 45
National Human Rights Commission, (2011). Annual Report. New Delhi
Power, A. (2000). Social exclusion. RSA Journal 148 (5493): 46-51
Prakash, P. (2000). Marginalisation of Tribals. Economic and Political Weekly,

35 (47): 4087-4091
Shane, S.A. and Venkataraman, S. (2000). The Promise of Entrepreneurship as a

Field Of Research. Academy of Management Review, 25 (1): 217-226
Singh, R. K. (2009). Manual Scavenging As Social Exclusion: A Case Study.

Economic And Political Weekly, 44 (26/27): 7-8.
http://dera.ioe.ac.uk/6853/1/multidimensional.pdf
http://www.gsdrc.org/go/topic-guides/social-exclusion/causes-and-forms-of-
social-exclusion-spatial-factors-and-migration
http://www.hiproweb.org/fileadmin/cdroms/Handicap_Developpement/www/
en_page61.html
http://www.gsdrc.org/go/topic-guides/social-exclusion/the-impact-of-exclusion
http://www.ncbi.nlm.nih.gov/pmc/articles/PMC2915460/
http://www.thehindu.com/opinion/lead/constitution-for-inclusive-policies/
article2494313.ece
http://www.chinadaily.com.cn/opinion/2016-01/22/content_23195110.htm
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ANSWERS
1) A human right by definition is a universal moral right, something which
all men, everywhere, at all times ought to have, something of which no
one may be deprived without a grave affront to justice, something which is
owing to every human being simply because she or he is human”.
2) The types of exclusion are:
i) economic Exclusion
ii) social Exclusion
iii) political Exclusion
Political aspects of exclusion can include the lack of political rights, such
as political participation and the right to organize; alienation from or lack
of confidence in political processes; and lack of freedom of expression
and equality of opportunity.
1) The social enterprise model incorporates three closely related dimensions:
the different sectors, different organizational types and social enterprises
and entrepreneurs. Between the government sector and the private sector
the two extreme values-can be found the non-governmental organizations
(NGOs) that form the basis of the social economy sector.
2) ‘Europe 2020’outlines the new vision of the EU’s development model of

market economy in the next decade, based on three pillars: smart growth,
which is based on the knowledge economy and innovation, sustainable
growth, which involves a competitive economy which is allocating
resources efficiently, and inclusive growth, which assumes full employment
and social territorial cohesion.
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Entrepreneurship and
UNIT 4 REHABILITATION AND Welfare
RESETTLEMENT
Structure
4.1 Introduction
4.2 The Issues of R&R
4.3 Formulation and Implementation of R&R Action Plan
4.4 Integrating R&R and CSR
4.5 Let Us Sum Up
4.6 Keywords
4.1 INTRODUCTION
Rehabilitation and resettlement (R&R) has been a burning issue in India even
before independence. But it came into the limelight with the planning of large
dams such as the one on Narmada river. It is seen as a big challenge by the
business, civil society, development professionals, affected persons and the
government for industrialization and development of the country.
The number of people displaced due to development projects are staggering.

While there is no reliable data on the number of project affected persons (PAPs),
a term used commonly in the domain of R&R, displaced or affected due to
development projects, the estimates vary widely from 50 to 100 million persons.
Further, there is no reliable data on the number of PAPs who have been resettled
or rehabilitated. This has created skepticism among planners, project proponents
and the public at large about the effectiveness of the measures taken to rehabilitate
or resettle the PAPs.
At the time of independence in 1947, the infrastructure available in India was
largely inadequate. Most of the area was quite remote with practically no social
infrastructure. India took the path to development through construction of massive
infrastructure projects like large multipurpose river valley projects, thermal power
projects, mining of minerals, construction of roads and development of industrial
hubs, etc. which required large tracts of land with consequences of involuntary
acquisition of land and involuntary displacement. Rehabilitation and resettlement
of the population so displaced was and remains an important concern.
After studying this unit you will be able to:
Explain various issues related to rehabilitation and resettlement
Describe the steps in formulation and implementation of R&R action plan
Recognize the importance of linking R&R with CSR
4.2 THE ISSUES OF R&R

The requisition of large tracts of land for various development projects involved
acquisition of forest land as well as agriculture land. The government under the
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CSR Culture and Diversity law of ‘eminent domain’ has absolute right to acquire any private land for public
purpose. It implies that what is good for larger section of society can be done at
the cost of small section of land oustees. Is this the right approach or should this
small section of land oustees be compensated, or should they also be supported
for their rehabilitation and resettlement?
Initially, most of the projects were under the government or the public sector for
which the government issued some guidelines for giving preferences in
employment and development of resettlement colonies. However, this was
sporadic and not adequate.
Development projects that displace people involuntarily generally give rise to

severe economic, social, and environmental problems: production systems are
dismantled; productive assets and income sources are lost; people are relocated
to environments where their productive skills may be less applicable and the
competition for resources greater; community structures and social networks are
weakened; kin groups are dispersed; and cultural identity, traditional authority,
and the potential for mutual help are diminished. Involuntary resettlement may
cause severe long-term hardship, impoverishment, and environmental damage
unless appropriate measures are carefully planned and carried out.
4.2.1 Issues Related to R&R

Various issues related to R&R that need to be addressed are:
1) Identification of Land to be Acquired
The acquisition of land often includes the acquisition of prime agriculture and/
or forest land. Therefore, all efforts should be made to avoid or minimize the
requirement of such land. The least that could be done is to avoid or minimize
the acquisition of homestead. Such good intention could sometimes adversely
impact the livelihood and access of the PAPs. Thus, there is a dire need to do
due-diligence while deciding the extent, boundaries and location of land to be
acquired.
The projects like mining and hydro-electric projects cannot be shifted due to
geological requirement of the project. But a little compromise on the mining
boundary or submergence level of hydro project could substantially reduce the
number of PAPs and ameliorate the suffering of the land oustees. The location
of mega projects like steel and thermal power have to be near the natural input
resources and need contiguous piece of land, albeit the boundaries can be realigned
and township could be shifted to avoid acquisition of prime agriculture and forest
land and avoid/ minimize acquisition of homestead. More flexibility is available
in the linear projects like railways and roads for changing the alignment to
minimize the hardship to land oustees.
The stakeholder engagement with the potential land loser will help in avoiding
or minimizing the acquisition of prime agriculture, forest and homestead land
and could best be carried out during project formulation, environmental and social
impact assessment and the public hearing for obtaining statutory environmental
clearance.
2) Land Records and Payment of Compensation

The land is a state subject and so is the issue of records related to land ownership.
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The land records are kept by the Patwari of the village and are rarely updated, Rehabilitation and
Resettlement
though they are supposed to be updated every 30 years, which itself is a long
period. The land owners rarely feel the need and importance of updating land
records as land remain in the family over generations and is rarely traded. It
becomes difficult to assess the real value of land as assessment is based on the
last traded value. This becomes a hurdle in deciding compensation for land and
homestead of oustees leading to legal claims that continue in the courts for
decades.
For the forest dwellers who are displaced, no land records were available making
them ineligible for compensation. The compensation that is paid to the PAPs
remains meagre in such situations and is not available to those who do not have
legal land rights.
3) Identification of Project Affected Persons

Since land records are not updated or land owners are not traceable or not residing
in the impacted area or the tribal for whom no land records are available, it
becomes a major hurdle in identifying the PAPs whose livelihood from such
land is adversely impacted.
Then there are people who do not own land and cultivate land on sharing basis.
Some work as daily wage earners for cultivation. Some have been cultivating
the revenue or forest land for generations and do not have land in their name.
These persons do not have legal identity for their source of livelihood and hence
it becomes a legal issue to identify such persons as PAPs and to prove that their
livelihood was impacted due to land acquisition.
The third category includes those, who have non land-based occupation or part
time occupation like cobbler, carpenter, ironsmith, potter etc. They do not have
legal identity to prove that their livelihoods will be impacted due to acquisition
of land.
Even for those whose legal identity is available, there are person with multiple
names having land in multiple locations resulting in multiple entries as PAPs.
There are outsiders who buy a small piece of land to claim R&R benefits and
enroll as PAPs.
There are instances where persons keep claiming about their loss of livelihood
and entitlement as PAPs for decades, making them disgruntled and dissatisfied
losing their trust in the process of land acquisition and consequent R&R.
4) Loss of Livelihoods
While the expropriation of land resulting into the loss of livelihood, which is not
merely a monetary loss, is an important issue at stake, what is equally important
is the style of earning that livelihood.
A piece of land provides the essential economic security in day to day dealing as
also for taking a loan in case of an emergency. The harvested crop is also used
for bartering to meet the other needs in an effective way. The cultivation also
provides food security, as a part of food is stored away for the need of the family.
The traditional wisdom and skills of agricultural practices are passed on through
generations for which formal education or training is not required.
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CSR Culture and Diversity People with skill and knowledge of making agricultural tools and implements
have been supporting the agricultural economy. People making household utility
items have been an integral part of rural economy. The forest based economy has
been supporting the tribal people. Tribal people develop and depend on their
own traditional skills and knowledge for harvesting the forest produce and
medicinal plants. The loss of land result in their skill and knowledge harnessed
over decades redundant in one go. The rural or the forest based economy is not
dependent on market economy where the traditional knowledge and skills are
valued and monetized to calculate the compensation for their losses.
Agriculture also provides adequate freedom of working. The work is not totally
dependent on one person but the entire family is involved. If a person is not able
to attend the agriculture work for one day, his survival is not at stake. Even other
members of a family can go and attend the work. In offseason, the person is free
to meet various social obligations, do other miscellaneous work and earn
additional income or just enjoy the life. In fact, agriculture provides employment
to each member of the family, particularly the women. Thus, the freedom of
working on one’s own terms is lost. The restoration of livelihood is, therefore,
not merely in monetary terms alone. People aspire to restoring the process of
earning that livelihood.
5) Loss of Home
The issue of resettlement into a new area creates its own complexities. There are
issues of ecological incompatibility, where the resettled area is in stark contrast
to the environment in which the PAPs were accustomed to living. Issues of
nonavailability of opportunities for traditional livelihood force them to change
to alien occupations resulting in disruption of the lifestyle of PAPs.
For tribal people, the choice of place for resettlement will obviously be in close
proximity to the forest, being familiar to such environment and dependent on
forest produce. For PAPs involved with the agriculture, the prudent choice would
be availability of agricultural options, easy access to water and pasture for animals.
Another important aspect would be familiarity of the culture, customs, traditions
and the spoken language. Resettling them in non-familiar environment will
alienate them from the host community resulting in hostility and consternation.
Entry into the labour market typically is despised by the tribals and traditional
agriculturists.
Resettling from the unplanned rural village to urban layout of the resettlement
colony in urban environment creates stress, more so with the unfamiliar
neighbourhood. The urban layout is devoid of spaces for cattle, kitchen garden,
household activities, storage of grains and cattle fodder both at individual and
community level. In many cases, the resettled population was not entitled to
legal rights over the land in the resettled area. The resettled population in the
new area faces the problem of adjustment with the host population with increasing
pressure on the already stressed frugal social infrastructure.
6) Community Facilities and Infrastructure

As most of the basic social infrastructure are not available in the remote rural
village that are proposed to be acquired, it is envisaged that basic minimum
facilities be created, that too in the resettlement colonies. These typically include
provision of primary school, primary health centre, hand pumps for water supply,
104
WBM roads in the village, community centre, area electrification, etc. The Rehabilitation and
Resettlement
villages, which are not acquired though the PAPs continue to live there or where
PAPs shift on their own, are either left out or efforts of providing facilities are
symbolic. Traditional rural infrastructure like ponds, wells, pasture land, trees,
fodder, etc., are lost in the maze of semi urban environment and not replenished.
In contrast, the industrial townships have all modern facilities including hospital,
English medium higher secondary school, piped water supply, black top/concrete
road, recreational facility, markets, etc.
These situations create disappointment among the PAPs and the host population,
who with the advent of internet and TV are exposed to the facilities available in
the cities like malls and multiplexes and aspire to have similar facilities.
Activity 1
List out various community facilities that you think should be provided while
rehabilitating a displaced population.
...........................................................................................................................
...........................................................................................................................
...........................................................................................................................
...........................................................................................................................
...........................................................................................................................
7) Lack of Stakeholder Engagement, Loss of Dignity and Ethical Values

The PAPs are often illiterate but have traditional wisdom and self-respect and
dignity. Since the PAPs do not speak corporate language, it is assumed that they
are not wise enough to take decisions about their own lives, hence the opportunity
of stakeholder engagement is denied. All decisions made by the project authorities
and the local government are imposed on PAPs assuming that it is for the good
and welfare of PAPs. This paternalistic approach results in lack of trust and
snowballing of minor issues which could otherwise be mutually resolved.
A feeling of injustice is generally embedded in the minds of PAPs due to lack of

adequate transparency and consultative mechanism during the process of
acquisition of land and they turn into persons who are ‘difficult to handle’, needing
much empathy rather than sympathy. Some outsiders often have a biased opinion,
and treat these PAPs as parasites on the project. Thus, in spite of extending
rehabilitation benefits, marginalization occurs, not just in the economic dimension
but also in social and psychological dimensions.
A strong feeling is created that local people are lethargic and inefficient as
compared to outsiders, resulting in alienation from the project, mental agony
and xenophobia. This often results into ethnic clashes. The issue is more complex
than it appears to be and creates a situation of dilemma.
This warrants a formal well-structured written down approach for engaging with
the PAPs. The engagement has to be at regular fixed intervals and records of
such meeting need to maintained and communicated to PAPs in transparent and
timely manner.
105
CSR Culture and Diversity 8) The Grievance Redressal Mechanism
While the judicial process of grievance redressal is available in a democratic
setup, not everyone has resources to avail justice from the court. PAPs have
expectation from the project authorities to address their day to day grievances.
These include issues of land acquisition, compensation, and identification of
PAPs, etc., which are technically under the purview of state government. In the
absence of genuine grievance redressal, PAPs get lost as to whom to approach.
Ultimately, PAPs lose trust in the process of land acquisition and R&R. A good,
transparent and structured grievance redressal mechanism will help PAPs to
restore trust and participate in the process of development.
1) What are the ill effects of displacement due to development projects?

.......................................................................................................................
.......................................................................................................................
.......................................................................................................................
.......................................................................................................................
.......................................................................................................................
2) What are the issues related to a grievance redressal mechanism?

.......................................................................................................................
.......................................................................................................................
.......................................................................................................................
.......................................................................................................................
.......................................................................................................................
4.3 FORMULATION AND IMPLEMENTATION OF

R&R ACTION PLAN
The preparation of R&R Plan is not an ad hoc activity but needs careful planning
by formulating a comprehensive Action Plan. The plan needs to take into account
the variables like the background and impact on the social, cultural, historical,
economic, environmental and geographical aspect on which PAPs have been
dependent. It is necessary to engage with the PAPs, project authorities and the
government before finalising the options for rehabilitation and resettlement.
Depending on the magnitude of displacement and other factors, the resettlement

plan normally contains the following structure:
1) About the project for which land is acquired
2) Objectives, goals and policies
106
3) Map demarcating project area and resettlement sites Rehabilitation and
Resettlement
4) Baseline socioeconomic survey
5) Social and environmental impact assessment
6) Legal framework
7) Valuation of and compensation for lost assets
8) Land tenure, acquisition, and transfer
9) Community participation between both PAPs and host populations
10) Plan for rehabilitation
11) Plan for resettlement
12) Plan for community development
13) Project implementation mechanism
14) Deliverables, output, outcome
15) Organizational staffing, institutional set up
16) Timeline, specific start and end dates
17) Estimated budget, financial plan
18) Monitoring and evaluation mechanism.
4.3.1 Steps in Formulation and Implementation of R&R Action

Plan
Formulation and implementation of the R&R action plan involves the following
steps:
1) Baseline socio-economic survey

The baseline socioeconomic status of PAPs is important for formulating,
implementing, monitoring and evaluation of R&R Action Plan. The objective of
the Rehabilitation and Resettlement Action Plan (RAP) is to ensure that the PAPs
improve or at least regain their previous standard of living. Therefore, it is
necessary to establish the baseline status of PAPs through a socioeconomic survey.
It not only covers the secondary data from the government agencies like census,
but also through a structured questionnaire to establish the present socio-economic
status and standard of living of each PAP.
2) Environment and Social Impact Assessment Study

The Social Impact Assessment (SIA): “Social impact assessment includes the
processes of analysing, monitoring and managing the intended and unintended
social consequences, both positive and negative, of planned interventions
(policies, programs, plans, projects) and any social change processes invoked by
those interventions. Its primary purpose is to bring about a more sustainable and
equitable biophysical and human environment.”
The purpose of the SIA is to inform decision makers and the public of the social
and economic consequences of implementing a proposed project. The SIA will
facilitate in formulation of a detailed Rehabilitation and Resettlement Action Plan
(RAP) including a community development plan.
107
CSR Culture and Diversity 3) Rehabilitation
The sustainable restoration of livelihood not only requires restoration of regular
monetary income but also extend the opportunities to PAPs to utilize their full
potential while maintaining their dignity. The biggest challenge is from the
immigrants who come looking for the opportunities with the development of the
projects. The immigrants are usually skilled, experienced, and knowledgeable
and outperform the PAPs in all spheres of life. Another challenge is adaptation
of new skills and knowledge which are in demand in neo industrial environment
and do not match with the traditional social status and life style.
Hence, restoration of livelihoods need careful planning and intense engagement

with the PAPs to make them psychologically prepared for the change. Some of
the options available are outlined below:
i) Land for Land

The ‘Land for Land’ becomes the obvious first and the best choice of
option since it assures the restoration of income in original lifestyle.
This requires an adequate facilitating mechanism even before the
compensation is paid to affected population under the Act. Often the
right type of land is not available at the right time, right location and
right price, thus rendering this option non-viable. The hostilities of the
host population also remain an issue. The average land holding of
families is about one acre which is getting smaller with time, making
the land a scarce commodity. Yet, this becomes a viable option on a
“willing buyer – willing seller” basis.
ii) Self-Employment Schemes
These are considered as the most available and viable option due to
increase in demand of goods and services with inflow of project
dependent population and evolution of semi-urban environment.
However, this becomes the least preferred option due to the uncertainties
and the risks involved. The lack of education, skills and
entrepreneurship abilities also affects the viability of this option.
Some of the common schemes include carpet weaving, masala grinding,

bamboo crafting, dairy, poultry, carpentry, goat rearing, apiculture (bee
keeping), sericulture (silkworm rearing), pisciculture (fish farming),
handicraft, etc.
While it may be seen as successful in short run due to support of project,

many factors need to be taken into consideration to ensure its
sustainability. These factors include lack of entrepreneurship, lack of
gap in demand and supply, availability of input resources, skill and
knowledge about the scheme, lack of marketing skill, issue of money
management and competition from outsiders. Other factors include
comparison with easy and comparable earnings from contractual
employment (based on minimum wages and working hours).
108
Rehabilitation and
Activity 2 Resettlement
List various self-employment schemes which you think can benefit the
displaced in earning a livelihood.
...........................................................................................................................
...........................................................................................................................
...........................................................................................................................
...........................................................................................................................
...........................................................................................................................
iii) Employment in the Project

Historically, regular employment in projects is the most preferred option,
not just due to political promises or getting benefit from the project,
but because it is least risky and more promising for ensuring sustainable
livelihoods.
In the changing social environment, a regular job in the project

instantaneously improves the social status of the person and puts him
into an elite class who has total economic as well as food security, has
access to the best educational and medical facilities, has uninterrupted
electricity, water supply and housing in a modern township.
Thus, regular employment not only addresses the restoration of previous

standard of living but provides significant improvement making this
alternative the most sought after and envied. However, with the
advancement of technology, automation and need to meet the global
standards of efficiency and manpower requirement, it becomes
increasingly difficult to provide one job per family.
iv) Small Contracts in the Projects

There are several opportunities in the project for providing the services
through small contracts on preferential or allocation basis. These include
the award of petty contracts on individual basis, award of contracts to
labour cooperative of PAPs, hiring of vehicles by the project, allotment
of shops, etc. While these are excellent opportunities, it creates total
dependency on the project which sometimes hampers the effectiveness
of the scheme.
4) Resettlement
There have been several instances in the past where the PAPs have rejected the
fully developed resettlement colonies, sometimes even with the built-up houses.
The selection of a house is one of the most important life decisions that an
individual takes and hence individuals would like to choose the best from the
available options. In contrast, the selection of location of resettlement colony
and a house within the resettlement colony is often imposed on the PAP without
consideration of any alternatives. Some of the factors that impact decision of
the PAP to select or reject the resettlement colony include:
109
CSR Culture and Diversity 1) Access to livelihood opportunities
2) Access to market
3) Access to health and education facilities
4) Availability of space in the house for storing fodder and grains and shelter
for domestic animals
5) Availability of space for expanding the house in future as the family expands
6) Availability of community land for pasture land, fodder, village pond, wells,
trees, celebrating festivals, etc.
Ideally, the best option is to superimpose the original village layout onto the new
resettlement area, identified in consultation with the PAPs. The PAPs should
also be given opportunities to settle at the place of their choice other than the
resettlement colony.
5) Community Development
The community development projects have to be planned and implemented with
a long term objective of provision for basic infrastructure and civic facilities.
This is required not only in the resettlement colonies but in the affected villages
and other neighbouring villages. The objective is that the neighbouring population
gets a share in the fruits of development due to establishment of industry in the
neighbourhood. The critical issue is about ensuring that the infrastructure created
under community development is adequately maintained and the community is
involved in identification and prioritization of the community development
projects.
The planned activities should be aligned with the national development goals
and UN sustainable development goals and should be based on scientifically
evolved development indicators and not based on the demand of influential people.
6) Stakeholder Management
The stakeholder engagement process not only enables companies to understand
the concerns of the PAPs but significantly reduces the risk by addressing the
concern in time. It also helps in checking those with vested interest to take
advantage of communication gap between the stakeholders and project officials.
A formal stakeholder engagement process includes identification of scope and
boundary of engagement and identification of individuals among the stakeholder
group who will participate in the process. It is also important that records, notes
of discussions, reports of actions taken on mutually agreed issues and details of
communication are maintained properly to reduce the risk of compliance or any
other legal risk in future. One of the examples of the stakeholder mechanism is
the formation of a Village Development Advisory Committee (VDAC) with
representatives from the affected villages, PAPs, state governments and the project
officials. NGOs and elected representatives of people could also be members of
VDAC. The VDAC could meet on a quarterly basis and share records and notes
7) Data Management and Reporting

Many of the issues erupt at a later date due to lack of maintaining records of
related data. Lack of data also creates doubt in the mind of PAPs about the veracity
of information. The data have to be complete, timely, reliable, and relevant.
Data management starts with the details of land to be acquired, valuation of land
110
and other assets, payment of compensation, list of identified PAPs and their Rehabilitation and
Resettlement
entitlements and the benefits received. It includes the details of stakeholder
engagement as well as grievance redressal.
8) Grievance Redressal
A formal three tier mechanism should be created to address all the grievances of
the PAPs from the stage of land acquisition of the project to final delivery of
rehabilitation and resettlement benefits. This mechanism can be on a fortnightly
or monthly basis. The initial grievance could be addressed through the VDAC.
In case the PAPs are not satisfied by the decision of VDAC, PAPs may raise the
issue with the second tier at the level of head of the project. The PAPs should get
another opportunity to appeal at the third level of the mechanism, either at the
regional or at the corporate level, as decided by the project.
4.4 INTEGRATING R&R AND CSR

CSR in the area covered under involuntary land acquisition is very complex as it
is intrinsically linked to the trauma of involuntary resettlement and rehabilitation,
socio-cultural turmoil and different expectation and aspirations of the PAPs. It
is necessary to understand the changing landscape of the rural environment into
semi urban industrial environment.
While R&R has to address the issues of the emotions and expectations of the
project affected persons who have certain rights, it addresses the issues more at
individual level. The CSR on the other hand addresses the issues of the basic
needs and aspirations of the persons at community level, treating both affected
and un-affected persons at par.
The industry needs to continue to invest in the community development activities

to improve the standard of living of the PAPs and the community in the
neighbourhood villages; to maintain cordial relations with the local authorities
and communities; and to minimize social risks associated with social license to
operate.
Therefore, the CSR activities need to be intrinsically linked with the community
development activities identified and planned under the RAP. As the awareness
of the community keeps evolving and population keeps increasing, the need for
CSR activities also keeps evolving. However, the industry should not lose the
guiding principle of identifying the CSR activities in the light of national and
sustainable development goals and the aspirations of the community.
1) What are the factors that influence the decision of the PAP to select or
reject the resettlement colony?
.......................................................................................................................
.......................................................................................................................
.......................................................................................................................
111
CSR Culture and Diversity 2) What is the importance of baseline socio-economic survey in formulation
of R&R Action Plan?
.......................................................................................................................
.......................................................................................................................
.......................................................................................................................
.......................................................................................................................
.......................................................................................................................
4.5 LET US SUM UP

Land acquisitions for development projects lead to displacement of people from
their locality, environment and occupational activities. Forced displacement
affects employment, income levels, productivity and overall household well-
being of the displaced. Hence it is important that steps are taken to restore the
livelihood and well-being of the persons displaced due to developmental projects.
In this unit you have read in detail about various issues related to rehabilitation
and resettlement. In order to ensure the improvement of standard of living of
project affected families after resettlement, R&R action plan should be prepared
after thorough analysis of their needs and expectation and their cultural and social
aspirations. In this unit you have also read about the various steps involved in
formulation and implementation of R&R action plan. Finally, the unit also briefly
discusses the importance of integrating CSR and R&R.
4.6 KEYWORDS
Rehabilitation and : R&R is needed when people are forced to move
Resettlement (R&R) out of their land due to reasons beyond their
control. Rehabilitation means restoration to
former state of existence and resettlement means
settling again in a new area
Project Affected : Are people who are directly affected by land

Persons (PAPs) acquisition for developmental projects through the
loss of a part or all of their land, houses, business,
crop or other types of assets
Oustee : A person who is removed from his place of

residence owing to the land being taken for
developmental project

Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation
and Resettlement (RFCTLARR) Act, 2013 (http://legislative.gov.in/sites/default/
files/A2013-30.pdf)
RFCTLARR (Amendment) Ordinance, 2014
112
(https://dolr.gov.in/sites/default/files/RFCTLARR%20Act%20% 28Amendment Rehabilitation and
Resettlement
%29%20Ordinance%2C%202014.pdf)
RFCTLARR (Amendment) Ordinance, 2015
(https://dolr.gov.in/sites/default/files/RFCTLARR%20Act%20%28
Amendment% 29%20Second%20Ordinance%2C%202015.pdf)
RFCTLARR (Amendment) Second Ordinance, 2015 (https://dolr.gov.in/sites/

default/files/RFCTLARR%20Act%20%28Amendment%29%20Second% 20O
rdinance%2C%202015.pdf)
RFCTLARR (Removal of Difficulties) Order, 2015 (https://dolr.gov.in/sites/

default/files/RFCTLARR%20%28Removal% 20of%20Difficulties%29%
20Order%2C%202015.pdf)
Compensation, Rehabilitation and Resettlement and Development Plan) Rules,

2015 (https://dolr.gov.in/sites/default/files/167169_0.pdf)
The Land Acquisition Act, 1894 (https://dolr.gov.in/sites/default/files/THE%20

LAND%20ACQUISITION%20ACT.pdf)
World bank guidelines on involuntary resettlement (http://documents1.

worldbank.org/curated/en/206671468782373680/pdf/301180v110 PAPE
1ettlement0sourcebook.pdf)
IFC guidelines on involuntary resettlement (https://www.ifc.org/wps/wcm/

connect/61320ff7-0e9a-4908-bef5-5c9671c8ddfd/GN5_English_2012.pdf?
MOD=AJPERES&CVID=mRQjWGZ)

ANSWERS
1) Development projects that displace people involuntarily generally give rise
to severe economic, social, and environmental problems: production
systems are dismantled; productive assets and income sources are lost;
people are relocated to environments where their productive skills may be
less applicable and the competition for resources greater; community
structures and social networks are weakened; kin groups are dispersed;
and cultural identity, traditional authority, and the potential for mutual help
are diminished.
2) While the judicial process of grievance redressal is available in a democratic

setup, not everyone has resources to avail justice from the court. PAPs
have expectation from the project authorities to address their day to day
grievances. These include issues of land acquisition, compensation, and
identification of PAPs, etc., which are technically under the purview of
state government. In the absence of genuine grievance redressal, PAPs get
lost as to whom to approach. Ultimately, PAPs lose trust in the process of
land acquisition and R&R.
113
CSR Culture and Diversity Check Your Progress - 2
1) Some of the factors that impact decision of the PAP to select or reject the
resettlement colony include:
1) Access to livelihood opportunities
2) Access to market
3) Access to health and education facilities
4) Availability of space in the house for storing fodder and grains and
shelter for domestic animals
5) Availability of space for expanding the house in future as the family
expands
6) Availability of community land for pasture land, fodder, village pond,
wells, trees, celebrating festivals, etc.
2) The baseline socio economic status of PAPs is important for formulating,
implementing, monitoring and evaluation of R&R Action Plan. The
objective of the Rehabilitation and Resettlement Action Plan (RAP)is to
ensure that the PAPs improve or at least regain their previous standard of
living. Therefore, it is necessary to establish the base line status of PAPs
through a socio-economic survey.
114
MEDS-052
CSR PROCESS
Block
3
STAKEHOLDERS’ ENGAGEMENT
UNIT 1
Stakeholders
UNIT 2
NGOs and Cooperatives
UNIT 3
CSR and Government Programmes
UNIT 4
Corporate Foundations
UNIT 5
Local Bodies
Stakeholders’ Engagement
BLOCK 3 STAKEHOLDERS’ ENGAGEMENT
Block 3 Stakeholders’ Engagement consists of five units.
Unit 1: Stakeholders discusses the concept, definition and types of stakeholders,

methods to identify stakeholders, stakeholder mapping and prioritization of
stakeholders. It also discusses stakeholder engagement and its benefits.
Unit 2: NGOs and Cooperatives discusses about NGOs and Cooperatives and
their role in corporate social responsibility. It also talks about how a company
can identify the right kind of NGOs for CSR intervention.
Unit 3: CSR and Government Programmes discusses the role of government

in supporting CSR and good practices to foster CSR. It also discusses the role of
public private partnerships in CSR.
Unit 4: Corporate Foundations discusses the role of corporate foundations in

corporate philanthropy. It also talks about the various types of Non-profit
Organizations i.e. Trusts, Societies and Section 8 Companies. It discusses about
the role of these organizations in CSR.
Unit 5: Local Bodies discusses about the role and functions of urban and rural
local bodies. It also discusses the implementation of CSR by both urban and
rural local bodies. Finally, it talks about the various challenges faced in CSR
implementation.
116
Stakeholders
UNIT 1 STAKEHOLDERS
Structure
1.1 Introduction
1.2 Social Responsibility of Business
1.3 Stakeholders: Concept, Definition and Types
1.4 Methods to Identify the Stakeholders
1.5 Stakeholders Mapping
1.6 Prioritization of Stakeholders and Stakeholders’ Engagement
1.7 Let Us Sum Up
1.8 Keywords
1.1 INTRODUCTION
Every business operates within a society. It uses the resources of the society and
is dependent upon the society for its smooth functioning. This creates an obligation
on the part of business organization to fulfill their needs, to make extra-ordinary
efforts for societal benefits, to help the society in the critical times etc. Therefore,
all the activities of the business organization should be directed towards protecting
the interest of the society and serving the society for betterment. Stakeholders
are hence important for any business as they support the business from the
perspective of someone who has a stake or has something to gain or lose. When
at its best, the relationship between the business and the stakeholders would be
healthy and promote mutual benefit. While at its worst, it may be one of constant
disputes due to conflicting interests and can make decision making very stressful
and slow for the business organizations. Successful relationships with the
stakeholders is essential for the success of any business. Hence, it is essential to
know about stakeholders while dealing with CSR projects and activities of the
companies.
Define stakeholders and identify the types of stakeholders
Discuss methods to identify the stakeholders
Determine which stakeholders are most useful to engage with using
stakeholder mapping
Classify stakeholders on the basis of their attributes
1.2 SOCIAL RESPONSIBILITY OF BUSINESS

Social responsibility is the deliberate effort of the business corporations to satisfy
the expectations of various interest groups. Social responsibility is the company’s
mission to be responsive to social needs by allocating a part of its resources for
achieving social goals and tackling social problems.
117
Stakeholders’ Engagement For example, Tata Motors is committed to sustainable development, where
business goes hand in hand with societal well-being and environmental
consciousness. Their CSR programs are:
a) Aarogya-Health: Focuses on maternal and child health by adopting a
holistic approach and striking a balance between preventive healthcare and
curative healthcare interventions.
b) Vidyadhanam-Education: Encourage and support the students to
participate in co-curricular activities ensures their holistic growth, i.e.
academic, physical and social development.
c) Kaushalya-Employability or Skilling: Aims to build the capacity of
unemployed youth by providing vocational training in automotive and other
industrial trades.
d) Vasundhara-Environment: Strives to contribute to enhanced
environmental sustainability by proactively facilitating the protection,
conservation, judicious use and augmentation of natural resources.
e) Amrutdhara-Drinking water: This programme not only addresses the
concerns relating to safe drinking water, but also helps in improving health,
fostering gender equality and promoting social equality.
f) Aadhaar-Community Development: Aimed at serving the socio-
economically backward and disadvantaged Scheduled Caste (SC) &
Schedule Tribe (ST) communities.
g) Seva-Voulnteering: Aimed at providing employees and their families with
varied opportunities to meaningfully volunteer their time for social causes.
Various parties towards which business organizations are socially responsible
include:
1) Employees/workers: This is the human element of the business
organization, people who convert all the plans and strategies into actions.
The organization has a responsibility towards them to provide safety,
security, health concern, parity, justice and equality at the workplace.
2) Shareholders or Investors: are the individuals/groups/organizations that

have good faith in the organization’s growth and profitability. They expect
that it will multiply their money within stipulated time. The concept of
‘Shubh Labh’ (auspicious gains) applies for its shareholders, i.e., to disburse
right profit and share.
3) Consumers: These are all those who purchase the organization’s output
(goods or services) for their personal use or to further business purposes.
The organization should provide the right product at the right price in the
right quality and the right quantity with the right information at the right
place to have the customers’ trust.
4) Suppliers and Vendors: These are the individuals or organizations who

supply raw materials, machineries, equipment and tools for business
processes. The organization should provide them timely payment, continuity,
loyalty, trust for maintaining quality standards.
5) Competitors: All those business organizations dealing with the same kind
118 of products and services come into the category of competitors. The
organization should promote healthy competition in the industry for business Stakeholders
growth in the right way.
6) Government: The government of any country or of any political subdivision
of any country, any other person or organization authorized by law to perform
any executive, legislative, judicial, regulatory administrative functions of
such government. The organization should help and support various schemes
of Central and State Government.
7) Environment: With this perspective, the organization should have good
concern for green and clean environment. All the business practices and
activities should be planned and performed with eco-friendly approaches.
8) Local community: It consists of business operators, public agency staff
and residents, and their interactions that can include the sharing of resources,
information and assistance. The organization should think about the physical,
intellectual and societal development of the local community.
9) Society: A group of people of a country or area sharing values, customs
and laws. The organization should maintain social values, norms, and
textures of the society.
10) Nation: The organization should provide economic contribution and make
developmental efforts for country’s prosperity.
Figure 1 shows the various claimants for social responsibility of any business.
There are many situations where social responsibility of business becomes
necessary like to create good corporate image, social commitment, because of
legal provision, etc. But the next question arises, why should any business come
forward and be responsible towards the stakeholders.
Employees /
Workers
Shareholders
Nation
/Investors
Society Consumers
Social Responsibility
of Business Towards
Local Suppliers &

Community Vendors
Environment Competitors
Government
Figure 1: Claimants of Social Responsibility of Business

(Inspired by: Business Environment: Francis Cherunilam) 119
1.3 STAKEHOLDERS: CONCEPT, DEFINITION
AND TYPES
Corporate Social Responsibility (CSR) is a duty of every corporate body to
protect the interest of the society at large. Even though the main motive of business
is to earn profit, corporates should take initiative for welfare of the society and
should perform its activities within the framework of environmental norms.
According to Calderon (2011) there are copious definitions of CSR both from
the academia and the professional field, but a generally accepted one originated
by the European Commission defines CSR as “a concept whereby companies
integrate social and environmental concerns in their business operations and in
their interaction with their stakeholders on a voluntary basis. Being socially
responsible means not only fulfilling legal expectations, but also going beyond
compliance”.
A ‘stake’3 is an interest in or a share in an undertaking (Bucholtz and Carroll,

2011). A stake can simply mean having an interest in a decision, for example:
“how will the road bypass affect me?” On the other hand it could be a legal
claim. For example, a shareholder has a stake through their part or full ownership
of a business.
Bucholtz and Carroll (2011) explain that between these two extremes a stake can
also be a ‘right’. A right can be a moral right, for example, an ethical principle or
a feeling about fairness in a particular situation – “a right under law for employees
to be treated equally regardless of gender, religion, etc.”
Figure 2: Types of Stake
(Source: What is a Stake? Meaning of Stake https://www.stakeholdermap.com/what-is-a-

stake.html)
Stakeholder is a person, group or organization that has interest or concern in an

organization. Stakeholders can affect or be affected by the organization’s actions,
objectives and policies. Some examples of key stakeholders are creditors,
directors, employees, government (and its agencies), owners (shareholders),
120 suppliers, unions, and the community from which the business draws its resources.
Not all stakeholders are equal. A company’s customers are entitled to fair trading Stakeholders
practices but they are not entitled to the same consideration as the company’s
employees.
The Stakeholder Theory (Freeman, 1984) clearly underlines the fact that investing
a firm’s time and resources to redress issues and concerns of stakeholders is a
justifiable managerial activity. This perhaps forms the very basis of the concept
of corporate social responsibility (CSR).
1.3.1 The Concept of a Stakeholder 4

This can often be misunderstood. When talking about stakeholders, it is important
to realize that:
Stakeholders are not only local people. They include governments and
their agencies, as well as people, organizations, institutions and markets,
which are not necessarily located close to the organization that is being
managed.
Stakeholders are not only organizations and formal groups. They include
individuals, communities and informal networks. Facilitators of planning
and management processes must be prepared to recognize and involve the
sectors of society that are not formally represented and organized.
Stakeholders are not only the customers of an organization. They include

people and institutions that impact not just directly but also indirectly on
the organization even without using its products.
Stakeholders change over time. New stakeholders can enter in a business

organization system, while others may lose their role or interest. For
example, changes in the local economy, society, organization system, and
in the status of products, will inevitably provoke changes in the ways people
use, and relate to an organization. Stakeholder identification is therefore an
ongoing process, and it is one that must incorporate a historical dimension.
1.3.2 Defining Stakeholders 5

The word ‘stakeholder’ has assumed a prominent place in public and non-profit
management theory and practice in the last 20 years, and especially in the last
decade. The term refers to persons, groups or organizations that must somehow
be taken into account by leaders, managers and front-line staff.
R. Edward Freeman, in the classic text Strategic Management: A Stakeholder

Approach (1984), defined a stakeholder as ‘any group or individual who can
affect or is affected by the achievement of the organization’s objectives’. Typical
definitions of stakeholder from the public and non-profit sector literatures include
the following variants:
‘All parties who will be affected by or will affect [the organization’s] strategy’
(Nutt and Backoff, 1992).
‘Any person, group or organization that can place a claim on the organization’s
attention, resources, or output, or is affected by that output’ (Bryson, 1995).
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Stakeholders’ Engagement ‘People or small groups with the power to respond to, negotiate with, and change
the strategic future of the organization’ (Eden and Ackermann, 1998).
‘Those individuals or groups who depend on the organization to fulfill their own
goals and on whom, in turn, the organization depends’ (Oohnson and Scholes,
2002).
‘The individuals and constituencies that contribute, either voluntarily or

involuntarily, to its wealth-creating capacity and activities, and are therefore its
potential beneficiaries and/or risk bearers’ (Post, et al., 2002).
According to the Project Management Institute (PMI), the term stakeholder refers
to, ‘an individual, group, or organization, who may affect, be affected by, or
perceive itself to be affected by a decision, activity, or outcome of a project’
(Project Management Institute, 2013).
1.3.3 Types of Stakeholders 6

Freeman (1984 cited by Miragaia et al., 2014) lists employees, customers,
suppliers, shareholders, banks, environmentalists and the government as
stakeholders – sourcing from the aforementioned definition by Freeman and Reed
(1983) that considers the groups that are able to harm or help the organization as
stakeholders. Post et al. (2002) consider stakeholders similarly, as seen in
Figure 3.
Political
Groups Owners /
Government Shareholders
Financial
Suppliers
Community
Activist
Competitors Firm
Groups
Trade
Associations Customers
Employees Managers
Unions
Figure 3: Stakeholders of a Large Organization
(Source: Adapted from R.E. Freeman 1984, Strategic Management: A Stakeholder Approach)
122
Arising from the existence of very many different stakeholder groups, it can be Stakeholders
useful to classify them to subgroups along following attributes. The classification
can help to determine roughly their importance or needs:
Primary stakeholders have a vested interest in how the organization

performs and the actions it engages in to conduct business. Examples of
these types of stakeholders are customers, employees, suppliers, board of
directors, owners, and shareholders. Primary stakeholders benefit from a
well run company but are also harmed by the organization’s mishaps.
Primary stakeholders directly affect the success and failure of the company.
Secondary stakeholders can influence, both positively and negatively, the

actions of the organization. They indirectly affect the organization by taking
actions to make it difficult for the organization to succeed or by supporting
the organization’s efforts. Examples of secondary stakeholders are
government agencies, regulation agencies, trade unions, labor unions,
political groups, social groups, and the media.
Internal stake holders are those who operate entirely within the boundaries
of the organization. External stakeholders are those who provide inputs
to the organization (equipment, material suppliers), those who compete with
the organization (for customers, resources) and those who have some other
interest in the organization’s function (government, media, etc.) (Mayers,
2005; Carlon and Downs, 2014)
Active and passive stakeholders. Mahoney (1994) identifies active

stakeholders as those who seek to participate in the organization’s activities
and they may or may not be a part of the organization’s formal structure,
e.g., management and employees. They are considered active stakeholders
as well as can be regulators or environmental pressure groups. Passive
stakeholders are those who do not normally seek to participate in an
organization’s policy making, but it need to be emphasized that even though
they should not be considered less interested or less powerful. Passive
stakeholders will normally include most shareholders, government or local
communities.
1.4 METHODS TO IDENTIFY THE

STAKEHOLDERS
Methods to Identify the Stakeholders7,8
There are a number of ways to identify stakeholders. Often, the use of more than
one method will yield the best results.
a) Social Data Collection: One of the first and least prominent ways to gain
insights about stakeholders of local community is to look at background
demographic information about local economic and industrial trends and
insights from local media sources. This contains a data sheet for gathering
information about a community and considering the potential benefits and
impacts of a business organization/project.
These demographic data can often be found online at the community, region,
state, and/or federal or national level. The Census Bureau of India has a
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Stakeholders’ Engagement website that provides a link to the various statistical agencies. The Social
Data worksheets in the toolkit given in the link provided in the website
help the user to organize this information for potential local benefits or
concerns that can be accessed through more in-depth outreach to the
community.
Various forms of social media (e.g., Twitter, Facebook, blogs, WhatsApp)

are increasingly relied on to share information and reactions to events. Some
of these can be searched for links or information about a community being
considered for a business organization location and can provide helpful
background information about public concerns and views.
b) Baseline Survey: Business or project operators may want to consider

conducting a baseline survey to assess knowledge, opinions and attitudes
regarding the issues of climate change, other energy technologies and factors
in the local community.
The toolkit contains a series of questions (Who, What, Why, When, and
How) to help the business operator to start with the desired information,
how it might be used, and the various methods for obtaining it. The toolkit
also contains a sample survey. If the result of the sample survey is found
appropriate, then this can be targeted towards a relatively large number of
people. Typically, there are a number of survey options that may include
online surveys, polling at locations with crowds (such as shopping malls),
phone surveys, and written surveys.
The results of such a survey could further help in stakeholder identification.

Results could also be used in the other steps of stakeholder mapping and
assessing organization’s communication strategies with their stakeholders.
c) Brainstorm: Essentially, brainstorming is an exercise in which individuals

or small groups of people are asked to develop ideas in response to a specific
question or topic. In this case, the question is some formulation of ‘who are
the organization’s stakeholders’? Participants are asked to name stakeholder
segments, groups, and/or individuals that they think will be a stakeholder
for the project. There are a number of ways to stimulate creative thinking
from participants:
Secure the participation of a relatively diverse group of participants to
avoid “group think”
Have prompts or tools in hand to be used if needed
Keep the tone of the session upbeat and encouraging
Record all ideas in a visible place to help stimulate add-on thinking
Table 1: Stakeholder Identification Tools and Techniques
Tools / Techniques Key Questions or Insights
Social Data Collection Who lives in the community?

What are the economic, education, and
employment trends?
What does local news coverage indicate
124
Stakeholders
about views on climate change, energy
policy, subsurface activity, environmental
concerns, etc.,?
Baseline Survey What are knowledge of and attitudes

toward science and energy issues?
What are knowledge of and attitudes
toward climate change and CCS?
What is the level of trust in government
and host company(ies)?
Brainstorming Who are the project’s stakeholders?

What is known about their perceptions
and concerns?
Interviews & Focus Groups Who are the project stakeholders?

What is their contact information?
d) Interviews & Focus Groups: These data collection methods for

stakeholders involve inviting stakeholders to express their opinion on the
objective. The number of people in a focus-group typically varies from 4 to
12 participants.
The key to holding a successful focus group session is to ensure no

participant dictates the discussion. Therefore, careful moderation is critical
to the success of a focus group. Another critical success factor is that the
discussions should not be based on preconceived notions. Rather, they should
be used to understand them better. Participants should not only concur or
disagree, but rather build on the opinion expressed. Through focus groups,
a large amount of data can be collected. The key is to ensure that participants
are carefully selected.
Activity 1
Visit a CSR project being implemented in the city of your residence. List out
the identified stakeholders of the project.
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Stakeholders’ Engagement Check Your Progress-1
1) Name the various claimants for social responsibility of any business.
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2) Who is a stakeholder? Name the methods to identify stakeholders.

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1.5 STAKEHOLDERS MAPPING

Mapping is an important step to understanding who the key stakeholders are,
where they come from, and what they are looking for in the business. Stakeholder
mapping is a collaborative process of research, debate, and discussion that draws
from multiple perspectives to determine a key list of stakeholders across the
entire stakeholder spectrum. The process of stakeholder mapping is as important
as the result, and the quality of the process depends heavily on the knowledge
about the organization’s stakeholders.
Mapping stakeholders is a visual exercise and analysis tool that an organization

can use to further determine which stakeholders are most useful to engage with.
Mapping allows us to see where stakeholders stand when evaluated by the same
key criteria and compared to each other.9The aim of this step is to differentiate
identified stakeholders groups according to certain attributes.
This method is described in detail by Eden and Ackermann (1998, pp. 121–125,
344–346). It is based on two attributes: power and interest that are thought of as
range (from low to high) and helps to identify which stakeholders are the most
powerful and which has the biggest interest in a company (Bryson, 2004).
Power versus Interest Grid10

The power/interest grid is a two-dimensional matrix that classifies stakeholders
into four groups according to the power they hold and to the degree to which
they are likely to show interest (which their positions impose on them):
126
High power and high interest stakeholders: These stakeholders are Stakeholders
required to be kept informed. These should be closely involved in all business
decisions. (Key Players)
High power and low interest stakeholders: These are the stakeholders
who need to be kept satisfied to gain their support during business/project.
The managers should inform them wherever necessary so as to maintain
their interest in the business. These stakeholders are able to reach to more
powerful groups such as the organization’s owners or even the media.
(Latents)
Figure: 4 Power versus Interest Grid
(Source: https://citoolkit.com/articles/stakeholder-analysis/)
Low power and high interest stakeholders: These stakeholders are highly
interested in the business results; however, they have little power as
individuals to influence any business decision. There should be regular
communication with them so that they are kept as informed as is necessary.
Examples of these stakeholders are the staff who will apply the improved
processes. (Defenders)
Low power and low interest stakeholders: These stakeholders do not have
a great deal of influence, nor they have any interest in the proposed action.
The results are likely to have little impact on them; therefore, they don’t
require a great deal of consideration. However, there should be an occasional
communication with them so that they are kept informed about important
issues and changes. (Marginals)
127
Stakeholders’ Engagement Figure 5: Extended version of Power-Interest Grid
Power/Influence
(Source:https://www2.mmu.ac.uk/media/mmuacuk/content/documents/bit/Stakeholder-
analysis-toolkit-v3.pdf)
Stakeholders often move around the grid. Some Stakeholders will become more
interested as the implementation progresses and they begin to see that the changes
will affect them. Others may become more powerful through internal promotion
or transfer. Hence, the analysis needs to be carried out regularly throughout the
project.
1.6 PRIORITIZATION OF STAKEHOLDERS AND

STAKEHOLDERS’ ENGAGEMENT
1.6.1 Prioritization of Stakeholders11
It is very difficult for the organization to balance the interest of all the stakeholders
as well as meet the business objectives. The former task involves financial
resources which may impact the financial performance of the company. Therefore,
it becomes very important to prioritize the stakeholders in accordance with their
expectations and relevance to the organization.
A number of studies have been made in the past which gives insights about
determining the significance of relevant stakeholders.
Savage (1991) discussed about categorizing the stakeholders on the basis of their
potential of being cooperative or imposing the threat with the organization. This
is more practical approach which distinguishes the supportive stakeholders from
the opponent ones. The organization should give more attention to the supporters.
This method is questionable and requires more clarity in thought.
Polonsky (1996) recommended that the organization must consider that the
stakeholders can influence the third parties or other stakeholders to take action.
This explains that even stakeholders who do not have direct impact on a company
can also be tactically important because of their influential abilities to other
stakeholders.
128
Freudenberg (1999) arranged stakeholders in line with the attributes of knowledge, Stakeholders
power and preferences. These three criteria are interrelated as one who has
knowledge is expected to have power. Furthermore, Frooman (1999) developed
a resource dependency theory that discussed an organization’s dependency on
stakeholders, and vice versa. This means stakeholders have direct or indirect
influence on organization for human, financial, and informational resources.
Afterwards Johnson and Scholes (2002) studied stakeholder’s interest in
influencing business operations and their ability to enforce their preferences.
Therefore, stakeholder’s prioritization should be practical and cost-efficient so

as to be applicable in the corporate world. This requires discussing Mitchell,
Agle, Wood’s (1997) theory based on power, legitimacy and urgency.
Mitchell, Agle, Wood’s (1997) Theory:

The stakeholder attributes can be defined on the basis of the following attributes:
Power, Legitimacy and Urgency 12
Power
Power can be defined as “the stakeholder’s capacity to influence the organization”
(Miragaia et al., 2014). As per Krüger (1974) and Weber/Winckelmann (2009), a
stakeholder who is able to impose its own preferences against the company’s
will can be referred to as powerful.
Etzioni (1964, cited by Mitchell et al., 1997) suggests more precise classification
of power, based on the type of resources used to exercise power. It is coercive
power, based on the physical resources of force, violence, or restraint; then
utilitarian power, based on material or financial resources; and normative power,
based on symbolic resources. A party has a power to the extent of how it gains
access to coercive, utilitarian or normative means of power.
Legitimacy
Legitimacy is a desirable social good and it may be negotiated differently at
various levels of social organization. Suchman (1995) defines Legitimacy as
behavioral patterns which are considered appropriate or preferable within social
systems.
Urgency
Adding the attribute of urgency helps to move the model from static to dynamic.
Urgency can exist only when two conditions are met:
When a relationship is of a time-sensitive nature, or
When that relationship is important or critical to the stakeholder.
Therefore, urgency is based on the two attributes: time sensitivity and criticality
and can be defined as the degree to which stakeholder claims call for immediate
attention.
On the basis of these attributes, stakeholders can be differentiated in eight

categories, exhibited in figure 6. Mainly, there are three types of stakeholders:
1) latent, which possess only one of the attributes and therefore are considered
as low salience classes;
129
Stakeholders’ Engagement 2) expectant, which possess two attributes and are called moderately salient
stakeholders, and
3) definitive, which possess all the three attributes and which are considered
as highly salient stakeholders.
Figure 6: Stakeholder Typology

(Source: https://i2s.anu.edu.au/resources/stakeholder-analysis-power-legitimacy-urgency)
Classification of Stakeholders on the Basis of the Attributes Present

i) Dormant stakeholders
These are latent stakeholders, who possess only the attribute of power. They
can impose their will on the company, but as they do not have any other
attribute, their power remains unused.
ii) Discretionary stakeholders

Latent stakeholders possess the only attribute of legitimacy. This group is
particularly interesting for corporate social responsibility questions. There
is absolutely no pressure on managers to engage in an active relationship
with such stakeholders.
iii) Demanding stakeholders

This category includes latent stakeholders who have the only attribute of
urgency, which is the reason why they are called demanding. They are usually
very passionate in acquiring management attention, but without power or
legitimacy usually they are not paid any attention.
iv) Dominant stakeholders

They belong to expectant stakeholder, because they possess two of the
attributes. Being both powerful and legitimate, their influence in the firm is
assured. They expect and receive much of managers’ attention.
130
v) Dependent stakeholders Stakeholders
This group of expectant stakeholders lack power, they have urgent, legitimate
claims, which they are having hard time to reach, and therefore they are
called dependent. They sometimes seek help through advocacy or
guardianship of other stakeholders.
vi) Dangerous stakeholders

They are expectant stakeholders possessing urgency and power. These
stakeholders are often coercive or even violent. They sometimes express
themselves through strikes, employee sabotage, etc.
vii) Definitive stakeholders

This group possesses all three attributes and has the highest salience of
them all. They are perceived by managers to be present. The most common
occurrence is the move of stakeholders from dominant group to definitive
(by obtaining the attribute of urgency).
Activity 2
On the basis of the above classification of stakeholders, classify the stakeholders

identified in ‘Activity 1’ by comparing their attributes to that of above
classification.
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1.6.2 Stakeholders’ Engagement13

Stakeholder engagement refers to the process by which a company communicates
or interacts with its stakeholders in order to achieve a desired outcome and enhance
accountability. Companies have, to varying degrees, always engaged with
stakeholders in one way or another. Historically, engagement tended to be more
reactive or focused on risk mitigation.
As the corporate social responsibility movement has grown, companies have
become proactive under the assumption that stakeholder engagement can enhance
the sustainability and profitability of the organization.
Benefits of engaging with stakeholders include:
Building Trust: Sincere efforts at engagement can improve relations between
a company and its stakeholders. This can diffuse existing tensions and make
it easier to solve potential problems down the road.
Risk Management: Working with stakeholders can lead to a more stable
operating environment and reveal critical information that is important for
company decision-making.
131
Stakeholders’ Engagement Brand Enhancement: By engaging with stakeholders a company can improve
its visibility and reputation. Customers, investors, and other economic
stakeholders may also view this engagement as a differentiating factor in
the market.
Improved Productivity: Better internal engagement can identify areas in

which the company can become more efficient. Additionally, employees
that have a greater voice in the workplace tend to have higher morale.
Strategic Opportunities: Engaging with stakeholders can help a company

to identify new business opportunities and market segments.
Partnerships: By collaborating with stakeholders, companies can pool

resources to achieve a common goal.
Increased Investment: Greater transparency and stakeholder engagement

can be an attractive draw for capital, particularly from impact investors.
Stakeholder engagement is a key part of corporate social responsibility (CSR)

and in achieving the triple bottom line. Companies engage their stakeholders in
dialogue to find out what social and environmental issues matter most to them
about their performance in order to improve decision-making and accountability.
An engaging stakeholder is a requirement of the Global Reporting Initiative, a
network-based organization with sustainability reporting framework that is widely
used around the world. The International Organization for Standardization (ISO)
requires stakeholder engagement for all their new standards. 14
Involving stakeholders in decision-making processes is not confined to corporate

social responsibility (CSR) processes. It is a tool used by matured private and
public sector organizations, especially when they want to develop understanding
and agrees to solutions on complex issues or issues of concern.
1) What is the importance of stakeholder mapping?
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2) Discuss the importance of stakeholder engagement in CSR.

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132 .......................................................................................................................
Stakeholders
1.7 LET US SUM UP
In this unit you have read about the various claimants of the social responsibility
of business. You have also read about the concept of stakeholders, its various
definitions and about the types of stakeholders. Freeman defines stakeholders as
‘any group or individual who can affect or is affected by the achievement of the
organization’s objectives’. This unit further discusses the methods to identify
the stakeholders. The stakeholders can be identified using one or more of these
methods: social data collection, baseline survey, brainstorming and interviews
and focus group discussions. This was followed by a discussion on stakeholder
mapping done to differentiate identified stakeholder groups according to certain
attributes. Finally, you read about prioritization of stakeholders by the organization
to balance the interest of all the stakeholders as well as meet the business
objectives. You have also read about the various benefits of stakeholder
engagement.
1.8 KEYWORDS
Stakeholder: A stakeholder is a party that has an interest in a company and can
either affect or be affected by the business.
Baseline Survey: A baseline survey is a study that is done at the beginning of a

project to collect information on the status of a subject (anything from crop yields
to birth weights) before any type of intervention can affect it.
Stakeholder Engagement: Stakeholder engagement is the process by which an

organization involves people who may be affected by the decisions it makes or
can influence the implementation of its decisions.
Focus Group Discussion: A focus group discussion involves gathering people

from similar backgrounds or experiences together to discuss a specific topic of
interest. It is a form of qualitative research where questions are asked about their
perceptions attitudes, beliefs, opinion or ideas.

Citations:
1) Sharma, J. P. (2016). Corporate Governance: Business Ethics and CSR.
Ane Books Pvt. Ltd., 2nd Edition.
2) Khan, M. T., Khan, N.A., Ahmed, S. and Ali, M. (2012). Corporate Social
Responsibility (CSR) – Definition, Concepts and Scope (A Review).
Universal Journal of Management and Social Sciences.2 (7); pp 41-52.
3) Bucholtz, A. K. and Carroll, A. B. (2011). Business and Society, Ethics and

Stakeholder Management. 8th edition. South-Western. Cengage Learning.
Retrieved from https://www.stakeholdermap.com/what-is-a-stake.html
4) Renard, Y. (2004). Guidelines for Stakeholder Identification and Analysis:

A Manual for Caribbean Natural Resource Managers and Planners.
Caribbean Natural Resources Institute in collaboration with The John D.
and Catherine T. MacArthur Foundation. 133
Stakeholders’ Engagement 5) Bryson, J. M. (2004). What to do when stakeholders matter: Stakeholders
identification and Analysis Techniques. Public Management Review, 6 (1)
pp 21-53.
6) CÍGLEROVÁ, O. (2015). The use of stakeholder analysis in strategic
management. Diploma Thesis
7) https://hub.globalccsinstitute.com/publications/social-site-characterisation-
concept-application/stakeholder-identification
8) https://www.brighthubpm.com/project-planning/99511-methods-of-data-
collection-in-stakeholder-analysis/
9) https://www.bsr.org/reports/
BSR_Stakeholder_Engagement_Stakeholder_Mapping.final.pdf
10) https://www.mindtools.com/pages/article/newPPM_07.htm
11) http://csrandsustainability.com/2-5-prioritization-of-stakeholders/
12) CÍGLEROVÁ Olga (2015). The use of stakeholder analysis in strategic

management. Diploma Thesis
13) https://bimpactassessment.net/sites/all/themes/bcorp_impact/pdfs/
em_stakeholder_engagement.pdf
14) https://en.wikipedia.org/wiki/Stakeholder_engagement
References
Chidambaram, K. and Alagappan, V. (2015). Business Environment. Vikas

Publishing House
Gautam, R. and Singh, A. (2010). Corporate Social Responsibility Practices in

India: A Study of Top 500 Companies. Global Business and Management
Research: An International Journal, 2(1), 41-56.
Krupa, M., Cenek, M., Powell, J. and Trammell, E. J. (2018). Mapping the
Stakeholders: Using Social Network Analysis to Increase the Legitimacy and
Transparency of Participatory Scenario Planning. Society & Natural Resources,
31 (1), 136-141, DOI: 10.1080/08941920.2017.1376140
Neelamegan, V. (2007). Business Environment. Vrinda Publications (P) Ltd.Delhi.
2nd Edition.
Shaikh, S. (2010). Business Environment. Pearson Education New Delhi. 2nd
Edition
http://www.amuldairy.com/index.php/component/content/category/13-csr-
initiatives
https://csrrajasthangov.in/project/khushi+anganwadi+program.html
http://www.emri.in/
https://www.reputationmanagement.com/blog/corporate-social-responsibility-
examples/
https://www.tatamotors.com/corporate-social-responsibility/
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Stakeholders
ANSWERS
Check Your Progress -1
Answer 1. Various parties towards which business organization is socially
responsible include:
1) Employees/workers
2) Shareholders or Investors
3) Consumers
4) Suppliers and Vendors
5) Competitors
6) Government
7) Environment
8) Local community
9) Society
10) Nation
Answer 2. A stakeholder is a person, group or organization that has interest or
concern in an organization. Stakeholders can affect or be affected by the
organization’s actions, objectives and policies.
There are a number of ways to identify stakeholders, for example:
1) Social Data Collection
2) Baseline Survey
3) Brainstorm
4) Interviews & Focus Groups
Answer 1. Mapping stakeholders is a visual exercise and analysis tool that an
organization can use to further determine which stakeholders are most useful to
engage with. Mapping allows to see where stakeholders stand when evaluated
by the same key criteria and compared to each other. The aim of this step is to
differentiate identified stakeholder groups according to certain attributes.
Answer 2. Stakeholder engagement is a key part of corporate social

responsibility (CSR) and in achieving the triple bottom line. Companies engage
their stakeholders in dialogue to find out what social and environmental issues
matter most to them about their performance in order to improve decision-making
and accountability.
135
UNIT 2 NGOs AND COOPERATIVES
Structure
2.1 Introduction
2.2 NGOs in India
2.3 The Collective Impact
2.4 NGO Intervention in Corporate Social Responsibility
2.5 Cooperatives
2.6 Cooperatives and Social Development
2.7 Let Us Sum Up
2.8 Keywords
2.10 Check Your Progress-Possible Answers
2.1 INTRODUCTION
Corporate social responsibility (CSR) is a form of corporate self regulation
integrated into a business model. CSR policy functions as a self regulatory
mechanism whereby a business monitors and ensures its active compliance with
the spirit of the law, ethical standards and international norms. In some models,
a firm’s implementation of CSR goes beyond compliance and engages in actions
that appear to further some social good, beyond the interests of the firm and that
which is required by law. CSR aims to embrace responsibility for corporate actions
and to encourage a positive impact on the environment and stakeholders including
consumers, employees, investors, communities and others. The term ‘corporate
social responsibility’ became popular in the 1960’s and has remained a term
used indiscriminately by many to cover legal and moral responsibility more
narrowly construed.
Non Governmental Organizations (NGO’s) are private voluntary organizations,

not for profits that function as ‘moral entrepreneurs’ selling ethical ideas and
standards. They have played major role in solving social and environmental issues
from driving inter governmental negotiations, to regulations of hazards of waste
and elimination of slavery. A cooperative is an autonomous association of persons
united voluntarily to meet their common economic, social and cultural needs
and aspirations through a jointly owned and democratically controlled enterprise.
In this unit you will learn about the role of NGOs and cooperatives in furthering
CSR initiatives.
After reading this unit you will be able to
Discuss the role of NGOs in CSR initiatives
Explain how a company can identify the right NGO for its CSR initiatives
Discuss the role of co-operatives in CSR initiatives
2.2 NGOs IN INDIA

A non governmental organization (NGO) is any non profit, voluntary citizen’s
136 group which is organized on a local, national or international level. Task oriented
and driven by people with a common interest, NGOs perform a variety of services NGOs and Cooperatives
and humanitarian functions, bring citizens’ concerns to governments, advocate
and monitor policies and encourage political participation through provision of
information. Some are organized around specific issues, such as human rights,
environment or health. They provide analysis and expertise, serve as early warning
mechanisms and help monitor and implement international agreements.
In India, it was the 1970s which saw rapid growth in the formation of formally
registered NGOs and the process continues to this day. Most NGOs have created
their respective thematic, social group and geographical priorities such as poverty
alleviation, community health, education, housing, human rights, child rights,
women’s rights, natural resource management, water and sanitation; and to these
ends they put to practice a wide range of strategies and approaches. Primarily,
their focus has been on the search for alternatives to development thinking and
practice; achieved through research, community capacity building and creation
of demonstrable models.
2.2.1 Role of NGOs in CSR Initiatives

Although in general the majority of businesses are still in the early stages of
developing collaborations with NGOs, a wave of companies both new and long–
standing are taking the lead in bringing business, financial and human resources
as well as a systems approach to the job of bridging India’s wide gap between
the rich and the poor.
Emerging Trends in Business – NGO Partnerships in India
a) Growing business demand for community programmes and
engagement with NGOs
CSR initiatives in India are driven in part by the CSR guidelines that either
compel state owned companies or put pressure on non-state owned companies
and also by company driven moral drivers to participate in the ‘betterment of
society’. Many companies have started up CSR departments and new community
development programmes in the last few years and all see this as a growing
trend. Whether initiating from external or internal drivers, the trend appears to
be ‘infectious’ and is causing slow but incremental growth in business-NGO
collaboration. There is a strong sense from companies that CSR and community
development involvement will soon be mandatory or considered ‘essential’ and
that the years to come will see increased investment in organization and
management in this area.
b) Innovative Approaches from Business, Government and NGOs are

Emerging
A new paradigm of ‘shared value’ or ‘inclusive business’ that sees business

opportunities in development challenges has emerged. This new phenomenon
sees large Indian companies increasingly address social issues as business
propositions, such as low cost housing, healthcare and education solutions for
the bottom–of-the-pyramid populations. Examples of companies that have
developed for underserved markets appropriate products include Tata, Nokia,
Godrej, Datawind, MCX, ICICI Bank, Hindustan Unilever and Airtel. Examples
of social enterprises include Lifespring hospitals, HarWa and Selco. NGOs and
governments are adopting new approaches too, particularly in agriculture, green 137
Stakeholders’ Engagement tech, skills and technology. Pratham, Naandi Foundation, Business Community
Foundation and Bhavishya Alliance have all advanced approaches to engaging
business in development.
2.3 THE COLLECTIVE IMPACT

With corporate social responsibility (CSR) being made mandatory in the form of
Section 135 of the Companies Act 2013, corporates have now begun to recognize
CSR as a core activity, and are looking to find innovative ways to effectively
utilize their CSR fund. This has brought to the fore the role that NGOs and other
implementing agencies can jointly play along with corporates in order to achieve
what is known as collective impact.
Let us take for example collaboration that led to a very effective outcome is that
of Bharti Airtel, Star Global Resources and IFFCO Kisan Sanchar Limited (IKSL)
where they empowered the farmers by providing them information and services
such as free voice messages and a dedicated helpline to interact with experts
through a communication network.
Another good example is the association between Save the Children (a non profit
organization) and global health care giant GlaxoSmithKline that are collaborating
in an innovative initiative to transform an antiseptic (used in mouthwash) into a
life saving product for new born babies. Collaborations and associations make
an effective business case with respect to achieving maximum impact for a given
capital investment.
2.3.1 Non-Governmental Organizations and Corporate Social

Responsibility
Many non governmental organizations in India are engaged in social development
and environmental activities. These organizations are good enough to support
industrial development by ensuring community participation in the developmental
process. The concept of corporate social responsibility is underpinned by the
idea that corporations can no longer act as isolated economic entities operating
in detachment from broader society. Corporate social responsibility is to be looked
upon as mutual support programmes that ensure the development of community
near the industrial area along with the expansion and development of the industrial
organizations. The community today needs external agencies to help alleviate
many social problems like poverty, health, unemployment, community education,
homelessness and eco development programs. By looking upon the needs of the
community, the organization gets an opportunity to understand the social needs
of the people and it will enable them to intervene into such social issues and
finding solutions to the many basic needs. It develops greater trust and confidence
of the community on the business organization’s effort in their real development.
The NGOs existing within the industrial location and closer to the community
can better act as moderators and facilitators in the realization of their social need
and better environmental protection. To develop a better rapport with the
community in the implementation of the developmental activities, the NGOs
can play a better role with the industry and community. They can help the industrial
management in communicating the expansion programme to the community and
thereby developing a proactive and social environmental and industrial
development policy. Lower operating costs, enhanced brand image and reputation,
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reduced regulatory oversight, product safety and decreased liability, improved NGOs and Cooperatives
financial performance, etc., are the benefits to the organization. The benefit is
not only for the community and organization but also for the employees.
CSR supports charities to fulfill legal obligation while generating goodwill. For
many of India’s most loved brands, ‘giving back’ is not about just fulfilling legal
obligation but generating goodwill in their respective communities. There are
times when CSR and NGOs go hand-in-hand. Companies, therefore, must spend
in areas like literacy, women’s empowerment, environment, water, sanitation,
child rights, etc. Most companies around the world allocate 100% of their
resources before they consider the need of CSR. The same holds true for India,
and even after allocating CSR funding, and engaging employees with a mission
of social good, companies struggle with their project’s sustainability.
2.4 NGO INTERVENTION IN CORPORATE

SOCIAL RESPONSIBILITY
Many companies simply do not have the bandwidth (employees, consultants and
supervision) to undertake consistent CSR implementation. These companies not
only need to spend on CSR, but also on CSR training for their employees, or
adding manpower dedicated to CSR capability. NGO’s in India pitch a
streamlined, customized solution to these corporations. For NGOs, corporates
are not only a source of consistent funding but also access to strategic resources.
An IT giant, for example, can provide technology, processes, and support for
educational initiatives.
2.4.1 A look at India’s NGO sector

India possibly is home to the world’s largest number of active not-for-profit
NGOs. At last count, India had 31 lakh NGO - one NGO for about 400 Indians.
With the boom in CSR funding, this number can cross 40 lakh - considering that
there are thousands of public and private sector companies worth Rs.15,000 to
18,000 crores in their CSR kitty annually. This number doesn’t even include
India’s actual number of NGOs, as many aren’t formally registered under the
Societies Registration Act 1860, or any other Acts pertaining to non-profit
organizations.
2.4.2 How does a company identify the right NGO for CSR
intervention?
With this veritable ocean of NGOs, it isn’t easy to pick the right one for a company
to engage in CSR intervention. Companies not only must allocate funds, but also
work with the NGO on CSR interventions. This requires the need for effective
monitoring and evaluation mechanisms in place. Many large corporates, like
Godrej, Reliance, Wipro, Infosys, Tata, and the Birlas have established their
own Foundations and Trusts to achieve this. It is critical for a company to rate an
NGO on parameters while short listing one for CSR implementation. Some of
these parameters are listed below:
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Stakeholders’ Engagement i) Years in operation
It is important for a corporate to work with an NGO that has demonstrated
years of experience and reliability. During this time, it must have mobilized
resources, infrastructure and people for a social cause.
ii) Geography
Companies should preferably look for an NGO near the project area. This
not only ensures easier logistics, but also an intimate understanding of the
local needs, geography, language, culture, etc. The NGO preferably must
situate offices or centers with connectivity and other resources in these
locations, to efficiently execute projects.
iii) Reputation
Transparency, accountability and measurable change in a social welfare
context are how an NGO’s reputation can be measured. This gives an NGO
credibility, making it trustworthy of using corporate assets and funding for
CSR goals.
iv) Certification (e.g., filing for donation tax return)

Certification allows corporates to assess if an NGO complies with legal
norms, as legal issues can compromise CSR implementation. Certification
includes Income Tax exemption, FCRA, service tax, and also proper internal
documentation in case an audit is requested.
v) Relevant experience
An NGO must have shown work in projects relevant to the corporate’s
CSR goals. Coca Cola India, for example, devotes a substantial amount of
CSR efforts to water sustainability, conservation, and sanitation. These
projects must be corroborated with completion certificates from clients.
vi) Leadership
The NGO’s leadership must be well known promoters, with no legal
proceedings or controversies to their name.
vii) Credentials
An NGO’s credentials can also be ascertained via certificates, awards, news
coverage, and membership of NGO and corporate bodies like CII, Chamber
of Commerce, etc.
2.4.3 Case studies of Save the Children’s CSR work with leading
multinational corporations:
Here are some case studies from two of the world’s most well known brands in
telecom (Nokia) and a furniture and home accessories group of companies
(IKEA), which show how a company’s strengths can be leveraged for social
change by Save the Children.
1) Nokia
Disaster Risk Reduction: Working with Nokia, Save the Children
established a new information technology based disaster risk reduction
140
project. This initiative is working on building resilience of children and NGOs and Cooperatives
communities in emergencies. Some of its initiatives include:
i) Delhi:
The Making Schools Safer programme was initiated across 31 slum pockets,
covering 50 schools and reaching over 2 lakh people. It is today preparing
children and communities to identify daily risks faced by children, and
respond to them using IT. Detailed risk assessment has been carried out,
and the NGO is establishing resource centers across schools.
ii) Disaster struck and disaster prone regions

Nokia is working to provide advanced communication connectivity via its
telecom technologies in these regions. This includes access to safety maps
and plans, alternate routes and safe zones, real time coordination with
community members, and mobile based training and education. The project
was deployed in six pilot villages in early 2016, followed by projects across
350 villages and urban settlements across Bihar, Rajasthan, Delhi, Andhra
Pradesh, and Tamil Nadu.
iii) Empowering Accredited Social Health Activists (ASHAs)

Accredited Social Health Activists (ASHAs) or community health workers
were armed with mobile phones that can store medical information, which
is hosted on a cloud server using GPRS. They met pregnant women and
new mothers, to advise on maternity health and infant health, via the phones
which also feature text and audio messages on breastfeeding and importance
of institutional delivery. The activists also used the phone to schedule
appointments and access patient records. With the NGO’s input, pregnancy
and newborn care mobile health applications (called ‘Comm Care’) were
developed.
2) IKEA
i) Freeing children from cotton farming labour:
The IKEA Foundation and Save the Children came together for a €7 million
programme to protect eight lakh children living in cotton communities in
the states of Punjab, Haryana and Rajasthan, after a successful debut across
1,866 villages of Gujarat and Maharashtra where over 65,000 children were
moved to classrooms from the bondages of child labour. Thousands of
farmers also pledged to make their farms child labour free.
ii) Disaster relief: 2012 Assam floods:

Save the Children with support from IKEA Foundation provided malnutrition
screening, followed by access to Save the Children’s Nutrition Rehabilitation
Centre (NRC) facilities, where they are monitored and provided nutritional
care and support. Pregnant and lactating mothers in flood-hit Assam were
taught healthy recipes and low cost, dry food for children to improve
children’s nutritional status. To fight contamination caused by the Assam
floods, children and families were engaged in awareness drives on health
and hygiene to encourage safe hygiene practices.
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Stakeholders’ Engagement iii) Solar lamps
For every SUNNAN solar power lamp bought by IKEA customers, the IKEA
Foundation donates one to UNICEF and Save the Children to help children
play, read, write and study after dusk.
Activity 1
Visit a CSR project being implemented by an NGO in the city of your residence.
Write about the CSR activity being undertaken by the NGO and name of the
corporate for which the activity is being undertaken.
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1) What is the relationship between corporate social responsibility and NGOs?
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2) Briefly discuss NGOs intervention in corporate social responsibility?

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2.5 COOPERATIVES
Groups of individuals around the world and throughout time have worked together
in pursuit of common goals. Examples of cooperation, or collective action, can
be traced back to our prehistoric predecessors who recognized the advantages of
hunting, gathering and living in groups rather than on their own. The earliest
cooperative associations were created in Europe and North America during the
17th and 18th centuries. These associations were precursors to cooperatives.
142
2.5.1 What is a cooperative? NGOs and Cooperatives
The cooperative model has been adapted to numerous and varied businesses. In
1942, Ivan Emelianoff, a respected cooperative scholar, remarked that “the
diversity of cooperatives is kaleidoscopic and their variability is literally infinite.”
As a consequence of this diversity, no universally accepted definition of a
cooperative exists. Two definitions however are commonly used. According to
the International Co-operative Alliance (ICA), “A cooperative is an autonomous
association of persons united voluntarily to meet their common economic, social
and cultural needs and aspirations through a jointly owned and democratically
controlled enterprise”. Cooperative leaders around the world recognize the ICA,
a non governmental organization with over 230 member organizations from over
100 countries, as a leading authority on cooperative definition and values. The
ICA definition recognizes the essential element of cooperatives: membership is
voluntary. Coercion is the antithesis of cooperation. Persons compelled to act
contrary to their wishes are not fully cooperating. True cooperation with others
arises from a belief in mutual help; it can’t be dictated. In authentic cooperatives,
persons join voluntarily and have the freedom to quit the cooperative at any
time.
Another widely accepted cooperative definition is the one adopted by the United
States Department of Agriculture (USDA) in 1987: ‘A cooperative is a user-
owned, user-controlled business that distributes benefits on the basis of use’.
This definition captures what are generally considered the three primary
cooperative principles: user ownership, user control, and proportional distribution
of benefits. The ‘user-owner’ principle implies that the people who use the
cooperative (members) help finance the cooperative and therefore, own the
cooperative. Members are responsible for providing at least some of the
cooperative’s capital. The equity capital contribution of each member should be
in equal proposition to that member’s use (patronage) of the cooperative. This
shared financing creates joint ownership (part of the ICA cooperative definition).
The ‘user-controlled’ concept means that the members of the cooperative govern
the business directly by voting on significant and long term business decisions
and indirectly through their representatives on the board of directors.
2.5.2 Steps to form a cooperative society in India

All societies must be formed under the Cooperative Societies Act, 1912 or under
the relevant state cooperative laws. Steps involved in the formation of a
cooperative society in India are given below:
Step 1: At least ten individuals who are desirous of forming a society should
come together
To form a society, the law mandates that a minimum of 10 members
having similar aims and objectives to be achieved through the society
for their mutual benefit must show their desire to be part of the society.
Step 2: Selection of chief promoter by the provisional committee

Once a group of individuals decide to form a cooperative society, the
next step is to form a provisional committee of which everyone is a
part. The committee members choose a member to be the chief promoter
of the society either by mutual consent or by majority.
143
Stakeholders’ Engagement Step 3: Deciding a name for the society
The next step after selection of the chief promoter is to decide upon a
name for the cooperative society which they wish to form
Step 4: Application has to be made to the registration authority

After selection of the name of the society, they have to make an
application to the registration authority stating their intention to form a
society and the name of the society has to be given to the authority for
its approval. The registering authority has to confirm that name is in
conformity with laws and issue a confirmation certificate to the
members. Once the society name is approved by the authority, it is
valid for 3 months from the date of approval.
Step 5: Entrance fees and share capital

Once the name is approved by the concerned authority, the entrance fee
and share capital must be collected from the prospective members so
as to meet the statutory requirements under law.
Step 6: Opening a bank account

Once the prescribed fee and share capital is collected from the
prospective members, then the promoter has to open a bank account in
the name of the society and deposit the said fees and share capital in
that account and a certificate has to be obtained from the bank to that
effect.
Step 7 Application for registration

After opening the bank account and depositing the fee and share capital,
the promoter has to apply for the society formation to the registration
authority and it has to be accompanied with a set of documents, which
are given below:
1) Form No. A in quadruplicate signed by 90% of the promoter members
2) List of promoter members
3) Bank certificate
4) Detailed explanation of working of the society
5) Four copies of proposed laws of the society
6) Proof of payment of registration charges
7) Other documents such as affidavits, indemnity bonds, any documents
specified by the Registrar also have to be submitted.
All these documents have to be submitted at the time of applying for
registration of the society to the registering authority and the authority,
after it is satisfied with the documents submitted to it. has to apply its
mind to whether or not to register the said society.
Step 8: Acknowledgement of the receipt of the application by the Registrar

The particulars of the application submitted are then entered in the
Register of Application by the registrar of that municipal ward and a
serial number is given to the application. A receipt is then issued to the
144
members for them to follow up on the status of their application. The NGOs and Cooperatives
registrar after perusal of the records submitted has to decide on the
issuance of the certificate of registration. If there are any discrepancies
noticed, then it has to be informed to the members for rectification.
Step 9: Registration
The final step involves notification of the registration of the society in
the official gazette mentioned by the state or central government. Finally,
the registration certificate of the society is issued and given to the
members of the society.
2.5.3 Why cooperate?

People who organize and belong to cooperatives do so for a variety of economic,
social, and even political reasons. Cooperating with others has often proven to
be a satisfactory way of achieving one’s own objectives while at the same time
assisting others in achieving theirs. Farmers create farm supply and marketing
cooperatives to help them maximize their net profits. This requires both effective
marketing of their products for better prices as well as keeping input costs as low
as possible. The farmers recognize that they are usually more efficient and
knowledgeable as producers than as marketers or purchasers. By selling and
buying in larger volumes they can also usually achieve better prices.
2.6 COOPERATIVES AND SOCIAL

DEVELOPMENT
In the early stage, the cooperatives were started mainly to take care of the financial
needs of farmers at certain critical times like seeding, harvesting, etc. Till the
cooperatives were started, the farmers were mainly depending on the money
lenders of the region. There was virtually exploitation of the farmers by the few
money lenders. Today, to a great extent, the financial need of the farmers is taken
care of by the primary cooperative societies, doing lending activities. It is
estimated that about 65 per cent of the rural credit is being taken care of by
cooperatives. These rural cooperatives have also involved themselves in
procurement and distribution of the inputs required for agriculture purpose.
Through these activities they make available the quality inputs at optimum prices
to the farmers. Otherwise the farmers would have depended on middlemen for
this requirement. The dairy cooperatives have provided gainful employment and
dignity to many households in the rural areas. The success of the dairy
cooperatives could be seen in the states like Gujarat, Maharashtra, Karnataka,
Andhra Pradesh, etc. Amul experiment has been acclaimed as a great success
and the same pattern is being adopted in many other states. The involvement of
women in the rural areas in milk production is a unique contribution of this
movement. Otherwise the rural women in India always played a secondary role
and they lacked self-confidence. Through the dairy movement, they have not
only got gainful employment but also revived their rightful existence and attained
dignity. The sugar cooperatives in Maharashtra is another example of successful
socio-economic transformation of the rural sector. Some of the examples are
Warnanagar Cooperative Sugar Industry, Pravaranagar Cooperative Sugar
Industry, etc. They have been able to not only provide economic gains but have
also contributed in many other ways. They have developed rural complexes which
145
Stakeholders’ Engagement include all types of facilities like education, hospitals, entertainment centers,
consumers’ cooperative stores, etc. They are certainly models for emulation by
others. In fact, they are classic examples of how cooperative movement could be
contributing to the socio-economic development of India by upgrading the rural
sector.
Cooperatives provide a platform especially for women to come together and

thereby acquire better bargaining power. Women are active in most types of
cooperatives, such as banks, dairy, consumers, agricultural marketing, fisheries,
thrift and credit and industrial cooperatives. Women cooperatives play a valuable
role in sustained social development.
2.6.1 Examples of Successful Cooperatives:

i) GCMMF- It was formed in 1948, it is a cooperative brand managed by a
cooperative body, the Gujarat Co-operative Milk Marketing Federation Ltd.
(GCMMF), which today is jointly owned by 3.6 million milk producers in
Gujarat.
ii) Bhramaramba Society: is situated at Kurnool of Andhra Pradesh. This
Bank has given loans worth almost Rs.50 lakh to over730 poor families.
The recovery rate is a whopping 98 per cent. Registered under the State’s
‘Mutually Aided Cooperative Society Act’, 1995, on 15th August, 1998,
the bank had 2,400 women members. Only women sit on its 22-member
board and all women staff handles banking operations. The seeds of
Bhramaramba Bank were sown in 1995,when poor women in 22 villages
of the Midthura Mandal (administrative block) were encouraged to form
thrift and microlending self help groups. This social mobilization initiative
encouraged them to form thrift and microlending self help groups. This
social mobilization initiative is a part of the United Nations Development
Programme (UNDP) funded South Asia Poverty Alleviation Programme
(SAPAP) and is implemented jointly by the United Nation’s Development
Programme and the State Government. It has taken roots in 20 mandals
across the district of Kurnool, Anantapur and Mahabub Nagar. The ability
of women to take critical decisions has come to the fore in the whole process.
The members of Bhramaramba Bank have utilized loans for animal
husbandry (48 per cent), agriculture and allied activities (28 per cent) and
for petty business (16 per cent).
State policy under planning gives a great deal of importance to cooperatives
as a desirable form of organization to enable small farmers, households
and cottage industries to acquire greater bargaining strength in the economy
vis-a-vis the big players, through access to credit, input and produce markets.
More generally, the concept of organizing economic activity in a spirit of
mutual help and managing them democratically for the benefit of members
rather than for profit had a wider moral and ideological appeal to the leaders
of that time. This is reflected in the prominence given to cooperation in the
early five year plans and the vigorous efforts to encourage, promote and
support cooperatives. As a result, there has been a phenomenal expansion
in the number of societies and the range of activities. With a few significant
exceptions, this growth is largely driven and sustained by government
decisions on the allocation of budgetary funds, and on its policy of targeted
expansion of public funding of cooperatives at low rates of interest.
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Check Your Progress - 2 NGOs and Cooperatives

1) What is a cooperative?
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2) Give an example of a successful cooperative.

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2.7 LET US SUM UP

With Corporate Social Responsibility (CSR) being made mandatory in the form
of Section 135 of the Companies ACT 2013, corporates have now begun to
recognize CSR as a core activity and are looking to find innovative ways to
effectively utilize their CSR fund. This has brought to the fore the role that NGOs
and other implementing agencies can jointly play along with corporates in order
to achieve what is known as collective impact. In this unit you have read about
role of NGOs and cooperatives in CSR implementation. How to identify the
right NGO for CSR intervention has also been discussed. You have read about
the NGO intervention in CSR and also about role of cooperatives in social
development.
2.8 KEYWORDS
NGOs: A non-governmental organization (NGO) is a non-profit, citizen-based
group that functions independently of government.
Cooperatives: Cooperatives are people-centred enterprises owned, controlled

and run by and for their members to realise their common economic, social, and
cultural needs and aspirations.
Cooperative society: A cooperative society is a voluntary association that started

with the aim of the service of its members.
Social Development: Social Development refers to how people develop

social and emotional skills across the lifespan, with particular attention to
childhood and adolescence. 147
Sharma, S.G. (2009). Corporate Social Responsibility in India: An Overview.
The International Lawyer. 43 (4) pp. 1515-1533
Praveenraj, D. W. and Viajayalakshmi, R. (2014). Role of NGOs in CSR.

International Research Journal of Business and Management, VII (12)
https://www.savethechildren.in/role-of-ngo-in-corporate-social-responsibility-act
2.10 CHECK YOUR PROGRESS-POSSIBLE

ANSWERS
Answer 1. Many non governmental organizations in India are engaged in social
development and environmental activities. These organizations are good
enough to support the industrial development by ensuring community
participation in the developmental process. The concept of corporate social
responsibility is underpinned by the idea that corporations can no longer
act as isolated economic entities operating in detachment from broader
society. Corporate Social Responsibility is to be looked upon as mutual
support programs that ensure development of community near by the
industrial area with the expansion and development of the industrial
organizations.
Answer 2. Many companies simply do not have the bandwidth (employees,

consultants and supervision) to undertake consistent CSR implementation.
These companies not only need to spend on CSR, but also on CSR training
for their employees, or adding manpower dedicated to CSR capability.
NGO’s in India pitch a streamlined, customized solution to these
corporations. For NGOs, corporates are not only a source of consistent
funding but also access to strategic resources. An IT giant, for example,
can provide technology, processes, and support for educational initiatives.
Answer 1. According to the International Co-operative Alliance (ICA): a
cooperative is an autonomous association of persons united voluntarily to
meet their common economic, social and cultural needs and aspirations
through a jointly owned and democratically controlled enterprise.
Answer 2. Example of a successful cooperative
GCMMF- It was formed in 1948, it is a cooperative brand managed by a
cooperative body, the Gujarat Co-operative Milk Marketing Federation Ltd.
(GCMMF), which today is jointly owned by 3.6 million milk producers in
Gujarat.
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NGOs and Cooperatives
UNIT 3 CSR AND GOVERNMENT
PROGRAMMES
Structure
3.1 Introduction
3.2 Formalizing Corporate Social Giving in India
3.3 Role of Government in Supporting CSR
3.4 Good Practices to Foster CSR
3.5 Public Private Partnerships in CSR
3.6 Let Us Sum Up
3.7 Keywords
3.1 INTRODUCTION
In the previous units you learnt about the corporate social responsibility (CSR)
legislation in India and the various provisions under the Companies Act of 2013
which stipulates companies to engage in social development activities through
various means. As the companies begin to acclimatize their operations in light of
the Act and streamline investment for social good, there are important stakeholders
who are required to be involved in the process in order to streamline and maximize
impact on ground. The last unit highlighted the role of NGOs and cooperatives
in engaging with corporates to achieve the provisions mandated in the Companies
Act of 2013. Besides NGOs which are key stakeholders in furthering CSR
initiatives of corporations, the government has an important role to play in
facilitating adherence to CSR provisions in the Companies Act and supporting
CSR activities on ground while ruling out possibilities of duplication. The role
of the government is even more important because the primary onus of social
development lies with it. This unit focuses on understanding the multi-faceted
role of the government in informing, furthering and streamlining CSR activities
to realize the pursuit of social development.
Discuss the role of government in streamlining and supporting CSR
initiatives
Describe government interventions in promoting CSR and fostering best
practices
Illustrate models of government and corporate partnership for furthering
CSR
3.2 FORMALIZING CORPORATE SOCIAL

GIVING IN INDIA
The roots of social investments by profit making entities in India, especially for
the purpose of welfare can be traced back to the principle of ‘giving’ as stipulated
in the Vedas, the ancient Hindu scriptures. The Rig Veda in the Skanda Purana 149
Stakeholders’ Engagement prescribes that a patriarch gives 10% of earned income for public welfare work
(ET Contributors, 2019). The famous Hindu scripture, The Mahabharata also
says that “the one who enjoys abundance without sharing with others is indeed a
thief” (Sanjai, 2014). Thus, the cultural ethos of our country has written down
prescriptions that recommend giving for social good. Over time, the nature of
giving has transitioned from charity to philanthropy. Ramachandran (2009)
differentiates between the two citing that philanthropy is largely driven by feelings
of altruism while charity is often driven by religious and/or moral reasons. Profit
making corporations in the country have a long history of oscillating between
charity and philanthropy. However, in the absence of a regulatory framework,
social investments have largely been voluntary and have fluctuated based on
individual orientation towards societal welfare. With the advent of
industrialization in the country accompanied by the proliferation of profit making
corporations, the government realized the need for a framework standardizing
the nature, type and extent of social investment by profit making entities. Several
other underlying factors such as the pressure on natural resources, exploitation
of the commons led the government to take appropriate measures to orient
corporations to give back to the society from where they run their businesses.
It is in this backdrop that the Companies Act of 2013 was conceptualized with
the integration of Section 135 stipulating companies registering profits worth
Rupees five crore and more in a financial year, to invest two percent of net profits
in social activities. With the implementation of this Act, corporate giving has
been formalized in India which has led to a larger volume of funds being diverted
to addressing social problems in the country. However, the increase in fund inflow
has simultaneously given rise to several issues which have resultantly necessitated
greater involvement by the government at all levels.
Activity 1
Interview four people in the age range of 50-70 years about the forms of
social giving that they witnessed in their years of growing up and how has it
changed over time. List out their answers
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3.3 ROLE OF GOVERNMENT IN SUPPORTING

CSR
Government in the democratic milieu of India has a multifaceted role. While it
provisions for furthering realization of an ideal welfare state, it binds institutions,
whether public or private through various legislations to ensure that the social
fabric remains equitable and welfare driven. In this pursuit, the concept of
corporate social responsibility is provisioned under the Companies Act of 2013.
To ensure that CSR is appropriately understood and implemented, involvement
of the government can be disaggregated at various levels.
150
To understand how the government supports CSR and its practice, let us divide CSR and Government
Programmes
its role into two tiers stratifying it according to the nature and type of involvement.
i) Legislative Support
ii) Strategic Support
3.3.1 Legislative support

The government machinery is responsible for constituting appropriate legislative
provisions to create a framework for ideation and implementation of corporate
social responsibility in the country. The Companies Act of 2013 is one such
legislative provision that you have read in the previous units. The aforementioned
Act outlines the foundational framework specifying the guidelines for companies
that qualify the criteria. Section 135 of the Act specifies that every company
having a net worth of Rupees five hundred crore or more, a turnover of Rupees
one thousand crore or more, or a net profit of Rupees five crore or more in a
financial year is supposed to constitute a corporate social responsibility committee
comprising of at least three directors of which at least one should be independent.
The CSR committee is supposed to formulate and recommend a CSR policy
which is indicative of the activities to be undertaken by the company fitting with
the ones listed in Schedule VII, recommend the amount of expense to be incurred
and monitor the CSR policy from time to time. The board of every company
falling in the ambit of CSR obligation shall ensure that the company spends at
least two percent of the average net profits the company made during the three
preceding financial years (Corporate Social Responsibility, 2019). Besides the
companies qualifying criteria, the Act lays down guidelines that can be utilized
by any agency that wishes to engage in corporate social responsibility.
Even before the inclusion of Section 135 in the Companies Act re-launched in
2013, the Ministry of Corporate Affairs (MCA) released the National Voluntary
Guidelines on Social, Environmental and Economic Responsibilities of Business
(NVGs) in 2011. These guidelines were expected to guide businesses on the
composition of responsible business conduct. Recently, the guidelines have been
revised to integrate the NVGs with Sustainable Development Goals (SDGs) and
also assimilate the ‘Respect’ pillar of the United Nations Guiding Principles
(UNGP). The new principles launched in 2018 are called the National Guidelines
on Responsible Business Conduct (NGRBC) (Ministry of Corporate Affairs,
2018). These guidelines are expected to assist businesses to perform beyond the
regulatory compliances thus paving way for small businesses not falling in the
ambit of CSR to also contribute to the cause of social development in the country.
Irrespective of the ownership, size, structure, sector or location, all businesses
are expected to follow these guidelines through providing a framework that directs
businesses to also encourage and support their suppliers, vendors, distributors,
partners and other collaborators to follow them. The guidelines lay down nine
principles which are interdependent, interrelated and business are expected to
address these holistically while being sensitive to characteristics such as caste,
creed, sex, race, ethnicity, age, color, religion, disability, socio-economic status,
or sexual orientation (ibid, 2018). Following are the nine principles laid out in
the guidelines:
i) Businesses should conduct and govern themselves with integrity, and in a

manner that is ethical, transparent and accountable.
151
Stakeholders’ Engagement ii) Businesses should provide goods and services in a manner that is sustainable
and safe.
iii) Businesses should respect and promote the well being of all employees,
including those in their value chains.
iv) Businesses should respect the interests of and be responsive to all its
stakeholders.
v) Businesses should respect and promote human rights.
vi) Businesses should respect and make efforts to protect and restore the
environment.
vii) Businesses, when engaging in influencing public and regulatory policy,

should do so in a manner that is responsible and transparent.
viii) Businesses should promote inclusive growth and equitable development.
ix) Business should engage with and provide value to their consumers in a
responsible manner.”
(Source: Ministry of Corporate Affairs, 2018).
The guidelines also propose a business responsibility reporting framework which

is not mandatory to be followed but serves as an internal tool for businesses
wanting to align with the principles laid out in the NGRBC. Both, the principles
laid out in the guidelines and provisions in the Act serve as guiding frameworks
for all types of businesses to adopt responsible business practices and align their
conduct with the larger welfare of the society. These also serve as legislative
references that corporates mandated by the Act can use to adhere to the bindings
under the Act.
Besides these, the government has also set up mechanisms to ensure compliance
to the Act. Over a couple of years post implementation of the Act, the government
recognized that several corporate houses falling in the ambit of the Act are not
complying with the provisions mandated therein. Thus, a high level committee
on corporate social responsibility (HLC) was set up under the chairmanship of
the Secretary of Ministry of Corporate Affairs in the year 2018. The objective of
constitution of the committee was to review the existing framework and guide
and formulate the roadmap of a coherent policy on corporate social responsibility.
The committee was also accorded the task of analyzing outcomes of CSR
activities/ programmes/ projects and making suggestions on monitoring and
evaluation mechanisms (Rana et. al, 2018). Alongside, according to the
government notification of 2018, a steering committee on corporate social
responsibility (CSR) was also constituted to revisit the activities listed in Schedule
VII of the Act, to revisit guidelines for enforcement of CSR provisions including
structure of centralized security and prosecution mechanism (CSPM) among other
roles accorded to the committee. For the purpose of aiding the committee’s work,
two sub-committees were constituted:
a) Legal sub-committee for CSR: the legal sub-committee was constituted

with the main purpose of identifying responsibility for non-compliance of
CSR provisions and proposed mechanisms to facilitate adherence to the
provisions of the CSR Act, 2013.
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b) Technical sub-committee for CSR: the technical sub-committee was CSR and Government
Programmes
responsible to verify the data consistency of National CSR Data Portal,
document and segregate the companies falling in the ambit of the Act and
further disaggregate companies based on compliance and non-compliance.
(Source: Government of India, 2018).
The government, in its continued attempt to improve the understanding and

compliance of CSR in the Indian corporate environs reviews the recommendations
of the committees thus constituted. Several attempts are being taken to simplify
procedures related to compliance and adherence to the provisions of the Act
thereby extending legislative support to corporate entities in the country.
3.3.2 Strategic Support

CSR being new to our country, the government has an important role to play in
how the legislative provisions are brought to reality. In that pursuit, role of the
government extends to making available a guiding framework for corporate
entities to make meaningful and impactful contributions towards development
of the country. Schedule VII of the Companies Act is a strategic reference point
in this regard. In resonance with the then Millennium Development Goals focusing
on addressing pressing development issues globally, Schedule VII lists out key
reference points for corporates to align their CSR programmes with. The list
released by the government is neither exhaustive nor mandatory but puts in place
key issues of development that companies can include in their CSR mandate or
policy. These activities are:
a) Eradicating extreme hunger and poverty
b) Promotion of education
c) Promoting gender equality and empowering women
d) Reducing child mortality and improving maternal health
e) Combating human immunodeficiency virus, acquired immune deficiency
syndrome, malaria and other diseases
f) Ensuring environmental sustainability
g) Employment enhancing vocational skills
h) Social business projects
i) Contribution to Prime Minister’s Relief Fund or any other fund set up by
the central government or state governments for socio-economic
development and relief and funds for the welfare of the Scheduled Castes,
the Scheduled Tribes, other backward classes, minorities and women
j) Such other matters as may be prescribed.” (MCA, 2013).
It was in 2014 that the list witnessed its first amendment to include several other
aspects that did not find mention in the first list. The table below highlights the
additions made to the list after the amendment.
153
Stakeholders’ Engagement Table 1: Schedule VII Activity List
Schedule VII Activity List- 2013 Additional domains –2014

(Source: ibid, 2013) (Source: MCA, 2014)
1) Eradicating extreme hunger and Malnutrition, preventive health

poverty care and sanitation, availability of
safe drinking water
2) Promotion of education Special education and vocational

skill enhancement especially
among women, elderly, differently
abled
3) Promoting gender equality and Setting up homes and hostels for

empowering women women and orphans, setting up old
age homes, day care centers and
other facilities for senior citizens
4) Reducing child mortality and None

improving maternal health
5) Combating human immunodeficiency None

virus, acquired immune deficiency
syndrome, malaria and other diseases
6) Ensuring environmental sustainability Ecological balance, protection of

flora and fauna, animal welfare,
agroforestry, conservation of
natural resources and maintaining
quality of soil, air and water
7) Employment enhancing vocational None

skills
8) Social business projects Contribution or funds provided to

technology incubators located
within academic institutions which
are approved by the Central
Government
9) Contribution to Prime Minister’s None

Relief Fund or any other fund set up
by the central government or state
governments for socio-economic
development and relief and funds for
the welfare of the Scheduled Castes,
the Scheduled Tribes, other backward
classes, minorities and women
10) NA Protection of national heritage, art

and culture including restoration of
buildings and sites of historical
importance and works of art,
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CSR and Government
setting up public libraries, Programmes
promotion of traditional arts and
handicrafts
11) NA Measures for the benefit of armed

forces, veterans, war widows and
their dependents
12) NA Training to promote rural sports,

nationally recognized sports,
Paralympic sports and Olympic
sports
13) NA Rural development projects
Besides the additions mentioned in Table 1, slight amendments have followed

ever since. In August 2014, slum area development was added as a separate
domain that corporates can invest in while undertaking CSR. In October of the
same year, contribution to the Clean Ganga Fund set up by the Central Government
for rejuvenation of river Ganga was added to the domain of ensuring
environmental sustainability along with contribution to Swach Bharat Kosh set
up by the Central Government for promotion of sanitation added to the domain
of sanitation. Very recently, in the year 2019, disaster management, including
relief, rehabilitation and reconstruction activities has also been added to the
schedule VII activity list (MCA, 2019). Schedule VII activity list is therefore a
dynamic list which undergoes amendment in view of the domains that emerge as
development priorities for the government. This list is an important strategic
reference support extended by the government in order to help corporate entities
align their CSR mandate and policies with issues of national priority.
1) What steps have been taken by the Government of India to simplify and
improve implementation of CSR provisioned in the Companies Act of 2013?
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2) In what form does the government extend strategic support to companies to

pursue CSR?
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155
3.4 GOOD PRACTICES TO FOSTER CSR
The underlying principle of CSR is creating shared value for all stakeholders
involved in its ideation, execution and process. While business conduct becomes
socially responsive, it also benefits from gaining a socially responsible image
among its targeted consumers thereby giving a thrust to their client base. Parallel
to this, government’s efforts in addressing pressing development issues in the
country are supplemented thereby maximizing outreach and impact. The larger
communities which are the targeted beneficiaries are in turn benefited from
developmental efforts of both, the government and corporate entities thus creating
a win-win situation for all. However, this is an ideal case scenario which is difficult
to achieve in real world. CSR, in common parlance is perceived by civil society
and communities at large as a campaign to create brand mileage which is often
disproportionately high when compared with the effort. Given that corporates
are incepted and run with a profit driven motive, there is a fundamental distrust
of civil society regarding a corporation’s legitimate intention to do any socially
driven work keeping profits on the backburner (Rangan et.al, 2012). With this
being the widely held perception, the government can play a key role in promoting
good practices to foster CSR. These can be as follows:
3.4.1 Raising awareness:

The government needs to raise awareness to inform corporate entities about
pressing development issues the country is grappling with which are also likely
to affect businesses if not dealt with. This is likely to prompt businesses to
recognize and devise solutions to resolve such problems or partner with the
government and/or civil society organizations to further their initiatives towards
addressing these problems. Awareness building will also generate greater
responsiveness from businesses and will lead to a uniform perception regarding
the scope of CSR.
3.4.2 Legislative frameworks:

Government legislations like the guidelines on responsible business conduct and
Section 135 of the Companies Act of 2013 are instruments to keep the companies
better informed of their role in the society and the most appropriate way they can
bring about positive change. These legislations are guiding frameworks for
corporates to steer the introduction of the concept of CSR in business and find
appropriate pathways to weave it into operations with the right orientation. Aligned
with the profit making goal, these frameworks help design the CSR policy and
mandate, an important first starting point in fostering CSR.
3.4.3 Policy making:

one among the best practices to foster CSR is to create policies to set standards.
Legislations that are put in place mandating corporate entities to create a CSR
committee and invest profits in developmental activities are open to irrational
interpretations. Thus, there are several instances where the underlying profit
derivative from a CSR effort of a corporate entity surfaces much before the effort
itself. The government, through policies can set clear standards for pursuing and
achieving the goals which were envisioned while making CSR a stipulation.
Such policies, when put in the public domain can also result in creating positive
156
aspirations among corporates to achieve those standards or go beyond the CSR and Government
Programmes
threshold to not only make a positive impact but also create a socially responsible
image.
3.4.4 Transparency:
The government can play an important role in creating transparency and promoting
access to CSR practice of corporates. Promoting such public disclosure can be
helpful in two ways. One, it helps improve and set higher standards of CSR
practice in the country. Second, it encourages other players to follow suit. Even
though, a number of companies release their impact and CSR investment reports,
these are based on internal assessments and may be deemed as not reporting
precise impact. The government can create a central reporting portal where all
corporate entities investing their resources in development through CSR,
document their activities for every calendar/ financial year. This portal can serve
as not only a reference ground for other aspiring entities which are stepping into
the realm of CSR, but also be a platform where initiatives can find concurrence
and/or converge to make holistic and lasting impact in select geographies or
communities.
3.4.5 Monitoring and evaluation frameworks:

To foster CSR which is impact oriented, the government needs to set up monitoring
and evaluation mechanisms to gauge the impact on ground from CSR initiatives
of corporates. These frameworks will also serve as yardsticks for a corporate’s
internal assessment of its initiatives. From the perspective of governance, these
frameworks will also help the government prioritize developmental domains
which require intensive efforts and supplement or withdraw from domains that
are being taken care of by CSR initiatives to eliminate duplication of efforts.
Additionally, best practices to foster good CSR also include research on

stakeholders involved in a particular CSR programme, ensuring creation of CSR
communications materials, planning ahead, using personal and corporate channels
to convey CSR messages, monitoring contemporary environment for potential
opportunities, leveraging technology tools and adapting to dynamic environments
(Peterson & Jones-Merrill, 2017).
The role of the government is instrumental and imperative in developing and

streamlining practices to foster CSR. It is possible only when the government
works in tandem with the CSR initiatives across the country while having
validated, reliable and scalable tools to measure the impact of such initiatives
and standardized reporting frameworks which not only help streamline the pursuit
of development but also help set standards to better the CSR milieu in the country.
Partnership is key to creating shared value among all stakeholders. The next
section describes a few such public private partnerships in CSR which have
helped generate sizeable impact and positively benefited all stakeholders.
157
Stakeholders’ Engagement Check Your Progress-2
1) What are the good practices that the government should introduce to foster
CSR?
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2) What do you understand by the term shared value in the context of CSR?
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3.5 PUBLIC PRIVATE PARTNERSHIPS IN CSR

Kinnear (2018) remarks that collaboration between the government and private
sector is one of the most effective ways to improve CSR standards in business.
With the government setting minimum business standards, the government can
ensure that the standards are met and at the same time, social objectives are
achieved while government and private spheres work complementarily for
achieving larger social good.
In recent years, CSR has become an integral part of every business portfolio in
India and companies have made significant contributions in the development of
the country through various initiatives in areas such as education, healthcare,
water and sanitation, infrastructure, livelihoods, rural development, and urban
development. The mushrooming of corporate foundations is a significant progress
for CSR in India. Foundations are usually not-for-profit entities set up to conduct
CSR activities. This structure enables them to partner with other organizations
engaged in research and implementation activities. They also work with
government departments to seek alignment with social, environment, or economic
development priorities (Warner, 2014). The government recognizes the role of
business in inclusive growth through sustainable development efforts. While
companies do carry out CSR work independently, many also work in collaboration
with the government in public private partnership mode. In 2012, the Centre of
Excellence for Sustainable Development identified companies which were
carrying out their CSR activities through corporate foundations. Ten companies
were selected based on geographical location and the sector they were working
in. Of the ten companies selected, eight have corporate foundations, the CSR
158
arms that carry out the companies’ development initiatives. Data was gathered CSR and Government
Programmes
through interactions with company representatives, government representatives
and relevant stakeholders. The interventions of these ten companies address issues
of healthcare, livelihoods, education, natural resource management, infrastructure,
community development, and clean energy, while collaborating with the
government. While some initiatives are localized to the needs and conditions of
certain geographical regions, there are some that are being replicated and scaled
at the national level.
Between corporate entities and the government, three types of collaborations

emerge. These are:
1) Where the public partner or the government funds the intervention
completely
2) Where the government funds most of the intervention and the private player
fills in the gaps
3) Where both share costs
While in some cases a private player initiates a project and the government then
takes it up, in other cases the companies leverage an existing public scheme or
intervention. The Centre found that there are definite advantages in public-private
collaborations. While the government has the capacity to contribute financial
resources and provide scale, the private sector, aside from funds also provides
expertise in management, delivery and technology, and is responsible for the
day-to-day management and running of the interventions. Private players are in
a better position to do the groundwork and can mobilize personnel easily since
the government is vulnerable to bureaucratic protocols working on the ground
which negatively affects the interventions. In all ten cases analyzed by the Center,
there is evidence of the community being positively impacted. Public and private
sectors believe that working together in the development sector would achieve
the best results and have the greatest impact.
Activity 2
Read relevant literature on any two public private partnerships which have
helped solve a daunting problem in any of India’s geographical locations.
Identify one such area where public private partnership (PPP) can help solving
a problem in your vicinity.
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State led governments have pursued different strategies in instituting public and
private partnerships (PPPs). For example, the state of Rajasthan adopted a PPP
policy entitled Public Partnership in School Education 2015. This new policy
pilots PPP in 10 primary and secondary schools to improve the quality of education
in government schools (Morgan, 2017) as the state government is concerned
159
Stakeholders’ Engagement with the decrease in the number of enrollments in government schools. Other
than national government initiatives to encourage PPP, there have also been state
level initiatives.
For example, the NIIT, a global IT corporation, works with the state
governments of Tamil Nadu, Karnataka, West Bengal, and Andhra Pradesh in
terms of infrastructure creation, systems integration, facilities management,
education delivery, and teacher training, thereby providing quality computer
education and computer aided education to thousands of schools. Many of
the classrooms in these states have become NIIT centers, which are open to
school children and teachers during the day and then used by the franchise
holder in the evenings. Another state level PPP initiative is in the Gujarat
State of India where schools are jointly financed by the local community and
the government. High school buildings are donated, built, and managed by
local communities.
Example: Another successful example of public private partnerships is a

case of the Biocon Foundation. Biocon Foundation, Biocon’s CSR arm, has
interventions in the areas of health, education and infrastructure. The
Foundation claims that ‘by establishing primary healthcare centers (PHCs),
actively creating awareness about disease prevention, public health and
sanitation, infrastructure building and initiating programmes in education,
they aim to empower underserved communities towards self help, improved
health and in good time, a better standard of living. In 2009, responding to
the disaster Karnataka was facing as a result of heavy rains and subsequent
flooding, the Foundation built a village to rehabilitate and relocate those who
had lost their homes (Agarwal, 2017). The Government of Karnataka initiated
a relocation and rehabilitation scheme called Aasare that would be
implemented through public-private partnership. Villages located on the banks
of the Malaprabha River were relocated to higher grounds. Biocon, along
with other companies, was invited to help rebuild villages at new locations.
The new village has been built about a kilometer away from the old one, so
the community has not been relocated a great distance away. Biocon
Foundation has built 411 houses, which were allotted in December 2012,
with ownership given to the new residents. There are about 2,000 old and
new check dams in tribal dominated Dang region of Gujarat which were in
need of renovation. Gujarat CSR Authority (GCSRA), an initiative of Gujarat
government, with the support of leading corporate groups have undertaken
three projects for repair of check dams in the district (Tiwari, 2018).
These examples are indicative of the fact that if public administrations mobilize
their resources in order to create and regularly update a list of needs, it is helpful
for civil society, corporate foundations and communities at large to jointly plan
CSR interventions with the private sector. Partnerships are useful and impactful
especially in scenarios where public sector is incapable to provide direct services
in response to social and environmental needs, or where the private sector can
provide them more efficiently.
160
Check Your Progress-3 CSR and Government
Programmes
1) What are the three types of public private partnerships in the context of
CSR?
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2) Citing a few examples, explain how public private partnership can be useful
in furthering CSR initiatives?
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3.6 LET US SUM UP

The objective of CSR to promote responsible businesses and further development
can be realized only with the government playing an active role in its ideation
and execution. Besides the legislative and strategic support that the government
can provide for furthering CSR, the government has to be instrumental in devising
mechanisms to ensure convergence of interventions on ground. It also is
responsible to set industry standards that become standardized reference points
of aspiration and achievement in CSR. Complementarity of efforts on ground is
essential to ensure that the benefits of CSR can be reaped optimally. This can
only be possible through innovative public private partnership models being
created and replicated all over the country.
3.7 KEYWORDS
Responsible business conduct: The operational protocol of a business which is
driven by principles of social sensitivity and responsiveness.
Shared value: Reciprocal benefit derived out of a partnership or activity which

fetches benefit to all the stakeholders involved.
Convergence: Ensuring complementarities of efforts such that impact of an

initiative is maximized and duplication is eliminated.
Public private partnerships: Partnerships that are initiated between a

government/ public funded institution and a private company/ institution or entity. 161
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3ezHoN/Philanthropy-in-India-an-ageold-tradition.html
Tiwari, A.M. (March, 2018). Why Public Private Partnership is no longer an

option to be considered but a reality to be acknowledged. FirstPost. Retrieved
from https://www.firstpost.com/business/why-public-private-partnership-is-no-
longer-an-option-to-be-considered-but-a-reality-to-be-acknowledged-
4377905.html
Warner, T.; Pandey, S.; & Gupta, P. (2014). Public-Private Partnerships in CSR
in India: Ten Demonstrative Case Studies. CII-ITC Centre of Excellence for
Sustainable Development. Retrieved on August 2, 2019 from
h t t p s : / / w w w. s u s t a i n a b l e d e v e l o p m e n t . i n / u p l o a d s / p d f /
1445609929Public_Private_Partnerships_in_CSR_in_India.pdf

ANSWERS
Answer 1. The government has set up a high-level committee and a steering
committee to improve the understanding and compliance of the CSR Act.
The overarching objective of these committees was to review the existing
framework of the Act and formulate a roadmap of a coherent policy on
CSR alongside proposing ways to monitor and evaluate extent and impact
of adherence.
Answer 2. The government, as part of the Companies Act of 2013 has schedule
VII which scopes out a list of domains that corporate entities designing
CSR projects can refer to and align. These domains are strategic reference
points for all organizations/ institutions and companies and correspond to
the pressing developmental issues in the country as well as globally.
Answer 1. Raising awareness among corporates about pressing social issues,
creating legislative provisions to provide legal frameworks promoting
adherence toconduct businesses responsibly, formulating policies to set
standards, promoting transparency and access to CSR practice of companies,
formulating monitoring and evaluation mechanisms to gage the impact
created on ground are some of the good practices to foster CSR.
Answer 2. Shared value implies creating a win-win situation for all stakeholders
involved in an initiative. In the context of CSR, this implies that besides a
profit motive, the company engages in CSR activities in a way which not
163
Stakeholders’ Engagement only increases its brand value but also contributes to corresponding
development issues thereby benefiting communities at large and
complementing government efforts.
Answer 1. Between corporate entities and the government, three types of
collaborations are possible. These are, a partnership where the public partner
or the government funds the intervention completely, a partnership where
the government funds most of the intervention and the private player fills
in the gaps and a partnership where both public and private partner share
costs.
Answer 2. Public private partnerships can be useful in complementing efforts

of each other while using each other’s strengths. One such example is that
of NIIT, a global IT corporation which is working with state governments
of Tamil Nadu, Karnataka, West Bengal, and Andhra Pradesh for
infrastructure creation, systems integration, facilities management, education
delivery, and teacher training, thereby providing quality computer education
and computer-aided education to thousands of schools. Another example is
that of Karnataka where after the floods in 2009, the Government of
Karnataka initiated a relocation and rehabilitation scheme called Aasare in
which villages located on the banks of the Malaprabha River were relocated
to higher grounds. Biocon, along with other companies, was invited to help
rebuild villages at new locations and the villagers were comfortable shifted
to new villages located at a short distance from their previous habitation
zone.
164
CSR and Government
UNIT 4 CORPORATE FOUNDATIONS Programmes
Structure
4.1 Introduction
4.2 What is Corporate Foundation
4.3 Role of Corporate Foundations in Corporate Philanthropy
4.4 Types of Non Profit Organization
4.5 Establishing a Trust
4.6 Establishing a Society
4.7 Establishing Section 8 Companies
4.8 Success Stories of Corporate Foundations in CSR
4.9 Let Us Sum Up
4.10 Keywords
4.1 INTRODUCTION
India has the world’s richest tradition of corporate social responsibility. Though
the term CSR is comparatively new, the concept itself dates back to over a hundred
years. CSR in India has evolved through different phases, like community
engagement, socially responsible production and socially responsible employee
relations. One of the most significant reasons for a business to get involved in
corporate philanthropy is their own survival. The Council on Foundations has
pointed out that without healthy communities, healthy companies simply cannot
exist. Nowadays business organizations have put corporate giving and CSR at
top priority because it helps the organization to connect with community.
Corporate foundations are a good approach to organize and manage philanthropic

activities for business giants who participate actively in such activities. The role
of foundations in corporate philanthropy is constantly evolving. A corporate
foundation increases the visibility of a corporate brand by creating its distinct
image in the mind of a community. Foundations have two primary benefits. They
can improve the local community through charitable programmes or corporate
giving to nonprofits, and they can also improve the company’s financial results.
All companies are interested in increasing profits. Forming a corporate charity
can be a great way to improve the bottom line by generating goodwill in the
community and benefiting from the positive marketing that can come from it. 1
Differentiate between trusts, societies and Section 8 companies
Explain the role of corporate foundations in CSR
Discuss about the establishment of a trust
Discuss the establishment of a society
Discuss the requirements of establishing a Section 8 Company
165
4.2 WHAT IS CORPORATE FOUNDATION?
“We have been doing CSR since the 80s, but when the mandate came we decided
to set up a foundation because it helps bring in better corporate governance as
it requires one to set up a separate board dedicated to this entity,”
Sanjutha Sharma, CSR head of the SBI Foundation.
Opening Cases
AKSHAYA PATRA FOUNDATION
The Akshaya Patra Foundation has implemented the Mid-Day Meal Scheme
in the government schools and government-aided school to satisfy appetite of
the students. In the same direction, it also focuses upon the food nutrition and
supports the poor children in getting education.
Since 2000, Akshaya Patra has been putting all its efforts towards providing
fresh and nutritious meals to children on every single school day. For this
purpose it is taking help of latest technology to have just-in-time approach.
It has partnership with the Central Government and various State Governments,
along with the persistent support from corporate, individual donors, and well-
wishers.
Today, Akshaya Patra is the world’s largest (not-for-profit run) Mid-Day Meal
Programme serving wholesome food every school day to over 1.8 million
children from 16,856 schools across 12 states and 2 Union territories of India.
Initially the figure was just 1,500 children in 5 schools in 2000. (For more
details visit https://www.akshayapatra.org/)
AXIS BANK FOUNDATION

Axis Bank Foundation (ABF), a registered trust was formed in 2006 to
contribute to society much more than just providing trustworthy and excellent
bank services. ABFs initial programmes focused on education and highway
trauma care.
Over the years, the Foundation has evolved its approach to meet the
contemporary needs of society and aligned all its activities under a unified
programme aimed at creating sustainable livelihoods.
Under this, ABF creates opportunities for small, marginal farmers and landless
to generate incomes sources from agri and agri allied activities, and natural
resource management. ABF also emphasizes on developing vocational skills
for disabled and unemployed youth of the country. ABF has partnership with
several not-for-profit organizations who also think in the same way to co-
create need based programmes. (For more details visit: http://www.
axisbankfoundation.org/)
Corporate foundations in India are not a new phenomenon. The wealthy of the
pre independence era, prompted by the traditions of their community or
encouraged by the Gandhian principle of Trusteeship, were generous in giving
back to society.
Their humanitarian contributions were not limited to donating to the poor; some
166 goodhearted persons were also involved in setting up some of the most famous
institutions in the country – for example: Jagannath Shankarshet (1803–65), Corporate Foundations
Jamsetji Jeejeebhoy, or ‘J J’ (1783–1859), Sir Jamsetji Tata (1839 -1904) and G
D Birla (1894 – 1983) have contributed towards setting up institutions such as
Elphinstone College, JJ School of Art and Mahim Causeway, Indian Institute of
Science and Birla Institute of Technology respectively.
Over the years, foundations established by companies in India have assumed
various forms in terms of their legal status, focus, funding, operations and
activities. But the stated focus remains the same: social development, and
empowerment of the poor and disadvantaged, in many cases, in the areas where
the companies operate. Several companies have their foundations as the social
arm of the company to undertake their Corporate Social Responsibility (CSR)
activities and programmes.2
Corporate Foundation is a charitable foundation which serves as a channel for
distribution of a firm’s profits into non-profit activities.3
A corporate foundation is a private foundation that gets its funds from a company
or corporation. It is independently created for the purpose of making grants.
Corporate foundations:
frequently assume responsibility for the company’s philanthropic giving
typically start with a single gift endowment that the company can add to as
it wishes
are often governed by company owners or key executives
are subject to the same tax regulations as private foundations.
Corporate foundations are distinct from “corporate giving programmes” that are
administered within a corporation. Corporate giving programmes make grants
for limited purposes closely associated with the interests of the company.4
The term “corporate foundation” is used to refer to either a private foundation
controlled by a corporation, or a public charity associated with a corporation.
Most corporate foundations are of the private foundation type. This is because
they are created by a single corporation, funded by that corporation’s money,
and controlled by that corporation’s employees or directors. 5
Corporate foundations “are philanthropic organizations that are created and
financially supported by a corporation. The foundation is created as a separate
legal entity from the corporation, but with close ties to the corporation” (Council
of Foundation, n.d.).6
A Company Foundation is a legally registered not-for-profit organization/
society/ company/ trust established and promoted by the company/business
for implementing its CSR commitments, and can be said to fulfill the following
criteria7:
1) The majority of its funding is from the Company
2) It is a foundation based in India (Head office in India)
3) The foundation’s governance body comprises company staff and
management
4) The website and annual report of the company mentions the foundation as
the primary vehicle through which it undertakes its CSR activities.
— Prakruthi, 2015 167
Stakeholders’ Engagement A foundation is a non governmental entity that is established as a nonprofit
corporation or a charitable trust, with the principal purpose of making grants to
unrelated organizations, institutions, or individuals for scientific, educational,
cultural, religious, or other charitable purposes. This broad definition encompasses
two foundation types: private foundations and grant making public charities. 8
A private foundation derives its money from a family, an individual, or a
corporation. An example of a private foundation is the Ford Foundation. Private
foundations must meet a “payout requirement,” meaning they have to give away
a certain amount of their assets every year. 8
In contrast, a grant making public charity (sometimes referred to as a public
foundation) derives its support from diverse sources, which could include
foundations, individuals, and government agencies8. An example of a grant
making public charity is the Akshaya Patra Foundation in which an individual
or organization can be involved by donating their money or other efforts for its
work.
4.3 ROLE OF CORPORATE FOUNDATIONS IN

CORPORATE PHILANTHROPY
Corporate Philanthropy refers to the investments and activities a company
voluntarily undertakes to responsibly manage and account for its impact on
society. It includes investments of money, donations of products, in-kind services
and technical assistance, employee volunteerism, and other business transactions
to advance a social cause, issue, or the work of a nonprofit organization. Corporate
philanthropy has an opportunity to redefine the purpose and value for corporate
foundations and giving programmes. 9
Here are some reasons why an organization should consider starting a corporate
foundation for its own:
1) Corporate Foundations Increase Visibility
Consumers and corporate shareholders expect that companies will engage in
charitable giving as part of the community responsibility that comes with doing
business. A corporate foundation is a highly visible way to segment these activities
and demonstrate that it is important to a company. By supporting valuable social
causes like sponsorships, scholarships, etc., the visibility of a corporate foundation
becomes stronger.10
Example: The concept and practice of sustainability is at the core of all Tata
Chemicals’ activities, including its corporate social responsibility initiatives.
Tata Chemicals Society for Rural Development (TCSRD), set up Okhai in
order to empower the rural and semi-urban women by promoting traditional
handicrafts which are on the verge of dying due increased urbanization. This
community intervention that is helping to change the lives of hundreds of
people that live around Tata Chemicals factories across the globe. (For more
details visit http://indiacsr.in/the-success-of-okhai-when-colors-and-
imagination-take-flight/)
2) Corporate Foundations Integrate Philanthropy with CSR

Corporate foundations ensure that companies are proactively participating in
philanthropic activities such as donations and volunteerism. Corporate
168
foundations often get involved in promoting important topics such as Corporate Foundations
sustainability, economic development, corporate ethics, minimizing operational
harm, and being a good corporate citizen. 10
Example: Indus Action works on ensuring proper implementation of 12(1)(c)
of the Right to Education Act (RTE) which mandates each private school to
ensure 25% of seats in KG and Class 1 are reserved for economically weaker
sections (EWS) families. They act as a bridge between government, private
schools and the community. It has helped more than 60,000 children gain
admission in private schools for academic year 2018-19 and is targeting to
help enroll around 2.50 lakh children in the subsequent year.
3) Corporate Foundations’ Boards Provide Overseeing
A corporate foundation provides a formal structure for managing corporate giving,
and the foundation’s board of directors provides important overseeing to make
sure goals are being met. The foundation board sets policies for funding and
administration ensures compliance with government requirements, oversees the
approval of major grants, and ensures that staff is executing the foundation’s
work properly.10
Example: Khushi Anganwadi Programme project by HZL is a unique tri-
partite Public–Private–People initiative reaching out to 3089 Anganwadis
(early childhood care centres) in selected blocks of Ajmer, Bhilwara,
Chittorgarh, Rajsamand and Udaipur districts. The goal is to strengthen the
efficacy of Government’s Integrated Child Development Services (ICDS)
Scheme to improve health and well-being of children in the 0 to 6 years age
group. The programme touches the lives of 64,000 children directly. The
project is being implemented in partnership with reputed NGOs like Gramin
Avam Samajik Vikas Sanstha (Ajmer), CARE India (Bhilwara &
Chittorgarh), Jatan Sansthan (Rajsamand) and Seva Mandir (Udaipur). (For
more details visit http://www.hzlindia.com/csr/csr-programs/education/
khushi-anganwadi-program/)
4) Corporate Foundations Help Avoid Conflicts of Interest
The Council on Foundations indicates that one of the biggest legal challenges
encountered by corporations with charitable foundations is avoiding conflicts of
interest. Under the law, a private foundation is prohibited from entering into any
financial transactions with the parent company as well as any major donors,
officers, executives, or subsidiaries. The structured nature of a corporate
foundation can help ensure that philanthropic activities are compliant with all
legal and ethical guidelines. 10
Example: The Global Compact Network India works towards mainstreaming
the ten universally acceptable principles in business activities around the
world, catalyzing action in support of broader goals, such as the Millennium
Development Goals (MDGs) and setting the tone for the post 2015
development agenda within the Indian context. The main objective of GCNI
is to provide a forum to various Indian companies and organizations for co -
partnerships, build strong network and promote sustainable and positive
corporate citizenship by encouraging various Indian corporate bodies/
institutions/ NGOs/ SMEs, to become members of the network, all these
together aid in dissemination and promotion of global compact principles
within their own milieu.12 (For more details visit https://www.globalcompact.
in/about)
169
Stakeholders’ Engagement 5) Corporate Foundations Go Beyond Cash and Products
While direct cash grants and product donations are a core focus for corporate
foundations, there are other areas where foundations often get involved. This
can include promoting matching gifts, grants to organizations where employees
volunteer, loaning equipment or facilities to non-profits, and encouraging
employees to volunteer at charities or serve on non-profit boards. 10
Example: Through the Olympic Gold Quest, Parle Products Pvt Ltd. supports
Indian sportspersons who have the potential to win medals at the Olympics.
In a bid to build an international reputation for athletes, it works to bring
about a positive change in the perception of sports in the country. (For more
details visit http://www.parleproducts.com/csr)
4.4 TYPES OF NON PROFIT ORGANIZATIONS

Various types of not-for-profit organizations11,12
In India, not-for-profit organizations generally take three forms: Trusts, societies
and private corporate foundations (section 8).
1) Trusts: Trust is a legal entity, formed by one party, in which assets are
entrusted to the second party by the first party, for the benefit of the third
party. Here, the first party implies the Trustor; the second party is called the
Trustee. The subject matter of the trust is known as Trust Property, and the
document detailing the terms and conditions is called Trust Deed. Trusts
are governed by the Indian Trusts Act, 1882.
Public charitable trusts may be established for general purposes, including

poverty relief, providing education, medical assistance, the provision of
facilities for recreation, and any other objective of general public utility.
Indian public trusts are generally permanent. No national law governs public
charitable trusts in India, although many states (particularly Maharashtra,
Gujarat, Rajasthan, and Madhya Pradesh) have their own Public Trusts
Acts. e.g., Adharshila Trust New Delhi, whose mission is to build
foundations at the grassroots level with dedication and sincerity.
2) Societies: these are a collection of persons working together for charitable

purposes that may be registered. They are usually managed by a governing
council or a managing committee and are regulated by the Societies
Registration Act, 1860, which has been adopted by various states. Societies
may be dissolved but it is not possible for Trusts. An incorporated society
must meet the minimum requirement set out in the Incorporated Societies
Act 1908. For example, Make a Difference (MAD) is a registered society
under the Travancore Cochin Literary, Scientific and Charitable Societies
Registration Act, 1955.
3) Section 8 Companies: Under Section 8 of the Indian Companies Act, the

Central Government may issue a license to a limited or private limited
company which:
Has as its purpose the promotion of commerce, art, science, sports,

education, research, social welfare, religion, charity, protection of
environment, or any such other object;
170
Intends to apply its profits, if any, or other income towards promoting Corporate Foundations
its purposes; and
Intends to prohibit the payment of any dividend to its members.
Example: Adani Foundation. Company Profile: Adani Foundation was started
by Adani Group of companies in 1996. It contributes to education, community
health, sustainable livelihoods development and rural infrastructure development
programmes.
Table 4.1: Difference between Society, Trusts and Section 8 Companies
Basis Section 8 Companies Society Trust
What it is? A non profit enterprise A group of persons An agreement

associated with a come together between
commercial business for the initiating parties,
enterprise, and set up any literary, whereby one
to attain goals similar scientific or party holds an
to a trust or society. charitable purpose. asset for the
benefit of
another party
Governing Act Companies Act, 2013 Indian Societies Indian Trusts

Act, 1860 Act, 1882
Time taken to 3-6 months 1-2 months 2-7 days

incorporate
Minimum 2 7 2
number of
members
Family members No No Yes
can be members
Root Documents MOA, Rules & MOA, Rules & The Trust
Regulations Regulations Deed
Board members committee, trustees, committee, trustees, Trustees

council, directors, council, directors,
governors, etc. governors, etc.
Voting Rights Based on shares Equal rights Equal rights
Filing of Annual Yes Yes No

returns
Ease of Easy Complex Less complex

incorporation +
compliance
Ease of allotting Yes No No
Share
(Source: http://www.wazzeer.com, https://www.schoolserv.in/Trust-vs-Society-vs-Section-
Company-Which-suits-best-to-school-starters/)
171
4.5 ESTABLISHING A TRUST
Establishing A Trust 20, 21: In this section you will read about the different
aspects of a Trust.
4.5.1 What is a Trust?

A trust is transfer of property by the owner (trustor/donor/settler) to another
person (trustee) on whom the owner has confidence for the benefit of a third
person (beneficiary). Here property means real estate, cash, shares, or any other
valuable assets. The ‘trust deed’ is known as trust instrument by which the entire
trust is declared.
4.5.2 Objectives of a Trust

The trust should be created for a lawful purpose. As per Section 4 of the Indian
Trust Act, 1882, all purposes are said to be lawful unless it:
1) Is forbidden by law
2) Defeats the provisions of law
3) Is fraudulent
4) Involves injury to another person or his property
5) Immoral or against to public policy
4.5.3 Types of trusts:

Private Trusts (beneficiary is identified and specific person(s), and
Public Trust (beneficiary is general public) also known as charitable trusts
4.5.4 Documents required for registering a Public Charitable

Trusts
A complete drafted trust deed: mentioning name, registered office, areas of
operation, objectives, details of trustor, assets of trust, detail of board of
trust along with their qualifications terms and tenure, power and functions
of trustees etc.
Proof of registered office or rental agreement with landlord,
ID proof (PAN and Aadhar) of founder, and
Two witnesses
4.5.5 Advantages and Limitations in Trusts

Advantages:
Assets protection: Assets can be protected through Trust because an asset
transferred to an incorporated trust no longer forms a part of the trustor and
therefore cannot be snatched if a settler gets into financial difficulties.
Estate planning: A trust is the most satisfactory way of arranging the estate
for providing a source of income in case of uncertainty.
172
Tax planning: When assets are transferred to trust thereafter, they are no Corporate Foundations
longer considered as property of trustor.
A trust will enable the trustee to avoid forceful heir-ship to their next
generation after their death.
Protection of weak or disabled section of society is usually provided through

trusts.
Limitations:
Irrevocability: There is no control of trustor over the assets as soon as those
are put into trust and their costs.
Activity 1
Visit one trust or society which is active in your vicinity and list the activities
undertaken by it in the past one year.
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4.6 ESTABLISHING A SOCIETY

Establishing a Society 18,19: In this section we will learn about different aspects
of establishing a Society.
4.6.1 The Societies Registration Act, 1860

A society can be formed by minimum seven or more persons.
Not only Indian individuals but companies, foreigners also can register for
the Memorandum of Society.
Society can also be registered or unregistered.
State Governments maintain the society registration.
To register a society, the establishing members must agree to its name and
then prepare the memorandum, along with rules and regulations to be
followed by members.
4.6.2 Checklist required for registering a society in India

PAN Card of all the members of the proposed society
Memorandum of Association explaining the objectives of society, details
about all the members, and address of the registered office of the society.
Articles of the Association containing the information about rules and
regulations of working of the proposed society, details about the meetings
and its frequency, about auditors, forms of arbitration in dispute situation,
and ways of dissolution. 173
Stakeholders’ Engagement Covering letter mentioning the purpose of society, duly signed by all the
concerned persons.
Proof of address of registered office of the proposed society.
A list of all the members along with their signatures.
A declaration by the president of proposed society expressing the willingness
and ability to hold post.
Required fees and all the above mentioned documents (in 2 sets) are entailed
to submit to the Registrar of Societies. If these are found satisfactory, then
registration number and incorporation certificate is issued.
4.6.3 Advantages and Limitations in Society

Advantages:
Incorporation makes a society a separate legal entity.
After incorporation, society gets right to sell, buy, lease, rent, borrow money,
and enter into any contract by its name.
There is no personal liability of the members of the society for any debts,
contract or obligations of the society unless these are incurred through
unlawful activities or for profit gain.
An incorporated society is entitled to income tax exemption.
Limitations:
Societies are seen as less attractive to commercial investors due to lack of
professionalism and managerial practices.
1) What is a corporate foundation?
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2) What are the advantages of a society?

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174 .......................................................................................................................
4.7 ESTABLISHING SECTION 8 COMPANIES
How to Establish Section 8 Companies 13, 14,15
Section 8 companies are most preferred NGO type among all three discussed
earlier because it provides certain exemptions in terms of tax.
4.7.1 What is a Section 8 Company?

A Section 8 Company is any company which is governed under section 8 of the
companies act, 2013 and having the objective of promoting commerce, art,
science, sports, education, research, social welfare, religion, charity, protection
of environment, or any such other aim. As these companies are fully involved in
charitable work, so they can also avail tax benefits.
4.7.2 Objectives of Section 8 Company:

To work towards the well-being of society in the domains of science, art,
sports, education, research, social welfare, environment protection etc.
To promote all the above mentioned fields along with a concern for public
interest.
4.7.3 Features of incorporating a Section 8 Company in India

There are numerous features which differentiate Section 8 Companies from others.
Those features are:
a) Section 8 companies cannot be treated as a small company.
“A Company to be a small company (other than a public company) must
satisfy both the following conditions:
1) paid-up share capital does not exceed fifty lakh rupees and
2) turnover as per profit and loss account for the immediately preceding
financial year does not exceed two crore rupees”
b) Profit or dividend is not shared by shareholders of the company.
c) The company’s profit is used to attain its objectives.
d) As per Section 8 (2) of the Companies Act, 2013, such companies can have
the benefit of all other limited companies.
e) The Central Government provides a special license to Section 8 companies

and governs them.
f) Such companies need not to use the suffix ‘Pvt. Ltd.’ or ‘Ltd.’ with its
name.
g) The application for company registration must be made to the Registrar of

Companies (ROC). The Central Government delegates the controlling power
to ROC.
175
Stakeholders’ Engagement 4.7.4 Documents required for incorporating Section 8 Company
Following documents are required to register a company as Section 8:
PAN (Permanent Account Number) card copy of all the members (Directors
and shareholders) for proof of identity;
One copy of any proof of address of all the members (Driving License/
Aadhar Card/ Passport/ Voter ID card);
Latest passport size photographs of abovementioned people;
Recent utility bills of the registered office;
If the registered office is on rent, then its rent agreement;
Filled form of DIR-2, which is actually consent of person to act as a director;
NOC (No Objection Certificate) from the landlord of the proposed registered
office;
Additional information about the directorship of the directors in any other
companies, if any.
4.7.5 Section 8 Company registration procedure

To register a company under Section 8, the following six steps procedure is
illustrated:
Fig 5.1 Registration Process for section 8 Company
Step 6: File SPICe Form

INC-32 with the ROC
Step 5: Issuance of
License
Step 4: File Form INC-12

with the ROC
Step 3: File INC-1 for

Company Name Approval
Step:2 DIN from ROC
Step 1: Obtain DSC

and file Form DIR-3
(Source: https://swaritadvisors.com/learning/all-you-need-to-know-about-section-8-company-
176 in-india/)
Step 1: Obtain (Digital Signature Certificate) DSC and file Form DIR-3 Corporate Foundations
This process starts with obtaining a DSC (Digital Signature Certificate)

of the proposed directors of the company. Thereafter, the next task is to
file Form DIR-3 to the Registrar of Companies, as a request for issuing
DIN (Director Identity Number). This requires attaching Identity proof
and address proof documents discussed earlier.
Step 2: DIN from ROC

If the ROC confirms the validity and reliability of the form, it will
approve and give the DIN to the planned directors.
Step 3: File INC-1 for Company Name Approval

Next requirement in the process is to file form INC-1 for getting name
approval of the company. This is also made with the ROC. Here, it is
suggested to propose two names in the order of choice. Finally, the
ROC will allot only one of the names out of two proposed after checking
the availability of the same.
Step 4: File Form INC-12 with the ROC

Once the company’s name approval is obtained, the next task is to file
Form INC-12 to the ROC. Following documents are attached with INC-
12:
Form INC-13, Memorandum of Association (MOA);
Articles of Association (AOA);
Form INC-14, Declaration from the Practicing Chartered Accountant;
Form INC-15, Declaration from every person who fills the
application;
Assessed expenditure and income for the next three years.
The signature of every subscriber should be mentioned on the
subscription pages of the MOA and AOA of the company. Furthermore,
it must also have their name, address, and occupation.
Step 5: Issuance of License

The ROC will examine and confirm the forms. If they are satisfied then
they will approve it. As well, the ROC will issue the license under
Section 8 in Form INC-16.
Step 6: File SPICe (Simplified Pro Forma for Incorporating a Company

Electronically) Form i.e., INC-32 with the ROC
After receiving the license, the next requirement is filing SPICe i.e.,
INC-32 with the Registrar of Companies for company incorporation.
Following documents are attached with it:
INC-9, an affidavit from every director and subscriber;
KYC of every director;
Declaration regarding the deposits;
Consent letter of every director;
177
Stakeholders’ Engagement Form DIR-2 with an identity proof and address proof of the directors;
Utility bills as an address proof of office which must not be older than
two months;
NOC in case the office premise is on rent or lease;
Interest in other entities of all directors;
Draft MOA and AOA.
If the form is found to fulfill every criterion, then the ROC issues a COI
(Certification of Incorporation) along with a unique CIN (Corporate
Identity Number).
4.7.6 Business benefits from Section 8 Companies16

There are a number of benefits to a company in the formation of its own charitable
foundation:
Participation: With a company charitable foundation, a company’s staff
can be involved in its management and administration. This allows for staff
to be fully engaged in the projects and the charitable giving.
Example: Along with contributions by ACC Trust at flood relief and
rehabilitation in Kerala in the year 2018, ACC employees immediately
donated one day’s salary to the humanitarian effort. (For more details visit
http://indiacsr.in/corporate-social-responsibility-acc-forefront-flood-relief-
rehabilitation-kerala/)
Reputation: The formation and funding of a charitable foundation can be
used in the company’s CSR material. The causes supported by the charitable
foundation can be monitored to ensure that these are appropriate and will
not cause reputational harm to the company rather enhance the image, brand
and good sense of belongingness amongst the beneficiaries.
Example: The Piramal Foundation is committed to improving primary
healthcare and nutrition through Piramal Swasthya, universal primary
education through Piramal Foundation for Education Leadership and
enabling access to safe drinking water through Piramal Sarvajal. ‘Doing
Well and Doing Good’ is the core corporate philosophy of Piramal Group.
(For more details visit http://www.piramal.com/foundation)
Endowment: The timing of direct giving can be difficult as causes may
not be readily identifiable; also, profits can fluctuate. A company charitable
foundation can hold, invest and accumulate funds while projects are being
identified. With retained funds, the foundation will be able to support
projects as and when need arises.
Example: Rapid Response is an award-winning organization which serves
the country for disaster response and preparedness. As a disaster relief
agency, it helps people to survive and rebuild their lives through food,
medical, education, shelter and livelihood programmes. (For more details
visit https://www.rapidresponse.org.in/)
Sustainability: A charitable foundation can accumulate reserves. This can
allow a company to continue its charitable giving strategy even in years in
which profits are lower than usual.
178
Eample: Sharda Foundation is a social enterprise that enable sustainable Corporate Foundations
livelihood for disadvantaged people in urban and rural areas. Its three point
philosophy integrates social and business impact by bridging the gaps in
education, employment and entrepreneurship. (For more detail visit http://
www.shardafoundation.org/)
Tax relief: A corporate foundation may have tax benefits indirectly.

Corporations can keep their giving relatively constant by funding the
foundation in good years, and by spending down the accumulated fund in
less good years.
Other softer benefits are:

Organization philosophy which sets tone of being a great place to work.
Deep sense of gratitude amongst all stakeholders, management, and
employees equally.
Employee branding and belongingness
Employee engagement and loyalty, for example, Tata where no employee
leaves the job easily.
Tax Exemption
Enhanced Exempted from

Credibility paying Stamp
Duty
Advantages of
Section 8
No need for a Company
title ex. Pvt. Separate Legal
Ltd., Ltd., etc Entity
Easy Transfer No minimum

of Ownership/ Capital required
Title
Fig 5.2 Advantages of Section 8 Company
(Source: https://www.taracorporate.com/section-8-company-registration)
4.7.7 Disadvantages of registering a company as Section 8 17

Profit or any other income of the company is applied for the promotion of
the main objective only.
179
Stakeholders’ Engagement Declaration of dividend or distribution of profit to the members is not
allowed
No member can be appointed as a remunerated officer of the company
No remuneration / benefit shall be paid to a member being a servant / officer
of the company (except reimbursement of out of pocket expenses, reasonable
interest on money lent or reasonable rent on the premises)
4.8 SUCCESS STORIES OF CORPORATE

FOUNDATIONS IN CSR
1) K. C. Mahindra Education Trust (Project Nanhi Kali)
Project Nanhi Kali was initiated in 1996 by the K. C. Mahindra Education Trust
(KCMET) with the aim of providing primary education to underprivileged girl
children in India. Anand Mahindra, the current chairman of Mahindra & Mahindra
Ltd., founded Project Nanhi Kali with a strong belief that educated women would
not only contribute to the economy but also issues of population and social evils
like the dowry system and child marriage would reduce as more women are
educated.
Project Nanhi Kali was designed as a sponsorship support programme which

allows individuals to participate and support the education of a girl child in India.
Since 2005, Project Nanhi Kali is jointly managed by the K. C. Mahindra
Education Trust and Naandi Foundation. The project provides academic, material
and social supports that allows a girl child to access quality education, attend
school with dignity and reduces the chances of her dropping out.
Project Nanhi Kali has consistently communicated that education is the only
tool which enables girls to rise from a life of poverty and go on to live a life of
dignity. Its campaign #LadkiHaathSeNikalJaayegi, referred to the patriarchal
attitudes towards girls which discouraged them from getting educated, but gave
a positive spin to the phrase, by linking their education to achieving their
aspirations, to become self-reliant and independent women. Project Nanhi Kali,
since 1996 has empowered over 350,000 girls till date, including 153,999 girls
in this past year alone. For more detail visit: https://www.nanhikali.org/ and http:/
/indiacsr.in/mahindra-groups-ladki-haath-se-nikal-jaayegi-in-an-all-new-avatar/
2) Oil and Natural Gas Corporation (ONGC)

The journey of Swachhta in ONGC started with the clarion call from Hon’ble
Prime Minister of India for Swachh Bharat Abhiyan from Rajghat on 2nd Oct
2014. In the last three years, ONGC has taken all efforts to make the Swachh
Bharat Mission of Hon’ble Prime Minister a success. From the high altitude
mountains of the Himalayas to the Holy city of Varanasi, ONGC swachh footprints
can be experienced all across the country.
At ONGC, swachhta is no more a directive but has become a habit for the
employees, driven both externally and internally. Besides, undertaking regular
swachh activities like construction of toilets and cleaning initiatives, ONGC has
undertaken some unique swachhta projects, which receives special appreciation
from its stakeholders.
180
Few of such projects are: Corporate Foundations
Cleaning and beautification of ancient kunds of Varanasi

Restoration of 15th century step well
Cleaning expedition in the high altitudes mountains of The Himalaya
Rejuvenation and beautification of Tikona park near Jantar Mantar
Provision of clean drinking water through Water ATM at Varanasi and mobile
Water ATM at Lucknow
Green Rameshwaram Initiative
Information, Education, Communication (IEC) programme in 5592 schools,
where ONGC has constructed 7958 toilets under Swachh Vidyalaya Abhiyan
to address the behavioral changes in school children.
Swachh Vidyalaya Abhiyan
Open Defecation Free Initiative
Paperless Office initiative
(For more detail visit https https://www.ongcindia.com/wps/wcm/connect/
83fbfbb9-ad90-4652-a286)
Activity 2
Read about five corporates undertaking CSR activities and write down how
each one is engaging in implementation of CSR activities (through trusts,
societies or Section 8 Companies).
.......................................................................................................................
.......................................................................................................................
.......................................................................................................................
.......................................................................................................................
1) What is a Section 8 Company?
.......................................................................................................................
.......................................................................................................................
.......................................................................................................................
.......................................................................................................................
.......................................................................................................................
2) What are the business benefits of a Section 8 Company?

.......................................................................................................................
.......................................................................................................................
.......................................................................................................................
....................................................................................................................... 181
4.9 LET US SUM UP
Corporate foundations are a good way to organize and manage philanthropic
activities for business giants who participate actively in such activities. The role
of foundations in corporate philanthropy is constantly evolving. A corporate
foundation increases visibility of the corporate brand by creating its distinct image
in the mind of community. In this unit you have read about the three different
non profit organizations through which the corporates implement their CSR
activities. They are the Trusts, Societies and Section 8 Companies. A Trust is a
legal entity, formed by one party, in which assets are entrusted to the second
party by the first party, for the benefit of the third party and is governed by the
Indian Trusts Act, 1882. Societies on the other hand are a collection of persons
working together for charitable purposes that may be registered and are regulated
by the Societies Registration Act, 1860. Section 8 companies are most preferred
NGO type among all three because it provides certain exemptions in terms of
tax. In this unit you have read about the establishment of all three types of
organizations, their advantages and limitations. The unit also has ample case
studies for each of the organizations.
4.10 KEYWORDS
Corporate Foundations: A corporate foundation is a type of foundation. This
means that it is a non-profit organisation, different from the company. It is part
of the private foundation family. The characteristic of this one is that the majority
of the funds are coming from one source. The corporate foundation’s source is:
an enterprise and its employees.
Trust: A trust is a three-party fiduciary relationship in which the first party, the
trustor or settlor, transfers a property upon the second party for the benefit of the
third party, the beneficiary.
Society: Society is a group of persons who are associated together for a common
purpose. The purpose may be related to promoting any literary, charitable or
scientific work.
Section 8 Company: A company is referred to as Section 8 Company when it

registered as a Non-Profit Organization (NPO) i.e. when it has motive of
promoting arts, commerce, education, charity, protection of environment, sports,
science, research, social welfare, religion and intends to use its profits (if any) or
other income for promoting these objectives.

1) https://www.bizcentralusa.com/benefits-establishing-corporate-foundation/
2) Mukherjee A. S., Poduwal S. and Mehta V.M. (2015). Study on Corporate

Foundation: An Emerging Development Paradigm. Prakruthi Publication,
Bangalore
3) http://www.businessdictionary.com/definition/corporate-foundation.html
4) http://www.centerforgiving.org/Portals/0/Definitions%20of%20
Membership%20Categories.pdf
182
5) http://www.valorcsr.com/blog/what-is-a-corporate-foundation Corporate Foundations
6) Council of Foundations (n. d). What are some different kinds of private
foundations? http://www.cof.org/content/foundation-basics
7) https://cafindia.org/images/FINAL_Report_CF_study.pdf
8) https://grantspace.org/resources/knowledge-base/what-is-a-foundation/
9) https://www.cof.org/program-initiative/leading-corporate-philanthropy
10) https://www.frontstream.com/the-evolving-role-of-foundations-in-
corporate-philanthropy/
11) https://www.cof.org/content/nonprofit-law-india#_ftn1
12) https://ngosindia.com/
13) https://swaritadvisors.com/learning/all-you-need-to-know-about-section-8-
company-in-india/
14) https://www.legalraasta.com/blog/need-know-section-8-company/
15) https://swaritadvisors.com/section-8-company-registration
16) https://www.withersworldwide.com/en-gb/insight/corporate-giving-the-
benefits-of-a-company-charitable-foundation
17) http://www.pansofin.com/blog/section-8-company-advantages-
disadvantages-registration-process/
18) https://cleartax.in/s/society-registration-india
19) https://www.ngoindia.com/ngo-registration/society-registration/
20) https://taxguru.in/income-tax/register-public-trust-india.html
21) https://www.sovereigngroup.com/our-services/private-clients/sovereign-
trust-and-trustee-services/uses-of-trusts/

ANSWERS
Answer 1. A Corporate Foundation is a charitable foundation which serves as
a channel for distribution of a firm’s profits into non-profit activities.3
A corporate foundation is a private foundation that gets its funds from a
company or corporation. It is independently created for the purpose of
making grants.
Answer 2. The advantages of a society are:
Incorporation makes a society separate legal entity.
After incorporation, a society gets the right to sell, buy, lease, rent,
borrow money, and enter into any contract by its name.
There is no personal liability of the members of the society for any
debts, contract or obligations of the society unless these are incurred
through unlawful activities or for profit gain.
An incorporated society is entitled to income tax exemption. 183
Stakeholders’ Engagement Check Your Progress -2
Answer 1. Section 8 Company is any company which is governed under section
8 of the companies act, 2013 and having the objective of promoting
commerce, art, science, sports, education, research, social welfare, religion,
charity, protection of environment, or any such other aim. As these
companies are fully involved in charitable work, so they can also avail tax
benefits.
Answer 2. The business benefits of Section 8 Companies are
Participation: With a company charitable foundation, a company’s staff

can be involved in its management and administration. This allows for
staff to be fully engaged in the projects and the charitable giving.
Reputation: The formation and funding of a charitable foundation can

be used in the company’s CSR material. The causes supported by the
charitable foundation can be monitored to ensure that these are
appropriate and will not cause reputational harm to the company rather
enhance the image amongst the beneficiaries.
Endowment: A company charitable foundation can hold, invest and

accumulate funds while projects are being identified. With retained
funds, the foundation will be able to support projects as and when need
arises.
Sustainability: A charitable foundation can accumulate reserves. This

can allow a company to continue its charitable giving strategy even in
years in which profits are lower than usual.
Tax relief: A corporate foundation may have tax benefits indirectly.

Corporations can keep their giving relatively constant by funding the
foundation in good years, and by spending down the accumulated fund
in less good years.
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UNIT 5 LOCAL BODIES
Structure
5.1 Introduction
5.2 Concept of Local Government.
5.3 What are Local Bodies?
5.4 Functions of Local Bodies in India
5.5 Implementation of CSR by local bodies
5.6 Challenges
5.7 Let Us Sum Up
5.8 Keywords
5.1 INTRODUCTION
Local government can play a substantial role in fostering CSR activities in their
regions and states. Corporate responsibility is a means of setting up a collaborative
approach between corporations, civil societies and government to provide
solutions to some major problems like poverty, social inequality and
unemployment.
India’s tradition of paternalistic philanthropy dates back to several years. The

process, though commended in recent times, has been in practice since ancient
times. Philosophers such as Kautilya have discussed the idea of following ethical
principles while carrying out business activities. The idea of helping the poor
and needy has been mentioned in early literature. Before industrialization, CSR
was mainly driven by religion and charity. The industrial groups of the 19th
century were driven towards charity for the social causes and personal savings
were mainly used for this purpose. During this period, the industrial families
also established temples, schools, higher education institutions and other
infrastructure of public use as charitable deeds.
In India, there is a growing understanding that businesses cannot function in

isolation and social upliftment is essential for sustainable growth. An ideal CSR
practice has both ethical and philosophical dimensions, particularly in India where
there exists a wide gap between sections of people in terms of income and
standards as well socio-economic status (Bajpai, 2001). This explains the
importance of local bodies in implementing CSR and allied activities.
After reading this unit, you will be able to:
Explain the meaning of local body and its functions.
Describe the various local bodies functioning in rural and urban areas.
Explore the role of local bodies in implementing CSR practices.
185
5.2 CONCEPT OF LOCAL GOVERNMENT
In this section, you will learn about the meaning, composition and functions of
local government. The local government plays a very important role in bringing
at the forefront issues of importance from local or regional perspective. In other
words, we can say that local government is a public organization authorized to
devise and administer limited range of public policies with a relatively small
territory which is a sub-division of regional or central government. Local
government at the rural and urban level is the best means to provide efficient
local governance. It manages the local affairs through elected councils. In rural
areas, local government helps in looking after the issues of common interest
among the village people. In the absence of local government in the rural area, it
is very difficult to address the unique local problems faced by the people.
Local governments of towns and cities or village and district governments have
no sovereign powers of their own. They rather occupy the unfortunate position
of second level importance and also do not enjoy much freedom in the exercise
of their powers. However, the presence of local governments in the context of
finance has importance from a democratic point of value. Thus, local government
is the machinery constituted by the people in an area to administer the affairs of
a locality. It deals with matters concerning the inhabitants of a particular limited
area. The area whether big or small has the legal right. The local government at
the place can act independently and with little of external control can administer
the routine affairs of the place very efficiently. But the freedom of action of the
local authority is limited. The local governments are designed by the state
government and they live and grow as directed by state authorities. People have
an opportunity to choose their representatives to take care of their own local
needs in a local government. Local governments cater to local needs like water
supply, street lights, drainage, education and public health.
5.2.1 Functions of Local Government

In general, local governments comprising of rural/urban local bodies perform
two kinds of functions:
1) Obligatory functions: Obligatory functions are mandatory functions

performed by the local governments. These include ensuring safe and
continuous water supply, providing electricity, cleaning of streets and
colonies and construction and maintenance of civic amenities like roads,
drains, etc.
2) Discretionary Functions: Discretionary functions are not compulsory

functions of the local government. These include establishment of and
maintenance of libraries and reading rooms, construction and maintenance
of community gardens, cycling track, etc. The CSR functions of the local
government are generally the discretionary functions and are performed
mainly on the basis of available funds.
5.2.2 Forms of local government

The local governments function both at the rural and urban areas in the name of
rural local body and urban local body respectively. The urban bodies identified
186
as municipal bodies are known as corporations in cities and municipalities in Local Bodies
towns. The rural local bodies are named as Panchayat Raj institutions. At the
village level the local bodies are known as village panchayats. At the block level
they are called panchayat samitis. At the district level they are known as zilla
parishads. It is important to know that the existence of municipal government in
India since the Vedic times has been confirmed by the archaeological excavations.
In the coming sections, we will study more about the local bodies and their
various functions in rural and urban areas.
5.3 WHAT ARE LOCAL BODIES?

Local bodies represent governance at the local level. These bodies look after the
administration of villages, towns, or cities. The Local bodies in India are divided
into two types: rural Local Bodies and urban local bodies. The local bodies which
are formed for planning, development and administration at the local level in the
rural areas are known as rural local bodies (panchayats) and the local bodies,
which are meant for planning, development and administration in the urban areas,
are known as urban local bodies (municipalities).
The constitution of local bodies is the most revolutionary step in the history of
governance in India. It has empowered the communities to address their problems.
The decentralization of powers at the village level in rural areas removes the
pitfalls of governance and it also includes the involvement of all communities
irrespective of their caste, religion or any other barrier.
5.3.1 Rural Local Bodies

The idea of Panchayati Raj was put forward by Mahatma Gandhi. His idea of
‘Gram Swaraj’ meant that each village through decentralization must be able to
manage its own affairs. Following this idea, in 1950s and 60s, panchayats were
established in different states. After this, the community development programmes
were started by the government. In 1993, constitutional powers were vested in
them and the panchayats became independent. This is well established that
panchayats offer proper service delivery in villages, be it, telecom, sanitation,
drinking water supply, rural energy or other rural infrastructure. They receive
financial aid and technical support from the government to carry out the official
programmes.
5.3.2 Urban Local Bodies

To look after the affairs of the urban areas, the urban local bodies were created.
After the Constitution’s 74th. Amendment, 1992, the urban local bodies were
given constitutional provisions which made them act independently and were
held responsible for their allocated functions. The municipal bodies are delegated
a large number of functions by the state government. As per the Census of India
(1991), there were 3255 urban local bodies (ULBs) in the country. The urban
local bodies in India comprise of the municipal corporation (nagar nigam),
municipality (nagar parishad) and town area committee.
187
5.4 FUNCTIONS OF LOCAL BODIES IN INDIA
The local bodies connect with the local community in a socially appropriate
manner to attend to local needs for the well being of the society. Rural areas
have irrigation, sanitation, education, poverty, as the main issues whereas in
urban areas, maintenance of urban areas, urban planning, traffic control, solid
waste management, etc. are the points of consideration. The local bodies serve
to provide solutions to the existing problems and strive for the well being of the
people. You must have seen various examples where the urban local bodies in
your city have taken steps for providing drinking water supply, or taking measures
for the control of vector borne diseases and so on.
5.4.1 Functions of the Rural Local Bodies

The chief functions of the rural local bodies are ensuring water supply for drinking
and irrigation purposes, sanitation and solid waste management, maintenance of
roads and provision of streetlights, maintenance of public places like gardens,
community halls, cremation grounds, etc. With the growing awareness regarding
pollution, the prevention of pollution by not dirtying common places, not burning
of fodder and not throwing anything in water bodies, etc., have also come under
the functions of local bodies.
Similarly, actions of solid waste management, street sweeping and cleaning, etc.,
are carried out rigorously by these local bodies. Along with the main activities,
there are ancillary activities which need to be performed in conjunction with the
main activities. These include subjects such as immunization, health awareness
movements and other activities. In case of road development, levy of taxes and
tolls and acquisition of land for roads comes under the ancillary function of local
bodies.
You can understand the main and ancillary functions by one more example. Like,
the provision of road lights is considered to be a main activity, the collection of
fees for street lights, promotion of rural electrification and promoting the use of
solar energy for street lightning is considered to be the ancillary activity.
Proper and efficient rural governance is at the heart of sustainability for any
village development programme. The role of panchayati raj institutions is to
connect citizens with the government, although the scope of good rural governance
is much broader. Simply setting up a local system of governance wouldn’t help
unless people are willing to bring about change and are themselves conscious of
their actions. The development of entrepreneurial skills of people is very important
in this regard. So in order to harness rural technology, the villagers must be well
versed in its use. You must read about the ‘Pani Panchayat’ story of Maharashtra
(given below in section 5.5.1) which has helped improve water supply in villages
by building water structures through villagers’ involvement. Likewise, community
led movements involving women play a great role in bringing about a change.
The concerns if not addressed are brought to the notice of the authorities and
appropriate action is taken to safeguard the interests of the villagers and
communities.
188
5.4.2 Functions of Urban Local Bodies Local Bodies
The 74th Constitutional Amendment Act, 1992 identifies 18 functions of urban

local bodies which are incorporated in Twelfth Schedule of the Constitution.
These are as follows:
1) Urban Planning including town planning;
2) Regulation of land use and construction of buildings;
3) Planning for economic and social development;
4) Roads and bridges;
5) Water supply for domestic, industrial and commercial purposes;
6) Public health, sanitation and solid waste management;
7) Fire services;
8) Urban forestry, protection of the environment and promotion of ecological
aspects;
9) Safe-guarding the interest of weaker sections of society, including the
handicapped and mentally retarded;
10) Slums improvement and upgrading;
11) Urban poverty alleviation;
12) Provision of urban amenities and facilities such as parks, gardens,
playgrounds;
13) Promotion of cultural, educational and aesthetic aspects;
14) Burials and burial grounds; cremations, cremation grounds and electric
crematoriums;
15) Cattle pounds; preventions of cruelty to animals;
16) Vital statistics, including registration of births and deaths;
17) Public amenities, including street lighting, parking lots, bus stops and public
conveniences; and
18) Regulations of slaughter houses and tanneries.
Urban local bodies play a crucial role in the planning and development of urban
areas. With the rapid growth in urbanization and population increase, the
municipalities in India are confronted with a number of challenges. The task is
effectively carried out by the ULBs, in respective urban areas. There are issues
such as upliftment of the weaker sections of society, eliminating poverty, providing
employment to all, providing quality life to the people, along with the development
related matters confronting the Smart Cities Mission, etc. On one hand, cities
have to address the challenges of unplanned urbanization and also have to be
prepared for the government’s vision of smart cities, on the other hand, cities
also have to equip themselves for addressing issues of environmental pollution,
waste generation, extreme weather events, and man induced disasters. The
infrastructure support will not help unless and until the personnel are trained and
competent enough. Along with this, the urban development planning and policies
must be interdisciplinary, cross sectoral and dynamic in nature. It is essential
that the urban local bodies (ULBs) are able to keep pace with this rising demand.
189
Activity 2
Visit the office of the functionaries of the nearest local body in your vicinity
and discuss with them about the local issues which they feel can be best dealt
with in collaboration with corporate as a part of their CSR activities. Note
down those local issues of interest.
.......................................................................................................................
.......................................................................................................................
.......................................................................................................................
.......................................................................................................................
.......................................................................................................................
Some of the functions of the Urban Local bodies are listed below:
1) Development Functions: All the types of construction like construction of

roads, buildings, bridges, flyovers, etc., will come under the category of
development functions. Urban local bodies are entrusted with the
responsibility of carrying out the land mapping of the area in order to ensure
proper land use planning and monitor the construction of buildings and
other infrastructure in the urban areas. Although, town planning and
construction come under the development authority, several times, the
responsibilities are shared. This becomes negative in the sense that
multiplicity of authorities makes monitoring and evaluation difficult and
there occurs lack of coordination. Similarly, taking measures for social and
economic development, opening of schools, gardens, and other places of
public interest are the development functions of the urban local bodies.
2) Public Health: The ULBs are responsible for taking measures for
maintaining the public health and prevent the outbreak of diseases by taking
corrective actions. During flood or drought or extreme weather events, the
supply of water gets interrupted and several disease outbreaks may take up.
The Urban Local Bodies also work for maintaining the proper hygiene and
sanitation standards to prevent the spread of communicable diseases.
Likewise, ensuring water supply not only for drinking purposes but also
for irrigation and industrial use is also the function of urban local bodies.
3) Welfare Functions: Urban local bodies must provide the community

services like playgrounds, community halls, markets, street lighting,
swimming pools, public conveniences, etc., for the welfare of the people.
4) Regulatory Functions: Enforcing bye laws, regulation of advertisement

and holdings, preventing illegal construction and encroachments on streets,
checking food adulteration, etc., are some of the regulatory functions of the
urban local bodies.
5) Public safety: Public safety is an important function of urban local bodies.

In cases of fire or accidents, the urban bodies must take timely and proper
actions to minimize the losses and must check the causes of these cases.
190
Apart from this, issues such as urban forestry, slum improvement, promotion of Local Bodies
culture, education and aesthetic aspects also come under the functions of urban
local bodies. With participatory planning, the communities can be involved by
which urban development can be delivered truly according to needs of the citizens.
With this, you can now imagine that the functions and responsibilities of the
local governments are of tremendous significance. These vary from state to state
and across cities within a state also.
1) What are urban local bodies? List some of the functions of urban local
bodies.
.......................................................................................................................
.......................................................................................................................
.......................................................................................................................
.......................................................................................................................
.......................................................................................................................
2) What are the welfare functions of the urban local bodies?

.......................................................................................................................
.......................................................................................................................
.......................................................................................................................
.......................................................................................................................
.......................................................................................................................
5.5 IMPLEMENTATION OF CSR BY LOCAL

BODIES
The local bodies are directly involved with the activities of rural and urban areas.
The local bodies have been taking measures in the direction of corporate social
responsibility. In several cases, it has been noticed that they assist the corporate
who are eager to lend their support for the well-being of the people. In the previous
section, you have studied about the functions of rural and urban local bodies. In
this section, you will learn about the importance of these local bodies in corporate
social responsibility.
5.5.1 Role of rural local bodies in promoting CSR

According to the 2011 census, 69 percent of India’s population lives in rural
areas, which is roughly equal to 833 million people. This percentage of the
population comprises of people who are poor, illiterate and devoid of the modern
ways of living. Rural areas are characterised by farms and open spaces. Therefore,
corporate social responsibility in rural areas seeks to address mainly infrastructure, 191
Stakeholders’ Engagement education, health and sanitation, vaccination, women empowerment, community
welfare, environment protection, etc. The local bodies are able to better monitor
and govern these issues. In view of this, the role of local bodies becomes important
as they have an understanding of the local needs and issues. Various local bodies
are functioning in the area to promote the livelihood opportunities for tribals and
marginalized, particularly women, children and the elderly.
The programmes must promote income-generating activities for tribals and the
underprivileged sections of the society particularly women. They provide
infrastructural support to schools and training centers, aid in rural electrification
through promoting solar street lights, bringing up the poor sections of the society
and betterment of the underprivileged sections of the society.
Large corporates have always been interested in doing their bit in improving the
well being of the people and condition of the environment. In order to do so,
they must first of all identify where technology can be put to use and what are
the limitations of urban areas. After making field visits, the zilla parishads (district
governing councils) and district rural development agencies (DRDAs) are
involved who are implementing major government programmes.
Similarly, big corporates are offering technical support in case of low-cost

affordable housing, village drainage system, drinking water supply, providing
warehouse for grain drying, seed storage, etc., depending on the type of expertise
available with them, which they may share under CSR obligations. Similarly, it
has been seen at various occasions that corporate and NGOs also help to arrange
loans for the poor from regional rural banks. These banks and financial institutions
need to support rural entrepreneurs who can popularize innovations and develop
new technologies. Corporates can also impart training to district rural development
officers and rural entrepreneurs who play a major role in various important
schemes of government.
You must have seen that telecom companies are joining hands with panchayats
and providing telecom services in rural areas. The corporate sector must be
encouraged to make more investment in rural areas in infrastructure, education,
health care, farming and non-farming areas, etc., which are key areas for
revitalizing the rural economy. Corporate investment in farming particularly by
agribased business firms such as ITC or Pepsi can create sustainable business
opportunities for farmers. Corporates have started entering in agriculture along
with manufacturing and services. In a way this is helpful if it does not disturb the
ecological balance of the area. For example, the contract farming initiative of
Pepsi provides a good framework for flow of credit to marginal/small farmers at
a reduced transaction cost. Pepsi India grows potatoes, seaweed and citrus fruits
under its contract farming initiative. It also proposes to restart its fruit and
vegetable business in Punjab.
The CSR of the rural local bodies is focused on holistic development of intended
communities, and moreover it aims to create long-term social and economic
significance for the organization and society. Infrastructural development in
rural areas is always ignored but should receive more focus now. As corporate
entities have the necessary technical expertise available with them, industrial
enterprises assisted by NGOs and rural entrepreneurs are best suited in developing
rural infrastructure such as roads, electricity, and water supply in rural areas
(Mital, 2004). Similarly, during water crisis, crop failure and during similar
192
situations, the corporate can lend their support by building water structures, Local Bodies
providing shelter relief, and so on. A number of companies in India engage with
local communities and the beneficiaries of these activities are also these
communities. The companies should try to develop such frameworks wherein
CSR can be extended across the nation with the support of local NGOs. CSR
projects undertaken in village areas must be sustainable and it is possible only
when the rural committees are made active partners in decision making and
implementation. It has also been noticed that even projects on health, employment
and education lack community participation and panchayat interventions.
With changing times, it is believed that corporate social responsibility must be

taken into the sphere of expanding the functions of local self government to
provide some benefit to the communities. It will lead to long term sustainability
and continuity and local self-governance helps to execute the policies with the
involvement of local people.
Case Study: “Project Swasthya Prahari” by Jubilant Life Sciences

Limited
Jubilant Life Sciences Limited is an integrated pharmaceutical and life
sciences company. The CSR initiatives of the group include various areas
such as community development, health care, culture & sports, environment
preservation, vocational training, women empowerment and education. Its
activities are primarily conducted at locations where Jubilant has operational
centers. Jubilant believes that for long term and sustainable social
interventions, it is the people who are best placed to help themselves. Jubilant
sees for itself the role of a facilitator or a catalyst in this process. The Project
Swasthya Prahari (Health Guards) in the area of health care aims to work for
community based mother and child health (MCH) programme. In this
programme, the objective is to train and create local talent pool to raise the
awareness and the coordination with various service providers. The project
aims at developing women health guards to work on safe motherhood for the
target population and promote institutional delivery. These guards are
identified from the local community around the manufacturing location. They
keep a record of expecting and lactating mothers, malnourished children,
birth and death, make personal contact with the villagers and motivate them
to visit health care centers.
Pani Panchayat is a voluntary activity of a group of farmers engaged in the

collective management (harvesting and distribution) of surface water and
groundwater (wells and percolation tanks). It was taken up by the farmers of
Maharashtra to collect rain water and generate water themselves for irrigation.
In 1972, the state of Maharashtra went through a severe drought crisis which
affected several hundred villages with a combined population of more than
400,000 people. At this time, the farmers were encouraged to take up watershed
management plan and water equity was addressed for the first time. A series
of contour bunds were raised to trap water runoff and also to protect the soil
from erosion. A percolation tank was constructed at the base of the hill slope
which was a micro-watershed. The estimated capacity of the percolation tank
was one million cubic feet of water. A well was dug below it and water pumped
from here up the hill slope for irrigating the fields. More than 4,000 trees
were planted amid the rocky areas and around 2,000 fruit trees were raised
on and around the more fertile bunds. Grass and shrub were allowed to grow
193
on land that was not being cultivated. The area was protected from animal
grazing for a while to enable the vegetation to gain strength. Eventually, as
the general health of the watershed improved as a result of these measures,
production from the land increased to 100 quintals (1 quintal = 100 kg) of
food grains.
Source: http://unossc1.undp.org/GSSDAcademy/SIE/Docs/Vol6/panipachayatpdf
5.5.2 Role of Urban Local Bodies in CSR

The importance of local bodies lies in the fact that large corporate houses do not
limit themselves according to the geographical boundaries. Their focus is on the
identification of basic needs of a community and afterwards they bring into line
the area highlighted by their trusts. The project lead by local bodies is determined
by moral obligation that they have to give back to the community to safeguard
their social welfare.
The key functional areas of urban local bodies in the field of CSR are:
1) Providing Healthcare and Eradication of Poverty
It includes activities such as organizing health camps, blood donation campaigns,
donating money for setting up medical infrastructure, providing medical
dispensaries. Efforts to reduce infant and maternal mortality, educating the masses
on issues like saving and educating the girl child - all coming under the purview
of promoting healthcare and poverty eradication. Providing electricity, safe
drinking water and sanitation, poverty alleviation campaigns, etc. are the key
functions of urban local bodies in which CSR funds could be invested.
2) Providing Education and Livelihoods

The Local Bodies consider education as an agent of change in society. Apart
from setting up of schools, as a part of their CSR agenda, the local bodies provide
scholarship to the deserving candidates for further studies and promote skill-
based projects which can provide employment to the people. Several local bodies
distribute sewing machines, or hardware to rural training centers or some others
provide free of cost meals to the workers or to the children in schools. Some
other CSR related functions of these bodies are promoting girl education and
also adult education in some cases. The Local bodies also cater to the needs of
the disabled by providing special infrastructure for the disabled and disadvantaged
section of the society. One of the important tasks of the local bodies in rural
areas is encouraging the growth of computer literacy by promoting IT education
in schools.
3) Promoting Gender Equality and Socio-economic Empowerment
Local Bodies promote gender equality and empower women by taking up several
capacity building campaigns. Similarly setting up working hostels for women,
old age homes for senior citizens, etc., are also taken up by certain local bodies.
In the urban areas, day care centers have been opened to support the working
women. Apart from this, initiatives have been taken to improve the conditions of
socially backward population as a part of CSR agenda.
4) Ensuring Environmental Sustainability
Environmental concerns have become very important these days. Whether it is a
194 rural area or urban area, you must have come across initiatives such as tree
plantation drivers, or river cleaning activities, or street sweeping drives. The Local Bodies
local bodies have taken up the task of promoting environmental sustainability
through measures such as organizing tree plantation programmes, setting up rain
water harvesting, installation of solar powered energy devices, etc. In the rural
areas, conservation of natural resources and preventing cutting of trees are the
main activities which are carried out these days.
5) Protecting and Preserving National Heritage, Culture and Art

CSR is also aimed at protecting national heritage, art and culture, including
protection of ancient buildings, conservation of historical monuments, setting
up public libraries, promotion and development of traditional arts and handicrafts.
Government initiatives like Swach Bharat, Beti Bachao Beti Padhao, and Skill
India are of interest to all stakeholders and can be a good means to foster
decentralized development.
As per the guidelines issued by the Ministry of Urban Development, urban local
bodies are empowered to approve the projects pertaining to building toilets in
urban areas. These bodies can sanction and implement projects to build individual
household toilets or community toilets.
The role of local bodies becomes very important in this regard. The local bodies
are mostly the NGO partners who have the expertise in the relevant area. In most
of the cases, the project models are defined by implementing agencies/ non-
profits based on local needs of the community.
Activity 2
Visit a CSR project being implemented by a local body in your vicinity and
write down the role/functions and responsibilities of the local body in
implementation of that project.
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5.6 CHALLENGES
There are several challenges that CSR is confronting these days in India. In
earlier times, legislation and regulation have determined the delivery of social
and environmental objectives. Limited resources of the government, ill framed
regulations, and flexible approaches have given rise to voluntary and non-
regulatory initiatives. Further, there is a lack of agreement amongst local agencies
regarding CSR activities. This lack of agreement often results in replication of
activities by corporate in areas of their involvement. There is also lack of interest
of the local community in participating and contributing to CSR activities of
companies. This is largely because of the fact that the local communities have
limited knowledge about CSR within them as no serious efforts have been made
to spread awareness about CSR and encourage the local communities about such
195
Stakeholders’ Engagement initiatives. The situation is further worsened due to lack of communication
between the company and the community at the grassroots.
Mostly the local bodies that implement CSR are in the area of education, health
or skill development or building infrastructure. In order to provide services, they
build new centers, provide medical assistance, organize camps. All these are
temporary solutions which do not bring out long term impact. The local
communities are not trained to provide these services and therefore there always
remains a void. On the contrary, the necessary skill needed to implement the
actions are lacking in local service providers. Also, when the funding stops, the
villages revert to the previous state. Therefore, external stimulus is fine but in
the absence of local bodies and trained officers, all the efforts are in vain. The
local bodies must be supported with trained manpower in order to carry out the
CSR activities. There is a need for capacity building of the local NGOs as there
is shortage of trained and efficient man power who can effectively contribute to
the ongoing CSR activities initiated by companies.
The communities are most of the time viewed as beneficiaries in the process of
CSR. However, to bring about a positive change, they must be regarded as partners
in plans and projects. By this move, the communities will feel motivated and
will take active interest. This is in fact the basic principle underlying sustainable
development.
Lack of integrated and holistic approach is one of the other challenges mostly
faced in these circumstances. Rural development covers varied aspects like
agriculture and allied activities like non-farm livelihoods, sanitation, etc. There
are certain gender, caste and cultural contexts which hinder the path of CSR
implementation in a uniform manner. Therefore, holistic approach is required
which can connect the dots between these issues. It is also found that there is
absence of well organized NGOs in distant rural areas that can identify and
consider the real needs of the community and work with companies to ensure
successful implementation of CSR activities.
In a number of occasions it has also been noticed that the panchayats get hold of
companies to practice CSR in the region and if the corporate denies participation,
the local people threaten them by calling out strike and other means of protest.
Several multinational companies in the past have been sent notices by local gram
panchayats asking them to undertake CSR works in their village. On investigation,
it has been found that the requests are not genuine.
1) What are the main issues addressed by CSR programmes in rural areas?
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196
2) What kind of CSR activities are taken up by the local bodies in urban areas? Local Bodies
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5.7 LET US SUM UP

Corporate social responsibility is practiced by organizations both big and small.
It is an attempt to address the social issues along with making profits. The big
corporate houses are contributing not only in terms of money but also through
various means for safeguarding the well being of the people and towards protecting
the environment. The local bodies are aware about the problems and critical
concerns of the local region. In this unit, you have read about the constitution of
the local body, its functions and the difference in the organization of rural and
urban local bodies. The CSR activities of the local bodies have been explained
in this unit. There is a difference in the functioning of the rural and urban local
bodies in spite of the fact that the basic objectives remain the same. In this unit
you have also learnt about the functions of the rural and urban local bodies. The
unit also explains the challenges faced by the local bodies in implementing CSR.
5.8 KEYWORDS
Local Bodies : Local bodies are institutions of the local self-governance, which
take care of the administration of villages, towns, or cities.
Rural Local Bodies: Local bodies which govern the administration of rural areas.
Urban Local Bodies: Local bodies which govern the administration of urban
areas
Governance: Process of administration of a village, town or city.

Atale, N., and Helge, E. J. (2014). Proposed framework for government of India
to effectively monitor mandatory CSR initiatives of public sector Enterprises in
India. Journal of Human Values, 20(1), 75-83.
Bajpai, G.N. (2001). Corporate Social Responsibility in India and Europe: Cross
Cultural Perspective, 2001 http://www.ficci.com.
CII (2013). Handbook on Corporate Social Responsibility in India, CII, PwC,

2013.
Mital, K.M. (2004). Indian Values, Trusteeship and CSR: Insights and Relevance.
Proceedings of the Fourth Global Conference on Flexible Systems Management,
Prime Publishing, Ghaziabad, December 26-29, 2004, p.645-662.
197
Stakeholders’ Engagement Pradhan, S., and Ranjan, A. (2011). Corporate social responsibility in rural
development sector: evidences from India. School of Doctoral Studies (European
Union) Journal, 2, 139-147.
https://www.bosch.in/media/our.../corporate_social_responsibility/pdf/
csrpolicy.pdf.
https://www.ey.com/...Government...Corporate-Social-Responsibility...India/.../
EY-Co...

ANSWERS
Answer 1. To look after the affairs of the urban areas, the urban local bodies
were created. After Constitution Act 74 Amendment, 1992, the urban local
bodies were given constitutional provisions which made them act
independently and were held responsible. Some of the functions of urban
local bodies are as follows:
1) Urban Planning including town planning; 2) Regulation of land use

and construction of buildings; 3) Planning for economic and social
development; 4) Roads and bridges; 5) Water supply for domestic, industrial
and commercial purposes; 6) Public health, sanitation conservancy and solid
waste management; 7) Fire services.
Answer 2. Under the welfare functions, urban local bodies must provide the
community services like playgrounds, community halls, markets, street
lighting, swimming pools, public conveniences, etc., for the welfare of the
people.
Answer 1. Therefore, corporate social responsibility in rural areas seeks to
address mainly infrastructure, education, health and sanitation, vaccination,
women empowerment, community welfare, environment protection, etc.
The local bodies are able to better monitor and govern these issues.
Answer 2. The key functional areas of urban local bodies in the field of CSR
are:
6) Providing Healthcare and Eradication of Poverty
7) Providing Education and Livelihoods
8) Promoting Gender Equality and Socio-economic Empowerment
9) Ensuring Environmental Sustainability
10) Protecting and Preserving National Heritage, Culture and Art
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Local Bodies
MEDS-052
CSR PROCESS
Block
4
CSR FOR SUSTAINABLE DEVELOPMENT
UNIT 1
UN SDGs
UNIT 2
Selection of Goals and Indicators
UNIT 3
Implementation Plan and Focus Area Alignment
UNIT 4
Collective Action and Collaboration
199
CSR for Sustainable
Development BLOCK 4 CSR FOR SUSTAINABLE
DEVELOPMENT
Block 4 CSR for Sustainable Development consists of four units.
Unit 1: UN-SDGs discuss the 17 United Nations Sustainable Development Goals

(UN SDGs) with respect to the targets of each goal and a selective list of indicators
under each of the goals. The unit also discusses NITI Aayog’s plan strategy and
vision with respect to the SDGs. Finally, it also discusses the significance of UN
SDGs from the business point of view and the role of business in achieving
them.
Unit 2: Selection of Goals and Indicators discusses the need to identify

sustainability risks and challenges in the business sector. It also discusses about
the corporate selection of individual goals and indicators. The alignment of goals
to corporate core strategy is also discussed.
Unit 3: Implementation Plan and Focus Area Alignment discusses national

and global imperatives from sustainable development point of view. The unit
also talks about the commonalities between CSR focus area and national and
global priorities.
Unit 4: Collective Action and Collaboration discusses SDG 17 on partnership

and collaborations. It also discusses the need for collaboration between academia,
industry and specialized agency. In addition, it describes the basic principles to
be kept in mind while going ahead with any collaboration.
200
UN SDGs
UNIT 1 UN-SDGS
Structure
1.1 Introduction
1.2 Understanding Sustainable Development Goals (SDGs)
1.3 Niti Aayog 3-7-15 Plan-Strategy-Vision with respect to UN-SDGs
1.4 Business Imperatives of UN-SDGs
1.5 Supporting Institutions for SDGs
1.6 Let Us Sum Up
1.7 Keywords
1.1 INTRODUCTION
The Sustainable Development Goals (SDGs) process started at the Rio +20
Conference held in 2012. After many multi-stakeholder meetings and discussions,
on September 25, 2015, the 193 countries of the United Nations General Assembly
adopted the 2030 Agenda for Sustainable Development, entitled “Transforming
Our World: The 2030 Agenda for Sustainable Development”, which seeks to
establish global consensus for the next 15 years. The SDGs (also known as UN-
SDGs or Global Goals) aim to address some of the world’s pressing economic,
social and environmental challenges. The emphasis is on environment
sustainability and equity in development. The SDGs are strongly interrelated –
within its own purview and also have connections with wide range of areas and
imperatives related to sustainable development. It has 17 goals with 169 actionable
targets and specific indicators which basically focus on 5Ps – People, Planet,
Prosperity, Peace and Partnerships. The ‘Future We Want’ outcome document of
Rio +20 clearly underlined the connection between ecosystem, sustenance and
human wellbeing. The achievement of each SDGs, therefore clearly benefits the
poor and the common theme of SDGs, is sustainability. In this unit we shall
discuss in the UN SDGs in detail.

Discuss the goals, targets and indicators covered under the 17 UN-SDGs
Explain Niti Aayog’s 3-7-15 year’s Plan-Strategy-Vision with respect to
UN-SDGs
Describe the significance of UN-SDGs from business point of view
Recognize the role of business in achieving SDGs
Identify supporting institutions for SDGs
1.2 UNDERSTANDING SUSTAINABLE

DEVELOPMENT GOALS (SDGS)
Let’s start with a brief overview of each of the goals and what they aim to do by
2030.
201
CSR for Sustainable Goal 1: End Poverty
Development
In spite of all the efforts made at the national, regional and international levels
since ages, more than 800 million people around the world still live in extreme
poverty today with an income of less than $1.25 a day. Now it’s high time that
we should make sincere efforts to end poverty in every possible way. This goal
will make sure that everyone irrespective of age, gender and income has access
and equal rights to basic services like food, shelter, clothing, healthcare, education
and social protection systems. This goal reduces the exposure to vulnerable events
and builds people’s resilience so they can actively participate in society with
confidence. An overview of all the targets and a selective list of indicators under
Goal 1 follows.
Box 1: Goal 1 – End Poverty in all its forms everywhere Targets
1.1 By 2030, eradicate extreme poverty for all people everywhere, currently
measured as people living on less than $1.25 a day
1.2 By 2030, reduce at least by half the proportion of men, women and
children of all ages living in poverty in all its dimensions according to
national definitions
1.3 Implement nationally appropriate social protection systems and measures

for all and by 2030 achieve substantial coverage of the poor and the
vulnerable
1.4 By 2030, ensure that all men and women, in particular the poor and the
vulnerable, have equal rights to economic resources, as well as access to
basic services, ownership and control over land and other forms of
property, inheritance, natural resources, appropriate new technology and
financial services, including microfinance
1.5 By 2030, build the resilience of the poor and those in vulnerable situations
and reduce their exposure and vulnerability to climate related extreme
events and other economic, social and environmental shocks and disasters
1.6 Ensure significant mobilization of resources from a variety of sources,

including through enhanced development cooperation, in order to provide
adequate and predictable means for developing countries, in particular
least developed countries, to implement programmes and policies to end
poverty in all its dimensions.
1.7 Create sound policy frameworks at the national, regional and international
levels, based on pro-poor and gender-sensitive development strategies,
to support accelerated investment in poverty eradication actions
A selective list of indicators under Goal 1 includes:
1) Proportion of population below $1.25 (PPP) per day
2) Proportion of population living below national poverty line, by rural/urban
3) Multidimensional Poverty Index
4) Percentage of eligible population covered by national social protection
programmes
202
UN SDGs
5) Percentage of women, men, indigenous people and local communities with
secure rights to land, property and natural resources, measured by (i)
percentage with documented or recognized evidence of tenure, and (ii)
percentage who perceive their rights are recognized and protected.
6) Losses by natural disasters by climate and non-climate events
7) Total Fertility Rate
For a comprehensive list of indicators, you may visit: https://unstats.un.org/
sdgs/indicators/database/
Goal 2: Zero Hunger

This goal aims to end hunger and malnutrition for all and develop a world where
everyone has access to sufficient and nutritious food all the year round. Together,
we must try to make it a reality. Currently, one in nine people in the world are
undernourished and go to bed hungry every night. The majority of these live in
developing or least developed countries. This goal focuses on addressing diverse
issues related to poor agricultural practices and productivity, malnutrition, food
waste and functioning of food commodity markets to ensure food security, with
enhanced nutritional value for all age groups across gender so that by 2030,
every single one will get sufficient nutritious food.
Box 2 provides an overview of all targets and a selective list of indicators under
Goal 2.
Box 2: Goal 2 –End hunger, achieve food security and improved

nutrition, and promote sustainable agriculture
Targets
2.1 By 2030, end hunger and ensure access by all people, in particular the
poor and people in vulnerable situations, including infants, to safe,
nutritious and sufficient food all year round
2.2 By 2030, end all forms of malnutrition, including achieving, by 2025,

the internationally agreed targets on stunting and wasting in children
under 5 years of age, and address the nutritional needs of adolescent
girls, pregnant and lactating women and older persons
2.3 By 2030, double the agricultural productivity and incomes of small-scale

food producers, in particular women, indigenous peoples, family farmers,
pastoralists and fishers, including through secure and equal access to
land, other productive resources and inputs, knowledge, financial services,
markets and opportunities for value addition and non-farm employment
2.4 By 2030, ensure sustainable food production systems and implement

resilient agricultural practices that increase productivity and production,
that help maintain ecosystems, that strengthen capacity for adaptation to
climate change, extreme weather, drought, flooding and other disasters
and that progressively improve land and soil quality
2.5 By 2020, maintain the genetic diversity of seeds, cultivated plants and
farmed and domesticated animals and their related wild species, including
through soundly managed and diversified seed and plant banks at the 203
CSR for Sustainable
Development national, regional and international levels, and promote access to and
fair and equitable sharing of benefits arising from the utilization of genetic
resources and associated traditional knowledge, as internationally agreed
2.6 Increase investment, including through enhanced international

cooperation, in rural infrastructure, agricultural research and extension
services, technology development and plant and livestock gene banks in
order to enhance agricultural productive capacity in developing countries,
in particular least developed countries
2.7 Correct and prevent trade restrictions and distortions in world agricultural
markets, including through the parallel elimination of all forms of
agricultural export subsidies and all export measures with equivalent
effect, in accordance with the mandate of the Doha Development Round
2.9 Adopt measures to ensure the proper functioning of food commodity

markets and their derivatives and facilitate timely access to market
information, including on food reserves, in order to help limit extreme
food price volatility

1) Proportion of population below minimum level of dietary energy
consumption
2) Percentage of women of reproductive age (15-49) with anaemia
3) Prevalence of stunting and wasting in children under 5 years of age
4) Percentage of infants under 6 months who are exclusively breast fed
5) Percentage of women, 15-49 years of age, who consume at least 5 out of
10 defined food groups
6) Crop yield gap (actual yield as % of attainable yield)
7) Number of agricultural extension workers per 1000 farmers (or share of
farmers covered by agricultural extension programmes and services)
8) Nitrogen use efficiency in food systems
9) Crop water productivity (tons of harvested product per unit irrigation
water)
Goal 3: Good Health and Wellbeing
We all know the significance of being healthy. The famous quote “Health is
Wealth” reminds us the importance of health in our lives. Over the last 25 years,
with the bloom of new and advanced technologies, we have made considerable
progress in preventing many harmful diseases and improving the child death and
maternal mortality rates. At the same time, we cannot ignore the numbers which
point out to the tragic fact that still more than six million children die before the
age of five each year or that AIDS is the leading cause of death for adolescents in
Sub-Saharan region. There is urgent need of a unified approach covering all
related aspects to ensure good health. This goal aims to take care of such related
issues.
204 Goal 3.
UN SDGs
Box 3: Goal 3 –Ensure healthy lives and promote wellbeing for all at all
ages
Targets
3.1 By 2030, reduce the global maternal mortality ratio to less than 70
per 100,000 live births
3.2 By 2030, end preventable deaths of newborns and children under 5

years of age, with all countries aiming to reduce neonatal mortality
to at least as low as 12 per 1,000 live births and under 5 mortality to
at least as low as 25 per 1,000 live births
3.3 By 2030, end the epidemics of AIDS, tuberculosis, malaria and

neglected tropical diseases and combat hepatitis, waterborne diseases
and other communicable diseases
3.4 By 2030, reduce by one third premature mortality from non-

communicable diseases through prevention and treatment and promote
mental health and well-being
3.5 Strengthen the prevention and treatment of substance abuse, including

narcotic drug abuse and harmful use of alcohol
3.6 By 2020, halve the number of global deaths and injuries from road
traffic accidents
3.7 By 2030, ensure universal access to sexual and reproductive healthcare

services, including for family planning, information and education,
and the integration of reproductive health into national strategies and
programmes
3.8 Achieve universal health coverage, including financial risk protection,

access to quality essential health-care services and access to safe,
effective, quality and affordable essential medicines and vaccines for
all
3.9 By 2030, substantially reduce the number of deaths and illnesses from
hazardous chemicals and air, water and soil pollution and
contamination
3.10 Strengthen the implementation of the World Health Organization

Framework Convention on Tobacco Control in all countries, as
appropriate
3.11 Support the research and development of vaccines and medicines for
the communicable and non-communicable diseases that primarily
affect developing countries, provide access to affordable essential
medicines and vaccines, in accordance with the Doha Declaration on
the TRIPS Agreement and Public Health, which affirms the right of
developing countries to use to the full the provisions in the Agreement
on Trade-Related Aspects of Intellectual Property Rights regarding
flexibilities to protect public health, and, in particular, provide access
to medicines for all
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CSR for Sustainable
Development 3.12 Substantially increase health financing and the recruitment,
development, training and retention of the health workforce in
developing countries, especially in least developed countries and small
island developing states
3.13 Strengthen the capacity of all countries, in particular developing

countries, for early warning, risk reduction and management of
national and global health risks
1) Maternal mortality ratio and rate
2) Neonatal, infant and under 5 mortality rates
3) Per cent of children receiving full immunization (as recommended by
national vaccination schedules)
4) HIV incidence, treatment, rate and mortality
5) Incidence, prevalence and death rates associated with all forms of TB
6) Incidence and death rates associated with malaria
7) Probability of dying between exact ages 30 and 70 from any of
cardiovascular disease, cancer, diabetes, chronic respiratory disease, (or
suicide)
8) Per cent of population overweight or obese, including children under 5
9) Road traffic deaths per 100,000 population
10) Consultations with a licensed provider in a health facility or the
community per person per year
11) Percentage of population without effective financial protection for health
care
Goal 4: Quality Education
Good and proper education plays a great role in shaping up our future and life. It
helps us to develop thoughts, points of view, and perspectives of looking at life,
gives us knowledge of the world around us and changes our personality to make
our lives better. Unfortunately, poverty armed with political and social conflicts
and enormous difficulties keep many kids around the world away from the basic
education. So, this goal is about ensuring quality education of all types (Primary,
Secondary, Vocational) and creating lifelong learning opportunities with equal
and affordable access for everyone across age, race and gender.
Goal 4.
Box 4: Goal 4 –Ensure inclusive and equitable quality education and

promote lifelong learning opportunities for all
Targets
4.1 By 2030, ensure that all girls and boys complete free, equitable and
quality primary and secondary education leading to relevant and effective
learning outcomes
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UN SDGs
4.2 By 2030, ensure that all girls and boys have access to quality early
childhood development, care and pre-primary education so that they
are ready for primary education
4.3 By 2030, ensure equal access for all women and men to affordable and
quality technical, vocational and tertiary education, including university
4.4 By 2030, substantially increase the number of youth and adults who
have relevant skills, including technical and vocational skills, for
employment, decent jobs and entrepreneurship
4.5 By 2030, eliminate gender disparities in education and ensure equal

access to all levels of education and vocational training for the
vulnerable, including persons with disabilities, indigenous peoples and
children in vulnerable situations
4.6 By 2030, ensure that all youth and a substantial proportion of adults,
both men and women, achieve literacy and numeracy
4.7 By 2030, ensure that all learners acquire the knowledge and skills needed
to promote sustainable development, including, among others, through
education for sustainable development and sustainable lifestyles, human
rights, gender equality, promotion of a culture of peace and nonviolence,
global citizenship and appreciation of cultural diversity and of culture’s
contribution to sustainable development
4.8 Build and upgrade education facilities that are child, disability and gender
sensitive and provide safe, nonviolent, inclusive and effective learning
environments for all
4.9 By 2020, substantially expand globally the number of scholarships

available to developing countries, in particular least developed countries,
small island developing States and African countries, for enrolment in
higher education, including vocational training and information and
communications technology, technical, engineering and scientific
programmes, in developed countries and other developing countries
4.10 By 2030, substantially increase the supply of qualified teachers,

including through international cooperation for teacher training in
developing countries, especially least developed countries and small
island developing states.
1) Percentage of children (36-59 months) receiving at least one year of a
quality pre-primary education programme
2) Early Child Development Index (ECDI)
3) Primary completion rates for girls and boys
4) Percentage of girls and boys who master a broad range of foundation
skills, including in literacy and mathematics by the end of the primary
school cycle (based in credibly established national benchmarks)
5) Secondary completion rates for girls and boys 207
CSR for Sustainable
Development 6) Percentage of girls and boys who achieve proficiency across a broad
range of learning outcomes including in literacy and in mathematics by
end of lower secondary schooling cycle (based on credibly established
national benchmarks)
7) Tertiary enrolment rates for women and men
Goal 5: Gender Equality

Inspite of achieving prosperity and commendable progress in almost every area
of life, we cannot say it robustly that there is any change in the way the girls and
women are being treated in our society, especially in the deprived and marginalized
section of the world. Continuously increasing rates of violence and discrimination
against women and girls in day to day life firmly confirms this plight. Goal 5 of
SDGs focuses on achieving gender equality by eliminating all forms of violence
and discrimination against women and girls, providing them equal and effective
access and rights to basic amenities in every front and helping them to reach
their full potential through enabling technologies, sound policies and enforceable
legislation.
Goal 5.
Box 5: Goal 5 –Achieve gender equality and empower all women and girls
Targets
5.1 End all forms of discrimination against all women and girls everywhere
5.2 Eliminate all forms of violence against all women and girls in the public
and private spheres, including trafficking and sexual and other types of
exploitation
5.3 Eliminate all harmful practices, such as child, early and forced marriage
and female genital mutilation
5.4 Recognize and value unpaid care and domestic work through the provision
of public services, infrastructure and social protection policies and the
promotion of shared responsibility within the household and the family
as nationally appropriate
5.5 Ensure women’s full and effective participation and equal opportunities
for leadership at all levels of decision-making in political, economic and
public life
5.6 Ensure universal access to sexual and reproductive health and reproductive
rights as agreed in accordance with the Programme of Action of the
International Conference on Population and Development and the Beijing
Platform for Action and the outcome documents of their review
conferences
5.7 Undertake reforms to give women equal rights to economic resources, as

well as access to ownership and control over land and other forms of
property, financial services, inheritance and natural resources, in
accordance with national laws
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UN SDGs
5.8 Enhance the use of enabling technology, in particular information and
communications technology, to promote the empowerment of women
5.9 Adopt and strengthen sound policies and enforceable legislation for the
promotion of gender equality and the empowerment of all women and
girls at all levels

1) Prevalence of girls and women 15-49 who have experienced physical or
sexual violence (by an intimate partner) in the last 12 months
2) Percentage of referred cases of sexual and gender-based violence against

women and children that are investigated and sentenced
3) Percentage of women aged 20-24 who were married or in a union by the

age of 18
4) Percentage of girls and women aged 15-49 years who have undergone
female genital mutilation
5) Average number of hours spent on paid and unpaid work combined (total
work burden), by sex
6) Percentage of seats held by women and minorities in national parliament

and/or sub-national elected office according to their respective share of
the population
7) Met demand for family planning
Activity 1
Write down the five UNSDGs discussed above. Write down the value of any
one of the indicators for the state of your residence for each of the five SDGs,
e.g.,
Goal 1: End Poverty; Proportion of population below poverty line (Delhi) =

9.91%
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Development
1) List out the first five sustainable development goals
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2) List out any three indicators for Goal 2 (Zero Hunger).

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Goal 6: Clean Water and Sanitation

Water is central to every sector of life – be it growth, development, the wellbeing
of society, culture, economy or environment. However, over the past decades,
pressures on water resources have increased dramatically due to rapid growth of
population, urbanization, higher consumption levels and climate vulnerability.
This goal targets to provide universal, equitable and adequate access to clean
water and basic sanitation facility for one and all while managing the water
resources sustainably through more integrated international and trans-boundary
cooperation, minimizing water pollution, protecting and restoring water-related
ecosystems including mountains, forests, wetlands, rivers, aquifers and lakes,
strengthening public participation, capacity building and technological
advancement.
Goal 6.
Box 6: Goal 6–Ensure availability and sustainable management of

water and sanitation for all
Targets
6.1 By 2030, achieve universal and equitable access to safe and affordable
drinking water for all
6.2 By 2030, achieve access to adequate and equitable sanitation and hygiene
for all and end open defecation, paying special attention to the needs of
women and girls and those in vulnerable situations
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UN SDGs
6.3 By 2030, improve water quality by reducing pollution, eliminating
dumping and minimizing release of hazardous chemicals and materials,
halving the proportion of untreated wastewater and substantially increasing
recycling and safe reuse globally
6.4 By 2030, substantially increase water use efficiency across all sectors
and ensure sustainable withdrawals and supply of freshwater to address
water scarcity and substantially reduce the number of people suffering
from water scarcity
6.5 By 2030, implement integrated water resources management at all levels,

including through trans-boundary cooperation as appropriate
6.6 By 2020, protect and restore water related ecosystems, including

mountains, forests, wetlands, rivers, aquifers and lakes
6.7 By 2030, expand international cooperation and capacity-building support

to developing countries in water- and sanitation related activities and
programmes, including water harvesting, desalination, water efficiency,
wastewater treatment, recycling and reuse of technologies
6.8 Support and strengthen the participation of local communities in improving

water and sanitation management
A selective list of Indicators under goal 6 includes:

1) Percentage of population using safely managed water services, by urban/
rural
2) Percentage of population using safely managed sanitation services, by
urban/rural
3) Percentage of wastewater flows treated to national standards (and reused)
4) Indicator on water resources management
5) Proportion of total water resources used
Goal 7: Affordable and Clean Energy
With continuously rising global population, more people will need energy to
light their homes and streets, use electronic accessories and do their day-to-day
activities. To meet this demand, they must have affordable access to energy
without any negative environmental consequences. In today’s world, when fossil
fuels and greenhouse gas emissions are creating many harmful effects on the
climate, meeting the current demand of clean sustainable energy at affordable
price will be a big challenge. It needs an integrated approach through more
international cooperation, upgradation of infrastructure and technology, eco-
efficient initiatives and energy services. SDG goal 7 emphasizes for an action to
ensure this for all.
Goal 7.
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CSR for Sustainable
Development Box 7: Goal 7–Ensure access to affordable, reliable, sustainable and
modern energy for all
Targets
7.1 By 2030, ensure universal access to affordable, reliable and modern energy
services
7.2 By 2030, increase substantially the share of renewable energy in the global
energy mix
7.3 By 2030, double the global rate of improvement in energy efficiency
7.4 By 2030, enhance international cooperation to facilitate access to clean

energy research and technology, including renewable energy, energy
efficiency and advanced and cleaner fossil-fuel technology, and promote
investment in energy infrastructure and clean energy technology
7.5 By 2030, expand infrastructure and upgrade technology for supplying

modern and sustainable energy services for all in developing countries,
in particular least developed countries, small island developing states,
and landlocked developing countries, in accordance with their respective
programmes of support
1) Share of population using modern cooking solutions, by urban/rural
2) Share of the population using reliable electricity, by urban/rural
3) Implicit incentives low carbon energy in the electricity sector (measured
as US$/MWh or US$ per ton avoided CO2)
4) Rate of primary energy intensity improvement
Goal 8: Decent Work and Economic Growth
One of the biggest challenges in today’s society is related to jobs. Job creation is
not keeping pace with the growing labour force. It severely affects economic
productivity as well as growth. This goal calls for increasing labour productivity
reducing the unemployment rate, especially for young people, promoting
development-oriented policies to support job creation with decent pay and safe
work environment, eradicating forced labour and protecting labour & human
rights, improving services, through innovation and creative entrepreneurship,
which are key components of sustained and inclusive economic growth.
Goal 8.
Box 8: Goal 8 – Promote sustained, inclusive and sustainable economic

growth, full and productive employment and decent work for all
Targets
8.1 Sustain per capita economic growth in accordance with national
circumstances and, in particular, at least 7 per cent gross domestic product
growth per annum in the least developed countries
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UN SDGs
8.2 Achieve higher levels of economic productivity through diversification,
technological upgrading and innovation, including focus on high value
added and labour-intensive sectors
8.3 Promote development-oriented policies that support productive activities,

decent job creation, entrepreneurship, creativity and innovation, and
encourage the formalization and growth of micro-, small- and medium
sized enterprises, through access to financial services
8.4 Improve progressively, through 2030, global resource efficiency in

consumption and production and endeavour to decouple economic growth
from environmental degradation, in accordance with the 10 year
framework of programmes on sustainable consumption and production,
with developed countries taking the lead
8.5 By 2030, achieve full and productive employment and decent work for
all women and men, including for young people and persons with
disabilities, and equal pay for work of equal value
8.6 By 2020, substantially reduce the proportion of youth not in employment,

education or training
8.7 Take immediate and effective measures to eradicate forced labour, end
modern slavery and human trafficking and secure the prohibition and
elimination of the worst forms of child labour, including recruitment and
use of child soldiers, and by 2025 end child labour in all its forms
8.8 Protect labour rights and promote safe and secure working environments
for all workers, including migrant workers, in particular women migrants,
and those in precarious employment
8.9 By 2030, devise and implement policies to promote sustainable tourism

that creates jobs and promotes local culture and products
8.10 Strengthen the capacity of domestic financial institutions to encourage

and expand access to banking, insurance and financial services for all
8.11 Increase Aid for Trade support for developing countries, in particular
least developed countries, including through the Enhanced Integrated
Framework for Trade-Related Technical Assistance to Least Developed
Countries
8.12 By 2020, develop and operationalize a global strategy for youth

employment and implement the Global Jobs Pact of the International
Labour Organization
1) GNI per capita (PPP, current US$ Atlas method)
2) Country implements and reports on Systems of Environmental-Economic
Accounting (SEEA) accounts
3) Youth employment rate, by formal and informal sector
4) Ratification and implementation of fundamental ILO labour standards
and compliance in law and practice 213
CSR for Sustainable Goal 9: Industry, Innovation and Infrastructure
Development
Despite steady progress in technology, operations and services, large number of
people around the world still lack access to basic infrastructure facilities such as
electricity, sanitation and communication services. For a society to grow
sustainably, resilient infrastructure should be developed with promotion of
sustainable industrialization through robust scientific research, technological
innovation and effective digital communication, which in turn will create
opportunities for everyone while protecting the world environment. Goal 9
strongly supports integrated cooperation and initiatives to facilitate such approach.
Goal 9.
Box 9: Goal 9 – Build resilient infrastructure, promote inclusive and

sustainable industrialization and foster innovation
Targets
9.1 Develop quality, reliable, sustainable and resilient infrastructure,
including regional and transborder infrastructure, to support economic
development and human wellbeing, with a focus on affordable and
equitable access for all
9.2 Promote inclusive and sustainable industrialization and, by 2030,

significantly raise industry’s share of employment and gross domestic
product, in line with national circumstances, and double its share in least
developed countries
9.3 Increase the access of small scale industrial and other enterprises, in
particular in developing countries, to financial services, including
affordable credit, and their integration into value chains and markets
9.4 By 2030, upgrade infrastructure and retrofit industries to make them

sustainable, with increased resource-use efficiency and greater adoption
of clean and environmentally sound technologies and industrial processes,
with all countries taking action in accordance with their respective
capabilities
9.5 Enhance scientific research, upgrade the technological capabilities of

industrial sectors in all countries, in particular developing countries,
including, by 2030, encouraging innovation and substantially increasing
the number of research and development workers per 1 million people
and public and private research and development spending
9.6 Facilitate sustainable and resilient infrastructure development in

developing countries through enhanced financial, technological and
technical support to African countries, least developed countries,
landlocked developing countries and small island developing States
9.7 Support domestic technology development, research and innovation in

developing countries, including by ensuring a conducive policy
environment for, inter alia, industrial diversification and value addition
to commodities
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UN SDGs
9.8 Significantly increase access to information and communications
technology and strive to provide universal and affordable access to the
Internet in least developed countries by 2020
1) Access to all weather road (% access within (x) km distance to road)
2) Mobile broadband subscriptions per 100 inhabitants, by urban/rural
3) Index on ICT maturity
4) Manufacturing value added (MVA) as percent of GDP
5) Total energy and industry-related GHF emissions by gas and sector,
expressed as production and demand-based emissions (tCO2e)
6) Personnel in R&D (per million inhabitants)
Goal 10: Reduced Inequalities

Inequality is quite visible throughout the world – the rich get richer and the poor
get poorer. The gap between developed and developing countries in various
spheres is quite evident. The problem is global in nature, so it requires cross
border solutions with national, international and trans-boundary participation of
all countries. To create a sustainable future for all, we must create and adopt
policies that create and facilitate opportunities for everyone across the age, race,
ethnicity and origin. Eliminating discriminatory laws, and practices and promoting
appropriate legislation, policies and actions, improving regulation and institutions
of financial markets and ensuring equal opportunity for all, especially for
developing countries through enhanced representation in global decision-making
process may help to minimize the gap. Goal 10 addresses this issue robustly, yet
in a comprehensive way.
Goal 10
Box 10: Goal 10 – Reduce inequality within and among countries
Targets
10.1 By 2030, progressively achieve and sustain income growth of the bottom
40 per cent of the population at a rate higher than the national average
10.2 By 2030, empower and promote the social, economic and political
inclusion of all, irrespective of age, sex, disability, race, ethnicity, origin,
religion or economic or other status
10.3 Ensure equal opportunity and reduce inequalities of outcome, including

by eliminating discriminatory laws, policies and practices and promoting
appropriate legislation, policies and action in this regard
10.4 Adopt policies, especially fiscal, wage and social protection policies,
and progressively achieve greater equality
10.5 Improve the regulation and monitoring of global financial markets and
institutions and strengthen the implementation of such regulations
215
CSR for Sustainable
Development 10.6 Ensure enhanced representation and voice for developing countries in
decision-making in global international economic and financial
institutions in order to deliver more effective, credible, accountable and
legitimate institutions
10.7 Facilitate orderly, safe, regular and responsible migration and mobility
of people, including through the implementation of planned and well-
managed migration policies
10.8 Implement the principle of special and differential treatment for

developing countries, in particular least developed countries, in
accordance with World Trade Organization agreements
10.9 Encourage official development assistance and financial flows, including

foreign direct investment, to states where the need is greatest, in
particular least developed countries, African countries, small island
developing States and landlocked developing countries, in accordance
with their national plans and programmes
10.10 By 2030, reduce to less than 3 per cent the transaction costs of migrant
remittances and eliminate remittance corridors with costs higher than 5
per cent
1) Indicator on inequality at top end of income distribution: GNI share of
richest 10% or Palma ratio
2) Percentage of households with incomes below 50% of median income
Activity 2
Write down the five UNSDGs discussed in the section above. Write down
the value of any one of the indicators for India for each of the five SDGs.
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Check Your Progress-2 UN SDGs

1) List out the sixth to tenth sustainable development goals
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2) List out any three indicators for Goal 6 (Clean water and sanitation).
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Goal 11: Sustainable Cities and Communities

A city is the center of culture, business and growth with modern infrastructure
and facilities. It attracts many people and migrants from nearby regions who
travel through the city in search of job, employment and better lifestyles every
day. It exerts additional pressures on urban environment and public health with
enormous challenges including growing numbers of slum dwellers, increased
pollution, inadequate basic services and unplanned urban sprawl, which make
cities more vulnerable to disasters. Better urban planning and management are
needed to make the world’s urban spaces more inclusive, safe, resilient and
sustainable. To achieve this target, Goal 11 urges for a collective action involving
broader range of people in urban planning decisions which can create better
facilities and opportunities for all with good public transport system, more clean,
green and safe public spaces, affordable public housing while safeguarding the
world’s cultural and natural heritage and environment.
Goal 11.
Box 11: Goal 11 – Make cities and human settlements inclusive, safe,
resilient and sustainable
Targets
11.1 By 2030, ensure access for all to adequate, safe and affordable housing
and basic services and upgrade slums
11.2 By 2030, provide access to safe, affordable, accessible and sustainable

transport systems for all, improving road safety, notably by expanding
public transport, with special attention to the needs of those in 217
CSR for Sustainable
Development
vulnerable situations, women, children, persons with disabilities and
older persons
11.3 By 2030, enhance inclusive and sustainable urbanization and capacity

for participatory, integrated and sustainable human settlement planning
and management in all countries
11.4 Strengthen efforts to protect and safeguard the world’s cultural and
natural heritage
11.5 By 2030, significantly reduce the number of deaths and the number
of people affected and substantially decrease the direct economic
losses relative to global gross domestic product caused by disasters,
including water-related disasters, with a focus on protecting the poor
and people in vulnerable situations
11.6 By 2030, reduce the adverse per capita environmental impact of cities,
including by paying special attention to air quality and municipal
and other waste management
11.7 By 2030, provide universal access to safe, inclusive and accessible,
green and public spaces, in particular for women and children, older
persons and persons with disabilities
11.8 Support positive economic, social and environmental links between
urban, peri-urban and rural areas by strengthening national and
regional development planning
11.9 By 2020, substantially increase the number of cities and human
settlements adopting and implementing integrated policies and plans
towards inclusion, resource efficiency, mitigation and adaptation to
climate change, resilience to disasters, and develop and implement,
in line with the Sendai Framework for Disaster Risk Reduction 2015-
2030, holistic disaster risk management at all levels
11.10 Support least developed countries, including through financial and

technical assistance, in building sustainable and resilient buildings
utilizing local materials
1) Percentage of urban population living in slums or informal settlements
2) Percentage of people within 0.5 km of public transit running at least
every 20 minutes
3) Ratio of land consumption rate to population growth rate, at
comparable scale
4) Losses from natural disasters, by climate and non-climate-related
events (in US$ and lives lost)
5) Mean urban air pollution of particulate matter (PM 10 and PM 2.5)
6) Area of public and green space as a proportion of total city space
7) Percentage of urban solid waste regularly collected and well managed
8) Domestic revenues allocated to sustainable development as per cent
218 of GNI
Goal 12: Responsible Consumption and Production UN SDGs
Due to rapid urbanization, unplanned industrialization and constant population

growth, natural resources are consumed faster than they can be restored, while
wastes and pollutants are released into the environment faster than the earth can
absorb them. It is an alarming situation and if it continues for few more years,
the pressure on the earth’s ecosystems and biosphere as a whole promise to
continue to mount in the foreseeable future. This goal wants us to act in a sensible
way and urges to think responsibly about the things we use, the waste we generate
and the impacts we create for our mother planet. Achieving this goal requires
sustainable business practices and consumer behaviour, efficient management
of natural resources and byproducts with adherence to international norms on
the management of hazardous chemicals and wastes, creating awareness about
responsible behaviour and consumption patterns, strengthening the scientific and
technological capacities to move towards more sustainable patterns of
consumption and production.
Goal 12.
Box 12: Goal 12 – Ensure sustainable consumption and production

patterns
Targets
12.1 Implement the 10 year framework of programmes on sustainable

consumption and production, all countries taking action, with developed
countries taking the lead, taking into account the development and
capabilities of developing countries
12.2 By 2030, achieve the sustainable management and efficient use of
natural resources
12.3 By 2030, halve per capita global food waste at the retail and consumer
levels and reduce food losses along production and supply chains,
including post-harvest losses
12.4 By 2020, achieve the environmentally sound management of chemicals

and all wastes throughout their life cycle, in accordance with agreed
international frameworks, and significantly reduce their release to air,
water and soil in order to minimize their adverse impacts on human
health and the environment
12.5 By 2030, substantially reduce waste generation through prevention,
reduction, recycling and reuse
12.6 Encourage companies, especially large and transnational companies,
to adopt sustainable practices and to integrate sustainability information
into their reporting cycle
12.7 Promote public procurement practices that are sustainable, in

accordance with national policies and priorities
12.8 By 2030, ensure that people everywhere have the relevant information
and awareness for sustainable development and lifestyles in harmony
with nature 219
CSR for Sustainable
Development 12.9 Support developing countries to strengthen their scientific and
technological capacity to move towards more sustainable patterns of
consumption and production
12.10 Develop and implement tools to monitor sustainable development

impacts for sustainable tourism that creates jobs and promotes local
culture and products
12.11 Rationalize inefficient fossil-fuel subsidies that encourage wasteful

consumption by removing market distortions, in accordance with
national circumstances, including by restructuring taxation and phasing
out those harmful subsidies, where they exist, to reflect their
environmental impacts, taking fully into account the specific needs
and conditions of developing countries and minimizing the possible
adverse impacts on their development in a manner that protects the
poor and the affected communities

1) Disclosure of Natural Resource Rights Holdings
2) Global Food Loss Index (or other indicator to be developed to track
the share of food lost or wasted in the value chain after harvest)
3) Consumption of ozone-depleting substances
4) Aerosol optical depth (AOD)
5) Share of companies valued at more than ($ 1 billion) that publish
integrated monitoring
Goal 13: Climate Action
The drastic effects of global warming and climate change is visible everywhere,
putting life and property in a vulnerable condition. To combat climate change
effects, concrete efforts combined with strong political will, integrated
cooperation, suitable policies, strategies, planning and technological measures
are needed at national and international level to build resilience and adaptive
capacity and limit climate related hazards and natural disasters. This goal lays
out a way for countries to work together to achieve this target.
Goal 13.
Box 13: Goal 13 – Take urgent action to combat climate change and its
impacts
Targets
13.1 Strengthen resilience and adaptive capacity to climate-related hazards
and natural disasters in all countries
13.2 Integrate climate change measures into national policies, strategies and
planning
13.3 Improve education, awareness-raising and human and institutional

capacity on climate change mitigation, adaptation, impact reduction and
early warning
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UN SDGs
13.4 Implement the commitment undertaken by developed-country parties
to the United Nations Framework Convention on Climate Change to a
goal of mobilizing jointly $100 billion annually by 2020 from all sources
to address the needs of developing countries in the context of meaningful
mitigation actions and transparency on implementation and fully
operationalize the Green Climate Fund through its capitalization as soon
as possible
13.5 Promote mechanisms for raising capacity for effective climate change-
related planning and management in least developed countries and small
island developing States, including focusing on women, youth and local
and marginalized communities
* Acknowledging that the United Nations Framework Convention on

Climate Change is the primary international, intergovernmental forum
for negotiating the global response to climate change.
A selective list of Indicators under goal 13 includes:
1) Availability and implementation of a transparent and detailed deep

decarbonisation strategy, consistent with the 2ºC or – below - global
carbon budget, and with GHG emission targets for 2020, 2030 and 2050.
2) CO2 intensity of new power generation capacity installed (gCO2 per

KWh), and of new cars (gCO2/pkm) and trucks (gCO2/tkm)
3) Net GHG emissions in the Agriculture, Forest and Land Use (AFOLU)
sector (tCO2e)
4) Official climate financing from developed countries that is incremental

to ODA (Official Development Assistance) (in US$)
Goal 14: Life below Water

Oceans, seas and marine resources are important parts of ecosystem. They play
a vital role in maintaining ecological balance. Ocean can absorb about 30 per
cent of carbon dioxide that humans produce. But these important marine structures
are getting severely depleted by increasing human activities, causing pollution
and enormous harms to marine species and coastal habitats. This goal aims to
prevent and significantly reduce marine pollution, sustainably manage and protect
marine and coastal ecosystems, effectively regulate harvesting and end illegal
overfishing, develop research capacities and marine technology and fully
implement international law to effectively conserve and manage the oceans, seas
and all their species.
Goal 14.
Box 14: Goal 14 – Conserve and sustainably use the oceans, seas and
marine resources for Sustainable Development
Targets
14.1 By 2025, prevent and significantly reduce marine pollution of all kinds,
in particular from land-based activities, including marine debris and
nutrient pollution 221
CSR for Sustainable
Development 14.2 By 2020, sustainably manage and protect marine and coastal ecosystems
to avoid significant adverse impacts, including by strengthening their
resilience, and take action for their restoration in order to achieve healthy
and productive oceans
14.3 Minimize and address the impacts of ocean acidification, including

through enhanced scientific cooperation at all levels
14.4 By 2020, effectively regulate harvesting and end overfishing, illegal,

unreported and unregulated fishing and destructive fishing practices
and implement science based management plans, in order to restore
fish stocks in the shortest time feasible, at least to levels that can produce
maximum sustainable yield as determined by their biological
characteristics
14.5 By 2020, conserve at least 10 per cent of coastal and marine areas,
consistent with national and international law and based on the best
available scientific information
14.6 By 2020, prohibit certain forms of fisheries subsidies which contribute

to overcapacity and overfishing, eliminate subsidies that contribute to
illegal, unreported and unregulated fishing and refrain from introducing
new such subsidies, recognizing that appropriate and effective special
and differential treatment for developing and least developed countries
should be an integral part of the World Trade Organization fisheries
subsidies negotiation
14.7 By 2030, increase the economic benefits to Small Island developing

States and least developed countries from the sustainable use of marine
resources, including through sustainable management of fisheries,
aquaculture and tourism
14.8 Increase scientific knowledge, develop research capacity and transfer

marine technology, taking into account the Intergovernmental
Oceanographic Commission Criteria and Guidelines on the Transfer of
Marine Technology, in order to improve ocean health and to enhance
the contribution of marine biodiversity to the development of developing
countries, in particular small island developing States and least
developed countries
14.9 Provide access for small-scale artisanal fishers to marine resources and
markets
14.10 Enhance the conservation and sustainable use of oceans and their
resources by implementing international law as reflected in UNCLOS,
which provides the legal framework for the conservation and sustainable
use of oceans and their resources, as recalled in paragraph 158 of The
Future We Want
1) Share of coastal and marine areas that are protected
2) Percentage of fish tonnage landed within Maximum Sustainable Yield
(MSY)
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Goal 15: Life on Land UN SDGs
Human and animal life is heavily dependent on various land forms for food,
shelter, air and maintenance of basic life supporting systems. But the negative
effects of unregulated human activities severely damage the beauty and serenity
of these beautiful ecosystems. As a consequence, deserts are spreading, arable
land is disappearing, forest cover is depleting, animal breeds are gradually
becoming extinct or threatened. To sustain our very survival on earth, it is
important that all these land ecosystems are properly managed and conserved.
This goal calls for a planned action to stop the things that threaten all land forms,
by adequately addressing deforestation, land degradation, loss of animal and
plant species, trafficking and supply of illegal wildlife products and protected
species of flora and fauna, and conservation and restoration of terrestrial
ecosystems.
Goal 15.
Box 15: Goal 15 – Protect, restore and promote sustainable use of

terrestrial ecosystems, sustainably manage forests, combat
desertifcation, and halt and reverse land degradation and halt
biodiversity loss
Targets
15.1 By 2020, ensure the conservation, restoration and sustainable use of

terrestrial and inland freshwater ecosystems and their services, in
particular forests, wetlands, mountains and drylands, in line with
obligations under international agreements
15.2 By 2020, promote the implementation of sustainable management of

all types of forests, halt deforestation, restore degraded forests and
substantially increase afforestation and reforestation globally
15.3 By 2030, combat desertification, restore degraded land and soil,

including land affected by desertification, drought and floods, and
strive to achieve a land degradation-neutral world
15.4 By 2030, ensure the conservation of mountain ecosystems, including

their biodiversity, in order to enhance their capacity to provide benefits
that are essential for sustainable development
15.5 Take urgent and significant action to reduce the degradation of natural
habitats, halt the loss of biodiversity and, by 2020, protect and prevent
the extinction of threatened species
15.6 Promote fair and equitable sharing of the benefits arising from the
utilization of genetic resources and promote appropriate access to
such resources, as internationally agreed
15.7 Take urgent action to end poaching and trafficking of protected species
of flora and fauna and address both demand and supply of illegal
wildlife products
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CSR for Sustainable
Development 15.8 By 2020, introduce measures to prevent the introduction and
significantly reduce the impact of invasive alien species on land and
water ecosystems and control or eradicate the priority species
15.9 By 2020, integrate ecosystem and biodiversity values into national

and local planning, development processes, poverty reduction
strategies and accounts
15.10 Mobilize and significantly increase financial resources from all sources
to conserve and sustainably use biodiversity and ecosystems
15.11 Mobilize significant resources from all sources and at all levels to
finance sustainable forest management and provide adequate
incentives to developing countries to advance such management,
including for conservation and reforestation
15.12 Enhance global support for efforts to combat poaching and trafficking
of protected species, including by increasing the capacity of local
communities to pursue sustainable livelihood opportunities

1) Annual change in forest area and land under cultivation
2) Area of forest under sustainable forest management as a per cent of
forest area
3) Annual change in degraded or desertified arable land (% or ha)
4) Red List Index (Extinction of threatened species)
5) Protected areas overlay with biodiversity
Goal 16: Peace, Justice and Strong Institutions
For any kind of development to flourish, peace is inevitable. And for maintaining
peace, justice and human rights should be properly guarded through adequate
and strong institutions.
Countries with significant violence, political conflict and insecurity can never
have a peaceful time, it ultimately hampers the development of society and the
region as well. This goal emphasizes on initiating action against all forms of
violence, abuse, trafficking and exploitation and tries to ensure a society, where
everyone can lead a peaceful life with any fear and threat.
Goal 16.
Box 16: Goal 16 – Promote peaceful and inclusive societies for sustainable
development, provide access to justice for all and build eûective,
accountable and inclusive institutions at all levels
Targets
16.1 Significantly reduce all forms of violence and related death rates
everywhere
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UN SDGs
16.2 End abuse, exploitation, trafficking and all forms of violence against
and torture of children
16.3 Promote the rule of law at the national and international levels and
ensure equal access to justice for all
16.4 By 2030, significantly reduce illicit financial and arms flows,

strengthen the recovery and return of stolen assets and combat all
forms of organized crime
16.5 Substantially reduce corruption and bribery in all their forms
16.6 Develop effective, accountable and transparent institutions at all levels
16.7 Ensure responsive, inclusive, participatory and representative decision-

making at all levels
16.8 Broaden and strengthen the participation of developing countries in

the institutions of global governance
16.9 By 2030, provide legal identity for all, including birth registration
16.10 Ensure public access to information and protect fundamental freedoms,

in accordance with national legislation and international agreements
16.11 Strengthen relevant national institutions, including through

international cooperation, for building capacity at all levels, in
particular in developing countries, to prevent violence and combat
terrorism and crime
16.12 Promote and enforce non-discriminatory laws and policies for

sustainable development
1) Violent injuries and deaths per 100,000 population
2) Number of refugees
3) Proportion of legal persons and arrangements for which beneficial
ownership information is publicly available
4) Revenues, expenditures and financing of all central government

entities are presented on a gross basis in public budget documentation
and authorized by the legislature
5) Percentage children under age 5 whose birth is registered with a civil

authority
6) Existence and implementation of a national law and/or constitutional

guarantee on the right to information
7) Perception of public sector corruption
Goal 17: Partnerships for the Goals
From previous explanations, one thing is very clear – SDGs’ implementation is
not an easy task at all and requires participation from everyone, from governments 225
CSR for Sustainable to private sectors, civil society, businesses, individuals and even volunteers. A
Development
stronger commitment to global partnership and cooperation, coherent policies,
an enabling environment for sustainable development at all levels and by all
actors of 193 participating countries would help make the goals a reality. Goal
17 proposes a line of action for nations to work together to achieve all other
goals.
Goal 17.
Box 17: Goal 17 – Strengthen the means of implementation and

revitalize the global partnership for sustainable development
Targets
Finance
17.1 Strengthen domestic resource mobilization, including through
international support to developing countries to improve domestic
capacity for tax and other revenue collection
17.2 Developed countries to implement fully their official development

assistance commitments, including the commitment by many
developed countries to achieve the target of 0.7 per cent of ODA/GNI
to developing countries and 0.15 to 0.20 per cent of ODA/GNI to
least developed countries, ODA providers are encouraged to consider
setting a target to provide at least 0.20 per cent of ODA/GNI to least
developed countries
17.3 Mobilize additional financial resources for developing countries from

multiple sources
17.4 Assist developing countries in attaining long-term debt sustainability

through coordinated policies aimed at fostering debt relief and debt
restructuring, as appropriate, and address the external debt of highly
indebted poor countries to reduce debt distress
17.5 Adopt and implement investment promotion regimes for least

developed countries
Technology
17.6 Enhance North-South, South-South and triangular regional and

international cooperation on and access to science, technology and
innovation and enhance knowledge sharing on mutually agreed terms,
including through improved coordination among existing mechanisms,
in particular at the United Nations level, and through a global
technology facilitation mechanism
17.7 Promote the development, transfer, dissemination and diffusion of

environmentally sound technologies to developing countries on
favourable terms, including on concessional and preferential terms,
as mutually agreed
226
UN SDGs
17.8 Fully operationalize the technology bank and science, technology and
innovation capacity-building mechanism for least developed countries
by 2017 and enhance the use of enabling technology, in particular
information and communications technology
Capacity Building
17.9 Enhance international support for implementing effective and targeted

capacity-building in developing countries to support national plans to
implement all the sustainable development goals, including through
North-South and triangular co-operation.
Trade
17.10 Promote a universal, rules-based, open, non-discriminatory and
equitable multilateral trading system under the World Trade
Organization, including through the conclusion of negotiations under
its Doha Development Agenda
17.11 Significantly increase the exports of developing countries in particular

with a view to doubling the least developed countries’ share of global
exports by 2020
17.12 Realize timely implementation of duty-free and quota-free market

access on a lasting basis for all least developed countries, consistent
with World Trade Organization decisions, including by ensuring that
preferential rules of origin applicable to imports from the least
developed countries are transparent and simple, and contribute to
facilitating market access
Systemic Issues
Policy and Institutional Coherence
17.13 Enhance global macroeconomic stability, including through policy
coordination and policy coherence
17.14 Enhance policy coherence for sustainable development
17.15 Respect each country’s policy space and leadership to establish and
implement policies for poverty eradication and sustainable
development
Multi-stakeholder partnerships
17.16 Enhance the global partnership for sustainable development,
complemented by multi-stakeholder partnerships that mobilize and
share knowledge, expertise, technology and financial resources, to
support the achievement of the sustainable development goals in all
countries, in particular developing countries
17.17 Encourage and promote effective public, public-private and civil

society partnerships, building on the experience and resourcing
strategies of partnerships
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CSR for Sustainable
Development Data monitoring and accountability
17.18 By 2020, enhance capacity building support to developing countries,
including for least developed countries and small island developing
states, to increase significantly the availability of high quality, timely
and reliable data disaggregated by income, gender, age, race, ethnicity,
migratory status, disability, geographic location and other
characteristics relevant in national contexts
17.19 By 2030, build on existing initiatives to develop measurements of

progress on sustainable development that complement gross domestic
product, and support statistical capacity-building in developing
countries

1) Domestic revenues allocated to sustainable development as per cent
of GNI (Gross National Index), by sector
2) Official development assistance and net private grants as per cent of
GNI
3) Private net flows for sustainable development at market rates as share
of high income country GNI, by sector
4) Annual report by Bank for International Settlements (BIS),
International Accounting Standards Board (IASB), International
Financial Reporting Standards (IFRS), International Monetary Fund
(IMF), World Intellectual Property Organization (WIPO), and the
SDGs and the implementation of relevant SDG targets
5) Share of SDG Indicators that are reported annually
6) Evaluate wellbeing and positive mood effect
Activity 3
Write down the five UNSDGs discussed in the section above. Write down the
value of any one of the indicators for India for each of the five SDGs.
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Check Your Progress-3 UN SDGs

1) List out the 11th to17th sustainable development goals.
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2) List out any three indicators for Goal 16 (Peace, Justice and Strong
Institutions).
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1.3 NITI AAYOG 3-7-15 PLAN-STRATEGY-

VISION WRT UN-SDGS
With the demolition of the Planning Commission and the 12th five-year plan of
India on March 31, 2015, the Government of India has set up The National
Institution for Transforming India (NITI Aayog) with a new idea of planning for
future development of India.
1.3.1 What is Niti Aayog’s 3 years plan?

The three year action agenda of the NitiAayog is for the period 2017-18 to 2019-
20. It can act as the first step towards attaining the envisioned SDG outcomes by
2031-32. The document is divided into 7 parts with 24 chapters, with a number
of specific action points for each part to boost India’s development. The key
parts of this document cover revenue and expenditure allocation, transforming
agriculture and industry services, regional development, connectivity, energy,
science and technology, governance, innovation, entrepreneurship, social sectors
and sustainability among others.
1.3.2 What is Niti Aayog’s seven year strategy?

The seven year strategy document known as the ‘National Development Agenda’
proposes policy framework and strategic interventions in line with SDGs.
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CSR for Sustainable
Development
1.3.3 What is Niti Aayog’s 15 years vision?
About 300 specific action points covering a wide range of sectors have been
drawn up as part of the 15 year vision. However, specific details of those action
points haven’t been made public yet.
1.4 BUSINESS IMPERATIVES OF UN-SDGS

1.4.1 Significance of goals, indicators and targets from business
point of view
The significance of Goals, Indicators & Targets from business point of view are
manifold:
a) The 17 Goals and 169 Targets formally adopted by the world community at
the General Assembly in September 2015 provides a clear roadmap for the
next 15 years (2016-2030) in which the governments, civil societies and
businesses are committed to eliminate worst situations affecting human
society like poverty, hunger, jobs and environmental destruction.
b) The stakeholder consultative approach prior to the formalization of SDGs

is different from similar efforts done in the past. It is with clear focus to
design a sustainable future for the whole world, with full commitment and
adherence to transparency and participation of multiple stakeholders.
c) The SDGs lay emphasis on the principle of justice, equity, participation

and transparency in governance that is necessary for Sustainable
Development connecting private, public and community resources to achieve
the same.
d) The role of businesses in India along with Government and civil society
would be effective by way of contribution in eliminating/minimizing gaps
particularly in the areas of poverty, unemployment, undernourishment,
gender gap, lack of skills, lack of accessibility to water, electricity, improper
waste management etc.
1.4.2 Role of business in achieving UN-SDGs

The SDG Agenda is transformative and calls for transforming our planning system
towards sustainable development of communities, society and economies, which
is in the interest of all including businesses. The SDG agenda sets out five key
opportunities for development that is (i) inclusive, (ii) universal, (iii) integrated,
(iv) locally focused and (v) technology driven (SDSN, 2015). SDGs cover a
wide range of areas encompassing waste, water, energy, wildlife, biodiversity,
climate change, health, education, poverty, gender equality, economic and social
growth. It gives ample scope for all including corporate, to work in multiple
sectors, involving diverse group of people and stakeholders. The role of business
is basically related to contributing to the SDG implementation as a facilitator
and catalyst and this needs to be understood from the development perspective.
Companies can advance sustainable development through the business practices
they adopt, the solutions they develop and the investments they make. Business
sector has enough potential to quickly respond and implement solutions with
230 localised innovations (SDG Compass,2015; KPMG,2017). IPCC AR 5
(Assessment Report (AR5) of the Intergovernmental Panel on Climate Change UN SDGs
(IPCC)) noted that India’s high vulnerability and exposure to climate change
will slow its economic growth, impact on human and environmental health and
make poverty reduction more difficult. So, the role of business in reducing its
carbon footprint is therefore apt in meeting the respective SDGs goal on climate
change. With 2ºC or less global temperature rise prediction by 2100, countries
need to prepare National de-carbonization strategies from now until 2050,
covering all sources for GHG emissions including energy, industries, agriculture,
forest, transport, building and other sectors. In this context, businesses from all
sectors can contribute towards strategy and policy formulation, technology
development and effective execution of de-carbonization strategies.
Activity 4
Visit any CSR project in your vicinity. Write in brief about the project objective
and identify the UNSDG that the project targets to achieve.
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1.5 SUPPORTING INSTITUTIONS FOR SDGS

With a range of diverse areas and interconnecting factors covered by all 17 goals,
there can be no single model for SDGs implementation which fits for all; each
sector, unit and business will have to determine their own set of institutional
arrangements to maximize their contribution towards SDGs implementation.
However, developing an institutional mechanism with the notion of inclusiveness,
combining multi-stakeholder consultation and collaboration, cross sectoral co-
operation, innovative planning and organizational structure to engage a broad
range of stakeholders including civil society and local authorities in priority
setting, implementation and review of SDGs, high-level political support with
coordinated government approach, integrated policies and strategies, availability
of quality information and data and suitable statistical institutions for monitoring
and evaluation, adequate financial, manpower and technical support empowered
with science and technology will be apt for SDGs implementation (SDSN, 2015;
Desai et al., 2018). Guidelines on The Development Initiative of the International
Organization (IDI) of Supreme Audit Institutions (SAIs), Principle Director of
Audit’s inclusion of SDG in the Audit Protocol, National Guidelines (NGs) on
Social, Environmental and Economic Responsibilities of Business, UNGC citizen
charters are few other means which can be served as supporting institutions for
SDGs. Clause 135 and Schedule VII of Companies Act provide good opportunities
for companies to deliver through Corporate Social Responsibility (CSR), which
can be effectively used as a supportive tool towards successful SDG
implementation.
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CSR for Sustainable Check Your Progress - 4
Development
1) What is Niti Aayog’s 3 years plan?
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2) What is the role of business in achieving UN SDGs?

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1.6 LET US SUM UP

We started this unit with a brief overview of 17 goals with its 169 actionable
targets and specific indicators, adopted by 193 countries on September 25, 2015
at the United Nations General Assembly as 2030 Agenda for Sustainable
Development. The emphasis of SDGs is on Environment Sustainability and Equity
in development, taking world’s pressing economic, social and environmental
challenges into account. The spotlight is on 5Ps – People, Planet, Prosperity,
Peace and Partnerships.
The National Institution for Transforming India (NITI Aayog) is the nodal agency
for transforming the SDGs into action in India. NITI has been assigned to prepare
a 15year perspective plan in line with sustainable development goals, a seven-
year strategy as part of the national development agenda and separately a three
year ‘Action Agenda’ for the overall development of the country.
With a focus on wide range of areas encompassing waste, water, energy, wildlife,
biodiversity, climate change, health, education, poverty, gender equality, economic
and social growth, SDGs hold special significance and potential for businesses
and provide ample scope and opportunities for Companies to work upon, to
achieve the aim of sustainable development of communities, societies and
economies.
Developing an institutional mechanism with the notion of inclusiveness encircling

multi-stakeholder participation, integrated policy, strategy and technology
advancement will be aptly support SDGs’ implementation. Clause 135 and
Schedule VII of the Companies Act provide good opportunities for companies to
232
deliver through corporate social responsibility (CSR), which can be effectively UN SDGs
used as a supportive tool towards successful SDG implementation.
1.7 KEYWORDS
National Poverty Line - A measure of relative poverty. People living below a
poverty line don’t have enough access to meet their basic needs.
Multidimensional Poverty Index - The global Multidimensional Poverty Index

(MPI) is an international measure of acute poverty. It complements traditional
income-based poverty measures by capturing the severe deprivations that each
person faces at the same time with respect to education, health and living
standards.
Indigenous People - Original inhabitants of a given region.
Total Fertility Rate - Total fertility rate (TFR) refers to total number of children
born or likely to be born to a woman in her life time.
Maternal Mortality Rate – The death rate of woman while pregnant or within
42 days of termination of pregnancy, irrespective of the duration and site of the
pregnancy, from any cause related to or aggravated by the pregnancy or its
management but not from accidental or incidental causes.
Neonatal Mortality Rate - Probability of dying during the first 28 days of life,
expressed per 1,000 live births.
Early Child Development Index - Early Child Development Index (ECDI) aims
to measure the developmental status of children within four domains: literacy-
numeracy, physical, and social-emotional development.
GNI and GDP - Gross national income (GNI) is a measure of a country’s

income. GDP only counts income received from domestic sources while GNI
includes net income received from abroad.
ILO Labour Standards - The International Labour Organization (ILO) is a

tripartite organization consisting of trade unions, governments and companies,
and is part of the United Nations system who set minimum standards for every
worker all over the world.
Aerosol Optical Depth - Aerosol optical depth (AOD) is a measure of the

extinction of the solar beam by dust and haze. Particles in the atmosphere (dust,
smoke, pollution) can block sunlight by absorbing or by scattering light. AOD
tells us how much direct sunlight is prevented from reaching the ground by these
aerosol particles.
Red Data Book - It is a public document which was created and maintained by
IUCN with a record of endangered and rare species including plants, animals,
fungi and few local subspecies present in a state or country.
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CSR for Sustainable
Development 1.8 BIBLIOGRAPHY AND SELECTED READINGS
Desai, R.M., Kato, H., Kharas, H., and McArthur, J.W. (2018). From Summits
to Solutions: Innovations in Implementing the Sustainable Development Goals.
Brookings Institution Press.
Development Alternatives Newsletter (2015). India Post 2015, 25(8), August
Issue. ISSN No.0974-5483 RNI No. 59360/94
GK Today (2017).Vision, Strategy and Three Year Action Agenda of NITI Aayog.
Retrieved September 19,2018 from https://www.gktoday.in/gk/vision-strategy-
and-three-year-action-agenda-of-niti-aayog/
WBCSD (2015). GRI, the UN Global Compact and the World Business Council
for Sustainable Development. The SDG Compass - The guide for business action
on the SDGs. UN and GRI report.
IGS (2015). Achieving the Sustainable Development Goals: From Agenda to
Action. Hayama: Institute for Global Environmental Strategies. ISBN/
ISSN: ISBN978-4-88788-189-1.
KPMG (2017). Sustainable development Goals (SDGs): Leveraging CSR to
achieve SDGs, India.
Panagariya, A. (2017). India 2031-32: Vision, strategy and Action Agenda. Niti
ayog.Goovernment of India,NewDelhi.
Singh, R.B., Mal, S., and Meadows, M.E. (2018). (Eds.) Sustainable Development
Goals Series. Springer Publication. ISSN: 2523-3084
SDSN (2015), Getting Started with the Sustainable Development Goals- A Guide
for Stakeholders, Sustainable Development Solutions Network, New York.
UN DESA (2018). The Sustainable Development Goals Report 2018. United
Nations, New York. e-ISBN: 978-92-1-363317-5
VSO (2017). What are the Sustainable Development Goals? Retrieved August
10, 2018 from https://www.vso.ie/fighting-poverty/influencing-and-advocacy/
sustainable-development-goals/what-are-the-sustainable-development-goals

ANSWERS
Answer 1. The first five SDGs are:
1) End Poverty
2) Zero Hunger
3) Good Health and Well Being
4) Quality Education
5) Gender Equality
Answer 2. Three targets of goal 2 are:
1) Proportion of population below minimum level of dietary energy
consumption
234
2) Percentage of women of reproductive age (15-49) with anaemia UN SDGs
3) Prevalence of stunting and wasting in children under 5 years of age

Answer 1. The Sixth to Tenth SDGs are:
1) Clean Water and Sanitation
2) Affordable and Clean Energy
3) Decent Work and Economic Growth
4) Industry, Innovation and Infrastructure
5) Reduced Inequalities
Answer 2. Three targets of Goal 6 are:
1) Percentage of population using safely managed water services, by urban/
rural
2) Percentage of population using safely managed sanitation services, by
urban/rural
Answer 1. The 11thto 17thSDGs are:
1) Sustainable Cities and Communities Affordable and Clean Energy
2) Responsible Consumption and Production
3) Climate Action
4) Life below Water
5) Life on Land
6) Peace, Justice and Strong institutions
7) Partnerships for the Goals
Answer 2. Three targets of Goal 16 are:
8) Violent injuries and deaths per 1000,000 population
9) Number of refugees
10) Proportion of legal persons and arrangements for which beneficial
ownership information is publicly available
Answer 1. The three year action agenda of the Niti Aayog is for the period
2017-18 to 2019-20. It can act as the first step towards attaining the
envisioned SDG outcomes by 2031-32. The document is divided into 7
parts with 24 chapters, with a number of specific action points for each part
to boost India’s development.
Answer 2. The role of business is basically related to contributing to the SDG
implementation as a facilitator and catalyst and this needs to be understood
from the development perspective. Companies can advance sustainable
development through the business practices they adopt, the solutions they
develop and the investments they make.
235
CSR for Sustainable
Development UNIT 2 SELECTION OF GOALS AND
INDICATORS
Structure
2.1 Introduction
2.2 Significance of Sustainability Risks and Challenges for Corporates
2.3 Corporate Selection of Individual Goals and Indicators
2.4 Alignment of Goals with Corporate Core Strategies
2.5 Let Us Sum Up
2.6 Keywords
2.1 INTRODUCTION
Companies are the engines of growth. These add to economic development,
employment, entrepreneurship and the overall national development. All
corporates and companies, big and small, have their growth models, which need
to be a part of the overall national development agenda, as well to be inclusive.
The premise is that the corporates and companies are part of the national wealth
and welfare; it is therefore important that the roadmap must be inclusive in nature
avoiding exclusions.
Business paradigm is changing and changing very fast. The new thinking about
CSR moving to corporate social opportunity while creating socio-economic and
environment benefits, is now gaining competitive edge. While conceptualizing a
CSR project, it becomes inevitable to strategize it in a deliberate manner, after
careful assessment of corporate risks and challenges and thereafter, aligning it
with corporate core strengths in line with national and global priorities including
SDGs.
Recognize and explain the significance of sustainability risks and challenges

for corporates
Identify sustainability risks and challenges of various companies/business

sectors
Identify suitable goals, indicators and areas to work upon, based on SDG
relevance and business priorities
Effectively plan and design your activities/programmes/projects in line with

company core strengths and taking sector-specific sustainability risks and
challenges into consideration
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Selection of Goals and
2.2 SIGNIFICANCE OF SUSTAINABILITY RISKS Indicators
AND CHALLENGES FOR CORPORATES

2.2.1 Why Identify Sustainability Risks and Challenges for the
Business Sector?
Sustainability is a triple bottom line approach where economic sustainability,
environmental sustainability and social sustainability are the important pillars.
While there are multiple challenges to maintain economic sustainability, it is
important to know what the corporate/company’s specific risks and challenges
in the environment sustainability and social sustainability areas are, and the ways
and means to mitigate those risks and challenges. Sustainability risks resulting
from both environmental and social issues have the potential to create significant
financial and non-financial impacts. It is also with this objective that strategic
CSR plays a vital role in the planning process and to develop course of action
that are commensurate with CSR objectives, corporate strategic planning should
be done scientifically and effectively. It would further help in strategizing CSR
for sustainable development pursuits, keeping national and global priorities in
focus.
2.2.2 Need of Mitigating Strategies for Sustainability Risks and

Challenges
After understanding the respective sustainability risks and challenges, the
mitigation (reduction) of the risks and challenges through appropriate intervention
would be necessary. The mitigation action needs to be consistent with the
corporate/company’s growth, sustenance and the well-being. Example: To combat
the problems arising out of carbon and GHG emission, adaptation to climate
change by enhancing investment in development programmes/sectors vulnerable
to climate change, particularly related to agriculture, water resources, health and
disaster management, Himalayan region, coastal region are important and could
as well be aligned with the broad objective of SDGs.
2.3 CORPORATE SELECTION OF INDIVIDUAL

GOALS AND INDICATORS
2.3.1 Identifying Sustainability Risks and Challenges of the
Company/Business
The selection of individual goals and indicators should be based on scientific
analysis, and it should not be a wish list. Sustainable Development Goals 1-6
basically cover social dimensions. Goals 7, 8 9, 12, 13, 14, 15 and 17 have vital
roles for the private sector and are related to business, while Goals 16 and 17 are
enablers of growth. The corporate/company’s aim should be to move away from
ad hoc philanthropy to strategic CSR and sustainability, thereby necessitating
apt selection of the related sustainable development goals and indicators. Box 1
provides some important information related to indicators and localization of
SDGs.
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CSR for Sustainable
Development Box 1: Indicators & Localization of SDGs
It is important to know what kind of indicators would be suitable to measure
the outcome of CSR initiatives and also how the SDGs could be localized to
achieve the overall aims and objectives. Related information in this regard is
given below:
Important to know that national indicators are the product of data.
While there are specific indicators given under each of the goals (SDGs),
yet there are national indicators available in many areas (Government of
India- Ministry of Statistics and Programme Implementation,2017).
Draft national indicators are available which are helpful in setting the
goals for companies. Ministry of Statistics and Plan Implementation
(MOSPI) is responsible for monitoring the indicators.
Localization of SDGs at the District and subdistrict levels is helpful.

Likewise, the convergence of multiple CSR pursuits by companies which
is helpful in achieving overall community development. SDGs recognize
the critical role the business must play in achieving them.
Every company has its own unique setup. The risks and challenges faced by
each sector are different. Accordingly, each company needs issue specific
mitigation strategies. Based on the sustainability risks and challenges of each
business sector, the strategic CSR for sustainable development initiatives/pursuits
should be planned by linking the activities with relevant SDGs. It is in this context,
the sector specific risks and challenges need to be identified as the first step.
Some of the sustainability risks and challenges for selected industry sectors are
as under:
a) Thermal Power Plant - Sector specific risks are GHG emissions, water usage,
waste water generation, ash, solid wastes, community impacts, etc.
b) Coal - Sector specific risks are environment pollution, health and safety,
GHG emissions, water etc.
c) Petroleum/Petrochemical Industry – Its essential processes involve burning

and handling/transportation of crude/multiple oils. Some of the important
sustainable risks associated with this industry are GHG emissions both from
CO2 and CH4 (Methane), issues related to water, bio-diversity, health and
safety, waste, etc. Therefore, it would be prudent for the industry to have
strategic CSR in the areas which would help mitigate the negative effects.
d) Mining- There are opencast and underground mines (coal, lignite, iron,
metal ores, etc.). Some mining work has GHG emissions trapped in the
coal seams. The overall mining production processes are hazardous. The
sustainability risks are dust, waste, GHG emissions, biodiversity, health
and safety, water, etc. Therefore, it is better for the industry to implement
strategic CSR for the community/society in these areas.
e) IT and related companies- Mobile networks, base transmission towers,

satellites, data centres and other infrastructure consume considerable amount
238 of electricity and fuel. Facebook and Google which are the backbone of
digital communication consume about 3per cent of the world’s electricity Selection of Goals and
Indicators
and are responsible for 2 per cent of the global greenhouse gas, or as much
as the aviation industry. The study estimates that by 2019, just charging
smart phones would account for greenhouse gas emissions equivalent to
the annual emissions of 1.1 million cars, therefore, the present day internet
seems to be inefficient from an environmental perspective. The ecological
imprint of data centres is enormous enough for Apple to have moved to 100
per cent clean energy to power their operations (Deora, 2018). Therefore,
the IT and related industries have a serious carbon footprint and their
sustainability risk can be mitigated by adoption of clean renewable energies,
enabling thereby Strategic CSR initiative in that direction.
f) Manufacturing (Machinery/Equipment) - It involves lot of raw material

usage, wastage and power-consumption (captive and grid power). The entire
process is energy intensive and the raw material consumption/production
adds to indirect emissions at the vendor premises, besides considerable
consumption of water, health and safety related issues. Suitable selection
of strategic CSR to mitigate the carbon footprint should be the focus area.
g) Pharmaceuticals- It involves use of organic and inorganic compounds, some

of which are non-biodegradable which can negatively affect ecosystems
and biodiversity when they end up in surface and ground waters through
end-of-life disposal. The significant environmental risks to these companies
are waste, biodiversity, health and safety. Therefore, such industries can
implement strategic CSR related to better health facilities with a focus on
bio-medical waste management.
h) Textiles, Tanneries, Paper and Pulp- These are water intensive industries
and utilize various chemicals such as dyes, bleaching agents, organic
solvents, heavy metals, etc. The sustainability risks posed by these industries
are water, emissions and odour, raw material consumption, health and safety,
etc. Therefore, such industries can implement strategic CSR related to
community water purification and distribution programmes, watershed
development programmes, etc.
i) Sugar, Distilleries and Food Processing Industries- These agro-based

industries use fermentation and other advanced technologies which result
in direct and indirect emissions during transportation, handling as well as
processing stages. Some of the sustainability risks associated with this
industry include raw material consumption, dust & GHG emissions, water,
health and safety, etc. Therefore, it would be prudent for the industry to
have strategic CSR in areas which would help mitigate the negative effects.
j) Automotive: The key sector specific risks are CO2 emissions and climate
change, environmental and safety standards in the supply chain,
sustainability strategy, product safety, energy consumption etc.
Keeping in view the sustainability risks and challenges, it is important to

identify how these risks are related to or may impede the progress and
thereby selection of the related sustainable development goals.
239
CSR for Sustainable
Development Activity 1
Meet two people doing business around your place of residence or work and
ask them to explain the sustainability risks and challenges of the set up they
are handling and note down their suggestions and make a list of sustainability
risks and challenges.
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2.3.2 Defining priorities from individual business point of view

and its relevance to specific SDG
Not all 17 goals will be equally relevant for every company. To benefit from the
opportunities presented by the SDGs, defining where your company’s priorities
are will help to narrow down the focus and intensify company’s efforts in right
direction (UN and GRI report, 2015). The choice of CSR projects/activities should
ideally be aligned with the business competencies and the sustainability challenges
while serving the society and mitigating the risks as well. It is in this context; the
corporate priority areas need to be identified with respect to and adequately
address the following:
a) How can CSR deliver powerful intervention for business and mitigating
sustainability risks/challenges of the sector?
b) What contribution can the CSR project make based on the core competency
of the sector?
c) What impact will CSR have on business, society and global issues?
d) How to measure the CSR impact on the business?
In a nutshell, the strategic direction of the CSR project should primarily focus on
respective sustainability risks and challenges, the selected areas of corporate/
company’s core competence and how and what they can do for society and nation
and its measurable impacts (Kompella, 2015). The selection of priority areas
could be based on one or all of the key elements or can have a combination of
key elements. Based on the outcomes, the strategic CSR for sustainable
development initiatives/pursuits should be planned and its relevance to specific
SDG can be explored.
A comprehensive list of key elements to be considered at the time of defining

priorities and aligning them with core business is provided in Box 2.
240
Box 2: Defining and aligning priorities with core business Indicators
The key elements for consideration would be as under:

Addressing business sustainability risks and challenges
Core strengths of the company
Priority areas with emphasis on local context/challenges
Priority areas with national and global importance
Policy guided approach
Scaling up and sustainability
Ease of reporting (measurable, reportable and verifiable)

1) What are the sustainability risks and challenges for a thermal power plant?
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2) What are the key elements to be considered while defining and aligning
priorities with core business?
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2.4 ALIGNMENT OF GOALS WITH CORPORATE

CORE STRATEGIES
Quite similar to the previous step, the alignment of strategic CSR projects with
corporate strategies could be as given below:
a) Aligning with core strength
b) Aligning with company’s sustainability risks, mitigation and business
impacts
c) Aligning with government plans and programmes with national and global
priorities including aspirational ones
241
CSR for Sustainable d) Aligning with future growth and development with special focus on local
Development
context/challenges.
a) Aligning with core strength

Selection of CSR initiative and its alignment with SDGs should be based on
respective strength, expertise and core competencies of the company (Kompella,
2015; SDSN, 2015; UN and GRI report, 2015). Example: A food company’s
brand is related to its products’ nutrition. Therefore, the logical extension of the
company’s CSR focus would be fighting malnutrition as it is one of the areas
covered under SDGs.
b) Aligning with company’s sustainability risks, mitigation and business

impacts
Based on the diversity of set-up, each sector has a unique risk and opportunity
component for businesses. It is important for businesses to comprehend these
and develop adequate mitigation strategies. The selection of goals and the
activities could be aligned to the corporate/company’s top-business impacts as
well. The alignment process should be suitably designed to minimize current
and potential negative impacts while making positive contributions to SDGs.
This should ensure the initiatives must cover company’s operations across the
entire value chain.
c) Aligning with government plans and programmes with national and

global priorities including aspirational ones
To add more value and maximize the company’s contribution towards sustainable
development, all CSR initiatives should be aligned with national & global
priorities and commitments. For example, in the COP 23, India has been declared
as the sixth most vulnerable nation for climate risks (KPMG, 2017). India is set
to rollout an integrated programme to cover greenhouse gases from agriculture.
The goal of the proposed project in select Indian states is to sequestrate 49.9
million tonnes of greenhouse gases. Aligning with a programme like this should
be one of the corporate core strategies. A detailed and comprehensive approach
for aligning the national and global priorities with CSR pursuits will be discussed
in next chapter – Unit3.
d) Aligning with future growth and development with special focus on

local context/challenges
Each region has its own circumstances, so the issues and challenges faced by
every region are quite different and context specific. Hence, alignment of initiative
and goals must carefully identify the ones that are most relevant to address their
local challenges and context (SDSN, 2015; United Nations, High Level Political
Forum, 2017).
Example: Stubble burning– During the post monsoon season we see crop residue
burning (stubble burning), though the practice is banned by the Indian
Government. The smoke generated by burning crops is carried by the North
Westerly winds during the post monsoon to other cities. It is one major source of
pollution; the impact of stubble burning adds to the existing pollution level in
local areas. Thus, burning of crop residue increases the pollution levels to a
great extent. Instead, the crop residue can be effectively utilized to generate
power locally through decentralized power generation. This could easily generate
242
employment of locals in the supply chain of stubble and also in the power Selection of Goals and
Indicators
generation process. This could be one potential area for strategic CSR initiative
which can contribute immensely to an age old local issue, with a problem solving
approach.
2.4.1 Plan, Design Your Activities/Programmes/Projects in Line

with Identified Priorities
The aim of a strategic CSR project is to benefit society and promote social equity
with priorities leading to:
Poverty alleviation
Better access to health, sanitation & environment
Employment/livelihood generation
Quality of life improvement
Women’s empowerment
Self help groups promotion
Education/skill development
While there are large number of CSR projects covering different areas, some of
the projects (indicative) which can be attended, to mitigate sustainable risks and
challenges besides the societal benefits and with respect to SDGs are summarized
in box 3.
Box 3: Potential Projects/Technologies/Activity areas for possible CSR and

sustainability intervention
BOX 3
Broad Area Potential Projects/Technologies/Activity
Areas
Renewable energy application Solar micro cold storage solutions
Micro grid power generation and distribution
Off grid hybrid (Wind/Solar) power
generation
Grid connected Solar power generation
Water Potable drinking water
Rain water harvesting
Water conservation
Water storage, water reservoirs
Making check dams in Arid zones and hilly
areas
Watershed management programme
Tank desiltation, storage and recharge
Water runoff arresting and storage
Irrigation practices including drip irrigation.
243
CSR for Sustainable
Development Current water usage in agriculture is 80 per
cent approx.
Waste Management Liquid and solid waste decentralised waste
(resource) management
Waste to energy plants in parks (tech used
controlled pyrolysis)
Organic waste to manure – Composting
Bio gas plants (cow dung/excreta) and other
organic wastes
Fly Ash utilisation-cement making,
reclamation of low lying areas, roads/
embankments/mine filling, bricks/tiles,
agriculture etc.
Plastic waste recycling/reuse (polyester fibre,
manufacture of denims, roads metalling), etc.
Radiation technology for hygienisation of
municipal dry sewage sludge (spin off tech
from BARC)
Usage of agriculture, water & waste
technologies from BARC
Bio mass (wheat/rice straw, Bio fuels etc. (ethanol production) and And
agriculture wastes/ Lignin (a polymer) extracted for power
residues generation
Bagasse – power generation
Biogas generation
Bio-diversity Biodiversity (plants, animals and eco-
systems) conservation
Biodiversity protection by limiting over
exploitation, habitat destruction and
introduction of invasive species
Desertification Fight desertification (check and reclaim) –
Reclaim deserts & restore to fertile
farmlands. Techniques include; agro-forestry
and farm managed natural regeneration.
Small community initiatives like closure of
degraded land for grazing curtailing farming,
growing fast growing plants, raising tall trees
that serve as a barrier against winds and
sandstorms
2.4.2 Set Goals for Each Strategic CSR Project/Activity

Each project is required to be undertaken in a project mode approach. While
setting goal for each strategic project/activity, it is important to understand the
interlinkages between the SDGs. The companies should set goals that cover all
their defined priorities across the economic, social and environmental aspects of
244 sustainable development (UN and GRI Report, 2015). The SDGs cannot be
implemented in isolation. Each goal has a connection with one or more goals. Selection of Goals and
Indicators
For example:
Goal 2 which focuses on hunger and sustainable food production also aims
to promote a resilient agricultural system to climate change (Goal 13)
Goal 12 on sustainable production and consumption (SCP), requires

sustainable management and efficient use of natural resources.
SDG 6 calls for significantly increasing water use efficiency across all
sectors and ensure sustainable withdrawals and supply of freshwater to
address water scarcity ~ that directly links to SDGs for health, resilient
infrastructure, sustainable cities, sustainable consumption, sustainable
oceans and sustainable ecosystems, inclusive societies and global
partnerships.
Industrialization (SDG-9) and economic growth (SDG-8) are critical for

poverty alleviation (SDG-1) besides other SDGs.
Therefore, implementation needs to be based on a highly integrated approach.
Box 4 gives a better understanding on the link between each goal and the proposed
activities therein, which can be referred and used suitably at the time of setting
goal for CSR project/ activity:
Box 4: Link between SDGs and Possible Activities
I) CLEAN WATER AND SANITATION:

Aim: “Ensure access to water and sanitation for all”
Activities: Protecting and restoring water-related ecosystems such as forests,

mountains, wetlands and rivers. Fostering international cooperation to
encourage water efficiency and support treatment technologies in developing
countries.
II) AFFORDABLE AND CLEAN ENERGY:

Aim: “Ensure access to affordable, reliable, sustainable and modern energy
for all”
Activities: Investing in clean energy sources such as solar, wind and thermal
and adopting cost-effective standards for a wider range of technologies.
Expanding infrastructure and upgrading technology to provide clean energy
sources in all developing countries.
III) DECENT WORK AND ECONOMIC GROWTH:

Aim: “Promote inclusive and sustainable economic growth, employment and
decent work for all”
Activities: Achieving higher levels of productivity through technological

innovation and promoting policies to encourage entrepreneurship and job
creation. These measures are critical to eradicate challenges such as forced
labour, slavery and human trafficking.
245
CSR for Sustainable
Development IV) INDUSTRY, INNOVATION AND INFRASTRUCTURE:
Aim: “Build resilient infrastructure, promote sustainable industrialization and
foster innovation”
Activities: Bridging the digital divide to ensure equal access to information

and knowledge, and as a consequence foster innovation and entrepreneurship.
V) REDUCED INEQUALITIES:
Aim: “Reduce inequality within and among countries”
Activities: Improving the regulation and monitoring of financial markets and
institutions, encouraging development assistance and foreign direct investment
to regions where the need is greatest. Facilitating the safe migration and
mobility of people is also key to bridging the widening divide.
VI) SUSTAINABLE CITIES AND COMMUNITIES:

Aim: “Make cities inclusive, safe, resilient and sustainable”
Activities: Making cities safe and sustainable, ensuring access to safe and
affordable housing, and upgrading slum settlements, investing in public
transport, creating green public spaces and improving urban planning and
management in a way that is both participatory and inclusive.
VII) RESPONSIBLE CONSUMPTION AND PRODUCTION:

Aim: “Ensure sustainable consumption and production patterns”
Activities: Halving per capital global food waste at the retailer and consumer
levels, creating more efficient production and supply chains. This can help
with food security and shift us towards a more resource efficient economy.
VIII) CLIMATE ACTION:

Aim: “Take urgent action to combat climate change and its impacts”
Activities: Strengthening the resilience and adaptive capacity of more vulnerable
regions, such as land locked countries and island sates; raising awareness and
integrating measures into national policies and strategies.
IX) LIFE BELOW WATER:

Aim: “Conserve and sustainably use the oceans, seas and marine resources”
Activities: Managing and protecting marine and coastal ecosystems from land-
based pollution, as well as addressing the impacts of ocean acidification.
Enhancing conservation and the sustainable use of ocean-based resources
through international law will also help mitigate some of the challengers facing
our oceans.
X) LIFE ON LAND:
Aim: “Sustainably manage forests, combat desertification, halt and reverse
land degradation, halt biodiversity loss”
Activities: Conserving and restoring the use of terrestrial ecosystems such as

forests, wetlands, dry lands and mountains by 2020. Promoting the sustainable
management of forests and halting deforestation.
246
XI) PEACE, JUSTICE AND STRONG INSTITUTIONS: Indicators
Aim: “Promote just, peaceful and inclusive societies”
Activities: Strengthening the rule of law and promoting human rights, reducing
the flow of illicit arms and strengthening the participation of developing
countries in the institutions of global governance.
XII) PARTNERSHIPS FOR THE GOALS:

Aim: “Revitalize the global partnership for sustainable development”
Activities: Enhancing North-South and South-South cooperation by supporting
national plans to achieve all the targets. Promoting international trade, helping
developing countries increase their exports, achieving a universal rules-based
and equitable trading system that is fair and open and benefits all.
Source: Accenture Strategy – Global Compact Network India (GCNI) report,
2016
Activity 2
Arrange a meeting with the CSR Department of a company near you and
discuss with them about the identified priority areas of their company. Ask
them to select most relevant SDGs and indicators to align with their identified
priorities? Note down their suggestions.
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2.4.3 Integration of the activities in core business strategies

Integrating planned activities into the core business strategies and embedding
sustainable development targets across all functions within the company is key
to achieving CSR goals. To be most effective, company’s sustainability goals
should be an integral part of core business strategies across the entire value chain
covering financial, strategic, operational areas, product lifecycle and service
offering, customer segments, supply chain management, transport and distribution
networks. The sustainability ambitions should be reflected in the vision, mission
and purpose statements of the company (UN and GRI report, 2015; World Bank
2017).
Hence, the core business strategies could be based on the following:
To tackle the emerging risks and to capitalize on new opportunities arising
thereof
Long term sustainability of organization
A holistic approach
Good strategy would be to take into consideration not only the business
risks, challenges and opportunities but also economic, environmental, social
and cultural elements related to businesses. 247
CSR for Sustainable To support sustainable decision making processes, stimulate organizational
Development
development, drive better performance, engage stakeholders and attract
investment, build trust and improve reputation, it is important to report and
communicate on company’s progress against the SDGs as the final implementation
step. To serve the purpose, companies should use internationally-recognized
standards for sustainability reporting such as GRI or CDP, etc. (UN and GRI
report, 2015; PwC 2015).
Note: a) Write your answer in about 50 words
1) What are the broad areas for possible CSR and sustainability intervention?
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2) What should be the basis of core business strategies?

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2.5 LET US SUM UP

We started this unit with an aim to understand how the corporates should select
suitable sustainable development goals and indicators and accordingly plan,
prepare and align their strategic CSR roadmap with core business strategies,
keeping in view the requirements under law, national and global imperatives and
understanding the sustainability risks and challenges, leading to sustainable
development.
Every company has its own unique setup, circumstances, sustainability risks and
challenges, thus each company needs sector/issue specific mitigation strategies.
So the corporate strategic planning should be done scientifically and effectively,
all corporates/companies should aim to move away from ad-hoc philanthropy to
strategic CSR and Sustainability pursuits, linking the activities with relevant
SDGs, thereby addressing the need of apt selection of the related sustainable
development goals and indicators. In this whole strategic development process,
identification of sector specific risks and challenges is the first and foremost
step.
248
Not all 17 SDGs will be equally relevant for every company/corporate. To Selection of Goals and
Indicators
streamline the focus and intensify company’s efforts in right direction,
defining each company’s priorities is essentially important. The selection of
priority areas should be based on respective sustainability risks and challenges,
corporate/company’s core competence, how and what they can do for society
and nation and its measurable impacts. Based on the outcomes, the strategic
CSR for sustainable development initiatives/pursuits should be planned and its
relevance to specific SDG can be explored.
In the next step, all identified priorities should be aligned with the core strength
of the company, its sustainability risks, business impacts and mitigation strategies
and also with national and global priorities, commitments while keeping in view
the local context/challenges.
In the final phase of implementation, it is important to report and communicate

on company progress against the SDGs as per the internationally-recognized
standards suggested by GRI or CDP, etc.
2.6 KEYWORDS
Strategic - It is an organization’s way of defining its plans, actions, directions
and process of making decisions on allocating its resources in a deliberate manner
to pursue its desired targets.
Mitigation – It is the process or act of reduction of the frequency, magnitude, or

severity of exposure to risks or minimization of the potential impact of a threat
or warning.
Technology Disruption – A means to change the traditional way that an industry

operates, especially in a wholly new and effective way.
Triple Bottom Line Approach – It is an approach which broadens an

organization’s focus on the financial line while giving due consideration to social
and environmental aspects. Environmental sustainability, social sustainability
and economic sustainability are three key areas of this concept. It is also referred
to People-Planet-Profits.
Convergence - The act of merging and moving toward union or uniformity.
Product Lifecycle – It refers to the different stages that a product goes through
from introduction to withdrawal.
Value Chain – A value chain is the whole set of activities that businesses go
through to bring a product or service to their customers, including production,
marketing and the after-sales service.
Supply Chain Management - Supply Chain Management involves a broad range

of activities required to plan, control and execute a product’s flow, from acquiring
raw materials to production and distribution to the final customer, in the most
streamlined manner.
249
CSR for Sustainable
Development 2.7 BIBLIOGRAPHY AND SELECTED READINGS
GCNI, (2016). Sustainable Development Goals – Broadening the horizon for
India’s growth and transformation. GCNI-Accenture strategy report.
Deora, M. (2018). Let’s Start Greening the Net. Economic Times.
Government of India, (2017). Draft National Indicator Framework for

Sustainable development Goals (SDGs). Ministry of Statistics and Programme
Implementation, Central Statistics office, Government of India.
WBCSD, (2015). The SDG Compass - The guide for business action on the SDGs.
UN and GRI report.
Haq, Z. (2018). Govt Plans 65k-Cr Project To Reduce Greenhouse Gases from
Agriculture. Hindustan Times. September 24, 2018.
Kompella, K. (2015). Being the good Samaritan - How corporate social

responsibility can make a perceptual difference to a brand, Corporate Dossier,
The Economic Times, p.3. August 21-27, 2015.
KPMG (2017). Sustainable development Goals (SDGs): Leveraging CSR to

achieve SDGs, India. Proceedings of First Sustainable Development Goals
Summit, 2017
PwC. (2015). Make it your business: Engaging with the Sustainable Development
Goals. PwC – UK manual.
PwC. (2015). How ready is business to support government achieve the goals?
SDG Engagement Survey Report
SDSN. (2015), Getting Started with the Sustainable Development Goals- A Guide
United Nations (2017). Voluntary National Review Report on the Implementation

of Sustainable Development Goals. High Level Political Forum, 2017, New York.
World Bank (2017). Atlas of Sustainable Development Goals 2017: From World
Development Indicators. World Bank Atlas. Washington, DC: World Bank.

ANSWERS
Answer 1. The sustainability risks and challenges for a thermal power plant
are: - GHG emissions, water usage, waste water generation, ash, solid wastes,
community impacts, etc.
Answer 2. The key elements for consideration while defining and aligning
priorities with core business would be as under:
i) Addressing business sustainability risks and challenges
ii) Core strengths of the company
250
iii) Priority areas with emphasis on local context/challenges Selection of Goals and
Indicators
iv) Priority areas with national and global importance
v) Policy guided approach
vi) Scaling up and sustainability
vii) Ease of reporting (measurable, reportable and verifiable)
Answer 1. The broad areas for possible CSR and sustainability intervention
are
1) Renewable energy application
2) Water
3) Waste management
4) Bio mass (Wheat/Rice straw, etc.) and Agriculture wastes/residues
5) Biodiversity
6) Desertification
Answer 2. Hence, the core business strategies could be based on the following:
To tackle the emerging risks and to capitalize on new opportunities
arising thereof
Long term sustainability of organization
A holistic approach
Good strategy would be to take into consideration not only the business
risks, challenges and opportunities but also economic, environmental,
social and cultural elements related to businesses.
251
CSR for Sustainable
Development UNIT 3 IMPLEMENTATION PLAN AND
FOCUS AREA ALIGNMENT
Structure
3.1 Introduction
3.2 National Imperatives from Sustainable Development Point of View
3.3 Global Imperatives from Sustainable Development Point of View
3.4 Identifying Commonalities between CSR Focus Areas and Other National/
Global Priorities
3.5 Alignment of Corporate Strategy with CSR-SDGS-SD Initiatives
3.6 Let Us Sum Up
3.7 Keywords
3.1 INTRODUCTION
In order to achieve the objective of sustainable development, it is important that
the business sector, corporates and companies conceptualize and implement
projects in a strategic manner so that their business strategies align with the
national and global imperatives. To accomplish this, it is important to familiarize
with the imperatives at national and global level since India is a signatory to
these and corporates/companies to understand the responsibilities and
opportunities they have as the business community. Understanding the
imperatives, the synergies, convergence and interconnectedness that exist between
different global and national initiatives would help in the development of a
corporate/company’s plan, a roadmap that could be aligned to the national
development agenda and/or global commitments. Interalia this would help develop
strategic CSR for sustainable development pursuits of respective corporates/
companies.
Recognize and understand various national priorities and commitments from
a sustainable development point of view
Recognize and understand various international priorities and commitments
from a sustainable development point of view
Develop understanding on the potential of CSR thematic areas to achieve
sustainable development
Identify commonalities between CSR focus areas and other national/global
sustainable development imperatives, including SDGs
Analyse the opportunities that national and global priorities/initiatives offer
for effective corporate planning
252
Implementation Plan and
3.2 NATIONAL IMPERATIVES FROM Focus Area Alignment
SUSTAINABLE DEVELOPMENT POINT OF

VIEW
National imperatives refer to the initiatives, plans, programmes and commitments
made or have to be made based on the national priorities, in order to achieve
sustainable development. These are the key strategic means of advancing national
obligation towards global sustainable development commitments. Some of the
top national priorities in today’s time, as stated by the Indian Government include
skill development, health, hygiene, clean and safe water, energy, waste, climate
change, etc. (KPMG, 2017). To support the country’s commitment towards
international sustainable development agenda and accelerate the value creation
process, all the CSR initiatives should be aligned with national priorities, which
in turn will contribute to global priorities as well. In the following section, we
will discuss about various national imperatives initiated by the Government to
achieve the goals of sustainable development.
3.2.1 Schedule VII and Companies Act, Section 135

You have already read about the Companies Act in the first course in detail. For
the first time in any region of the world, CSR for companies has been mandated
through legislation in India in 2013-14, with the introduction of Section 135, the
Companies Act 2013 and the Companies (Corporate Social Responsibility Policy)
Rules, 2014 and Schedule VII. The overall governance of CSR process was
notified on 27th February, 2014 and came into force from 1st April, 2014 across
India. Section 135 of the Companies Act contains CSR provisions of the Act,
Schedule VII of the Act enumerates the activities that can be undertaken under
CSR and Companies (Corporate Social Responsibility Policy) rules, 2014 and it
prescribes the manner in which companies would comply with the CSR provision
of the Act (Government of India - Ministry of Corporate Affairs, 2014).Thematic
areas covered under Schedule VII include hunger, poverty, health, safety,
education, sanitation, women empowerment, environmental sustainability, rural
development among others. The planning, designing and implementation of CSR
projects and activities would be on the lines of these statutory provisions that
will assist the company/corporate not only to comply with the law while
contributing significantly towards the marginalised sections of the society. It
would also effectively contribute towards the SDGs and other commitments of
national and global importance.
3.2.2 Nationally Determined Contributions (NDCs)

Nationally determined contributions (NDCs) are the outcome of historic Paris
Agreement, signed by 195 countries of the United Nation’s Framework
Convention on Climate Change (UNFCCC) at COP 21 in Paris, on 12 December
2015. The Paris Agreement (Article 4, paragraph 2) requires each country to
prepare, communicate and maintain successive nationally determined
contributions (NDCs) that it intends to achieve and submit an updated climate
plan every five years, thereby steadily increasing their ambition in the long-term
(Hare et al.,2017; UNCCS, 2017). In other words, NDCs represent efforts by
each country to reduce national emissions and mitigate negative impacts of climate
change. They urge every country to adopt a climate friendly and cleaner path to
combat climate change. It has three key targets to meet by 2030: 253
CSR for Sustainable 1) Reduce emissions intensity of country’s GDP by 33-35% by 2030 from
Development
2005 level
2) Achieve 40 per cent power generation from non-fossil fuels
3) Create additional carbon sink of 2.5 to 3 billion tons of CO2 by adding to
forest and tree cover
It encourages industries to better adapt to climate change by enhancing

investments in programmes in sectors vulnerable to climate change development.
Aligning your CSR activities with NDCs objectives will therefore help your
organization to deliver effectively towards climate change issues, which is one
of the serious concerns across the world and a prominent theme in all global
commitments.
3.2.3 National Action Plan on Climate Change (NAPCC)

National Action Plan on Climate Change (NAPCC) is a comprehensive action
plan which outlines measures on climate change related adaptation and mitigation
by India. These include: National Solar Mission, National Mission for Enhanced
Energy Efficiency, National Mission on Sustainable Habitat, National Water
Mission, National Mission for Sustaining the Himalayan Ecosystem, National
Mission for a Green India, National Mission for Sustainable Agriculture, National
Mission on Strategic Knowledge for Climate Change (Prime Minister’s Council
on Climate Change, Government of India). In order to make India more responsive
to cover far-ranging effects of Climate Change, Central government is planning
to add four new areas (The Hindu, 2017). So CSR new missions related to wind
power, coastal zones, waste-to-energy and impacts of climate change on human
health activities aligned with and contributing to these 12 missions under NAPCC
will certainly add more value to any business sector.
3.2.4 National Mission on Himalayan Studies (NMHS)

To launch and support innovative studies and related knowledge and technology
interventions towards the sustenance and enhancement of the ecological, natural,
cultural, and socio-economic capital assets and values of the Indian Himalayan
Region, National Mission on Himalayan Studies (NMHS) was launched by
Ministry of Environment, Forest and Climate Change (MoEF&CC). It is expected
to address more than 25 indicative Thematic Areas of Work under broad themes
such as Water Resource Management, Livelihood Options and Employment
Generation, Biodiversity Conservation and Management, Skill Development and
Capacity Building, Infrastructure Development, Physical Connectivity and
Handling of Hazardous substances for the well-being of the Indian Himalayan
Region and mountain communities in the region. The NMHS will also serve to
complement and supplement the outcomes of National Mission on Sustaining
Himalayan Ecosystem (NMSHE) anchored by the Department of Science and
Technology (DST) under the National Action Plan on Climate Change (NAPCC)
(Government of India – National Mission on Himalayan Studies, 2016). Therefore,
any CSR initiatives in these areas on the suggested themes will highlight your
company’s efforts towards biodiversity conservation while maximizing their
contribution towards NMSHE and SDGs as well.
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3.2.5 National Guidelines on the Economic, Social and Implementation Plan and
Focus Area Alignment
Environmental Responsibilities of Business
National Guidelines on the Economic, Social and Environmental Responsibilities
of Business are the updated version of National Voluntary Guidelines (NVGs),
rolled out by the Ministry of Corporate Affairs in July 2011. The NVGs comprised
nine interrelated principles and their attendant core elements and represented a
holistic approach to be adopted by companies as part of their business practices
and responsibility. The updated National Guidelines also have nine principles,
accompanied by a set of core elements with requirements and actions that are
essential to the actualisation of the principles. Few key focus areas under the
National Guidelines are on sustainable production and consumption, inclusive
growth and equitable development, engagement by stakeholders, ethical
behaviour in all its functions, proactive public disclosure by companies of their
impact on society and the environment and providing value to consumers in a
responsible manner (Draft National Guidelines, 2018). The Securities and
Exchanges Board of India (SEBI) in 2012 on the basis of these guidelines
mandated the top 500 companies to furnish Annual Business Responsibility Report
(ABRR) providing an impetus to the uptake of NVGs by business. NVGs contain
a structured business responsibility reporting format requiring certain specified
disclosures, demonstrating the steps taken by companies to implement the said
principles. Now this can be reported against revised National Guidelines. So,
while designing a CSR and Sustainability project, it is always desirable to design
it on the similar lines of National Guidance. It will guide the project to execute
effectively to achieve targets set in SDGs and other sustainable development
agenda while satisfying the compliance part and thereby adding more value to
your business project.
3.2.6 SEBI-Business Responsible Reporting (SEBI-BRR)

Securities and Exchange Board of India (SEBI) on 13th August 2012, under Listing
Obligations and Disclosure Requirements Regulations (“Listing Regulations”),
2015 mandated the inclusion of Business Responsibility Report (BRR) as a part
of the Annual Report for top 500 listed companies. This report expects to describe
the initiatives taken by the listed entity against the nine principles of the National
Guidelines (earlier NVGs) from an environmental, social and governance
perspective (SEBI, 2015).
Furthermore, to improve disclosure standards and help shareholders make

informed decision, SEBI has advised these 500 entities to voluntarily
adopt integrated reporting framework from the financial year 2017-18. The
information related to integrated reporting should be provided in the annual report
separately or by incorporating in ‘Management Discussion & Analysis’ or by
preparing a separate report. As a green initiative, the companies may host the
integrated report on their website and provide appropriate reference to the same
in their annual report to highlight their sustainable business practices (The Times
of India, 2017).
3.2.7 DPE CSR and Sustainability Guidelines

The Department of Public Enterprise’s (DPE), Government of India issued CSR
guidelines for Central Public Sector Enterprises (CPSEs) in April, 2010 and
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CSR for Sustainable revised guidelines on CSR and Sustainability with effect from 1st April, 2013.
Development
The earlier guidelines focused mainly on how social causes and environmental
concerns could be addressed through CSR projects, funded by an earmarked
budget for this purpose and it mainly targeted external stakeholders. In the revised
guidelines, CSR and sustainability agenda is perceived to be equally applicable
to internal stakeholders (particularly, the employees of a company). Accordingly,
the revised guidelines are expected to formulate the company policies with a
balanced emphasis on all aspects of CSR and Sustainability with regard to their
internal operations, activities and processes, as well as in their response to
externalities (Department of Public Enterprises, 2014).
The thrust of CSR and sustainability guidelines is clearly on capacity building,

empowerment of communities, inclusive socio-economic growth, environment
protection, promotion of green and energy efficient technologies, development
of backward regions and upliftment of the marginalized and underprivileged
sections of the society. Taking up at least one major project in the defined areas
in line with DPE guidelines has the potential of delivering significantly in the
long run to socio-economic growth in all the backward regions of the country
and thereby enhancing their contributions to diverse national and global priorities.
Apart from these initiatives, India has many developmental projects, ambitious
plans and programmes in the areas of power, housing, renewable energy,
agriculture, income generation, etc. Several innovative state-level sustainable
development agendas and missions focusing on SDGs are also being launched
by state governments of Assam, Andhra Pradesh, Sikkim, Haryana, Gujarat,
Rajasthan, Maharashtra during past few years (Box 1), which provide enough
scope and opportunities for businesses to act upon suitably in the areas of health,
education, agriculture, environment, community development, capacity building,
etc. Aligning with one or more such initiatives will extensively help the company
to support National Development Agenda and will drive India towards sustainable
development, which significantly adds value to the organization and reputation.
Box 1: State-Level Initiatives on SDGs

Bihar is in the process of finalizing the roadmap for SDG implementation.
The state government is already focusing on a number of areas that are covered
under the SDGs including road connectivity and drainage, toilets, clean
drinking water, electricity, higher education, skill development and gender
equality.
Haryana has prepared its Vision 2030 document following extensive

consultations with a range of stakeholders. The strategies outlined in the
document are based broadly on five principles - integrated planning and
decentralized implementation, equitable development, building human
capital, promoting citizen centric services and green growth.
Maharashtra is focused on balanced regional development and emphasizes

sustainable livelihoods, taking initiative to improve management of water,
land and forests, improve access to health and education, and developing
skills for employment generation.
Kerala has set up elaborate indicators and standards for achieving the SDG
3 on health. The state has sector specific plans for 2030 with emphasis on
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encouraging entrepreneurship in production sectors, developing the key bases Focus Area Alignment
of knowledge economy in the areas of education, Science and Technology
etc., and ensuring environmental and social sustainability.
Karnataka focuses on technology in 12 sectors: education, medical science

and health care, food and agriculture, water, energy, environment, habitat,
transportation, infrastructure, manufacturing, materials and ICT.
Tamil Nadu focuses on infrastructure development in six major sectors:

energy, transportation, industrial and commercial infrastructure, urban
infrastructure and services, agriculture and human development.
Punjab has set up a SDGs Support Unit under the Planning and Development
Department. The SDGs Support Unit serves as a conduit for technical support
at the state level and acts as a nudge unit for providing evidence, analysis
and perspectives to inform public policy in the context of SDGs.
Madhya Pradesh has also established an SDG cell. The Madhya Pradesh
State Planning Commission has also established Planning and Policy Support
Unit, Project Monitoring Unit, Knowledge Management Unit and
International Division, in order to meet challenges of perspective planning
and SDGs.
Source: Voluntary National Review Report, Niti Aayog, 2017
Activity 1
Conduct a survey in all the departments of a company and explain briefly

about various national priorities and commitments. Ask them to explain what
they think, how their business can contribute towards one or more national
commitments and plans? Note down their suggestions.
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1) What are the different action plans under National Action Plan on Climate
Change (NAPCC)?
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257
CSR for Sustainable 2) What are the state level initiatives for SDGs taken up by Punjab?
Development
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3.3 GLOBAL IMPERATIVES FROM SUSTAINBLE

DEVELOPMENT POINT OF VIEW
We have several imperatives at global level as well, aiming broadly towards
sustainable development. But two major global commitments which hold special
importance in current scenario are Sustainable Development Goals (SDGs) and
Outcomes of Paris Climate Summit and COPs, to which India is signatory.
3.3.1 Sustainable Development Goals (SDGs)

The Sustainable Development Goals (SDGs) are undoubtedly the most important
commitment in today’s era and one of the significant imperatives made in last
few decades, which define global sustainable development priorities. With a total
of 17 goals aiming at 169 targets, SDGs are set to be achieved by 2030. It provides
a clear road map to achieve optimum growth and holistic development of the
society and planet, addressing a wide range of issues and interconnected factors.
A comprehensive overview of all 17 goals with its specific targets is summarized
in the Unit-1. Realizing the significance of SDGs, the Central Government has
aligned national development agenda with SDGs and instructed sub-national
governments, nodal ministries and respective state departments to map their
programmes and initiatives with SDGs, defining specific, yet vital role for
everyone to play. So, aligning business strategies with SDGs will not only provide
scope for manifesting opportunities for local cohesive development, but also
help companies/corporates to connect with global priorities and meet the country
commitments on SDGs, which in turn will give your organization a competitive
edge over others.
3.3.2 Outcomes of Paris Climate Summit and Conference of

Parties (COPs)
Climate change is one of the biggest challenges facing the world today. It
is responsible for increase in the extreme weather events and a series of
environmental concerns. In 2015, some 195 Parties of UNFCCC met at COP 21,
also known as the 21st Conference of the Parties to UNFCCC, under the Paris
Agreement, to transform their developmental initiatives into a strategic course
of action towards sustainable development. It was convened with an overall aim to
limit global warming to 1.5-2 degrees Celsius above pre-industrial levels. Through
the Paris Agreement, the Parties agreed to a long-term goal for adaptation – to
increase the ability to adapt to the adverse impacts of climate change and foster
climate resilience and low greenhouse gas emissions. Additionally, they agreed
to work towards making finance flow consistent with a pathway towards low
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greenhouse gas emissions and climate-resilient development. Subsequently, COP Implementation Plan and
22 was held in Bab Ighli, Marrakech, Morocco and COP 23 in Bonn,
Germany. Each COP meeting allows member countries to take stock of the
adequacy of current and projected actions as well as identify opportunities to
enhance climate ambition and action. Outcomes of COP meeting each year
generate a road map towards achieving the goals of the Agreement and combat
global warming (Gray, 2016). As the agreement reaffirms the goal of keeping
average warming below 2 degrees Celsius, if possible 1.5 degrees while urging
the countries to pursue efforts to limit highly vulnerable climate impacts, any
business activity (including CSR) aligning with this objective will therefore
definitely add value to the efforts that India is putting up to achieve its Paris
agreement goal.
3.3.3 Global Principles and Charters

A comprehensive guidance for companies related to CSR and sustainability or
business responsibility is also available in the form of many globally recognized
guidelines, frameworks, principles and charters. These concepts are closely
aligned globally with the notion of CSR (CII-PwC handbook, 2013). A few key
global principles, guidelines and charters of universal importance are:
ICC Business Charter for Sustainable Development
Earth Charter
United Nations Global Compact (UNGC)
ILO’s Tripartite Declaration of Principles on Multinational Enterprises and
Social Policy
OECD CSR policy tool
AccountAbility’s AA1000 series of standards
Social Accountability International (SAI): SA 8000 Standard
ISO 26000: Social responsibility
But the most important and noteworthy among these is UN Global Compact
(UNGC).
3.3.4 UN Global Compact (UNGC)

United Nations Global Compact (UNGC) is the world’s largest corporate
citizenship initiative. As the name suggests, it is a United Nations initiative and
principle-based framework to encourage businesses worldwide to adopt
sustainable and socially responsible policies and to report on their implementation.
It asks companies to take business responsibly to solve societal challenges through
business innovation and collaboration initiatives– which are important from both
CSR and SDGs point of view. It has 10 principles covering four broad areas:
Human rights (support and respect the protection of international human

rights and ensure that business is not complicit with human rights abuses)
Labour rights (uphold the freedom of association and effective recognition

of the right to collective bargaining, elimination of all forms of forced and
compulsory labour, effective abolition of child labour and elimination of
description in respect of employment and occupation)
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CSR for Sustainable Environment (support a precautionary approach to environmental
Development
challenges, undertake initiatives to promote greater environmental
responsibility and encourage the development of environmentally friendly
technology)
Governance (work against corruption in all forms, including bribery and

extortion)
UNGC catalyses actions in support of broader goals including SDGs. Adoption

of UNGC and aligning it with business strategies will move the company closer
towards overall sustainable development.
3.3.5 Sustainability Reporting

Sustainability Reporting is the practice of measuring, disclosing organizational
performance against specific environmental, social and governance goals and
metrics that support sustainable development. It describes how sustainability is
incorporated into the company’s overall strategies and policies. Sustainability
Reporting builds trust, improves reputation, stimulates organizational
development, drives better performance, supports sustainable decision making
and attracts more investment. The SDG target 12.6 (Part of Goal 12) requires
governments everywhere to encourage companies, especially large and
transnational companies, to adopt sustainable practices and to integrate
sustainability information into their reporting cycle. It is important for the
companies to use internationally recognized standards for sustainability reporting
such as the comprehensive standards offered by GRI or reporting mechanisms
like CDP, UNGP Reporting Framework and the CDSB Framework (GRI-UNGC
report, 2015; KPMG, 2017). The SDG Compass website (www.sdgcompass.org)
gives a comprehensive overview about different standards and reporting
frameworks.
3.4 IDENTIFYING COMMONALITIES

BETWEEN CSR FOCUS AREAS AND OTHER
NATIONAL/GLOBAL PRIORITIES
It is quite evident that at the moment, we have a large number of global as well
as national imperatives in the field of sustainable development. So while
strategizing your CSR project when you have to choose the priorities for alignment
of your CSR activities, you may be in a confused state of mind with so many
obvious queries/questions such as –”what would be the right choice for your
company? Which one would be the perfect choice or combination of national/
global imperatives from your business point of view? What would be the most
suitable one?” To get the proper answer, you have to closely observe each national
and global priority and when you do so, you will find out that there are many
commonalities that exist between various imperatives and the basic objectives
of all these commitments are more or less similar.
3.4.1 What are the common focus areas under CSR and SDGs?
Both SDGs and CSR have many things in common and they have tremendous
potential to develop a cohesive sustainable growth model. The thematic areas of
SDGS and CSR share a lot of overlap in terms of their broad focus, objectives,
260
targets, activities that are needed to achieve them. If you select one thematic area Implementation Plan and
under Schedule VII for CSR, then it will automatically help you to achieve one
or more objectives of SDGs. Example: When a company picks up rural
development as a focus area (as listed under Schedule VII), depending on the
nature of intervention, it can link it to multiple SDGs like ending poverty, building
resilient infrastructure, promoting sustainable industrialization, sustainable use
of ecosystems etc. Similarly, choosing a CSR activity under education helps the
company to deliver towards the direct objective of Goal 4 of SDGs, which in
turn will contribute towards advancement of goal 1and 8 as well. Table 1 gives
brief illustration of the connective link between SDGs and CSR Schedule VII
activities of the Act.
Table 1: Connection between SDGs and Schedule VII CSR activities
S. NO. SDGs Activities as per Schedule VII
1) 1, 2, 3, 6 Eradicating hunger, poverty and malnutrition,

promoting preventive health care and
sanitation and making available safe drinking
water
2) 4, 8, 5, 10, 11 Promoting education, including special

education and employment enhancing vocation
skills especially among children, women,
elderly, and the differently abled and livelihood
enhancement projects
3) 5, 10 Promoting gender equality, empowering

women and orphans; setting up old age homes,
day care centres and such other facilities for
senior citizens and measures for reducing
inequalities faced by socially and economically
backward groups
4) 7, 13, 14, 15 Ensuring environmental sustainability,

ecological balance, protection of flora and
fauna, animal welfare, agroforestry,
conservation of natural resources and
maintaining quality of soil, air and water
5) 11, 4 Protection of national heritage, art and culture

including restoration of buildings and sites of
historical importance and works of art; setting
up public libraries; promotion and
development of traditional arts and handicrafts
6) 5, 10, 16 Measures for the benefit of armed forces

veterans, war widows and their dependents
7) 10 Training to promote rural sports, nationally

recognized sports, Paralympic sports and
Olympic sports
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CSR for Sustainable
Development 8) All SDGs Contribution to the Prime Minister’s National
addressed broadly Relief Fund or any other fund set up by the
Central Government for socio-economic
development and relief and welfare of the
Scheduled Castes, the Scheduled Tribes, other
backward classes, minorities and women
9) 4, 9 Contributions or funds provided to technology

incubators located within academic institutions
which are approved by the Central Government
10) 1, 2, 3, 4, 5, 10, Rural Development Projects

15, 17
In nutshell, if you want to maximize your company’s contribution to sustainable

development, SDGs give you that opportunity, including the targets and objectives
to dwell upon with measurable outcomes while CSR will give you methodological
approach, tool and strategic direction to achieve that desired goal. So, CSR can
be used as a catalyst for achieving SDGs.
Activity 2
Conduct a survey in all the departments of a company. Ask them to explain,

how their business can align Schedule VII thematic areas with SDGs focus
areas and plan their CSR activities? Write their suggestions.
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3.4.2 What are the common focus areas under SDGs and other
sustainable development (SD) initiatives and what are the
opportunities they offer for effective corporate planning?
Not only CSR-Schedule VII guidelines, several other policy and schemes of the
central government, various government level interventions, state and national
level plans and programmes also have many commonalities and a shared focus.
The following box provides details about various schemes, plans, programmes;
initiatives initiated at government level in line with SDGs and suggested broad
action that corporates can take (Box 2).
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Box 2: Various government schemes aligned with SDGs and potential Focus Area Alignment
areas of interventions for private sector
Goal Government intervention and Private sector
centrally sponsored scheme intervention
1. No Poverty National Urban livelihood Generate livelihood

Mission opportunities
National Rural Employment Equal pay and safe
Guarantee Scheme working conditions
National Rural Livelihood No slaver/bonded
Mission (NRLM) labour in the supply
National Social Assistance chain
Programme
Digital India Land Records
Modernization programme
Pradhan Mantri Jan Dhan
Yojana
Pradhan Mantri Jeevan Jyoti
Bima Yojana
2. Zero Hunger National Food Security Reduce food waste or

Mission food loss
Mission for Integrated Awareness on
Development of Horticulture sustainable food
National Mission for consumption
Sustainable Agriculture Knowledge sharing
National Mission on and capacity building
Oilseeds and Oil Palm on sustainable
National Mission on agriculture, genetic
Agriculture Extension and diversity
Technology
Rashtriya Krishi Vikas
Yojana
National Livestock Mission
Livestock Health and
Disease Control
National Programme for
Bovine Breeding and Dairy
Development
Targeted Pubic Distribution
System (TPDS)
National Nutrition Mission
(NNM)
National Food Security Act
(NFSA), 2013
Mid-day Meal Scheme
3. Good Health National Health Mission Support effective and

and Well Being including NRHM inclusive national
National Mission on Ayush health system
including Mission on Provide affordable
Medicinal Plants and accessible
National AIDS & STD healthcare options to
Control Programme communities
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CSR for Sustainable
Development Integrated Child
Development Service
(ICDS)
Pradhan Mantri Swasthya
Suraksha Yojana
4. Quality Sarva Shiksha Abhiyan Vocational and

Education National Programme on Technical Training
Nutritional Support to Programme
Primary Education Support access to
Support for Educational childcare for
Development including employees with
Teachers Training &Adult children by providing
Education on-site day-care
Padhe Bharat Badhe Bharat including childcare and
Scheme for Providing back up care spaces or
Education to Madrasas, services, financial
Minorities and Disabled assistance for childcare
Scheme for Infrastructure and flexible work
Development in Minority options
Institutes
Rashtriya Uchhtar Shiksha
Abhiyan
Umbrella Scheme for
Education of ST Students
5. Gender Equality National Mission for Embed principles of

Empowerment of Women gender equality in
including Indira Gandhi policies and processes
Mattritav Sahyog Yojana Promote local women
Rajiv Gandhi Scheme for entrepreneurs as
Empowerment of preferred suppliers
Adolescent Girls (SABLA)
Beti Bachao Beti Padhao
Sukanya Samridhi Yojana
Support to Training and
Employment Programme for
Women (STEP) 2014
SWADHAR 2011 (A
Scheme for women in
difficult circumstances)
Kasturba Gandhi Balika
Vidyalay (KGBV)
6. Clean Water and National Rural Drinking Develop innovative
Sanitation Water Programme technology, new
Nirmal Bharat Abhiyan products for safe
Pradhan Mantri Krishi drinking water and
Sinchayee Yojana sanitation
National River Conservation Understanding the
Programme (NRCP) impacts of water use in
National Ganga- Integrated the clue chain and
Ganga Conservation water mapping
Mission Construction of water
Inter-linking of rivers shed/ rain water
harvesting units in
communities
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Leveraging the Focus Area Alignment
business position to
ensure water access for
workers in the
workplace across
supply chains
7. Affordable Deen Dayal Upadhyaya Gram Investing in

and Clean Jyoti Yojana sustainable energy
Energy National Solar Mission – solutions
Providing continuous power Working with suppliers
supply to rural India to procure clean energy
Power electrification of the and to increase their
remaining 20000 villages share of renewable
including off grid solar power energy
by 2020 Setting an internal
Five new ultra-mega power price on carbon to
projects each of 4000 MW to redirect investments
be installed towards renewable
National Policy on Bio-fuels energy sources and
National Clean India Fund technologies
National Clean Energy Fund
RE INVEST 2015
Soil Health Card Scheme
8. Decent Work National Service Scheme Frame policies for fair

and (NSS) selection of suppliers
Economic Skill Development Mission and improving
Growth Social Security for economic inclusion
Unorganized Workers throughout the supply
including Rashtriya Swastya chain
Bima Yojana Building screening
Deendayal Upadhyaya mechanisms and
Antyodaya Yojana ensuring consistent
National Urban Development practices in own
Mission supply chains
Making financial
advice available to
employees in the
workplace or providing
guidance on where to
go for such services
focussing on
marginalised groups
9. Industry Border Area Development Resource efficiency,

Innovation Programme (BADP) (ACA) sustainability and
and National Handloom resilience throughout
Infrastructure Development Programme the supply chain and
Catalytic Development business model
Programme under Sericulture Performing social,
Pradhan Mantri Gram Sadak economic and
Yojana environmental impact
Pt. Deendayal Upadhyaya assessments across the
Shramev Jayate Karyakram whole lifecycle of own
products and services
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CSR for Sustainable
Development Minimum Government
Maximum Governance
Make in India
Start Up India
Ease of doing business initiative
FDI Policy
10. Reduced Multi Sectoral Development Framing a fair wage

Inequalities Programme for Minorities policy ensuring equal
Backward Regions Grant Fund remuneration for men
(District Component) (ACA) and women workers
Scheme of Assistance to for work of equal value
Scheduled Casts Development Collaborating with
Corporations MSMEs including
Grants from central pool of those run by women, in
resources for North Eastern their value chains to
Region and Sikkim help them meet
Udaan scheme for youth of regulations stakeholder
Jammu & Kashmir expectations, market
PAHAL – Direct Benefits requirements and
Transfer for LPF (DBTL) business’ internal
consumers scheme sustainable goals
Give it Up campaign
Mudra Yojana
11. Sustainable Rajiv Awas Yojana Developing a disaster

Cities and Indira Awas Yojana risk management plan
Communities Pradhan Mantri Adarsh Gram for business models
Yojana (PMAGY) and supply chains
National Programme for Persons Developing a safe and
with Disabilities low carbon
Jawaharlal Nehru National transportation policy
Urban Renewal Mission for employees, supply
Smart Cities Mission chain operations and
Pradhan Mantri Awas Yojana other services
Atal Mission for Rejuvenation
and Urban Transformation
Heritage City Development and
Augmentation Yojana
12. Responsible The National Policy on Biofuels Conducting awareness

Consumption The National Clean Energy Fund drives to promote
and consumer awareness
Production and to engage the
consumers in
sustainable
development
Developing circular
models for products
focussing on use of
renewable energy
13. Climate National Action Plan on Climate Disclosing GHG

Action Change emission data and
National Mission for a Green material climate risk
India information through
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National Solar Mission adequate disclosure Focus Area Alignment
National Mission for Enhanced initiatives
Energy Efficiency Investing in early
National Mission for Sustainable warning technologies
Habitat and systems and
National Water Mission building a response
National Mission for Sustaining network of
the Himalayan Ecosystem stakeholders and
National Mission for Sustainable communities on
Agriculture climate and natural
National Mission on Strategic disaster related impact
Knowledge on Climate Change
14. Life Below Conservation of Natural Understanding waste

Water Resources and Ecosystems generated due to the
National Plan for Conservation use of products and
of Aquatic Eco-System services introducing
Sagarmala Project practices focussing on
including waste
collection, reuse and
recycling
Obtaining aquaculture
certifications for
marine animal health
and welfare, food
safety and
environmental
protection or ensuring
that suppliers obtain
such certifications
15. Life on Land National Afforestation Obtain forest

Programme management
Integrated Development of Wild certifications and
Life Habitats certifications on forest
Project Tiger products
Project Elephant Assessing soil and land
National Environmental Policy degradation risk to
2006 prevent soil
National Agroforestry Policy contamination from all
2014 sources
National Action Programme to
Combat Desertification 2001
16. Peace, Justice Panchayat Yuva Krida Aur Khel Implementing due
and Strong Abhiyan (PYKKA) diligence tools
Institutions Development of infrastructure including risk
facilities for judiciary including identification, impact
Gram Nyayalayas assessments,
Integrated Child Protection management and
Scheme mitigation measures,
Digital India reporting, grievance
Pragati Platform (Public mechanisms and other
grievance redressal system) stakeholder
RTI (Right to Information Act) engagement processes
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CSR for Sustainable
Development Raise awareness of the
relevant laws, codes
and regulations among
employees
17. Partnership Support for statistical Demonstrating a Zero

for the Goals strengthening tolerance approach to
South South Cooperation corruption and bribery
India Africa Summit at top management and
SCO (Shanghai Cooperation leadership levels.
Organisation) BRICS Helping local
NDB (New Development Bank businesses and
– BRICS) integrating them into
SAARC Satellite (South Asian global value chains
Association for Regional
Cooperation)
Source: KPMG report, 2017
Activity 3
Conduct a survey in the CSR department of a complying company. Ask them

to explain, which government plans and programmes would be suitable for
alignment with SDGs for their company? Write down their suggestions and
make a list of CSR activities from your business point of view, aligning SDGs
and identified government plans and programmes.
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3.5 ALIGNMENT OF CORPORATE STRATEGY

WITH CSR-SDGS-SD INITIATIVES
3.5.1 Common Focus Areas and Implementation Plan
Development
Table 1 gives you details about the common focus areas between CSR and SDGs.
Similarly, Box 2 gives you an idea about various government plans and
programmes at the national/regional level and also a brief about the suggested
activities on similar lines of these initiatives. Mapping of these two distinct areas
explained in two boxes (common focus areas under CSR and SDGs and SDGs
and other SD initiatives) and narrowing down to single focus and aligning it
268
further with corporate strategy, a broader and open outlook along with considered Implementation Plan and
view is suggested to be adopted. Example: if you choose SDG 6 which focuses
on clean water and sanitation and has a connection with Central Government
schemes such as National Rural Drinking Water Programme, Nirmal Bharat
Abhiyan, National River Conservation Programme, Namami Ganga Mission,
etc, then you can select “Promotion of clean water and sanitation” as your CSR
activity to align with your business stategies. In this way you can align your
business focus with those of CSR-SDGs-SD initiatives all together, which will
significantly add value to your company repute.
Implementation of this alignment process is not that easy and cannot be made
possible with the help of a single actor or sector; it needs a high level collaboration
between the government, private sector, civil society, research and academic
institutions and should be strongly supported by apt policy regime, stategic
interventions, supportive institutional mechanism, determined and skilled
individuals, disaggregated databack up and reporting system. National and
multinational companies and big corporates can contribute towards this by
utilising not just their capital, but also their reach, resources, technology, research,
expertise and creative innovation. Since businesses have the adaptability and
agility to quickly respond and implement solutions with localised interventions,
they can effectively play the role as a catalyst and also as a facilitator in this
implementation process. They can bring a fresh perspective to the path set for
SDGs by breaking down the long route of 2030 and may design a road map for
several smaller achievable milestones (SDSN, 2015; KPMG, 2017). They should
develop policies, practices and frameworks that can contribute efficiently to the
sustainble development agenda, keeping all the interconnectedness in view.
1) What is Sustainability Reporting?
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2) Name some of the government schemes related to Goal 1 (No Poverty).

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CSR for Sustainable
Development
3.6 LET US SUM UP
We started this unit with an aim to understand various national and global priorities
and commitments from sustainable development point of view and the
commonalities that exist between them so that an effective implementation plan
can be developed for business sector aligning their corporate strategies with CSR-
SDGs-SD focus areas.
National imperatives refer to the initiatives, plans, programmes and commitments

made or have to be made based on the national priorities, in order to achieve
sustainable development. These are the key strategic means of advancing national
obligation towards global sustainable development commitments. Some of the
top national initiatives in today’s time are - Schedule VII of Companies Act,
Nationally Determined Contributions (NDCs), National Action Plan on Climate
Change (NAPCC), National Mission on Himalayan Studies (NMHS), National
Guidelines on the Economic, Social and Environmental Responsibilities of
Business, SEBI-Business Responsible Reporting (SEBI-BRR) and DPE CSR
and sustainability guidelines.
Two key global commitments which hold special importance in current scenario
are Sustainable Development Goals (SDGs) and Outcomes of Paris climate
summit and subsequent COPs, to which India is signatory.
Though there are a large number of global as well as national imperatives in the
field of sustainable development, the basic objectives of all these commitments
are more or less similar. All the national and global imperatives including CSR
and SDGs, many things are in common and have a shared thematic focus. They
hold tremendous potential to develop a cohesive sustainable growth model.
The implementation of the alignment process of corporate startegy with CSR-

SDGs-SD focus areas is not that easy and needs a multistakeholder collaboration
involving government, private sector, civil society, research and academic
institutions. It should be strongly supported by apt policy regime, stategic
interventions,supportive institutional mechanism, determined and skilled
individuals, disaggregated data back up and reporting system.
With the apt adaptability and agility to quickly respond and implement solutions
with localised interventions, businesse should play the role as a catalyst and also
as a facilitator in the implementation process and suitably develop policies,
practices and frameworks that can contribute efficiently to the sustainble
development agenda.
3.7 KEYWORDS
Imperatives: Essentials or priority areas/factors
Synergy: Synergy is the concept that allows two or more organizations,
substances, or themes to combine together.
Convergence: The act of merging and moving towards union or uniformity.
Statutory Provisions: It refer to the parts of the law; something which is in
a statute - in a law, passed by a competent legislative body (state or federal
270 legislature generally).
Technology Intervention: Technology-based strategies/modalities with digital Implementation Plan and
interference.
Inclusive Growth: Inclusive growth means economic growth that provides

access to essential services, equality of opportunity to all and empowers people
through creation of basic amenities.
Equitable Development: This refers to the creation of opportunities for healthy

vibrant communities so that the poor and local communities benefit from
decisions, activities and systems that affect their neighbourhoods and surrounding
factors.
Adaptation: A response/adjustment that societies or ecosystems make to reduce

the vulnerability of something and taking appropriate action to prevent or
minimise the damage it may cause in due course of time.

CII and PwC (2013). Handbook on Corporate Social Responsibility in India.
CII& PwC handbook.
DPE (2014). Guidelines on Corporate Social Responsibility and Sustainability

For Central Public Sector Enterprises. Retrieved October 3, 2018
from https://dpe.gov.in/sites/default/files/Guidelines_on_CSR_SUS_2014.pdf
MCA, (2018). Draft National Guidelines on the Economic, Social and

Environmental Responsibilities of Business (2018), Retrieved October 3, 2018
from http://www.mca.gov.in/Ministry/pdf/
DraftNationalGuidelines2018_20062018.pdf
Grey, A. (2016). What is the Paris Agreement on climate change? World Economic
Forum, September 7, 2016 Retrieved October 3, 2018 https://www.weforum.org/
agenda/2016/09/what-is-the-paris-agreement-on-climate-change/
Government of India, (2014). Background Note on Corporate Social

Responsibility. Ministry of Corporate Affairs, Government of India.
Government of India (2018). National Action Plan on Climate Change. Prime

Minister’s Council on Climate Change, Government of India. Retrieved October
3, 2018 from http://www.moef.nic.in/downloads/home/Pg01-52.pdf
Government of India (2016). National Mission on Himalayan Studies(NMHS).

Mission Document. Retrieved October 3, 2018 from http://nmhs.org.in/pdf/
National%2Mission0%20on%20 Himalayan%20Studies.pdf
WBCSD, (2015). The SDG Compass - The guide for business action on the
SDGs. UN and GRI report.
Hare, B., Ancygier, A., De Marez, L., and Parra, P.Y. (2017). Facilitating Global
Transition: The Role of Nationally Determined Contributions in Meeting the
Long-Term Temperature Goal of the Paris Agreement. Expert Perspectives for
the NDC partnership. Climate Analytics, April 2017
271
CSR for Sustainable KPMG, (2017). Sustainable development Goals (SDGs): Leveraging CSR to
Development
Summit, 2017
ToI, (2017). Sebi asks top 500 listed companies to adopt integrated reporting.
The Times of India. February, 2017. Retrieved October 3, 2018 from https://
timesofindia.indiatimes.com/business/india-business/sebi-asks-top-500-listed-
cos-to-adopt-integrated-reporting/articleshow/57003235.cms
SEBI (2015). Format for Business Responsibility Report (BRR).Retrieved October

3, 2018 from https://www.sebi.gov.in/legal/circulars/nov-2015/format-for-
business-responsibility-report-brr-_30954.html
Special Correspondent (2017). Climate change plan to get new missions. The
Hindu, January 25th, 2017
United Nations Climate Change Secretariat (2017). Catalysing the Implementation

of Nationally Determined Contributions in the Context of the 2030 Agenda
through South-South Cooperation. United Nations Climate Partnerships for the
Global South.


ANSWERS
Answer 1. National Action Plan on Climate Change (NAPCC) is a
comprehensive action plan which outlines measures on climate change
related adaptation and mitigation by India. These include: National Solar
Mission, National Mission for Enhanced Energy Efficiency, National
Mission on Sustainable Habitat, National Water Mission, National Mission
for Sustaining the Himalayan Ecosystem, National Mission for a Green
India, National Mission for Sustainable Agriculture, National Mission on
Strategic Knowledge for Climate Change
Answer 2. Punjab has set up a SDGs Support Unit under the Planning and
Development Department. The SDGs Support Unit serves as a conduit for
technical support at the state level and acts as a nudge unit for providing
evidence, analysis and perspectives to inform public policy in the context
of SDGs.
Answer 1. Sustainability reporting is the practice of measuring, disclosing
organizational performance against specific environmental, social and
governance goals and metrics that support sustainable development. It
describes how sustainability is incorporated into the company’s overall
strategies and policies. Sustainability reporting builds trust, improves
272
reputation, stimulates organizational development, drives better Implementation Plan and
performance, supports sustainable decision making and attracts more
investment.
Answer 2. Some of the government schemes related to Goal 1 (No Poverty)
are:
National Urban Livelihood Mission
National Rural Employment Guarantee Scheme
National Rural Livelihood Mission (NRLM)
National Social Assistance Programme
Digital India Land Records Modernization programme
Pradhan Mantri Jan Dhan Yojana
Pradhan Mantri Jeevan Jyoti Bima Yojana
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CSR for Sustainable
Development UNIT 4 COLLECTIVE ACTION AND
COLLABORATION
Structure
4.1 Introduction
4.2 Goal 17, Partnership and Collaboration
4.3 Co-operation and Collaboration Towards Implementation
4.4 Way Forward Action
4.5 Let Us Sum Up
4.6 Keywords
4.1 INTRODUCTION
Collective action and collaboration is necessary for unlocking the potential of
cooperation of the collaborating institutions for achieving Sustainable
Development Goals (SDGs). There are immense opportunities viz: technological,
investment and financial cooperation. Identification of the priority areas would
be the first step for the collaborating institutions to proceed with. The roles and
responsibilities and the innovative means of funds utilization for speedy
operationalization of projects would be the next step. Here mapping the areas of
cooperation, modalities of collaboration, potential of establishing networks and
outlines of institutional arrangements are equally important. It is necessary to
understand that the successful achievement of SDGs wouldn’t be limited only to
the government but would require civil society, corporates, academic and research
organizations to play an important role for the same. With the premise as above,
the details in this unit would be covered broadly providing good understanding
and way forward action in this direction.
Explain collective action and collaboration
Discuss the difference between partnership and collaboration
Explain needs for academia-industry-specialized agencies cooperation and
collaboration towards implementation
Develop understanding on the roles of academia, industry and specialized
agencies in the achievement of CSR and SDG pursuits
Explain methods, procedures and modalities for cooperation and
collaboration among academia-industry-specialized agencies
4.2 GOAL 17, PARTERSHIP AND

COLLABORATION
Goal 17 focuses on enabling partnerships and collaboration for sustainable
development. It calls for an understanding about the partnership and the
collaboration, summarized as under.
274
4.2.1 What is Partnership? Collective Action and
Collaboration
The partnership brings together more than one group/individuals to address jointly
a task or challenge, of mutual interest and address the situation positively as per
respective strengths. Partnership could be between businesses, civil society
organizations, scientists, academics, local communities, marginalized groups,
multilateral institutions, etc. Partnership can happen between people or countries
or between countries or between sets of people and the basic premise is to share
the expertise, technologies and/or resources. Partnerships help take joint action
in meeting the respective challenges and solving problems together. Partnership
starts with a common shared vision to allow different solutions to different
contexts, bringing in the respective specializations and to find solutions to
common issues of mutual interest.
4.2.2 What is Collaboration?

Collaboration means a process of two or more people or organizations joining
hands to address and accomplish a task and the goal. Collaboration could be
between different working groups to have collective voice on number of issues
based on its complexity. Collaboration is an enabling element and a potential
catalyst to facilitate a system’s change. This is to enhance cooperation in achieving
the plans and targets.
As an example, one of the focus areas is the international trade and equitable
trading system. Another form of collaboration is among the incubators with
focus on social enterprise/social start-ups. An incubator typically mentors a start-
up for six months to three years, providing resources such as dedicated office
space, networking with investors and technical training, among other things. To
tackle community problem through innovation, incubators join hands to achieve
the larger mission of transforming rural India. Multiple social incubators have
their individual strengths but the problem lies in their not joining hands, i.e.,
collaborative efforts to work on a specific or different issue. Collaboration is
similar to cooperation.
4.2.3 What Does Goal 17 Say About Partnership and

Collaboration?
The Goal 17 of SDGs emphasizes on the global partnership and collaboration to
facilitate effective implementation of the SDGs. It seeks to strengthen partnerships
to support and achieve the ambitious targets of the 2030 Agenda, bringing together
national and international governments, community, civil society, private sector,
business entities and other key actors and stakeholders (UN, 2018).
4.3 CO-OPERATION AND COLLABORATION

TOWARDS IMPLEMENTATION
4.3.1 Needs for Academia-Industry-Specialized Agencies
Cooperation and Collaboration Towards Implementation
SDGs are diverse as well as closely interconnected. Since the issues covered
under SDGs are complex, there is need for collective action to meet the common
objective. Therefore, developing relevant strategies and plans for SDGs 275
CSR for Sustainable implementation should be a multi-stakeholder process. Effective multi-
Development
stakeholder engagement involving national and local government representatives,
civil society, businesses and science and technology based institutions would be
key to successful implementation of the 2030 agenda. Cooperation and
collaboration, built on the expertise of individual actors and experience shared
by stakeholders from different sectors will help to develop a collective problem
solving approach and make it simple to carry out various exercises (e.g., planning,
designing, monitoring and evaluation) related to the implementation of the SDG
agenda (SDSN, 2015; United Nations – High Level Political Forum,2017).
Industries with their hands on experience, practical knowledge in thematic areas
and localized intervention can play the roles of facilitators and catalysts for
inclusive growth. Science and technology based academic institutions can provide
necessary technical skill and inputs to accelerate this growth, through capacity
building, skill development and knowledge and technology transfer. Special
agencies across different sectors and from diverse fields have specific role to
play, focusing on wide-range of themes addressed under SDGs. To make this
collaboration function efficiently, roles and responsibilities of all the key actors
and contributions that they can make to the SDG implementation process should
be clearly explained. The increased participation of stakeholders not only
generates practical ideas, but also increases enthusiasm for the programme itself
and thereby contributing significantly towards the success of SDG based
measures.
4.3.2 Interface between academia-industry-specialized agencies

i) Academia and its role in collaboration: Universities, institutions of higher
education, technical institutions with science and technology base can play
a major role in SDG planning and implementation process and therefore,
their association in collaboration is crucial. An institute with a strong
programme on sustainability science would contribute to sustainable
development in many ways. Having an inherent competence with diverse
talent and research support, academic institutions can expand the knowledge,
skill and talent base, develop and incubate new technologies, bring out
new innovations through action research, identify priorities, support strategic
planning, design and guide suitable best practices, process and product
development and help monitor the agenda through analysis and interpretation
of SDG related data. Rather than merely handing over a technology for a
specific purpose, academic participation should be more integral,
contributing to the design-development-production chain of every company.
Academics are key hubs for capacity building, skill development, and
knowledge enhancement. They can provide technical and management
training needed for effective operation, management and execution of work
plan and strategies and can create new generations of sustainable
development leaders. They can play key role in public awareness and
education. They can also provide valuable technical assistance to
governments, various ministries and other specific agencies to design and
support implementation of SDGs.
With the rich expertise and massive knowledge on wide range of themes,
academia can provide support and guidance to many start-ups/incubators/
industry based working groups to deliver on ambitious projects. The
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academic institutions can further supplement their efforts on wide array of Collective Action and
Collaboration
issues to enhance energy efficiency, water conservation, wildlife and
biodiversity conservation, pollution prevention, waste management,
ecosystem protection etc. India has over 100 incubators who are mostly
housed in academia and are mainly funded by government agencies.
ii) Industry and its role in collaboration: Industry is an enabling element

and a potential catalyst to bring out a system’s change, so its collaboration
is vital - both to the specialized agencies such as civil society organizations
and the academic institutions. Through their treasured acumen and massive
experience on markets and their requirements, business sector has a strong
role to play in SDG implementation. Companies/corporates can contribute
towards these goals by utilizing not just their capital, but also their reach,
resources, technology, research, knowledge and innovation. They can bring
in practices, policies and solutions that are designed to contribute to the
sustainable development agenda (KPMG, 2017). They can develop
pragmatic approach in realizing the SDGs, instigate transformational change
in localized economies and implement solutions which can have
sustainability implications. Citing the Article 67 of 2030 agenda, Box 1
further explains the critical role of business sector in SDG implementation
process (UN & GRI, 2015).
Box 1: What does “Transforming our world: The 2030 agenda for
sustainable development” say about the role of business in SDGs
implementation?
Article 67 agreed to by all 193 UN Member States:
‘Private business activity, investment and innovation are major drivers of

productivity, inclusive economic growth and job creation. We acknowledge
the diversity of the private sector, ranging from micro enterprises to
cooperatives to multinationals. We call on all businesses to apply their creativity
and innovation to solving sustainable development challenges. Within the
Global Partnership for Sustainable Development framework, the business sector
ranging from micro-enterprises to cooperatives to multinationals must
contribute to changing unsustainable consumption and production patterns
with investment, innovation, job creation, compliance with international labour
rights, human rights, environmental and health standards.’
Example: Contribution to incubators for the projects aligned towards the mission
of transforming rural India could be one major initiative to achieve SDG
objectives. Successful companies need a healthy society. Any industry/business
that pursues its larger objectives of sustainable development without taking into
view the society in which it operates, would find its success to be temporary. It
will therefore be advantageous to encourage communications between the
industry/companies and technology business incubators along with the
involvement of all concerned including state and local governments and society
to achieve its desired targets, which in turn will contribute towards sustainable
development agenda.
(iii) Specialized agencies and their roles in collaboration: Specialized agencies

particularly esteemed organizations in the area of science and technology; local
authorities including civil society organizations, financial organizations,
277
CSR for Sustainable development partners, business incubators also have specific roles in various
Development
stages of SDG implementation process and thus should play essential functions
in collaboration. To cite an example, Villgro, a DST (Department of Science &
Technology) business incubator with a focus on social enterprises, social issues,
have contributed to solving problems associated with low paid working groups
particularly women, through technology-based solutions to bring out a definite
social change. Similarly, there are many other incubators who along with industry
partners and the institutions, have developed solutions which are technology
based in order to bring about social change in the identified groups/areas. There
are multiple social incubators, contributing to many social changes positively.
Each organization has its own unique strengths but the general problem is that
they are not joining hands. Earnestly developing collaborative associations among
these agencies would not only be advantageous but are also the need of the day.
Box 2 gives us idea about specific stakeholder groups that can play important
roles in SDG implementation within urban and rural setups and thus, should be
part of the collaborative effort towards SDGs implementation.
Box 2: Stakeholder Groups
Category Examples
National governments Professional staff within ministries;

representatives from governments and
municipalities
Civil society organizations Nongovernmental organizations, volunteer

organizations, indigenous peoples’ organizations,
faith-based organizations, social movements, and
community-based organizations
Businesses Business leaders, chambers of commerce and

industry, cooperatives and unions, economic
development corporations, and manufacturers
Academic institutions National SDSNs, universities, technical

institutions, research centres, national academies,
and schools of urban planning, social sciences,
and public policy
Development partners Bilateral and multilateral donors, UN agencies,

regional development and central banks, and
international institutions such as the World Bank
and IMF
Sub-national governments State/provincial governments or other forms of

regional government are often responsible for
urban and local development
Local authorities Local councils and elected representatives, public

utility and service providers, planning bodies
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Collective Action and
Activity 1 Collaboration
Visit a nearby community, conduct a survey. Try to identify who will be the
key stakeholders in local context from SDGs implementation point of view.
Make a list of key stakeholders in local community.
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4.3.3 Methods and Procedures for Academia-Industry-

Specialized Agencies Co-operation and Collaboration
Sustainable development agenda has emerged as one good way to create value
for the collaborating institutions and the society, simultaneously. The collaborating
institutions generally focus on the key areas of impact for their respective
institutions and the society. They also develop creative solutions that draw on
the complimentary capabilities of both, to address major sustainability risks and
the challenges that affect each other.
Three principles for moving ahead with collaboration could be:
A) Concentrate on your CSR Pursuits

As explained earlier, this would be more useful if it is linked to sustainability
risks and challenges, the identified focus areas by the organization, specific need
of the society in that particular geographic location and above all, the envisaged
greater impact of the pursuits/ interventions including linking to SDGs.
There are specific areas/issues where implementation is a challenge and call for
co-operation and collaboration. That there is a need for the collaboration between
academic – Industry – specialized agencies for the projects and its implementation
is well known, the following example of involvement and contribution to mitigate
the sustainability risk on climate change perspective, will explain the extent:
a) Climate Change
India is a signatory to the International protocol and has voluntarily reduction
commitment in the following 3 areas:
i) To reduce emission intensity of the country’s GDP by 30-35 per cent
by 2030 from 2005 levels.
ii) To achieve 40 per cent power generation from renewable sources of
energy, for example solar, wind, biomass, hydro and nuclear.
iii) To Create an additional carbon sink of 2.5 – 3.0 billion tonnes of CO2
through afforestation and tree coverage.
India’s climate plan for 2030, detailed as above, is for the planet’s good, for
people’s health and living conditions, by using such interventions that are science
and technology based. In addition to the above, adaptation to climate change by
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CSR for Sustainable enhancing investments in the sectors which are particularly vulnerable to the
Development
climate change such as agriculture, water resources, Himalayan regions, coastal
regions, health and disaster management etc.
India, as a developing nation, an emerging economy, is trying to obtain and

mobilize international funds from developed countries for the mitigation and
adaptation actions, the role of national institutions to contribute to the actions
are equally important to this end.
India needs to cut emissions gradually with suitable collaborations to achieve

some benefits, for the projects/areas, some of them are as under.
b) Agriculture and Water Crisis

This subject will further clarify why multiple partnerships and collaborations
are necessary in the area of agriculture particularly as water is a major input for
all agricultural activities. India being water scarce, the water issues pose
sustainability risks, to people, companies and corporate.
India is an agrarian society with over 70 per cent of the people dependent on
agriculture as a major source of their livelihood. Agriculture also consumes over
80 per cent of India’s freshwater resources. With mounting water scarcity,
sustainable solution to water crisis is absolutely unavoidable.
Agriculture requires water, fertilizer, electricity, cropping pattern, need based

subsidies and also incentives. There is national agenda of doubling farmer income
by 2022. The situation at date is that there is production of water thirsty crops
particularly sugarcane and paddy in the water scarce regions (including
Maharashtra, UP, Punjab, and Haryana).
A report by the National Bank for Agriculture and Rural Development (NABARD)
and the Indian Council for Research on International Economic Relations
(ICRIER) on ‘Water productivity matching of major crops’- holds important
lessons. There is a serious mismatch between water reliant crops and water
abundant areas. Regions with high irrigation availability and water productivity
potential are better suited to water intensive crops, for example: Jharkhand and
Chhattisgarh. But there is insufficient power supply in these areas and therefore
cultivation of water intensive crops is nonremunerative. This calls for R&D,
particularly the multiple resistant, water efficient and high yielding crops. The
Indian Council of Agricultural Research (ICAR) has released a record 313 new
crop varieties during 2016-17 with an emphasis on more farm production and
minimizing use of inputs. More crops per drop is the mantra, i.e., readjusting
cropping pattern and readjusting irrigation patterns is absolutely necessary. Water
saving techniques like alternate wetting and drying method (AWD) is good and
likewise the drip irrigation system which has been legally mandated by the
Government of Maharashtra (Jayachandran, 2018).
Niti Aayog has already brought out a report in a composite Water Management
Index which has clearly brought out the looming threat of India’s water crisis.
About two lakh people die every year due to inadequate access to water
(Jayachandran, 2018). The situation is set to become far more serious and needs
collaborative action for successful solutions.
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c) Waste Management Collective Action and
Collaboration
Waste-to-energy conversion projects, investing in solid waste and waste water
management, pollution prevention, installing the waste minimization measures,
equipment and institutions – all these require participatory approach and
collaborations among social, political and technical spheres. Industry, academia
and specialized agencies like local rural/urban bodies, community based
organizations, NGOs and local/regional/state governments and their allied
departments have a vital role to play to bring out feasible and sustainable solutions
in this area of grave concern.
d) Low carbon economy through sustainable transportation

Strengthening of the public transport system, e.g., MRTS, metro rail and dedicated
transport system like freight corridors, inland water transport, etc., is the need of
the hour and the government is already pushing through a number of schemes
and programmes in the above areas. The participation of corporates/companies
suitably to supplement government efforts would be a positive contribution in
the development process.
e) Afforestation
The Companies Act, 2013 and CSR Schedule-VII have laid emphasis on
environmental initiatives that include afforestation. Thus, it is one of the important
focus areas where companies can contribute effectively and/or supplement the
efforts. Academics specialized in forestry and agriculture science can contribute
significantly towards the research, technology and strategy development in this
area. Specialized departments like government forest department, environment
ministry and associated divisions can play crucial roles in facilitating the dialogue
between local communities and policy and decision-makers and in effectively
implementing the local interventions.
f) Circular Economy
It is important that companies should start investing in ensuring the circulation
of the products they produce either through repurposing the products at the end
of product’s life and/or up-scaling or ensuring the bio-degradation of the products.
The companies must integrate their technological capabilities to see through the
overall sustainability agenda supporting the circular economy. The proposed
actions at the national level to meet India’s voluntary reductions commitment
could include some specific activities as under:
i) Introduce newer technologies and cleaner processes to curb emissions, e.g.,
in thermal power generation
ii) Waste management to curb the emissions there from
iii) Cleaner and efficient transport with focus on future mobility – the emerging
electric vehicles and use of bio fuels
iv) Renewable energy as one of the main sources of power generation
v) Emphasize energy efficiency in the industry as a whole, transportation,
electrical compliances/gadgets
vi) Afforestation, including Green India Mission
vii) Development of cutting edge technologies and to boost R&D efforts.
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CSR for Sustainable The urgent steps that corporate India, along with its other associated partners,
Development
can supplement through multiple initiatives including CSR initiatives in specific
areas, could be:
a) Protection of bio diversity
b) Conservation of Himalayan ecosystem
c) Agriculture
d) Waste management
e) Coastal management and residual resources
f) Disaster management
g) Projects in the area of power generation using renewable resources like
solar, wind, biomass, hydro energy, etc., which would supplement the efforts
to cut carbon footprint.
Considering the above facts, the companies/corporate can join hands and
collaborate in specific regions of the country to contribute effectively to the
sustainable solutions. Collaboration and partnership in any form would go a long
way not only as brand, reputation but a positive contribution to the SDGs.
Activity 4
Arrange a multi-stakeholder meeting in nearby community, gather all the

concerned. Ask them what are the key areas/challenges in local context, which
need collaborative action among industry-academia-specialized agencies?
Write their suggestions.
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Note: a) Write your answer in about 50 words
1) What does Goal 17 say about partnership and collaboration?
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2) How can collaboration between academia, industry and specialized agencies Collective Action and
Collaboration
help in waste management?
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B) Good understanding of the benefits

Selection of identified focus areas and choosing the projects for implementation
besides finding the potential for value creation may not be simple. The key part
is to find symmetry between the two sides (the focus area and value creation)
and to understand issues from the organization’s perspective and societal
perspective. This would entail inter-alia respective sustainability risks, focus
areas and the linkage to SDGs.
The assessment of benefits could be across following three broad dimensions:
i) Time Frame
It is important to be clear on the short-term objectives and the long-term
benefits. In collaborations, timeframe is important as the initiatives proposed
and its implementation could be difficult since it takes considerable time to
realize full potential. Timeframe helps in monitoring the overall
implementation process.
ii) Nature of benefits

Some benefits would be tangible and measurable in numbers while few
could be intangible, which are to be assessed qualitatively. Therefore, it is
advisable to take into view both tangible and intangible benefits.
iii) Benefits accruing to organizations

It is necessary to be clear about the benefits that will accrue to the
collaborating institutions (Keys, et al., 2009) and it should not include the
philanthropy and public relations aspects to avoid real objective and the
intent. It is important to note that the collaboration is primarily to benefit
the society, to mitigate risks and the compliance of law.
C) To find the right collaboration

Collaboration between two or more organization is difficult but when all
collaborating institutions see the win-win potential, there is always motivation
to realize substantial benefits (Keys, et al., 2009). Relationships, particularly the
long term ones which are built on the true strengths of collaborating institutions
will have the greater opportunity of being successful and sustainable. Applying
the above principles for choosing the appropriate CSR projects and opportunities
may have few more questions to be addressed. For example-
283
CSR for Sustainable i) What are the one/two critical areas (sustainable risks and challenges) in
Development
respective businesses which have an interface with each other and also
which has impact on the society?
ii) What are the significant opportunities available to the collaborating

institutions after adjusting their relationships?
iii) What are the long term needs of the society that can be addressed as a result
of above?
iv) What are the kinds of resources and/or capabilities required that can be
mutually offered in realizing the opportunities?
The other challenges and the dimensions would be:
1) Suitable resources, measurement and the accountability standards
Collaboration would certainly be challenging. It requires good planning and hard-
work to assess potential benefits, establish trust, build and manage activities
both internally and externally. It requires long term commitment, good mindset,
commitment associated with measurable action. Further to ensure that the
implementation is successful, it is necessary to have adequate resources,
milestones, measurement and the accountability.
2) Innovation
Innovation is the key to tackle community problems. While it can be a source of
opportunity to the funding agencies, innovation provides a competitive advantage
to the donor agencies as well. Accordingly, the company must integrate its social
responsibility within the core functioning and this would call for suitable
collaboration, as every organization of the company has limited wherewithal to
undertake the same, in totality. As the society progresses, the social indicators
change, people’s aspiration go up. Thus, the company’s impact on the society
also changes along with change in environment. This would require change in
strategy as time goes on.
3) Roles and Responsibility

The collaborating institutions would have the clarity of rules and responsibility
along with timelines and desired outcomes. The role and responsibility of all
collaborating partners should cover both implicit and explicit aspects (Visser,
2007). This would ensure that the implementation of projects is successful and
on schedule. This would help interface between business, society and environment
fully.
4) Reporting Framework
A simple but effective reporting mechanism is required to be put in place for
effective participatory management (Visser, 2007). There are different types of
reports that are generated based on main focus of CSR and sustainability. Some
of the reports are Business Responsibility Report based on NVGs (now VG’s),
Sustainability Report based on Global Reporting Initiative guidelines, CSR report
as per Company’s Act and the Schedule VII of March, 2014. The financial report
is generally the company’s annual report reflecting predominantly the financial
performance, while nonfinancial reports such as BRR, GRI, CSR report focuses
predominantly on the economic, social and environment aspects. Preparation of
284
the reports, collection of related information and reporting framework is well- Collective Action and
Collaboration
defined by the institutions, for example SEBI, MCA, GRI, etc. The collaborating
institutions would jointly consider and develop the reports or cover the project
areas suitably in the report/reported information.
5) Review Mechanism
A joint review mechanism which is mutually agreed to can be put in place. The
review leader mutually (selected) would review and convey the findings to all
the collaborating partners for timely corrective actions as required.
4.4 WAY FORWARD ACTION

Fostering partnership between key stakeholders is the key in achieving SDGs. It
is time, when the government, industry, academia and relevant bodies in India
associate together to strengthen various industry-academia-agencies partnership
models in action. In order to create a productive and positive impact and
accelerating India’s vision to achieve the SDGs, Government should take
appropriate action to introduce suitable policy regulation, incentives and
institutional mechanisms to develop the collaboration among industries,
academics, civil society along with other relevant agencies. In order to promote
systematic and regular access to knowledge and expertise provided by different
stakeholders, Niti Aayog is promoting a national network of resource institutions
called ‘Samavesh’(United Nations – High Level Political Forum, 2017). This is
a welcome step and more such initiatives should be launched for enabling
collaboration among different actors across the sectors.
The business should move beyond mitigation of risks and challenges, and create
value by addressing strategic issues/challenges. This obviously calls for finding
creative solutions to the critical social and businesses challenges. In the long
run, the strategic challenges being faced by the companies would help in building
creative collaboration that accrue significant benefits to both sides. Good
collaboration provides a practical way forward for the management personnel to
assess the true opportunity of CSR to achieve SDGs.
Basically, we need to come up with an arrangement in which the kind of system
established within an educational institution not only generates human resources,
but also creates industry-specific manpower, well equipped with sufficient
understanding of the fundamental issues involved in the diverse spectrum of
sustainability. It will help them appreciate their contributory value and make
them aware about the respective relevance in any vulnerable situation. To achieve
this goal, entrepreneurial science must integrate industrial sustainability and triple
bottomline approaches into its academic function, alongside regular teaching
and research. The thrust needs to be directed at facilitating industrial exploitation
of infrastructure facilities and human resources by establishing effective linkages
with universities, technical organizations, research institutes and national
laboratories; designing curriculum matching up with industrial needs; facilitating
sponsored or joint R&D projects/programmes by industry and academia; and
organizing joint seminars, exhibitions, training and capacity building workshops,
awareness programmes for academicians, industrial personnel and specific
stakeholders from specialized agencies. An active and wider participation from
key stakeholders across the sectors is the need of the hour for generating the
necessary momentum for effective implementation of CSR, sustainability and
sustainable development measures. 285
CSR for Sustainable Check Your Progress-2
Development
1) What are the dimensions to be considered while understanding the benefits
in collaboration?
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2) What should be the review mechanism in collaboration?

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4.5 LET US SUM UP

We started this unit with an aim to understand the link between partnership,
collaboration and the focus of Goal 17 of SDGs. The partnership brings together
more than one group/individual to address jointly a task or challenge, of mutual
interest, contributing to, and address the situation positively as per respective
strengths. Partnership can happen between people or countries or between
countries or between set of people and the basic premise is to share the expertise,
technologies and/or resources.
Collaboration means a process of two or more people, organizations joining hands

to address and accomplish a task and the goal. Collaboration could be between
different working groups to have collective voice on number of issues based on
its complexity.
The Goal 17 of SDGs emphasizes on the global partnership and collaboration,

bringing together national and international governments, community, civil
society, private sector, business entities and other key actors and stakeholders to
facilitate effective implementation of the SDGs.
Developing relevant strategies and plans for SDGs implementation should be a

multi-stakeholder process. Specialized agencies across different sectors and from
diverse fields have specific role to play, focusing on wide-range of themes
addressed under SDGs. To make this collaboration function efficiently, roles
and responsibilities of all the key actors and contributions that they can make to
the SDG implementation process should be clearly explained.
286
With diverse talent and research support, academic institutions can expand the Collective Action and
Collaboration
knowledge, skill and talent base, develop and incubate new technologies, bring
out new innovations through action research, identify priorities, support strategic
planning, design and guide suitable best practices, process and product
development and help to monitor the agenda through analysis and interpretation
of SDG related data. Companies/corporates can contribute towards SDG goals
by utilizing not just their capital, but also their reach, resources, technology,
research, knowledge and innovation. Specialized agencies in the area of science
and technology; local authorities, financial organizations, development partners,
business incubators– all have specific roles in various stages of SDG
implementation process. All these stakeholders can join hands and collaborate
in specific regions of the country to contribute effectively to the sustainable
solutions.
It is the need of the hour -government, industry, academia and relevant bodies in
India should come up with an arrangement to create a productive and positive
impact and accelerate India’s vision to achieve the SDGs.
4.6 KEYWORDS
Equitable –This refers to treating everyone fairly, equally and in the same way.
Multi-stakeholder Process–The process that is used to ensure participation by

taking into consideration, the views of the main actors concerned about a particular
decision are heard and integrated at all stages through dialogue and consensus
building.
Interface –A point where two systems, subjects, organizations meet, interact

and have an influence on each other.
Water Management Index- In order to assess and improve performance for

efficient management of water resources, Niti Aayog had launched Water
management Index as a useful tool. It has ranked all the states against 9 parameters
and 28 indicators.
Up-scaling-The concept of increasing the size, degree and/or magnitude of a

process/product/system to a superior level.

Ehrenfeld, J.R. (1994). Industrial ecology and design for environment: The role
of universities. In D.J. Richards, B.R. Allenby, & R.A. Frosch (Eds.), The greening
of industrial ecosystems: Overview and perspective. (pp. 228–240). Washington,
DC: National Academy Press.
WBCSD, (2015). The SDG Compass - The guide for business action on the
SDGs. UN and GRI report.
Jayachandran, (2018). Using agriculture to tackle the water crisis. Mint, June
29th, 2018.
Keys, T., Malnight, T.W., & Graaf K.V. (2009). Making the Most of Corporate
Social Responsibility. McKinsey & Company.
287
CSR for Sustainable KPMG, (2017). Sustainable development Goals (SDGs): Leveraging CSR to
Development
Summit, 2017
Porter, M.E., and Kramer, M.R. (2006). Strategy and Society – The Link Between
Competitive Advantage and Corporate Social Responsibility. HBR Spotlight.
Harvard Business Review, December.

United Nations (2018). The Sustainable Development Goals Report 2018. United
Nations, New York.
Visser, W. (2007). Corporate sustainability and the Individual: A Literature

Review. University Cambridge Programme for Industry Research Paper Series:
No.1,2007.

ANSWERS
Answer 1. Goal 17 of SDGs emphasizes the need for global partnership and
collaboration to facilitate effective implementation of the SDGs. It seeks to
strengthen partnerships to support and achieve the ambitious targets of the
2030 Agenda, bringing together national and international governments,
community, civil society, private sector, business entities and other key
actors and stakeholders.
Answer 2. Waste-to-energy conversion projects, investing in solid waste and

waste water management, pollution prevention, installing the waste
minimization measures, equipment and institutions – all this requires
participatory approach and collaborations among social, political and
technical spheres. Industry, academia and specialized agencies like local
rural/urban bodies, community-based organizations, NGOs and local/
regional/state governments and their allied departments have a vital role to
play to bring out feasible and sustainable solutions in this area of grave
concern.
Answer 1. The assessment of benefits could be across following three broad
dimensions:
i) Time-Frame
In collaborations, timeframe is important as the initiatives proposed
and its implementation could be difficult since it takes considerable
time to realize full potential.
288
ii) Nature of benefits Collective Action and
Collaboration
Some benefits would be tangible and measurable in numbers while few
could be intangible, which are to be assessed qualitatively.
iii) Benefits accruing to organizations

It is necessary to be clear about the benefits that will accrue to the
collaborating institutions and it should not include the philanthropy
and public relations aspects to avoid real objective and the intent.
Answer 2. A joint review mechanism which is mutually agreed to, can be put
in place. The review leader mutually (selected) would review and convey
the findings to all the collaborating partners for timely corrective actions as
required.
289
MEDS - 052 : CSR PROCESS
(6 Credits)
Block /Unit Title

BLOCK 1 OPERATIONALIZING CSR
Unit 1 Structural and Functional Setup
Unit 2 Business Strategy in CSR
Unit 3 Governance and Corporate Ethics
BLOCK 2 CSR CULTURE AND DIVERSITY
Unit 1 Employer Perspective
Unit 2 Employee Engagement
Unit 3 Entrepreneurship and Welfare
Unit 4 Rehabilitation and Resettlement
BLOCK 3 STAKEHOLDERS’ ENGAGEMENT
Unit 1 Stakeholders
Unit 2 NGOs and Cooperatives
Unit 3 CSR and Government Programmes
Unit 4 Corporate Foundations
Unit 5 Local Bodies
BLOCK 4 CSR FOR SUSTAINABLE DEVELOPMENT
Unit 1 UN SDGs
Unit 2 Selection of Goals and Indicators
Unit 3 Implementation Plan and Focus Area Alignment
Unit 4 Collective Action and Collaboration

Meds-052 CSR Process

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MEDS-052

BLOCK 1 OPERATIONALIZING CSR 5

Format Editing: Content Editing:

Programme Coordinators : Dr. Nisha Varghese <nishavarghese@ignou.ac.in>

BLOCK 1 BLOCK 2 BLOCK 3 BLOCK 4

Structural and Employer Stakeholders UN-SDG

Block 3, Stakeholder Engagement with five units discusses comprehensively

Block 1: Operationalizing CSR consists of three units.

Unit 1: Structural and Functional Setup discusses the structure of CSR

Unit 3: Corporate Governance and Business Ethics discusses the concept of

1.2 POLICY FORMULATION AND

Box 1: List of Responsibilities of the CSR Committee

1.2.1 The Objectives of CSR Policy

Net worth> 500 crores INR

Role of the Board Role of the CSR Committee

Three or more Directors

Approve CSR policy Formulate and recommend a

Disclose reasons for not Monitor the CSR policy

Developing a CSR Operationalizing the

Finalizing the Arrangement

4 Progress Monitoring and Reporting

Report Consolidation and

10 Fig. 1.3: Role of Committee in CSR Processes

CSR is the procedure for assessing an organization’s impact on society and

1.3.1 CSR Trends in India

The policy recognizes that corporate social responsibility is not merely

i) Eradicating hunger, poverty and malnutrition; promoting preventive health

ii) Promoting education, including special education and employment

iii) Promoting gender equality, empowering women, setting up homes and

vi) Ensuring environmental sustainability, ecological balance, protection of

vii) Employment enhancing vocational skills;

viii) Protection of national heritage, art and culture including restoration of

ix) Promotion and development of traditional arts and handicrafts;

Fig. 1.5: CSR Activities at NTPC

2) Describe the composition of the CSR Committee.

1.5 CSR: STRATEGIC PLANNING

1.5.1 Steps in Strategic Planning in CSR

Step I: Developing a CSR Strategy and Policy

Output(s): The CSR Policy document, identification of sectors and issues,

e) Vision and Mission: The CSR thrust is on community development. A

ii) Area of operation: States and districts; underperforming states not a

iv) KPIs (Key Performance Indicators): Global Reporting Initiative’s

v) Determining the implementation mechanism:

vi) Establish methods for monitoring and reporting: CSR project

Example-The Aditya Birla group has a vision “To actively contribute

Aditya Birla CSR Achievements

Step II: The Institutional Mechanism

i) The grants can be made directly by an in-house CSR Department or

ii) Making grants to an independent implementation partner (which has a

c) Activities: For the CSR implementation the company should have an

Step III: Due Diligence of the Implementation Partner

Step IV: Project Development

ii) Conducting a needs assessment (if required) to assess development

iii) Studying and adopting good practices to address similar challenges

iv) Detailing the project: objectives, beneficiaries and impact on the

v) Identifying indicators of success with the means of verification and

vii) Indicating monitoring and evaluation methodologies for impact

Step V: Project Approval

The CSR committee is ultimately responsible for every project. It can,

Output(s): An approved project proposal including a monitoring process

i) It highlights any shortcomings and helps to determine corrective action

ii) It provides an excellent opportunity for learning: what worked and