(CSR, Sustainability, Ethics & Governance) Ananda - 231027 - 085146

CSR, Sustainability, Ethics & Governance
Series Editors: Samuel O. Idowu · René Schmidpeter
Ananda Das Gupta Editor
A Casebook
of Strategic
Corporate Social
Responsibility
Towards Business Sustainability
Series Editors
Samuel O. Idowu, London Metropolitan University, Calcutta House, London, UK
René Schmidpeter, Cologne Business School, Cologne, Germany
In recent years the discussion concerning the relation between business and society
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the interdisciplinary and intercultural discussion on the role of business in society.
The underlying intention of this series is to help solve the world’s most challenging
problems by developing new management concepts that create value for business
and society alike. In order to support those managers, researchers and students who
are pursuing sustainable business approaches for our common future, the series offers
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Ananda Das Gupta
Editor
A Casebook of Strategic
Corporate Social
Responsibility
Towards Business Sustainability
Editor
Ananda Das Gupta
Indian Institute of Plantation Management
Bengaluru, Karnataka, India
ISSN 2196-7075 ISSN 2196-7083 (electronic)

ISBN 978-981-16-5718-4 ISBN 978-981-16-5719-1 (eBook)
https://doi.org/10.1007/978-981-16-5719-1
© Springer Nature Singapore Pte Ltd. 2022

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Foreword
This is going to be a very useful volume. Typically, one thinks of a case book,
as a series of vignettes or stories that illustrate important points about how to or
how not to manage and lead organizations. The cases in this book are different.
They are what we might call “clinical” cases. They combine research-based insights
with the practicality of addressing these insights in real-world circumstances. Such
clinical cases and the methods for constructing them have almost been abandoned
by management theorists in search of ever more quantitative methods. Yet, clinical
cases have historically yielded some of the most important insights about leading
organizations.
The breadth of the situations of the cases in this book is impressive. From trying
to reduce instances of farmer suicide to sustainability, the authors of the cases bring
many theoretical ideas to bear on these difficult issues. The book will repay many
readings, and it will enable much more work that is in line with its main methods
and messages. All the authors are to be congratulated for contributing to this fine
volume.
R. Edward Freeman
University and Olsson Professor
The Darden School
University of Virginia
Charlottesville, USA
v
Contents
Human Values in Corporate Social Responsibility: A Case Study

of India . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Aruna Das Gupta
Corporate Social Responsibility and Sustainability Development
Mapping: Practical Application Beer and Nigel Roome Model . . . . . . . . . 11
Santosh Basavaraj and Sreelakshmi. P
Addressing Social Risks: The Corporate Social Responsibility Way . . . . 39
Shulagna Sarkar, J. Kiranmai, and R. K. Mishra
Can CSR Help Address Farmer Suicides? An Indian Case Study . . . . . . 55
Subhasis Ray
A Delicate Balance for Ruby Cup: Profitability and Sustainability
At the Base of the Pyramid . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 67
Aneel Karnani
TATA Steel India: Corporate Social Responsibility Case Study
Project . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 85
Kamal Singh and Tamanna Girdhar
Jet Airways Insolvency: Was It a Black Swan Event or a Failure
in Strategic Corporate Social Choices? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 105
A. J. Oswald and S. J. Mascarenhas
Human Resource Strategies and Responsible Management: Case
Study of Tea Plantation Workers in Assam . . . . . . . . . . . . . . . . . . . . . . . . . . . 117
Ananda Das Gupta
Swadeshi Mills Limited: Kickstarting Sustainability . . . . . . . . . . . . . . . . . . 143
S. Venkataraman
vii
viii Contents
Corporate Influence and the Role of Corporate Social

Responsibility in Combating Trafficking in Persons—The India
Story . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 155
Nayan Mitra, Khushboo Mehta, and Yumna Khan
Organ Donation as CSR Activity: A Case on an Innovative
Co-Initiative by Mindtree & MOHAN Foundation . . . . . . . . . . . . . . . . . . . . 171
Joy Mukhopadhyay and Arka Ghosh
Editor and Contributors
About the Editor
Dr. Ananda Das Gupta has been engaged in teaching and research for about
thirty years at different universities and institutes across India and is currently the
Head of the Human Resource Development area and Chairperson of the Post Grad-
uate Programme at the Indian Institute of Plantation Management, Bengaluru—an
autonomous institute under the Ministry of Commerce, Government of India. He also
serves as an Adjunct Professor at the Indian Institute of Management, Kozhikode
and the Indian Institute of Management, Rohtak.
Anand Das Gupta did his doctorate as a UGC research Fellow. He has published
many papers in various refereed journals and has four books to his credit in the
areas of organizational development, strategic human resources management, corpo-
rate social responsibility and business ethics. He is currently the Editor-in-Chief of
the International Journal of Business Ethics in Developing Economies, and serves
on the Editorial Boards of leading international journals. He is also one of the Editors
of Encyclopaedia on Corporate Social Responsibility, published in five volumes by
Springer. Moreover, he has published a monograph titled “Business Ethics: Texts
and Cases from the Indian Perspective” with Springer in 2014.
Contributors
Santosh Basavaraj School of Business and Management, CHRIST (Deemed To

Be University), Bangalore, India
Aruna Das Gupta Independent Researcher On CSR, Bengaluru, India
Arka Ghosh XLRI–Xavier School of Management, Jamshedpur, Jharkhand, India
Tamanna Girdhar UN Global Compact Network India, New Delhi, India
ix
x Editor and Contributors
Ananda Das Gupta Flat No. 244, Kengeri Satellite Town, Bangalore, India
Aneel Karnani Ross School of Business, University of Michigan, Ann Arbor, USA
Yumna Khan Sustainable Advancements (OPC) Private Limited, Kolkata, India
J. Kiranmai Institute of Public Enterprise, Hyderabad, India
S. J. Mascarenhas JRD Tata Chair Professor of Business Ethics, XLRI,
Jamshedpur, Jharkhand, India
Khushboo Mehta Sustainable Advancements (OPC) Private Limited, Kolkata,
India
R. K. Mishra Institute of Public Enterprise, Hyderabad, India
Nayan Mitra Sustainable Advancements (OPC) Private Limited, Kolkata, India
Joy Mukhopadhyay ThinkCorp Consultancy Services, Kengeri Satellite Town,
Bengaluru, Karnataka, India
A. J. Oswald JRD Tata Chair Professor of Business Ethics, XLRI, Jamshedpur,
Jharkhand, India
Sreelakshmi. P School of Business and Management, CHRIST (Deemed To Be
University), Bangalore, India
Subhasis Ray Xavier Institute of Management Bhubaneswar, Bhubaneswar, India
Shulagna Sarkar NLC India Ltd, Chennai, India
Kamal Singh UN Global Compact Network India, New Delhi, India
S. Venkataraman Indian Institute of Management, Kozhikode, Kerala, India
Human Values in Corporate Social
Responsibility: A Case Study of India
Aruna Das Gupta
Without values, community life would be a chaos and individual life meaningless.
A ‘value’-less life is a valueless life. And who wants a life that’s not worth a dime?
We all want our life to have some meaning, some direction and some self-evolved
authority for guidance. Along other values moral values regulate human conduct at
much deeper levels of our personality than most other values do. Moral values have
a tendency to take preference to over other values. Values grow, change and take new
look according to human’s attitude. When people examine their thoughts, action and
feelings for it is through these that people values are expressed. ‘Although values
are not themselves belief’s or judgments, they necessarily come to expression in
and through thought. Although values are not feelings or emotions, they inevitably
involve desires and fears. Although values cannot be defined as deeds, they always
are mediated through specific acts. To paraphrase and expand on Kant; values without
reason would be blind, without feeling would be impotent, and without deeds would
be empty’ (Richard, 1980).
Values provide an in-built standard of reference and judgement for our actions.
Values are by no means static, permanent and unchangeable. We may have good
reasons for abandoning a value or incorporating a new one in our system, but that
process involves its own justification and careful reckoning. Of course, unlike our
beliefs and attitudes, values are not chosen or abandoned casually, because something
very vital is at stake here—the self’s own estimate of itself.2 ‘Value is that quality of
anything which renders it desirable or useful (A vedanta Kesari Presentation, 2001).
In this light let’s look at which values in business would render it useful for
spiritual growth. Here the philosophy of Vedanta has much to offer the spiritual
Author Note: This chapter draws from the author’s previous publication published in International
Journal of Business Ethics in Developing Economies; Vol 1; Issue 1;July, 2012. Reproduced with
permission of the copyright owner. Further reproduction prohibited without permission.
A. Das Gupta (B)

Independent Researcher On CSR, Bengaluru, India
© Springer Nature Singapore Pte Ltd. 2022 1

A. Das Gupta (ed.), A Casebook of Strategic Corporate Social Responsibility,
CSR, Sustainability, Ethics & Governance,
https://doi.org/10.1007/978-981-16-5719-1_1
2 A. Das Gupta
aspirant. Vedanta offers a perspective that nurtures values conducive to business.

Each of these values needs to be complementary to one’s inner practice.
Unity in variety is the basis for all ethics and values, in business as well as our
individual lives. You can’t have one set of rules for business, and another for your
personal life. There is one set of values or ethics for all individuals. There is no ‘class’
structure in ethics. One of the foremost values in business is the ability to approach
work as selfless service or worship called karma yoga. Business can become karma
yoga when people are engaged in selfless action without regard to the result. But in
real life we cannot be so selfless, but we should not overlook the values. We must
strive to have the right intentions as well as the right action.
All of the really successful companies have established their success on the
bedrock of customer service. This value is easily spiritualized into serving the highest
aspect in man: seeing the customer as a manifestation of the divine. People have to
work with a real sense of cheerfulness, knowing that the results of the ‘game’ are not
in our hands. Business is not the be all and end all of life. It becomes much easier to
keep our sense of balance at work when we have a higher purpose that transcends all
business endeavours. And with this value, it is much easier to resist the temptations
to let the end justify the means in any business decision.
Surrender or patience is a key value in business. By this people can learn to keep
their ego out of their way. And when people share an attitude of openness, this rein-
forces the ability to celebrate variety. When people are open to others, they become
tolerant and accepting. In business, these values gain respect and fair competition.
When value gives respect and fair competition in business, with these ‘giving back
to society’ becomes more significant. Value teaches us truthfulness, kindness and
equality. Apart from these, there are social values, aesthetic values, cognitive values
and spiritual values.
Concept of corporate social responsibility has only recently been formulated, but
it has a long history in both the east and west called social philanthropy. According
to changing in nature of business, it can be divided into three areas. Traditional
corporate philanthropy was concerned for the welfare of the immediate members of
the corporate body like the staff and employees and their families. Contributions by
visionary business leaders, who build different institutions through individual shares,
like some educational trust, women welfare, etc.
The challenging issue on corporate social responsibility is pointed towards stake-
holder and more like people, planet and profit. Sustainable development, economic
sustainability and corporate profits should be analysed in conjunction with social
prosperity. Along with this, CSR practice applied in ethical business is more
fundamental, emerging trend on the international scene.
In India, CSR is known from ancient times as a social duty or charity. This is a
concept which through different ages converging its nature into broader aspects. Now
it is generally known as corporate social responsibility. From the origin of business,
which leads towards excess wealth, social and environmental issues have deep roots
in the history of business. Over the time four different models have emerged all of
which can be found in India regarding corporate responsibility.
Human Values in Corporate Social Responsibility … 3
The first is the ethical one where there is voluntary commitment to public welfare.
In India, it has its roots in the Gandhian philosophy of trusteeship. The second model
is of state-owned PSUs. They provide housing and schools to workers. They have
existed in India since 1947.
The third is the liberal approach where the belief is that the free market could take
care of corporate responsibility. Since the late 80s and 90s there has been increasing
realization that business has a social responsibility. This has come about through
public campaigns and pressure on the shareholders. The fourth is the stakeholder’s
model. Corporate responsibility now means ethical and environment-friendly prac-
tices. Companies are expected to stick to the Triple Bottom line of economic,
social and environmental responsibility towards workers, the shareholders and the
community.
India has had a long tradition of corporate philanthropy and philanthropy is prac-
tice of doing well to one’s fellow men. It is not a relationship—therefore corporate
philanthropy often does not have stakeholders’ interaction and responsibility as a
focus, unlike corporate social responsibility. Corporate social responsibility, on the
other hand, is undertaken by the company not along charitable lines or with the ‘intent
to do good’ but also building of a good public image.
The concept of corporate social responsibility gained global prominence in the
last 10 or 15 years. The rise of corporate social responsibility can be attributed to the
process of globalization and to the increase in the reach of transnational corporations.
Historically, the philanthropy of business people in India has resembled Western
philanthropy in being rooted in religious belief. Merchants’ charity took various
forms, such as treasury chests for the needy, providing relief in times of famine
or floods, provision of drinking water, building temples, water tanks, wells, ponds,
supporting schools, etc. Merchants gave for charity both individually and collectively
through their business and social organization.
On attaining independence, the main emphasis was being put on economic pros-
perity and social justice at large. On the role of the business community, JRD Tata
advised: ‘Apart from the obvious one of donating funds to good causes which has
been their normal practice for years, they could, as some of the companies with which
I am connected have done, use their own financial, managerial and human resourced
to provide task forces for undertaking direct relief and reconstruction measures. This
form of public community service could be expanded by the cooperative effort among
members of various industries’ (Kumar et al., 2001).
The last decades of the twentieth century witnessed a swing away from charity and
traditional philanthropy towards more direct engagement of business in mainstream
development. Most corporate houses have been contributing to social cause largely
through their own trusts, foundations and societies. Some of these were set up long
before India achieved independence. Today there are over 200,000 private-sector
trusts in India, a large number of which have been set up by business. In survey in
1997, conducted by the Social and Rural Research Bureau of 650 randomly selected
companies from top 2000 (of there, 13% were MNCs) revealed that most CEOs
acknowledge the companies have a social responsibility, only 36% reported some
sort of policy, of there only some had policy and person in charge. Nearly 81%
4 A. Das Gupta
provided an account of various activities of corporate social responsibility on India

(Gujarat Chambers of Commerce, 1963).
Ranbaxy an Indian MNC (Tata Press, 1986), in the pharmaceutical sector, set up
Ranbaxy rural development trust to provide basic health care to the underprivileged
through mobile health care that reaches out the needy in villages and slums. Ranbaxy
community healthcare society provides preventative health care, social communica-
tion immunization, family planning and contraceptive distribution, along with this
Ranbaxy Research Foundation promotes scientific and medical research.
The Mahindra Group of companies encourages education of employee’s children
by running schools at plant sites. It also supports education for all at all levels by
providing studentship, loans and scholarships for research students studying over-
seas, rehabilitation of disabled children, distribution of free books to children in slum
and rural areas, and the endowment of the chair for research in nuclear sciences and
journalism. The Mahindra Education Trust supports primary education for female
children through various NGOs and provides relief work at time of natural disasters
and care for cancer patients.
Reliance Ltd. (Puspa, 2000), an Indian petrochemical MNC, has been supporting
rural development work, modern healthcare facilities in rural areas, scholarship for
rural children for higher education in cities and lying of water Pipelines in Jamnagar
to improve access to drinking water. Rural development and social work begins with
the focus on health, hygiene and education. The company also provides relief and
rehabilitation at times of cyclones, medical care and mobile health care for villagers.
Reliance also is the main corporate promoter of the Hyderabad-based Indian School
of Business, which has been set up in Academic Association with the Wharton and
Kellogs Schools of the USA.
National Thermal Power Corporation has a conviction of having growth with
a human face, and focussing on people- centred development. It is being reported
that NTPC is a socially committed organization and a socially responsible corporate
citizen.
Sensitive to the social issues since its inception, the organization framed guidelines
for the facilities to be given to the project affected. In this regard, Resettlement and
Rehabilitation programme was formulated in 1991 and revised in May 1993.
The Resettlement and Rehabilitation programme aims at improving the overall
economic status of Project Affected Persons (PAP). This is achieved by providing
opportunities in the fields of sustainable income, health, education, sanitation,
communication and other such areas. Community development activities are carried
out in a transparent and participative manner. Each programme is based on the specific
local requirement and guided by the extensive socio-economic surveys, which verify
that project affected persons improve or at least regain their previous standard of
living. The PAP is systematically categorized on the basis like, in resettlement, devel-
opment alternate free house plot in resettlement colony with necessary infrastructure
facilities. Free transport arrangement for belongings and reusable material. Infras-
tructure to be provided includes primary school, dispensary, panchayat ghar, drinking
water, well, hand pumps, roads, drainage, sulabh sauchalaya, etc.
And in rehabilitation, land for land, self-employment such as dairy, poultry,

handcraft, shops, award of petty contracts and jobs.
Recognizing the importance of sound institutional framework to achieve the
desired results NTPC has set up dedicated R&R cells. Along with them profes-
sional NGOs, consultants also involved, encouragement has been given for the
formation of informal groups, employees, and their families, service groups for the
socio-economic development of the areas (Tata Press, 1986).
Haldia Petrochemical Ltd. is India’s largest integrated naphtha-based petrochem-
ical complex. The company has achieved sustainable and profitable growth through
delivery of innovative world-class products and services of exceptional value to
customers. They also care their customers care of each other and care for the commu-
nity and environment. They take pride in the quality of their products and services,
business ethics, to create outstanding value for their shareholders and customers.
Regarding corporate social responsibility their focus areas are as follows:
• Social Welfare.
• Community development.
• Environment.
• Occupational health and safety.
• Water management.
In the field of social welfare, mass wedding in association with NGO’s, Haldia
Utsav, (letting creativities flow), Haldia network (putting Haldia on the cultural
roadmap) patronizing the local deaf and dumb school and blind school, rehabil-
itation of evictees, roads, electricity, water bodies, green belt, donations to local
schools, distributing computers and school bags.
In community development, skills development with the assistance of Lokshiksha
Parishad, Flood relief, Medical aid, financial assistance for local and national
sports and cultural events. Posters and drawing contests involving school chil-
dren of Calcutta theme being ‘ stop littering start recycling’ look forward to a
dirt-free environment-friendly Calcutta. OHS-gaseous emissions minimized with
most modern state-of-the-art technology from world-renowned licensors for ensuring
health and safety awareness programme. Managing water resource from rainwater
harvesting, domestic use and minor irrigation.
Dr. Reddy’s Laboratories in Hyderabad, Andhra Pradesh is an emerging global
pharmaceutical company focussed on creating and delivering innovative healthcare
solutions that enable people to lead healthier lives. Dr. Reddy’s main focus areas
are in education, eliminating child labour and lively hood development. Regarding
this Dr. Reddy’s Foundation for human and social development established. The
foundation is headed by an Executive Director and ably supported project officers
and Research I from Dr. Reddy’s lab, UNICEF and UNDP.
Their Child and Police (CAP) project is a unique and innovative joint programme
of Andhra Pradesh state and Dr. Reddy’s foundation for human and social devel-
opment. The project’s vision is to identify and work with children at risk, put them
through enriched quality school education and a sustainable livelihood education
programme that will enable them to fight illiteracy, ill health and poverty. Members
6 A. Das Gupta
of the CAP team visit slums and factories, conducting street- by-street surveys to
identify and rehabilitate economically disadvantaged children. Families are then
convinced to send their children’s to the foundation’s Bridge school, where they are
put through child-friendly syllabi, 4–8 months later, depending on the age and prior
literacy level, they are integrated into the mainstream public education system. Police
participation greatly enhances the CAP project in its efforts to get children off the
streets and on to a better life.
The livelihood advancement business schools (LABS) are to provide young adults
from economically weak backgrounds an opportunity to assimilate into the compet-
itive job market. LABS target youth at risk on and off the street from the econom-
ically weakest category and offer formal education, career counselling, personality
development, and skill development and apprenticeship opportunities for sustainable
livelihoods.
Besides these two projects another programme named Tulasi is aiming to create
models, which can be replicated regarding any of these activities (CAP and LABS).
The guiding principles for social responsibility in the TATA group evolve from
its rich heritage and traditions of trusteeship as a way to redistribute the wealth
created by the industrial society kept aside exclusively for the benefit of people at
large. Building on they also increasingly recognize that in modern industrial orga-
nizations, the connotation of wealth goes beyond the money donated to charitable
cause. ‘The company shall have among its objectives the promotion and growth of
the national economy through increased productivity, effective utilization of mate-
rial and manpower, resources and continued techniques in keeping with the national
aspiration; and the company shall be mindful of its social and moral responsibili-
ties to the consumers, employees, shareholders, society and the local community’
by J.R.D.Tata to be adopted by the board of TATA companies to reinforce their
commitment to social responsibilities made on 14 December 1999.
The community is central to the core values we adhere to in the Tata Group.
Tata community programmes aim at building trust and improving the quality of life.
Tata programmes facilitate sustainable change. We believe that community gives us
valuable opportunities to learn. Commitment to social responsibility is explicit in
every Tata Company.
We network through our core competence to empower communities. Tata volun-
teers are committed to the spirit of service. ‘Community development is a well
understood objective and important cornerstone of the TATA business philosophy.
In fact, it is key element in the TATA business Excellence Model. Therefore, it is
incumbent on every Tata Company’s management to consider it to be an essential
component of its strategic plan towards achieving the company’s and the group’s
objectives. The strategy that each company evolves, needs to be focussed on the
real needs of the communities in which the company operates and which it seeks to
serve. There needs to be a dovetailing of the skills and strengths of the company and
its employees with the immediate and longer-term gaps in the overall development
of these communities- be they in the field of education, health, environment, civic
amenities, infrastructure, family planning, vocational skills etc. Essentially one has
to ensure that the strategic economic well being of the community is brought about
expeditiously. Our founder’s humanitarian objectives of over a century ago need to

become strategic to the group today’.
Larsen & Toubro Limited is the nucleus of a group of companies with manu-
facturing complexes, work sites, offices and service outlets at several locations in
India. Two Danish engineers, Henning Holck-Larsen and Soren Kristian Toubro, as
a partnership firm, founded it in 1938. It offers wide range of products and services.
In 2002-03, it generated a turnover of Rs. 10857 crore. Good corporate citizenship
has been the underlying concept behind the operations of L&T since it’s founding
as partnership firm in 1938. More recently, the beliefs of L&T in this respect have
been codified in the L&T Vision.
Over the last six decades and more of operations, L&T has endeavoured
to discharge its social responsibilities to its various constituents like customers,
employees, shareholders, vendors, suppliers, subcontractors, government, educa-
tional institutions, social service organizations and the public at large through various
means. These efforts have been widely recognized in various ways. Below is only
an indicative list of its various CSR activities.
In the area of strengthening education, L&T has encouraged the children of
employees to seek educational excellence by recognizing their academic achieve-
ments through the award of cash incentives. L&T has established its own L&T
Institute of technology providing engineering diploma courses for the children of its
employees.
In the area of health delivery systems, the company’s health centre, Mumbai,
extends diagnostic and medical facilities to the neighbouring community and has
done award-winning work in the areas of population control, leprosy and T.B.
Widespread health facilities to the community are provided at L&T’s various cement
plants.
Contribution to conservation of environment L&T has done extensive tree plan-
tation in its factory campuses and surrounding areas as well as in cities and towns
like Baroda, Surat, Mumbai and Chennai. In the area of alleviating poverty and
giving less privileged children a better future, L&T has undertaken rural and tribal
welfare schemes in the villages surrounding many of its factories—Hazira in Gujarat,
Bangalore, Awarpur in Maharashtra, Hirmi in Madhya Pradesh, Tadipatri in Andhra
Pradesh, Durgapur in West Bengal, Kovaya in Gujarat and Arakkonam in Tamil
Nadu.
In the field disaster relief, L&T has prompt in responding to the needs of the
nation. The recent earthquake in Gujarat L&T Group of companies donated over Rs.
5 crore in cash and kind. Equipment, emergency rations and other supplies for those
devastated by the earthquake were also mobilized. L&T had also adopted two villages
in Gujarat, Kirai and Nilpar, Rapar Taluka of Kutch District for rehabilitation.
Beyond growth and profitability, L&T’s mission involves pursuit of business ethics
and social responsibility. L&T is acutely aware that it could have done more for the
community. But, as a corporate body, it has to get into areas where it could function
consistently with its overall business mission and on a sustained basis. It is scanning
horizons for greater involvement in community welfare to reinforce its credentials
as a good corporate citizen.
8 A. Das Gupta
For nearly 50 years now, the Aditya Birla Group has been and continues to be
involved in meaningful, welfare-driven initiatives that distinctively impact the quality
of life of marginalized people, surrounding hundreds of villages near its plants spread
all over India—villages that are among the poorest in India.
The Group believes in the trusteeship concept of management, which entails
ploughing back part of its profit into community initiatives. From this stems its social
involvement, far beyond business. The Group’s projects mirror its moral conscience.
They reflect its values. Its community work is a way of telling the people among
whom it operates that they are cared for.
The Group’s activities are wide and far ranging. Starting from encompassing
innovative projects such as providing the rural youth with a chance to shaping their
future through economic development schemes, education and training and health-
care projects, reaching out to physically impaired people who are tremendously disad-
vantaged—all are included in the community development programme. Espousing
social causes like widow remarriages, dowry-less marriages, Women empowerment
programmes and also sponsorship of the arts and Indian culture based largely on a
real assessment of the needs of the communities.
The Aditya Birla Group views its social responsibility in a much larger perspective,
the one that goes beyond philanthropy. They take their social and rural projects very
seriously. Its social vision is an integral part of business vision of all the Group
companies.
Having gone through the corporate efforts towards initiating social responsibility
in the present-day scenario, we may have an observation, which can find its genesis
in the past old days through a kind of historical legacy.
India’s experience with corporate responsibility is not new. In its old form, corpo-
rate responsibility in India has a concept of corporate philanthropy. This means
corporate donations, community investments in trusts, schools, hospital, etc. Now
the eve of privatization and globalization corporate responsibility becomes an inte-
gral part of business strategy. In India, as in the rest of the world, there is a growing
realization that capital markets and corporation are, after all created by society and
must therefore serve it, not merely profit from it16 . Changing global economy is
whether corporations operating in less developed countries have a responsibility to
promote socio-economy development. Corporation does contribute to development
in substantial ways by undertaking their basic activity to generate profits for their
shareholders, employees, consumers and communities and over all society through
socio-economic development.
Most conspicuous and consistent among the advocates of corporate social respon-
sibility has been the house of Tata, Mafatlal, Hindustan, Dr. Reddy’s Laboratories,
Haldia Petrochemical Ltd, NTPC, The Mahindra, Ranbaxy, Infosys Ltd, Satyam,
Aditya Birla Group, L&T, etc.
The corporate sector in India is dominated by family firms, not only in terms of
overall numbers, but also with respect to representation among the largest compa-
nies. Some of the more prominent of the family controlled business houses have a
history of corporate philanthropy and involvement in community development dating
back to the last century and the early part of this century. These commitments, in
most instances instilled by the founder of the firm, have expressed themselves in
a wide varity of areas, but especially visible has been support for educational and
research institutes, hospitals and healthcare facilities, cultural and religious soci-
eties, recreational and sports programme and disaster relief programmes and in
many instances these business houses have also been involved in rural development
projects, especially in areas surroundings large industrial plants.
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Corporate Social Responsibility
and Sustainability Development
Mapping: Practical Application Beer
and Nigel Roome Model
Santosh Basavaraj and Sreelakshmi. P
CSR Introduction
CSR is an evolutionary concept and different schools of thought perceived it in

a different way. Neoclassical economists (Friedman, 1970; Aupperle et al., 1985;
McWilliams & Siegel, 1997; Jensen, 2002) argued that in theory CSR investment
will unnecessarily increase corporate costs, thus placing companies in a situation of
competitive disadvantage. On the other hand, scholars have argued that CSR leads
to the creation of unanticipated opportunities (Fombrun, Gardberg & Barnett, 2000)
and increased social activities may result in accessing better resources (Cochran
& Wood, 1984; Waddock & Graves, 1997), superior quality employees (Turban &
Greening, 1996; Greening & Turban, 2000), and healthier marketing of products and
services (Moskowitz, 1972; Fombrun, 1996).
Baron (2001, p10) argues that ‘Corporate Social Responsibility is an ill- and
incompletely defined concept’. In many literature reviews, the popular definition
given by World Business Council for Sustainable Development (WBCSD) (2004)
is ‘CSR is the commitment of a business to contribute to sustainable economic
development, working with employees, their families, local community and society
at large to improve their quality of life’. This definition considers a stakeholder
approach to CSR. According to Lantos (2001, p. 600), CSR is the ‘organization’s
obligation to maximize its positive impact and minimize its negative effects in being
a contributing member of society, with the concern for society’s long-term needs
and wants’. Bowen (1953) argues that ‘the obligations of businessmen to pursue
those policies, to make those decisions, or to follow those lines of action which are
desirable in terms of the objectives and values of our society’ (as cited in Wolff &
Barth, 2005, p. 6). McWilliams & Siegel (2001) defined CSR as ‘actions that appear
S. Basavaraj (B) · Sreelakshmi. P

School of Business and Management, CHRIST (Deemed To Be University), Bangalore, India
e-mail: santosh.basavaraj@christuniversity.in

https://doi.org/10.1007/978-981-16-5719-1_2
12 S. Basavaraj and Sreelakshmi. P
to further some social good, beyond the interests of the firm and that which is required
by law’.
Porter and Kramer (2006) considered CSR as ‘inescapable priority’ for business
leaders. In addition, Porter and Kramer (2006) & Moir (2001) point at the moral
appeal and emphasized that the expectations of society are that business has an obli-
gation to ‘do the right thing’, namely, to act in a responsible manner. Carroll (1979)
developed a more structured analysis and devised a four-part definition of CSR, being
economic, legal, ethical and philanthropic (or altruistic or humanitarian). Mohr &
Webb (2005, p 139 & p142) pointed that CSR had a significant and positive influ-
ence on company assessment and purchase intention. Results of their experiments
revealed that American consumers ‘reacted more strongly to negative than to positive
CSR’ and that a ‘low price did not appear to compensate for a low level of social
responsibility’.
The European Commission defines it as ‘a concept whereby companies decide
voluntarily to contribute to a better society and a cleaner environment’ by inte-
grating ‘social and environmental concerns in their business operations and in their
interaction with their stakeholders’ (COM, 2001, 4). This is also described as ‘busi-
ness’s contribution to sustainable development’ (OECD, 2001, 13). Schaltegger &
Burritt (2005) stated that CSR management is comparable to corporate sustainability
management, which intended to combine the economic, environmental and social
aspects of corporate business. Most authors also emphasize this aspect of ‘going
beyond legislation’. Lantos (2001) argues that ethical CSR is obligatory. Wilson
(2000) coined a word ‘social nature’ that says that a corporation must voluntarily
acknowledge some degree of moral/ethical duty beyond its legal obligations. Lantos
(2001) considered it as a ‘win–win situation’ where investment in CSR will give a
financial return for the corporation. CSR is also termed as ‘one’s responsibility for
one’s impacts over society’ (EU, 2001).
Stanwick and Stanwick (1998), Brammer, Pavelin (2006) & Udayasankar (2008)
relate the size of companies and their respective CSR participation. These studies
concluded that the bigger the corporation (total revenue), the better will be its moti-
vational base for CSR participation. McWilliams & Siegel (2001) stated that CSR
creates a kind of reputation that a firm is reliable and honest and that consumers will
be inclined to think that products from such companies would be of a higher quality.
Frankental (2001) quoted that it is a sort of ‘public relations exercise’. The perception
about CSR is gradually changing; it has been observed that CSR is producing tangible
and intangible competitive advantages (Baden, 2010; Coughlan and Coghlan, 2011).
The relationship between financial performance and CSR is very difficult to quan-
tify but still, the positive correlation is developing from neutrality (McWilliams &
Siegel, 2001) to positivity (Orlitzky, 2001; Orlitzky et al., 2011). Intangible benefits
are gathering significant focus and forecasted to be as high as 80% of a company’s
market value (Hughes & Demetrious, 2006; Blowfield & Murray, 2008). Busi-
ness practitioners and academicians have shown considerable interests towards CSR
(Gorte, 2005, p.140; Stites & Michael, 2011). At the same time, there is a growing
need to seriously examine corporate social actions, particularly the role of corpora-
tions in shaping the development of local communities and this activity goes beyond
Corporate Social Responsibility and Sustainability Development … 13
mere philanthropic activity (Lakin & Scheubel, 2010). Business behaviour must
be focussed at satisfying societal needs, generating revenues and profits, creating
employment and investing its resources for better environments for companies and
society (Jozica Knez et al., 2006). The concept of Triple Bottom Line given by
Andrew Savitz (2006) reiterates three areas for any business, namely, planet (envi-
ronment), people (society), and profit (economics). McWilliams & Siegel (2001)
defines CSR as actions of the companies that intend to do some social good that is
ahead of the immediate interests of the firm, shareholders and law. Here we enter
the area of corporate activities that serve society and entail little or no business
gain—which could be called ‘altruistic CSR’ or ‘unselfish CSR’ (Lantos, 2001) or
‘philanthropic responsibility’ (Carroll, 1991).
Current Scenario of CSR in India
History of CSR in India
Before we glance at the CSR practices of TKML, India, it is essential to understand

the history of CSR in India at macro-level. CSR is an old concept for India, it which
existed in the form of philanthropic activity from late 1800s and during 1900s phil-
anthropic activities took the form of community service, donation and charity (Prab-
hakar & Mishra, 2013). Evolution of CSR in India is started with Mahatma Gandiji’s
Trusteeship theory. As per this theory, companies are considered as the trustees who
acted in favour of stakeholders interest, from 1947 to 1970 India noticed phenomenal
growth in public sector enterprises and social responsibility ruled by various laws
and its provisions, this period is popularly known as Inspector Raj (kingdom) (Prab-
hakar & Mishra, 2013). 1970 to 1990 was a period of public enterprises dominance,
this stage reached maturity and paved a way for private sector CSR activities. Post-
1990 due to liberalization, globalization and privatization (LPG) world’s leading
companies started their operations in India and hence more time and resources were
channelized to CSR activity.
‘Key drivers of Indian CSR are deeply engrained in the Indian heritage’ (Supriya
Kummamuru, MGPL Narayana, Suyash Kumar Chopra, 2012). Another major
reason for the growing CSR movement in India is brining CSR into the statutory
law coverage, contribution clause of two percent of profits dedicated for CSR cause
(Supriya Kummamuru, MGPL Narayana, Suyash Kumar Chopra, 2012). According
to the amended Companies Act 2013 (implemented with effect from April 2014),
private and public limited companies with net worth of INR 500 crores ($66.63
million at 75.04 USD-INR rate) or turnover of INR 1000 crores ($133 million at
75.04 USD-INR rate) or net profit of INR 50 crores ($6.66 million at 75.04 USD-INR
rate) need to spend two percent of its average net profit for immediately preceding
three financial years on CSR-related activities (IANS, New Delhi 2014). As per this
amendment, normal business activities of corporate cannot be considered as CSR
and it must be any activity prescribed in Schedule VII of the Companies Act 2013
where preference shall be given to local area surrounding the companies.
Further, this act provides guidelines for companies to execute CSR activities with
its own CSR department or in association with any agency or institution. Companies
need to submit detailed accounting of CSR spending, and the formation of CSR
committee comprising of three or more Directors, out of which one must be inde-
pendent Director. If a company fails to spend prescribed amount it has to explain the
reasons in CSR report for not complying the regulations and that is to be enclosed
along with yearly Board report (Ekta Bahl, 2014). The total approximate spending
of CSR was 8691 crores ($1158 million at 75.04 USD-INR rate) as per the report
of spending of 2019–20 (Khetarpal, 2020). Further, the ministry of corporate affairs
amended the act and enabled companies to collaborate for CSR activities (Deepak
Patel, 2015). Due to Government of India’s effort, CSR is taking a concrete shape
in India. More and more companies are joining the CSR movement. But the study
backed by software giant Tata Consulting Services (TCS, 2015) in association with
GRI titled ‘Moving beyond disclosure: Leveraging sustainability reporting to drive
change’ revealed that the activities related to governance and environmental issues
are not considered seriously in sustainability reports by Indian companies (PTI, May
2015). Considering all these developments, The Institute of Chartered Accountants
of India (ICAI) has issued accounting guidelines that helps companies to account
CSR-related expenses in their annual financial statements. (Lubna Kably, 2015).
Amendment to Companies Act has brought swift changes in the status of CSR and
it started attracting NGOs, research scholars and other related business organizations.
In India, which is known for its contribution to the world in field of Information
Technology (IT) and providing variety of software to different business functions,
all IT companies started contributing the CSR cause. Another latest development is
‘CSR Consultants’ who provide consultancy services in end-to-end management of
CSR activities.
Idea About Stakeholder View
In order to capture the holistic understanding of the cybernetics model, it is necessary

to understand the various stakeholders associated with the corporation. Companies
are increasingly bringing the concepts of stakeholder management in sustainability
reports and CSR reports (Perrini & Tencati, 2006). The central focus of the stake-
holder view is not to focus only on shareholders, but it is also an obligation towards
multiple groups and individuals (Donaldson & Preston, 1995). The term stakeholder
theory suggests ‘systematic attention to stakeholder interests is critical to firm’s
success’, as stakeholders have a strong influence on the achievement of company’s
goals (Freeman & Reed, 1983). From the point of view of stakeholder theory, stake-
holders are termed as ‘all individuals and constituencies that contribute, either volun-
tarily or involuntarily, to its wealth-creating capacity and activities, and are therefore
its potential beneficiaries and/or risk bearers’ (Post et al., 2002, p. 19). Friedman
(1962) states ‘the business of business is business’, the classical view of economics
contradicts the theory of stakeholder view. Henriques & Sadorsky (1999) recognized
four stakeholder groups that force firms to guard the natural environment: regulatory
stakeholders, organizational stakeholders, community stakeholders and the media.
Clarkson (1995) identified two types of stakeholders. Primary stakeholders are those
who are vital for firms to survive such as investors/shareholders, employees and
customers, and secondary stakeholders are those who are not very important for its
survival. Clarkson (1995) as well as Waddock & Graves (1997) argue that when a
firm pursues to satisfy multiple constituency needs, it actually increases its financial
performance.
Bansal (2005) states that the time when company tries to satisfy its stakeholders,
same will be reciprocated in the form of loyalty and support, eventually leading
to superior performance. Adding to this, proponents of stakeholder management
theories advocate that CSR strategies may show the way to better performance by
defending and enhancing corporate status (Fombrun & Shanley, 1990; Fombrun,
2005; Freeman et al., 2007). Andriof & Waddock (2002) as well as Gond & Mercier
(2004) examined stakeholders’ legitimacy and exercise of power within companies.
Management’s response towards the pressure of different stakeholders also differs;
availability of financial and other resources also determines the kind of response.
Management response also depend on power, legitimacy and urgency of the stake-
holders claims (Mitchell et al., 1997). The Global Reporting Initiative (GRI) provides
broad guidelines on the modes of interaction with the stakeholders, outlining how to
solve stakeholder concerns and mechanisms to resolve stakeholder pressures on the
organization (GRI, 2012). Roome (2012) considers that stakeholder engagement is
rather more concerned to the control activity of the organization than intelligence and
sensing function. Hence, the core ideology of stakeholder management and engage-
ment is associated with sensing the pressure from the environment (Harrison &
Freeman, 1999). Managing multiple stakeholders is a challenge and art, as the same
corporation cannot please all the stakeholders all the time (Hall and Vredenburg,
2005). Therefore, it is very important for organizations to determine the signifi-
cance of different stakeholders associated (Henriques & Sadorsky, 1999). Kinder,
Lydenberg, Domini Research & Analytics (KLD) score covers the dimensions like
corporate governance, community, workforce diversity, employee relation, product,
environment and human rights (Mattingly & Berman, 2006).
Idea About Sustainability Development (SD): CSR versus SD
Basavaraj et al. (2018) in their study indicated that Toyota adopts a strong approach
to sustainability, it cannot unequivocally claim that the cybernetic approach furnishes
a better management model than the stakeholder approach. However, their research
provides a framework for illustrating the way in which a company might grow in
terms of CSR and sustainable development. For some, sustainability is restraining and
expensive external demands, whereas for others, sustainability is a genuine chance
to create value (Jahdi & Acikdilli, 2009; Persaix, 2002). Sustainability is the process
of maintaining productivity at a constant pace with the usage of natural and human
resources without harming the natural biotic systems (Hendrix, 2014).The popular
definition of Sustainable Development (SD) comes from the Brundtland Report
(1987, p. 8) where it is termed as ‘meeting the needs of the present (generation)
without compromising the ability of future generations to meet theirs’. Satisfying
the needs of present generation is essential but it should not be done at the stake of
future generation, privileges enjoyed by present generation may not be deprived for
future generation. SD is mainly considered as a macro-concept, as it covers a holistic
and higher level of interpretation than considering the action of only one company
(Luis et al., 2012). Further, Luis et al. (2012) discussed that CSR is a company-level
action and decision-making process, whereas SD concerns country-level and global-
level initiatives and commitment. Roome (2011) referred that companies that are
searching way (Patel, 2015) to contribute to SD would establish the means to sense
environmental change and to measure the impacts of its operations and activities
which can be termed as the carrying capacity of a firm. Yuniarta & Purnamawati
(2017) showed that there is nothing wrong in mapping of the implementation of
distribution of CSR funds, but it would be good also to focus on distribution of the
things that can contribute to the long term.
The United Nations World Summit Outcome Document (2005) has identified
economic, social development and environmental protection as three main pillars
of sustainability development and they must be given equal importance. The social
category is further divided into the following subcategories: labour, society, human
rights and product responsibility (Luis A et al., 2012). In the present context, compa-
nies use CSR as a vehicle for sustainable development (Moon et al., 2012). Roome
(1997) argued that CSR is the practical business contribution to SD or corporate envi-
ronmental responsibility. An empirical study was conducted in Bangladesh to find
the impact of CSR on fostering sustainable development (Moyeen et al., 2014), and
this study revealed that environmental issues and sustainability development issues
remain top priority for the managers while considering CSR activities.
These days almost every company is excited to display their corporate sustain-
ability report on their websites as companies include CSR performance in their
sustainability reports. These reports are descriptive, qualitative, visual and provide a
more situational view of the company’s activities, also complement financial results
(Giordano-Spring & Rivie‘re-Giordano, 2008). Sustainability reports are new instru-
ments for explaining and arguing social strategy, focussing stakeholder and finan-
cial institutes (Capron & Quairel, 2004). The GRI gives thorough guidelines on
preparing sustainability reports and also the recently established ISO 26000 that
provides guidelines for organizations to carry out business in a responsible way. The
standards describe CSR as the major action to contribute to the earth’s sustainable
development, (Luis et al., 2012).
Roome (2011) coined the terms weak sustainability and strong sustainability, both
represent progressive ideas and bring new concepts like product stewardship, supply
chain management into management practices (Roome, 1994). Weak sustainability
is considered as the business initiative on reducing its negative effect on environment
(Roome, 2011). Strong sustainability involves progressive activities that fit within
the carrying capacity or sustaining capacity of the environment at different levels.
Here new ideas are operationalized within the system where various other actors are
present and firm’s products and services are utilized. It is like seeing the bird’s-eye
view of the system and understanding the difficult interrelationships and associ-
ations between parts of the system (Ackoff, 1999). Frishammar & Parida (2018)
opined that to achieve positive economic, environmental and social benefits, many
incumbent manufacturing firms attempt to apply circular economy principles to their
business practices and proposed a roadmap for circular business model transforma-
tion providing a step-by-step process to enable circular transition, allowing compa-
nies to meet environmental, social and financial objectives and proactively address
sustainability. According to Roome & Louche (2016), three elements contributed
to the path of transformation towards business models for sustainability: building
networks and collaborative practices for learning and action around a new vision, the
deployment of new concepts drawn from outside the company and elaborating an
implementation structure within a reconfigured network. It’s important to consider
value destruction and new ways to create and capture value.
Idea of Cybernetics
The word cybernetics was first noticed in 1943 while transferring knowledge of
biology to artificial intelligence (Umpleby, Velle, in Mulej et al., 2000; Valle, 2003).
In 1948, Wiener defined it as a ‘scientific study of control and communication
between animal and machines’. To put it precisely, it is an interaction between
automatic controls and living beings that explains interdisciplinary approach. He
alleged it as a science of communication and control in complex systems, which are
self-repairing based on feedback. Later in 1951 its fusion is noticed between obser-
vation, decision-making and its impact on the society (Umpleby & Vallee, 2000,
pp. 353–364). Stafford Beer, recognized as father of cybernetics, has contributed to
the development of theoretical and methodological foundations (Beer, 1959).
The term cybernetics is derived from the Greek word ‘kibernetes’ that means
steersman; it illustrates how an effective system is guided under uncertainty and
within a dynamic environment (Gershenson, 2007; Prokopenko, 2009; Ay et al.,
2012). Recently, the concepts developed around cybernetics have spread to the field
of all science, humanity and beyond (Carlos et al., 2013). In last three decades,
cyberneticians focussed on key issues like cognitive capability of management, self-
organization and self-reference that developed models for intelligent business orga-
nizations (Markus Schwaninger, 2003). In recent years, cybernetics is applied to the
business management to enhance efficiency (Daniela Grieco, 2013). In a nutshell, it
is a study of the system from outside and inside, in which complexities vary with the
number of elements and interactions.
Further, Von Foerster (2003) and Jozica et al. (2006) discussed the first-order and
second-order cybernetics with the concept of observer and objects. The first-order
cybernetics focussed only on observed objects and second order focussed on mutual
interaction between observer and observed objects. Subsequently, Stuart A Umpleby,
1997 extended this concept and added that cybernetics is not only focussing the
observer, but it also focuses on ideas which takes place in the mind of the observers.
Cybernetics extended from the general observer to specific individual human thinking
(Umpleby & Velle, 2000, pp. 353–364). Cybernetic model is very useful to discover
an organizational situation and gaining the real experience of its daily life (Kunda,
1992; Wright & Shore, 1997). Cybernetics is also referred to as a system approach to
corporate responsibility of businesses (Knez-Riedl et al., 2006; Schwaninger, 2006).
This system is not intended to replace an existing one but it is used to refine it
by making it more informative and relevant (Veney & Kaluzny, 2005, p.29, p.45).
Hammond (2003) considered cybernetics as a science of synthesis.
Additionally, Stafford Beer (1979, 1985) revealed that cybernetics is a study and
design of structures, communications, roles and information systems that are essential
for the creation of workable organizations. Recent studies that are focussed on social
systems emphasized on the roles of various observers and their viewpoints (Stuart
Umpleby, 2010).
Umpleby (2010) defined cybernetics as a science of the regulation of the systems
which mainly comprises four components such as interrelated variables, sequences
of events or states, social systems with different groups and different individuals with
different ideas. Analysis of these social systems must move away from the structure
and forces the beliefs of people that are based on experiences.
Further, socio-cybernetics came into practice that blended the concepts of cyber-
netics, social aspects and system thinking with a view of considering society at large
and composed of more complex systems (Felix et al., 2003), with strong emphasis
on interactions (Gershenson, 2013). In spite of simple rules and regulatory systems,
multidimensional views system will exhibit complex dynamics (Wolfram, 2002).
According to Helbing et al., (2012) cybernetics model solves many future challenges.
Sethi (1979) initiated writing about the interaction between environment and orga-
nization responses. But the phenomenal work came from Knez-Riedl et al., (2006)
where they linked the concepts of system theory, cybernetics and social aspects of the
environment, and named it as process between humans and business organization.
Moan et al. (2008) suggested system approach for organization that takes the support
of managerial perceptions in setting the CSR-related strategies. Maani & Cavana
(2000) proposed system thinking model to cope the complexity and dynamism of
environment. Gallopin G, (2003) and Leonard A (2008) emphasized significance of
system approach and system model in structuring sustainability practices.
The concept of this research paper resides on Daniela Grieco (2013) thought
of cybernetics that is considered and recommended as a principle for refining and
substantiating management decision-making processes. In line with this, Veney &
Kaluzny (2005) defined it as a ‘popular way of defining a methodological approach
to a wide variety of scientific and management endeavours and is closely linked with
general systems theory and its application in the social organization’. It is also consid-
ered as partial monitoring of ‘communication of information in any system’ (Veney &
Kaluzny, 2005). Umpleby (2010) brought an interesting interaction between thought
and action, ‘If people change the way they think, they will change the way they
behave and if people change the way they behave, they will eventually change the
way they think, as they make their thoughts consistent with their actions’.
Research Methodology
The contemporary relevance of this case study is necessary to discuss, how India
Inc. is undergoing a transition phase in handling its CSR activity. In this situa-
tion, CSR department is seeking for the new ways and means to bring efficiency
to the system. In this work, we applied two theories to the practical case, the first
is Beer’s model of cybernetics and the second is Roome’s model of strong versus
weak sustainability. The study carried out by Basavaraj et al. (2018) applied Roome’s
model to Toyota Kirloskar Motors Limited case and proposed simple questionnaire
to measure the strong sustainability based on four dimensions. The research real-
ized that the response of this questionnaire could be represented better by using the
Tableau software. The study aims to provide a new tool for corporate CSR managers
to map their sustainability from the perspective of various stakeholders, and hence
this research work has a high contemporary relevance.
Implications of this work are relevant to managers of business organizations,
researchers in CSR domain and business school students. They can study the method-
ology used to assess the sustainability of the company based on model of cybernetics
used for a Japanese company operating in India. This case study provides a bird’s-eye
view of CSR activities and sustainability development. When CSR focuses on the
stakeholder approach it tends to ignore other dimensions which are very essential
contributors for the success of CSR. Hence, this case study research provides such
insights of holistic view of social responsibility from sustainability development
perspective.
Case study research method is adopted for this research work. Case studies empha-
size practical investigation of a contemporary phenomenon in the real-life context
(Yin, 1984, p. 23) and here the context of CSR and sustainability initiatives of TKM is
investigated. With the help of past reports and works, case studies provide exploration
and understanding of complex issues. This method is more apt for this study because
it involves in-depth holistic investigation (Zainal, 2007). One more reason for using
case study is that they use both qualitative and quantitative data and explain process
and output of the phenomenon with the help of careful observation, rebuilding and
analysis (Tellis, 1997). This methodology is followed throughout the case. Further
McDonough & McDonough (1997) category of interpretive case study research is
used for this work to interpret the available data. Roome (2012) model of cybernetics
is applied and the model is tested with Tableau. This research case also follows the
evaluative case study method by adding the judgement to the phenomenon discov-
ered in the data as opined by McDonough & McDonough (1997). CSR component
is discussed by various scholars in macro-perspective. On contrary to this approach,
CSR is studied at micro-level by focussing on one leading company.
Invesgate the Discover a proper tool to Reinforce that Toyota

theorecal model that present Strong/Week CSR/Sustainability could
describes CSR acvies sustainability approach be best described by
of Toyota of Toyota Roome's model
Fig. 1 Contribution of this case study research to the body of literature
This case study research is aimed at asking three fundamental questions that
provide transparency and functioning of CSR operations.
(1) Whether the company’s CSR activities could be looked from the perspective
of Beer’s model.
(2) Whether the company follows stakeholder model or goes beyond that.
(3) To take forward the application of Roome’s model to the Toyota India case
to represent whether company follows a strong sustainability approach rather
than a weak sustainability approach with a new tool.
Beforehand, it is necessary to ensure the extent of contribution and novelty of
this case study research to the vast literature review of CSR. The concepts that are
mentioned in Fig. 1 are studied separately by different research scholars as mentioned
in the literature review part. Figure 1 explains the contribution of this research to the
body of literature review by linking different components and applying it for the case
study research.
Such three interrelated and composite set of questions are seldom studied by
researchers in the context of Asia-Pacific. On the other hand, originality of this case
study research is the application of Beer’s and Roome’s cybernetics model to the
CSR activities of a leading Japanese automobile company operating in India. The
concept of cybernetics is used less in the context of Asia-Pacific; hence, we apply it
as a case study approach to understand the holistic view of CSR.
Research Question 1: Whether the company’s CSR activities could be looked
from the perspective of cybernetics viable systems model proposed Beer (1985).
Beer’s model explains the CSR activity process of TKML, India, it explains the
approach followed by CSR department.
Methodology
We have studied the components contributing to the CSR performance that distin-
guish TKML CSR performers from its competitors. The major implication of this
objective is that this will provide benchmark for business managers in the field of
automobile. The scope of this objective is limited to TKML India, with the collection
of data from the secondary and primary sources. Data is collected through primary
sources such as observation, structured and unstructured interviews. Secondary
sources such as website reports, sustainability reports, CSR brochures and other
published reports in newspaper. Data has been subjected to in-depth interpretation.
Toyota, India Performance in CSR
Prior to the analysis of the data, it is significant to ascertain that TKML CSR is worthy
in the industry, the following awards and honours ascertain that CSR department rated
at acceptable level in automobile industry. In 2006, the company received award from
Auto Monitor for its CSR activities. In 2009, it has received Sunday Indian State
Excellence Awards from Indian Institute of Planning and Management (IIPM) for
its CSR activities. World’s CSR congress organized Responsible Business Summit
& Awards 2013 in June 2013 at Taj Lands’ End, Mumbai, India, on this occasion
company obtained Best Community Program Award in organizational categories and
Best Responsible Business Leader in individual category. In the same year, Indian
Institute of Corporate Affairs, Ministry of Corporate Affairs has given away the
award for best use of CSR practices in automobiles sector award. In the year 2013,
the company received award under the organization categories given away by The
Chief Marketing Officer (CMO) Council under Asia’s Best CSR practices Awards,
for its community development activities. The results of these values are found in the
CSR rankings of Fortune India survey, 2012 in which Toyota secured third position in
automobiles companies followed by Tata Motors and Mercedes Benz India (Ashish
Gupta, 2014). As per Fortune India, 2013 and 2014 Toyota is recognized as India’s
most admired companies for its CSR activities. Hence, the study of Toyota, India
CSR department provides a benchmark for other players in the industry (Rajiv Bhuva,
2014).
To test first hypothesis, qualitative data analysis is used, the cybernetics viable
systems models (VSM) proposed by Beer, 1984 is applied. The model is compared
and contrasted with Roome’s model to explore the possibilities of application to CSR
functioning and later explained the CSR department structure by using cybernetics
model.
About Cybernetic Model
Prior to understanding of company CSR model, it is critical to discuss and compare

two models of system provided by Roome and Beer. The comparison of these two
models provides the basis for choosing them for this study. These two viable models
tell how a CSR system works for the company.
Roome has drawn basis for his cybernetics model from the earlier work of Beer
(1984) Viable System Model (VSM), and the major components of VSM includes
management system that performs set of action or function to make system workable.
Management system further includes homeostatic function that describes internal and
present state of the systems by foreseeing the interaction of subparts this management
system is considered more than sum of all its subparts.
Beer further observed heterostatic function that focuses on external and future
actions and enables system to adapt to the dynamic of environment. The third compo-
nent of Beer management system is identity function that recognizes and sustains
ethical standard by balancing homo- and heterostatic functions. The second compo-
nent of Beer VSM model is operational system that majorly performs operations
within the system; this system provides output by justifying their primary existence
from point of observers.
The next component of Beer model is channels that connects and interact within
system and with external environment. The final component is viability that focuses
on maintaining aspects of the system that enable people to identify and recognize
the system. The above figure compares Beer model with Roome’s model, and the
purpose of this comparison is to know which model better explains the Toyota,
India’s Corporate Social Responsibility. Basavaraj et al. (2018) comprehensively
applied Roome model to Toyota, India case, and in this section we are focussing our
study to apply it to Beer model.
The first component of Roome’s (2012) cybernetics starts with intelligence of its
top management people in terms of owning knowledge and adapting to the dynamic
situations and this component involves acute conceptualization of past, present and
future implications of their decisions. Put together it is a bundle of human resource
attributes that contribute to the success. Second component is policy that sets the
guidelines for various actions like vision, strategy and intent. The policy acts like
a bridge between intelligence of top management and control component. Third
component is control mechanism installed in the system to avoid any deviations.
The control is given in the form of instructions to various subunits to make people
accountable for the tasks that they accomplish. Generally, control mechanisms are
established in the form of targets and seeking the progress of these targets in stipu-
lated formats or reports. The intelligence, policy and control mechanism of Roome
model drawn from homeostatic, heterostatic and identity component of Beer model.
These three components represent the sensing component and provide responsive
component to the external environment.
Fourth component of cybernetics model is coordination, acts like processing part
of a system model, all the units and subunits are intertwined in an organization setup
and quality communication and concurrence act as cohesion force for value-added
activities. This component represents the operational system of Beer model that is
responsible for efficient conduct of processes.
In any system coordination cannot be implemented from the top, it naturally occurs
when various subunits of a system act and interact with each other to accomplish given
task. Final component of this model is implementation or execution of actions that
focus on adding and creating value to the system. The final component is extracted
from the operational system of Beer model that correlates with execution.
Applying Viable System Model Toyota Kirloskar Motors

Limited (TKML), India CSR
Stafford Beer proposed a cybernetic model that gives more understanding of the
key elements of functions of an organization. This model is intended to give the
clarity of system dynamics that deal with how various parts of a system act and
interact with each other by analysing the connectivity between these components.
In a nut shell, cybernetics model is the study of the system operations that make an
effective organization (Beer, 1984). This model gives insight into the functioning of
a department, its senior managers’ sense and adapts strategies to meet the demands
of external stakeholders.
Continuous improvement and respect for the people are the two main components
of the Toyota way of working. The organization structure of a company provides
clarity regarding authorities and responsibilities within the scope of their CSR
activities. This structure is a part and parcel of the complete organization structure.
Beer model provides a base-level explanation of CSR activity of Toyota India,
homeostatic, heterostatic and identity function collectively explains the local envi-
ronment and its priorities. In the case of Toyota, the local environment is considered
as village panchayat, local NGOs nodal officers that are government representatives.
The offices of Anganwadis (government run baby-sitting centre) are also consid-
ered as local and at local level major events are organized with the help of event
organization companies. In the case of Toyota CSR department, a regular interaction
and weekly meetings help to understand need of the community. Even the company
conducts need analysis through the third-party vendor.
The homeostatic internal structure can be better explained with the study of
Basavaraj et al., (2018), and this study explains the various internal structures
followed to integrate Toyota India to respond to the external environment. The
internal system is having well-coordinated structure and included different hierarchy
with specific responsibilities.
External future action involves the aspiration of enhancing plantations, construc-
tion of toilets in government hospitals and tying up with local government for commu-
nity development, adopting a greater number of schools, tying up with Anganwadis,
building more water tanks for safety of safe drinking water.
Outcome of this hypothesis: From the above qualitative data analysis, we
conclude that TKML follows specialized structured approach to manage its CSR
activities to make it excellent in the industry. CSR is executed in an organized
manner; CSR model followed explains the major components of cybernetics model
proposed by Beer and Roome. From that we conclude that Toyota unknowingly uses
the cybernetic model and the organization setup also supported the model.
Question 2: Whether Toyota follows stakeholder approach or it goes beyond that.
In the first part of this analysis, we have focussed on whether the company follows
stakeholder approach or not. At the preliminary analysis, diverse stakeholders of
Toyota are correlated with the help of other research works. According to Freeman
(1984), stakeholders are classified as internal and external. From the above Toyota
case, it can be observed that internal stakeholders are company employees and other
sister concerns. External stakeholders involve other industries in the vicinity, local
governing body, public transport department, implementing partners like NGOs, on-
site suppliers, dealers, traffic police department, environment department, health and
sanitation department, local industrial training institutes and education department.
Additionally, it is intricate to put the above stakeholders into the classification
of Walsh & North (2005) four groups of stakeholders, first and second are, respec-
tively, benefit providers and benefit receivers, third and fourth are, respectively, risk
providers and risk bearers, TKM stakeholders are mediators in conveying the benefits
to the society and all the stakeholders play their respective role in making the system
more receptive and responsive. The stakeholder approach of TKM is authenticated
with classification of Baret’s (2006) list where he identified nine types of stakeholders
for any business. The first set (of four types) are direct or internal stakeholders,
involved in a company’s day-to-day affairs, such as investors, employees, customers
and suppliers. The second set (of five types) are indirect or external stakeholders
such as state authorities, local residents, competitors, media and Non-Governmental
Organizations (NGOs). There are a wide variety of stakes related to the corporation,
such as human rights, environment and community issues, as well as other social
elements. From the above analysis, except Walsh & North (2005), all the classifi-
cations of stakeholders proposed by different researchers unveil that Toyota follows
stakeholder approach.
Donaldson & Preston (1995) recognized three core concepts of stakeholder
approach. First it is descriptive that describes company interacting with wide range
of groups with their demands and interest and the interaction is proven in this case.
Second, instrumental that explores association with CSR and other financial perfor-
mance criteria. In the case Toyota CSR is not concerned about this relationship,
finally normative that recognizes the relationship with non-contractually related
stakeholders. Our case analysis revealed that interaction of CSR department goes
beyond contractual stakeholders.
As we advanced further with our analysis from the help of interview data, we
found that company CSR goes far beyond mere stakeholder approach. The success
of Toyota depends on understanding and identifying influential stakeholders (Hart,
1995) and company with strong CSR reputation gets great support from its stake-
holders (Waddock & Graves, 1997). Managerial discretion also plays a vital role
while considering the influence of stakeholder on company’s CSR performance
(Phillips et al., 2010). Employees are at the heart of CSR at Toyota, as opined by
Mitchell et al. (1997) and employees have enough power, legality and necessity
to become most important stakeholders to management. Stakeholder management
offered a strong positive link between practice of CSR and its performance (Harrison
& Freeman, 1999).
Major differences between the stakeholders are attributed to how their influences
are perceived by the organization (Henriques & Sadorsky, 1999; Buysse & Verbeke,
2003). The interests of a stakeholder at Toyota are heterogeneous, varied and even
opposing as observed by Wolfe & Putler (2002). The entire activities taking place at
CSR department are guided by Toyota’s precepts (the Toyota’s guiding principles);
Toyota way is the foundation of its business operations. High intensity of coordina-
tion is exhibited at every value-added activity and this creates the intended result in
the company. At each managerial level, the input is provided to make the coordina-
tion more effective. Every member of the department adds value to the efficiency
of the system. Internal stakeholders contribute phenomenally to the formulation of
CSR policies, early-stage dialogues with them balances the conflicting belief of prof-
itability and social obligations related to social responsibilities and the participative
process with the stakeholders enable top management to access to the local problem
of society (Lauring & Thomsen, 2008).
Based on the initial inputs from the various stakeholders as mentioned above and
on the priorities CSR projects are taken at local, provincial or national level. Toyota’s
Asia-Pacific office provides guidelines for prioritizing activities. At each stage of the
planning and implementation, efforts are made to sustain and grow the relationship
with the dynamic stakeholders. Other than 12 stakeholders there are many aspects of
the stakeholder approach observed in Toyota’s case. First, studying and sensing the
current situation from the society around its plants, Second, Toyota places itself in
the centre and reviews the urgency, legitimacy and priorities of its stakeholders and
control its CSR based on that. Third, CSR policies are aligned with the vision and
mission of global head office and Asia-Pacific office guideline and this involves the
components of social contribution, environment sustainability, economic community
development and ethical business practices. Fourth, need assessment is done with
the inputs from pressure, legitimacy and priorities of stakeholders and further this
will result in the formulation of CSR plan for implementation. Need assessment is
set of coordination activities that allow for constant change; in other words, needs
assessment is not a once-in-a-while activity followed (as with the classic stakeholder
approach) but is a continuum of sensing changes and new intelligence gathering
activity. A stakeholders’ relationship is a dynamic process of progressive actions
and reactions (Fassin, 2009). Fifth, the intelligence of management as discussed in
Fig. 2 adds essence to CSR plan; once the plan is ready it goes for implementation
and department focus its energy to complete the targets as set. Feedback of activities
is taken on need based, generally it will be taken once in 2 years and this activity is
entrusted to a Non-Governmental Organization (NGO).
Outcome of this hypothesis: From the analysis, we conclude Toyota uses holistic
view of business in society rather than mere stakeholder view whereby it places itself
in the centre and reviews the urgency, legitimacy and priorities of its stakeholders and
manages its CSR based on that. The analysis of these coordinates reveals that Toyota
follows more than stakeholder approach, the viable model discussed above takes all
the context of cybernetics into consideration and therefore it is holistic. Holistic view
is one that takes every interrelated components of the system into consideration and
provides continuous communication to benefit its receivers, and it does not exclude
any part of the system either it is small or big.
Hypothesis 3: Toyota follows strong sustainability against weak sustainability.
In this hypothesis, we have used the questionnaire proposed by Basavaraj et al.
(2018). The questionnaire was developed considering Roome’s strong sustainability
versus weak sustainability. The questionnaire was having four dimensions with
Fig. 2 Comparison of Beer’s model with Roome model of cybernetics
the sub-dimension. The questionnaire used five-point Likert scale. The responses
of all the stakeholders such as employees, CSR beneficiaries, NGOs, government
agencies, dealers, vendors and customers are collected. Subsequently, the responses
are converted to in weighted average as shown in Fig. 3. The perception of these
stakeholders matters most for any company that concern about the sustainable
development.
A structured questionnaire is used and mapped the responses of the CSR depart-
ment executives on Roome’s system thinking model (2014). In this model, strong
sustainability assumes manager’s ability to encourage strong participation from its
environment. It involves many actors working together in an orchestral manner to
bring change and innovation in socio-ecological system that sustains production and
consumption pattern without damaging environment (Roome, 2011). Four dimen-
sions, namely, vision of change, approach to integration, complexity of innovation
and intensity of collaboration as mentioned in Fig. 3 are used to distinguish companies
from weak sustainability to strong sustainability.
Based on four dimensions three approaches are suggested and these are compli-
ance, proactive and sustainable society. In compliance approach, companies operate
with limited number of actors and innovations are focussed only for products and
services, and Fig. 3 shows the relative high position of responses of CSR executives,
which is contradictory to our assumption and the reason for this response is more
priority is given for products and services that are defect free and environmental
friendly with the close association with the limited number key players. Secondly, in
proactive approach, company involves its supply chain and includes environmental
consideration to transfer its learning, and in this case also we have received high
Fig. 3 Theoretical model proposed by Nigel Roome (2004)
position of responses leading to the conclusion that Toyota involves its supply chain
members to comply Environmental Management System such as ISO 14001. Finally,
the most desired window for strong sustainability involves a collaborative approach
where entire value chain is added and develops a shared vision that considers both
social and ecological aspects of business, and in the case of Toyota it involves entire
value chain that included suppliers to customers to execute its CSR initiatives but
innovations are not completely complex external/internal.
In our work, we have taken the questionnaire proposed by Basavaraj et al. (2018)
and modified by them little to generate good responses. We have modified the ques-
tionnaire that could be used by any other company that intend to know the perception
of its stakeholders in terms of sustainability development. We have also added few
more dimensions to the early work to make it more feasible to access SD.
Similar study has been conducted by Eric W. K. Tsang on different publicly listed
Singapore-based companies from 1986 to 1995 in the banking, food and beverages,
and hotel industries that resulted in the kind of information companies focussed
in their disclosure and shown the steady increase in the social information (1998).
More appropriate research work for this case study is drawn from the work of Pratima
Bansal that directly relates the two components to this hypothesis, that is, sustain-
ability development and longitudinal study that encompasses internal resources and
institutional factors in persuading sustainability development; additionally, this work
says the importance of media pressure in building sustainability development (2005).
A study of 159 top company in Canada from 2003 to 2006 revealed that CSR activity
can be classified as internal and external and phenomenal increase in internal CSR
activities is observed and also companies that are successful in their CSR activity
show the same contents in their websites (Basil & Erlandson, 2008). The dimensions
used in the questionnaire are as follows.
Figure 5 will help companies to know their CSR position with respect to
strong versus weak sustainability. For this objective, data has been collected from
questionnaire.
Figure 6 represents the weighted response of stakeholders; Tableau is used for
data analysis to present the above model. The red colour indicates the values of
‘EAIV-1111’ cell that represents environment concern, vision, innovation and actors
involved (refer Fig. 4). For this, window observed values are concentrated in the
left bottom corner indicating that stakeholder perceives that company gives more
priority for compliance part of SD. Red colour indicates that it is a concern for
the company, as the values at this cell need to be as less as possible. The lower
value indicates that the company gives less priority for this window. The green-
coloured stars indicate the company is showing serious concerns for the long-term
environment sustainability issues. For ‘EAIV-2222’, the values are concentrated on
the top right corner indicating that the stakeholder feels that Toyota is proactive in its
SD. For the window EAIV-3333, there is a highly scattered value indicating that the
company is perceived differently by different stakeholders in terms of sustainability
development.
On the other hand, Fig. 7 gives a clarity on the spread of rating on this multi-
dimensional model. The values in Fig. 7 have spread from 2.04, 9.20 (x, y) to 5.5,
12.0 (x, y) and only the value of x-axis is visible in the Tableau table. The second
window values are spread from 6.75, 9.0 (x, y) to 11.25, 15.0 (x, y). The spread
is also moderate compared to compliance window. The final response for sustain-
ability window spread is high, and the range is from 8.4, 12.0 to 13.5, 20 indicating
the perception for this set of questions was highly distributed.
The two diagrams comprehensively take forward the application of Roome theo-
retical model to practical case. It requires future researcher to fine-tune the approach
and make it easier and more comprehensive to collect and present the information.
As quoted by Roome, an enterprise in sustainable society approach includes activi-
ties that are perennial in nature. This approach combines social-related activities such
as community development, education and health with environmental/ecological
activities such as emission control, planting sapling and solid waste management
which has been in observed in Fig. 6.
Outcome of This Hypothesis
Baret (2006) & Lougee and Wallace (2008) argued that sustainability as a strategy
aims for long-term development in corporate competitiveness. Strong sustainability
focuses on activities that continue for many years and sustained without hampering
the ecological balance. Considering these facts, Roome’s system thinking view is
1. Company constantly seeks competitiveness through environmental sustainability

a. The company’s environmental initiatives are more related to follow the
government environmental regulations and other statutory compliances,
such as Environmental Management System (EMS) Standards.
b. Company gives equal priority to government environmental regulations
and environmental considerations for business process innovations.
c. Company gives more priority to environmental considerations in
business processes innovations.
2. Involvement of the actors during the change (innovation process). The amount
of collaboration that company establish to assess the consequences of business
activity on society.
a. The company involve customers and neighbors in producing innovations
that lead to product or process improvements. This mainly involves
negotiations in the change process.
b. The company involve supply chain members (distributors) in producing
innovations that lead to product or process improvements. This mainly
involves joint R&D in the change process.
c. Actors involved in entire value chain patterns of
production/consumption. This mainly involves partnerships &
collaborations of entire value chain in the change process.
3. Degree of innovation or complexity of innovation (new concepts that shape and
direct business)
a. Innovations are focused on internal productions and processes and are
very simple.
b. The company focuses innovations in both internal and external
processes.
c. Complex external processes – company considers CSR a form of
organizational leadership and managerial innovation. It begins with a
vision for the organization, which is developed through new concepts
that provide shape and direction to new practices (open innovations that
involves many actors).
4. Ambition of vision of change – the company introduces changes that consider
environmental concerns
a. Company emphasizes the changes in company products/processes
aligned to their impact on the social environment and their
environmental impact.
b. The company emphasizes social responsibility in issues to our partners in
supply chains.
c. Companies new technology/processes take into consideration their
environmental/social/ethical impact. Our CSR change efforts are
focused on socio-ecological systems.
Fig. 4 The questionnaire to measure sustainability development
used and state strong sustainability is to promote the active collaboration of entire
value chain in aligning social and ecological activities. From the analysis of the
model, it is revealed that the three approaches such as compliance, proactiveness and
sustainable society are incremental in nature and companies without satisfying one
level cannot move to the next level. Northwest corner indicates the area of strong
V1 V2 V3
Environme
ntal
ambition Environmental Environmental
for changes ambition for ambition for
only in changes in changes socio-
company supply chain ecological
products partners system
Environment Innovation
sustainability focused
for business complex
process external
E3 consideration EAIV-3131 EAIV-3232 EAIV-3333 processes I3
Environment
sustainability Innovation
for focused
government moderate
and business internal/exter
E2 consideration EAIV-2121 EAIV-2222 EAIV-2323 nal processes I2
Environment Innovation
sustainability focused only
for for simple
government internal
E1 consideration EAIV-1111 EAIV-1212 EAIV-1313 processes I1
Actors
involved
Customers Actors involved Actors involved
and complete supply complete value
neighbours chain members chain members
A1 A2 A3
Fig. 5 Conversion of theoretical model into practical model
sustainable responses revealed that less priority is given for complex innovations
and more priority is given to socio-ecological aspects. From the analysis of the
above techniques, it can be concluded the company is in the path of achieving strong
sustainability against weak sustainability.
Conclusion
This case study is an attempt to study the Toyota Kirloskar Motors Limited’s CSR
activities related to sustainability development. It addresses three basic questions in
the beginning of the study to gain knowledge of sustainability development-related
Fig. 6 Representation of weighted data on Roome (2004) model
CSR activities and department of TKML. The first question was to know that whether
company follows any specialized structured approach to manage its CSR activities
to make it excellent in the industry and it is proven that it follows an organized
approach to make it best in the industry. These components act as a bridge between
social pressure and sensing the environment from the analysis the study has shown
that the organizational structure criteria is an essential part that need to be in place for
making the model work. In the second objective, we have demonstrated that company
follows holistic approach in managing its CSR activities rather than mere stakeholder
approach. Finally, Tableau is used for data analysis to conclude that Toyota follows
strong sustainability against weak sustainability.
The analysis of three objectives suggests that the cybernetic model proposed by
Beer and Roome are good models to be used by companies in the context of Indian
challenges. Also, the cybernetic model explains how companies organize their CSR
than the stakeholder model by adopting holistic approach. Therefore, we recognize
that Toyota actually (un-conscience) uses the cybernetic model.
Fig. 7 The spread of data on Roome model
Limitation and Scope for Future Research
The constraints of this case study are Roome’s idea that state individual company
or any organization could not be a unit for analysis of strong sustainability to study
it as social project; in this case, we have made an attempt to analyse it within the
framework of a single company. Applying Nigel Roome’s system thinking model
into practical viable model is bit novel and experimental in this case study an attempt
was made to that extent. Future researchers can focus on covering multiple companies
and position them on the system view model to know the set of companies that follow
strong sustainability.
Cybernetics provides feedback regarding the state of the system and helps manage-
ment to regulate and control decisions (Daniela Grieco, 2013). But, cybernetics model
does not cover the feedback part that is seen in other system models. Impact analysis
and external focus are also not covered by cybernetics model with the collection of
data, and in this case we have demonstrated that cybernetic model has limitations.
The future researchers can use the questionnaire proposed here and suggest the
better way of presenting the data on four-dimensional model, and such model must
include simple way of presenting and analysing the data.
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Addressing Social Risks: The Corporate
Social Responsibility Way
Shulagna Sarkar, J. Kiranmai, and R. K. Mishra
Introduction
Our life today is surrounded by complexities like climate change, dying species, water
scarcities, financial instability, terrorism, unemployment, fatal diseases, malnutrition
and poverty which affect the current and the forthcoming generations. Some of
these issues are beyond the ability of individual countries to manage alone. When
countries keep neglecting deteriorating societal and environmental conditions, they
become the scope for development. Some of the social issues arise due to the delayed
actions of policy leaders, states, corporate leaders; organizations yet can be avoided
or addressed. Thus, there lies an equal responsibility of people and organizations to
address these social issues in some form.
What corporations should or should not do on behalf of the social good has been
discussed at length. These effects influence talent acquisition and engagement, land
acquisition, compliance, regulators role, certifications, recognition and market repu-
tation of companies. Organizations have realized that they receive a social sanction
from society with an assurance that they, in return, contribute to the growth and
development of the society.
Long-term business success can only be achieved by organizations that recognize
corporate social responsibility (CSR) as part of their core value and create a competi-
tive advantage. Global organizations by nature and vast expanse are expected to take
S. Sarkar (B)
NLC India Ltd, Chennai, India
J. Kiranmai · R. K. Mishra
Institute of Public Enterprise, Hyderabad, India
e-mail: kiranmai@ipeindia.org
R. K. Mishra
e-mail: rkmishra@ipeindia.org

https://doi.org/10.1007/978-981-16-5719-1_3
40 S. Sarkar et al.
up CSR activities addressing the social issues in its areas of operation irrespective
of the boundaries.
The United Nations Sustainable Development Goals (SDGs) as a reflection on the
shifts from the Millennium Development Goals (MDGs) is one of the prime move
for the twenty-first century for strengthening the social protection movement. The
world is increasingly becoming aware that environmental and social issues associated
with business activities can create risks to living beings. The environmental and
social impacts caused, or perceived to have been caused, by a business can result
in consequences such as production delays, negative publicity, threats to operating
licenses and unforeseen expenditures.
Social Risk Management (SRM) is a new concept which objectivizes to extend
conventional context of social protection including prevention, mitigation and coping
strategies to protect basic livelihoods by encouraging risk-taking ability (Holzmann
& Jorgensen, 2001).
The paper outlines the social issues and discusses at length the development
aspects. The paper explains the concept of social risk management and shares how
CSR programmes are a means to provide strategic advantage by managing social
risks. The paper also attempts to explain the role of government and corporate in
addressing social risks. Finally, an attempt is made to link SDGs in addressing social
issues and how CSR efforts by corporate entities impact on society.
Comprehending CSR
The new governance concept perceives government to engage in a horizontal inter-

organizational network of societal actors. History has witnessed the evolving journey
of legislation supporting social agendas. India is one of the pioneering countries
driving CSR by mandating it through introducing it as a part of Section 135 of
Companies Act (2013). India has been able to focus on its major social issues like
eradicating open defecation and sanitation issues strategically and manage it well.
Companies in India are abiding by the Companies Act (2013) while a majority of
them practice CSR to stand by law while they may not truly believe in the practice.
BRICS countries especially like Brazil, China and South Africa have initiated higher
involvement in CSR-related activities through CSR reporting, mainly to promote
the credibility, transparency and endurance of listed companies. UNDP (2006) data
reveals that it is in developing countries where the social and environmental crises are
most prominent and intensely visible in the world WRI (2005). Governments across
nations and multilateral institutions have indicated that economic development issues
cannot be separated from environmental issues (SD Report 1987).
Considering the strategic importance of CSR that infuses into the society through
various business efforts of organizations and the possible inferences, corporates are
taking necessary initiatives to conduct need-based CSR. There are various types of
industrial sectors classified on the nature of business. These industry-specific sectors
have both pros and cons associated with their existing nature of operations. Some of
Addressing Social Risks … 41
these sectors are highly hazardous to environment and society yet unavoidable due to
its importance in economic growth and future development. On the other hand, there
are sectors like some services which do not negatively impact much to the society
and at the same time stands relevant to the convenience of people in today’s scenario.
Most organizations undertake CSR activities to safeguard themselves against all
odd and hazards they cause. They do not define the role the organization has in
counterbalancing the negative impacts caused to society due to its operations, neither
involves all stakeholders as an integral part of the implementation of CSR initiatives.
There lies a huge scope for organizations to integrate CSR strategies as part of
business strategies.
Wagner et al. (2009) have elucidated CSR to be often opposing to their stated
norms of social responsibility. Graafland et al. (2003) have explained that researches
who are focussed on CSR and sustainability issues cannot generalize their findings to
both large and small companies as they tend to undervalue the differences in the rela-
tionships smaller companies have with stakeholders from those of larger companies
(Fassin, 2008; Jenkins, 2009). Barone et al. (2000) have shared that companies with
larger marketing budgets should not focus on CSR to achieve public relations goals
yet, ensure that it drives it as a means to long-run sustainability (Porter & Kramer,
2006). Though sustainability involves money, infrastructure, skills, social systems
and natural resources, the contribution to sustainability aspects is strongly based on
sustainable practices and agenda of the companies. The existence of the business is
solely based on profit, and without a profit CSR does not exist thus affecting social
development. Thus, the need for business sustainability should be an essential drive
for government in encouraging sustainability across the nation.
Most global companies are aware of the SDG goals and attempt to align themselves
with these goals (Sarkar & Singh, 2019). PWC (2015) shares that 92% of the business
community is aware of SDGs while only 71% of the businesses actually work on
plans to counter them. The data also reveals that 49% of the business community
considers that the government has a vital role in achieving SDGs. Visser (2008) stated
that CSR in developing countries is seen as a way to the fill the ‘governance gaps’
left by weak, irresponsible or under-resourced governments that fail to adequately
provide various social services like housing, roads, electricity, health care, education,
etc. There have been separate studies on CSR, CG, SDGs and Responsible Business
yet there is hardly any study which links each of them enabling inclusiveness in
understanding how these concepts can address social risks of a nation at large.
In Indian Context
CSR in India is all about involving a commitment by companies in achieving its role
in society as a producer, employer, marketer, customer and citizen apart from being
responsible and sustainable manner (Sarkar & Singh 2019). It is essential to consider
business interests of the company as primary to drive sustainable CSR or else the
42 S. Sarkar et al.
efforts will exist with the tenure, interest or personal involvement of top officials
(Gupta et al., 2006).
When attempting to understand how CSR can be executed, literature offers wide
variety of understandings. While most researches on CSR focus on limited aspects
(Maignan et al. 2005). There is hardly any work on integrative framework for the
design and implementation of CSR integrating it to the business plans, policies,
structure and culture (Bhattacharya & Sen, 2004; Smith, 2003).
The first set of CSR guidelines was released by the Ministry of Corporate Affairs
(MCA) as National Voluntary Guidelines on CSR in 2009. The MCA revised and
released the Social, Environmental and Economic Responsibilities of Business in
July 2011. The Department of Public Enterprises (DPE), GoI has shared compre-
hensive guidelines on corporate social responsibility to state-owned enterprises in
India (Central Public Sector Enterprises) in March 2010. Later, in 2011, the DPE has
released guidelines for Sustainable Development (SD). To align the SDGs, the DPE
has merged the CSR and SD guidelines and released Guidelines on Corporate Social
Responsibility and Sustainability in 2013. Considering the importance of CSR, the
Companies Act (2013) has earmarked Section 135 dealing with CSR. The section
elaborates on the various activities that the corporates could consider undertaking as
a part of CSR. Table 1 details the CSR journey and the various important agendas of
CSR in India.
Risk for Business
There are several probable negative after-effects to businesses including environ-

mental and social resulting in different intensities of impacts to varied stakeholders.
The negative impacts over a period of time starts affecting the brand of the business,
leading to dissatisfaction and anxiety among its various stakeholders. If the company
does not address these concerns on time, it may to lead to a range of financial, legal
and reputational consequences for the company (Table 2).
Social Issues Across Countries
Every society of the world has social issues unique to its time of existence. Some
of the countries suffer from extreme poverty whereas the others are surrounded by
issues of safety and security of women, rising industrial pollution, etc. There are many
countries which have issues related to water, education, health, managing waste and
food security. On the contrary, there are countries which are affected by the political
and economic issues including social exclusions. The United Nations has set goals
to end poverty and hunger as the top 2 of its 17 Sustainable Development Goals
(SDGs) for the year 2030.
Table 1 Journey of CSR in India
•Government’s Ten Point Agenda for Social Charter (workers welfare, CSR, empl,
2007 investment in skill, etc)
•MCA Guidelines
2009
•Revised Voluntary Guidelines on CSR, DPE

2010
•National Guidelines on Environmental, Social and Economic Responsibility, MCA

2011 •CSR - SD Guidelines appended in MoU
•SEBI Mandatory on Business Responsibly Report

2012
•Companies Act 2013 – Section 135

2013
•Notifications CSR and SD - Section 135

•Guidelines On Corporate Social Responsibility And Sustainability For CPSEs (DPE F No.
2014
15 (13)/2013-DPE (GM) Dated The 21 St October, 2014)
2016 • Allocation of funds to CSR for Swachh Bharat
• Swachh Bharat Kosh, Cash Ganga Fund, NRF under DPE guidelines on CSR and
2018 Sustainable
2021 •New CSR Amedment Rules, Jan, 2021
Source: Compiled by authors
Figure 1 shares the broad social issues across the world. The social issues that
have been considered are based on the work of (Ritzer, 2007). The social issues
considered are then interpreted in relation to the magnitude of the issues to the
development status of the countries.
Social Risk Management
SRM is a conceptual framework developed by the World Bank under the leadership
of Robert Holzmann which focusses on significance of risk and of risk manage-
ment instruments for poverty reduction and development. The openness of the SRM
approach to empirical validation applies equally to the rights-based approach and
the call for minimum provisions (Holzmann & Kozel, 2007). Whether the human
rights approach is the best or only feasible approach for guaranteeing basic provi-
sions for the chronic poor and for securing long-term political sustainability of social
protection must at the end be left to empirical testing.
44 S. Sarkar et al.
Table 2 Consequences for the companies due to its operations

Financial impact Legal impact Reputational impact
• Increase in costs associated • Penalties for • Loss of trades due to
with resolving erroneous non-compliance with affected brand image
operational issues environmental, sanitary,
health, safety and labour
laws
• Decreasing in asset value • Unexpected costs to legal • Lower talent attraction
due to irreversible obligations
adulteration or obsolescence
of equipment
• Low productivity due to low • Increasing damages arising • Increased attrition with
morale due to workplace from legal liability for increase in
accidents damage recruitment/induction costs
and lower productivity
• Increasing costs associated • Deferral of operations by
with meeting regulatory regulators or due to an
compliance requirements or accident or fire
payment of fines
Source Compiled by authors
EducaƟon
Water Waste
Health Food
and SOCIETY Security
SanitaƟon
PoliƟcs
Others and
Economics
Livelihood
Fig. 1 Social issues across the globe. Source Adopted from the work of Sarkar and Pingle (2018)
The social management of risks usually is based on needs of the society majorly
involving access to housing and utilities, food, health, sanitation and healthy sexual
reproduction, social security, establishing civil and human rights and consent to
social participation. Access to housing and utilities, food, health, sanitation and
healthy sexual reproduction are easily relatable, while exercising rights and social
participation is not easy due to several ills in the community where people live.
Impact of CSR Indian Scenario
There is yet a large gap in the way CSR has been portrayed in India to what the
world is aspiring for. Thus, there is a requirement for detailed study in understanding
the dimensions which can make India’s effort more aligned to global initiatives.
Some of the key elements to be studied are that the business and business associ-
ation are important and it would be interesting to understand how it impacts them
at the root level. The concept of CSR in India is in its evolving stage and there is
not much acceptance among stakeholders as there is still ambiguity in very many
areas of implementation of CSR. The guideline needs to be fully elaborative and
there is a missing element of inclusiveness. Social auditing in Indian context has
also not been encouraged much. There is still no commonly available measurement
tool to measure impact which is objectivized and comparable. Indian organizations
still rely on foreign metrics and is not be adequately localized to suite the require-
ments. Implementation of CSR initiative is more of fulfillment of accountability and
financial fulfillment. There is huge difference in the CSR spend of listed and unlisted
companies. Majority of the studies in CSR are focussed on listed companies. A total
number of 5382 companies were sent notice over non-compliance of CSR norms in
last 1 year (DNA 2017). A large portion of unlisted companies are the ones which do
not exhaust their budgets. The mandate has also created CSR bureaucracy in orga-
nizations with systems and hierarchy which is enabling diminishing internal flow of
fund leading to not to spend. A large number of smaller organizations are guarded
and protected to not spending in real needs of society rather white wash the ill effects
of the business. The CSR drive in India should be more encouraging for companies
from non-compliance to compliance mode and try to bridge the data gap in terms of
data availability and interpretation.
Times of India (2016) unfurls the impact of Section 135, Companies Act (2013)
and shares that India’s total CSR reporting increased by 27% in 2015, the maximum
among 45 countries surveyed by international audit firm KPMG. The 17 SDGs with
169 targets submit a universally agreed upon sustainable development vision for
2030 (Sarkar & Singh, 2019). Le Blanc (2015a, 2015b) has clearly explained the
need for stakeholders to collaborate in addressing the SDGs while Martinuzzi and
Krumay, on the other hand, have established associations between social responsi-
bility and sustainable development. An attempt has been made to link Schedule VII
of Companies Act (2013), SDGs and social issues existing.
46 S. Sarkar et al.
Though the Schedule VII has been drafted holistically and majorly attends to
SDGs, the challenge lies in ensuring the impact as per international standards and
goals. India has also attempted to drive the SDGs and worked on SDG India index
and dashboard (2020). There is a strong linkage among social issues and Schedule
VII of Companies Act (2013) along with SDG efforts (Table 3).
Strategizing CSR by Addressing Social Issues
Companies by the kind of its operation affect the society and nature. This is very
prominent and visible in hazardous sector as its operations are more harmful to
the environment. Though a large number of companies work to re-contribute to the
environment, a considerable number needs to address the society as their operation
affects the society too by several means. Companies need to identify the risks arising
due to nature of business and address it to the maximum extent possible. We cannot
deny the fact that every business in some ways affects the society. These effects
can be classified majorly as incident effects referring to the effects that are directly
related to the event and disappear after a relatively short period of time. The other
major category being lifetime effects which are related to risks that usually have a
long-lasting effect on a persons’ life. The challenge lies in identifying the initiatives
that can be undertaken to mitigate the hazards caused. The CSR initiatives can be
introduced in a manner which either nullifies the negative effects or enhances the
reputation of the company and increases its business opportunities (Fig. 2).
Role of government in addressing social risks: The role of government in
addressing social issues is very crucial as the government is expected to create an
enabling environment for raising awareness and stimulating public debate for the
existing social challenges and issues. The government alone cannot make a differ-
ence to the society and thus is expected to include more actors in society for defining
policies addressing social issues also encouraging business responsibility in dealing
with the social issues. The government is also expected to build capacities of busi-
nesses, civil societies and public authorities; fund researches related to social devel-
opment and engage in public–private partnerships for larger social impacts. Social
issues can be addressed by initiating structured and sustainable efforts in the form
of CSR and the government can act as a facilitator to undertake strategic, structured
and impact-oriented CSR.
Role of corporate in addressing social risks: The roles of corporate in addressing
social issues primarily lie on first understanding the initiatives undertaken by the
government and then design CSR initiatives which are based on real needs in align-
ment to the government’s effort. The corporate effort should not be in conflict with the
government. The role of corporate is majorly to dovetail the efforts of the government
either by supplementing or complimenting the efforts undertaken by government.
Some initiatives that can be undertaken addressing social risks are providing oppor-
tunity for skill development, initiating new business chains to create opportunity
Table 3 Addressing social risks through SDG and Section 135 of companies Act (2013)
Social risks Schedule VII, Section 135 of SDG
Companies Act (2013), India
(adopted from www.mea.gov.
in)
Food security Water Health and (i) Eradicating hunger, poverty SDG 1, 2, 3 and 6
Sanitation and malnutrition, promoting
health care including
preventive health care and
sanitation including
contribution to the Swach
Bharat Kosh and making
available safe drinking
water
Education (ii) Promoting education, SDG 1, 2, 4, 8
including special education and
employment enhancing
vocation skills especially
among children, women,
elderly and the differently abled
and livelihood enhancement
projects
Equality and upliftment of (iii) Promoting gender equality, SDG 1, 5 and 10
marginalized society empowering women, setting up
homes and hostels for 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
Waste Water (iv) Ensuring environmental SDG 6, 7, 9, 13, 14, and 15
sustainability, ecological
balance, protection of flora and
fauna, animal welfare,
agroforestry, conservation of
natural resources and
maintaining quality of soil, air
and water including
contribution to the Clean Ganga
Fund setup by the Central
Government for rejuvenation of
river Ganga
(continued)
48 S. Sarkar et al.
Table 3 (continued)
Social risks Schedule VII, Section 135 of SDG
Companies Act (2013), India
(adopted from www.mea.gov.
in)
Maintaining culture and social (v) Protection of national SDG 9, 12 and 13
traditions Others 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 art and
handicrafts
Equality and upliftment (vi) Measures for the benefit of Goal 10
armed forces veterans, war
widows and their dependents
Maintaining culture and social (vii) Training to promote rural
traditions sports, nationally recognized
sports, paralympic sports and
olympic sports
Equality and upliftment of (viii) Contribution to the Prime Goal 1, 2 and 10
marginalized society Minister’s national relief fund
or Prime Minister’s Citizen
Assistance and Relief in
Emergency Situations Fund
(PM CARES Fund) or any
other fund set up by the central
govt. for socio-economic
development and relief and
welfare of the schedule caste,
tribes, other backward classes,
minorities and women
Others (ix) Contribution to incubators SDG 7, 9, 11 and 12
funded by Central Government
or State Government or any
agency or Public Sector
Undertaking of Central
Government or State
Government, and contributions
to public funded Universities
Food security Water Health and (x) Rural development projects SDG 9
Sanitation Education
Food security Water Health and (xi) Slum area development SDG 11
Sanitation Education
Effects of Social Risks
Incident effects Lifetime effects

Risks that usually have long
Effects that are directly related to lasting effect on a persons’ life.
incidents disappear after a An event can first lead to incident
relatively short period of time. effects, but later in lifetime may or
may not lead to inter-generational
result.
Social Responsibility Sustainability

efforts efforts
Business
Sustainability
Fig. 2 Effects of social risks. Source Compiled by authors
for employment and creating awareness on various health and hygiene dimensions
(Tables 4 and 5).
Types of Social Risks
Social risk management goes beyond public provision of social protection and draws
attention to informal and market-based arrangements, and their effectiveness and
impact on growth and development. Risk can be defined as the possibility of suffering
harm or loss (Rovins et al., 2015). Managing and controlling risk internally and
externally is the key to running a successful organization.
Corporate branding, governance and ethics are issues accompanied with CSR and
have gained more limelight compared to more needed themes of discussions. Risks
associated with vendor management and supply chain, human rights and its abuses,
or industry-specific risks such as operational risks, pollution and damage to nature
like oil spills are given less prominence. Even though large discussions happen in
great forums, yet it does not get to the grass-root level and this covers what society
demands of a business in the twenty-first century.
50 S. Sarkar et al.
Table 4 Role of government and corporate in addressing social risks

Social risks Governmental initiatives Corporate CSR initiatives
Incident based • Creating an enabling environment • Define need-based CSR addressing
for raising awareness and community issues
stimulating public debate on • Provide opportunity for skill
encouraging new avenues development essential for industries
and also ensuring future
employment
• Defining policies for addressing • Initiating new business chains to
issues arising create opportunity for employment
of needy
• Undertake CSR efforts which
addresses any national emergency
like COVID-19 or disasters, etc.
Lifetime • Enabling quality infrastructure for • Supplement and compliment the
health and hygiene initiatives of the government
• Stimulating policies for • Undertake CSR efforts which create
discouraging of products like awareness against the causes to
tobacco, alcohol, drugs, etc. health-related issues
• Promoting awareness among all • Undertake CSR efforts towards
members in the chain for ensuring sustainable development
health system of the country
• Enabling a sustainable environment
addressing all social and
environment
Table 5 CSR interventions addressing social risks

Categorization of social risks Explanation CSR
interventions—examples
1 Universal risks • Shared by all irrespective • Road safety, safety and
of their age, gender or security against terrorism,
position in society natural disasters
• It is imposed on all yet not management, environment
to same extent degradation. Water and
food security
2 Life-cycle risks • Shared by all • Health initiatives of old,
children and women
• However specific to a • Awareness initiatives
specific age or to exclusive towards health and
life stages sanitation
3 Categorical risks • Class or group risks • Settlement initiatives
• Distinctive to specific towards minors, women,
groups in the society under-privileged, children
or below poverty line
An attempt has been made to share the case studies in various areas of risks
associated with livelihood, health and social issues (Mishra & Sarkar, 2017).
Corporate Case—Addressing Livelihood Risks
Neem Project of Gujrat Narmda Valley Fertilizers

and Chemical Limited (GNFC)
In this project, GNFC Neem Oil is prepared along with Neem cakes. The material
for the same is collected through local women of SHGs from around 4000 villages.
Around 2200 neem seed collection centre has been set up in 22 districts of the village.
Local women were trained to collect the neem seed which is available only during
July–August. The project generated 12–15 Cr income for 1.25 lakhs women as well
as created indirect employment for around 50,000 rural people.
An impact assessment study by UNDP clarified that the project led to increased
income, reduction in migration and enhanced decision-making role of women in
their families. The study also reflected that asset creation in form of livestock as well
as stoves increased. The women empowerment initiated also addressed the typical
issue of domestic violence in villages and reduced it by a considerable percentage.
Corporate Case—Addressing Health Risks
Anti-Tobacco Initiative of Bajaj Electricals, Mumbai Named

‘Yes to Life and No to Tobacco’
Tobacco is not just harmful to health but to environment. It causes soil pollution
and fertile lands by clearing tress are used for tobacco cultivation. The anti-tobacco
policy of the company applies the 5 As—Ask, Advice, Assess, Assist and Arrange.
The anti-tobacco drive was taken in with project partner Salaam Bombay foundation
where the initiatives were taken to increase awareness, empowering school children
to refuse tobacco products, building capacity for local stakeholders and engaging
policy-makers. The mass media outreach initiative included World No Tobacco day
campaign through Mumbai Dabbawalas, World No Tobacco day campaign with
Mumbai BEST transport and World No Tobacco day campaign with Mumbai Police
personnel.
The outcome of the initiative was 250 Mumbai police took a pledge against
tobacco and agreed to pass on the message. 1000 dabbawalas reached the message
to 1 lakh population of Mumbai. Thousands of Zilaparishad schools of rural area
52 S. Sarkar et al.
of Yavatmal and Wardha were made tobacco free. This is continuous effort and the
impact will be seen over a period of time.
Corporate Case—Strategizing CSR Addressing Social Issue
School Hand Wash Programme of Dettol
Health and hygiene is an issue in rural India. Most rural population does not go
for hand wash using soap till date. Sadly, in India, 1 lakh children die annually
from preventable illnesses such as diarrhoea and some of those deaths could have
been halted through the very simple act of hand washing with soap. Dettol took an
initiative of creating awareness of hand wash using their own products. Dettol is one
of the top 10 trusted brands in India which has completed 75 years of its existence in
India. Dettol started ‘School Hand wash Program’ with the help of SHARP NGO to
spread the good hand washing habits among school children in India. Maintaining
hygiene being the main motto as it stood for ‘trusted protection’ ensured a pledge
for all students covered under this programme to wash their hands properly and
further communicate the same to their families and community. Posters of six steps
of hand washing were also displayed near the washrooms and drinking water sources.
‘Dettol 100% attendance’ award was given to students with 100% attendance. All
the schools were also given a First Kit to the school and Dettol hand wash dispensers.
The message has been passed to 1.1 million students across 3000 schools.
Conclusion
CSR has emerged as an important tool which the companies use to fulfill their social
responsibilities through their business activities. The emergence of new form of social
risks cannot be mitigated through traditional means. The ever-changing environment
requires innovation by companies in both sensing and understanding these risks.
CSR needs to address the risks by addressing the real needs of the society. The role
of corporate lies in identifying the real needs and design CSR initiatives addressing
social issues arising out of their own operations and then cater to other social issues.
Molson Coors, a worldwide known beer company, initiated a technology-oriented
initiative working against ‘Drunken driving’.
The company’s responsibility lies in identifying social issues and defining the
needs of the society. Identification of right partner for implementation, monitoring,
evaluation and impact assessment is also integral to the success of the initiatives. The
initiative of the government in the form of Companies Act (2013) has already led
the pathway for development but challenge lies in encouraging corporate to follow
the true spirit of CSR and initiate needed, sustainable and scalable efforts for future
development.
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Can CSR Help Address Farmer
Suicides? An Indian Case Study
Subhasis Ray
Introduction
It is estimated that around 16,000 farmers commit suicide every year in India
(Merriott, 2016). In a world of sustainable development and progress, it remains
a black spot for one of the largest economies of the world. Agriculture contributes
to 15% of the country’s GDP (PRS, 2020) and is the backbone of the country’s
food security. 85% of India’s 96 million farmers are considered small and marginal
(LTFS, 2020) and formed a majority of those who took their own lives every year.
Farmer suicides in India have attracted attention from policymakers, researchers and
the government not just for the sheer tragedy of the events but also their implica-
tion for India’s growth and development. While the economy has shown remark-
able resilience since the 2008 financial crisis and is staging a recovery in the post
pandemic world, there is no evidence that a lot of farmers has improved on the
ground. India, through the Companies Act 2013, has been one of the few coun-
tries in the world which mandated companies to spend 2% of their average profit
on community development projects. In theory, such projects should go a long way
to develop innovative solutions to local problems. However, to date, there has been
no independent study to understand how good such corporate-funded projects are
in answering the pressing problems of society. In this chapter, I look at an innova-
tive CSR project, Jalvaibhav (meaning water abundance in Hindi), undertaken by
L&T Financial Services (LTFS), a leading Indian financial service company. The
project builds on Integrated Water Resource Management (IWRM) and Climate
Resilient Agriculture (CRA) with the purported aim of helping farmers come out of
their perpetual misery by improving the water situation. Maharashtra is one of the
S. Ray (B)
Xavier Institute of Management Bhubaneswar, 4/19 XIMB Campus, Xavier Square, Bhubaneswar
751013, India

https://doi.org/10.1007/978-981-16-5719-1_4
56 S. Ray
epicentres of agrarian distress in India including high rates of farmer suicides. Liter-
ature on farmer suicide and consumer vulnerability provide the theoretical backdrop
against which the project is analysed to draw a preliminary conclusion about the role
of CSR in helping farmers avert a crisis and not taking the extreme step of taking
their lives. This study shows that, on its own, the Jalvaibhav project is remarkable
for its scientific approach in addressing the water issue but misses several important
questions raised by researchers studying the farmer suicides in India.
Background
Climate Change, Water and Agriculture in India
The increasing population and unpredictable climate are taking a severe toll on
India’s water resources. Indian agricultural output provides food for 17.5% of the
global population using only 2.4% of land and 4% of global water resources (LTFS,
2020). The water situation in India is gradually worsening with 54% of the country
facing decreasing groundwater levels and high water stress. Farmers depend on water
and small farmers rely on rain-fed agriculture, making them the main victims of
the vagaries of climate. Lack of regular rainfall also leads farmers to overexploit
groundwater leading to permanent shortage and crisis during drought. Between 2002
and 2017, there were 13 droughts, and land degradation was in excess of 29% between
2011 and 2013 (LTFS, 2020). India is expected to be the worst hit in terms of climate
change among South Asian nations. Extreme weather reduces crop productivity and
farmer income. This in turn pushes farmers to debt traps which are difficult to avoid
and get out of.
Two global initiatives to tackle the problem of water and agriculture have drawn
the attention of stakeholders: Climate Resilient Agriculture (CRA) and Integrated
Water Resource Management (IWRM). CRA aims to improve resilience against
climate-induced uncertainties by promoting sustainable agricultural practices like
shifting to high-value crops but also considers off-farm options like livelihood diver-
sification. IWRM, promoted by the UN Global Water Partnership, works on the
area of improving water access by creating better water storage and usage practices
including watershed development, rainwater harvesting and building tanks and water
bodies. It has been defined as ‘A process which promotes the co-ordinated develop-
ment and management of water, land and related resources, in order to maximize the
resultant economic and social welfare in an equitable manner without compromising
the sustainability of vital ecosystems’ (LTFS, 2020, p. 22). The Jalviabhav project
uses both IWRM and CRA to address the farmer distress in the region.
Can CSR Help Address Farmer Suicides? … 57
Farmer Suicides
More than 250,000 Indian farmers committed suicide from the mid-nineties to 2014
(Sadanandan, 2014), pointing to major rural distress in India. Farmer suicide points to
significant development challenges in the agricultural sector. Farmers are responsible
for the nation’s food security and farming provides livelihood to a large part of
India’s population. In the current context, LTFS’s CSR project is aimed at Integrated
Water Resource Management and Climate Resilient Agriculture in a state and area
which has a high rate of farmer suicide. The premise of the Jalvaibhav project is
that improved water management and climate resilience will lead to better crop
productivity, increased income and hence sustenance for the farmers in the region.
CSR Performance
The Indian government defines corporate social responsibility as a strategic approach

where profit-making companies, going beyond philanthropy and mere compliance
with the law, use a part of their profit for common social good (Ministry of Corporate
Affairs & Ministry of Public Enterprises, 2015). Section 135 of India’s Company Act
2013 mandates CSR for companies with a minimum threshold of revenue and profit,
asking them to contribute 2% of their profit on community projects. This resulted
in more than 20,000 companies spending INR 13,465 crores on CSR till March 31,
2017 (Srinivasan & Srinivasan, 2019, p. 20–21). Maharashtra, the state under focus
in this chapter, received the highest amount under CSR till this period. Money spent
on CSR covered all possible developmental sectors: Education, environment, gender
and health were the top four sectors in terms of CSR expenditure. One question that
remains to be answered is ‘How well/effectively could a CSR intervention solve
a social/environmental problem?’ While impact assessment studies or evaluation
studies, generally commissioned by companies, provide some directions in relation
to a particular project and its pre-defined objectives, it is not clear if the problem of
hunger, poverty or water can be solved by CSR, as such issues have both historical and
systemic challenges which may be beyond the scope of corporate-funded projects.
L&T Financial Services
LTFS was incorporated as a non-banking finance company in 2006 and listed on the
Indian stock exchange in 2008. It is promoted by Larsen & Toubro, a respected engi-
neering and infrastructure company in India. The company operated in several areas
of the financial sector, including infrastructure finance, financial advisory service,
rural finance and mutual funds. It had more than 15 million customers and 22,000
employees (www.ltfs.com) at the time of writing this chapter. CSR in LTFS focussed
58 S. Ray
on the marginalized and vulnerable population of the country through projects in inte-
grated water resource management and digital financial inclusion to ensure a sustain-
able livelihood. The projects were designed in a way that ‘final ownership rests
with the community thus ensuring long-term sustenance’ (https://online.ltfs.com/
csr/#p=7). The CSR approach of the company rested on the 3S framework—social
impact, scale and sustainability-which would ultimately lead to stakeholder value
creation. In order to ensure the right social impact, CSR projects were designed with
careful consideration—baseline surveys and stakeholder workshops were carried out
and clearly defined output, outcome and impact were identified. To adequately scale
the projects, CSR project partners (NGOs) were chosen after a due diligence process.
To ensure that the community does not become dependent on CSR funds, commu-
nity participation and involvement were ensured. For example, in the Jalvaibhav
project, this meant involving communities in digging and burying trench for water
conservation.
Review of Literature
Farmer suicide has been a sensitive topic in India given its implication for rural, small-
holding farmers, states, corporates and national government. The Indian economy
relies on agriculture for its growth and more than half of its population depend
on farming (Chinnasamy et al., 2019). Thus farming and farmers are central to
the country’s food security and global position. Yet, India has, one of the highest
national averages for farmer suicides in the world. Several researchers have studied
the phenomenon. This section highlights the key findings across the literature. The
purpose is to understand possible reasons for such acts, develop a general under-
standing of the problem (and solutions) and then examine if and how CSR projects
can play a role in addressing such problems.
Farmer suicides are concentrated in certain parts of India and the states of Kerala
and Maharashtra have the highest number of such suicides (Basu et al., 2016). Several
causes have been put forward as possible reasons for farmer suicide in India. At the
macro level, agricultural trade reforms in the 1990s have been blamed for much
of the rural distress seen in India. Liberalization of the sector in the 1990s led to
an agrarian crisis that proved fatal for small, poor, cash crop cultivating farmers
(Kennedy & King, 2014) though this remains contested to this day. Globalization
had led to the corporatization of agriculture and extreme vulnerability for the farmer
(Sadanandan, 2014; Shiva, 2004; Shiva et al., 2000). The global capitalist system
has little concern for small farmers in developing countries and creates pressure on
the local economy and its actors engaged in community-level production, a pressure
that often leads to suicides. Given the nature of this capitalist economic system,
states (national or regional governments) have little power to help small farmers in
a significant and sustainable manner (Das & Kumar, 2014).
Multinational seed companies penetrated the Indian market with low-cost seeds
that eliminated the local seed variety and banks (Shiva et al., 2000) Over a period of
time, farmers using such costlier seeds (made available by corporate marketing) had
to depend on increasing quantity of pesticides and fertilizers to retain productivity.
While the cost of farming increased, access to finance was reduced, with banks
deciding to lend to other sectors which further compounded the crisis.
Several researchers have specifically pointed out the possibility of Bt (Bacillus
thuringiensis, promoted by the multinational company Monsanto) cotton and geneti-
cally modified crops as one of the possible reasons for the high rate of farmer suicides
(Gruère & Sengupta, 2011). Monopolization of genetically modified seeds, aggres-
sive marketing of companies and increased input costs are some of the reasons causing
desperate farmers to commit suicide. The relation between seed monopolization and
farmer suicide has been contested but never disproved conclusively. The fact that
farmer issues are heard only during election times has created further complications
(Plewis, 2014; Thomas & Tavernier, 2017). Suicides have become political tools in
the hands of media and politicians, often losing their credibility due to lack of local,
grounded studies (Münster, 2012). Later in this chapter, I will point out that it is
now another market force, CSR (budget determined by profits) by large companies,
which is trying to solve this problem created by globalization and marketization.
Some researchers have pointed out that suicides could also be due to mental
health patterns among farmers who have found it increasingly difficult to accept
lowering agricultural productivity given their high aspirations (Mohanty, 2013) in
a globalized, high growth world. There is increasing evidence that historical socio-
economic factors among the lower and middle caste smallholder farmers along with
neoliberal measures lead to such tragedies (Mohanty, 2005).
There has been another strand of literature in this area that looks at natural condi-
tions that make life difficult for farmers (Chinnasamy et al., 2019). For example, areas
with poor groundwater storage facilities and practice may face more difficult situa-
tions during a drought. Climate change has contributed to the crisis with increasing
rates of land degradation and desertification. Access to irrigation water is another
additional factor. In times of water shortage this access, mediated by politics and
power, could stand between the life and death of the farmer. It should be mentioned
that the quality of data provided by the government, for example about groundwater,
is neither good nor available for public verification (Chinnasamy et al., 2019). Better
data on groundwater status and storage can help in mitigating this crisis. Low rainfall
and rising temperature are two main natural reasons for crop crisis but areas with
good irrigation water access are able to manage such shocks better (Barve et al.,
2019).
Are suicides cases of individual farmers succumbing to life’s unsurmountable
challenges (Bhattacharyya et al., 2020) or failure of systems and processes supposed
to protect the fundamental right to life of Indian citizens? Evidence from several
Indian states shows that more than ‘mental disorder’, it is the socioeconomic distress
that makes farmers take their lives. The National Crime Records Bureau’s 2014 report
(NCRB, 2014) points out factors like indebtedness, bankruptcy and crop failure as
reasons for suicides. They may be immediate triggers but such triggers are caused
by macroenvironmental pressures. I believe neither of them can be ignored, and
one (systemic failure to provide credit, inputs and skills) exacerbates the other as
60 S. Ray
the individual is processed by societal challenges and the (in) ability to tackle such
challenges (individual propensity to commit suicide). The state needs to do more
(Rao et al., 2017) rather than paint marginalized farmers as mental patients.
Some studies have suggested solutions related to processes, systems, enhanced
self-esteem, self-organization, the role of states and new methods of agriculture like
organic farming (Mariappan & Zhou, 2019) or zero budget natural farming (Meek &
Khadse, 2020). However, it can be said that the problem of farmer suicides continues
to question India’s national narrative of a new global power on the rise.
Summing up, existing literature has identified several causes of farmer suicides
in India: policy reforms, corporatization of seed–fertilizer–pesticide market, lack
of credit, historical shortage of water, cropping pattern, landholding pattern, and
climate change-induced crop failures and mental make-up of vulnerable farmers.
Recommendations and solutions focus on policy change, increased state support,
more knowledge and measures to address the problems listed above. I have not
found any significant literature barring a few (Glover, 2007) that focusses on CSR
efforts to address the issues in general and farmer suicide in particular.
Research Question, Method and Data
Keeping this research gap in mind, this chapter poses the research question, ‘Can CSR
address the problem of farmer suicides?’ To answer this question, I use a qualitative,
exploratory approach using the case study of LTFS’s CSR project, Jalvaibhav. The
case study method is suitable for emerging phenomena situated in unique contexts
(Yin, 2017). The case selection can be justified in the following ways: Maharashtra
has one of the highest farmer suicide rates in India, highest CSR expenditure among
Indian states (Srinivasan & Srinivasan, 2019) and hence provides the right context
to study farmer suicide. LTFS is one of the top five financial service companies in
India and one of the few companies to publish about their CSR along with a social
impact assessment study. Moreover, its CSR project targets improving agriculture
and farmer lives and livelihoods, providing us with the possibility of studying the
role of CSR in addressing farmer issues including suicides.
Data for the case study was collected from the company website: LTFS CSR
reports, project report on Jalvaibhav and social impact assessment study report. The
three documents, available on the company website, are prepared by LTFS itself,
partially audited by the consulting firm KPMG and Thinkthrough Consulting Private
Limited, respectively. Relying on secondary sources provide a significant method-
ological challenge. However, due to the COVID-19-induced pandemic and travel
restrictions, it was not possible to travel to the project sites for observation and inter-
view of stakeholders. The use of secondary data for topics like those covered in this
chapter has been approved in several cases in business research.
Jalvaibhav Project
Integrated Water Resource Management and Climate Resilient Agriculture form the
policy basis for Jalvaibhav. Maharashtra faced severe droughts in 2014–20015 and
this acted as a trigger for LTFS to think of the Jalvaibhav project in the Marathawada
region. The five districts—Beed, Jalna, Aurangabad, Osmanabad and Latur—were
together called Marathawada and were infamous for farmer suicides. The project
focussed on these five districts as well as two other highly affected districts. From
these regions, eight suicides were reported per day from 2015 to 2018, the highest in
India (LTFS, 2020, p. 31). Marathawada faced a severe crisis and high vulnerability
due to water shortage, desertification and climate change. The region is remarkably
low in soil nutrients like nitrogen and phosphorus. Soil health is an integral part
of high crop productivity. Soil requires micro-nutrients like carbon and phosphorus
as well as optimum moisture levels to prevent desertification. Frequent droughts
and dryness lead to degraded soil health. On the other hand, soil pollution happens
through the accumulation of heavy metals from fertilizers, insecticides, pesticides as
well as industrialization. Chemicals in agriculture increase short-term productivity at
the cost of long-term loss of soil health. Chemical-induced agriculture leads to loss of
good quality soil, forcing farmers to buy more fertilizers and pesticides and leading
them to debt traps and finally suicide. The drought-induced scarcity meant farmers
sometimes making tough choices between crops and livestock and also sinking deep
borewells to get water. Thus Marathawada was an ideal choice to implement IWRM
and CRA for LTFS.
The objective of the project was to build water-bearing structures and in the
process improving resilience to climate-related hazards like droughts. The focus
was ‘to strengthen the resilience and adaptive capacity of the rural communities to
natural hazards’ (LTFS, 2020, p. 30). The project was spread across four districts of
Maharashtra, 62 villages and 30,000 farmers (https://online.ltfs.com/csr/#p=10).
Program Design
LTFS identified five major problem areas: (a) Erratic rainfall, (b) low agricultural
production, (c) scarcity of drinking water, (d) degraded soil caused by frequent
droughts and (e) migration due to decrease in household income. The method-
ology adopted to address the problems included watershed management, community
ownership and sustainability and convergence with government schemes. Key indi-
cators of success identified were: increase in area under irrigation, water availability
and household income. The key steps in the project were the selection of geography,
due diligence and selection of NGO partners, baseline assessment, co-creation of
infrastructure, implementation and social impact assessment.
The project involved developing water resources, improving agriculture and
building the capacity of local farmers. IWRM’s global practices included (a) soil
62 S. Ray
and water conservation—building check dams, bunds, de-siltation, (b) improved

agricultural practices—replacing seeds, water-efficient irrigation, improving soil
carbon, water budgeting and reduction of external inputs and (c) stakeholder
engagement—building capacity for better agricultural techniques, using common
resources and governance mechanisms. Jalvaibhav replicated these practices by
constructing earthen bunds, water accumulating deep trenches, cement bunds and
similar water-bearing or directing structures.
Farmers were empowered through Farmer Field Schools, promotion of CRA and
integrated pest management and organic fertilizers, alternative livelihoods and devel-
opment of audio-visual aids. Farmer schools comprised 20–25 farmers and were led
by a farmer from the village. ‘Demonstration Plots’ were prepared to demonstrate
new techniques of water storage and farming. The schools created a platform to
organize farmers and imparting knowledge and also sharing other relevant agricul-
tural news and techniques. CRA practices introduced included water budgeting, seed
treatment and soil health improvement techniques. In terms of alternative livelihoods,
drumstick and fruit plantation was promoted. Several community institutions were
built or consulted in implementing the project. This included Agriculture Develop-
ment Committee and Water User Group. The Agriculture Development Committee
facilitated village-level promotion and implementation while the Water User Group
comprised beneficiaries who were in close proximity to water structures. By FY
2019–20, the Jalvaibhav project reached seven districts and 60,000 beneficiaries.
Impact and Challenges
A social impact study commissioned by LTFS for the Beed district shows an increase
in water storage capacity through watershed structures, an increase in groundwater
level by 1 m and additional 200 hectares of land came under irrigation. Overall,
the company reports positive outcomes on several fronts—groundwater level, crop
acreage, area under irrigation and household income as well as ‘improved brand
recall of LTFS among community’ (LTFS, 2020, p. 53). Some challenges reported
include rural migration, local politics and election, unavailability of labour and land
and general reluctance to implement efficient structures. It is not known what sort
of challenges LTFS might have faced within its own organization as well as with
collaborating NGOs.
Discussion
A large corporate house like LTFS taking up a CSR project in one of the most
agri-distressed regions of India provides us scope to examine if such initiatives can
address critical issues like farmer suicide. To answer our research question, we use the
existing literature on farmer suicide and the theoretical lens of consumer vulnerability
(CV). The concept of CV (Hill & Sharma, 2020) originated in marketing to explore
how markets and marketing create vulnerability and how such vulnerable consumers
cope with their life. It can be defined as ‘a state in which consumers are subject to
harm because their access to and control over resources is restricted in ways that
significantly inhibit their abilities to function in the marketplace’ (Hill & Sharma,
2020). Farmers are consumers of agricultural inputs, public goods as well as CSR
services provided by companies. Thus they provide a suitable context to examine the
efficacy of CSR in alleviating their poverty and addressing the several vulnerabilities
they face. The CV approach is a bottom-up perspective that examines powerlessness
at the individual, interpersonal and structural levels (Sharma & Keller, 2017; Smith
& Cooper-Martin, 1997). CV thus provides a way to address specific risks of harm
and powerlessness of consumers and assumes that consumers have the potential
to be both passive and active agents navigating the consequences of vulnerability.
Examining the Jalvaibhav project based on the (a) established reasons for farmer
suicides and (b) lens of CV provides us with a way to understand the possibility of
such projects helping in saving farmer lives. Experienced or observed CV has three
components (Hill & Sharma, 2020): (1) Antecedents of vulnerability arising out of
(a) lack of resources and (b) lack of control over resource usage, (2) Contexts of
vulnerability which are individual in nature and (3) Consequence of vulnerability
which could be either non-defensive coping (like committing suicide) or defensive
coping (like transcending or rebelling or creating new structures).
A review of literature provides possible reasons for farmer suicides at three
levels—policy, practice and personal. Policy reforms, globalization and corporatiza-
tion of agriculture have created vulnerability in the first place. This in turn created
practice-related issues—seed monoculture, cash cropping, reliance on fertilizer and
pesticide and consequent debt trap. At the personal level, the aspiration of tradi-
tional farmers and the inability to produce enough created tensions. Analysing the
Jalvaibhav project, it is clear that the CSR intervention was targeted at the practice
level only—building water storage structures, teaching water budgeting and devel-
oping alternative livelihoods are all practical practice-level steps that the project
targets and achieves. However, not answering the market and policy-level issues
mean that such practices are bound to be short term and possibly dependent on
similar companies’ goodwill and CSR budget. It is ironic to note that it is now the
market (CSR budget being determined by the profit made by a company) that is
trying to remove the distortions caused by it in the first place. Second, as several
researchers point out, there is a personal, mindset angle to farmer suicides that need
to be addressed. While all farmers face a similar crisis, some decide to take the
fatal step. The Jalviabhav project is silent on this front too. While existing literature
is unequivocal that access to credit and consequent debt trap is one of the major
reasons, the project does not address this directly. For example, how does a farmer
get access to money from financial institutions rather than from local loan sharks? It
is obvious that LTFS wants to fill this gap and expand its market share (as noted by
KPMG in its report) but the Jalvaibhav project does not directly answer this question.
The Economic Survey published by the Government of India notes that doubling of
64 S. Ray
farmer income can happen through better credit access, crop insurance, farm mecha-
nization, better food processing capacity and market creation for farm outputs (PRS,
2020). The Jalvaibhav project, however, has also given the market angle a miss.
From the lens of CV, its antecedents, contexts and consequences as described
above, the Jalvaibhav project addresses only one aspect of consumer vulnerability—
lack of resources (like water, knowledge about better agricultural practices) and that
too, partially. It is silent on how can we increase control of farmers over resources
by overcoming individual, interpersonal and structural restrictions. It is silent about
the individual contexts (financial, social and racial) that make some farmers re-act
differently than others when faced with a crisis. Finally, the project does not focus
on the consequences of vulnerability in terms of coping mechanisms. How do we
enable farmers to cope better with climate change, lack of water, increasing prices
of inputs, middlemen, loan sharks and the nexus among them?
Srinivasan & Srinivasan, (2019) point out that within corporates CSR projects do
not create any learning or understanding about approaching a development project.
While there is skill and efficiency in getting the projects done, the corporate is not
impacted by the development process nor it is interested to understand how it got the
result. A study of the current project over time will be able to tell if this is also true
for LTFS.
By combining literature on farmer suicides and consumer vulnerability and exam-
ining them in the context of India’s mandated CSR, this chapter makes a contribution
in understanding how far and how much CSR projects can go in addressing deep
problems in society. It concludes that CSR projects are useful in the short term in
improving farming practices but fall short of addressing policy issues and personal
challenges that together lead to the suicide crisis.
Limitation and Future Research Direction
There are several limitations to this study, the primary being data source. This chapter
relies on the report prepared by LTFS documenting its work. Written during the
COVID-19 pandemic, it was not possible to travel to Marathawada to observe and
interview various stakeholders involved in the project. Nor will we be able to conclu-
sively comment on the effectiveness of the Jalvaibhav project till government figures
on farmer suicides are published which may be a few years away. Yet, I believe that
the study gives one the scope to reflect on the extent and constraints of mandated
CSR in addressing pressing challenges faced by India.
Conclusion
India has one of the world’s largest rates of farmer suicides. Farmers commit suicide
due to several reasons, including policy changes, climatic conditions, debt traps and
lack of market access. India has also mandated that companies need to spend 2%
of their net profit on community projects. Taking a cue from this mandate, LTFS,
one of the country’s largest financing companies undertook project Jalviabhav in
Maharashtra. The project involved using IWRM and CRA as the basis to provide
regional farmers ways and means to tide over their crisis by building water storage
structures, teaching about new ways of farming and livelihood. This chapter explores
if such CSR projects can address farmer suicides by examining the existing litera-
ture on farmer suicides and consumer vulnerability. The findings suggest that CSR
projects do have some utility—they create infrastructure and application knowledge
to impact practice. One needs to appreciate LTFS for taking up a difficult task as part
of its CSR, unlike other companies which spend their budget building toilets or class-
rooms. However, the impact of such CSR efforts held hostage by corporate chasing
quarterly profits, in changing the lives of distressed farmers, remains questionable
at its best. Due to their very origin (corporate) and nature (annual implementation
based on profit generated), CSR projects are unable to address policy challenges and
personal-level capabilities that are essential to overcome vulnerability. Monsanto’s
CSR project for smallholding farmers (Glover, 2007), who were also target customers
of the company, had to be closed down because of conflicts of interest between the
developmental and commercial goals of the company. It will be interesting to see the
future of Jalvaibhav as distressed farmers and potential borrowers are also the future
of LTFS’s own economic success.
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A Delicate Balance for Ruby Cup:
Profitability and Sustainability At
the Base of the Pyramid
Aneel Karnani
In 1998, at 14 years old, Maxie Matthiessen first began to consider the impact
menstruation had on disadvantaged populations when her neighbors came knocking
on her door collecting donations for refugees from the war-torn country of Sri
Lanka. They told her that girls and women were without feminine hygiene prod-
ucts and urgently needed pads and tampons. Matthiessen was both surprised and
intrigued. When she thought about wars, natural disasters, or developing economies,
food, toilets, and shelter had come to mind. But she had given little thought to the
importance of menstrual hygiene.
Fast forward 10 years. Matthiessen was about to finish her master’s degree at
the University of Copenhagen Business School when she learned of a product that
was gaining popularity among female students—the menstrual cup, an eco-friendly
alternative for menstrual hygiene products. She asked two of her fellow students—
Julie Weigaard Kjaer and Veronica D’Souza—to join her in her quest to bring the
menstrual cup to disadvantaged populations. They asked: Is it possible to create a
flourishing business model in a developing country? How will the product be accepted
by different cultures? What are the right sales and distribution models?
1The Ocean Conservancy collected and cataloged debris along U.S. coastlines between 2001 and
2006, finding that tampon applicators made up 2.2% of the total debris field, more than syringes,
condoms, and plastic six-pack rings combined.
A. Karnani (B)
Ross School of Business, University of Michigan, Ann Arbor, USA
e-mail: akarnani@umich.edu

https://doi.org/10.1007/978-981-16-5719-1_5
68 A. Karnani
The Problem
Girls and women in disadvantaged populations faced challenges with their monthly
cycle. They could not afford menstrual hygiene products and had little else to manage
their menstruation. Disposable solutions were expensive and out of reach for most
of these girls and women. In 2009, the news agency Inter Press Service wrote that in
Uganda, “Despite tax waivers introduced to reduce the cost of sanitary pads, finding
money to buy them each month is a challenge for many grown women, never mind
pre-teen girls.”i
Furthermore, disposable menstrual hygiene products caused environmental prob-
lems.1 This was especially true in settings with inadequate waste collection. Alterna-
tive menstrual hygiene solutions often included unhygienic items such as rags, cloth,
socks, and even bark and dried mud.
In Kenya, menstruation was linked to school absenteeism; girls were embarrassed
about the potential leaking of blood when non-protective materials were used.ii Period
pains and inadequate sanitation facilities in schools also contributed to female absen-
teeism during menstruation.iii Water Aid contended that, “Up to 40 days may be
missed for every African girl per school year due to menstruation.”iv The impact
of these missed days had been devastating. Some girls were unable to follow what
was taught in class, and others dropped out altogether, limiting their future career
options.v
The Solution
The menstrual cup had many benefits for women. First and foremost, it was consid-
ered a healthier menstrual solution because, unlike most pads and tampons, it
contained no fibers, bleach, or chlorine. If more girls and women in disadvantaged
populations used menstrual cups, there would be a marked decrease in trash in impov-
erished regions (the average woman uses 12,000 pads or tampons in her lifetime.)
Since the Ruby Cup was made from 100% medical-grade silicone, one product could
be used for 10 years. In addition to the ecological benefit, the menstrual cup was a
one-time investment that dramatically reduced the cost of menstrual hygiene over
the long term. On average in the United States, women spent around 5 USD on a
box of tampons containing 20 pieces. Depending on how many tampons a woman
needed during her period, this would amount to 50 USD to 100 USD a year. The
average price of a menstrual cup was 25 USD to 40 USD.
The menstrual cup is worn inside the vagina during menstruation. Rather than
absorbing the menstrual fluid as disposable products do, it collects it. When full, it
is emptied, rinsed, and applied again. To ensure hygienic use, the cup is boiled for
five minutes and stored in a cotton bag between periods.vi Despite its many benefits,
A Delicate Balance for Ruby Cup: Profitability and Sustainability … 69
the menstrual cup did not exist in developing countries. It was a growing trend in
developed markets only,2 where it was sold mainly via online channels.
Matthiessen wondered if the product could solve the problems of girls and women
from low-income populations had managing their periods. And quickly, the idea
to sell the menstrual cup to women at the Bottom of the Pyramid (BoP)—the 4
billion people who subsist on 1 USD to 3 USD a day—was born. After intensive
brainstorming sessions, the product was named “Ruby Cup.” The word “Ruby” was
used to brand the menstrual cycle as something valuable, not something that women
should be ashamed of. After naming their organization, the three registered it as a
limited liability company in Denmark.
The three founders wanted to take part in solving two of the world’s most daunting
problems—climate change and poverty. D’Souza, Weigaard Kjaer, and Matthiessen
wanted to create sustainable development by introducing an environmentally friendly
product to BoP markets that would help combat pollution, waste, and climate change.
They also wanted to establish a business model that would help alleviate global
poverty—a model specifically created for the BoP. Under this model, Ruby Cup
would interact with people who lived in the BoP both as consumers and as a resource.
People in the BoP would not only buy the product, but also become actively involved
in selling it.
Reaching Sustainable Development While Benefiting

the Poor
Eradicating Poverty: Bottom of the Pyramid (BoP) Theory
Authors C.K. Prahalad and Allen Hammond investigated the role business could
play as a facilitator of development in emerging economies. Using a BoP approach,
poverty alleviation would become a business development task shared between
private companies and BoP entrepreneurs. Prahalad’s BoP theory states that an indi-
vidual BoP consumer does not have much money. However, if one looks at the aggre-
gate number of people in the BoP, these regions have tremendous market potential.
In other words, “While individual incomes may be low, the aggregate buying power
of poor communities is actually quite large,” Prahalad said.vii
BoP theory challenged the predominant line of thinking that business in devel-
oping countries was unprofitable. Instead, it provided an optimistic account of alle-
viating poverty through business. According to Prahalad, economic activities that
targeted the poor could bring wealth to businesses and well-being to people. It was
an optimistic win-win scenario, in which companies could do well financially by
2 Since 2004, the number of menstrual cup brands had increased exponentially, from two brands
available in the United Kingdom and the U.S., to more than 30 in Western countries. And according
to Google trends, search interest in menstrual cups had more than tripled since 2005.
70 A. Karnani
doing good for society. Ted London and Stuart Hart, in their 2011 book: Next Gener-
ation Business Strategies for the Base of the Pyramid, built on the theory, stressing
that products and business models for the BoP should be co-developed with BoP
populations.
Where to Start?
The idea of making a living by doing good in the world seemed too good to be true.
Matthiessen, Weigaard Kjaer, and D’Souza were eager to start, but they did not know
where or how. The three started researching the concept as it related to the Ruby Cup.
D’Souza eventually found a study conducted in 2008 by the African Population and
Health Research Centre that tested the cultural acceptability of the menstrual cup
in Kenya, and found that 97% of Kenyan women and 100% of Kenyan schoolgirls
accepted the product.viii Now the Ruby Cup team had an indicator that Ruby Cup
was a good menstrual hygiene management3 solution for females in Kenya. After
reading the study, the three students decided to enter the Kenyan market first and
gradually expand to other BoP markets.
Kenya
Kenya was a country of many facets ranging from high crime and corruption to
innovative technology developments. With villas located next to slums, the richest
and poorest could be neighbors. Known for its friendly and eloquent people, Kenya
was home to some of the world’s most beautiful beaches and was famous for its
breathtaking safaris. At the same time, crime rates in the capital, Nairobi, were
skyrocketing.ix
Despite its low-income levels, Kenya was sometimes referred to as Silicon
Savannah, boasting innovation facilities and centers, such as iHUB and GrowthHub,
among other business incubators. It was East Africa’s economic hub,x and it had
been possible to save, invest, and send money via mobile phone using M-pesa 4 for
years. People around the world were finding that Kenya was the perfect place to start
a business. With a population of 45 million people, it had enormous market potential.
And its low-income market was vast—43% of Kenya’s population lived below the
poverty line.xi
3Menstrual hygiene management focuses on practical strategies for coping with monthly periods.
4M-pesa™ is a fast, secure, and convenient way to transact on mobile by Vodafone, through its
wholly owned subsidiary Mobile Commerce Solutions Limited in association with ICICI Bank.
Reaching Sustainable Development Through Business

in Practice
There were an estimated 11.5 million girls and women between the ages of 15
and 54 in Kenya.xii The three founders quickly calculated that if only 50% of this
segment bought a Ruby Cup, it would amount to roughly 6 million girls and women,
a substantial market.
Value Proposition
The sustainability of the Ruby Cup was a clear value proposition for the customer.
Because the Ruby Cup was designed to be re-used, the product constituted immense
cost savings over time. The initial investment was amortized quickly as the Ruby
Cup cost the equivalent of five to seven months of other menstrual hygiene products
and lasted 10 years.
Low Margin/High Volume Sales Model
Ruby Cup manufactured its product in China because the product material and
machinery were unavailable locally. Via a low margin, high volume sales model,
Ruby Cup strived to become the preferred menstrual hygiene solution for girls and
women in the BoP. Existing menstrual cups were sold under a high margin, low
volume model.
Ruby Cup calculated that it could still earn a minimum profit of 1 USD by selling
its product in the 5 USD to 10 USD price range. If it sold 5 million Ruby Cups to
girls and women in Kenya at these levels, then it could earn profits of 5 million USD
to 10 million USD. And Kenya was only one country out of many, leading the Ruby
Cup team to believe that the company had the potential to scale its operations. For
Matthiessen and her business partners, this seemed like a promising social enterprise
model. The company’s product would improve the menstrual and reproductive health
of girls, help to keep them in school, and keep waste from entering the environment,
while all the three founders created a financially sustainable and profitable business
model.
The Ruby Cup team wanted local women to sell its product, allowing it to reach
as many girls and women as possible. According to the United States Agency for
International Development, “There is considerable excitement about the potential of
direct sales agent models in health, as they (1) offer the prospect of better coverage for
the rural poor and hard-to-reach customers …”.xiii Other examples, such as Avon and
Hindustan Lever, had proven that the direct distribution model could be successful.
72 A. Karnani
The philosophy behind Ruby Cup’s business development was to depart from
a top-down approach to development to a consumer-centered one that focused on
the co-development of a business strategy among the company, its employees, and
the consumer. The company stated in its 2011 business plan that: “We believe in
partnerships in order to achieve our mission, as the best innovation comes from
an inclusive business approach, where our business is co-developed with multiple
stakeholders.”xiv
Pre-field Phase
In June 2011, the company went to Kenya to engage in a mini-pilot study with the
objectives of finding a partner organization and investigating the menstrual hygiene
problem as well as products used and their pricing. Upon its arrival in Kenya, the Ruby
Cup team established contact with the community-based organization Mchanganyiko
(meaning “unity in diversity”). Mchanganyiko was based in Kibera, one of the largest
slums in Eastern Africa, and seemed like the perfect partner because of its proximity
to Nairobi and its profound local knowledge about the menstrual hygiene challenges
in slums. Also, the organization had been engaging in projects with other international
partners and seemed trustworthy.
While the team was in Kenya to conduct its pre-field phase, the local government
announced the allocation of a substantial amount for free sanitary pads for schoolgirls
in Kenya with the purpose of keeping girls in school. The Guardian wrote: “For the
first time ever, the finance minister has allocated almost $4m from the current national
budget to provide free sanitary pads to schoolgirls.”xv The Ruby Cup team noted the
need for cost-efficient, healthy solutions, and the Ruby Cup seemed to appeal to
Kenyan girls and women as one of these solutions. Almost everywhere, members of
the Ruby Cup team presented information on the cup, they were asked, “Where can
we get the product and when can we get it?”xvi
During this phase, Ruby Cup’s founders realized that introducing the product
would be information-intensive and would require investments of time, manpower,
and money in product education. Most questions asked by consumers focused on the
perceived negative side effects of the product. For example, many girls and women
asked, “Will I get cancer by using this thing?”xvii Others were concerned about bowel
movements and asked, “Can I go to the toilet when a Ruby Cup is inside me?”xviii
(See Exhibit 1).
Exhibit 1 Ruby Cup Field Trip to Kenya, June 2011. Matthiessen talks to local women about their
menstrual health and explains how the menstrual cup is used. Source Ruby Cup
During the pre-field phase, the Ruby Cup team tested the reactions of girls and
women toward the menstrual cup and learned that local acceptance was quite high.
One month after the pre-field phase, the three Ruby Cup founders moved to Kenya
to develop and introduce the product to the country.
Establishing Ruby Cup
From September 2011 to July 2012, all necessary measures were taken to establish the
business in Kenya. The partners received funding through competitions and grants,
and they registered the business as a limited liability company (Makit East Africa
Ltd.) in Nairobi.
Product Development
From June 2011 to May 2012, the team developed the Ruby Cup in close coop-
eration with local communities in Kenya and Coloplast, a Danish multinational
company that specialized in intimate health care products. As part of its corpo-
rate social responsibility program, Coloplast provided its know-how and pro-bono
time. It established contacts with Ruby Cup’s suppliers in China and continuously
monitored the production process.
The Ruby Cup team also developed the packaging and design for the Ruby Cup in
collaboration with local girls and women. The Ruby Cup went through several design
74 A. Karnani
phases. In each phase, the Ruby Cup design changed according to the responses of test
users. The first Ruby Cup was considered too soft, and the thickness of the material
was increased. Test users also recommended enlarging the stem of the product to
make removal easier. The pop-up function was later deemed uncomfortable by test
users and was removed. The prolonged stem later became more flexible so that it
could not be felt when inserted, and the walls of the cup became firmer so that the
product would automatically open after insertion into the body. The company also
color tested its packaging in pink and cream versions and found that pink was the
most popular.xix
The last test product received positive feedback and was chosen for large volume
production.5 (See Exhibit 2 for the test samples). As part of its work with test
users, the Ruby Cup team additionally tested several marketing slogans in workshop
sessions in slum areas, ultimately leading it to choose the message “You Can Do
Everything.”
The first version of the Ruby Cup given to test users.
AŌer receiving reports that the cup seemed too soŌ, the
walls of the cup were made thicker.
The final version received posiƟve feedback and was chosen

for large volume producƟon.
Exhibit 2 Ruby Cup Test Samples from June 2011 to May 2012. Source Ruby Cup team and
Coloplast
5 The product feedback from Western consumers was equally positive. Ninety-four percent said
they would recommend the Ruby Cup to their friends, and more than 80% said that they would
choose Ruby Cup over other brands.
Recruitment
In July 2012, the Ruby Cup team chose to recruit local saleswomen. It selected sales
personnel from various backgrounds categorized by tribe, income level, educational
background, age, and gender. The team was prepared to test what worked best in terms
of sales strategy and salesperson profile through workshops with Mchanganyiko. Two
more partners, LivelyHoods and Miss Koch, came on board during this process and
the company, in concert with these three organizations, co-developed its business
model.
Sales Strategy Development
For the Ruby Cup sales strategy in Kawangware, LivelyHoods sales agents consid-
ered it important to give customers a guarantee that they would be able to return
the product if they did not like it. Ruby Cup leaders reasoned that the company had
to take as much risk off the customer as possible when introducing a new product
to a new market, especially when it required an up-front investment. In July 2012,
Ruby Cup agreed to test this sales strategy in Kawangware, introducing a six-month,
money-back guarantee.
Saleswomen in Korogocho suggested local marketing efforts that they believed
would make Ruby Cup widely known in the slum. Ruby Cup agreed to their sugges-
tions and participated in a local radio show and road show. Company leaders hoped
to build a trusted brand in the slum.
In Kibera, saleswomen recommended using a cost/benefit flier (see Exhibit 3) to
show customers how much money they would save by buying a Ruby Cup instead
of sanitary pads. The saleswomen also suggested that Ruby Cup offer customers
an installment payment plan. That way, customers could pay a small amount every
week or month, and after having paid the full product price, they would receive the
product.
All Ruby Cup saleswomen (except the LivelyHoods sales agents, who wore their
own sales outfits) were required to wear Ruby Cup T-shirts and sales IDs so customers
would take them seriously. The uniforms and IDs also prevented other women from
claiming they were Ruby Cup-trained saleswomen.
76 A. Karnani
When invesng in Ruby Cup, you save 15,800 KES

1 Ruby Cup is 1000 KES / 10 Years
YEAR 1 YEAR 2 YEAR 3 YEAR 4 YEAR 5 YEAR 6 YEAR 7 YEAR 8 YEAR 9 YEAR 10 Total
1000 0 0 0 0 0 0 0 0 0
Pads = 140 KES / Month or 1680 KES/ Year
YEAR 1 YEAR 2 YEAR 3 YEAR 4 YEAR 5 YEAR 6 YEAR 7 YEAR 8 YEAR 9 YEAR 10 Total
1680 1680 1680 1680 1680 1680 1680 1680 1680 1680
Exhibit 3 Ruby Cup Cost/Benefit Flier. Source Ruby Cup
Ruby Cup chose all sale prices and commission schemes in collaboration with its
partner organizations. As part of the effort, Ruby Cup tried out various price points,
payment methods, and marketing initiatives (see Table 1).
Working with Mchanganyiko in Kibera, Ruby Cup employed saleswomen ages
20–30 with little sales experience. It tested prices ranging from 5 USD to 10 USD
and offered an installment payment plan. The women were offered a 1.50 USD
commission, mobile phone airtime, and T-shirts when they reached certain targets.
With LivelyHoods, Ruby Cup tested the employment of both male and female
sales agents who had undergone previous sales training. These sales agents sold
the product at 12 USD, offered customers a six-month, money-back guarantee,
and earned a 1 USD commission. (As the intermediary, LivelyHoods also earned
a commission, driving up the final retail price of the product.)
In Korogocho, Ruby Cup employed experienced businesswomen ages 30–40 and
kept the price point open for sales agents to decide, offering a commission of 0.50
USD, mobile phone airtime, and T-shirts to sales agents who met targets.
Table. 1 Locations and sales strategies

Name Mchanganyiko LivelyHoods Miss Koch
Locality Kibera Kawangware Korogocho
Consignment Yes Yes Yes
Agent profile Women, ages 20–30 Female and male, Women, ages 30–40
ages 15–20
Sales experience None, but some had Yes. Had undergone Yes. These were
part-time jobs extensive sales businesswomen, such
training as small kiosk owners,
pharmacy owners, etc
Customer incentives Installment payment Six-month, Low and flexible price
plan money-back
guarantee
Price schemes 5 USD–10 USD 12 USD A sales amount of 3
USD to 5 USD was
recommended, but left
open for saleswomen to
decide
Commission 1.50 USD 1 USD 0.5 USD
Other incentives for Airtime and T-shirts The organization had Airtime and T-shirts
saleswoman when targets were met its own incentive when targets were met
schemes
Source Created by the author of the case
Sales Training and Marketing
From July 2012 to September 2012, the sales teams and Ruby Cup engaged in
extensive sales training with role-playing as the preferred technique. During these
sessions, the Ruby Cup team and the saleswomen gave one another sales tips.
Ruby Cup on Local Radio
In the Korogocho slum, Ruby Cup engaged in local marketing efforts by participating
in a two-hour radio show. A number of community members called in and asked
questions. Both local saleswomen and a Ruby Cup team member were present and
available to answer these questions during the show. The radio show was considered
a success. However, it did not lead to increased sales in the slum.
78 A. Karnani
Ruby Cup Road Show
Ruby Cup also engaged in local marketing during a one-day road show in Korogocho
in September 2012. Ruby Cup and Miss Koch members drove around Korogocho
playing hip-hop music and informing slum dwellers about the Ruby Cup while
offering it at a price of 500 KES (5 USD). The event was a great success—in just one
day, Ruby Cup was able to reach 20,000 people. Although the show was considered
a success, the feedback received during the road show indicated that the cost of the
product at 500 KES (5 USD) was too pricey for slum dwellers.
Ruby Cup at the Nairobi International Trade Fair
To create demand for the Ruby Cup, the company presented the product at the
Nairobi International Trade Fair in November 2012 with a stall designed to provide
information to middle-class Kenyans. During the weeklong fair, Ruby Cup sold
around 100 products at the introductory price of 500 KES (5 USD). During the
show, valuable contacts with teachers and students were made, and Ruby Cup was
able to brand itself locally by distributing fliers and stickers. (See Exhibit 4).
Exhibit 4 Ruby Cup at the Nairobi International Trade Fair. Ruchita, a Ruby Cup accountant,
preparing the Ruby Cup stall in the morning. Source Ruby Cup
Table. 2 Price levels and number of cups sold

Prices in KESDateLocation/Cups soldNotes organization
1,200 Jul 2012–Dec 2012 LivelyHoods 10 Upper
class/expatriates
500–1,000 Jul 2012–Dec 2012 Mchanganyiko 6
300–500 Jul 2012–Dec 2012 Miss Koch 5
500 Oct 2012 Nairobi International 100 Sold to middle-class
Trade Fair Kenyans
300 Dec 2012 Kibera 35
100 Jul 2012–Dec 2012 Kibera 277
100 or below Jan 2013–Dec 2013 Various locations in 2,000
Kenya and Eastern
Africa
Source Created by the author of the case
Free and Subsidized Products
In addition to direct sales, from July 2012 to November 2012, Ruby Cup partnered
with local organizations in Kibera, such as Carolina for Kibera and St. John’s Primary
School. Ruby Cup both donated products and offered them at the subsidized price of
100 KES (1 USD) to the organizations. The Ruby Cup team assumed that this would
lead to word-of-mouth marketing. It was expected that Ruby Cup would be branded
as a trustworthy company that provided support to local girls.
More About Pricing
When prices were lowered in Kibera to 300 KES (3 USD or the equivalent price
of pads over two months), a saleswoman managed to sell 35 Ruby Cups. She tried
various price points and quickly realized that as she lowered the price further to 100
KES (1 USD), she was able to sell even more Ruby Cups. Nevertheless, the 100 KES
price was below the cost of production. Table 2 shows the different pricing levels
and numbers of cups sold.
Evaluation of Sales
Despite using local marketing techniques and co-developing its product, sales
strategy, and business model, it was impossible for Ruby Cup to sell enough prod-
ucts to cover its costs by December 2012. All of the incentive schemes designed
to convince customers to buy the Ruby Cup had failed. The money-back guarantee,
80 A. Karnani
experimentation with different installment payment plans, and various price schemes
were yielding few results. It seemed that all of Ruby Cup’s marketing, branding, and
sales efforts had been in vain. Selling Ruby Cups at 500 KES to 1,000 KES (5 USD
to 10 USD) or even below the cost of production at 300 KES (3 USD) was difficult.
The tipping point seemed to lie between 300 KES and 100 KES (3 USD and 1 USD),
an unfeasible price range for the company.
Learnings
Low Retention of Customers Demotivating for Sales Personnel
After finding out that a Ruby Cup lasted for 10 years, sales agents quickly lost interest.
Educating consumers about the product was both difficult and time-consuming.
Once customers were convinced and the product had been sold, sales agents had
to start from scratch to recruit new customers. During an informal conversation, a
saleswoman told Ruby Cup representatives, “Once I convince a customer to buy
Ruby Cup, she buys, but then she will never come again. All my efforts were in vain.
And really convincing her was hard, so I get tired.”xx
Costs
In addition to the cost of product education, the price of doing business in Kenya was
much higher than Ruby Cup managers had anticipated. Weigaard Kjaer argued that,
“Customer acquisition costs are extremely high, so we will not break even. We use
much too much money to sell one Ruby Cup to one woman. We need to find newer
and more efficient distribution and sales channels. Possibly we need to reconsider
our entire business model.”xxi
Conclusion
It became apparent that introducing the Ruby Cup to the Kenyan BoP market in line
with BoP theory had failed. Only when the product was offered at prices below the
cost of production was the company able to really reach BoP segments. Moreover,
marketing costs were more expensive than initially expected and were by no means
covered by sales. This was related to the intensive customer education required to
explain the long-term cost savings of the Ruby Cup as well as how to use the product.
Moreover, the near 0% retention rate of customers demotivated sales personnel.
Finally, the high employee turnover rates in Kenya drove up staff training costs.
Weigaard Kjaer said, “Current pricing models are not sustainable.”xxii
The company was facing a predicament. On the one hand, Ruby Cup had a positive
impact on Kenyan girls and women. Ruby Cup received several letters from girls
stating how proud they were to be using the Ruby Cup and how much it alleviated
their daily worries when menstruating. One girl from Kibera wrote, “Before I started
using Ruby Cup, I was using rags. Sometimes I was using pads. I usually stayed home
until my menstruation stopped, because I felt shy. But now I am using Ruby cup. I
can do anything; I can jump. But before I was asking money from my boyfriends,
sometimes I was asking my mother, who sometimes did not have money. I usually
used rags … I like Ruby cup with all my heart because it is helping me so much.”xxiii
On the other hand, continuing along the path the founders had charted would
mean the financial death of the company. The sustainability of the Ruby Cup was
identified as one of the factors that limited its success in the Kenyan market. (See
Exhibit 5.)
Not affordablefor
Unfavorable for company
BoP customer
High Prices Low Margins
High Producon/
High EducaonCosts Slow Sales Cycles
Importaon Costs
Durable Products
Exhibit 5 Disadvantages for Ruby Cup in the Kenyan Market. Source Created by the author of the
case
After one and a half years of product development, studying the Kenyan market,
and trying to introduce the Ruby Cup to that market, the three founders sat back and
reflected on why Ruby Cup struggled to become a profitable business venture. They
82 A. Karnani
wondered: Is sustainability a luxury? Is it possible to sell sustainable products in

developing countries? Is it possible to create a sustainable social enterprise in a BoP
market? Can we make our products affordable to BoP populations? If not, what are
the alternatives?
Endnotes
i. Kissling, Elizabeth. “Girls, Periods, and Missing School II. Breaking
the Silence.” 1 Nov. 2009. Society for Menstrual Cycle Research. Web.
Accessed 8 December 2013. http://menstruationresearch.org/2009/11/01/
girls-periods-and-missing-school-ii-breaking-the-silence/.
ii. Water, Engineering and Development Centre (WEDC). “Menstruation
hygiene management for schoolgirls in low-income countries.” June 2012.
Web. Accessed 13 Jan. 2014. http://www.susana.org/_resources/documents/
default/2-1569-fs007mhma4pages.pdf.
iii. Ibid.
iv. Moma, Lindlyn. “Menstrual Hygiene Management in Africa.” WaterAid
Southern Africa Regional Office. Web. Retrieved December 8, 2013, from
(video file). http://www.youtube.com/watch?v=_-grXbZJFQE.
v. WEDC.
vi. Ruby Cup. (2014), Web. Accessed 4 August 2014. http://www.ruby-cup.
com/en/how-you-use-it.
vii. Prahalad, C.K. and Allen Hammond. “Serving the world’s poor, profitably.”
R0209C ed. Harvard Business Review. (2002). Print.
viii. African Population and Health Research Center. “Attitudes towards, and
acceptability of, menstrual cups as a method for managing menstruation:
Experiences of women and schoolgirls in Nairobi, Kenya.” Policy Brief, 21
(2010). Print.
ix. Stavrou, Aki. “Crime in Nairobi. Results of a citywide victim survey.” Sept.
2002. UNDP, UN Habitat. Web. Accessed 30 Oct. 2014. http://unhabitat.
org/?wpdmact=process&did=MTAwMS5ob3RsaW5r.
x. Zijlma, Anouk. “Kenya Basic Facts.” Go Africa. Web. Accessed 22 Feb.
2014. http://goafrica.about.com/od/kenya/a/kenyafacts.htm.
xi. CIA World Factbook. "Kenya." 20 June 2014. Central Intelligence Agency,
USA. Web. Accessed 22 Feb. 2014. https://www.cia.gov/library/publicati
ons/the-world-factbook/geos/ke.html.
xii. Ibid.
xiii. USAID. “Direct Sales Agent Models in Health.” The Strengthening Health
Outcomes through the Private Sector (SHOPS) Project. April 2013. USAID.
Web. Accessed 13 January 2014. http://www.shopsproject.org/sites/default/
files/resources/Direct%20Sales%20Agent%20Models%20in%20Health.
pdf.
xiv. Ruby Cup Business Plan. 2011. Print.
xv. Gathigah, Miriam. “Kenya: Government funds free sanitary pads for
schoolgirls.” 29 July 2011. The Guardian. Web. Accessed 22 Feb.
2014. http://www.theguardian.com/global-development/2011/jul/29/kenya-
schoolgirls-sanitary-pads-funding.
xvi. Ruby Cup Field Notes, Meru. 2011.
xvii. Ibid.
xviii. Ibid.
xix. Ruby Cup Kibera Workshop. 2011.
xx. Interview with Ruby Cup saleswoman Zena Ali from Nairobi, Kenya via
e-mail. 30 Dec. 2013.
xxi. Interview with CEO Julie Weigaard Kjær from Nairobi, Kenya via e-mail.
13 Dec. 2013.
xxii. Ibid.
xxiii. Letter from Valentine Otiendo, 13 years old, Kenya. 5 August 2012.
References
African Population and Health Research Center. (2010). “Attitudes towards, and acceptability of,
menstrual cups as a method for managing menstruation: Experiences of women and schoolgirls
in Nairobi, Kenya.” Policy Brief, 21. Print.
Zijlma, Anouk. “Kenya Basic Facts.” Go Africa. Web. Retrieved February 22, 2014, from http://
goafrica.about.com/od/kenya/a/kenyafacts.htm.
Stavrou, Aki. (2002). “Crime in Nairobi. Results of a citywide victim survey.” Sept. 2002. UNDP,
UN Habitat. Web. Retrieved October 30, 2014 from http://unhabitat.org/?wpdmact=process&
did=MTAwMS5ob3RsaW5r.
CIA World Factbook. “Kenya.” (2014, June 20). Central Intelligence Agency, USA. Web. Retrieved
February 22, 2014, from https://www.cia.gov/library/publications/the-world-factbook/geos/ke.
html.
Prahalad, C.K., & Hammond, A. (2002). “Serving the world’s poor, profitably.” R0209C ed. Harvard
Business Review. Print.
Kissling, Elizabeth. “Girls, Periods, and Missing School II. Breaking the Silence.” (2009, November
1). Society for menstrual cycle research. Web. Retrieved December 8, 2013, from http://menstr
uationresearch.org/2009/11/01/girls-periods-and-missing-school-ii-breaking-the-silence/.
Interview with Ruby Cup saleswoman Zena Ali from Nairobi, Kenya via e-mail. 30 Dec. 2013.
Interview with CEO Julie Weigaard Kjær from Nairobi, Kenya via e-mail. 13 Dec. 2013.
Letter from Valentine Otiendo, 13 years old, Kenya. 5 August 2012.
Moma, Lindlyn. “Menstrual Hygiene Management in Africa.” WaterAid Southern Africa Regional
Office. Web. Retrieved December 8, 2013, from (video file). http://www.youtube.com/watch?
v=_-grXbZJFQE.
Gathigah, M. (2011, July 29). “Kenya: Government funds free sanitary pads for schoolgirls.” The
Guardian. Web. Retrieved February 22, 2014, from http://www.theguardian.com/global-develo
pment/2011/jul/29/kenya-schoolgirls-sanitary-pads-funding.
Ruby Cup. (2014). Web. Retrieved August 4, 2014, from http://www.ruby-cup.com/en/how-you-
use-it.
Ruby Cup Business Plan. (2011). Print.
Ruby Cup Field Notes, Meru. (2011).
Ruby Cup Kibera Workshop. (2011).
USAID. “Direct Sales Agent Models in Health.” The Strengthening Health Outcomes
through the Private Sector (SHOPS) Project. April 2013. USAID. Web. Retrieved January
84 A. Karnani
13, 2014, from http://www.shopsproject.org/sites/default/files/resources/Direct%20Sales%20A

gent%20Models%20in%20Health.pdf.
Water, Engineering and Development Centre (WEDC). (2012, June). “Menstruation hygiene
management for schoolgirls in low-income countries.” Web. Retrieved January 13, 2014, from
http://www.susana.org/_resources/documents/default/2-1569-fs007mhma4pages.pdf.
TATA Steel India: Corporate Social
Responsibility Case Study Project
Kamal Singh and Tamanna Girdhar
Introduction
CSR relates to the duty of a corporation regarding its effect on society. This includes
social, environmental and economic aspects, as outlined in the internationally recog-
nized CSR reference documents, which includes documents like the key ILO decla-
ration on multinationals and social policy, the OECD Guidelines for Multinational
Enterprises, and the UN Guiding Principles on Business and Human Rights of the
UN Global Compact. More specifically, CSR involves, fair business practices, staff-
oriented human resource management, economic use of natural resources, climate
and environmental protection and sincere commitment to the local community. Many
companies also began using the term corporate responsibility (CR) as a synonym for
CSR some years ago. When discussing CR, some authors emphasize both on the
economic dimension of sustainability and corporate governance issues more than
when looking at CSR, at the same time others prefer CR to avoid confusion. That’s
because the “financial” in CSR is sometimes translated to imply “supporting the
economically vulnerable,” incorrectly restricting its significance. Therefore, in recent
years, corporations have used the phrase corporate responsibility more frequently
than CSR. Organizations who find their CSR efforts to be an add-on that has little to
do with their corporate strategy and main company fall short of the mark, whether
it’s workplace safety and wellbeing, employee retention, energy management or
accountability along supply chain lines. Several CSR fields have a major effect on
Author Note: This chapter is an outcome of a Best Case Study Innovative Practices conducted
by Global Compact India Network in 2019. Content has been used with permission from relevant
authorities.
K. Singh · T. Girdhar (B)

UN Global Compact Network India, New Delhi, India
e-mail: tamanna.girdhar@globalcompact.in

https://doi.org/10.1007/978-981-16-5719-1_6
86 K. Singh and T. Girdhar
the performance of a company. Effective program should be designed and imple-

mented in order to motivate the private sector to achieve the targeted development
goals.
No doubt, CSR and SDGs are intertwined, just like two strands of the DNA. So,
businesses should clarify and reorient their purpose of business. It is a misnomer
to believe that the purpose of business is to only make profit or to solely serve the
shareholders. The ultimate aim of business is to serve society without eroding our
environmental and community life-support systems by providing safe, high-quality
products and services that improve our well-being. Thus, the paper aims to explore
the CSR strategies adopted by the TATA Steel India, in order to make its busi-
ness sustainable and provide a brief overview of how the multinational corporation
facilitate and carry out CSR projects in India.
Literature Review
As per a research conducted by Dr. A. Raghurama, on the importance of CSR,

analyzed that in India the concept of Corporate Social Responsibility has changed
over the years because of changes in social, political, economic, cultural, and legal
environments. All these environments encompasses other dimensions of CSR fulfill-
ment, such as charity, philanthropy, national economic growth, the development of
educational institutions, hospitals and religious places of worship through setting
up corporate trusts, the creation of public sector undertakings, ethical working envi-
ronment regard for human rights, protection of employees and minorities as well as
social and sustainable development initiatives.
It was also highlighted in his research that globalization and trade liberalization
allow businesses to export premium goods in line with foreign regulations and comply
with market lawetc. It is important to understand that globalization and liberalization
requires a company to abide by the society’s obligation for survival. Companies must
be responsible and cautious with the social climate. The CSR should be planned by
the company to support both the enterprise and related communities.
It is also important to focus that the effectiveness of CSR policy depends on the
budget and the field of obligation assumed and on successful supervision of the CSR
policy. The government should facilitate and implement policies and legislation for
the advantages of CSR-adapting companies and take initiatives aimed at encour-
aging SME participation in CSR. Corporate Social Responsibility has become an
even-greater part of the business environment. The last twenty years have witnessed
a significant change in the interaction between the business sector and both the
state and civil society the major causes of this transition were economic globaliza-
tion, expanded business scale and power, policy repositioning, and the growth of
stakeholder partnership strategic value, expertise, and brand recognition. All these
developments have modified the foundation from which we trust private business
would contribute to the public benefit.
TATA Steel India: Corporate Social Responsibility … 87
Moreover, the partnership between corporations and civil society groups has changed from
paternalistic philanthropy to a re-examination of company positions, privileges, and obli-
gations within society. Another result of these innovations is Corporate Social Respon-
sibility (CSR), described in terms of corporations’ adherence to the political, social and
environmental aspirations of stakeholders.
Therefore A. Raghurama concluded his study by emphasizing that CSR is typi-

cally a proactive reaction to demand from customers and the civil society. Accusations
of water degradation, human rights transgressions, and labor abuses in supply chains
by governments and civil society alike have forced businesses to become both envi-
ronmentally and socially conscious. Nevertheless, corporations have quickly realized
the strategic importance of becoming more accountable and are beginning to coor-
dinate goods and corporate ties, particularly through their supply chains in order to
have a sustainable business.
According to one of the researches conducted by the International Journal of
Research it was highlighted that in developing countries like India, CSR is seen
as part of corporate philanthropy in which corporations augment social develop-
ment to support the social initiatives of the government. However, with time, the
scenario of CSR has changed from being philanthropic to being socially respon-
sible to multi stakeholders. The period of 1960s saw an emergence of CSR activities
being revamped in corporate philanthropy. India has been named among the top ten
Asian countries paying importance towards corporate social responsibility (CSR)
disclosure norms. India was ranked fourth in the list, according to social enterprise
CSR Asia’s Asian Sustainability Ranking (ASR), released in October 2009. ‘Sustain-
ability in Asia ESG reporting uncovered’ is based on four parameters viz. General,
Environment, Social and Governance. In its study based on 56 companies in India,
it observed that India is ranked second in country ranking in Asia and is ranked
one ranking in general category. It was observed that reporting is strongly followed
by companies as well as they seek international development standards. It could
be attributed to the Indian government compelling the public sector companies to
provide for community investment and other environmental, social and governance
liabilities. One of the key findings of the survey conducted in June 2008, aimed at
understanding the role of corporations in CSR, carried out by TNS India and the
Times Foundation. It revealed that over 90 per cent of all major Indian organiza-
tions surveyed were involved in CSR activities. Besides the public sector, it was the
private sector companies that played a dominant role in CSR activities. A study on
the CSR activities of 300 corporate houses, conducted by an industry body in June
2009, revealed that Corporate India has spread its CSR activities across 20 states
and Union territories, with Maharashtra gaining the most from them. The study also
revealed that about 36 per cent of the CSR activities are concentrated in the state,
followed by about 12 per cent in Gujarat, 10 per cent in Delhi and 9 per cent in Tamil
Nadu. The companies have, on an aggregate, identified 26 different themes for their
CSR initiatives. Of these 26 schemes, community welfare tops the list, followed by
education, the environment, health, as well as rural development.
On the same line of thought, it was revealed that many countries separate philan-
thropy from social responsibility. While in India, it is seen as a weapon for social
activities including recruitment and retention. CSR norms in India face numerous
challenges, like many argue that it helps in building an image of the organization.
While some argue that the government does away with their role of playing a regu-
latory body over the powerful business houses. Others often criticize that CSR is
not their basic economic role of business. Some even say that CSR is put in place
to gain profit as well. It is also argued that CSR initiatives undertaken result into
deviation from basic business roles. The impact of the CSR not only impacts profits
but benefits the society at large. In the light of these arguments, the trend of increased
CSR initiatives cannot be ignored clearly reflecting the awareness the companies in
India have gathered today.
The research concluded with the following suggestions for the challenges faced
by various companies with respect to their CSR policy.
Firstly, Companies can set a network of activities that can be taken up in a consor-
tium to tackle major environmental issues. It would also provide an opportunity to
learn from each other. Secondly, everyone in the organization needs to recognize
their own role in promoting CSR. Companies should provide wider professional
development activities, training, conferences and seminars to generate and facili-
tate new knowledge and information about this sector. Lastly, a strong budgetary
support would help to grow this sector and research related to respective industries
would enhance their organization’s contribution further. Hence, all of these sugges-
tions would lead to benchmark CSR activities. It is important that companies involve
their stakeholders in order to build meaningful and long-term partnerships leading
to a strong image and brand identity. It is also suggested to review existing policies
in order to develop more meaningful visions for the companies and broaden their
contributions to reach to local communities and flourish their business further.
As per the High-level Committee report on Corporate social responsibility 2018,
In the last few years, the implementation of Corporate Social Responsibility (CSR)
has gathered critical attention of masses and has enabled a scope for the field to grow
further. The report focuses on CSR awareness and CSR consciousness, which has
grown dramatically among large and medium-sized companies, as they now focus on
CSR to build a strategic fit business with the community and environment in which
they operate. It was also highlighted in the report that Broadly, the CSR mandate
has been aligned with national priorities such as public health, education, livelihood,
water conservation, natural resource management, etc.
More importantly, it has generated national interest and debate on its potential role,
and the responsibility of the corporate sector in achieving Sustainable Development
Goals (SDGs).
The High-Level Committee set up in 2015 (HLC-2015) reviewed the CSR regu-
latory framework at an incipient stage. It made a number of useful recommendations
and also pointed out that it was limited by not having adequate ‘learning experience’
as the new Companies Act had only just mandated CSR.
The HLC–2018 was set up to review the CSR framework and make recommenda-
tions to develop a more robust and coherent CSR regulatory and policy framework.
The report was compiled by the committee that was set up with eminent government
officials, public sector enterprises, private sector, civil society, and academia who
looked at the subject matter in a holistic manner, discussed emerging global debates
over social development, and steered the deliberations to arrive at dynamic conclu-
sions. It was informed that the Committee adopted a consultative approach, engaged
with stakeholders, had public consultations, examined reports and recommendations
of previous Committees, relied on observations of Parliamentary Standing Commit-
tees, as they the reviewed global literature and best practices pertaining to CSR.
During these meetings, the Committee deliberated on a wide range of issues related
to CSR policy, implementation, monitoring, enforcement, advocacy and awareness,
as well as new issues arising out of public consultations.
After detailed deliberations and a comprehensive review, the Committee identified
specific issues arising out of the provisions of Sect. 135 of the Companies Act, CSR
Policy Rules, Schedule VII of the Act and associated operational challenges. The
report was then organized into four chapters. The Introduction Sets the context for
deliberations and the first chapter gives the background and history of CSR in India.
Chapter “Corporate Social Responsibility and Sustainability Development Mapping:
Practical Application Beer and Nigel Roome Model” was a comprehensive analysis
of the data on CSR reported by companies. This has brought to light interesting trends
and patterns of CSR spending and has lent valuable insight for decision-making by the
Committee. Chapter “Addressing Social Risks: The Corporate Social Responsibility
Way” highlighted key issues on CSR that were discussed by the Committee, and the
recommendations made by it on them. Chapter IV proposed the way forward and
future scope of CSR considering the recommendations made in the report.
We can infer from the literature reviewed above that the term CSR does not have a
single agreed definition that encompasses without needing to change in accordance
with new realities. The lack of homogeneity in definitions could be attributed to
CSR’s ever-changing roles in business practice. The earlier definitions of CSR all
reflect the need for Philanthropic activities that are designed to contribute to social
welfare and development. The main field for researchers at this point of time in
describing CSR is defined as voluntarism and contributing to social welfare. The
next stage is a time of increasing concern and knowledge regarding workers’ rights,
stakeholder loyalty and management of partnerships, supervised CSR activity and
consumer security. The final stage is the time of instrumentality and stabilization
which demonstrates the implementation of CSR acts as a strategic tool to achieve
organizational goals. CSR is therefore now widely institutionalized and validated by
numerous multinational indices of responsible investment and sustainability.
It is important to understand that the key aspects of CSR are the same focal
field underlined by numerous academics in describing what CSR stands for. In
short, it is the features that depict CSR performed by business organizations starting
with voluntary activities, managing external factors, managing stakeholders, aligning
social and economic responsibilities, taking into account practices and values, and
finally extending CSR activities beyond philanthropy. The remaining theories all
emphasize taking CSR as an integral part of strategy for achievement of sustainable
organizational objectives.
Significance of the Study
India is the 2nd highest populous country in the world. Most of the population is living
in the villages. India has achieved 65% literacy rate only. Majority of the rural people
are illiterate, not accessible to good health facilities and nutritious food. 20 percent
of the rural people are in the poverty line. The business houses are earning profits by
rendering their services to customers in society. The government alone can’t uplift
the downtrodden people. The corporate houses and non-governmental organizations
have to come forward to eradicate various social evils and play vital role in society
development their activities such as providing quality education, extending health-
care facilities, nutritious food, creating awareness on environment safety, drinking
water facilities, sponsoring the sports events, participating in natural disaster manage-
ment programmes, ethical values promotion, enriching the Indian culture, etc. The
corporate houses have to come forward to do their part towards the development of
the society. This contribution will be helpful to the organizations to enhance their
brand awareness and reputation in the market. Society development should be treated
as an integral part of the organization’s strategy. CSR strategies promote corporate
sustainable development as well as society as at large. Therefore, community devel-
opment is a responsibility of the government, non-governmental organizations and
business organizations as well.
Research Objectives
From the literature review carried out, the research objectives were framed as follows:
• To study the CSR status in India.
• To understand the innovative practices under CSR by TATA Steel India.
• To study the Indian government policies and programmes of CSR.
• The main purpose of the study is to analyze the corporate social responsibility
(CSR) activities carried out by TATA Steel India.
CSR Status in India
In April 2014, following an amendment to the Companies Act 2014, India became the
first country in the world to make it mandatory for businesses to comply with corpo-
rate social responsibilities (CSR).Companies should spend a part of their income as
part of compliance with the CSR in areas like education, poverty, equality among
men and women and hunger.
The Ministry of Corporate Affairs has notified that Amid the COVID-19 (coro-
navirus) outbreak, companies’ expenditure to fight the pandemic will be consid-
ered valid under CSR activities. Funds can be dedicated to various COVID-19
programs such as health promotion, including safety precautionary, sanitary and

disaster management.
The amendment notified in the Companies Act, 2013 requires companies to spend
2 percent of their average net profits of three years on Corporate Social Responsi-
bility. The CSR clause has historically been voluntary for corporations, while the
declaration of CSR costs to shareholders was compulsory. CSR comprises but is not
limited to:
• Projects relating to the activities set out in the Company Act;
• Projects relating to the research undertaken by the Board of Directors.
As per the CSR amendments under the Companies (Amendment) Act, 2019.
Until now, if a company was unable to fully spend its CSR funds in a given year,
it could carry the amount forward and spend it in the next fiscal, in addition to the
money allotted for that year.
The CSR approach is the framework for the measurement and evaluation of an
organization’s social impact. It begins with a close assessment of the company’s
client, suppliers, environment, communities and staff. Also, while organizations
comply with regulations, the most successful CSR initiatives ensure that their expen-
diture supports the growth and prosperity of disadvantaged populations and the envi-
ronment. CSR should also be sustainable—with activities that an organization can
sustain without affecting its business objectives negatively.
In India, the adoption and integration of CSR initiatives by organizations in their
business processes has rather been sensitive. It is increasingly being projected in the
Indian context as organizations realize that it is also necessary to form responsible
and positive relationships with the community in general as well as to develop their
businesses. Organizations also have many departments and teams that create and set
different budgets to support particular programs, strategies and goals for their CSR
programmes. These programs are most often based on well-defined social beliefs or
carefully aligned with the business domain of companies. In order to understand the
CSR scenario in India better, it is important to look at the following CSR trends in
India.
CSR investment by Indian companies has risen dramatically since the applicability
of the compulsory CSR clause in 2014. In 2018 businesses contributed US$ 1 billion
to CSR programs, a study showed. In 2018 they invested 47 percent more than in
2014–15.
Listed companies in India spent INR 100 billion (US $1.4 billion) on various
programs including the production of educational, skills, social welfare, health and
environmental protection, while CSR investments have been raised by 139 percent
over the last year as per the Prime Minister’s Relief Fund. The education industry
obtained the highest amount of funding (38%), preceded by hunger, deprivation
and healthcare (25%), environmental protection (12%), rural innovations (11%).
Incubator services, education, military activities and the elimination of disparities
have been negligible spending.
Considering recent amendments to the CSR regulations, industry research esti-

mates that compliance with the CSR will improve by the financial year 2019–20,
ranging from 97 to 98%.
About the Company: TATA Steel
Tata Steel is the world’s largest steel manufacturer in India, incorporated by Jamshedji
Tatas. A 100-year-old company, the whole value chain of steel production, from
mining and processing of iron ore and coal to production and distribution of finished
products, has an established presence. In the domestic steel industry, the business
is second following SAIL with an annual turnover in 2007–08 of Rs.22,189 crore.
Average of 90 percent of the company’s sales are produced by the steel division. It
primarily targets the automobile and construction industries. Tata Steel has a market
share of 41% and 26% in both categories, according to reports. In May 2008, brown-
field expansion was completed by the business at this site, which expanded its gross
output from 5 to 6.8 million tons. Furthermore, the firm has a Jamshedpur manu-
facturing plant making welded steel tubes. The corporation also operates the Orissa
chrome ferro-power factory, the West Bengal spinning mill and the Maharashtra
and the Karnataka wire processing facilities. This has 24 regions in India and 15
nations in North America, Europe, southern Africa and Asia across the globe as the
company’s distribution network. In line with its vision of becoming a global company
with 50 million tons steel capacity by 2015, the company grew its size through the
acquisition route. In a giant leap, the company acquired Corus in April 2007, the
second largest steel producer in Europe and the ninth largest steel producer in the
world for USD 13.7 billion. Corus has production facilities in the United Kingdom
and The Netherlands and downstream manufacturing facilities in Germany, France,
Norway and Belgium. With the acquisition of Corus, which is four times the size
of the Indian operations of the company, Tata Steel became the world’s sixth largest
steel company, having an annual crude steel capacity of 28 million tons and a pres-
ence in nearly 50 countries. At the same time The TATA brand owing to its highly
ethical and a socialistic approach to business have made its name synonymous to
trust. After the acquisition of Corus another powerful brand, the brand value of the
company has enhanced further.
TATA Steel’s annual crude steel capacity across Indian operations is nearly 13
MnTPA and they have a registered a turnover of US $7889 Mn in FY 2017 they also
set up their second greenfield steel plant in the eastern state of Odisha; commissioning
the first phase (3 MnTPA) of 8 M tons of steel capacity in 2016 TATA Steel possess and
operate captive mines that help them maintain cost-competitiveness and production
efficiencies through an uninterrupted supply of raw material. This is how they ensure
that they remain the lowest cost producer of steel in Asia. They aim to focus on
enhancing raw material security. The company plans to reorganize its group structure
by creating an international company for consolidating its raw material assets that are
spread across the world. For instance, the company inked a joint venture agreement
with Riversdale Mining to develop a coking coal project in Mozambique. The Tata
Iron and Steel Company, located at Jamshedpur is the best-known symbol of India’s
industrial growth. The company has exported products worth more than US $ 182.3
million in 1996–97. Tata Steel remains India’s largest single explorer of value-added
high-quality steel products. It is a blue-chip company, and has successfully raised
US $100 million through Euro Bonds. Tata Steel is India’s single largest integrated
steel works in the private sector with a market share of over 13%. It has, over the
years, employed state-of-the-art know-how and processes to manufacture a wide
range of steel and engineering products as well as minerals and Ferro-alloys. Its steel
products include HR coils, tubes, bars, rods, structures, strips, sheets and bearings.
The steel plant is integrated with activities ranging from mining of raw materials to
finished rolling of steel. Over the years the company has promoted several associate
companies in related areas such as engineering, refractors and rolls. Turnover: Rs
64,335 million Year of Establishment: 1907 No. of Employees: Works 29,648 (Total
68,300). The following feature and strengths of TATA Steel makes it one of India’s
largest and globally renowned steel manufacturer in India.
Abundant Mineral Reserves
Tata Steel has two collieries in West Bokaro and Jharia, in the state of Jharkhand.
The iron ore units are located in Noamundi, Joda and Katamandi in the states of
Jharkhand and Orissa. Tata Steel Limited also has a manganese mines and dolomite
quarries in Orissa. These mines are located at an approximate distance of 150 kms
from Jamshedpur, home to the steel company’s manufacturing facility. The Steel
Company’s iron ore units produce 9 million tons per annum of various grades of
high-quality iron ore including rich blue dust ore. The company in India is having
mines of 281 million tons reserves in its mines in Jharkhand and thus having minerals
to cater its needs for more than 20 years. The company has also been acquiring stake
overseas in Canada, Mozambique, Australia etc. to boast its reserves for clean coking
coal which is rarely available in India.
Credible and Capable Management Team
Tata Steel has a highly credible management team who has displayed their skills
in expanding the company through inorganic route. The company has successfully
acquired Nat Steel of Indonesia, Millennium Steel of Thailand and more importantly
Corus. The company’s virtuosos of finance have been able to find innovative ways
to tackle the company’s burgeoning debt and keep the bottom line in the green zone
despite lowering demand and huge debts accumulated.
Leveraging Information Technology
The entire mining operation of the Company is safeguarded against accident occur-
rence. Proactive measures are undertaken to ensure the employee’s health and produc-
tivity through ergonomically designed workstations and by protecting them from
occupational hazards. All its mines are ISO-14001 -Environmental Management
System Certified. Tata Steel’s collieries use ‘Surpac’, a state-of-the-art mine plan-
ning software that estimates the volume of coal in every seam. This software is
coupled with qualitative detailing that focuses on output consistency. To maximize
productivity and utilization, a voice and data equipped Global Positioning System
is used, which helps to supervise mining activity for machine movement and engine
status.
Proactiveness of TATA Steel with Respect to Its Competitors
Tata Steel has the lowest operating cost for steel manufacture in the world. Further it
has displayed effective means in adopting an eco-friendly and sustainable approach
towards the manufacture of steel thus proactive measures are undertaken to ensure
the employee’s health and productivity through ergonomically designed workstations
and by protecting them from occupational hazards.
Adaptability of the Company in the Fast Change

of the Environment
Tata Steel has displayed immense agility in the recent past during the global financial
tsunami. Its virtuosos of various fields have adopted various methods like lowering
of production and even shutting down of steel plants owing to the lack of demand,
managing the balance sheet efficiently etc. The company has 70% of its procurement
of raw materials for its operations in Asia through long term contracts and so its
margins can be shielded from the nuances of the volatility of the financial markets.
Brand Value
Tata Steel has had an impeccable record for corporate governance. It has set the
benchmark in global corporate governance principles of transparency, accountability
and equity for others to follow. Tata Steel has been consistently receiving prestigious
awards at both the national and the international arena. Recently it bagged the Best
Governed Company Award for corporate practices presented by Asian Centre for
Corporate Governance.
CSR Policy, Initiatives and Interventions
TATA Steel’s CSR policy is guided by its vision to set a global benchmark in value
creation and corporate citizenship. In the company’s social responsibility, it has
always tried to conduct its business responsibly and in compliance with applicable
laws and human dignity. The organization has a long-term CSR goal to increase the
quality of life for the people they represent worldwide through the production of
long-term benefits for all stakeholders.
For the FY 2019–20, TATA Steel undertook an extensive exercise to completely
understand the needs and aspirations of the communities they were going to engage
within the next 10 years. This project facilitated the company’s long-term develop-
ment plan as well as guided their csr policy. The exercise focused on the following
aspects: How societal vulnerability will evolve, what rights-based paradigm for the
vulnerable will look like, how social and environmental concerns will converge, what
will be the role of grassroots governance and leadership and Where business skills
and expertise can play a role in advancing societal well-being.
Tata Steel’s CSR is concentrated on four main areas—employment, hygiene,
livelihoods and rural and urban development—which are in line with Tata Group
priority initiatives (Skill, Energy, Governance, Employment).The company shall also
take steps to enhance the standard of life of the people in the fields of education,
disaster relief, the climate, race, etc. Tata Steel’s focus areas for developmental activ-
ities will be in urban as well as rural areas in the states in which it is located. The
company may also support initiatives in other geographies, as approved by the CSR
& Sustainability Committee of the Board, from time to time. While they ensure that
all communities benefit from our CSR activities, they lay their focus on those groups
that are socially and economically marginalized. These would include women, girl
children and scheduled castes and tribes.
In order to understand TATASteel’s corporate policy interventions critically, it
is important to trace and reflect on the guiding principles for TATA Steel’s CSR
policy. The following are the Guiding Principles for CSR as per Annexure B of the
company’s CSR report:
Impact –All CSR initiatives have well-defined KPIs to measure their impact on the
target.
Independent reviews and feed-back from external stakeholders would be a crucial
feedback for redesigning and/or carrying out future programs for high-impact
ventures.
Partnerships—The Company will develop collaborations with business partners, the
other Tata. Group companies and similar corporate organizations, funding agencies,
non-government.
Organizations, community-based organizations, governments and governments
Organizations, based on well-defined selection criteria. Partners will bring in addi-
tional resources, expertise and influence that would be leveraged to force the
company’s CSR initiatives to multiply.
Tata Steel will participate in close collaboration with Tata Trusts and work together
on initiatives that comply with and operationally complement the CSR strategy of
Tata Steel. With its CSR programs, Tata Steel will also leverage Tata Group’s products
and services in accordance with its CSR strategy.
Affirmative Action—The Company will design modules targeted interventions
for backward classes to promote Education, Employability, Employment and
Entrepreneurship. The Company will also work on promoting Ethnicity to preserve
the cultural identities of these communities.
Volunteerism—Tata Steel is committed to giving its workers incentives.
Families and the broader community of Tata Steel are active in voluntary work
to the benefit of their communities and at the same time promoting Tata Steel’s own
activities in terms of CSR. It not only strengthens links between local communities,
but also draws on in-house resources to address social issues and thereby generates
impacts both social and corporate.
Communication—The business should provide a two-way system of contact so that.
For the purposes of planning and developing projects, stakeholder needs, desires
and preferences can be mapped, and their level of input and satisfaction collected
and evaluated.
Innovation—Tata Steel will strive to develop apparently innovative solutions.
Uncompromising social problems. These include technology and models for the
supply, partnership, and implementation of initiatives.
These guiding principles function hand in hand with the objectives that are devel-
oped to form the CSR policy of TATA Steel. These objectives are about change,
improvement, and societal perspective. Basically, they are to Actualize change
models to address core development gaps in Jharkhand and Odisha, while being
replicable at a national scale (through four signature programmes). Enable signifi-
cant and lasting improvement of communities staying close to our operating loca-
tions (through nine Proximate Community Development programmes) and Embed a
societal perspective in key business decisions as an enabler to ensuring community
interests (through three key approaches).
Additionally, these above-mentioned objectives formed the basis of the various
CSR Projects that are undertaken by TATA Steel. As per the Integrated Report for
FY 2019–20 following are the CSR initiatives and Interventions undertaken by the
company:
• Proximate Community Development (PCD) programmes:
Addressing needs of communities and key stakeholders by:
(a) Ensuring access to comprehensive primary healthcare
(b) Sustained availability of safe drinking water
(c) Enhancing household incomes through agriculture, its associated activities
and skill-based training for employment and entrepreneurship
(d) Enabling basic school education (at least till grade 10) for all children as
well as scholarships to meritorious students
(e) Addressing urban child labour and re-introducing children to educational

mainstream (f) Improving the nutritional levels of families as well as that
of children in public schools
(f) Sensitization of society towards Persons with Disabilities (PWDs);
(g) Nurturing sporting talent
(h) Promoting community self-reliance by deepening grassroots governance
mechanisms in villages, particularly focusing on women leader
• Signature Programmes:
– A society where the health and survival of women and children before, during
and after childbirth is a priority reaching out to 97,000 people
– A society where all children go to school and have access to high-quality
education to prepare them for a successful future covering 12 blocks
– Empowered tribal communities to lead their development agenda, residing in
an ecosystem that recognizes and appreciates tribal values and living, reaching
out to five tribes
– A vibrant Jamshedpur- Kalinganagar corridor where local communities partic-
ipate in and bring about significant enhancement in their social, natural and
cultural capital, reaching out to 25,000 families in 21 panchayats
• Embed a societal perspective in key business decisions: The key initiative to
fulfil this objective was Ensuring community interests are considered in business
strategy by continually engaging our employees across geographies to utilize their
talent and resolve pressing issues faced by communities in daily life
In addition to this initiatives, TATA Steel’s CSR projects cover diverse fields which
are as follows:
• Education
– Setting up and running educational institutions and hostels.
– Setting up and running mid-day meal kitchens.
– Training of teachers and headmasters.
– Improving quality of education in existing schools.
– Augmenting and supporting infrastructure in educational institutions.
– Offering scholarships and financial assistance to needy and meritorious
students.
– Bridging drop-out children and mainstreaming them to formal schools.
– Making adults functionally literate.
– Developing educational material and methodologies.
– Supporting and promoting co-curricular activities.
– Advocacy of best practices.
– Education for mainstreaming disabled children.
• Health
• Setting up and running clinics and hospitals • Running mobile medical vans
and ambulances • Organizing health camps • Providing financial assistance
and waivers for needy patients, on a case-to-case basis • Providing family

planning services • Reducing infant and maternal mortality • Preventing and
treating communicable diseases like malaria, tuberculosis and HIV / AIDS •
Treating and rehabilitating persons with disabilities • Working on adolescent
and reproductive sexual health issues • Promoting awareness about various
health issues and generating demand for health services • Undertaking and
supporting research on health related issues • Ensuring access to potable
drinking water and hygienic sanitation.
• Livelihood
– Setting up and running skill development centres, industrial training centres,
diploma and polytechnic institutes, community colleges, etc.
– Sponsoring candidates for skill development and vocational training
programmes offered at identified institutions.
– Coaching candidates to appear for entrance examinations of different institu-
tions.
– Creating, training and supporting entrepreneurs.
– Creating, training and supporting self-help groups, federations, co-operatives,
societies and similar institutions.
– Building capacities of farmers on improved methods of agriculture and other
allied sectors.
– Developing water harvesting structures and irrigation facilities.
– Supporting farmers with quality inputs, technical know-how and timely
information.
– Creating markets and marketing linkages for farm and forest-based produce.
– Undertaking and supporting research on agriculture and other allied sectors.
• Rural Development
– Rural development projects of building and maintaining community-based
rural infrastructure like roads, bridges, culverts, drains, rural electrification,
water infrastructure, community centres, youth clubs, etc.
• Sports
– Constructing stadia and sports infrastructure.
– Setting up and running academies and sports training centres.
– Organizing sports tournaments and coaching camps for community.
– Supporting sportspersons to participate in state, national and international
events.
– Offering scholarships and sports equipment to deserving sportspersons.
– Promoting adventure sports.
– Preserving and promoting indigenous sports.
– Organizing leadership and motivational camps.
• Ethnicity
– Preserving and promoting tribal languages, scripts and literature.
– Preserving and promoting fine arts and performing arts.

– Preserving and promoting various aspects of folk and tribal culture.
– Organizing cultural events.
– Restoring and renovating memorials, monuments and heritage structures.
– Mainstreaming Particularly Vulnerable Tribal Groups (PVTGs).
– Undertaking and supporting research on anthropological and ethnic issues.
• Environment
– Undertaking plantations and afforestation activity.
– Promoting renewable sources of energy.
– Recharging ground water levels.
– Conserving biodiversity and supporting research, awareness and advocacy on
issues related to biodiversity.
– Promoting awareness about environmental issues.
• Disaster Relief
– Extending relief measures during times of natural disasters, anywhere in the
country.
– Undertaking and supporting rehabilitation measures post-disasters.
• Support to Technology Incubators
– Funding research projects at technology hubs for environmental and social
sustainability.
At the same time, the world is hit by a global pandemic in 2020, as a proac-
tive response to the pandemic progress in India, since the end of March 2020 in
a 10-point Agenda, #CombatCovid-19 TATA Steel has been leading a deep dive
both in the urban and rural communities of Jharkhand and Odisha. The company
made provisions and arrangements for food supply and sanitation, dry rations kits
for disadvantaged populations, offering opportunities to generate profits for local
businesses, Coordinate volunteer support to alleviate citizens’ distress in a situation
of uncertainty, to help migrant workers across India, in conjunction with the provi-
sion of relief materials, and to establish market relations between farmers to ensure
a fair price of their crops through the lockdown process.
Thus, TATA Steel’s CSR initiatives and Interventions actively works to develop
and uplift each and every sector of the society. In order to facilitate a successful as
well as sustainable business.
Impact of TATA Steel’s CSR Initiative
TATA Steel through its CSR initiatives aims to fulfil its responsibility towards the
society and environment which provides the company with its natural and human
resources. As per the TATA Steel’s integrated Report for FY 2019–20 the following
were the impact of their CSR initiatives and interventions:
• Impact of Proximate Community Development (PCD) programmes:
– Over 1 million lives reached through our PCD programmes in FY 2019-20 -
17,032 farmers benefited through agriculture productivity techniques
– 177 water harvesting structures constructed largely for agricultural use and
partly for domestic use
– 700+ children covered from ~3,000, with 189 mainstreamed; 10 residential
and non-residential facilities in Jamshedpur (capacity of 1,000) under Masti
Ki Pathshala
– 5,504 youth enrolled, 2,733 youth trained and 2,197 youth placed/ self-
employed by various skill enhancement programmes
– 311 persons reached through Sabal Centre and various disability linked
programmes
– 14,822 women reached under empowerment programmes through SHGs and
~5,000 women engaged in enterprise development and social activities
– 53,844 youth engaged through different sports activities
– 454 youth experienced outdoor leadership camps
– In response to the COVID-19 pandemic, we reached out to communities
towards the end of March 2020, impacting over 23,000 lives as a precursor
to a coordinated response that eventually reached out to around 8,02,095 lives
in subsequent months
– Local capacity was created to make three-ply cloth masks across our opera-
tional areas to cater to communities most exposed to the outbreak while gener-
ating income opportunities for 1,538 people from vulnerable communities
– Leveraged technology to bridge information gaps and extend sustained support
to frontline health workers and reached 5,763 lives
– A digital volunteering program reached out to 311 people from vulnerable
communities
– Distributed 15,625 warm wholesome meals to those rendered most vulnerable
by the lockdown
• Impact of Signature Programmes
– Reached 58,620 mothers and children and enabled the reach of ASHA system to
their homes—Sexual and reproductive health knowledge to 15,800 adolescents
– ~2,00,000 children’s lives impacted through the Thousand Schools Program
– Almost all blocks in Odisha are now child labour-free zones
– 30,000 members of the community formed child rights protection forums
– 32 community-run Education Resource Centres in Odisha reached 3,400 youth
–25% of the government schools in Keonjhar reached, covering around 5,900
school management committee members, 10,000 children through Learning
Enrichment Program centres and 2,500 children through non-residential bridge
courses under the district saturation model (Keonjhar, Odisha)
Strategies, outcomes and prospective activities for the key objectives of the
Development Corridor project were formulated; detailed village development
and panchayat development plans were uploaded on the DELTA dashboard
developed by Tata Trusts; rejuvenation of infrastructure of 100 anganwadi
centres of the Kolhan region were undertaken—‘Apka Sarkar Apke Dwar’
initiative undertaken to address socio-economic issues.
– Gram Sabhas organised in 34 panchayats involving communities, Panchayat
Raj Institution (PRI) members and opinion leaders to strengthen grassroots
governance mechanism
– 91 PWDs in Jajpur district supported to receive their disability certificates and
learn about relevant government schemes
– 306 facilities estimated at over |6 crore enabled by the district authorities in
the areas of education, Anganwadi and other basic infrastructure
– Orientation and discussions for five districts held with senior district officials;
interactive platforms set up with PRI members and the communities.
• Impact of Embed a societal perspective in key business decisions
– By way of encouraging volunteering to resolve around 200 social issues within
our community in FY 2019-20, we achieved 21,228 volunteering hours - 5,651
volunteers participated and 103 social issues addressed
Additionally, TATA Steel’s CSR activities have touched and improved the lives of
1.4 Million people in the FY 2019–20. At the same time, 58,620 Mothers and chil-
dren covered through the MANSI project and more than 2,00,000 Children covered
through intensive programs in the Thousand Schools project (cumulative for each
year from the start of the project).
Thus, from the impact of the CSR initiatives of TATA Steel it is evident that
they have fulfilled their obligation and responsibilities for social development very
sincerely. Theyhave reached the masses to improve their standard of living, help them
realize their dreams and use their skills. A statement on the www.tata.com website
of the Tata Group says: ‘The Tata credo is to ‘give people back what they have won,’
which is rightly followed and justified by the TATA Steel company by their CSR
interventions and initiatives.
Conclusion and Future Scope
As we navigate through a potentially tumultuous FY 2020–21, Tata Steel stands

firm on its commitment to serve the needs of communities, especially the vulnerable
and marginalized whom we have served for well over a century. The company will
continue to pursue their 10-year plan while being open to community feedback and
contributing to a new way of life. They promise to continue embodying the spirit
of our founder’s immortal words, “In a free enterprise, the community is not just
another stakeholder but the very purpose of its existence.”
It is remarkable that Tata Steel’s CSR has been recognized in several forums.
They have won the prestigious Dun & Bradstreet Corporate Award 2019 for the
fifth consecutive year in the Corporate Social Responsibility (CSR) category. Their
Maternal and Newborn Survival Initiative (MANSI) was recognized at the 14th
National Convention of United Nations Global Compact Network India in May
2019 and was accorded ‘Honorable Mention’ at the National CSR Awards in October
2019. MANSI’s digital response system, ‘Operation Sunshine’ for health workers
to address pregnant women and babies at high risk was selected as State Innovation
Intervention by the National Health Mission (NHM), Jharkhand and the poster was
presented at the 6th National Summit on Good and Replicable Practices and Inno-
vations in Public Healthcare System in India organised by the Ministry of Health
and Family Welfare, Government of India, in November 2019. All these remarkable
achievements truly depict the high-level functioning and commitment of TATA Steel
towards the society and its people. As far as the Tata group is concerned, it has gone
a long way in fulfilling its duty and responsibility towards the society and the nation.
It has reached the masses to elevate their lives, to nurture their dreams. It is also
important to understand that While preparing this research paper Legal aspects like
corporate governance, labor and employee welfare related laws have not been under-
taken so no concrete solutions can be drawn on those aspects. At the same time it
is also important to understand that the framework for CSR, NGRBCs, UNGPs and
NAP for Business and Human Rights, together constitute the institutional framework
for achieving the SDG agenda of 2030.Alternate models and pilots need to be encour-
aged at all levels: partnership governance structures, funding models, and innovative
impact assessment of scaling best practices. Incentives for high-impact social devel-
opment programs/projects that enable us to move the needle on SDGs should be
considered to be implemented. It is clear to think carefully and behave prudently
about CSR to put back and sustain the overall balance in the economic and social
environment. Each organization has a responsibility to humanity, the country and
the planet as a whole that provides both individual, material and natural resources.
For the long-term growth and sustainable development of CSR, the formation and
successful introduction of new policies is necessary to create a harmony between
business environment and community, for the current and the future generation.
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ties.html.
Jet Airways Insolvency: Was It a Black
Swan Event or a Failure in Strategic
Corporate Social Choices?
A. J. Oswald and S. J. Mascarenhas
Naresh Goyal founded Jet Airways on April 1, 1991. In 1992, when the Indian
government reopened the domestic aviation market for private carriers (the Open
Skies policy) by repealing the Air Corporation Act of 1953 that nationalized all air
transports and airlines. And on April 1, 1992, Naresh Goyal incorporated Jet Airways
with Goyal’s stake at 60%, Gulf Air (20%), and Kuwait Airways (20%). It started
flying in 1993. On January 14, 1995, they were granted scheduled air services and Jet
began normal routes competing with domestic and international airlines. Jet started
operations as an air taxi operator on May 5, 1995.
The Open Skies Policy of India created Modi-Luft, Air Sahara, East–West
Airlines, and Damnia Airways. But Jet airways continued to be the profitable market
leader since most of these airlines were either grounded or merged with Jet Airways.
Jet became an international airline in 2004 with its maiden Chennai–Colombo route.
But, despite its early successful years, Jet Airways, one of the largest Airline
Companies in India, suspended its operations on April 17, 2019, after failing to secure
interim funding. How did Jet Airways get into insolvency? Was it its questionable
work ethic? Or, it’s failure in strategic corporate social responsibility (SCSR) to
India and its millions of passenger-customers? Let us trace the roller-skater aviation
journey of Jet Airways for clues that address these critical questions.
A. J. Oswald (B) · S. J. Mascarenhas

JRD Tata Chair Professor of Business Ethics, XLRI, Jamshedpur, Jharkhand, India
e-mail: ozzle@xlri.ac.in

https://doi.org/10.1007/978-981-16-5719-1_7
106 A. J. Oswald and S. J. Mascarenhas
The Genesis of the Problem
In 1996, Jet Airways placed a huge order of $375 million with Boeing (four 737–400
and six 737–800s), as Jet wanted to expand its capacity to carry 2.4 million passen-
gers a year. But, in 1997 when the government of India ruled that no FDI would be
allowed in India’s domestic airlines, Naresh Goyal purchased back the remaining
40% of Jet from Gulf Air and Kuwait Airways (https://en.wikipedia.org/wiki/
Jet_Airways#Fleet_development, https://www.aljazeera.com/indepth/features/dow
nfall-jet-airways-india-premium-airline-crumbled-, 190410123048996.html, Garcia
2019).
By April 2001, Jet Airways listed 30 aircraft and flew 195 daily flights to 37
destinations. However, the company reported its first loss in 2002, despite the fact
that Jet Airways reported a fleet of 41 aircraft operating 250 flights daily by the end
of 2003. By early 2004, the Indian government authorized Jet to run international
operations. Wishing to raise funds for international expansions, Jet went public in
2004, offering 20% of the company to investors. It was listed on the Bombay Stock
Exchange (BSE) and became a public company on December 28, 2004 (https://www.
bseindia.com/bseplus/AnnualReport/532617/5326170317.pdf).
During 2006–2007, Jet bought Air Sahara for $500 million cash and named it Jet
Lite (later, Jet Konnect). With this acquisition, Jet Airways became India’s largest
airline (with 22.5% market share) and joined Star Alliance. When India allowed
FDI up to 49% to incumbent foreign carriers, Jet sold off 26% of its share to Etihad
(https://en.wikipedia.org/wiki/Jet_Airways#Fleet_development).
Jet Airways continued increasing the cost of its resources by buying a mixed
fleet of 10 wide-bodied Airbus A330-200 s and Boeing 777-300ER planes. This
impractical mixing in a small fleet led to increased cost of resources in terms of pilot
training, maintenance, and operations (Beresnevicius, 2019; Mishra, 2019a).
Further, Goyal’s ambitious plan of building planes into palaces resulted
in loss of potential revenues as he decided to have only 308 seats in these
planes instead of global standard of 400 (Lan & Heracleous, 2010). He
wanted to give Jet Airway’s Mumbai–London passengers a 5-Star hotel expe-
rience. This led to his purchasing wide-body aircrafts (Chowdhury & Mishra,
2019; Tanwar, 2019). When revenues started declining, Goyal decided to
increase the seats from 308 to 348, but was adamant on retaining eight first-
class seats (https://www.livemint.com/companies/news/5-things-that-went-wrong-
for-jet-airways-1555488148493.html; Tiwari, 2019). It was too little too late.
To overcome financial problems Jet Airways had to lease out up to 70% of its
wide-bodied aircrafts to other airlines such as Thai Airways, Oman Air, Gulf Air,
and Etihad. Jet executives had to travel for weeks every month in search of airlines
that needed to lease aircrafts. Although Jet Airways was not a leasing company, it
acted like one to stay in business.
In 2013, Jet Airways forged a strategic alliance with Etihad Airways, becoming
the first beneficiary of a policy change that allowed foreign airlines to invest in Indian
domestic airlines. Etihad bought 24% stake for $379 million. Fearing this entry of
Jet Airways Insolvency: Was It a Black Swan … 107
Etihad would imply loss of control for him, Goyal took another big decision on
his own: he used the money he got from Etihad to buy 100 other aircrafts which
eventually resulted in distress (Garcia, 2019).
However, during 2014–2017, Jet Airways began to experience tough compe-
tition when low-cost carriers Spice Jet, Go Air, Air Deccan, and Indigo entered
Indian airline markets. The latter followed no-frills model that enabled cheaper
tickets and higher passenger load factors. Arguably, most of the airline customers
in India are price-sensitive, and thus low-cost carriers began alluring Jet’s
customers (https://www.aljazeera.com/indepth/features/downfall-jet-airways-india-
premium-airline-crumbled-, 190410123048996.html). Jet soon experienced low
yield (especially given hike in oil prices and rupee depreciation). Corporate profits
started to decline as Jet was unable and unprepared to compete with the low-cost
carriers. Indian government also increased aviation fuel taxes that led to increase in
the cost of the fuel. Jet Airways began to dip even into its cash reserves and even
took more debt to stay competitive (https://www.bseindia.com/bseplus/AnnualRep
ort/532617/5326170317.pdf; https://www.moneycontrol.com/financials/jetairways/
cash-flow/ja01).
In 2016, Jet Airways shifted its international base from Brussels to Amsterdam
and signed an “Enhanced Cooperation Agreement” with Air France and KLM Royal
Dutch Airlines in November 2017. By 2017, Jet Airways boasted 119 aircraft, 65
destinations, and 650 daily departures and arrivals.
But despite this brief spurt in performance, Jet started failing and posted net
losses of Rs 1,036 crore by March 31, 2018, Rs 1,323 crore by June 30, Rs 1,297
crore by September end, and Rs 587.77 crore by December 2018. Jet had to borrow
to balance its books and stay solvent. Jet owed money to lending institutions, support
services, aircraft leasing firms, employees, and more. Soon, Jet Airways could not
pay salary to employees and senior management. By 2017, Jet had over 36,500
crores of payables with well-nigh negligible EBIT for recovery (http://www.jetavi
ation.com/content/visionmissioncore-values, https://www.businessinsider.in/jet-air
ways-raised-fraud-bills-faked-invoices-and-siphoned-off-funds-says-report/articl
eshow/70224604.cms, Sharma & Mukherjee, 2019, https://timesofindia.indiatimes.
com/blogs/blunt-frank/jet-airways-fiasco/).
The Final Timeline of Jet Crisis
• January 2, 2019: Rating agency ICRA downgrades Jet’s $1.4 billion debt to D
(Default) after it failed to meet 4Q 2018 payment deadlines on the loans from
banks (led by the State Bank of India) (Trivedi, 2019, https://www.aljazeera.com/
indepth/features/downfall-jet-airways-india-premium-airline-crumbled-190410
123048996.html).
• RBI refers JET to NCLT and on January 17, 2019, NCLT creditor banks discuss
a rescue plan for Jet (Pandey, 2019; Sharma, 2019; Singh, 2019).
• February 21, 2019: Jet shareholders approve debt restructuring, which would
make creditor banks the majority shareholders, while cutting Goyal’s stake from
51% to nearly 25% and Etihad from 24 to 12%.
• March 15, 2019, after grounding a fourth of its fleet, Naresh Goyal sold his 51%
stake in the company in an effort to bail the company. Etihad was unclear if they
would bail out the airline or would simply walk away from the table. Jet managed
to get a short-term loan from lenders as they sold off the stock to keep operations
moving. There was a report that pilots and cabin crew were being asked to work
without pay during this period (Mishra, 2019a; Rajput, 2019; https://www.interm
iles.com/corporate-social-responsibility; Sharma & Mukherjee, 2019).
• March 25, 2019: Banks agree 15 billion rupee ($216 million) bridge loan in
exchange for Goyal’s resignation as Chairman and from the Board, and for his
stake; Goyal quits but the banks do not transfer the loan (Singh, 2019).
• April 5, 2019: Jet Airways’ fuel suppliers cut off the company, refusing to refuel
their planes until they had been paid (https://timesofindia.indiatimes.com/blogs/
blunt-frank/jet-airways-fiasco/).
• April 8, 2019: SBI-led creditor banks invite bids for stake of between 31.2% and
75% in Jet Airways; May 10 is the deadline (2019, November 11; Pandey, 2019).
• April 10, 2019: A plane (operating Flight 9W321) to Amsterdam was seized by
another airline over non-payment of fees. Also, the lessors were planning on
seizing all of the Boeing 777 aircraft used by Jet Airways (Mishra, 2019a; https://
economictimes.indiatimes.com/industry/transportation/airlines-/-aviation/fly
ers-stuck-as-jet-plane-seized-in-amsterdam-before-take-off-for-mumbai/articl
eshow/68826663.cms?from=mdr).
• April 17, 2019: Jet Airways runs out of cash and suspends all flights after failing
to secure desperately needed interim funding. With no means of purchasing
essential commodities to keep their planes in the air, the entire airline was
grounded. Naresh Goyal and his wife Anita Goyal, an Etihad’s nominee, stepped
down from the board (https://timesofindia.indiatimes.com/blogs/blunt-frank/jet-
airways-fiasco/; https://www.moneycontrol.com/financials/jetairways/cash-flow/
ja01; Singh, 2019).
Jet Airways’ Corporate Governance
According to Millon (1990), currently, much attention on the theory of the corpo-
ration is distributed along three dichotomous dimensions (Millon, 1990). The first
dimension is the distinction between a corporations as an entity with a real exis-
tence separate from its shareholders and other participants, and the corporation as
a mere aggregation of natural individuals without a separate existence. The second
dimension is the distinction between the corporation as an artificial creation of state
law and the corporation as a natural product of private initiative. Third dichotomy
that has received less attention is the public/private distinction. This third distinction
has operated at a deeper level, explicitly and implicitly structuring thought about the
nature of corporate activity and the appropriate goals of corporate law.
Judged from a post-factum analysis of Jet’s sad demise, Naresh Goyal seemingly
defined his corporation along all three dimensions with dichotomy choices as follows:
(a) Jet Airways was an entity with a real existence separate from its shareholders
and other participants; (b) he also believed that a corporation is a natural product of
private initiative, and (c) even though Jet Airways was large enough to be declared as
public (or national), Naresh insisted on its private character. All three were deleterious
choices that did away with seeking consultation, collaboration, and delegation and
precipitously spelled its premature and untimely ruin.
Growth in the size of corporations and dispersal of share ownership resulted in
the phenomenon described as the separation of ownership and control by Adolf
Berle and Gardner Means (1932) in their famous book, The Modern Corporation
and Private Property (Berle & Means, 1932). One of the most salient features of
this development was the prevention of active participation by shareholders in the
management of the business. As a practical matter, dispersed share ownership, small
individual holdings, and increasingly complex operations transformed shareholders
from entrepreneurs into passive investors who placed their economic interests in
the hands of professionals. Naresh Goyal’s corporate governance philosophy was
the prevention of active participation by its shareholders in the management of Jet
Airways.
Jet’s Work Ethic Failures
The Dictionary of Business (conceptually) defines ethics as the branch of philosophy

that tries to determine the good and right thing to do, and choices regarding right
and wrong. There is a big difference between what you have a right to do and
what the right thing to do is. The former is legal, the latter is moral. There is a big
difference between law compliance, law abidance, ethical conformance, and moral
engagement. The first is being legal, the second and third are ethical, and the fourth
is being moral and spiritual. We can assess Jet Airways legally, ethically, morally,
and even spiritually. Legality defines legal requirements for Jet; ethicality defines
what was the “right” thing to do for Jet; morality defines how Jet could have done
the “right thing rightly,” and lastly, spirituality defines why Jet should have done the
“right thing, rightly, and for the right reasons.” (Mascarenhas, 2018).
Ethics should inform all things we think, do, be and become. As part of its good
work ethic Jet should have displayed strong ethics in customer relations management
(CRM), in employee relationships management (ERM), in supplier chain manage-
ment (SCM), in distribution partner relations management (PRM), and ethics in
regulation and compliance management. But Jet failed on all five counts. The more
ethical codes and moral principles define and humanize the corporation or insti-
tution, the better are its long-term prospects for sustainable competitive advantage
(SCA).All these operations constitute the work ethic of a company.
Apparently, Jet Airways did not live up to the high standards of work ethic
described above. For example, its work ethic failed at the ERM level: employees
were not paid their long due wages and salaries, even pilots’ salaries were post-
poned. Jet failed also at the SCM level: suppliers of fuel were not paid so much so
they struck and flights could not take off in time. Jet failed also at the PRM level:
Jet tried to rent or lease extra air craft capacity to friendly competitors and they were
unhappy with the deals. Above all, Jet failed to honor long due payables to banks and
other creditors till they refused to supply desperately needed interim funds, which
finally forced Jet into insolvency and death (Mascarenhas, 2019).
Management work-ethic plays a crucial role in the success of any business. Moral
principles take on a special importance in organizational life. Moral principles help
maintain stable social interactions within organizations. That is, principles play an
important role in securing morally sound decisions in organizations.
Moral judgment is a creative process. Jet failed in these Areas and paid the heavy
price of premature demise (Smith & Dubbink, 2011).
In the case of Jet Airways, apart from the competition and adverse market condi-
tions, there were many management work-ethic problems that could explain the
failure of jet airways. Among them:
• Purchase of Air Sahara: Many experts believe the doom of Jet Airways could be
traced back to the 2006 purchase of Air Sahara for $500 million in cash. Naresh
Goyal reportedly made an overpriced deal to purchase that airline and rebranded
it to “JetLite.” JetLite made a huge loss, and in 2015, its entire investment was
written off (Essays 2018; Indiatimes 2007; Timmons 2007).
• Overcentralized Management: Goyal’s autonomous and autocratic manage-
ment style was blamed for the premature death of Jet Airways. As per analysts,
he should have had one team running the full-service carrier and another running
the budget flyer (Gandhi, 2019). Jet lacked a concrete business model and fiddled
with it often, which confused investors and passengers. Goyal was also accused of
making bad investments and failing to address the company’s deteriorating finan-
cial predicament while borrowing heavily (2019, April 17; Iyengar, 2019; Sharma
& Mukherjee, 2019; Timmons, 2007; Tiwari, 2019; Beresnevicius, 2019).
• Failure to attract investors: Aviation analysts said Goyal’s failure to find a
strategic investor to pump money into Jet extended the airline’s losses, contributing
to the financial situation it found itself in. Talks at the end of 2018 with Tata
conglomerate failed, while Etihad Airways reportedly refused to increase its stake
because Goyal was at the helm (Essays, 2018).
• Purchase of Mixed Fleets: Jet Airways purchased a mixed fleet of 10 wide-
bodied Airbus A330 and Boeing 777 planes. Unlike his peers, Goyal decided to
have only 308 seats per aircraft, much lower than the global standard of 400, in
order to give his customers a premium offering. He lost a fourth of the potential
revenue in the process, and the mixed fleet increased its inventory and maintenance
costs (Chowdhury & Mishra, 2019; Lan & Heracleous, 2010).
• Diversion of funds and Fraudulent Billing: The report indicated “prima facie”
the company was involved in “malpractices, mismanagement through siphoning
off funds, preferential and related party transactions, prejudicial to the public
interest” (2019, November 11; Shukla & Dave, 2019; Pandey, 2019; BI India
Bureau, 2019; 2019, April 17; Beresnevicius, 2019).
Major findings of the External audit were:
• Invoices not verified, suggesting excess billing, and fuel expenses reported by
Jet were substantially high for Jet even when stable for other airlines (BI India
Bureau, 2019; Shukla & Dave, 2019).
• Provision for Rs 3,353-crore loan to Jet Lite over 4 years. Both, the Board resolu-
tion and shareholder approval for the provision were not accessible to the auditors
(Shukla & Dave, 2019; Singh, 2019).
• Systematic effort to withdraw money from the company with multiple methods
used from Jet Airways (Gandhi, 2019; https://www.investopedia.com/terms/c/cre
ative-accounting.asp; Pandey, 2019; Srinivasan, 2010).
• Gardi, the director of Jet Airways, appeared in the Panama papers leak which was
also under investigation by the Enforcement Directorate. Gardi reportedly owned
30 shell companies (2019, November 11; Pandey, 2019; Berle & Means, 1932).
Was the Fall of Jet Airways a Black Swan Event that Jet
Could not avoid?
The term Black Swan was popularized by Nassim Nicholas Taleb, a Wharton Grad,
a finance professor, writer, and former Wall Street trader, in his book The Black
Swan (Taleb, 2007). A Black Swan event has three properties: (a) it is extremely
rare, an outlier, lying outside the realm of expectations, as nothing in the past was
anyway like it; (b) it carries an extreme impact, and c) scholars try to explain it post-
factum, mostly to detect and prevent such events. Black Swan is a “highly improbable
consequential event” (2010, p. 18).
So, was the fall of Jet Airways a black swan event? Or were there several minor
black swans that led to the fall of Jet? For instance: the purchase of Air Sahara in cash
for $500 Million that was considered overpriced at that time; subsequent investments
in loss-making JetLite, purchase of mixed fleet, the entry of low-cost carriers in the
Indian market, the increase in crude oil price, and the weakening of the rupee were
independent small swans. Using these events as baseline helps one to understand
the retrospective predictability of the event, as also the severity of impact, and the
work-ethic failure of Jet in the process.
For instance, analysts cited several additional reasons for the fall of Jet Airways
(Gandhi, 2019; Garcia, 2019; Iyengar, 2019; Indiatimes, 2007; Tanwar, 2019; Tiwari,
2019):
• Jet reported net negative cash flows for consecutive years;
• Jet used short-term loans for buying planes causing an asset liability mismatch;
• Jet faced low-cost carrier competition from Spice Jet, Indigo, and Go Air;
• Jet was overoptimistic on prospects as it ordered 225 planes;

• Machine fault in Boeing 737 Max jets forced Jet to ground its B737 Max fleet.
Major wrongdoing in Jet Airways was that it had a highly centralized non-
transparent governance. Goyal had more than a dozen shell companies abroad
and about half a dozen in India. These were used to siphon money from airline
operations by fraudulent means (2019, November 11, Gandhi 2019, PTI 2018,
Shukla & Dave, 2019, https://www.businessinsider.in/jet-airways-raised-fraud-bills-
faked-invoices-and-siphoned-off-funds-says-report/articleshow/70224604.cms). Jet
created changes in the accounting practices to manage the losses and show a
promising picture that kept stakeholders blindfolded. Thus, the Jet top management,
aware of all these nefarious deals, was also aware of the downfall. That is, the fall of
Jet Airways was not a black swan for the perpetrators; it was so for the victims (see
Taleb2010, p. 201–228).
Was Jet Airways a Failure in Strategic Corporate Social

Responsibility?
Traditionally, corporate social responsibility (CSR) has been related to discretionary

or supererogatory activities of the firm to its external stakeholders such as local
communities with their education, sports, arts, and health and hygiene areas of social
welfare. CSR can be justifiably related to the internal stakeholders such as clients
and customers, investors and shareholders, banks and creditors, governments and
legislators, suppliers and distributors, employees and their families, and so on. We
may call this Strategic CSR (SCSR), since it can be part of the overall long term
growth and profit strategy of the firm. In this case, we focus on SCSR of Jet Airways
in relation to its tens of thousands of internal stakeholders that got neglected and
victimized (see Mishra 2019b, Berle & Means, 1932).
Jet Airways has been posting continuous profits since it went public in December
2004. The first signs of financial distress appeared after the acquisition of Air Sahara
and rebranding it as Jet Lite in 2007. The acquisition was considered as the down-
fall of Jet. It took huge debt to finance this all cash deal. The same year Jet posted
a loss of more than 600 crores, highest in its history. This was the beginning of a
streak of losses for eight consecutive years. Was this Jet’s failure in SCSR? (Indi-
atimes, 2007; Tiwari, 2019; https://www.intermiles.com/corporate-social-responsib
ility; http://www.jetaviation.com/content/visionmissioncore-values).
The two airlines operated in two different aviation market segments—Jet Airways
was a full-service carrier while Jet Lite was a low-cost carrier. Operations of
both airlines required different strategies, different price policies and marketing
competencies, and hence, a different focus. Jet did not clearly embrace the need
for differentiation. Was this an SCSR failure as it eventually stranded millions
of customers, pilots and crew? (https://www.livemint.com/companies/news/5-thi
ngs-that-went-wrong-for-jet-airways-1555488148493.html; PTI, 2018; Sharma &

Mukherjee, 2019; Beresnevicius, 2019).
Jet airways management was quite confident that the lenders would keep on
extending their leasing rights and supply aviation turbine fuel (ATF) despite Jet’s
delayed and piecemeal payments. But in April 2019, the suppliers seized the aircraft
and stopped providing ATF (https://timesofindia.indiatimes.com/blogs/blunt-frank/
jet-airways-fiasco/; Iyengar, 2019; Mishra, 2019a; Sharma & Mukherjee, 2019). Was
stretching debts payable beyond reasonable limits and thus distressing vendors an
SCSR flaw?
The Lenders, the SBI being the biggest lender, kept funding Jet Airways despite its
dismal performance and never raised questions to the management on its extravagant
spending. The money lent by SBI is ultimately the money of the common people.
Was this a combined failure in SCSR by the SBI-team and Jet Airways?
Even the long-term planning strategy of Jet to buy 225 aircraft was not a best
decision, keeping in mind the financials of the company. Naresh took decisions
solely based on his discretion. Even after expert advice against this huge order of
planes, Goyal persisted with his decision. It was conveyed to the public that Naresh
Goyal was a visionary decision-maker and was sure of achieving good results in the
near future (http://www.jetaviation.com/content/visionmissioncore-values; Tiwari,
2019). Was this mass delusion of the public a failure in SCSR?
The customers were stranded and frustrated at the airport when Jet Plane was
seized in Amsterdam before take-off for Mumbai (Online, 2019). The employees
agonized when they heard of Jet Airways stopping operations. Customers who had
booked Jet tickets months ago felt cheated. The share prices crashed immediately,
all shareholders suffered huge losses. Was this a failure in SCSR?
Finally, it appears that Naresh Goyal and his top management were not totally
“fooled by randomness” (Taleb, 2001) as believed by some analysts. The only unex-
pected event that happened was a snag in the engine of one of the variants of Boeing
737 Max. It was grounded by the order of Government of India. As majority of Jet’s
fleet was Boeing 737 max, cash inflow stopped abruptly causing Jet to default on its
short-term loans. This perhaps was a black swan that Jet could not foresee or avoid.
Concluding Remarks
“Rags to Riches to misery again” perfectly describes Naresh Goyal’s eventful life.
Born on July 29, 1949, in Sangrur (Punjab) of a prosperous jewelry dealer, he saw
at age 11 financially hard times befall his family. Everything that the family-owned,
including the house they lived in, was auctioned off by the government and the bank,
and all their belongings were thrown out on the streets. Young Goyal experienced
and braved all hardships: he studied under the street lamp light, slept on the floor of
his uncle’s office, his home. His uncle and brother helped him financially through
college, and by 18, he had completed his Bachelors in Commerce from Bikram
College of Commerce, Patiala. He wished to pursue Chartered Accountancy or Law,

but lack of money prevented him from doing so.
Jet airways was one of the biggest airlines in India employing more than 20,000
directly and many more indirectly. Shutdown of such a large airline led to massive
waves of unemployment in the country. Jet’s massive debts led to increase NPAs
in the already fragile banking sector of the country. Also, such an event negatively
impacted capital markets and the trust of people in capital markets, large corporations,
and their business leaders.
At a certain stage, despite of its roller skater journey, Jet had grown so big, it
employed over 20,000, and served over 100 million air passenger customers in India
that it became a public concern with specific social responsibilities to the Indian
public. Jet never realized this additional responsibility. It spelled its own speedy
ruin. Jet’s loss will be long remembered in India. Hopefully, the Indian aviation
industry would have learnt good pointers too, as to what to avoid in the future.
Resources
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Group.
Human Resource Strategies
and Responsible Management: Case
Study of Tea Plantation Workers
in Assam
Ananda Das Gupta
Introduction
The discovery of the tea bush in Assam by Robert Bruce inspired the colonial capi-
talist to make large-scale investments in it. The availability of suitable land and thin
population were favorable conditions for growing tea in Assam, so was the climate
of Assam. The Brahmaputra Valley is perhaps the best tea-growing area of the world
with favorable soil, climate, and topography. Once the problem of land was over, the
planter had to manage the necessary capital. To attract the investors, the colonialist
enacted many laws in their favor. Within two decades, many more companies with
British capital made their entrance in different parts of Assam (Nag, 1990, pp. 51–
52). Between 1859 and 1866, the British Authority cleared the hills of Assam for
new tea gardens and tried to attract huge investments for the industry. Within a few
decades, tea manufacturers in Assam had covered 54 percent of the market in the
United Kingdom and had outstripped China (Fernandes et al.2003).
Faced with labor shortage, the planters had to get workers from other sources.
That is when they began to recruit workers from other parts of India, mostly present
day Jharkhand, Bihar, Uttar Pradesh, and so on, as indentured laborers in slave-
like conditions. This class of people was uprooted from their land and livelihood
by the Permanent Settlement 1793 meant to ensure regular tax collection for the
colonial government. Impoverishment was the consequence. So they had no choice
but to find other sources of livelihood. In the absence of other alternatives, they were
forced to follow the labor contractor and become indentured laborers on the land that
Originally published in Journal of Operations and Strategic Planning, Vol. 1, Issue 1. Copyright
© 2018 International Management Institute, Kolkata. All rights reserved. Reproduced with the
permission of the copyright holders and the publishers, SAGE Publications India Pvt. Ltd, New
Delhi
A. D. Gupta (B)
Flat No. 244, Kengeri Satellite Town, Radiant Enclave, Bangalore 560060, India

https://doi.org/10.1007/978-981-16-5719-1_8
118 A. D. Gupta
Assam’s indigenous communities had lost under the same colonial processes to the
tea plantations. Their initial recruitment was done through professional contractors
who were notorious for abuses and exploitation. The tea garden community folk
songs have passed details of such exploitation down from one generation to another
(Gupta, 1990, pp. 51–53). This labor force has been popularly called the “tea tribes”
and “ex-tea tribes,” and there is debate about this nomenclature, but we shall not enter
into this debate. In 1997, a total of 0.59 lakh laborers along with their dependents
were working in 1,012 registered gardens spread in an area of 0.232 lakh ha, which
is 2.9 percent of Assam’s landmass (Sagar, 2002, p. 1).
The role of the trade union is important. The emergence of trade unions is recent
in the tea industry of Assam. As late as 1946, the planters recognized them on a
differential basis. They identified the ones with whom they could negotiate. But
the planters were well organized from the beginning of 1879. Because of their poor
organization, the workers are dissatisfied with them. It also results in unrest from time
to time, for example, the killing of managers that one has witnessed in recent years.
One sees two main tendencies among the workers. One is their sudden outbursts and
the second, an organized and protracted struggle. One saw the first type in the case of
the Victoria Jute Mill workers in West Bengal in 1993 and the second by the Kanoria
Jute Mill (Debnath, 2003, p. 34).
Social security services generally mean the basic facilities that are necessary for
the mental, physical, and intellectual development of a person. They should include
food, shelter, and health care. Carl Wellman (1985) defined social benefits as some
form of assistance provided to an individual in need. Thus “welfare” or “social
security” is the collective name for all social benefits, especially for groups that
need protection to grow into better citizens. A welfare state has a moral obligation
to ensure the good of all its citizens, particularly the weaker sections. If it cannot
provide all the facilities, it can take the help of other agencies. (Madan & Madan,
1983, p. 163). A human being can lay an ethical claim from his/her society on the
minimum livelihood in the event that he or she lacks the means of sustaining life
because of circumstances beyond his or her control (Wellman, 1996, p. 268). Though
the other welfare measures in their narrow sense do not include education particularly
of the working class, Plantation.
Labour Act (PLA) of 1951 makes an exception to it and includes it among the
amenities to be provided to the workers. We can, therefore, justifiably include it
among their social security provisions.
Sustainability and Human Rights
The concept of sustainability comes from considering the context of the organization.
Leadership sustainability is not just what the leader does but how others are impacted
by the leader’s actions. We judge ourselves by our intentions but others judge us by our
behaviors. Leadership sustainability has to show up not only in personal intentions
but also in observable behaviors. Environmental sustainability is about caring for the
Human Resource Strategies and Responsible … 119
earth’s resources by reducing our carbon footprint. Leadership sustainability is about

caring for the organization’s resources by adapting and changing leadership patterns
so that they are consistent with shifting requirements. Social sustainability is giving
back to the community through corporate social responsibility initiatives. Leadership
sustainability occurs when leaders take personal responsibility to ensure that they do
what they say they will do. Corporate sustainability is a long-term commitment to
changing the world in which we live and work. Leadership sustainability is a lasting
and durable commitment to personal change.
Corporations are increasingly being challenged to act in ways that serve the best
interests of society. Many companies are aggressively seeking strategies that can
allow them to “do well by doing good,” leaving a positive “footprint” on the world
and avoiding actions that could harm consumers, employees, investors, competitors,
suppliers, and the general public. In this series, we will examine how corporations can
become more effective at managing their social impact, improving the relationships
they have with all of their stakeholders in the process. This volume is a unique
combination of theoretical framework combined with livewire cases from the field.
In fact, a volume in this series has been modeled for containing cases exclusively.
This series is academic, accentuated on experiential learning.
By working toward goals like increasing diversity in the workplace, increasing the
benefits for local communities, and increasing performance efficiencies, corporate
ethical behavior envisages to gain a competitive advantage. By demonstrating a more
caring and sustainable approach, the company is able to differentiate itself from rival
mining companies. It makes companies more likely to be the partner of choice for
many governments and communities in the developing world. It also helps with its
position on the stock market. Most long-term investors, such as pension funds that
run investments for millions of ordinary people, believe that it is important for a
company to consider social and ethical issues and not just the financial bottom line
if a business is to be sustainable. Corporate ethical behavior sees shareholder returns
and social and environmental responsibilities as complementary activities. This puts
the company in a stronger position. All stakeholders benefit shareholders, employees,
governments, local communities, and suppliers.
Human rights are relevant to the economic, social, and environmental aspects of
corporate activity. For example, labor rights requiring companies to pay fair wages
affect the economic aspect. Human rights such as the right to non-discrimination
are relevant to the social aspect. And the environmental aspects of corporate activity
might affect a range of human rights, such as the right to clean drinking water.
So, while the primary responsibility for the enforcement of international human
rights standards lies with national governments, there is a growing acceptance that
corporations also have an important role to play. Corporations impact on human
rights in significant ways. These impacts have increased over recent decades as the
economic might and political influence of corporations have grown and as corpo-
rations have become more involved in delivering services previously provided by
governments. Corporations have come to recognize that part of being a good corpo-
rate citizen includes respecting the human rights of those who come into contact with
the corporation in some way.
120 A. D. Gupta
Over the past decade, the international community has made significant advances
in examining and clarifying the links between corporations and human rights. A
wide variety of voluntary initiatives have been developed by individual companies,
industry bodies, NGOs, inter-governmental bodies and multi-stakeholder groups.
These initiatives include voluntary guidelines and codes of conduct, monitoring and
reporting procedures, and socially responsible reporting indexes. Under such initia-
tives, hundreds of corporations worldwide have publicly committed to upholding
specific human rights standards. This illustrates the growing acceptance of the
need for corporations to simultaneously protect the interests of their shareholders,
employees, customers, and the community in which they operate.
The Labor Scenario
The tea industry in India employs more than 1.5 million workers. Every seventh
worker in the organized sector (out of the total estates in India, about 65 percent
estates are owned by the Corporate giants and around 35 percent of the estates belong
to the Proprietors) industries is a tea worker. The tea plantations of Assam and West
Bengal together account for the employment of more than a million workers as well as
about 80 percent of the total production in India. The tea plantation workers, mostly
tribals and lower castes, are the backbone of the tea industry in eastern India. They
are fourth-generation descendants of indentured immigrants brought by the colonial
planters 150 years back from the tribal tracts of Bengal, Bihar, Orissa, and Madhya
Pradesh. Literatures abound depicting the inhuman living and working conditions of
the tea workers during the colonial period. Living and working in isolated plantation
enclaves, they were as good as bonded laborers. Laws existed to penalize the workers
not to protect them. The planters were the omnipotent authority. It was their raj.
With increasing job opportunities for good material, that too in urban areas, the
problem that tea gardens are facing now and which may accentuate in future lies
in the management of tea garden, in that no talented person shall like to make a
career in the secluded life of a tea garden, with problems such as providing good
education to children and job opportunities for spouses, having limited chances of
promotion and a lack of cultural/social activities, and leading a life cut off from
the civilized world. Furthermore, there is hardly any career planning or motivation.
Obviously, the tea garden may have to reconcile with second-class talent to run the
garden even at attractive pay scales and perks. Most of the gardens are also facing
shortage of workforce to harvest green leaf in peak seasons. There is an attitudinal
change in the workers and less number of workers are willing to do manual jobs. The
welfare measures are a major factor as far as productivity is concerned. The laborers
need to be housed well and provided with good medical facilities and amenities. The
Plantation Labor Act stipulates that a plantation with more than 1,000 workers should
have a full-fledged hospital and that the medical facilities should be provided free
of cost. This is vital because the plantation is set up in geographically treacherous
areas. The workers have to work in high altitudes and during heavy rains. Besides
this, they have to walk long distances from home to the workplace. Transportation
is difficult as vehicles cannot ply to all parts of the tea gardens. The plantation is
an outdoor-oriented work in the forests and is highly physically demanding of the
worker. Moreover, the nutritional factors are important. The survey revealed that 100
percent of the workers in the south took normal rice and dhal-based food while non-
vegetarian food (red meat) is consumed at a minimum of once a week and not more
than twice a week. Fresh vegetables are not available in village shops; in addition,
the workers also complain that they have no time to go to the nearest town to make
any real purchases. An interconnected aspect to this is the rest time for the workers.
While they have to leave home early so as to reach the work site in time, breakfast is
not taken or the leftover food is taken in the morning. Rest time during the working
hours came up as an important factor. Absenteeism due to laziness has been reported
by all the field officers and the managers and supervisors alike. The same has been
presented in a different angle by the male workers. They complain of lack of rest
during working hours, and they say that the real-time work is more than eight hours a
day. Mental disorientation was also noticed among all the male and female workers.
The whole lot reported that they are working just for a living, and they do not find any
happiness or pleasure or satisfaction in working in the plantation under the present
wages, housing, and other welfare measures provided. They also add that it is out of
financial compulsion.
In spite of the sporadic efforts being made to improve labor conditions during the
pre-independence days, certain appreciable changes in the condition of plantation
workers took place only after Independence. The first and foremost step in this
direction was the enactment of the PLA of 1951. This Act is a very comprehensive
document and its provisions extend to the health, housing, education, social welfare,
leisure, recreation and working conditions, and so on, of plantation workers. The Act
also intended to bring about uniformity in all matters concerning plantation labor
and, improves their quality of life in all spheres. It provides safeguards for them
against exploitation by regulating their hours of work, rest intervals, minimum age
of employment of children and adolescents and provides for annual leave with wages,
and so on.
Wages
The most striking feature of the Northern and Southern gardens is the difference
in wages. While average monthly wages of the workers in Assam and West Bengal
figured at around ‘48 per day plucking, in Tamil Nadu they were around ‘81 per day
plucking.
The only difference between Tamil Nadu and the two northern states (Assam and
West Bengal) is that workers in the latter are given a part of their wages in kind. They
are given rations of 2.25 kg of rice and wheat per week at a subsidized rate. Workers
in Tamil Nadu are given rations at rates, which are slightly below market rates, but
the quantity is more. The subsidy worked out to be around ‘5 per day.
122 A. D. Gupta
Housing
While comparing the housing conditions in Assam, West Bengal, and Tamil Nadu,
we find that there are similarities between the two former states and differences
with the latter state. It gives a picture that had the employers adhered to the PLA
(1951), all houses would have been made permanent in Assam and West Bengal
by 1969. In Tamil Nadu plantations, however, the houses meet the specifications
of the Act. Again, in terms of sanitation and water, Tamil Nadu plantations have
adequate sanitary facilities. Where each house has a toilet or two houses are provided
with a common toilet, the labor lines in Assam and West Bengal do not have these
facilities. Barring a few gardens maintained and owned by the corporate groups,
access to health services in the gardens in Assam, West Bengal and Tamil Nadu is
not adequate because, by and large, the requirements of the PLA have not been met.
The ill-maintained creches, barring Tamil Nadu, where a better record is available in
maintaining creches, are also a factor in contributing to the welfare of the plantation
laborers.
Women Workers
Women workers, in general, are agitated over their harsh working conditions. During
the plucking seasons, they are forced to work for more than 8 hours—either late
into the night or start very early in the morning. Lactating mothers face a lot of
inconvenience. Even pregnant women are forced into deep hoeing. Women, who
join after maternity leave are not given light work, and the planters do not care a
fig about their health conditions. Subharani, a permanent worker in Baishahabi tea
estate, developed complications immediately on joining work. She could not work
for the next few months. Finally, her job was terminated.
Lack of women supervisors is also a source of trouble for women. Women workers
get apprehensive and work amidst constant fear of sexual harassment and assault,
especially when working in secluded areas or in bungalows of the management
staff. The workers of Baishahabi estate alleged that two girls, Durga and Mani were
raped by the manager in 1996. Durga committed suicide, and Mani is still missing.
The two families have been denied any justice thereafter. Casualization of the work
force is on the rise in the tea industry. Through the decades of 1950s and 1960s,
the number of permanent workers in the Assam tea plantations was reduced by a
staggering 25.61 percent. Within a short span of seven years, between 1984 and
1991, the temporary labor force increased from 170,495 to 268,450 and has almost
touched the 0.3 million figure. Majority of them are women. Women workers have
been gradually shifted to the temporary labor category. According to a member of the
State Women’s Commission, who is a tea worker herself, the planters have resorted to
this ploy “primarily to deprive the women workers of their basic rights as enshrined
in the PLA, such as maternity benefit and medical benefit.” “Many of us are thereby
denied housing, subsidized food grains, provident fund and bonus,” she says.
Medical Facilities
Health and medical care of tea garden workers have been a very controversial topic
mainly because of lack of uniformity. This has invited sharp criticism in the case
of some gardens and appraisal for others. It was only after the passing of the PLA
of 1951 that a uniform Medicare format for tea plantation labor was worked out.
According to the PLA (1951), every tea plantation, employing not less than 1,000
workers is required to maintain a hospital or have a lien on a certain number of
beds available at the hospital on the nearest neighboring plantation. Basic first aid
kit and medicines should always be there even if it cannot provide a hospital or
dispensary. Tea estates must employ necessary qualified staff who work under the
supervision of a medical officer in the hospital of the nearest tea garden. For every
thousand workers, the estate hospital must possess at least 15 beds. Such estates are
required to have a full-time medical officer, a nurse, a midwife, a health assistant, a
compounder (paramedical staff), and a dresser. These hospitals have to be equipped
with an operation theater, a delivery room, an outdoor patient consultation room,
and a kitchen. Other necessary equipment such as oxygen cylinders must also be
there. There should be a separate ward for female patients and one isolation ward has
to be provided as well. The hospital should be equipped with basic and necessary
medicines.
Some small tea estates, especially in Darjeeling Hills, do not have resident medical
officers but they usually have ad hoc arrangements with outside doctors who visit
on fixed weekly intervals. But this is not a very suitable solution because sometimes
for serious and emergency cases it becomes difficult to shift patients to hospitals,
and lack of timely attention can be quite dangerous. Often female patients suffering
from complications during delivery have died because no doctor could be contacted
in time to handle such cases. Hence the government and the industry should find
some better alternatives. The district medical centers and government dispensaries
should be located near such tea estates because there is often a high concentration
of resident population on plantations, including many who are not workers or direct
dependents of workers. Such people often have no access to any medical facilities,
hence both workers and non-workers of such far-flung estates could benefit if such
facilities were provided. Each estate is also required to have at least one ambulance
for sending patients to district hospitals. Now almost all tea gardens have acquired
ambulances.
As in the case of other amenities, the quality of medical facilities and hospitals in
tea gardens differ from estate to estate. Some well-run tea gardens are maintaining
very decent, neat and clean, and well-equipped hospitals with proper buildings and
compounds, whereas there are somewhere medical facilities are nothing but a sham.
This was the case in the early days as well. Some hospitals were just temporary
124 A. D. Gupta
sheds without even a qualified doctor. In those days it was quite common for pioneer
planters and managers to treat tea garden patients themselves. However, with time,
there was gradual improvement and very soon the native “doctor babus” appeared
on the scene.
Methodology: Case Study of Tea Plantations in Assam
Sources of Data
Primary data have been collected from sample tea gardens. Required data have been
obtained from personnel records, drawn from supervisor entries, taking worker day
as a unit of analysis. Observations include the number of kilograms of tea leaf plucked
by each worker.
Literature review
Setting the research objectives
Selection of study Area
Data collection
Data analysis and discussions of results
HRM models for integration, enlightenment

and better productivity options.
Conclusion and decommendation

Source: Field Survey, 2015.
This one number is our measure of productivity.

Attention was restricted to only those days on which pluckers participated and
were assigned to plucking duty. The reason for such focus on actual plucking days is
twofold. First, on days when the worker is absent, there are no means of knowing to
what activity she would have been assigned. That will compel us to assign a missing
value for productivity, rather than a zero, to such an observation. Second, when
workers are assigned to non-plucking activities, there is no comparable measure of
productivity. The tea plantation is made up of a number of fields on which tea bushes
grow in rows. The production of tea leaves—fresh, unprocessed leaves—is labor
intensive. Flushes, each comprising three leaves and a bud, are plucked from tea
bushes manually, either by hand or with metal shears. For the purpose of our study,
this is the final output.
Nature of Data
The basic objective of the study is to examine the impact of social security on the
productivity of tea garden workers. To achieve this objective, five variables had been
taken. Labor productivity is the dependent variable and health security, employment,
financial security, and educational status of workers are independent variables. On
the basis of the survey of literature, the information on various aspects collected are
composition of household, educational background, employment profile, financial
access, and production data of the workers. To estimate the livelihood condition of
the worker, a “social security score” has been calculated. The basic idea of “social
security score” has been taken from (Sarma, 2015). The score has been calculated
taking the following aspects possession of land, housing and other household assets,
garden hospital facility, and particular benefits for workers by garden authority and
financial inclusion. So, 16
Social Security Score = s
i=0i
s1 = Insurance s9 = Blanket
s2 = Bank account s10 = Umbrella
s3 = Medical support s11 = Slipper
s4 = Housing support s12 = Domestic Animal
s5 = Land s13 = Jewelery
s6 = Rice s14 = Bicycle
s7 = Wheat s15 = Firewood
s8 = Bonus s16 = Crèche
Access to any of these benefits is given the value 1 and non-availability has been
assigned value zero. For example, if a respondent prefers to go to a garden hospital
in a health crisis then it is assigned 1 otherwise 0, S = si , i = 1, 2, 3…16.
126 A. D. Gupta
Data Collection
Data Collection Tools
Interview Methods. Personal interviews and group interviews were conducted. One
group session was conducted with an average of 10–12 workers in each garden.
In-depth interviews were conducted with 10 individuals (comparatively educated
person in a workers line) in order to understand and explore the current situation of
construction industry.
Process of Data Collection
Sampling Method. Three important steps have been followed to collect the sample.
The size of the sample was 112.
First step: The workers were covered from five special locations: Chaabua, Duli-
ajan, Maakum, Dibrugarh Town, and Doom-Dooma. These areas had been selected
because they are among high tea garden-concentrated areas, and they are familiar
to the researcher so that the data can be verified in the future if needed. Moreover,
Chaabua is the place where the first tea garden of Assam was established at least
200 years before. That garden also has been included.
Second step: As relevant studies (Sarma, 2015) show that the area covered by
each worker varies with the size of the garden. That’s why our sample had been
divided into three categories size-wise to include that factor. This division also helps
to include ownership of garden factor since our objective is to study the effect of
social security on labor productivity and social security meant for tea garden workers
varies according to ownership of the gardens, which has been mentioned in many
studies on livelihood of tea garden workers. In our sample, all the three large gardens
taken are owned by private companies, and four out of five small gardens taken are
owned by individual owners.
When a population is scattered over a region and complete lists of the total popu-
lation are not available, “clustering” is of assistance in sampling. The sample has
been divided into three clusters, that is, large, medium, and small on the basis of size
of the gardens. A fair representation was tried best to be given to all three segments
of Tea gardens. There are 91 small-sized (10–100 ha), 112 medium-sized (100–400
ha), and 65 large-sized (above 400 ha) tea gardens in Dibrugarh tea district. So, in
that ratio, four small, five medium, and three large tea gardens have been covered
(i.e., 4.5% of each group) for primary survey. Totally 112 workers, both permanent
and casual, have been selected for direct personal interview with close-end questions.
So initially, cluster samplings have been taken giving each category a proportion-
ally equal representation and within a category, random sampling has been done. A
garden below 10 ha has been avoided, because they are too small to deploy permanent
workers to provide social security. That’s why those have not been counted in Laws
meant for tea garden workers.
Third step: Two separate structured schedules with questions have been prepared
(in English). One is for tea garden workers to collect information about their level
of informalization and social security on various aspects of social security. Only
closed-ended questions were included because the study is basically a quantitative
study. There is another schedule for tea garden authorities and supervisors to know
about total figures on parameters for productivity in each garden.
Age estimation was certainly a great problem in the field, where written records
were not available in most of the cases, especially in this community. But age was
corrected in all possible ways such as reference with the important local events of
recent history and of course cross checking from the elderly individuals. The illiteracy
and backwardness of the workers were another big problem while collecting data.
Study Area: Assam
The study was conducted from September 2015 to March 2016. Primary survey
had been done in Dibrugarh tea district (i.e., Dibrugarh and Tinsukia administrative
districts), which is situated on the southern bank of the river Brahmaputra and lies
in the Northeastern corner of Assam. It extends between 94°44 E and 95° E longi-
tudes and 27°3 45 N and 8° N latitudes. It is bounded on the north by the rivers
Brahmaputra and Lohit, on the east by a part of Lohit of Arunachal Pradesh, and the
southwestern boundary of the district runs along the eastern boundary of Sibsagar
district. Population of the district is composed of the members of various ethnic,
linguistic, social, and religious affiliations. Dibrugarh had population of 1,326,335
where male and female populations were 676,434 and 649,981, respectively (Assam
D. o., 2011). Around 30 percent of the plantations of the state are situated here. It is
also estimated that around 25 percent of the population of the district is composed
of tea and ex-tea plantation workers and their dependence. Dibrugarh had 145 tea
estates (Assam Document Office, 2011) (Table 1).
Dibrugarh is the largest tea district in Assam. It has the highest number of tea
estates, highest area under tea plantation, and of course highest yield. Dibrugarh has
total of 22,855 tea estates spread over 95,118 ha of land. Apart from a large number
of small tea growers, conventional tea estates have diverse features in terms of forms
of ownership, industry affiliation, and size. Adequate care has been taken to ensure
that the sample includes all kinds of tea estates, that is, large, medium, and small
tea gardens. The name of the tea estates which are included in the field survey is
mentioned herein as follows:
The primary survey was done Source in Dibrugarh tea district (i.e., Dibrugarh
and Tinsukia administrative districts). There are 91 small-sized (10–100 ha), 112
medium-sized (100, 400 ha), and 65 large-sized (above 400 ha) tea gardens in
Dibrugarh tea district. So in that ratio 4 small, 5 medium, and 3 large tea gardens
have been covered (i.e., 4.5% of each group) for primary survey of total of 112
128 A. D. Gupta
Table 1 Locational and Size Distribution of Enumerated Gardens

Sr Name of the Gardens Ownership District Area (ha) Category of Garden
No
1 Chabua TE Amalgamated Tinsukia 755 Large
2 Glinderth Company Tinsukia 545 Large
3 Rajgarh TE Company Dibrugarh 955 Large
4 Ethelwood TE Company Dibrugarh 145.6 Medium
5 Nadua TE Private owner Dibrugarh 264 Medium
6 Muttok TE Private owner Dibrugarh 325 Medium
7 Madhuting TE Company Dibrugarh 395 Medium
8 Moud TE Private owner Tinsukia 165 Medium
9 Jalpaniya TE Private owner Tinsukia 100 Small
10 Purbipur TE Private owner Dibrugarh 100 Small
11 Hatikhola TE Private owner Tinsukia 11.52 Small
12 Madhuban TE Company Dibrugarh 100 Small
Source Field Survey, 2015
workers. The study has covered 12 tea gardens, namely, Chabua, Glinderth, Rajgarh,
Ethelwood, Nadua, Muttok, Madhuting, Moud, Jalpaniya, Purbipur, Hatikhola, and
Madhuban managed and owned by different management and owners. Chabua is
an amalgamated tea estate with highest share owned by TATA. Glinderth Tea estate
is a joint venture of an MNC and an Indian company Kothari group of industries.
Rajgarh is also jointly owned by two companies, namely, Jindal and Co. and Bajabari
group. Ethelwood tea estate is now owned by an India tea company Jalan group.
Nadua, Muttok, and Moud tea estates are owned by Indian or Assam native owners.
Madhuban and Madhuting tea estates are owned by MNC Warren but managed
by Assam native management. Purbipur and Hatikhola tea estates are owned and
managed by Assam native owners, though their head offices are in Kolkata. It is
based on the assumption that pecuniary and non-pecuniary benefits to the workers
may vary in estates managed by different managements. The gardens are purpo-
sively selected in Dibrugarh and Tinsukia administrative districts of Assam, and
workers are selected randomly. Gardens of size 100 ha or less are taken as small-
sized gardens, more than 100 ha to 400 ha are clubbed as medium-sized garden, and
gardens above 400 ha are considered large-sized gardens. The stated figures on the
number of workers, including both permanent and casual workers, engaged in the
sampled tea estates reveal the prevalence of massive casualization. Here 58 percent
of workers are casual, as indicated in Table 2.
It is discovered that the large-sized holdings depend more on casual workers
(59.25%) and that the intensity of permanent workers is relatively more in medium-
sized holdings. A reasonably larger concentration of casual workers in the small-
holdings is due to the fact that more workers are used to clear the flush during the
peak plucking season. Large gardens have ample spaces and plenty of abandoned
Table 2 Workers in Different Employment Relations

No. of Permanent Percent of No. of Casual Percent of Casual Total
Workers Permanent Workers Workers
Workers
Large 11 40.7 16 59.25 27
Medium 24 42.1 33 57.8 57
Small 12 41.37 17 58.6 29
Total 47 42.59 66 58.4 113
workers in coolie lines. Tea gardens not only differ in their sizes and volume of leaves
produced; they also differ in terms of location. Relatively large gardens are located
near National Highways and more integrated with local economy. So they have more
access to outside workforce. This flexible use of labor is possible because the labor
supply is not constrained in Assam. These linkages are relatively weak in remote
gardens with poor connectivity status.
Despite the poor provisions at work and poor conditions of the workers, the tea
plantation sector of Assam still enclaves the workforce. Most of the workers were
in destitute condition as 49.07 percent workers (53 in numbers) were indebted (see
Fig. 1).
A total of 15 percent of the workers even sell family assets such as animals,
jewelry, or other household products. Field interactions revealed a casual worker or an
unemployed person in the tea plantation area aspires to become a permanent worker
in the estates. A permanent job in the plantation estates provides a regular source
of income and some non-pecuniary benefits. In relative terms, in tea plantations
areas, a job in the sector is still considered as the only possible opportunity for
better livelihood. Figure 1 reflects how opportunities for decent alternative jobs in
plantations areas are limited and how even with a certain level of attainment of
education it is impossible for them to move out for a decent job.
Labor Productivity Differential in Three Categories

of Gardens
One-way ANOVA has been used is to determine if the mean labor productivity is
different in large-, medium-, and small-sized tea gardens [1 = large 2 = medium 3
= small]
H0 = Large=Medium=Small garden in terms of labor productivity
H1 = All the three categories of the garden are not equal in terms of labor
productivity
ANOVA was conducted to compare the effect of size of the garden on labor
productivity of workers in Large, Medium, and Small conditions. Significance level
130 A. D. Gupta
Table 3 Descriptive Statistics of ANOVA

No. of Workers Mean (kg per Std Deviation Std Error Minimum Maximum
Hour)
Large 26 5.12019 1.119978 0.219646 3.500 7.500
Medium 57 6.90351 1.081247 0.143215 4.375 8.750
Small 29 5.04741 1.211650 0.224998 3.125 7.500
Total 112 6.00893 1.442275 0.136282 3.125 8.750
Table 4 Result of One-Way ANOVA Test

SUM of Squares Degrees of Mean Square F Significance
Freedom
Between Groups 92.963 2 46.481 36.731 0.000
Total 230.897 111
Table 5 Tukey
Category No. of Worker 1 2
Homogeneous Subset Test
Subset for alpha = 0.05 Small 29 5.04741
Large 26 5.12019
Medium 57 6.90351
shows H0 can be rejected. There was a significant of size of the gardens on labor
productivity at 99 percent confidence interval for all three categories [F (2, 12) =
36.731P = 0.000] (Table 3).
But a simple one-way ANOVA result only shows the existence of difference
in means. To know which group is statistically different a Post Hoc test, Tukey
Homogeneous Group test has been done (Table 4).
H0 = Large and Small garden = Medium Garden
H1 = Large and Small = Medium.
Means for groups in homogeneous subsets are displayed.
The results show that the mean labor productivity of medium-sized garden is
significantly different from the other two. So null hypothesis is rejected, which
is evident because mean labor productivity in medium-sized garden is 6.9 kg
per worker/hour. And that of large-sized garden is 5, 2 kg per worker/hour and
5.0 per worker/hour. Table 5 shows that in this sample, permanent workers are
proportionately higher in medium-sized gardens.
So higher the permanent workers, higher is the average labor productivity.
Social Security and Labor Productivity
To know the impact of social securities, a regression analysis has been done taking
labor productivity as dependent variable and the social security score as independent
variable. It is a conglomeration of 16 different aspects as defined in the methodology.
Since tea leaf plucking requires unskilled labor, only experience matters more than
education. That’s why experience has been taken as another independent variable
Experience is also a proxy of age since all workers join the almost at the same early
age.
Following this, a multistage regression also has been done to know the aspects
among social securities that matter most in determining the labor productivity.
Wage has not been taken as independent variable nor included in social security
score. Many times money than permanent workers receive is marginally lower than
casual workers. This is because permanent workers very often take loans from garden
authorities, which is taken off at the time of payment. Moreover, casual workers are
more prone to overtime work, so finally receive more money. So inclusion of wage
could give us a misleading result (Table 6).
Empirical Analysis
Regression model
Yi = B0 + B1X1 + B2X2 + B3D1 + B4D1 + Ui

Yi is Labor Productivity Xi is Social Security Score
X2 is Experience in years worked as plucking worker i is no of Respondent, that
is, I = 1, 2, 3, …62
Ui = Well-behaved error term
This model has been used for all three categories of workers (Table 7).
Table 6 Descriptive Statistics of Regression for Small Gardens

Variables Observations Mean Standard Deviation Minimum Maximum
Labor productivity 29 5.068966 1.250262 3.125 7.5
Social Security Score 29 7.758621 3.661139 2 15
Experience 29 13.16667 6.475861 2 30
132 A. D. Gupta
Table 7 Regression Result

Variable Coefficient
for Small Gardens
Constant 3.399*** (0.520)
Experience 0.057 (0.03)
Social security score 0.117* (0.064)
N 29
R2 0.3170
F-value 6.03
Notes*** Significant at 99% confidence level, * Significant at 90%
confidence level (Figures in bracket are Standard Error)
Small Garden
Dependent variable: labor productivity
The regression results show, contrary to anticipation, experience hardly has any
significant impact on labor productivity. But social security has significant impact
on labor productivity. For any increase in social security score labor productivity
goes up by 0.12 kg per worker/hour (Table 8).
Medium Garden
In medium-sized gardens, experience is also has a significant impact on labor produc-

tivity, but its effect is less than social security. Another notable point is R2 of the
regression result. As we moved from small gardens to medium gardens, the R2
became smaller. That will become further less in large gardens (Table 9).
Table 8 Descriptive Statistics of Regression for Medium Garden

Variable Mean S.D Min Max
Labor productivity 6.77 1.15 4.3 8.7
Experience 15.57 6.78 2 30
Social security Score 8.49 3.14 4 14

for Medium Gardens
Constant 5.22*** (0.405)
Social security score 0.106*** (0.05)
Experience 0.034* (0.022)
N 57
R2 0.1951
F-value 6.55
Notes *** Significant at 99% confidence level, * Significant at
90% confidence level (Figures in bracket are Standard Error)
Large Gardens
In case of large gardens, our previous results and conceptual anticipations became
reverse. There is no significant effect of social security on labor productivity. Large tea
gardens in the study also have some other peculiarities also. All three large gardens are
owned by multinational companies. That may be the reason average social security
score in the large garden category is highest. They have better supervisory system.
Their location is also not so remote. But why this result is different for them and what
are other factors that affected the results is a matter of further research. Moreover, in
terms of total area coverage, number of workers engaged, and capital deployed, our
sample for large garden is quite small (Table 10).
Combined Multiple Regression
To overcome the limitations in case of large gardens and to grasp overall picture, a
multiple regression can be done introducing three categories of gardens as a dummy
variable. For this multiple regression data for labor productivity, social security score,
and experience for all three categories of gardens are combined (Table 11).
Table 10 Descriptive Statistics of Regression for Large Gardens

Experience 12.88 5.2 5 30
Social security score 9.05 2.91 5 15
134 A. D. Gupta

for Large Gardens
Constant 4.57*** (0.74)
Social security score 0.005 (0.092)
Experience 0.026 (0.05)
N 26
R2 0.021
F-value 0.25
Source Field Survey, 2015.
Notes *** Significant at 99% confidence level (Figures in bracket
are Standard Error)
Regression model
Yi = B0 + B1 X1 + B2 X2 + B3 Dj + Ui
Yi is Labor Productivity Xi is Social Security Score (Table 12)
X2 is Experience in years worked as plucking worker Dj is Category of Gardens,
where j = 1, 2, 3,
D1 = Large Garden, D2 = Medium Gardens, D3 = Small gardens i is no of
Respondent, that is, I = 1, 2, 3, …112 Ui = well-behaved error term (Table 13).
With a combined large sample, social security score, experience, and category of
garden are three important independent variables that have a significant impact on
labor productivity of tea garden workers. There is 99 percent probability that with
one unit increase in social security score, labor productivity will increase by 0.9 kg
per worker/hour, and this categorically solves the basic objective of the study. And
with one additional year of experience, labor productivity could increase by 0.04 kg
per worker/hour (Fig. 2).
Way Out
Human right is a multifaceted concept. While production is the actual output, human
resource development (HRD) with an accent on human rights is only a means
of achieving the output. It is concerned with an effective and efficient utilization
of resource capital, material, energy, information, and humans. Factors affecting
Table 12 Mean Social

Garden Category Mean Social Security Score
Security Score in Three
Categories of Gardens Large 9.5
Medium 8.49
Small 7.75
Table 13 Descriptive Statistics for Multiple Regressions

Experience 14.33 6.48 2 30
Social security score 8.53 3.26 2 15

of Combined Multiple
Regressions Constant 3.551*** (0.371)
Social security score 0.924** (0.035)
Experience 0.042** (0.017)
D2 1.781*** (0.260)
N 112
R2 0.4827
F-value 24.96
Notes*** Significant at 99% confidence level, ** Significant at
95% confidence level (Figures in bracket are Standard Error
productivity may be (a) technology (b) capital (c) labor quality (d) economies of
scale and (e) resource allocation. Some definitive action plans should now be chalked
out for workers to face the challenges of the millennium in the plantations (Table
14):
1. Continuous and periodically held counseling regarding absenteeism, alco-
holism, productivity, performance, and so on, and educating womenfolk about
small family, childcare, good housekeeping, and health care.
2. Encouraging Thrift by the way of deposits in post office and co-operative
and nationalized banks. At the same time, life insurance policies can also be
introduced as a part of a self-awareness program.
3. Stopping Badli system by providing opportunities/financial support to the
children of the workers and hiring better workers by spotting the right person.
4. Enhancing the role of the Government in setting up Training and Motivational
Centers in plantations.
5. Ergonomic studies are to be taken up for preventing fatigue and enhancing
productivity.
6. Making provisions for facilitating the Women workers (constituting the major
portion in the work force) with equal rights on the economic front, stoppage of
sexual harassment in the work place and providing a cleaner environment for
the general well-being.
7. The “Mothers’ Club” Approach: The original plan was to a have one mothers’
club member for every 20–25 households in the garden. The only qualifications
136 A. D. Gupta
thought for membership were that the women concerned should be literate,
active in community affairs, and enjoy the respect and confidence of the commu-
nity to which they belong. Among the many responsibilities and duties of the
mother club, the important ones are:
i. Each member is to be responsible for 30–35 households
ii. Teaching mothers on weaning food
iii. Education and motivating workers on family planning programs.
iv. Motivating through line meeting and group meetings among women.
v. Arranging immunization programs for children
vi. Looking after pregnant women and arranging antenatal check-ups in
garden hospital. Chlorinating drinking water sources, and so on.
Action by Objective (ABO) Model: Strategic Leveraging
This theory (Das Gupta, 1995; Das Gupta & Sageetha, 2017) exemplifies a method
of self-control and the way of fixing the target with reference to one’s own strength
and weakness to execute the projects. It comprises the sequential conduct of the
following four functions:
1. Reviewing and renovating strategies;
2. Proving a job-improvement plan and congenial work environment;
3. Using present and potential performance review in a systematic way; and
4. Strengthening the ability and enriching the skills of the leaders through Effective
training and development.
In ABO approach, the objectives are handed down with no spirit of authori-
tarianism and as a tool for self-appraisal and self-development. It moves toward
self-reliance, which is having four components: (a) self-confidence, (b) better under-
standing, (c) team spirits, and (d) excellence in work. The whole process increases
the credibility of the review results and performance levels in the participatory
approach under the “bottom-up” theory, under which “Processing” is guided by
ABO objectives.
The concept of ABO is basically based on five principles:
1. Caring for others
2. Helping them to solve the problems
3. This makes the team morally driven
4. The team becomes more independent
This leads the team to self-realization
Thus, the ABO team members are those who:

1. Produce performers
2. Set personal examples; are visible and accessible on the move
3. Find ways to overcome obstacles and

4. Manage them.
Therefore, with the technique of ABO, a work culture can be developed in an
organization which is pointed toward harmonization paradigm which embraces two
aspects:
a. Immediate goal-achievement factors and;
b. Ultimate goal-achievement factors
The immediate goal-achievement factors comprise:
i. Direction setting
ii. Resolution of conflicts and
iii. Team spirit.
These three factors culminate ultimately into ultimate goal achievement, that is,
the self-reliance, the center of a halo from which the following four result-oriented
factors are being diffused:
1. Knowledge-based performance
2. Value-based management
3. Development forward excellence and;
4. Shared goals.
Finally, the work culture dynamics of the HRD depends upon two major factors,
namely,
1. Selection of ABO criterion.
2. Value-based mission—which propagates.
Key Issues
1. Inadequate or poor facilities of housing

2. Poor facilities of drinking water
3. Lack of communication among the workers
4. Interference of belligerent unions for vested interests and not linking wage
increase with productivity
5. Influence of outside agencies (like local political parties to woo votes)
6. Increase in incidence of theft (particularly green leaf) and general rowdiness
due basically to unemployment
7. Insurgency problem
8. Malaria-prone areas
9. Proper implementation of PLA and Factories Act
10. The disproportionate increase in workers’ family population.
138 A. D. Gupta
Way Forward
Proposed Action Plans
1. Workers’ education training and motivation programs for productivity and work
culture development
2. Periodically held health awareness program
3. Implementation of PLA and Factories Act in full
4. To bring about an openness approach in the management style and involve more
people in the decision-making process
5. Population control measures and creativity awareness among the workforce
6. Adequate medical facilities for the workforce
7. Day-to-day functioning may be discussed in a group involving a “leading” group
of workers
8. Encouraging thrift among the workers
9. Children/adolescents of the workers are to be motivated in a positive way.
Need for CSR
Focusing on three key areas for Corporate Social Responsibility can help create a
cohesive map for the present and future:
• Community Relations,
• Training and Development, and
• A Cohesive Global Corporate Social Responsibility Platform
Encouraging Community Relations through the HR team includes implementing
reward programs, charitable contributions, and encouraging community involvement
and practices. Examples of these programs include sending emails and company
newsletters to staff members that highlight employees and managers involved in
community relations or creating monthly reward programs to recognize efforts by
individuals within the company.
Training and Development programs that explain the connection between the
company’s core products or services and the society at large, their value to the local
community, and ways in which employees can get involved in appropriate CSR
projects would sustain and direct these initiatives. The three domains of the triple
bottom line, that is, economic, social, and environmental aspects, are inextricably
linked. Sometimes a slightly more complex model is proposed, a souped-up 3BL
model: the following model is a refinement of the international triple bottom-line
model: people, planet, and profit.
Reviewing and
renovating
strategies
Job-improvement
plan & congenial Self-confidence
work-environment Better
Present and Job understanding
ABO
potential improvement Team spirit
performance
Excellence
review in a
in work
systematic way
Strengthening
the ability &
enriching the skills
From the Processing guided

To the customer
plantation by ABO objective
Feedback based on the four

components of job improvement
Fig. 1 Action by Objective Model. Source Das Gupta (1995); Das Gupta & Sageetha (2017)
The Social Dimension
The social dimension is the one favored by the unions, and the area that needs to be
stressed, because it concerns the unions’ deepest concerns. Some people believe that
social aspects of CSR tend to be neglected or get left by the wayside.
The Economic Dimension
The economic dimension is company-internal and therefore primarily involves

their staff and shareholders, especially via socially responsible investment and an
employee savings scheme. The economic dimension also involves managers, and in
particular, the way they devise companies’ economic policies.
140 A. D. Gupta
• Education for workers

• Identification of potentialities among them
Stimulatory & • Motivation-training to new recruits (both workers &
support managers)
• Involvement of top management in counselling the
workforce.
• Involvement of top management in expansion &

Sustaining diversification
• Establishing of need-based common facilities centers
for training & ‘retraining’ the managers & work
force/group-leaders.
• Conducting “small Business Activity”

Human Values • Putting emphasis on occupational safety, health
centers, housing, recreational facilities & vocational
training for the children of the workers
• Induction of SEWA (self-mastery, Empathy for
juniors, workers directedness, Achievement in
performance) approach in the sector.
• Work culture development, through ABO
(Action-by-objective) concept, developing excellence
in skills and creating different level of “critical
capabilities” among the workers.
Fig. 2 Action plan model. Source Provided by the author
The Environmental Dimension
The environmental dimension is now recognized as an area of corporate responsi-

bility, apart from the government policy, which regards the environment as a societal
problem rather than a problem associated with the world of work. Some confeder-
ations point out that companies’ care for the environment begins with health and
safety in the workplace.
The Cultural Dimension
It includes the cultural dimension in CSR. In fact, it is the only confederation to have
extended CSR to cover this domain. The line being followed in this respect highlights
the need to maintain cultural diversity (Managerial staff).
Four main topics seem to be essential given the current emerging economies
context: development of the role played by workforce representatives, employment-
related issues (qualifications to hedge against unforeseeable economic trends), social
rights (equity), and working conditions (health, remuneration). Many other topics are
mentioned, but less frequently, depending on the countries’ pay and/or organizations
and the progress made in CSR. The main subjects raised are local development, the
environment, governance, chains of production, and outsourcing. A global corporate
social responsibility policy, that is centrally managed, is important to acknowledge
successes and measurements according to accepted standards. Central to measuring
and communicating these results is the use of a web-based human resources infor-
mation system or human resources management system (HRMS) that is available
globally to employees and managers with any web browser. In order to encourage
and maintain a clear and cohesive global workplace, it is critical for the entire global
workforce of a company to be on a single, multi-functioning HR platform, which
allows for distributing a sound corporate responsibility plan.
There is a need to develop suitable devices and attachments to convert their
muscle power to useful mechanical power. Providing them with tools and imple-
ments capable of operating comfortable posture could enhance the productivity of
workers. The tools may be push and pull type weeders, trolley sprayers, and so on.
These mechanical devices generate less fatigue during operation and thus result in
more work output. A man, on an average, spends 65–75 percent of his working time
with manually operated devices. With conventional tools, time spent using them is
high when compared to the amount of work accomplished. During continuous work,
a man can develop horsepower equivalent to about one-tenth of his own weight (0.5
hp). There is need to improve existing tools and devices for efficient utilizations of
energy. The desirable features of a good hand tool should be as under:
1. Ergonomic design to enable operator to work in least tiring posture,
2. Lightness of weight of tool for easy transportation,
3. Easy construction and comfortable operation with tool,
4. High quality of its components,
5. Low cost and facilities for local production of tools.
The working part of a tool should be designed for efficient performance of a job.
The handle is important as it determines the position of worker and method of doing
work. It has been experienced that drudgery and physical exertion are main features
of Indian agriculture, which adversely affect man’s intelligence and ability.
142 A. D. Gupta
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(1st ed.). New Jersey, USA: Rowman and Allanheld.
Swadeshi Mills Limited: Kickstarting
Sustainability
S. Venkataraman
Leaving her office in Gandhipuram, Coimbatore, on a late Saturday afternoon in

March 2018, Chitra Doraivelu was feeling reasonably pleased with the way the day
had gone. Chitra, 32, was the Group Director-Sustainability at Swadeshi Mills Ltd.
(SML). A chemical engineer from NIT Trichy, and an MBA from Ivey Business
School, Canada, with a specialization in sustainability, Chitra and her team had
earlier in the day, completed a successful presentation to the company’s Management
Committee. She had also broadly outlined some thoughts for future plans relating
to sustainability, but these needed to be fleshed out in much greater detail. Her team
was on a high, and the Chairman of the Board was highly appreciative of the team’s
efforts. As she reached her car, she changed her mind, and told her chauffeur that
she would follow on foot. She felt the 3-km walk home might help clear her head.
A Legacy Steeped in History
Chitra was the fourth generation of one of the well-established but progressive
entrepreneurial family groups that had its moorings in the city of Coimbatore in the
South India. Coimbatore was renowned for its rich industrial tradition and crowned by
the epithet ‘Manchester of South India’. The city had seen several industrial firms and
families prosper, especially those with interests in cotton textiles, textile machinery,
general engineering and auto ancillaries. Over time, the industrial ecosystem also
helped spawn several educational institutions in the fields of Arts, Science, Engi-
neering and Medicine. Coimbatore’s somewhat central location and relative prox-
imity to several prominent South Indian cities such as Chennai, Bangalore and Kochi,
S. Venkataraman (B)
Indian Institute of Management, Kozhikode, Kerala 673570, India
e-mail: venkat@iimk.ac.in

https://doi.org/10.1007/978-981-16-5719-1_9
144 S. Venkataraman
easy access to other trade centres, hill stations and pilgrimage centres in South India,
and relatively temperate climate for most parts of the year—all combined to not
only deepen its industrial tradition but also serve as an attraction for several talented
professionals.
Chitra’s great-grandfather, the Late (Dr) Muthuswamy Doraivelu was one of the
revered figures in Coimbatore’s industrial history. Muthuswamy had been involved in
India’s freedom struggle against the British, inspired by Mahatma Gandhi’s call for
the Swadeshi Movement that shaped through the early 1920s. The movement was
predicated on the principle of self-reliance and also called for boycott of foreign
goods by citizens and encouraged them to instead opt for indigenous material.
The movement also inspired several people around India to start thinking in terms
of several cottage industries. An Ayurveda physician by training, inspired by the
Swadeshi thought, in 1923, Muthuswamy travelled to Gujarat to meet Mahatma
Gandhi and stayed as a volunteer at his ‘ashram’ (community settlement) for over
a year. Returning to Coimbatore, he rounded up some like-minded friends to start
several local community initiatives relating to farming and homespun cotton (Khadi);
most of these remained small and localized, but active. Over time, while some of
these enterprises withered away due to natural attrition of some key members, a
couple of them took roots as formal co-operatives and a few transformed into private
enterprises.
Muthuswamy took control of one of these enterprises manufacturing Khadi cotton
products and also invested a good portion of the modest surpluses in building a
small school and a hospital. Much later, these would develop into flourishing insti-
tutions run by a common family trust. Post India’s independence, as successive
5-year plans gave impetus to the development of core industries such as cement,
steel, textiles, mining and heavy engineering, several integrated textile companies
started gaining prominence across India, particularly in Maharashtra, Tamil Nadu and
Punjab. Coimbatore was one of the centres that saw heightened industrial activity
in this backdrop. Muthuswamy continued to grow the business in stages conserva-
tively. In 1970, Muthuswamy’s sons, Krishnaswamy (32 years) and Paliswamy (38
years), convinced their father to move away from khadi and into traditional cotton
textiles and textile machinery—and both these businesses operated as divisions of
the company set up by Muthuswamy, the Swadeshi Mills and Machinery Limited
(SMML). Fuelled by conservative financial policies, both the businesses flourished
over time at a moderate growth rate, and spawned a few related subsidiaries as well,
despite confronting occasional setbacks, cyclicality and volatilities inherent to these
sectors.
A Forced Baptism
As the joint family grew in size, in 1980, Krishnaswamy and Palaniswamy took
an amicable and voluntary decision to bifurcate the business and governance, with
Krishnaswamy managing the textile business with its name fashioned as Swadeshi
Swadeshi Mills Limited: Kickstarting Sustainability 145
Mills Ltd. (SML). Palaniswamy took over the textile machinery business under the
name Swadeshi Engineering Ltd. Given the business synergies, each of them retained
a nominal stake in the other’s flagship company as well as Board positions, but rarely
intervened in each other’s decisions, unless invited to. Muthuswamy also continued
as the titular Chairman of both the groups till his death in 1987, whereupon the
brothers assumed full control of their respective groups.
By 2000, the Krishnaswamy Doraivelu led SML was conducting its business
through three to four group companies, with the separate firm structures introduced
essentially for focus and leveraging some tax benefits granted by the state. But for
all purposes, the group companies acted as if they were one company. Although
Krishnaswamy was grooming his son Kathiravan to take over the reins of SML in
due course, he also encouraged an early transition to inclusion of a professional cadre
at top levels within the group’s business. He had also wished for his daughters, Valli
and Anandi, to be part of the business, but their interests lay elsewhere. Anandi,
the elder, moved to Singapore after her marriage into another business family. Valli
pursued fashion and arts, and eventually moved to Europe. Krishnaswamy always
made it clear that while family heirs might be the natural/first choice for succession,
they needed to earn their stripes through good academic grounding and training.
Kathiravan took his Textile Engineering degree from the famed Alagappa College
of Technology, Chennai and went on to pursue Masters in Science from Rutgers
University, New Jersey. Thereafter, he initially worked in DuPont in their polymer
division and then took up a job with Gap Inc, an apparel manufacturer and retailer.
Upon his return to India after about 10 years in the US, he would spend time in
several key departments like Finance and Production, before being appointed to the
Board as Executive Director in SML. However, tragedy struck the family in 2008.
While on a business visit to Mumbai, Kathiravan was killed in a terrorist attack at
his hotel. Krishnaswamy, although by now 70 and rather shattered by the incident,
had to gather himself and postpone his retirement plans, for the sake of continuity.
Krishnaswamy was aware that he needed to identify and start grooming a successor
soon, and he pinned his hopes on Kathiravan’s daughter Chitra, who struck him
as the ablest amongst his grand-children. She was not only mature for her age,
but given her early moorings in America, was enterprising and empathetic. Even
in a conservative family setting, where women though influential, were generally
accustomed to staying behind the scene, Chitra was a bit of a non-conformist. She
refused to be pigeon-holed with the ladies in family gatherings, always made her
points forcefully, logically and boldly but respectfully in the presence of elders. Her
cousins looked up to her as a ‘leader’ in their collective adventures. A free-spirited
soul, right from an early age, Chitra would often accompany her grandfather and
father to the SML facilities. Growing up, through high school and college, she spent
a lot of her spare time in the factories, observing and engaging with the garment
workers. There were many old hands, who had seen her grow from a toddler to a
young adult. Although she didn’t quite prefer it, the workers fondly used to call
her ‘Chinnamma’ (‘Little Madam’), and was a sought-after guest at many of their
annual community functions and seasonal festivities. They also found in her, when
she was in her late teens, someone who was approachable and willing to listen, for
146 S. Venkataraman
intervening to address some occasional irritants, typically to do with facilities. Chitra

had a tactful way of putting these across for Krishnaswamy’s favourable attention
and intervention. These endeared her even further to the SML community.
At the time of her father’s demise, Chitra had just completed her Chemical Engi-
neering from NIT Trichy and had signed up to work with a multinational firm.
Although initially shaken by the tragedy, she took courage and inspiration from her
grandfather. Krishnaswamy confided in her that while he would continue at the helm
for a while, health permitting, he expected her to take up an active role soon enough.
Chitra was a little apprehensive about this, but over the next several months, Krish-
naswamy would discuss several aspects of the business in greater detail. He also
allowed her to be an observer at the Board meetings, and all this built up her confi-
dence. Meanwhile Chitra started off and continued to work at her MNC job which had
a retail presence. Krishnaswamy was however keen for her to get a formal manage-
ment education, and in 2012, with active encouragement from her grandfather, Chitra
left for Canada, to pursue an MBA from Ivey Business School, Western Ontario. The
school had a strong accent on corporate sustainability. After completing her MBA,
and an extended fellowship that saw her engage with the Ivey Center for Sustain-
ability, Chitra moved to the USA, taking up short stints with apparel firms Patagonia
and Gap Inc. During this period, Chitra also got to meet Dr. Stuart Hart, a cele-
brated academic and consultant in the domain of corporate sustainability. Dr. Hart’s
ideas left a deep impression on Chitra, particularly his concepts related to ‘Beyond
Greening’ and his patented ‘Sustainability Value Framework’. (see Annexure I). This
framework essentially championed the need for firms to evolve from a mode of basic
pollution control (“end of pipe solutions”) to one of product stewardship (“cradle to
cradle”), to Clean technology and Base of the Pyramid strategies. Getting acquainted
with these emerging new concepts about sustainability and furthermore, her stint at
Patagonia opened up for Chitra, a world of immense possibilities with regard to
integrating sustainability into the family business.
“Earn Your Stripes”
In early 2016, Chitra returned to India for good, and as suggested by Krishnaswamy,
right away joined SML, reporting directly to him, but with no formal designation. It
was clear to all stakeholders that Chitra was being prepared for the top job, and that
she would take over sooner or later.
Traditionally, the family had always followed the unwritten rule that except in
emergencies, work was never carried home. But now, at home, after Chitra’s return,
Krishnaswamy, possibly because he feared time running out, would ask Chitra to
accompany him on a short post-dinner stroll around the grounds at the sprawling
family home. Even during these walks, it wasn’t usually formal work-talk, but anec-
dotes from the past. Chitra intensely treasured these post-prandial moments, filled
as they were with instances of empathy, loyalty, enduring friendships and values,
community support and more—stories that were nowhere chronicled. As she vicar-
iously lived these stories, Chitra could identify with the love that she often received
from the staff and factory workers. She could sense the ethos, principles and values
that was the backbone of SML. She made it a point to maintain a journal about these
anecdotes.
At work though, Chitra found in Krishnaswamy, not so much a doting grandfa-
ther, but a demanding boss and a tough coach. He did not cut her any slack, and if
anything, pushed her harder than he would push his professional managers. Chitra
didn’t resent it since she knew this was her formal induction and that despite her
international education and experience, from a practice perspective, she had a steep
learning curve to negotiate. Krishnaswamy told her, “Earn your stripes, just like your
father did. Work in our different departments. Observe and try to understand—more
like a researcher and less like an owner. Don’t be too quick to judge. Remember, we
have several old guard here, as well as some young and aggressive managers. They
may not all be efficient by modern yardsticks, but they bring a certain loyalty and
commitment that is immeasurable. I am sure you may want some changes. Manage
any interventions you want tactfully and sensitively and take my help. But first,
take time to get to know our company inside-out and outside-in”. For the inside-out
bit, Chitra needed to get thoroughly understand SML’s business model, the facilities
the value chain, the key processes, and the key people. For the latter, she needed
to engage with all the constituents of SML’s supply chain (inbound and outbound)
including suppliers, distributors, retailers, and extended stakeholders such as the
local chambers of commerce. Krishnaswamy also wanted her to take a fresh look at
SML’s competitive landscape, and asked the marketing and sales department to give
her all requisite support.
Inside Out and Outside In
Over the next two months, Chitra did exactly what her grandfather asked of her—
getting to know the company ‘inside out and outside in’. The SML group counted
among the traditional integrated mills with presence across the value chain (see
Annexure II) —spinning, weaving and made-ups and presence in both domestic and
export markets.
SML spun cotton yarn across a wide range, from the coarse 30s to the fine 180s.
About 70% of fabric sales came from the domestic market, while the rest comprised
exports to Europe and Middle Eastern countries. The made-ups were largely
exported to the USA and the UK. From its modest beginnings, and growing steadily
over the years, SML’s revenues were now over Rs.1000 crores, and maintained
good profitability.
As Chitra eased herself formally into SMLs operations, as advised, she largely
maintained an unobtrusive presence. She was conscious that her physical presence
in the offices and departments could potentially alter the way the managers behaved,
as she was seen as a family scion and a future CEO. There were people who turned
148 S. Venkataraman
utterly obsequious while there were others who tried to impress. While this was
unavoidable, over a few weeks, she learnt to take both in her stride. She made it
a point to upfront share with the concerned department head that she was there to
observe and learn, rather than to investigate or witch-hunt and requested them to go
about their business as usual. Occasionally, she would request to sit in on meetings,
or accompany incognito on a client call. Every Tuesday, she sat with Krishnaswamy
to debrief him on her observations, analysis and even suggestions, as she tried to draw
on her international and MNC exposure to introduce some process improvements
through basic measures such as equipment balancing, good housekeeping and quality
circles.
A Renewed Focus on Sustainability
In late 2016, after about 6 months on the job, during one of her customary Tuesday
meetings with Krishnaswamy, Chitra proposed that her role be now more focused on
the issue of integrating sustainability into SML. After hearing her out, Krishnaswamy
seemed convinced, but suggested that Chitra first make a formal presentation to
SML’s Management Committee (ManCom) the following week, to get their buy-
in. Apart from Krishnaswamy as Chairman and Managing Director, the ManCom
included the Executive Director, and the Directors of Marketing, Operations and
Finance. During a 2-hour-long session, shortly before Deepavali celebrations, Chitra
first lucidly presented the essential concepts of corporate sustainability (CS) and
corporate social responsibility (CSR), and her observations on SML’s historical and
current status on these aspects. Chitra also discussed issues related to mandatory CSR
provisions that had been introduced recently into the Indian corporate landscape after
the Companies Act Amendment of 2013. According to this, firms beyond a certain
revenue/profit threshold were needed to earmark 2% of their profits for activities that
were designated under this CSR Act.
After a lively discussion, during which some of the ManCom members
also corrected some of her impressions, Chitra summarized SML’s status on
sustainability as follows:
• SML was strictly following all the pollution control norms laid out by the state
and central governments. There had been no violation reported at least during the
last 15 years. Even before that, during the previous 10 years, the only ‘violation’
that had been recorded was on account of an unexpected pipe leakage that had
happened overnight during a massive storm. This was also fixed quickly, and
therefore caused only minimal damage.
• Rainwater harvesting at all its offices and facilities
• As compared to the mandatory 2% demanded under the new CSR act, SML group
was already (and traditionally) spending about 3.5–4%, on greening activities and
social activities.
• Right from 1980, SML had maintained a focus on maintaining clean factory
surroundings and a green belt around its factory and office premises
• From a social perspective, SML always made best efforts to hire from the
surrounding community
• Generous philanthropic contributions and donations, to not only own social
initiatives but also to other community initiatives such as local infrastruc-
ture, temples, community festivities and local schools and hospitals—while
maintaining low-key publicity
• Employees and their immediate family had not only access to statutory privileges
such as ESI but also free or preferential access to special facilities created by the
group—Two schools, one engineering college, two polytechnics/industrial voca-
tional training centres, three clinics and two hospitals that hired topline medical
staff, three community halls around its three factories and three creches and
day-care centres
• SML also sponsored and maintained ten gardens across Coimbatore, Tirupur and
Chennai
• The educational and healthcare institutions established by the group also catered
to the local community beyond employees, and although the services rendered
carried a price, it was reasonably subsidized
Chitra also proposed several new measures that SML could consider to step up its
sustainability efforts. These were unanimously agreed to by the ManCom after some
discussions and adjustments and Chitra also agreed to take up the responsibility of
implementing and championing them throughout the group companies:
• A systematic and time-bound plan for reducing the use of plastic, moving towards
elimination by 2019, in SML campuses.
• A ‘Reduce-Reuse-Recycle’ campaign and movement not only within the SML
facilities, but also within the community
• A garbage segregation plan at factory/office premises as well as at employees’
residences/quarters and other philanthropic institutions promoted/supported by
the SML Trust, including student hostels. This included on the spot incinerating
and on- site composting.
• A systematic plan for further improvement in environmental indicators: Gaseous
emissions (CO2, NOX, SOX), Water consumption, Energy consumption.
• A target to get the SML group to be reporting on corporate sustainability and
enrolled into the UN Global Compact and the Global Reporting Initiative within
15 months, latest by end June 2018, to coincide with the company’s Annual
General Meeting and the Annual SML Day (An event that celebrated SML
families)
• A community ‘clean and green’ initiative that would be run as a volunteering
campaign by SML group stakeholders, including employees, students and their
interested families and friend
At the end of the meeting, the ManCom poured forth their appreciation for Chitra’s
efforts and vision for SML’s sustainability thrust. They approved a special ad hoc
150 S. Venkataraman
budget of Rs. 2 crores to support the additional CS/CSR initiatives and any related
campaigns, over and above what was already being earmarked annually as part of
CSR, with a further commitment to review this budgetary allocation on a need basis.
At the end of the meeting, Krishnaswamy requested Chitra to excuse herself for a
little while. When he called her back into the Board room, he announced, “Chitra, the
ManCom is very impressed with your work, and this is not because you are my grand-
daughter. Of course, I am my very proud of you, and I won’t hide that. We would
like to offer you the newly created position of Group Director—Sustainability. If you
will accept, you may start tomorrow, reporting primarily to the Executive Director.
If you wish, you can think about it, but I would rather like to know your mind now!”.
Chitra was thrilled, as she had not immediately expected such a formal engagement
and appointment. Almost moved to tears, she replied, ‘Thatha, I don’t need to mull
over it. I accept right away, and seek your blessings”. She touched his feet for his
blessings, and also went around to do the same with the others in the room.
New Sustainability Beginnings
Within one month of her appointment, Chitra set up a core team under her, starting
with three young but seasoned managers deputed from within the company—one
from Operations, one from Sales and one from Human Resources. Later, she added
three external hires, one with experienced in sustainability reporting function from
L&T, one MBA from IIM Calcutta with 3-years’ exposure to branding and retail,
and one fresh engineer from NIT, Trichy. Along with the team, Chitra laid out an
elaborate plan on all the action points identified at the ManCom meeting, with detailed
time-bound goals.
By December 2017, with full support from across the organization, SML had made
good strides in almost all of the action points identified. The company’s Towards Zero
Plastic campaign had also moved well, although Chitra felt it was taking time to wean
workers and buyers away from the ‘easy convenience’ of using plastic bags and
bottles. SML provided steel bottles, steel cups, and several water refill points across
its campuses and offices. The SML team also additionally started engaging with the
Coimbatore and Tirupur Municipal Corporations to take initiatives across the districts
for a ‘low-plastic living’, with the assurance of sponsorship and volunteering support
from SML. Once every month, different teams of SML volunteers were engaged in
campaigns such as training and facilitation for garbage segregation, tree planting and
city cleaning.
Metrics were developed to benchmark SML units’ emissions and water and energy
usage, and further targets set for the next 3 years. Proposals were invited from plants
and offices to take up energy efficiency and water usage-reduction improvement
projects. These proposals invariably called for monetary investments, and Chitra
allocated up to Rs.50 lakhs of her ad hoc budget for all such proposals that were
selected after careful screening by an technical and financial committee, that included
herself and the Executive Director as members. In every plant and office of SML, a
Sustainability Champion was identified and appointed in an honorary capacity, whose

role was to enthuse and educate all members at her/his location, clarify doubts if any
and also bring up issues for resolution to the attention of Chitra’s team. By December
2017, Chitra’s team had a draft CS report in place for a sustainability audit by KPMG.
In March 2018, SML’s first CS report was published with a GRI ‘A’, which was a
great accomplishment for a first report. Chitra’s next reporting target would be a GRI
‘A+’. The UNGC engagement and audit was a little behind schedule, but the team
was confident of having it in place before SML’s Annual General Meeting in 2018.
Next Steps
In March 2018, flipping through the printed edition of SML’s maiden CS report,
Chitra was feeling pleased with the efforts and the outcomes. However, glancing at
a framed picture of Hart’s Sustainability Value framework, she knew that what she
had reaped was only the low-hanging fruit, mostly in the pollution-control quadrant.
Hart’s framework seemed to be challenging her, pushing her to zones beyond her
immediate comfort.
While she had achieved some internal momentum within a rather traditional and
conservative family-driven operation, she was clear that much more needed to be
done to move up the sustainability ladder. For instance, wastage in the made-ups
(garments and other retailed items like bedsheets) and retailing were two areas that
hugely impacted the group’s sustainability footprint. Further, she knew that most of
the initiatives so far focused on environmental aspects and even these weren’t fully
integrated strategically with the company’s operations. Embedding social aspects,
going beyond philanthropy, into the company’s strategy was another area that needed
attention. However, all these were not easy areas to tackle, as they would involve
changing deeply embedded practices not only within the group but also with external
stakeholders across SML’s value chain. As Chitra wondered where should start her
next flank of attack, she realised she had reach her home. It was time to keep work
aside.
152 S. Venkataraman
Appendix
Annexure—I
Sustainable Value Framework
(Source: Hart & Milstein, 2003. Creating Sustainable Value. Academy of Management Executive)
Annexure—II
Textile Industry Typical Value Chain
(Source Bair et al, 2016. Bahrain’s Position in the Global Apparel Value Chain. Embassy of Bahrain)
Corporate Influence and the Role
of Corporate Social Responsibility
in Combating Trafficking
in Persons—The India Story
Nayan Mitra, Khushboo Mehta, and Yumna Khan
Introduction
Trafficking in persons (TIP) as a universal concern, has found its place in the UN
Convention on Transnational Organised Crime that has been supplemented by
a Protocol to Prevent, Suppress and Punish Trafficking in Persons, especially
Women and Children, adopted in December 2000. Trafficking, in this Protocol,
has been defined comprehensively as ‘the recruitment, transportation, transfer,
harbouring or receipt of persons, by means of the threat or use of force or other
forms of coercion, of abduction, of fraud, of deception, of the abuse of power or of
a position of vulnerability or of the giving or receiving of payments or benefits to
achieve the consent of a person having control over another person, for the purpose
of exploitation’ (UNODC n.d.). This definition also finds its place in the Palermo
Convention that deals with the Protocol against the Smuggling of Migrants by Land,
Air and Sea, supplementing the United Nations Convention against Transnational
Organized Crime. By March 31, 2019, criminalization of human trafficking was
brought under mandate by 168 countries according to this framework (TIP Report,
2019).
TIP takes place not only for sexual exploitation but also for other types of exploita-
tion. In general, the exploitative situation could be categorized as (a) sex-based and
(b) non-sex-based. While sex-based trafficking includes but not limits to prostitu-
tion, commercial sexual abuse, paedophilia, pornography, cybersex and other types
of disguised sexual exploitation in any form, etc.; non-sex-based trafficking may
comprise of different types of servitude, like domestic labour, industrial labour,
adoption, organ transplant, camel racing, marriage-related rackets to name a few.
However, most of the victims of TIP world over are females—adult women and
girls, who are trafficked for the purpose of commercial sexual exploitation (CSE),
N. Mitra (B) · K. Mehta · Y. Khan

Sustainable Advancements (OPC) Private Limited, Kolkata, India

https://doi.org/10.1007/978-981-16-5719-1_10
156 N. Mitra et al.
Fig. 1 Main forms of exploitation and profiles of detected victims, by subregions, 2016. Source
UNODC (2018)
although this pattern is not consistent across all regions. The United Nations Office
on Drugs and Crime (UNODC) national data depicting the main forms of exploita-
tion and profiles of detected victims, by subregions, 2016 has been represented in
Fig. 1 (UNODC, 2018).
The International Labour Organization (ILO) estimates that there are 40.3 million
victims of human trafficking globally, out of which 81% of them are trapped in forced
labour; 25% of them are children and 75% are women and girls. They estimate that
forced labour and human trafficking is a (United States dollar) $150 billion industry
worldwide (Polaris, 2019).
TIP in India
India remains a key geographical area for trafficking both for sexual exploitation as
well as for forced labour as is evident from Fig. 1. Experts estimate over eight million
people in India are in bonded labour, while ‘millions of people are sex trafficking
victims within India’ (TIP 2019). This is because India is a major source, transit
and destination country in terms of TIP. In 2016, there were 8,132 human trafficking
cases reported in India, a 20% increase from 2015, and there were 23,117 people
Corporate Influence and the Role of Corporate Social Responsibility … 157
Fig. 2 Top states noted for

human trafficking victims in
India, 2016. Source
Bangaloremirror (2019)
rescued from the human trafficking system (Borgen Project, 2019). The data for the
top five states for TIP has been noted in Fig. 2.
In fact, India remains in Tier-2 position in the TIP Report (2019), which implies
that ‘the Government of India does not fully meet the minimum standards for the
elimination of trafficking; however, it is making significant efforts to do so’ (The
Hindu, 2019).
‘Most of India’s trafficking problem is internal, with traffickers targeting those
from the most disadvantaged social strata’ (TIP 2019). This is no surprise. ‘India,
designated as one of the world’s ten emerging markets in 1995 by the Clinton admin-
istration (USA), has over the years, come to be seen as everyman of emerging nations,
an archetype that captures the best and worst tricks of all the most dynamic young
economies (Sharma, 1999). India is a subcontinent and its diversity makes it possible
to assemble almost any picture of the pitfalls and promise of emerging markets, from
the rustic, rural Bharat to the smart cities in urban India. The large states like that of
Uttar Pradesh, with a population of two hundred million, would on its own, repre-
sent the world’s sixth most populous country; and West Bengal, having a population
of ninety million, (Sharma, 2012), make administrative issues complex and multi-
faceted. Moreover, India has an estimated 269.3 million poor residents (2013), out
of which 216.5 million reside in rural India (Rao, 2013), yet, contradicting this, is
the fact that Indian stocks move and down more closely in sync with the global
emerging-market average than the stocks of most other countries do, because its
market is deep and diverse (Sharma, 2012). Hence, there are diversity, complexity
and even contradictions in India, as an emerging nation’ (Chatterjee & Mitra, 2017).
This provides a breeding ground for exploitation and trafficking within India as well
as from India.
‘Forced labor, including bonded labor, constitutes India’s largest trafficking
problem; men, women, and children in debt bondage—sometimes inherited from
previous generations—are forced to work in agriculture, brick kilns, rice mills,
embroidery factories, and stone quarries’ (TIP 2019). They also fall easy prey to
recruitment fraud and exorbitant recruitment fee rackets by labour brokers while
migrating to the Middle East and to other regions. To prevent this, the ‘government
required migrant workers from India going to 16 specific countries, including many
in the Middle East, to receive emigration clearance before departure; it did not allow
emigration to Iraq’ (TIP 2019).
158 N. Mitra et al.
Fig. 3 Top five purposes of human trafficking. Source India Spend (2016)
Even within India, the position of the state of West Bengal is particularly vulner-
able and records the highest number in human trafficking due to its cross-border
with two of its neighbouring countries, namely Nepal and Bangladesh. ‘Traffickers
subject women and girls—predominantly from Nepal and Bangladesh and, to a lesser
extent from Europe, Africa, and Asia—to sex trafficking in India’ (TIP 2019). The
top five purposes for human trafficking have been noted in Fig. 3.
Unsafe migration is a pertinent problem in West Bengal, which also acts as a
source, transit and destination for trafficking both for the north-east states of India
as well as cross border with the neighbouring countries.
The reason for this migration stems from a need for better opportunities leading
to a better life. However, this migration becomes unsafe when people lack socio-
economic empowerment that make them easy prey for human rights abuse. A Human
Right is a legal obligation mandating protection for individuals and groups in a
society. Human rights are not merely wish, hope or desire. It is normally ‘associated
with issues such as human dignity, social justice, access to basic services, peace
and personal security, democratic processes, equality of opportunity and equity in
outcomes’ (UN, 2006), etc. In India, although the Parliament has enacted the protec-
tion of Human Rights Act, 1993 and defines human rights to mean ‘the rights
relating to life, liberty, equality and dignity of the individual, for the rights of
all man and woman alike’, yet the social indicators remain dismal.
In other words, the necessity and desperation for socio-economic betterment by a
disadvantaged/ vulnerable group often leads to human rights exploitation/violation
that provides a conducive environment for TIP. An empirical research was done by
one of the researchers (Mitra, N.) for one of the multi-lateral agencies in the border
districts of West Bengal (source, transit and destination area), some years back and
the followings were noted (the name of the district is kept confidential due to the
sensitivity of the issue):
• The single-most important factor responsible for making women and children
work against their will is extreme poverty (34%), followed by deception (14%)
and lack of education/skill development and death of parents (13%), death of
husband (11%), inhuman torture from family (10%) and forceful abduction
(5%).
• The people responsible for making the women and children work against their
will were the followings, in order of their importance:
(i) Parents (28%),
(ii) Agent (21%),
(iii) Pimps (20%),
(iv) Husband (19%),
(v) Relatives (9%) and
(vi) Neighbours (3%).
43% of the respondents acknowledged about being aware of women and girls
being trafficked for prostitution in their area. But, the other 57% said that they
are not aware of such incidences and showed visible resistance in discussing
further about trafficking. The surveyors reported that there is more to this ‘not
aware’ thing than is visible. The respondents were unwilling to ‘speak out’.
• For the 43% of the respondents who know that the women and children were
sold into prostitution rated the following means in which they perceived how the
women and children got inducted into prostitution in order of priority:
(i) Pimps bring them through deception (25%).

(ii) Through deception by agents in lieu of work (21%).
(iii) Pimps may marry them and sell them forcefully (16%).
(iv) Husbands sell them and put them into prostitution (14%).
(v) They are sold through deception by their husbands/lovers (12%).
(vi) Through rape/sexual violence (1%).
(vii) Go on their own to get rid of family torture (1%).
This reflects on the gross violation of human rights of some of the vulnerable
population and the helplessness/inaction of the peer group, who are incapable of
acting upon it despite the knowledge of the abuse. This is mainly because of the fear
of the powerful, limited resources that results in in-confidence and more importantly
the lack of socio-economic empowerment due to this inequality.
This phenomenon was corroborated again in another action research conducted
among children in prostitution in the red-light areas (transit and destination area) of
Kolkata in West Bengal. In fact, the Trafficking Protection Act of 2000, as amended
(TVPA) defines one of the ‘severe form of trafficking in persons’ as ‘Sex trafficking
in which a commercial sex act is induced by force, fraud, or coercion, or in which
160 N. Mitra et al.
the person induced to perform such an act has not attained 18 years of age’. West
Bengal reported the most children trafficked (3,113), followed by Rajasthan (2,519),
Uttar Pradesh (832) and Gujarat (485) (Business Standard, 2019).
The research revealed that several girls’ hail from outside the red-light area. They
come from economically backward families, irrespective of their locations. Most of
the girls come from medium-sized families of 4–6 members and have dependents
in their house. There is a custom in the family to marry them off at a young age.
Most of these are bad marriages, resulting in divorce, separation or widowhood. The
reasons for divorce, separations are varied, physical torture, sexual abuse, poverty
and existence of alcoholism to name a few. Some of the girls have children from
their marriages. The unmarried girls hail either from the red-light areas (mother, a
woman in prostitution) or have left home early due to some misunderstanding, a
quarrel, mishap or in search of a job. Some of them have even worked as a domestic
help in the city. It is from here, that they are misguided, lured, cheated and sold
into prostitution. Some of the girls are inducted into ‘prostitution’ at the age of
10, even before their menstruation, while the others in their mid-teens. Neighbours,
relatives and friends are instrumental in bringing the girls in ‘this trade (through lure,
misguide)’. This is possible again due to a lack of socio-economic empowerment
due to inequality.
TIP during COVID-19 Times
In the wake of the COVID-19 pandemic since early 2020, this smuggling and
exploitation has worsened as the coronavirus escalated the existing plight of the
weaker and deprived sections of the society. It exposed the social-economic inequal-
ities and raised a health concern all over the world. In India, the lockdown in the
initial months caused a sharp increase in child protection concerns across the country
because people were forced to migrate with their children. Moreover, many busi-
nesses faced cash crunch, shut down whereby the working-class people faced job
losses. This shutting down of business and loss of job has increased the number of
people that require financial assistance to meet their basic needs. This made it easy
for criminals to lure victims by offering them fake employment opportunities.
According to UNICEF, ‘The economic fallout of the Covid-19 pandemic could
push up to 86 million more children into household poverty by the end of 2020’ (The
Hindu, 2020). Many children were rescued from vulnerable situations during the
lockdown as reported by CHILDLINE-1098 in June 2020. Child helplines received
between 100 and 300% more calls with many questions for help around physical,
sexual and emotional abuse during this time (Terre des Hommes, 2020). According
to the government data obtained by the Telegraph (2020), the number of children
trafficked from Jharkhand increased by over 600% in April and May, 2020 during
the COVID-19 lockdown, if being compared to the same two months in 2019. As
per the reports by Indian Express (2020), between March 23 and April 23, 2020, the
West Bengal State Commission for Protection of Child Rights (SCPCR) received 136
Table 1 Numbers of cases of

Month Number of domestic violence cases
domestic violence from
March to July as per National March 293
Crimes Record Bureau April 315
(NCRB) data
May 393
June 461
July (till July 18, 2020) 296
complaints about underage girls being forced into marriage. Activists and govern-
ment officials feared a spike in crimes, including trafficking of women and girls
during this time of uncertainty.
Moreover, to reduce the spread of COVID-19, schools are closed. With no school,
the young girls and boys are becoming more prone to easy deception. On the other
hand, even the sudden onset of online mode of education is also providing a fertile
ground to criminals to sexually abuse children online. Such cases have seen a surge
in the past few months, thus making more and more children vulnerable.
According to the National Human Rights Commission (NHRC), 2582 cases of
human rights violations have been reported in the month of April 2020 itself barely
one month since COVID 19 hit India (Live Mint, 2020). Domestic Violence is also
on the rise worldwide to an extent that the UN Chief Antonio Gutters had to call for
Domestic Violence ‘Ceasefire’. In India, the numbers of cases of domestic violence
from March to July 2020 (The Wire, 2020) has been reported hereunder (Table 1):
This is testimony to the vulnerability of women in India. In fact, a survey carried
out by the Thomson Reuters Foundation (2018) ranked India as the most dangerous
country in the world for women.
Hence, TIP is primarily a derivative of human vulnerability stemming from
poverty, deprivation, inequality, unsafe migration to name a few. Therefore, by
addressing these vulnerabilities, it is expected, TIP can be curbed.
India’s Dilemma
As one of the emerging countries, India confronted its own set of trials. India not
only ranks at the second position in human population preceded by China but also
predicted to be one of the world’s youngest and largest working population by 2026.
Moreover, it holds 129th position out of 180 countries in the Human Development
Index (Human Development Report, 2019), demonstrating that large populations in
India have low educational attainment, lower expectancy rate and less per capita
income (Chatterjee & Mitra, 2017).
India is also home to the seventh largest super-rich population (billionaires) in the
world with 82 billionaires, whose total wealth was estimated to be US $284 billion
(Wealth-X billionaire census report, 2019). Therefore, the population has a great
162 N. Mitra et al.
economic divide with India on the one side and Bharat on the other (Chatterjee &
Mitra, 2017; Mitra, 2014, 2015; Mitra & Schmidpeter, 2016; Mitra et al., 2020).
‘Although, this rise in inequality, to some extent, is natural in the early stages of
economic development (Sharma, 2012), it remains a persistent challenge in many
economies today. In Asia and the Pacific, inequality has risen over the last decade
despite growth rates that have lowered poverty incidence (Son, 2013). Similarly,
in India, although poverty has fallen for every social and religious group in every
state and in rural and urban areas, separately as well as jointly between 1993–1994
and 2009–2010 (Panagariya & Mukim, 2014), yet, the incidences of inequalities are
high. This inequality can pose a threat to growth if it goes unchecked (Sharma, 2012)’
(Chatterjee & Mitra, 2017). TIP is indeed a result of gross human rights violation
due to this socio-economic inequality. Hence, there is an urgent need for inclusive
growth.
‘This concern for inclusive growth, made policymakers increasingly ask age-old
questions about how basic health and education systems can be improved, how regu-
latory systems can function better, who should provide basic services and infrastruc-
ture, and how it should be paid for. This led to a ‘rediscovery’ of underdevelopment,
so to speak, and a realization that something is ‘missing’ in the policy framework
(Graham & Naim, 1997). Thus inequality, earlier measured in terms of income or
consumption, has now got extended to cover many other standards of living dimen-
sions such as inequality of outcomes in health, education, and basic infrastructure,
among others (Son, 2013). But, whose responsibility is it to provide for the same?
It could be the responsibility of the Government to provide a conducive environ-
ment for equality through its social security measures and other policies; and/or, it
could also be the Corporation that takes on the onus in pursuance of their ‘social
license to operate’ objectives. This is often an inconclusive debate, where the
perspectives often differ between the developed countries to the emerging countries’
(Chatterjee & Mitra, 2017).
As the COVID-19 pandemic sweeps across the globe and hit millions of lives,
the world is facing unique challenges; and one of them is lack of financial resources,
as most of the economies are in doldrums due to the economic slowdown which
started even before the pandemic. Given the situation, many Governments and Non-
Government institutions are thinking about innovative ways of dealing with this cash
crunch; and so are corporations.
Corporate Influence and the Role of CSR in Times

of Pandemic
Corporations can have an impact on society not only through their Corporate Social
Responsibility (CSR) programmes but also by being a responsible business. In fact,
during the COVID-19 crisis, business leaders are supporting society in three crucial
ways:
1. Encouraging Mental Wellness

Several companies as well as state and local government suggested that those who
can work from home should do so. Though social distancing affects mental well-
being, it is essential to minimize the containment of this pandemic. That is why a lot
of companies strongly advocate for mental and physical health as Starbucks stated
that up to 20 therapy sessions would be provided to existing employees.
2. Providing Financial Security
In order to provide financial security, companies are ready to assist employees as
many factories closed down due to COVID-19. For example—even though Lulu
lemon shuts down temporarily in North America, it continues to support existing
employees by paying them salaries and giving access to a relief fund. Microsoft
committed to pay its part time workers, although their services have slowed down in
lieu of the pandemic. And other big corporations such as Walmart, Apple and Olive
Garden have upgraded their sick-leave policies to assist support to the marginalized
communities. The Wall Street Journal stated that the confidence of small and medium
enterprises has risen due to coronavirus.
3. Supporting Small Businesses
Amazon declared a US$5 million relief fund for start-ups in nearby headquarters,
whereas Google committed US$1 million to organizations in Mountain View, Cali-
fornia which is gravely impacted by the pandemic. Billionaire Mark Cuban has been
compensating employees who place an order from local restaurants. Though the
implications of COVID-19 are yet to be known, it shall continue to interrupt the
day-to-day lives for months to come. In such uncertain times, the corporate sector
has the power to bring in a paradigm shifts by executing strategies and initiatives
which benefit the society and also provide assistance to employees, customers and
the economy as a whole.
Due to widespread coronavirus pandemic worldwide, many companies stepped
up their efforts by making billions of donations to curtail the spread of the pandemic.
Coca Cola in Philippines is reallocating their US $3 million advertising funds to help
frontline workers of the COVID-19 outbreak. Chevron pledged US $7 million to fight
against coronavirus globally. Amazon’s Jeff Bezos is donating US$100 million to
help local food banks in corona times. Fortune is looking at how companies can
use existing services, infrastructure, products, etc., to stop the further spread of
the COVID-19 pandemic. Several Global 500 companies are making contributions
in following ways: making donations such as PPE or other critical supplies like
planes, masks, etc., giving money for infrastructure, expertise, logistics, manufac-
turing equipment, etc., to carry out clinical research and to share data and technology;
and to take actions to keep workers employed, paid and insured (Gafni, 2020).
Large Technology companies such as Facebook, Salesforce, Apple and Softbank
are making contributions by providing supplies of masks to nearby hospitals. Around
25,000 healthcare workers were provided with free meals and discounted Uber rides
in certain regions of the United States of America who are ready to resolve the
164 N. Mitra et al.
COVID-19 outbreak. Distilleries such as Pernod-Ricard, Bacardi and local distiller

East African Breweries started manufacturing hand sanitizers in uncertain times;
EPZ shifted operations to manufacturing PPE for Kenyans to name a few.
Whether this timely corporate intervention in times of a global pandemic can
be termed as Corporate Social Responsibility (CSR) or ‘business sustainability’ or
‘social innovation’ is indeed a matter of debate. But, since this paper has an element
on CSR, let us understand what CSR is, in the first place. CSR, as defined by the
UNIDO (2020) implies ‘a management concept whereby companies integrate social
and environmental concerns in their business operations and interactions with their
stakeholders’.
Corporate Influence and CSR: The India Story
India amended its Companies Act of 1956 in 2013 where among many other amends,
it has mandated the CSR reporting of their large, stable companies having a net worth
of (Indian Rupee) INR five billion or more, or a turnover of INR ten billion or more, or
a net profit of INR 50 million or more during any financial year and has transited CSR
from a philanthropic and/or voluntary perspective to a more structured, objective and
measurable format for these corporations (Mitra et al., 2018). This is slated to affect
over 16,300 companies with an estimated flow of approximately INR 200 billion
annually into the economy every year; thus, shaking the foundation of business and
society at the same time, affecting the country at a multi-stakeholder level (Mitra &
Schmidpeter, 2016). In fact, with the help of growing investment in CSR, India has
the potential to bring a transformation in social, economic and environmental areas.
The Act recommends (Pricewaterhouse Coopers, PWC 2013) that CSR activities
should be managed like any other managerial disciplines: with sincerity; as part of
normal operations; and integrated with other corporate objectives to provide some
return or benefit for the organization providing it. It should be operated like an
ongoing continuous 12-month rolling project and contain (among other things) a
need-based assessment; a baseline survey or study; clearly identified time frame;
specific annual financial allocation; clearly identified and measurable milestones
and objectives; robust and periodic review and monitoring; and, be evaluated and
assessed by or together with a third party where possible (Isaksson & Mitra 2019).
This CSR mandate has been created ‘FOR INDIA, BY INDIA, IN INDIA’,
keeping in mind the unique Indian context and is ‘LINKED TO THE INCLUSIVE
DEVELOPMENT AGENDA OF THE NATION’ (Chatterjee & Mitra 2016).
COVID-19 has shown the insufficiency of the healthcare system worldwide as
well as exposed the tensions prevailed to curtail the spread of the pandemic. In order
to mitigate this humanitarian crisis, the Government of India needed an emergency
funding. Hence the PM CARES Fund was built to mobilize all available funding
towards COVID-19. On March 23, 2020, the Ministry of Corporate Affairs issued a
statement that diverting CSR funds towards COVID-19 would be considered valid
under CSR. In addition to this, on March 28, 2020, the Ministry of Corporate Affairs
issued a notification making it clear that—‘Contribution to the PM Cares Fund is

entitled CSR activity under item no. (viii) of the Schedule VII of Companies Act,
2013’. This step accelerated the speed and scale of CSR response to the COVID-19
pandemic in an unparalleled way.
Corporate India donated approximately INR 53,240 million to PM CARES Fund
as a part of their CSR activity. Apart from this, approximately INR 25,290 million
has been assigned to take up measures to aid marginalized communities, healthcare
workers, employee welfare and efforts working towards central government. This
advocates that out of the annual average spending on CSR (INR 150,000 million),
more than half has already been mobilized towards India’s COVID-19 response and
preparedness.
Some of the cases of corporate benevolence by select Indian Corporations in the
times of the COVID-19 pandemic are as follows:
1. Reliance Industries
• The biggest meal distribution program ‘Mission Anna Seva’ allocated more than
50 million meals and food provisions in 75 districts across 16 states and 1 Union
Territory;
• A 100-bed allocated COVID-19 hospital built with Bombay Municipal Corpo-
ration (BMC);
• Free fuel for roughly 14,400 emergency vehicles across 249 districts in 20 states;
• Manufacturing of more than 100,000 PPEs and masks a day;
• INR 5,000 million to PM CARES Fund; and
• INR 460 million towards various other COVID-19 relief funds.
2. Indian Oil Corporation

• Medical Insurance for 323,000 pump attendants, delivery boys, (Liquefied
petroleum gas) LPG drivers and POL at INR 226.8 million for 1 year; this amount
assured INR 100,000 per family of four for any COVID-19 related treatment.
• INR 2,250 million to PM-CARES Fund.
3. Tata Steel Foundation

• A comprehensive ten-point COMBAT-COVID-19 CSR programme.
4. Tata Consultancy Services

• Providing COVID-19 patient trackers, health kits, ventilators for the poor
persons.
• TCS iON digital classroom software inspiring students to make a shift towards
E-learning.
• Education on preventive measures to halt the spread of the virus.
5. Larsen & Toubro

166 N. Mitra et al.
• Budgeted INR 5,000 million/month as wages to help the well-being of 160,000

contract workers.
• INR 1,500 million to the PM-CARES Fund.
6. HDFC Bank
• INR 1,500 million to PM-CARES Fund.
7. Mahindra & Mahindra

• Mahindra & Mahindra provided to change Mahindra resorts into care facilities
for COVID-19 patients.
• Mahindra Foundation, the CSR vertical is working towards building a fund to
aid stakeholders facing economic crisis because of the lockdown.
8. NTPC
• Partnered with the Ministry of Textiles to import 23 machines from China to
manufacture PPE kits.
• Assured 1 million meals for labourers, feeding 50,000 abandoned dogs.
• Rural communities were allocated more than 100,000 masks, 15,500 soaps and
sanitizers. Apart from this, imported 200,000 N95 masks will be provided to the
government.
• Engaging with district hospitals and helping them with medicines, disinfectant
sprays and medical gears. Assisting Apollo Hospital’s 24/7 helpline to teach on
essential health information and instruction.
In the last few months, many big corporations have joined their hands to combat
this pandemic. For example, ITC Limited has constructed a contingency COVID-19
fund to assist financially to the primary healthcare centres in rural India. Infosys
pledged to donate INR 5000 million for PPE kits, masks, ventilators and needy
people. It has also made collaborations with Narayana Hospitals to make available
100 bed quarantine facilities. One of the ventures, the Samhita Model is working
continuously in aligning with the CSR efforts towards minimizing the impact on the
casual labourers. They are working with the India Workers Alliance helping Direct
Fund Transfers to beneficiary bank accounts and access to government schemes and
loans. This pandemic has brought into action the need for technological intervention
to curtail the spread, testing, Research & Development (R&D) towards finding a
cure, assessing the effectiveness of the lockdown.
While whether all the acts of benevolence/innovation by the Corporates in an
unprecedented time of emergency due to a global pandemic will be considered as
CSR, as stated earlier, will remain a topic of debate; however, these acts do aim to
minimize the vulnerability of people and hence affect combatting of TIP.
Limitations and Scope
The limitation of this study defines the scope for further study as well. This study
concerns itself only to the social issues of TIP in India, whereas TIP is a universal
concern. Thus, similar studies can be conducted in all the countries that faces such
issues. Moreover, this study could not quantify the role of CSR in combatting TIP in
India. This is because this is a conceptual paper and it has not been quantified through
impact assessment. This can happen, if the incidences of trafficking decreases over
a period. It may be a great idea to do another similar study on the years to come and
build it up as a longitudinal research.
Conclusion
This is one of the first papers in India that talks about the role of CSR in combatting
trafficking. The Business sector had, for so long, guarded itself from the social sector.
As a result, inequality grew drastically as is evident from various publicly available
social indicators; and inequality brought in gross human rights violation.
Moreover, the COVID-19 has further aggravated the vulnerability of certain
classes of people; but this should not be an excuse to allow traffickers to shift their
tactics during this global health crisis and continue to act with impunity. It is incum-
bent upon every civilized nation of the world to provide the resources necessary to
stop these reprehensible and contemptible crimes.
While the Government has taken certain steps to combat this situation for instance,
in India the Ministry of Home Affairs has written to States and Union territories to
expedite the setting up of new anti-human trafficking units (AHTUs) and upgrade the
infrastructure of existing ones to ‘combat and prevent’ human trafficking (Hindustan
Times, 2020). Moreover, ‘the National Commission for Protection of Child Rights
(NCPCR) has suggested to states to map all vulnerable families, particularly migrants
and children at risk and link them to the 37 schemes of the government, including the
ones under Atmanirbhar Yojana announced by Prime Minister Narendra Modi, to
counter economic distress. After two consultations, the letter prepared with recom-
mendations put local bodies and community organisations at the forefront of this
fight, asking them to keep a keen watch on households with children’ (The Economic
Times, 2020).
Similarly, the new Corporate Social Responsibility (CSR) Mandate under the
Companies Act, 2013 that compelled the corporate sector to contribute to the
national developmental sectors also works towards inclusivity and thereby combating
inequality. This act of empowerment through various interventions is likely to affect
the root causes of trafficking over the years. Not only this, they can also help to
rescue, rehabilitate, repatriate the trafficked victims and other vulnerable profiles
together with the government to bring about holistic reform. Only when the various
stakeholders in the society work together, can there be transformation. The mandated
168 N. Mitra et al.
CSR is only the first step in including the Corporates into the larger social ecosystem.
The effort has begun, the consciousness has been implanted, the impact is yet to be
measured.
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Organ Donation as CSR Activity: A Case
on an Innovative Co-Initiative
by Mindtree & MOHAN Foundation
Joy Mukhopadhyay and Arka Ghosh
Understanding CSR
The Corporate Social Responsibility (CSR) concept is a relatively recent

phenomenon. Philanthropic activity by industry houses started with the advent of
industrialization (Banerjee, S. B., 2008). However, CSR lately gained a lot of impor-
tance after the Government of India (GOI) brought in a law. Controversies are
surrounding the intent as well as the extent of these activities, but still, many compa-
nies in India are increasingly getting involved in CSR activities (Lin, T. C., 2018).
Organizations are also encouraging and coaxing their stakeholders for the same.
The most popular activity, of course, is some form of donation, either money or
discarded items like clothes, utensils, etc. The most preferred way is, of course, the
former because of the apparent flexibility liquid cash offers to the beneficiary. Some
companies are encouraging their employees to donate to one day’s salary toward
national and private funds set up to help people during natural calamities. The latter
is typically observed in special Daan Utsav or the event of natural disasters. However,
the donation of eyes and other body organs is a comparatively new phenomenon and
needs serious attention in the purview of CSR activities.
J. Mukhopadhyay (B)
ThinkCorp Consultancy Services, Kengeri Satellite Town, 836, 1st Cross, 3rd Main, Bengaluru,
Karnataka 560060, India
A. Ghosh
XLRI–Xavier School of Management, Jamshedpur, Jharkhand 831001, India

https://doi.org/10.1007/978-981-16-5719-1_11
172 J. Mukhopadhyay and A. Ghosh
Definition, Categories, and the Four-Part Model of CSR
The simple definition of CSR is that it “is a type of international private business
self-regulation that aims to contribute to societal goals of a philanthropic, activist,
or charitable nature by engaging in or supporting volunteering or ethically-oriented
practices.” (Sheehy, B., 2015).
United Nations Industrial Development Organization (UNIDO)1 has been trying
to popularise the concept universally amongst businesses. It defines CSR “as
a management concept whereby companies integrate social and environmental
concerns in their business operations and interactions with their stakeholders.”1
The concept takes the form of the Triple-Bottom-Line Approach in economic,
environmental, and social directions (Williams, C., & Aguilera, R. V., 2008). It is
important to note that CSR is slightly different from just charity or philanthropy
since CSR can be used as a business management strategy (Armstrong, J. S., &
Green, K. C., 2013).A suitable CSR strategy is highly beneficial to a company. It
adds a new positive image about the company in the minds of all stakeholders,
which results in higher sales and patronage by customers, higher productivity, and
quality of work from employees as a result of pride and loyalty, increased brand
recognition and loyalty, and in several other intertwined aspects (Hull, C. E., &
Rothenberg, S., 2008). The most touched upon issues are often the most pressing
ones on the society—environmental management, responsible sourcing, working
conditions, employee and community relations, human rights, ethical behavior, good
governance, etc. (Rangan, K. et al., 2015).
CSR can be integrated into the management strategy of a company (McWilliams,
A., & Siegel, D., 2001). It gives an excellent opportunity for the company to establish
and strengthen relationships with all stakeholders at different levels (Becker-Olsen,
K. L. et al., 2006). It supports the concept of giving back to society. It creates a
positive impact for everyone (Kotler, P., & Lee, N., 2008).
CSR is a type of self-regulatory business plan, with initiatives focusing on
achieving economic, social, and environmental benefits for investors, employees,
customers, and other stakeholders (Berens, G. et al., 2007). It encourages companies
to conduct all their dealings ethically (Gond, J. P., & Moon, J., 2011). It leads to a
positive impact on society and ensures a sustainable growth trajectory for the firm.
Sustainability is essential for any business and is an integral part of CSR. Many may
think that sustainability is important only in terms of environmental sustainability.
However, the reach of sustainability is much broader and encompasses many other
aspects. It is very well applicable to sourcing materials and services from vendors,
recruiting and training employees, etc. (Shumate, M., & O’Connor, A., 2010).
There are statutory and regulatory authorities in all countries which regulate and
govern businesses. A company must abide by the rules and regulations of such
authorities. By just observing such rules, though mandatory and appreciable, does
not qualify for CSR activities. CSR should try to achieve beyond those rules. Many
1https://www.unido.org/our-focus/advancing-economic-competitiveness/competitive-trade-cap
acities-and-corporate-responsibility/corporate-social-responsibility-market-integration/what-csr.
Organ Donation as CSR Activity: A Case on an Innovative Co-Initiative … 173
Fig. 1 CSR Framework and its cruciality for brands
companies shy away from CSR because of the initial and running costs involved. But
that is a short-sighted approach. In the long run, a company will get higher revenues
and profits, justifying and returning the initial investment quickly (LLP, G. T. I.,
2014).
CSR increases investors’ trust (McWilliams, A., & Siegel, D., 2000). It leads to
an increase in long-term profits sustainably and ethically by taking ownership of
corporate decisions and improving them (Johnson, Z., 2018). It can be achieved in
various ways, like making the workplace better for the employees and engaging in
philanthropic activities (Fig. 1) (Orlitzky, M. et al., 2003).
CSR can be divided into three categories, namely environmental, ethical, and
philanthropic. Let us now briefly delve into these.
Environmental CSR
It is a common phenomenon where many focus their CSR efforts toward reducing
their impact on the environment. It has become increasingly important in terms of
global climate change issues. There is an international standard, ISO 1400, which
is particularly for environmental management. Getting the certification is no way
compulsory, but companies strive hard to achieve this certification, thus showing their
responsible behavior toward the environment. Companies are becoming conscious
about carbon dioxide emission, and reducing the emission is also a financial benefit
in terms of carbon credit.
In this context, the world leader in FMCG, Unilever, headquartered in the UK,
leads here too by example. In 2014, Unilever changed the design of its deodorant
can. It made the can smaller, thus cutting the carbon footprint of each aerosol spray
by 25% per can. It was achieved by using 50% less propellant gas and 25% less
aluminum. The new design lasted the same period as the old design. Moreover,
because of almost half the size, more cans could be packed in transporting trucks. It
meant a smaller number of trucks for transport, thus achieving lower emissions.2
Ethical CSR
It is for ensuring that all stakeholders, from customers to employees, receive fair
and unbiased treatment. Of course, this is a self-enforced initiative that a company
adopts not merely because of any obligation but rather for the sense of morality.
Any company considers economic and legal responsibilities as the most important.
Beyond these, a company should focus on ethical responsibilities.
Common examples of ethical treatment of employees are a fairer treatment for
all employees like paying fair wages, offering jobs to challenged people and minori-
ties, ensuring that decent standards are maintained in workplaces. It could also be
extended in refusing to partner in business with unscrupulous businesses or oppres-
sive countries. In the Indian context, India did not have any business dealings with
South Africa during the apartheid regime. Now, very few states venture to have
business deals with North Korea.
An example in this context is some cosmetics companies that have decided to
do away with animal testing. Another typical example is the eradication of child
labor. Many companies insist that they receive materials from suppliers who do not
engage in child labor. Thus, the company ensures that they source the safest and most
suitable materials for their products.
Philanthropic CSR
It goes beyond merely operating as ethically as possible and involve actively bettering
society. It is usually associated with donations in the form of cash and kind for char-
itable initiatives. However, philanthropic CSR does not include only contributions
2 https://www.unilever.co.uk/about/innovation/latest-news/compressed-deodorant-cans.html.
Fig. 2 Carroll’s four-part model of CSR
to charity. The activities include investing in the local community in the form of
initiating and participating in local projects. By this activity, the business receives
loyalty from employees and also benefit from an improved support system.
Company-sponsored philanthropy also showcases the company’s commitment
toward society. It clearly shows that the company is not merely providing livelihood
to the local community but tries to give some service to the local community. A
company may encourage and honor its employees’ desire to do something for society.
The company may allow employees to undertake volunteer services during office
hours. It can also encourage employees to donate for a charitable cause and also
match it with an equal contribution.
The best example for this is one of the largest technology companies, Google,
which is famous for its corporate philanthropy. It runs many charity programs through
Google.org that have provided over $100 million in grants and investments. The
company has a robust volunteer program. It allows its employees to get engaged
in voluntary service even during working hours with full benefits. The company
has set aside 20 hrs per year for this noble service.3 Google also has a matching gift
program where donations contributed by employees that are between $50 and $6,000
are matched with equal company contribution.4
To the three aforelisted parts, one more part was added, and this model is now
the most accepted model of CSR called the “Four-Part Model of Corporate Social
Responsibility.” It was initially proposed by Archie Carroll and later refined by
Carroll and Buchholtz (Fig. 2) (Carroll, A. B., 1991). This model is as follows:
The model shows a multi-layer pyramid consisting of four inter-related aspects
of responsibilities, namely, economic, legal, ethical, and philanthropic. According to
Carroll, “Corporate social responsibility encompasses the economic, legal, ethical,
3 https://www.google.org/.
4 https://forms.matchinggifts.com/GoogleGuidelines.pdf.
and philanthropic expectations placed on organizations by society at a given point

in time.”5
Let us understand it in depth:
(a) Economic Responsibility. At the basic level, it is economic responsibility since
business is established with the primary motive of making a profit. It involves
duties in terms of reasonable return to investors, fair price to customers, and
fair compensation to employees and suppliers. Other responsibilities are based
on this.
(b) Legal Responsibility. Any business has to compulsorily abide by the rules and
regulations of the land and government authorities. There have been several
instances where large companies had to close down because of violations of
law. A few notorious examples are multinationals like Enron, Union Carbide,
and Indian firms like Global Trust Bank, etc.
(c) Ethical Responsibility. Beyond observing the law of the land, there is one
more dimension that is ethics. Business ethics has been a controversial issue,
but the conduct of business has to abide by some morality, which is beyond
the law. Thus, ethical responsibilities imbibe of societal expectation for the
general good beyond economic and legal expectations.
(d) Philanthropic Responsibility. The word Philanthropy is a Greek word that
means “love of the fellow human beings.” The term is used in business in the
context of activities that are (within corporate discretion) for the furtherance
of the quality of life of all stakeholders and society at large.6
The usual instances of such activities are donating for charitable causes, building
recreational facilities for employees and their families, support for educational insti-
tutions and initiatives, supporting art and cultural activities, etc. Not to be ignored
is the fact that philanthropic activities are not expected by society but the desires of
companies (Muller, A., & Whiteman, G., 2009).
The dimensions of CSR include the obligations a company has to its stakeholders.
CSR is an excellent way of demonstrating the humane side of the business. We
live in a global village today. We are increasingly getting connected. CSR provides
effective ways of managing these connections for the benefit of the company and
all stakeholders (Groza, M. D. et al., 2011). At the heart of CSR is sustainable
development at large (Fontaine, M., 2013). It is thus imperative that the inclusion of
CSR in company strategies goes beyond the good for the business. It helps the entire
society and the planet (Aguinis, H., & Glavas, A., 2012; Jaques, E., 2002).
5 https://www.accountingmags.com.ng/accounting-auditing/corporate-social-responsibility-its-
forms-and-dimensions/.
CSR Benefits
There are multiple benefits of CSR for companies as well as all the stakeholders,
which are enumerated below (Farrington, T. et al., 2017):
• Better Brand Image. CSR activities increase a brand’s recognition and create a
better image among all the stakeholders and the public at large (Johnson, Z. S.
et al., 2019). It encourages consumers to purchase the company’s products and
services and recommend them to others (Berens, G. et al., 2005). Companies that
appreciate and respect consumers’ choices are preferred, thus increasing customer
loyalty (Mohr, L. A. et al., 2001). Customers like to be appreciated and support
businesses that project an ethical image (Kemper, J. et al., 2013).
• Identifying scopes for building efficiency. CSR initiatives often lead to busi-
nesses assessing, reflecting, and evaluating their current processes, often leading
to the discovery of improvised ways for the business to improve its efficacy. For
instance, in 2010, PepsiCo found energy-saving opportunities worth $60 m as part
of an energy assessment program conducted by it.6
• Increased employee engagement and satisfaction. It is quite natural that
employees want to work for a company involved in altruistic initiatives and
has a reputed public image. CSR schemes create a sense of belonging and
bonding among employees by engaging them and encouraging positive relation-
ships amongst them. When stakeholders, viz. employees, customers, and even
suppliers have a vital input in areas of impact, CSR becomes a mighty influence
(Valentine, S. et al., 2011).
• Attracts talent and investors. Extending on the previous point, companies that
demonstrate a dedication to improving communities through CSR programs are
more likely to attract better talent (Bhattacharya, C. B. et al., 2008). Likewise,
investors want to put money in companies that exhibit good public perception and
have a sense of CSR. Businesses with noble initiatives demonstrate to investors
that profit isn’t their only priority, and giving back to society is also on the top of
their cards (Eisingerich, A. B., & Bhardwaj, G., 2011).
Benefits of CSR for Charities
• More volunteers. Some companies operate CSR volunteering schemes and

provide a steady flow of volunteers for charities. It helps in ensuring that a certain
number of volunteer hours can be met each year.
• More funding and exposure. It might sound obvious, but by companies publi-
cizing their support for a charity, awareness of the cause spreads too. The cause gets
to piggyback on the company’s marketing collaterals, in turn, encouraging more
funding (Korschun, D. et al., 2014). CSR initiatives like matching gift programs
also mean that charities can receive up to double the amount than they would
6 https://www.thegivingmachine.co.uk/corporate-social-responsibility-simple-guide/.
receive otherwise, thereby increasing their budget massively (McDonald, G. et al.,

2010).
• Stable partnerships. Partnerships formed through CSR between companies and
charities can often lead to long-term collaborations. Whether through ongoing
community projects or programs created from the ground up, businesses can
provide the means and resources for charities that would otherwise not have the
financial mobility for such campaigns. This work creates stability for charities
while also bringing more attention to the cause (Ellen, P. S. et al., 2006).
Law of CSR in India
Despite this lofty idea, CSR faced criticism from some quarters questioning the
ultimate benefit to society (Shamir, R., 2011; Henderson, D., 2005; Rosenberg, M.
J., 2002). The GOI has been trying to impress upon businesses the benefits of CSR
for all, but many companies were shying away. So, the government brought in a law
in 2013, which made it mandatory for companies to spend at least 2% of net profits
on CSR.7 The law faced intense criticism, and it was later made voluntary.
Organ Donation
Organ donation is a relatively recent phenomenon. It is the donation of organs or

biological tissue of the human body to a living patient from a person living or dead.
It needs the consent of the living person or approval of the next of kin in the case of a
deceased person. In India, this is regulated by the Transplantation of Human Organs
and Tissues Act, 1994. This act was brought in to curb rampant organ trading and
promote deceased organ donation. However, unscrupulous elements in the society
continued with activities exploiting loopholes in the law. There was a grave scandal
of multi-billion rupees involving the trade of human kidneys that rocked the nation
in 2008.8 In 2011, the law was amended to take care of this.9 The related activities
are governed by the National Organ and Tissue Transplant Organisation (NOTTO).
This body oversees all the activities of procurement, allotment, and distribution of
organs. The government of India started the National Organ Transplant Programme
with an allocation of |149.5 crores for promoting deceased organ donation.
7 https://economictimes.indiatimes.com/news/company/corporate-trends/companies-to-face-
penal-action-for-not-meeting-csr-rules/articleshow/70471926.cms?from=mdr.
8 https://www.tni.org/es/node/3890.
9 https://www.organindia.org/wp-content/uploads/2014/10/4.THOA-amended-ACT-2011.pdf.
Fig. 3 India is the 2nd largest organ transplanting country in the world
In 2019, India performed the second largest number of transplants in the world
only after the USA.10 It is primarily because of the enormous population (Fig. 3).
However, in terms of organ donation ratio, it is far behind many other countries
with a minuscule fraction of only 0.65 per million population (pmp) compared to
Spain (35.1 pmp), the USA (21.9 pmp), and the UK (15.5 pmp). Unfortunately, the
figure for India is so low because of ignorance, religious and superstitious beliefs.
Initially, Tamil Nadu and Andhra Pradesh were the most active states in organ
donation. In 2000, Indian Network for Organ Sharing (INOS) was established. In the
following decade, the two Indian states could retrieve 1,033 organs and tissues. In
2018, Tamil Nadu achieved a rate of 1.8 pmp, far higher than the national average.
In 1994, the Transplantation of Human Organs and Tissues Act came into effect.
According to this act, organ donors may be both living and deceased persons. Living
donors must be adults (over 18 years) and usually allowed to donate only to their
blood relatives. It is to curb the illegal organ trade where people sell their organs
willingly or under duress due to poverty. In exceptional cases, a donation is allowed
to recipients who have a close emotional attachment with the donors.
Only certain specific organs may be donated. Living donors may donate any of
one of the kidneys, part of the pancreas, and part of the liver.
Deceased donors can donate more organs other than the ones mentioned above
after permission from immediate family members. The organ could be one or more
from the heart, lungs, intestine, and uterus (not considered as a life-saving organ).
The diagram below depicts the areas active in deceased organ donation (Fig. 4).
10 https://www.notto.gov.in/WriteReadData/Portal/News/670_1_02.12.2019_Indus_Dictum_
India_performs_2nd_highest_number_of_organ_transplants_globally__next_only_to_US__Hea
lth_Minister.pdf.
Fig. 4 Resource: MOHAN foundation
In many countries, including India, brainstem death is also recognized as a form

of death. After brainstem death, as many as 37 different organs and tissues may
be donated, whereas, after natural cardiac death, eye cornea, bone, skin, and blood
vessels may be donated.
An organ transplant is a highly sophisticated process. Fortunately, many doctors
and surgeons in India are experts in it. A critical factor of success in any organ
transplant is the time lag between organ harvest and transplant operation. So, an
organ from a deceased person has to be quickly brought to the operation theatre
of a hospital. It is challenging in India because of the general slow movement of
traffic in urban areas where most of the hospitals are located. There is a concept
of green corridors for this purpose, which means a fast route that is available for
an ambulance vehicle carrying the harvested organs. The term green corridor came
into being in July 2014 when in Chennai, a hospital and traffic authorities, with the
help of the general public, made an extraordinary effort to transport a heart from
the deceased donor in one hospital to the potential recipient in another hospital. It
was done within half the usual time. Thus, the green corridor involves a concerted
approach and perfect coordination amongst the hospitals, urban traffic authorities,
and police and, in a few cases, airport authorities as well. It has been successfully used
in metropolitan areas in India like NCR, Mumbai, Bangalore, Kolkata, Hyderabad,
and even in a Tier-I city like Indore. Green corridors are particularly important for
transportation of heart and liver, where the preservation time is short vide 4–6 hrs
for a heart and 12–15 hrs for a liver. Green corridor transportation is mostly by road,
but air ambulances are nowadays used between cities. The government is trying to
popularise the mode of the air ambulance (Koushal, V. et al., 2018).
All the administrative regions in India are not equally active in this field (only
13 out of all the 36 states and UTs). It is an indication of prevailing social norms
and the influence of superstitions in those non-participating geographical areas. The
states in South India are much forward in this direction. The potential for deceased
organ donations due to brain death is high in India. About 80,000 persons die due to
road accidents every year. Almost half of this is due to brain death. Even if India’s
organ donation rate increases by 1 pmp, it would bridge the gap between demand
and supply. The deceased donation rate improved well during 2012–2017, but since
2018, it has slowed down.
Organ Donation as CSR Activity
In Karnataka, the government body that oversees the organ donation activities is the
Zonal Coordination Committee of Karnataka. During 2007–2012, there were only 58
organ donations from deceased persons, whereas the number of waitlisted patients
for transplant was very high. The situation has been slowly and steadily improving. In
2018 alone, Karnataka achieved 90 organ donations. Significantly, the overwhelming
majority of these came from private hospitals.
In the domain of organ donations, besides organizations that are part of central
and state governments, many NGOs have also joined. One of the leading NGOs in
this field is MOHAN Foundation in Chennai.
A pressing and specific question here is why organ donation is so vital for India?
Now, organ recipients may be classified as follows:
(a) People with inborn problems,
(b) Survivors of decease,
(c) Survivors of accidents.
An overwhelming number is from the last category, and of it, the survivors of
road accidents make up the vast majority numbers. Indian roads are notorious for
road accidents. The reasons are many bad roads, traffic congestion, pedestrians and
stray animals on the streets, lack of separate lanes for slow-moving vehicles like
bicycles, and, of course, an abysmal sense of traffic discipline among the general
public. Any road in urban areas is teeming with all kinds of motorized vehicles and
non-motorized vehicles like bicycles, hand-pulled carts, and animal-driven vehicles.
Added to that is a lax attitude of traffic police and low strictness in the enforcement of
Fig. 5 Road accidents, number of persons killed and injured (2014–2018)11
Fig. 6 Trends in the type of road accidents (2014–2018)14
traffic laws. So, the result is not surprising in terms of the number of road accidents
(Figs. 5, 6 and 7).
These statistics reveal two crucial points. A large number of injured persons
plausibly need organ transplants. A large number of deceased persons are potential
donors for them, and 40% of those people are left ‘brain dead.’ Even if 5–10% of
all these deceased patients donate their organs, then a living person will not have to
donate organs. There is a vast gap between scanty supply and massive demand for
organs, which has driven underground organ trade. About 2000 Indians sell one of
their kidneys every year.12
11 https://morth.nic.in/sites/default/files/Road_Accidednts.pdf.
12 https://www.who.int/bulletin/volumes/85/12/06-039370/en/.
Fig. 7 Number of accidents, number of persons killed, and those injured by the 33 category of
roads14
Literature Review
There is no research report or case study on the topic of Organ Donation as a CSR
activity. There are only a few media reports (see www.indiacsr.com, which reports
such activities). However, there is no detailed analysis.
A Gujarat-based organization Govindbhai C. Patel Foundation, runs a cooperative
housing society named Ganesh Housing Corporation Ltd. This housing society is very
active in this field. It promotes organ donation among its members and stakeholders
and organizes such camps.
The Chairman of this organization, Mr. Deepak Patel, urges the members to come
forward. He made an earnest appeal to members of the society. In his words, “I
realized that people need dramatic examples to shake them out of apathy, so in the
year 2009, I founded SHATAYU–an organ donation awareness initiative, whose sole
intent was to spread awareness about this lifesaving miracle. Shatayu is a nonprofit
organization–a public service initiative by Govindbhai C. Patel Foundation, which
is supported by Ganesh Housing Corporation Limited. It is derived from the age-old
blessing from Indian scriptures, Shatayu Bhava, which means ‘live until you are 100
and was evolved with the two-fold objectives of increasing awareness about organ
donation in India and broadening the mindset of people towards the gift of life. Today,
with great pride, I gift you this book and hope in my heart that you would decide to
give the most amazing gift anybody can give–The Gift of Life.”13
Now, we delve into the case involving an erstwhile Indian IT firm Mindtree which
had its headquarters in Bengaluru, Karnataka, and an NGO, MOHAN Foundation.
13 http://www.ganeshhousing.com/.
The Case Study of Mindtree and MOHAN Foundation
Mindtree Limited is an Indian multinational IT and outsourcing company head-

quartered in Bangalore and New Jersey, USA. It provided solutions in e-
commerce, mobile applications, cloud computing, digital transformation, data
analytics, testing, enterprise application integration, and enterprise resource plan-
ning. The company boasts of more than 307 active clients and 43 offices in over 18
countries, as on 31 March 2019. It was conceptualized and commenced by a group
of senior employees of Wipro. It was established in the 1990s and soon grew to be a
strong player. It was headed by Mr. Subroto Bagchi, who, besides his corporate work,
took a keen interest in philanthropic activities. This case study refers to the company
in 2017. Subsequently, it was acquired by Larsen & Toubro group. At present, the
company employs approximately 22 thousand employees with annual revenue of
about US$1.1 billion.
Mr. Subroto Bagchi first thought of making the company strong in CSR activities
by encouraging all employees. He struck upon the novel idea of promoting organ
donation as a CSR activity. For this purpose, he appointed a person Mr. Sethupathy
Ramkumar specifically for this activity. The company collaborated with the MOHAN
Foundation of Chennai.
The plan was executed like this. One day of the year was earmarked for CSR
activities. All the employees were advised to pick up at least one, if not two, activities
for CSR. A wide range of activities was offered. There were activities like visiting
and helping orphanages, homes for the elderly, homes for differently abled children,
etc. and also the donation of money and materials. The surprise element was that
organ donation was a given option. Mr. Sethupathy had already prepared posters on
the topic to create awareness. A meeting was organized for interested employees
to learn more about it, and Mr. Sethukumar clarified all the doubts and impressed
the audience with the need and nobility of the activity. More than 100 people came
forward to pledge their organs.
Conclusion
Organ donation as a CSR activity was a pioneering step by Mindtree then.

This thoughtful and kind act created awareness among its employees and other
stakeholders.
Recommendation
This CSR activity at Mindtree also inspired other organizations to think in the same
line. Two years ago, Mindtree was acquired by L&T, and it would be exemplary and
carrying forward a bequest if they continue this noble activity in the entire group.
India needs a large number of voluntary organ donors, and we can hope that soon
enough, the gap between demand and supply for human organs will be bridged.
Acknowledgements We are grateful to the co-founder Mr. Subroto Bagchi and his erstwhile team
at Mindtree, and people associated with MOHAN Foundation for sparing us their time and energy
for doing this study. Had it been not for them, this novel topic would not have seen the light of the
day through this chapter.
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CSR, Sustainability, Ethics & Governance

Series Editors: Samuel O. Idowu · René Schmidpeter

Ananda Das Gupta Editor

More information about this series at https://link.springer.com/bookseries/11565

ISSN 2196-7075 ISSN 2196-7083 (electronic)

© Springer Nature Singapore Pte Ltd. 2022

Human Values in Corporate Social Responsibility: A Case Study

Corporate Influence and the Role of Corporate Social

About the Editor

Santosh Basavaraj School of Business and Management, CHRIST (Deemed To

Aruna Das Gupta

A. Das Gupta (B)

© Springer Nature Singapore Pte Ltd. 2022 1

aspirant. Vedanta offers a perspective that nurtures values conducive to business.

provided an account of various activities of corporate social responsibility on India

And in rehabilitation, land for land, self-employment such as dairy, poultry,

expeditiously. Our founder’s humanitarian objectives of over a century ago need to

Santosh Basavaraj and Sreelakshmi. P

CSR is an evolutionary concept and different schools of thought perceived it in

S. Basavaraj (B) · Sreelakshmi. P

© Springer Nature Singapore Pte Ltd. 2022 11

Current Scenario of CSR in India

History of CSR in India

Before we glance at the CSR practices of TKML, India, it is essential to understand

Idea About Stakeholder View

In order to capture the holistic understanding of the cybernetics model, it is necessary

Idea About Sustainability Development (SD): CSR versus SD

Invesgate the Discover a proper tool to Reinforce that Toyota

Fig. 1 Contribution of this case study research to the body of literature

Toyota, India Performance in CSR

About Cybernetic Model

Prior to understanding of company CSR model, it is critical to discuss and compare

Applying Viable System Model Toyota Kirloskar Motors

Fig. 2 Comparison of Beer’s model with Roome model of cybernetics

Fig. 3 Theoretical model proposed by Nigel Roome (2004)

Outcome of This Hypothesis

1. Company constantly seeks competitiveness through environmental sustainability

Fig. 4 The questionnaire to measure sustainability development

Fig. 5 Conversion of theoretical model into practical model

Fig. 6 Representation of weighted data on Roome (2004) model

Fig. 7 The spread of data on Roome model

Limitation and Scope for Future Research

Ackoff, R. (1999). Ackoff ’s best: His classic writings on management. Wiley.

Shulagna Sarkar, J. Kiranmai, and R. K. Mishra

© Springer Nature Singapore Pte Ltd. 2022 39

The new governance concept perceives government to engage in a horizontal inter-

Risk for Business

There are several probable negative after-effects to businesses including environ-

Social Issues Across Countries

Table 1 Journey of CSR in India

•Revised Voluntary Guidelines on CSR, DPE

•National Guidelines on Environmental, Social and Economic Responsibility, MCA

•SEBI Mandatory on Business Responsibly Report

•Companies Act 2013 – Section 135

•Notifications CSR and SD - Section 135

2016 • Allocation of funds to CSR for Swachh Bharat

2021 •New CSR Amedment Rules, Jan, 2021