Corporate Social

Responsibility
Meaning of Social Responsibility
• Business Depends on Society for the needs of Inputs like
• Money, Men & Skills
• Where they can sell their products
• Society become Support agent and encouragement for busines
• According to Howard R Bowen
• “Social responsibility of business refers to the obligation of business to pursue
those policies to make those decisions or to follow those lines of actions
which are desirable in terms of the objectives and values of the society.”
Some Definitions of CSR
• European Commission definition in 2004:
“CSR is a concept whereby companies integrate social and environmental
concerns in their business operations and in their interactions with their
stakeholders on a voluntary basis”

• McKinsey:
“Large companies need to build social issues into strategy. They need to
articulate business’s social contribution and define its ultimate purpose in a way
that has more subtlety than “the business of business is business” worldview.”
Some Definitions…
• Philip Kotler:
• “CSR is the commitment to improve community well- being through
discretionary business practices and contributions of corporate resources”

• World Business Council for Sustainable Development:

• “Corporate Social Responsibility is the continuing commitment by business to
behave ethically and contribute to economic development while improving
the quality of life of the workforce and their families as well as of the local
community and society at large.”
Meaning and definition of CSR
• Michael Porter’s Views..
• “If looked strategically, CSR can be more than a cost, constraint or a charitable
deed and can be a source of opportunity, innovation and competitive
advantage.”

• According to the Corporate CANNON (1994)

• “Corporate Social Responsibility means devising corporate strategies and
building a business with the society’s needs in mind.”
CSR Includes
• Constituency Relation:
• It relates Businesses with Local Government, Employees, Customers, Suppliers,
Shareholders…
• Compensating Social Cost:
• Companies relates to the society through more than just mark-place transactions
• Social Contract Theory:
• It states that Business has moral and ethical duty to contribute to the social well-
being. Business and society have entered into a social contract where each party
has rights as well as duties towards each other.
• Moral Obligation:
• All Business is not only obliged to do harm, it is required to do good. Being
profitable is a virtue in business but it is not the only virtue, Business should be
socially be responsible that is part or moral obligation.
Nature of CSR
• Wealth Creator for the society
• Business is primary source of wealth creator for the society, therefore it
should operate in a responsible and sustainable manner.
• Integration with regular business activities
• CSR is a positive Business driven response to the business environment today,
therefore, it should not be add-on to business activities but it should be
integrated to the business
• CSR is Multidimensional Concept
• It covers Social, economic and environmental concerns
• CSR should be alternative to regulations
Scope of CSR
• CSR brings integrity in all corporate activities
• Providing customer centric products
• Fair trading
• Managing corporate secrets
• Doing business with public bodies and making political contributions
• Protection and use of intellectual property
Scope
of CSR
Importance and Significance of CSR
• CSR Contribute in
• Increased productivity and quality
• Reduce operating Cost
• Increase Sales & Customer Loyalty
• Improve Financial Performance
• Improved Transparency & Reporting
• Reduce Regulatory oversights
Areas of CSR to be Focused
• Ecology & Environmental Quality
• To maintain pollution fee environment
• To ensure dispersion of industrial waste
• To ensure beatification of surrounding land
• Consumption
• To provide true and fair business dealing
• To adhere with the values of commitments
• To ensure control of harmful products
• Community Need
• Government relation
• Responsibilities deprived sections of society
• Corporate Philanthropy
• To provide financial and moral support to Art & Culture
• To arrange societal scholarships
Different Ethical Views of CSR
• Communist View
• Capitalistic View
• Pragmatic View
Arguments related to CSR
For CSR
• CSR has changed the Public
Expectations of Business
• CSR helps to provide Better
Environment for Business
• CSR improves Public Image
• CSR helps avoidance of Govt.
Regulations
• CSR is a Moral Responsibilities
• CSR is prevention which is better
than cure
Against CSR
• CSR is only done for indirect
profit maximization activity of
business
• Society has to pay the cost
• By these they try to gain Powers
• Lack of Accountability
• Lack of broad Support
Nestle example
A Territory Not Meant for Business
• In 1962, company wanted to
enter India.
• Received government
permission to build a dairy in
Punjab’s district of Moga.
• Poverty in the region was severe.
• Infrastructure: No telephones,
no electricity, no transportation,
no medical care.
• A farmer owned less than 5 Acres of
poorly irrigated land with infertile soil.
• Many kept one cow / buffalo for own
consumption of milk.
• 60% of calves died newborn.
• No methods to test for quality of milk,
frequent contamination as there was
lack of cold storage.
The Transformation
• Nestle built refrigerated dairies
in each town and sent trucks to
collect the milk.
• With trucks went vets,
nutritionists, agronomists &
quality assurance experts.
• Medical units were provided for
sick animals.
• Farmers were given monthly
training sessions.
• It enabled them to learn that
milk quality depended on cow’s
diet which in turn depended on
feed crop irrigation.
• It provided technical & financial
assistance to dig bore-wells.
• Irrigation improved, crop yields
improved and standard of living
improved.
Mahindra and Mahindra
Nanhi Kali
• The Mahindra group started the project Nanhi Kali in 1996 with an
objective of providing primary education to the underprivileged girl
child in India .

• In 2005 , K.C.Mahindra education trust entered into a partnership

with Nandi foundation , a reputed NGO to manage programme for 10
years .

• Over the years the project Nanhi Kali has successfully evolved into a
major national girl child sponsorship programme , which not only
provides money but also material support in form of clothes ,
uniforms , notebooks etc.