Corporate Social Responsibility (CSR)

Corporate social responsibility involves

responsibilities outside of making a profit and the
key questions for corporations include:
Does business have a social responsibility?
If so, what is the extent and type of the
responsibility?
Preliminary definitions of CSR
The impact of a company’s actions on society ,
Requires a manager to consider his acts in terms of
a whole social system, and holds him responsible
for the effects of his acts anywhere in that system.
Corporate Social Responsibility (CSR) / Corporate
Citizenship Concepts

Corporate social responsibility –

emphasizes obligation and accountability
to society
Corporate social responsiveness –
emphasizes action, activity
Corporate social performance –
emphasizes outcomes, results
 Responsible business conduct, responsible entrepreneurship,
corporate citizenship, corporate accountability or corporate
sustainability.

 CSR is the continuing commitment by businesses to behave

ethically & contribute to economic development while
improving the quality of life of the workforce & their
families ,local communities and the society at large. (World
Business Council)

 CSR requires companies to acknowledge that they should be

publicly accountable not only for their financial performance
but also for their social and environmental record.

 CSR encompasses the extent to which companies should

promote human rights , democracy, community improvement
and sustainable development objectives throughout the world.
(Confederation of British Industry,2001).
 CSR encompasses the extent to which companies should promote human
rights , democracy, community improvement and sustainable development
objectives throughout the world. (Confederation of British Industry,2001).

 CSR is the commitment of businesses to contribute to sustainable economic

development working with employees, their families, the local community
and society at large to improve their quality of life in ways that are both for
business and good for international development. World Bank,24 March
2004).

 CSR is an extended model of corporate governance based on the fiduciary

duties owed to all the firm’s shareholders. CSR is about how companies
manage the business

processes
to produce an overall positive impact on the society.

 CSR is the responsibility of corporations to go above and beyond what the

law requires them to do.CSR is the responsibility of corporations to
contribute to a better society and cleaner environment.
 Historical Perspective
Economic model – the invisible hand of
the marketplace protected societal interest
Legal model – laws protected societal
interests
Evolving CSR
 From the 1950’s to the present the concept of CSR has gained considerable
acceptance and the meaning has been broadened to include additional
components.

 It considers CSR considers the impact of the company’s actions on society

(Bauer)

 CSR requires decision makers to take actions that protect and improve the
welfare of society as a whole along with their own interests (Davis and
Blomstrom)

 It mandates that the corporation has not only economic and legal obligations,
but also certain responsibilities to society that extend beyond these obligations
(McGuire)

 Therefore , Modified the economic model

 Philanthropy
 Community obligations
 Against
 Restricts the free market
goal of profit maximization
 Business is not equipped to
handle social activities
 Dilutes the primary aim of
business .
 Limits the ability to
compete in a global
marketplace.
CSR : HAMPERING OR BENEFICIAL
For
 Addresses social issues business
caused and allows business to
be part of the solution .
 Protects business self-interest.
 Limits future government
intervention .
 Addresses issues by using
business resources and expertise
 Addresses issues by being
proactive .
Corporate Social Responsibility (CSR)
Business Responsibilities in the 21 st Century

Demonstrate a commitment to society’s values

and contribute to society’s social, environmental,
and economic goals through action.
Insulate society from the negative impacts of
company operations, products and services.
Share benefits of company activities with key
stakeholders as well as with shareholders.
Demonstrate that the company can make more
money by doing the right thing.
 India is the first country in the world to make corporate social responsibility
(CSR) mandatory, following an amendment to the Companies Act, 2013 in
April 2014. Businesses can invest their mandated share of profit in areas
such as education, poverty, gender equality, and hunger as part of any CSR
compliance.

Although the prescribed CSR for 2018-2019 was 19.86 Crores,

the company went on to spend 25.68 crores this year. Improving
Tata the quality of life and fostering sustainable and integrated
Chemicals development in the communities where it operates is central to
Tata Chemicals’ corporate philosophy. Tata Chemicals spends
Ltd. – INR 12 crores on CSR annually, and wildlife conservation
accounts for 30 percent of the budget of the TCSRD.

In FY 2018-19, ITC Limited spent INR 306.95 Crores. The

Company partnered with BAIF Development Research
Foundation, Pratham Education Foundation, Ramakrishna
ITC Ltd. – Mission, Bandhan Konnagar, SEWA Bharat, Foundation for
Ecological Security, ITC Sangeet Research Academy (ITC SRA),
ITC Rural Development Trust, and CII–ITC Centre of Excellence
for Sustainable Development to implement CSR programmes.