CSR in new dimensions: It has become imperative for cos to understand the social milieu in which they function

The recent speech of the Prime Minister at the CII meeting, leading to a debate on reservations in the private sector, has perhaps raised relevant issues on the whole concept of corporate social responsibility (CSR). Indian business has had a tradition of providing financial support for activities that go beyond the narrow interest of the shareholders. In the past, however, corporate philanthropy and actions defining creation of places of religious worship or schools and other institutions. This concept has undergone substantial transformation not only because the corporate sector is now involved in activities, which were earlier part of the Government's responsibility, but also because with the spread of information, public opinion has become an important part of the image of a corporate organization, outgrowing performance purely in a business sense. There is also a much larger reason for redefining CSR, grounded in the reality that business cannot succeed in a society which fails. It had, therefore, become imperative for companies to understand the social milieu in which they function. Public acceptance of the operations of any business, particularly in an alien society, often determines the success or otherwise of corporations. Such acceptance comes from the company in question being seen in empathy with the aspirations and values of the society in which it functions. Indian business, presents a very mixed record of CSR. Over the past five years TERI has been organizing a system by which awards are given away to corporate organizations for excellence in CSR. Companies submit detailed entries highlighting their CSR actions on the basis of which they are evaluated by a jury of eminent persons chaired by a former Chief Justice of the Supreme Court. Those shortlisted on the basis of careful screening of each entry are then subjected to due diligence verifying the accuracy of the entries submitted. The high level jury then makes a selection of winners in different categories of corporate organizations defined by size. The quality and caliber of actions taken in most cases is extremely heartening, because not only are companies thinking out of the box for benefiting communities and sections of society which are underprivileged such as those physically challenged, but the solutions provided often bear the stamp of innovation and originality worthy of emulation on a large scale. Indeed, there is also often a correspondence between the financial health of a company and its quality of CSR programmes. Society at large, and politicians in our democracy, are likely to become increasingly demanding of companies towards genuine commitment to CSR, and to that extent the Prime Minister?s recent speech has at least led to a serious debate on corporate activities and the welfare of the society, that will provide a flow of ideas and intellectual innovation benefiting Indian society as we move along in the 21st century.