Csr & competitiveness october 2013 by CSR & COMPETITVENESS

www.csrcompetitiveness.com Vol.1 I Issue -4 I October 2013

Dear Readers, The northwards skyrocketing sensex, the race of achieving corporate excellence, the quest of being listed in Forbes Fortune 500, quest to maximize ROI, quest to be the leader in product and service delivery and innovation, quest of being the leader in adopting latest technologies has been posing new set of challenges and opportunities to the corporate doyens of modern India to deliver excellence with a passion to achieve global competitiveness by leveraging CSR innovations in the digital era. The organizations across the globe are orienting the organizational structure, Standard Operating Procedures, Systems, People and Processes to align the CSR activities in concomitance and alignment with the organizational vision, mission and objectives.

Rusen Kumar Editor & Director

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The evolution of successful CSR Models to ensure engagement, excellence, and innovative approaches to imbibe, instill, inspire and sustain the passion and spirit of CSR among all stakeholders of the organization and the society shall play a key role in defining success of organizations.

IICA under the visionary leadership of Bhaskar Chatterjee, recently signed memoranda of understanding with country’s leading research, academic and business institutions including Institute of Public Enterprise (IPE); Tata Institute of Social Sciences (TISS); Tata Energy and Research Institute (TERI) and YES Bank Limited in the presence of Minister of Corporate Affairs, Sachin Pilot in the process of achieving excellence in areas of common interests by leveraging the competencies of the partner institutions. The Indian Business Schools are pioneering new vistas of excellence by innovative curriculum, forging strategic alliances, laying enhanced emphasis on corporate social responsibility, integrated research and various other allied areas. The students of Goa Institute of Management (GIM), Sanquelim, North Goa, undertook various projects under a corporate social responsibility (CSR) initiative known as ‘Give Goa’ as a part of the missionary zeal of GIM to evolve more and more socially

responsible managers. The recent inclusion of ‘Farming’ to CSR is a milestone achievement as the budding managers are working with the farmers to enhance the overall farm productivity. The corporate world is increasingly busy in planning, implementation and control of participatory development models in the areas of CSR so as to leverage the challenges and opportunities arising in the dynamic dimensions of business environment. The success of the organizations in the modern competitive business world will depend phenomenally on the CSR strategies and their successful implementation. The evolution of successful CSR Models to ensure engagement, excellence, and innovative approaches to imbibe, instill, inspire and sustain the passion and spirit of CSR among all stakeholders of the organization and the society shall play a key role in defining success of organizations. I urge the senior management of the leading corporates to create dynamic team of Learning and Development professionals who are committed the cause of excellence in the organization by taking up the mission of CSR on a turnkey basis to focus on developing CSR orientation, knowledge, skills and passion to apply the knowledge and skills for achieving excellence in CSR projects ultimately contributing to the vision, mission and objectives of the organization. The long term success of the modern day organization shall hinge upon the overall success of CSR programs which shall provide a catalytic boost to the brand image of the company and their products and services in the minds of the people in the society. Setting up Organisations and business models around CSR shall see new phases of evolution in emerging economies including India.

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Editorial and Advisory Board Rusen Kumar Editor Dr (Prof.) Rana Singh Executive Editor ranasingh@indiacsr.in Anil Jaggi Executive Editor anil@indiacsr.in Dr (Prof) Saurabh Mittal Sub-Editor, New Delhi saurabh@indiacsr.in Triambak Sharma Renowned Cartoonist Editor-Cartoon

Jatinder Singh Secretary- Innovation, CSR, Education & Skill Development Committee PHD Chamber of Commerce and Industry Vijay Kapur Eminent CSR Consultant & Author Director – Kohana CSR Enakshi Sengupta Eminent CSR Consultant & Author Director – Kohana CSR Prof BD Singh Renowned Academician & Author Dr K K Upadhyay Head CSR-Ficci Aditya Birla CSR Centre of Excellence Monaem Ben Lellahom Co-Founder & Head of Sustainability Advisory Services Sustainable Square Consultancy and Think Tank UAE

CSR & Competitiveness | October 2013

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CSR & Competitiveness does not accept responsibility for returning unsolicited manuscripts and photographs. All unsolicited material should be accompanied by self-addressed envelopes and sufficient postage. Reproduction in whole or in part without written permission of the publisher is prohibited. All right reserved. The views and opinions expressed by the authors do not necessarily reflect those of the publisher or the editorial staff. Please inform us if any copyright has been inadvertently infringed. CSR INDIA CORPORATE SOCIAL SERVICES PVT LTD and CSR & COMPETITIVENESS is not responsible and liable for any comments and articles published by its contributors and will not be liable for any damages. All disputes are subject to the exclusive jurisdiction of competent courts and forums in Raigarh, India. On behalf of CSR India Corporate Social Services Pvt.Ltd. published, edited and printed by Rusen Kumar. Printed at Neha Offset, Bazi Rao Para, Near Church, Raigarh-496001, Chhattisgarh INDIA and published at 222, Krishn Vatika, Church Road, Boirdadar, Raigarh-496001, Chhattisgarh INDIA.

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Evolving CSR Model to Enhance Global Competitiveness The process of evolving the CSR model should be more participatory in approach rather than making it a simple process either managed at the top or the middle level. The participative and evolutionary process of development of the CSR model has proved to be relatively more and more engaging, enriching and rewarding with the various internal and external stakeholders of the organization. By Dr. Rana Singh & Rusen Kumar The organizations are required to evolve the CSR Model in the exponentially dynamic corporate world to ensure maximum productivity by optimal utilization of resources. The success of the organization in the times to come shall depend to a great extent on the dynamically evolving business model including the CSR model of the organization. The organizations across the world and India in particular shall reorient the strategic planning process so as to be able to incorporate the changes that are to be made as an outcome of the exponential rate of change in the various dimensions of the business, legal, regulatory and economic environment including CSR. Evolving a CSR model is highly recommended for organizations having multi country operations as well as companies operating in a single country like India irrespective of the size or scale or domain area of the organization. Evolving a CSR model is normative and not prescriptive for the organizations. We must understand the perspective with which we are discussing and recommending the organizations to evolve their CSR model. The focus of this article is to ignite the spirit of evolving, developing and restructuring the CSR model of the organization which can provide a catalytic boost to the organizational growth and development apart from facilitating the organization in gaining and sustaining global competitiveness. The evolution of the CSR model should be a systematic process wherein the top management of the organization shall judiciously analyze the internal and external factors and variables apart from evaluating some of the business best practices in the area of CSR. The organizations may opt for one of the many routes in the process of development of their own CSR model. The low risk approach may recommend the evaluation of some of the successful CSR models in India and abroad and pick and choose the model which may seem to be relatively better than others after conducting an unbiased multi-dimensional analysis. The alternative option would be to travel on unchartered paths and evolve some new and radically different CSR model to outperform all the existing CSR models. The success of a CSR model depends on thorough analysis of factors, variables and dimensions in the internal environment and the external environment, focused and meticulous implementation of the model with the required check and balances in the form of control mechanism. The development of the CSR model requires adequate research on various factors and dimensions so as to reach a conclusive form. The empirical research of the various factors and dimensions would be highly recommended to understand the pros and cons of adopting a particular CSR model. The conceptualization of a CSR model has to be done with utmost care and focus as the careful analysis of various factors and dimensions in the process of developing the CSR model goes a long way in defining the success of the CSR model as well as ensuring success and competitiveness of the organization. The success story of the organization becomes concomitant to the success of its CSR model. It has to be understood from a holistic perspective. The successful planning, implementation and control of the CSR model along with the business model has a profound bearing on the image of the organization among the masses. The positive image in the minds of the people as an outcome of the successful CSR model leaves a strong impact of brand perception in the minds of the customers in the society. The enhanced brand image due to enhanced confidence of the customers of the society as an outCSR & Competitiveness | October 2013

The success of an organization is a function of successful evolution of a dynamic and innovative CSR model, a team of dynamic CSR professionals to execute the model and its planned initiatives, optimal allocation of financial resources, meticulous implementation of the innovative plans, and a robust control mechanism to ensure that the plans are accomplished meticulously with necessary checks and balances at various levels of the organizational hierarchy.

come of planning, implementation and control of a successful CSR model goes a long way in enhancing the sales, market share and ultimately enhancing the productivity of the organization and competitiveness of the products and services of the organization apart from maximizing the ROI. The process of evolving the CSR model should be more participatory in approach rather than making it a simple process either managed at the top or the middle level. The participative and evolutionary process of development of the CSR model has proved to be relatively more and more engaging, enriching and rewarding with the various internal and external stakeholders of the organization. The process of development of the CSR model must be akin to the development of vision, mission and objectives of the organization. The organization may conduct series of workshops to evolve the CSR model for the organization which can contribute to the accomplishment of organizational vision, mission and objectives. The process of the development of the CSR model must be highly interactive and responsive to new thoughts, views and ideas from stakeholders, analytical in approach and research focused with a passion to evolve a dynamic CSR model which can optimally integrate the thoughts, views and ideas of the majority stakeholders so that the stakeholders feel proud of the contributions they would make in the process of implementation of the CSR model. The risk of the CSR model must be analyzed from various angles and perspectives. The simplest approach would be to analyze the various possible scenarios in the process of implementation of the CSR model. The risk analysis of the CSR model gives us the required confidence in the process of evolution and development of the CSR model so as to make it revolutionary in approach. The risk analysis must be done continuously in the process of evolving the CSR model, implementing the CSR model as well as changing the CSR model. The process of risk analysis must focus on considering the multi-dimensional impact of the various factors, dimensions, and variables involved and impacting the process of the evolution and development in CSR modelling. The senior CSR professionals

must keep a keen eye on the overall risk dimensions of the CSR model and keep on analyzing the risk profile of the CSR model to track phenomenal changes which can adversely impact the overall envisioned success of the CSR model and its associated programmes and initiatives. The risk modelling of the CSR model has to take into consideration the various possible changes in the external and internal environment of the organization. The risk analysis, risk modelling of the CSR model helps in envisioning the various possible outcomes and their likely impact on the various dimensions of the organization including CSR in various possible business scenarios. This will ensure that the organization has options and alternative courses of action in times of economic turbulence or downturn without adversely impacting the CSR initiatives as well as the overall functioning of the organization. The organizations in the modern digital era must have technology enabled systems, process and procedures to analyzed the overall analysis of the productivity, efficiency and effectiveness of the CSR model and the allied initiatives. The technology enabled systems facilitate an ongoing and dynamic tracking of the planning, implementation and control mechanism of the CSR model so as to ensure that the required preventive and corrective mechanisms must be in place in case of any requirements in the lights of the ongoing changes in the external and internal environment. The successful evolution of the CSR model has manifold advantages. It helps the organization in following the right path in the CSR domain area by optimally integrating its requirements and resources to accomplish the vision and mission of the CSR domain with an ultimate intent to accomplish the vision, mission and objectives of the organization. The success of an organization is a function of successful evolution of a dynamic and innovative CSR model, a team of dynamic CSR professionals to execute the model and its planned initiatives, optimal allocation of financial resources, meticulous implementation of the innovative plans, and a robust control mechanism to ensure that the plans are accomplished meticulously with necessary checks and balances at various levels of the organizational hierarchy. The successful process of evolving and implementing the CSR model leads to enhanced brand image which optimally supplements and complements the overall brand communication strategies of the organization. This leads to a highly enhanced brand image among the customers and all stakeholders thereby leading to a cascading impact on the overall sales of various products and services ultimately contributing to the overall competitiveness of the organization in the domestic economy as well as the global markets.

Dr. Rana Singh is the Executive Editor and Rusen Kumar is the Editor, CSR & COMPETITIVENESS. Authors can be reached at rusenk@indiacsr.in/ ranasingh@indiacsr.in

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IICA Signs MoU with BSE to Collaborate on Developing India’s First CSR Index IICA through this MOU which amongst other things would also work with BSE Ltd to make a CSR Index. BSE, with more than 5200 listed companies, highest in the world shall enable IICA and BSE in this initiative to get more comprehensive perspective of CSR practices followed by Indian Corporate across various industries segment and shall enable to make India representative CSR Index. CSR & Competitiveness Indian Institution of Corporate Affairs (IICA) and BSE Ltd on September 23, 2013 signed an Memorandum of Understanding (MoU) in Mumbai to work collaboratively to develop a Corporate Social Responsibility (CSR) index, take up capacity building on CSR, conduct education and awareness programmes, and other activities to facilitate a more effective corporate participation in CSR areas. Sachin Pilot, Minister of State for Corporate Affairs, was present on this occasion. “Transparency is very important and so the companies must disclose their spending and areas of spend on their own websites and the MCA website as well. The IICA and BSE partnership will go a long way on raising the level of awareness and accountability”, Sachin Pilot said. Speaking of the development of CSR index as one of the deliverables of the MoU, Minister stressed that “Top corporate leadership must lead from the front. It is a new beginning, new initiative for companies with the wherewithal to undertake such initiatives. The index will help in giving a larger platform to such companies and also a global perspective.” R. Ramadorai, Chairman, BSE Ltd, while addressing the gathering spoke of earlier BSE interventions in developing such indices and also the importance of development of the CSR index, in the context of the new Companies Act. “BSE through this partnership with IICA shall work on CSR Index which will be driver for CSR practices for the Indian Corporate world and an ideal option for investors to put their money for ‘responsible investment’. Increasingly more investors are considering CSR as an important investment theme both globally as well as in domestic markets.” Mr. Ramdorai added. Dr. Bhaskar Chatterjee, DG & CEO, IICA termed the event as a historic occasion when the premier stock exchange of the country and a national institute has decided to collaborate. “This MOU will be a major landmark to get a better insight into the domain of CSR.

“Transparency is very important and so the companies must disclose their spending and areas of spend on their own websites and the MCA website as well. The IICA and BSE partnership will go a long way on raising the level of awareness and accountability.” Sachin Pilot Minister of State for Corporate Affairs

One of the initiatives under the MoU, the CSR index, is a noble idea and will be put into action after consultations with the leading experts in that field. The CSR index would seek to promote investor participation, consumer interest and socio economic benefits to the disadvantaged communities by generating awareness and accountability in CSR spending”, he elaborated. Indian Institution of Corporate Affairs (IICA) was established by Ministry of Corporate Affairs (MCA), Government of India to act as think-tank and centre of excellence to support the growth of the corporate sector in India through an integrated and multi-disciplinary approach. In the new Companies Act, 2013 it has been mandated for eligible companies to spend 2% of their profits on CSR activities. This initiative of the Ministry of Corporate Affairs which requires companies to look beyond shareholder value and make CSR a core driver of their strategy shall bring competitive advantage to Indian Inc with the global players in the long run and shall attract more investment from investors. Further to assist Indian companies to drive their business models based on this approach, IICA through this MOU which amongst other things would also work with BSE Ltd to make a CSR Index. BSE, with more than 5200 listed companies, highest in the world shall enable IICA and BSE in this initiative to get more compre-

hensive perspective of CSR practices followed by Indian Corporate across various industries segment and shall enable to make India representative CSR Index. The proposed IICA-BSE CSR Index shall assess impact and performance of companies listed at BSE in CSR activities. The Index would also look at the performance of companies in their mandatory CSR spend as per the new Companies Act, 2013 as one of the important and objective criteria. The information provided in the public domain on CSR activities by these listed companies and which is also assured, shall have more preference in the various evaluation parameters of the Index. Performance of the companies in CSR areas would be combined with the market performance of companies for selection of companies. The Index would be sector neutral. Companies eligible to be included in the Index for further evaluation shall ensure basic compliance as per proposed CSR regulations. IICA-BSE proposes to form an Advisory Committee which would guide for CSR index construction and its design. This Advisory Committee would have consultative approach and interact with various stakeholders so that best global practices are aligned to Indian needs as per Section 135, Companies Act 2013, in the index construction and it becomes benchmark index to assess Indian corporate in CSR. IICA-BSE shall also work on capacity building to assist companies for meeting their agenda of CSR and would conduct awareness programme in next 6 months. This CSR Index shall be viewed by all market participants to track the leaders in CSR activities in India. Top performers of this CSR Index shall be drivers for other corporate in India to perform and meet the expectations of all stakeholders in the society. As capital market gets more aligned to international norms long terms investors with very sizable amount of investible money such as pension funds, insurance companies and funds with mandate of ‘Responsible Investment’ would look at such index and its top performers to decide their investments. Globally it has been observed indices based on CSR or ESG themes have outperformed the benchmark indices.

BSE Ltd

IICA Indian Institution of Corporate Affairs (IICA) was registered as a Society on September 12, 2008 under the Societies Registration Act, 1860 to establish, manage, maintain and run the IICA. The IICA Society is headed by the Hon’ble Minister of Corporate Affairs, who is the Ex- officio President of the IICA Society. A Board of Governors with 17 Members has been constituted comprising government officials, eminent corporate leaders, professionals, heads of prestigious national institutions and experts from different fields. The Board of Governors is chaired, ex-officio, by the Secretary, Ministry of Corporate Affairs. The Prime Minister, Dr. Manmohan Singh on April 13, 2013 inaugurated the new campus of Indian Institute of Corporate Affairs Campus in Manesar, Haryana. CSR & Competitiveness | October 2013

Established in 1875, BSE Ltd (formerly known as Bombay Stock Exchange Ltd), is Asia’s first Stock Exchange and one of India’s leading exchange groups. Over the past 137 years, BSE has facilitated the growth of the Indian corporate sector by providing it an efficient capital-raising platform. Popularly known as BSE, the bourse was established as “The Native Share & Stock Brokers’ Association” in 1875. BSE is a corporatized and demutualised entity, with a broad shareholderbase which includes two leading global exchanges, Deutsche Bourse and Singapore Exchange as strategic partners. BSE provides an efficient and transparent market for trading in equity, debt instruments, derivatives, mutual funds. It also has a platform for trading in equities of small-and-medium enterprises (SME).

Awards

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Wockhardt Foundation Wins CSR Award at Asia CSR Leadership Awards

The Award was accepted by CEO, Dr. Huzaifa Khorakiwala who said - “This Award renews our commitment to bring large scale social impact and relieve the suffering of the poorest.”

MUMBAI : Wockhardt Foundation was awarded the “Best CSR in Healthcare” at the Asian CSR Leadership Awards held in Dubai on September 24, 2013. This Award is given to outstanding organizations who have played a meritorious role in Health care Development. Wockhardt Foundation has embarked on a path-breaking ambitious social growth programme of providing free, primary healthcare to the rural and remote parts of India through its “Mobile 1000” initiative. Today “Mobile 1000” has a Pan-India presence operating in 11 states of India. Beside “Mobile 1000”, its other Programmes like BioToilet, SHUDHU water purification tablets, The Word Peacekeeper Movements ,POSHAK malnutrition supplement, Khel Khel Mein, HIV/AIDS, have also started making significant impact. Wockhardt Foundation is governed by the 3 B’s - BIG, BEST, and BOLD. BIG is to implement programmes which have national scale, BEST is its programmes must measure upto the highest levels of quality implementation, and BOLD is to operate its social development programmes where the need and poverty is the most. It is a nation-wide team of more than 350 rapidly growing, strong, and sensitive Warriors who render full-time service to the Foundation that translates the motto of “where every smile counts” into reality.

Financial Inclusion & Payment Systems Award

The award was received by Samir Khare, General Manager - Business Solutions on behalf of Fullerton India and was handed over by J. Seelan, Minister of State for Finance, GOI and R Chandrashekhar, Ex Telecom Secretary and President Designate, NASSCOM.

MUMBAI : Fullerton India Credit Company Limited, has been conferred the Financial Inclusion and Payment System Award 2013’ held in Delhi on the October 25, 2013. The project that won the award was the biometric based ‘Smart Handheld device on Field’ device, which facilitates the loan installment collection process in the rural markets. This system has been a unique feature of Fullerton India’s rural business operations – offering both convenience and transparency in transactions to customers. Currently Fullerton India’s rural business which operates under the brand name –“Gramshakti” does over 1.5 Million transactions through these hand held biometric devices every month. Commenting on the exciting win, Ravi Shankar, Executive Vice President Marketing & Rural Business stated, “We, at Fullerton India, have a long term vision of improving financial inclusion and helping enhance livelihoods of people by providing them access to quality financial services. To enable this we have invested in unique technology systems to serve the customer better and faster. The use of biometric authentication processes and transaction devices have enabled speedier servicing of customers and also built a great level of transparency, trust and customer confidence in transactions with them. “

Social Responsibility I.C.C. Award to Deepak Nitrite Fullerton India Bags Awards for Rural Development & Sustainable Leadership

The award ceremony was held at a special function organized by Executive Committee of Indian Chemical Council at Mumbai on 26 September 2013. R.R. Prasad, Vice President of Human Resources Division of Deepak Nitrite Ltd., Puransinh Bist Deputy General Manager Projects and Liaison of Deepak Nitrite Ltd and Jai Pawar, Deputy Director of Deepak Foundation received the award from Dr. A.J.V.Prasad, Jt. Secretary, Dept. of Chemicals & Petrochemicals, Govt. Of India At this event Executive members of Indian Chemical Council including President Yogesh M.Khotari, Vice President –Rakesh Bharti, Additional Vice President –Ravi Kapoor were present. Nikhil R. Meswani, Executive Director of Reliance Industries Ltd. was the Chief Guest of the event ICC offers prestigious annual National Awards to industrial units for their achievements in various fields. The award was open for any industrial unit engaged in operation of Refinery; Petrochemicals; Fertilizers; CSR & Competitiveness | OCtober 2013

Inorganic & Organic chemicals; Speciality chemicals; Pharma / Biotech; Agrochemicals; Man-made Fibers; Soaps & Detergents; Paints & Pigments; Dyes & Dye Intermediates, both in Public and Private Sector. A panel of independent, recognized and respected judges from diverse industry sectors and disciplines evaluated the entries and decided on the winners. This year large number of nominations from the Indian chemical industry in the various categories had applied for ICC Award.

Deepak Nitrite Limited, the parent organization of Deepak Foundation was felicitated by the Indian Chemical Council (ICC) award for social responsibility for the year 2012 in category I (Companies having annual sales revenue above Rs. 500 crores).

MUMBAI : Fullerton India Credit Company Limited, a leading Non-Banking Finance Company in India, has been conferred the CSR Award for Rural Development and Sustainable Leadership at the Asian Leadership Awards, held in Dubai on September 24, 2013. The award was bestowed, recognising Fullerton India’s Rural Livelihood Advancement initiative and its large impact on rural households across India. The event attracts Asia’s leading business visionaries across all industry sectors, and honours their achievements in contributing towards the region’s economic development. Fullerton India has won a string of awards for its CSR initiatives across various platforms and has a rich history of rural development initiatives initiated across India. Adding another feather in its cap with this esteemed win, the company continues to reinforce its commitment towards social and economic development.

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Religious Contributions by Corporates not CSR Activity: Sachin Pilot NEW DELHI : Corporate Affairs Minister Sachin Pilot said religious contributions by corporates should not be considered as corporate social responsibility (CSR) activity. “Religious contributions by corporates should not be considered as CSR. For a corporate entity to do religious donations... I don’t think it constitute a part of CSR,” he told reporters on the sidelines of an interactive session with industry honchos organised by the Confederation of Indian Industry on October 4, 2013.

“Out of a total 800,000 companies in the country, around 15,000 companies will qualify for CSR activities.” Sachin Pilot Minister - Corporate Affairs

According to the new Companies Bill 2012, companies with a net worth of Rs.500 crore or more, a turnover of Rs.1,000 crore or more or a net profit of Rs.5 crore or more in a financial year are mandated to pay 2% of their profit towards CSR. This provision has led to considerable discussion in the corporate sector regarding its pros and cons. “Certainly, we will make some broad guidelines about what are the things which will be considered as CSR, but it is upto the companies to decide. The boards of the companies have to give approvals to these and it should be put up on the website of the companies for public view,” Pilot said. While interacting with the industry members earlier, he said out of a total 800,000 companies in the country, around 15,000 companies will qualify for CSR activities. “With CSR being made mandatory, we do not want corporates to spend money on it grudgingly. We want the companies to come forward to contribute in nation-building. It is not about the quantum of money, it is about being part of the social and economic development of the country,” he added. Pilot said the CSR activities of the companies should be approved by their respective boards. “This will be as open-ended as possible.” The industry leaders who attended the interactive session were Adi Godrej, chairman, Godrej Group; Kris Gopalakrishnan, executive vice-chairman, Infosys; Kiran Mazumdar Shaw, chairman and managing director, Biocon Limited; Rahul Bajaj of Bajaj Electricals; and Rajive Kaul, chairman, Nicco Corporation, among others. Regarding the ongoing Tata-Unitech issue, where the Serious Fraud Investigation Office has questioned the purpose of the Rs. 1,700 crore deal in 2007 between the Tata Group and Unitech, Pilot said the report will come out in the next few days. (Agency)

‘Companies to Have Freedom to Choose CSR Activities’

2 % on CSR is the Best Investment a Company Can Make

NEW DELHI : Corporates would have discretion to decide on what can be considered as CSR activities under the new Companies Act, Union Minister Sachin Pilot said on October 4, 2013 . Under the Companies Act, 2013, certain class of entities are required to shell out two per cent of their three-year average annual profit towards corporate social responsibility (CSR) activities.

more liberal than that,” he told a gathering of businessmen here in Delhi. Pilot, who was instrumental in pushing the new Companies Act as Corporate Affairs Minister, said that CSR norms would be framed in a transparent manner and kept as “open ended as possible”.

Describing CSR as a new idea being included in the legislation, Pilot said the Ministry is giving only suggestive items regarding such activities. The Schedule VII of the Companies Act provides a list of activities which may be considered as CSR. The schedule also mentions that “other matters as may be prescribed” could be CSR work.

His comments came at an event organised by industry body CII against the backdrop of some corporate leaders raising concerns about the idea of CSR in the new legislation. Noted industrialist Rahul Bajaj expressed some concerns about certain aspects of the Companies Act including those related to CSR and rotation of auditors. “To me CSR is the least important…,” Bajaj said.

Referring to this schedule, Pilot said that he was going to replace ‘as may be prescribed’ to “as the company deems fit”. “I can’t be

Certain class of profitable companies are required to spend two per cent on CSR activities as per the new legislation. This

CSR & Competitiveness | October 2013

would be applicable for corporates with turnover of Rs 1,000 crore and more, or net worth of Rs 500 crore and more, or a net profit of Rs 5 crore and more. Among the activities for CSR under Schedule VII are reducing child mortality and improving maternal health and contribution by companies to the Prime Minister’s National Relief Fund or any other fund set up by the central or state government for socio-economic development. “The success of this (CSR) would depend on how this is received by the Indian corporates. I am open to all suggestions,” the Minister said. Pilot also stressed that religious donations does not look like CSR. Going by estimates, the annual CSR spending by companies is expected to be around Rs 15,000-20,000 crore. The Ministry is in the process of making rules for implementation of the new Act. (Agency)

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Compulsory CSR Spending to Create 50,000 Job Opportunity Around 8,000 companies will fall under the Companies Act’s ambit and this in turn will open a host of new job opportunities. NEW DELHI : Compulsory corporate social responsibility is likely to increase the demand for professionals in this field by as much as 50% in the coming years and the industry is likely to see at least 50,000 more job opportunities in the CSR sector, experts say.

giving something back to the society and with this law, the number of people exploring CSR as a career option will go up for sure.” Select companies would have spend 2% of their average profit over the last three years for CSR. This would be applicable to firms having turnover of Rs. 1,000 crore or more, or with net worth of Rs. 500 crore and above, or entities having net profit of Rs. 5 crore and more.

Around 8,000 companies would fall under the Companies Act’s ambit and this in turn would open a host of new job opportunities for individuals looking to work in the social development field. At present, the CSR work of a company is mostly done by corporate communications team but with this law, many firms would have to build a strong team of around five-six people for the purpose. According to leading executive search firm GlobalHunt MD Sunil Goel, “the demand for CSR professionals will surge 50-60% and we may have to train fresh hands to fulfil this need of the industry”. Echoing similar sentiments, DLF Foundation CEO Rajender Singh said, “some of the demand for CSR professionals is likely to be filled with internal placement. However, the industry is likely to see at least 50,000 more job opportunities in the CSR sector”. According to experts, the social sector is already a

popular option and has low entry barriers and going forward, a lot of people could explore CSR as a career option. “CSR should see a spurt in career opportunities. But the real growth would be in effective CSR management agencies which would require a combination of management and CSR experts,” Ashwajit Singh, Chairman and MD, IPE Global, a management consultancy company for development sector, said. According to Changeyourboss.Com CEO Bhupender Mehta, “Big or small, every company makes efforts towards corporate social responsibility with intention of

Experts, however, believe that NGO’s may not be the target to build the CSR team, and many institutes such as TISS (Tata Institute of Social Sciences ) and XISS (Xavier Institute of Social Service) have trained talent that can be hired through campus placements for the purpose. They say people with experience in projects management in organisations like UNDP can also be invited to join the teams. “For the companies who will be honestly getting into this for the first time will not poach employees from NGOs, but may look at some sort of tie-ups to avoid the hassles of making the numbers,” Prisma Global Executive Director and COO Amitabh Roy Chowdhury said. (Agency)

ICCSR & University of Applied Sciences-Vienna Launches India’s First CSR & Ethical Management Programme CSR & Competitiveness MUMBAI : Indian Centre for CSR (ICCSR) in association with University of Applied Sciences Vienna has launched its First Batch of Global Master of Sciences in CSR & Ethical Management, which is designed to put executive careers on the fast track and to teach working professionals how to generate fresh ideas on building sustainable business.

“As Company bill emphasizes the need for creation of CSR committees to supervise and monitor CSR, Creation of CSR Division and appointment of Independent CSR Directors, companies will require a qualified CSR professional. Thus, the need for such a World-Class course cannot be over emphasized.” Rajesh Tiwari Director General & CEO Indian Centre for CSR

With passing of New Company Bill, ICCSR was inundated with request to provide professionals who are trained in the field of CSR. Hence, it has collaborated with Star Rated University of Europe- University of Applied

Key faculty are Martin Neureiter, chairman of ISO 26000 the guiding standard for CSR and the most celebrated CSR speaker and writer; Tobias Webbs, chairman of Ethical Corporation who has earlier advised Government of UK, France and Germany in CSR policy; Dr. Michael Hopkins, PhD in Economics and has worked with IBM, ITT, the United Nations, the World Bank, Oxford, Harvard, Middlesex, Geneva, GMU, Brunel; Irene Daskalakis, World’s most acknowledged legal luminary in the field of CSR and advises fortune 500 companies in CSR & Sustainability and Yann Queinnec. The program also features the cutting-edge innovative curriculum, which is supported by University of Applied Sciences’ distinctive attitude towards quality education.

Sciences, Vienna, to start one of its kind programs taught by the Global Faculty. The program is uniquely designed to cater to the requirements of working professionals as well as full time students who wish to pursue their dream of working for benefit of People, Planet & Society.

CSR & Competitiveness | October 2013

Speaking about the composition of the students in the class, Martin Neureiter, Program Director said, “This class has unique mix of talent with many of them having excelled in their respective fields. I am sure these students will be the change agents and apply knowledge to address an actual company’s challenge of sustainability.”

“We are embarking on new, cross-border ways in the international education as qualified CSR Manager. Rest assured that we are going to put much energy and effort into this seminal and hopefully sustainable education track and that we will support you together with ICCSR to the best of our ability in reaching your goals. Specifically tailored to requirement of the day, the Program is anchored in the rigorous, CSR and sustainability management curriculum.” Dr. Helmut Holzinger Director University of Applied Sciences Vienna

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Canon India on a Positive Trajectory to Support Eye Care, Education and Environment Canon donated eye check-up machine to village Ferozepur in Mewat District of Haryana Under its ‘Adopt a Village’ social initiative. CSR & Competitiveness NEW DELHI : For growth to be responsible, it should go beyond numbers and should do well for the society to create a better world. That’s the kind of growth that Canon India believes in, and constantly strives for. In line with its continued commitment to the society, Canon India added another milestone to its philanthropic efforts by donating an eye check-up machine to the vision centre at village Ferozepur in Mewat District of Haryana on October 10, 2013. Under its ‘Adopt a Village’ social initiative, Canon India had undertaken the responsibility of developing the village infrastructure last year to provide seamless support to its inhabitants with core interventions in Eye care, Education and Environment for a period of three years. In the last one year, significant progress has been recorded by Canon India in the village with respect to education of the girl child. While the enrolment of girl child in senior classes increased by 45% from last year, the number of teachers at the school also increased from 9 to 44, post Canon’s adoption of government school in the village. Regular parent-teacher meetings are conducted at the school for creating awareness amongst parents. Teachers are trained on a monthly basis under the program. Expressing his views on the occasion, Kazutada Kobayashi, President & CEO, Canon India said, “As a part of the ‘Adopt a Village’ project, Canon India has established a sustainable eye care facility –a vision centre at the village to treat cataract. We are proud of this facility as it has seamlessly supported our efforts towards eye care through screening of over 6,000 patients in the last one year. 52 eye screening camps have been

“At Canon, our commitment to good governance, ethical conduct and social responsibility is the core to our way of doing business, and is strongly aligned with our drive to create and increase value for all stakeholders. We define CSR as conducting business in ways that provide social, environmental and economic benefits for the communities and geographies where we operate. In addition to offering excellent products and services worldwide, we have strived to ensure full compliance, protect the global environment, and provide humanitarian support around the world.”

organised at the facility and 187 surgeries have been conducted in partnership with the ICare Eye Hospital, Noida. We hope that the eye check-up machine being donated by Canon India today further strengthens our endeavour to increase these numbers to benefit as many people as possible.” Canon India has contributed towards the development of the village infrastructure through donation of benches, installation of water taps, painting the school premises and providing books for the library in Ferozepur village’s school resource center. Furthermore, Canon India also plans to start English language classes for the students under Canon’s employee volunteering programs, which would ensure a close connect between the employees and the villagers. As a responsible business, Canon India takes pride in being socially inclined and focuses on sustained and effective CSR projects. The CSR policy aligns with the corporate philosophy of Kyosei, which means living and working together for common good. Other CSR projects undertaken by the company include adoption of 3 rapid Key CSR projects metro stations for creating a green belt Adopt a village around them in Gurgaon and a photo exchange program between Canon • Enrolment of girl child in senior classes increased by 45% from last year. India and Canon China wherein kids in • Increase in the number of teachers at the school from 09 to 44. the adopted villages of these two coun• Screening of over 6,000 patients in the last one year. tries click pictures with Canon cameras • 52 eye screening camps have been organized at the facility. and share them across boundaries with • 187 surgeries have been conducted in partnership with the I Care Eye Hoseach other. pital, Noida. Going forward, Canon India plans to in• Adoption of Rapid Metro Stations itiate its village adoption programmes • Adoption of 3 rapid metro stations for creating a green belt around them in Bangalore & Mumbai. in Gurgaon Canon India strongly believes that the Photo exchange program enhancement of CSR activities and pro• A photo exchange program between Canon India and Canon China cesses currently taking place are set to wherein kids in the adopted villages of these two countries click pictures further entrench the vibrant culture of social responsibility that already exists with Canon cameras and share them across boundaries with each other. in the company.

Kazutada Kobayash President & CEO, Canon India

States Must Not Pocket CSR Funds CSR cannot be mandated. And the money should not be misused to divert funds into the pockets of politicians. The need is to clean up political funding so that companies do not pick up the tab, off their books.

The Chhattisgarh government has asked private companies to deposit the money they spend on corporate social responsibility (CSR) in the chief minister’s fund. It is a bad idea, akin to charging an extra tax on companies when the whole effort should be to cut their burden on taxes. It must be clear that CSR is neither charity nor philanthropy. The recently-enacted companies law says that firms should spend at least 2% of their profits on CSR projects or explain why they could not, in their annual reports. The point is that every company already contributes to the larger good of society by creating jobs and income, investing in technology and converting people’s pooled savings into

CSR & Competitiveness | October 2013

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productive capital. They create wealth for shareholders and also pay taxes. Industry bodies such as CII and FICCI should provide a common template to explain how companies are doing corporate service to society. Firms that do not undertake CSR can use this in their annual reports. CSR activity that does not shore up profits is misuse of shareholder funds. However, if companies can do activities that also raise their own revenues, it fits the bill for CSR. One example is Hindustan Unilever. It educates people about the benefits of washing their hands with

soap for better hygiene, improving public health. Similarly, an IT company that provides, say, engineering education and improves the company’s business is also contributing to welfare. But it should be left to companies to decide whether they want to spend on such activities and also how much to spend, if shareholders are fine with the idea. CSR cannot be mandated. And the money should not be misused to divert funds into the pockets of politicians. The need is to clean up political funding so that companies do not pick up the tab, off their books. (Economic Times, 17 September 2013)

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From CSR to Shared Value – the New Competitive Advantage for Businesses CSR & Competitiveness “Business is the only institution in the world that can provide value to the society and environment,” said acclaimed professor Michael E. Porter of Harvard University, during his keynote address at Institute for Competitiveness Porter Prize Strategy Awards. The Awards took place on October 11, 2013 in Gurgaon. It is believed that a business is run only to make money, but the fact is that it has evolved and is able to contribute more to social and environmental issues than the Government or NGO. Lack of funds to resolve societal challenges, along with traditional ways of dealing with these problems not working anymore, businesses are meeting the needs by creative thinking; they are working harder to show they care. Businesses are places where prosperity has to be created, and as they stand aware today, with sustainability as the prime issue. The traditional way a business contributed to the soci-

ety was through philanthropy or CSR (Corporate Social Responsibility). “CSR is a part of the business, which is run on the side of the main business and thus, does not make much impact. The most powerful way in which a business can make an impact is through an evolved business model, where business makes profit by meeting societal and environmental needs. And this gives birth to the ‘shared value’ proposition,” said Porter. If businesses invent products according to social needs, with a business model in place, it can resolve problems. Many companies might believe that their CSR does the same, but there is a difference. The concept of shared value can be defined as policies and operating practices that enhance the competitiveness of a company while simultaneously advancing the economic and social conditions in the communities in which it operates. Shared value creation focuses on identifying and expanding the connections between societal and economic progress. There are numerous ways in which addressing societal concerns can yield productivity benefits to the

firm. For example, when a firm invests in a wellness programme, society benefits because employees and their families become healthier, and the firm minimises employee absences and lost productivity. Porter believes that businesses can make profound money by shared value. Companies resisted efforts towards societal improvements as they thought that it might affect their profits, but with more studies about these issues, we learn that the solutions to such problems do not ask for a profit compromise. Businesses need to decide their focus in order to create shared value effectively, which is slowly becoming the new competitive advantage for businesses. Michael E. Porter is a leading authority on competitive strategy; the competitiveness and economic development of nations, states, and regions; and the application of competitive principles and strategic approaches to social needs, such as health care, innovation, and corporate responsibility.

Mandatory CSR may not Create Impact : Michael E. Porter NEW DELHI : Businesses should address social problems through profitable business models rather than through mandatory corporate social responsibility (CSR) activities, said Michael E. Porter, professor at Harvard Business School and a leading expert on competitiveness strategy. Porter also said businesses, through their strategic thinking and value creation, will be critical to India’s economic progress in the coming years. He was speaking via video conference at the second Porter Prize awards on Friday organized by the Institute for Competitiveness, an affiliate of the Institute of Strategy and Competitiveness at Harvard Business School. Mandatory CSR activities may not create an impact as businesses may just look at allocating money for such activities rather than seeking optimal ways for addressing social issues, Porter said. The most powerful way a business can have an impact on society is with a business model in which social issues like nutrition and poverty can be addressed and societal needs met while creating profit, he said. “That’s the only way to create impact.

Meeting the needs and meeting those needs at a profit is crucial”, he said. Businesses are facing increasing pressure to play a role in solving India’s societal problems. Companies are being made to donate for social causes, but there is no evidence that it is creating any difference, he said. India’s new company law asks companies with a net worth of more than Rs. 500 crore or revenue of more than Rs. 1,000 crore or net profit of more than Rs. 5 crore to spend 2% of their average net profit over the three preceding years on CSR activities. “Organizations just sprinkle money around, but there is no social impact and no solution arises from this approach,” Porter said. Businesses will have to actively involve themselves in addressing the country’s social and environmental problems, he said, adding, “Businesses are being seen as not necessarily contributing to society but instead causing social problems by actions like laying off people”. (Mint)

Businesses should address social problems through profitable business models Michael E. Porter

K. C. Mahindra Scholarships for Education Abroad CSR & Competitiveness

Anand Mahindra Trustee of K C Mahindra Education Trust and Chairman and Managing Director, Mahindra & Mahindra Ltd.

CSR & Competitiveness | October 2013

MUMBAI: The K.C. Mahindra Education Trust has announced K. C. Mahindra Scholarships for Post Graduate Studies Abroad for the year 2014. Three K.C. Mahindra Fellows will receive an interest free loan scholarship of Rs. 8 lakh each, while another 50 candidates will receive an interest free loan scholarship of Rs. 2 lakh each. The K.C. Mahindra Education Trust selects scholarship recipients based on their financial needs and academic achievements. This year, the trust received 664 applications from students who have obtained admission in several Ivy League universities both in the US and the UK, trust said in the statement. The three K.C. Mahindra Fellows – Ashrita Kotha, Gautam Chopra and Antariksh Both-

ale – hail from very diverse backgrounds and displayed remarkable grit and determination to rise above their challenging situations. They have secured admission into prestigious universities such as Oxford, Yale and Washington, epitomizing the Mahindra Group’s philosophy of Rise. “Since 1956 the KCMET realized the potential of the Indian student and decided that it was time to celebrate the cerebral. It has been the trust’s constant endeavour to look at people with humble beginnings and make them realize their aspirations, recognising that money must never come in the way of achieving the

true potential of an individual. KCMET firmly believes that there is no greater denial than the denial of opportunity. Its avowed vision is to Enable, Provide and Catalyze. In that context, over the last six decades there has been nothing but happiness when some of India’s finest minds irrespective of caste, creed and colour achieve their aspirations.” said Anand Mahindra, Trustee of K C Mahindra Education Trust and Chairman and Managing Director, Mahindra & Mahindra Ltd. The applicants will be pursuing their post graduation in a number of subjects ranging from Computer Science, Engineering, MBA, Law and Economics, in various universities including Harvard, Stanford and Georgia Institute of Technology in the USA, as well as the University of Cambridge and Oxford University in the UK.

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Dedication, Not Money, Matters During Calamities Says Nita Ambani Herself an educationist and a philanthropist, Nita Ambani chairs Reliance Foundation, which is leading relief works including rebuilding schools in various natural calamity-affected areas of Uttarakhand.

GUPTKASHI (Uttarakhand) : Taking forward relief work for over 25,000 people affected by floods in Uttarakhand, Reliance Foundation Chairperson Nita Ambani has said that it is the dedication and sincerity towards lending a helping hand that matters more than money during times of natural calamities. “At this moment, I think more than finance (what is important) was the people’s dedication and sincerity… I think what is more important is human aspect. Many of them just wanted to talk and we just provided them the listening because you cannot imagine the kind of trauma that has happened,” said Nita Ambani, whose husband Mukesh Ambani heads one of the country’s biggest corporate houses, Reliance Industries group.

“The cloudburst and the consequent devastating floods have taken away thousands of lives and affected the livelihoods of a million people. And in true Reliance spirit, the Reliance Foundation team rose to the occasion on a war footing with relief operations.”

Herself an educationist and a philanthropist, Nita Ambani chairs Reliance Foundation, which is leading relief works including rebuilding schools in various natural calamity-affected areas of Uttarakhand. Speaking to reporters after visiting a Government College here, she said: “As human beings, what we can do is extend help in whatever way possible.” In the state, the Foundation is currently focusing on livelihoods, education and healthcare for villagers and locals in Uttarakashi and Rudraprayag.

Nita M. Ambani Chairperson Reliance Foundation

“For me the most important thing is to get children back to school. I believe primary and secondary education is the bedrock of any sustainable society… Education is our priority at this moment,” she said.

Among others, the foundation has set up a mobile healthcare unit with another one getting ready. When asked about inspiration for philanthropic activities, she said, “I just enjoy. I love what I do and don’t want to change it for anything (else) in this world”. Reminiscing her younger days, Ambani said she came from a middle class family and those values still stay with her. “My background is that I came from a middle class family and I think those values stay where ever you go,” she said. “When I was walking up, it was not difficult because we all had to walk to school, we did not have a choice when we were young,” she said after making a steep climb to the Lawara school here. Reliance Foundation plans to cover about 25,000 people (around 5,000 households) through its activities focused on providing livelihood for people in Uttarakhand. The foundation would support construction of temporary shelters before the winter in 40 villages apart from helping in construction of community shelters in the coming months. “On paper, there are some causes but when something like this happens, it does not matter. We just want to be there and help in whatever way we can,” she said. On the education front, the foundation would support rebuilding Government Inter Colleges at Lawara and Tainthi besides Takshshila public school at (Agency) Agastmuni in Rudraprayag district.

‘Corporates Should Take CSR Law Positively’ Billionaire industrialist and software czar Azim Premji also said that philanthropy cannot be forced upon and has to be spontaneous, while referring to the CSR spending provision in the Companies Act 2013.

GUPTKASHI: Calling upon India Inc to take the new CSR law in a positive way, Reliance Foundation Chairperson Nita Ambani has said it should help in creating sustainable and self-reliant communities. Nita Ambani, whose husband Mukesh Ambani heads the country’s leading corporate house Reliance Industries group, was here to oversee relief work being undertaken by Reliance Foundation in areas ravaged by the Uttarakhand floods in June. “CSR (Corporate Social Responsibility) is a process that creates sustainable and self reliant communities by lending a hand to realise their aspirational goals,” Nita Ambani told. A well-known educationist and philanthropist, Nita said that everyone needs to be taken along for society’s sustainable

CSR & Competitiveness | OCtober 2013

growth and welfare. Asked about the historic CSR clause of the new Companies Act 2013, which mandates companies with significant size to mandatorily spend two per cent of profits on social welfare schemes, she said: “I think it is an important step and should be taken in the positive spirit...

in areas like education, health and rural transformation. The CSR law has evoked mixed reactions among the corporate leaders, with some of them saying that the companies should not be forced to spend on social welfare and such activities should rather be undertaken on their own.

“... because unless the society moves along taking everybody together, you cannot have a sustainable society.” Reliance Foundation is carrying out extensive relief and rehabilitation works in natural calamity-hit areas of Uttarakhand. It plans to cover about 25,000 people (around 5,000 households) through its activities focused on providing livelihood in the state.

Recently, billionaire industrialist and software czar Azim Premji also said that philanthropy cannot be forced upon and has to be spontaneous, while referring to the CSR spending provision in the Companies Act 2013.

The Foundation, which is pursuing activities in various states, is mainly working

The two per cent CSR spending would be applicable to companies having turnover of Rs 1,000 crore or more, or those with net worth of Rs 500 crore and above, or entities having net profit of Rs 5 crore and more.

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Our Philosophy is Deeply Rooted in the Principles of Sustainability In an interview with Rusen Kumar, Editor, CSR & COMPETITIVENESS; Alka Talwar, Corporate Head – CSR, Tata Chemicals Limited, shared about various CSR projects, vision of the company and views on various contemporary issues in the area of CSR and allied areas.

Brief us about Tata Chemicals Ltd.’s vision, mission and objectives towards sustainability and community development as well as historical backdrop?

Alka Talwar is currently heading the Corporate Social Responsibility Function at Tata Chemicals. She looks after the CSR programs across the enterprise that includes projects on natural resource management, environment conservation, rural energy, sustainable livelihoods, empowerment and improving the quality of life. She has worked with Tata Chemicals in various functions over the last 27 years, which includes heading the community development functions at Mithapur Gujarat and at Babrala Uttar Pradesh. She is also Hon. Trustee &Hon. Secretary of Tata Chemicals Society for Rural Development, Okhai – Centre for Empowerment and Uday Foundation (only Hon. Trustee) She has done her bachelors in architecture from CEPT University and has also coauthored two papers on The New Corporate Citizenship & Development and Linking Social enterprise with Social change: the mediating role of Empowerment.

CSR & Competitiveness | October 2013

TCL believes in a cohesive, inclusive and integrated society, in which all individuals have access to opportunities for personal growth and inclusive economic growth. The present socio-economic environment necessitates a more constructive role by industry for achieving inclusiveness and complementing the ongoing efforts of Government and civil society in enhancing social equity. Tata Chemicals has always considered CSR as an important business driver and has over the years articulated its approach through various policies to drive its CSR agenda. These polices include the Sustainability policy, Community Development policy, Climate Change policy and the Social Accountability policy. Recently, in a bid to ensure a focus on the socially backward communities, the ‘Affirmative Action Policy’ has also been formulated. Our ongoing endeavor is to create sustainable enterprise strategy that is in line with our Mission statement ‘Serving Society through Science’. As Leader you are responsible for the company’s strategic management and direction. How Corporate Social Responsibility is attached to your company’s business and operations? Our Corporate Social Responsibility programmes extend well beyond compliance and incorporate some benchmark practices, now adopted by others within and outside the Group. Sustainability and stakeholder engagement is the very core of our organization. At the heart of our leadership system is the concept of proactively understanding and responding to the needs and expectations of our stakeholders. We sincerely believe that understanding and responding to the needs and expectations of our stakeholders drives the organization towards sustainable business practices.

CSR is an important business driver. It leads to what we call responsible business that looks at the profit, people and planet dimensions equally. To create sustainable enterprise, inclusive, cohesive and integrated economic growth is a must where all the individuals have equal access to the opportunities for personal growth.

separate corporate sustainability policy which was adopted in September 2005. You are in core management team of TCL, whichare your focus areas for CSR and related projects initiated under your leadership? Keeping in mind the geological, environmental, cultural and economic differences of these regions, TCSRD develops and implements programmes tailored to the needs of each region for maximum impact. TCL development interventions are divided into four inter-related components, namely : creating sustainable resource base through natural resource management, promotion of alternate source of energy and environment conservation programmes, building sustainable livelihood through both farm and non-farm based livelihood programme; empowerment by strengthening Community Based Organizations (CBOs) such as SHGs, User groups, Pani Samities, Bhoomi Sudhar committees etc.; improving quality of life through Health, Education and Infrastructure support programme. What is your Annual CSR budget?

From a humble beginning almost 33 years ago, TCSRD has successfully created an impressive network spread over Gujarat (Mithapur), Uttar Pradesh (Babrala) and West Bengal (Haldia). Our company is constantly endeavoring to further the TATA philosophy of good corporate responsibility. With the spread of our operations now extending beyond India, we have commenced several social responsibility programmes in our overseas locations. The objective of social responsibility is equally well-entrenched in the minds of our employees, who play an active part in empowering rural communities to chart their own development.

Our annual budget is going on increasing every year. In 2012-13 it was Rs. 9 crores. This budget does not include what we spend on providing health care and education services to the communities through our hospital and schools.

Has TCL framed any CSR policy? When it was adopted?

Yes, we do have the tradition of publishing Annual CSR report.

Yes, it has a separate community development policy. It was adopted in November 2000. TCL also has a

What are the ongoing CSR projects in various locations?

Do you have a CSR team to implement projects? Yes, at all the three locations we have dedicated community development team which caters to the changing needs of the community around our TCL facility. Do you have any tradition to publish Annual CSR report?

Interview TCL development interventions are divided into four inter-related components, namely: Creating sustainable resource base through natural resource management, promotion of alternate source of energy and environment conservation programmes, building sustainable livelihood through both farm and non-farm based livelihood programme; Empowerment by strengthening Community Based Organizations (CBOs) such as SHGs, User groups, Pani Samities, Bhomisudhar committees etc; Improving quality of life through Health, Education and Infrastructure support programme. Kindly share your unique CSR project? Agriculture development and animal husbandry programme in Babrala; income generation programme through rural entrepreneurship development, vocational training, handicraft promotion, rural BPO at Mithapur and Babrala; pond management and ornamental fish culture at Haldia; Ecoclubs, saving the species like whale shark at Mithapur. What is your perception about Government of India’s emphasis on CSR? Intent of government is good and we intend to follow it. The CSR initiatives which have been implemented in all its three locations since past two decades would be continued by the company. How will you define the Corporate Responsibility in Indian context? CSR is an important business driver. It leads to what we call responsible business that looks at the profit, people and planet dimensions equally. To create sustainable enterprise, inclusive, cohesive and integrated economic growth is a must where all the individuals have equal access to the opportunities for personal growth. Sustainability has positive impact on overall development of organization. Do you think that Sustainability needs to be integrated into the heart of business policy and strategy? Yes, TCL’s corporate philosophy is deeply rooted in the principles of sustainability which implies a commitment to environmental stewardship while adding economic value, promoting human rights and building social capital, all of which are in keeping with a ‘Triple Bottom-line Approach’. Our sustainability goals cover systems, people and programmes in a manner that combine the four essential dimensions of human, social, environmental and financial benefit. The establishment of the Tata Chemicals Society for Rural Development (TCSRD) emphasizes the company’s commitment in this regard. What are the recent trends in Sustainability in India in your perspective? Sustainability and stakeholder engagement is the very core to an organization. Proactively understanding and responding to the needs and expectations of the stakeholders is the key to the success of any organization as this drives the organization towards sustainable business practices. Why Corporate Social Responsibility issues are becoming more crucial for the business? For the company to sustain in this competitive environment, CSR issues are very crucial. The present socio-economic environment necessitates a more constructive role by industry for achieving inclusiveness and complementing the ongoing efforts of Government and civil society in enhancing social equity. Brief us about major CSR initiatives? We have various ongoing CSR projects like Natu-

CSR & Competitiveness | October 2013

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ral Resources Management, Environment conservation and care programme, Livelihood development programme, improving the quality of life. I want to explain in detail the projects. Natural Resource Management : Natural Resource Management addresses the issue of direct employment generation through its growth-driving vehicle namely the integrated water management programme, agriculture development programme, pond management and animal husbandry programme. Integrated water management is the key programme of TCSRD in the Mithapur region of Gujarat as non availability of quality water is one of the biggest concerns of this drought prone region. This programme has helped in creating 246 million cubic feet capacity of water in the parched area of Mithapur and has provided critical irrigation to over 6895 acres of land. 236 medium water harvesting structurelike check dams have been built for better percolation and water harvesting.2165 small water harvesting structure like farm ponds, farm bunds has been deepened and salinity pushed back by increasing the underground water buffer. 270 drip irrigation and sprinklers and cultivation of crop which is less water intensive have helped in saving and conserving the water. 1702 roof rain water harvesting structures has made portable water available to villagers throughout the year. The programme has helped in improving the production by 40% and a direct economic gain by Rs. 240-270 lakhs per year. Agriculture growth at Babrala has followed a three pronged strategy i.e. crop diversification, building capacity of farmers and promotion of new modern agricultural systems and technology. Through this programme, 3357 farmers have been benefitted and have got better returns for their toil and sweat. Animal Husbandry is another key programme which provides additional financial support to the farmers below the poverty line. TCSRD supports by providing animal health check up at the door step and also at the animal health clinic, Babrala. Breed improvement, cattle insurance, green fodder demonstrations are some of the other services being provided under this programme. Environment conservation and care programme: Environment conservation and care programme encompass renewal energy and bio diversity reserve plantation project. Restoration and conservation of coastal ecosystems like coral reef restoration, mangrove plantation and protection of endangered species like whale shark, Asiatic lion have been undertaken in partnership with institutions of excellence like Wild Life Trust of India (WTI), International Union for Conservation of Nature (IUCN). 275 Whale sharks have been rescued till now. Eco clubs have also been formed to create awareness among the community members on environment conservation. Under the promotion of renewal energy, 31 solar street lights have been installed at public places and 85 solar lanterns have been distributed at Babrala. Energy efficient smokeless stoves are being promoted across locations. 200 such stoves have been installed at Mithapur and Haldia. Eight Biogas plants have also been constructed to generate energy by making proper use of cow dung. The gas is produced by Biogas plants are also being used for cooking food. Livelihood development programme : Livelihood development programme seeks to strengthen income-generating capacity of marginal farmers who are not adequately covered by

the “Natural Resource Management Programme”. It focuses on micro-enterprise development, aimed at building capacities through extensive training, helping identify enterprise opportunities and supporting these activities through micro-finance and marketing. The main vehicles driving this component are the formulation of Self-Help Groups in villages, the Rural Entrepreneurship Development Programme, skill building through vocational training programme, Uday Foundation (rural BPO) and promotion of rural

TCL’s corporate philosophy is deeply rooted in the principles of sustainability which implies a commitment to environmental stewardship while adding economic value, promoting human rights and building social capital, all of which are in keeping with a ‘Triple Bottom-line Approach’. Our sustainability goal covers systems, people and programmes in a manner that combine the four essential dimensions of human, social, environmental and financial benefit.

handicrafts (Okhai). This programme has spurred the self help group members into utilizing their idle savings for investing in an enterprise. It has helped in increasing individual savings leading to enhanced financial security. Collaboration with local training NGO and GOs like Dalit Shakti Kendra, NABARD, and Gram Technology has further strengthened this programme. So far, 5521 people have undergone skill development training programme across the three locations covering 62 villages. Improving the quality of life : Improving the quality of life which is the base level development component, focuses on health, education and infrastructure, wherein TCSRD helps in improving women and children health care services and infrastructure facilities. By building the capacities and creating awareness, TCSRD has been able to provide the right kind of guidance and facilitation. Villagers are not only willing, but also capable of undertaking developmental work in their villages. This was most evident in villages covered under the integrated watershed development programme where the farmers were willing to invest as much as Rs.20,000 in pipelines, pump sets, etc. in order to draw water for irrigation from the dam to their fields.

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Arundhati Bhattacharya Appointed SBI’s First Woman Chairperson

the trend of women rising to

CSR & Competitiveness Monday, October 7, was a historic day for the country’s largest lender State Bank of India (SBI) that boasts a 207-year history. Bhattacharya, 57, who has been managing director (MD) and chief financial officer since August 2013, will hold the office for a period of three years. She succeeds Pratip Chaudhuri who retired on September 30. The three other SBI MDs who were interviewed for the chairman’s position were Hemant G Contractor, A Krishnakumar and S Viswanathan. Unlike other public sector banks (PSBs) that have a combined post of CMD, SBI has a chairman/chairperson and four MDs. With Bhattacharya now becoming the chairperson, SBI will likely soon have a new CFO and a new MD. Bhattacharya joined SBI as a probationary officer way back in 1977. During her 36-year career, she has had stints in areas such as retail, treasury and corporate finance, and performed in a range of roles like deputy MD, corporate development officer, CGM, head of external audit and correspondent relations, CFO and MD. She also headed SBI’s merchant banking arm SBI Caps. Besides, Bhattacharya played a key role in launching SBI’s forays into general insurance, custody services and infrastructure fund subsidiaries. Her appointment deepens the trend of women rising to the banking fore in India, and precedes

Gender Equity Means Business – Women’s Empowerment Principles Consultation in Mumbai This event is open by invitation for corporate representatives to attend. November 27, 2013 Hotel Sea Princess, Juhu, Mumbai CARE India is hosting a consultation to build a stronger commitment to gender equality and women’s empowerment within corporate sector in India. This consultation will build upon the work that CARE India, UN Women and Global Compact Network have done so far to help strengthen gender equality in the private sector through the Women’s Empowerment Principles (WEPs) project. The WEPs function as a catalyst for change, within corporations, committed to driving the gender equality and women’s empowerment agenda within the organization. This collaborative project aims to not only increase the commitment of corporations to integrate WEPs into their policies, but also to provide guidance on implementation within the organization. “The WEPs platform helps building a stronger commitment to gender equality and women’s empowerment within corporate sector in India by sharing ‘best practices’ and salute business leaders on corporate leadership in promoting gender equality,” says Dr. Muhammad Musa, Country Director & CEO, CARE India. CSR & Competitiveness | October 2013

Her appointment deepens

launch of Bhartiya Mahila Bank, the country’s first bank dedicated for women. The government has also been trying to set up all-women bank branches.

the banking fore in India, and

SBI and its five subsidiaries control over one-fifth of the nation’s banking assets and is the 66th largest bank in the world.

Mahila Bank, the country’s first

Bhattacharya joins a select club of woman bankers at the helm of leading banks in India. Among the PSBs, Allahabad Bank is chaired by Shubhalakshmi Panse, Bank of India by Vijayalakshmi R Iyer and United Bank of India by Archana Bhargava. Among private sector banks, ICICI Bank is led by Chanda Kochhar and Axis Bank by Shikha Sharma. Among foreign banks in India, HSBC India is chaired by Naina Lal Kidwai, JP Morgan India by Kalpana Morparia and RBS India by Meera Sanyal.

precedes launch of Bhartiya bank dedicated for women. The government has also been trying to set up all-women bank branches.

During her 36-year tenure at the bank she has held a number of important positions, including those of deputy managing director and corporate development officer, chief general manager (Bangalore Circle) and chief general manager (New Businesses). One of the last bastions of male dominance crumbled when the government named Arundhati Bhattacharya as the first woman chair of the 206-year-old State Bank of India, which together with its subsidiaries, accounts for 22% of the country’s bank deposits and 23% of total lending. Bhattacharya is also the first woman to ever lead a Fortune 500 company in India, and the only woman banker on that list of giants anywhere in the world.

More Women Leaders, Means Higher Levels of Corporate Social Responsibility This study indicates that companies with more women leaders are not only more committed, on average, to corporate social responsibility – they may also be better at it, in the sense that such companies are likely to develop higher-quality CSR initiatives. CSR & Competitiveness What’s good for women is good for business and also for society, suggests a study conducted by researchers at New York based voluntary organization Catalyst and Harvard Business School in the year 2011. The study tracked philanthropic donations in Fortune 500 companies from 1997 to 2007 globaly. According to ‘Gender and Corporate Social Responsibility: It’s a Matter of Sustainability’, companies with more women at the top may be better practitioners of corporate social responsibility. Researchers from Harvard Business School examined how corporate leadership and organizational structure influence CSR by utilizing the most visible form in the United States: corporate philanthropy. Focusing specifically on how women leaders might impact CSR, researchers from Harvard Business School and Catalyst conducted follow-up analysis. Compared to companies without women executive leaders, research found that companies with gender-inclusive leadership teams contributed, on average, more charitable funds. According to the report, Companies with more women corporate officers donated significantly more funds between 1997 and 2007, and for each percentage point increase in women corporate officers, yearly donations increased by $5.7 million. Controlling for key factors that might influence donation levels, such as a company’s overall financial performance, size, and industry, the presence of women leaders still had a significant positive impact on a company’s levels of giving. Studies have shown that women leaders may bring diverse perspectives on fairness and the distribution of resources to donation decisions, which may in turn broaden a company’s commitment to CSR and increase its levels of charitable giving. This study in-

dicates that companies with more women leaders are not only more committed, on average, to corporate social responsibility – they may also be better at it, in the sense that such companies are likely to develop higherquality CSR initiatives. Leaders who highlight gender issues in CSR strategies often position their organisations for sustained growth – a payoff that extends from the company to communities and to broader society. Having gender-inclusive leadership can influence the level or quantity of philanthropic investment corporations make in CSR. But we also speculate that by keeping gender issues prominent, gender-inclusive leadership likely also affects the quality of CSR initiatives. When leaders spotlight gender issues in their CSR strategies, they often position their organization for sustained growth, and the payoff extends beyond the company to society. Focusing on the roles women play in the marketplace is one way companies can create success through CSR initiatives. For example, Campbell Soup Company’s supplier diversity program aims to develop a supply base that reflects its consumer base, giving companies owned by women an equal opportunity to sell services and products to the company. RBC devised programs such as the This research suggests that gender-inclusive leadership is good for business and society. Findings demonstrate that corporate stakeholders understand the value of gender-inclusive leadership and its positive influence on the quantity of a company’s CSR activities. Genderinclusive leadership may also increase the quality of CSR initiatives. Companies with both women and men leaders in the boardroom and at the executive table are poised to achieve sustainable big wins for the company and society.

Focus

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Hindustan Copper Limited on a Growth Path CSR & Competitiveness Hindustan Copper Limited (HCL), a Mini Ratna Central Public Sector Undertaking under the Administrative Control of the Ministry of Mines was incorporated in November 1967. It is the only integrated primary copper producer in the country holding all the operating mine leases in India. Its copper mines are spread over three well known copper deposits in the country, viz., Malanjkhand in Madhya Pradesh, Khetri in Rajasthan and Ghatsila in Jharkhand. The Government holds 90% of the paid up capital. HCL is listed in BSE & NSE stock exchanges. The main activities of the Company include mining of copper ore and production of refined copper as well as downstream products like Continuous Cast Copper Wire Rod. HCL has four operating Units, i.e., at Khetri (Rajasthan), Malanjkhand (Madhya Pradesh), Ghatsila (Jharkhand) and Taloja (Maharashtra). While Khetri and Ghatsila are fully integrated Units (from mining to ore beneficiation to smelting and refining), Malanjkhand has mining and ore beneficiation facilities and Taloja has only wire rod manufacturing facility. The net worth of the Company as on 31st March, 2013 is Rs. 1645 crore. The Company is consistently making profits since 2004-05.

a mix of internal accruals and debt. To augment the resource base of copper mineral in the Country, HCL has filed 16 new reconnaissance permit, prospecting license and mining lease applications in the States of Rajasthan, Madhya Pradesh, Jharkhand and Haryana. As soon as the Company gets lease, it will undertake detailed exploration followed by mine development and operation. This will add to the profitability of the Company. Achievements of Turnover and Profit/Loss of last three years are: (Rs. in crore) Particular Turnover Gross Margin Profit Before Tax Profit After Tax

2010-11 1281.28 436.02 335.21 224.10

2011-12 1638.18 618.51 472.91 323.47

2012-13 1475.27 558.24 403.61 355.64

HCL is on a growth path. The Company aims at becoming a highly profitable, socially responsible Nav Ratna Company in the days to come.

The domestic production of copper concentrate accounts for only 3% of the country’s requirement. The smelting and refining segment in India has significant over capacity and is dominated by two strong competitors. Hence, there is a vast potential to increase mining production through capacity enhancement and exploration. The Company’s growth strategy is to expand the mine and concentrate capacity significantly to sustain profitability even at low copper prices. At present, the Company is implementing an ambitious expansion plan to quadruple its mine capacity from 3.4 to 12.4 million tonne per year with a capex of Rs. 3435 crore. Eight mine expansion projects have been rolled out concurrently. The Company proposes to fund the investment through

K.D. Diwan CMD, HCL

Since its inception, HCL has been making significant contribution towards upliftment of living conditions of the local people in the areas where it had established its mines and production units - like providing drinking water, social forestry, rural health camps, and vocational training for the local people on a regular basis. Forty years of sailing through various market trends – upwards and downwards – the year 2007 saw HCL embracing a CSR map for socio-economic development programs for adjoining mining areas.

Corporate Social Responsibility Philosophy

During the year 2012-13 the Company has achieved best ever profit after since inception.

“We believe in the interdependence of the industry with the community for sustainable growth. CSR is an approach to acknowledge core values of this interdependence. We strive to achieve this by facilitating improvements in the quality of life and by supporting socio-economic development of the regions where we operate.”

Corporate Social Responsibility

For HCL, CSR is an effort to reach out beyond copper-mining and “giving-back” to the society, taking into consideration Company’s capabilities, and expectations of the communities living in and around the areas of its operations. The objective of HCL is to play a catalytic role in the socio-economic development in the region, where the industry is located, aiming to create an enabling working environment for HCL, as well as income generation opportunities for the community - for building an empowered community for an overall sustainable growth and peaceful co-existence.

Policy Framework & Objectives In conformity with the government directives, prevailing at the time of inception, HCL had provided employment and other benefits to the eligible land oustees, aiming at improving overall economic status of project affected people. For the socio-economic development of the adjoining areas of existing Projects, HCL welcomes principles laid down by UNGC and the MDGs, and embraces the CII social code, for establishing and executing CSR Projects.

CSR Fund Utilisation Trend Amount of CSR funds earmarked and recorded to be utilised in different Units of HCL during the last three years and the current year: State & Unit Names Financial Years 2009-10 2010-11 2011-12 2012-13 Total Earmarked Total Utilised

KCC, Khetri Rajasthan Allocated

Spent

0 20.62 77.95 217.8 316.37

4.72 21.96 39.35 66.03

MCP, Malajkhand, MP Allocated Spent CSR (Rs. in Lakh) 0 0 36.00 59.00 130.25 40.80 214.2 380.45 100.62

ICC, Ghatsila, Jharkhand Allocated

Spent

0 44.72 86.80 198.00 329.52

4.72 32.86 66.77 104.35

Objectives •

To provide support for basic Health Care. Educate community on essential hygiene and sanitation practises and generate awareness on health issues – specially focussing on Immunization, RCH, HIV/AIDS.

•

Women Empowerment with skills and experiences to access their rights, to improve income, to meet their own and their families’ basic needs and to participate in the development of their communities.

•

Generate alternative employment means for the community through the Self-Help-Groups (SHGs), through improved management of existing resources, better access of information and understanding of entrepreneurial technicalities to start new income generation opportunities.

•

To mobilize resources from among the rural youth that furthers development of the villages. To empower adolescents with knowledge, capacity and skills to take control of their health, hygiene and life-style.

•

Enhance agricultural productivity with sustainable environment friendly practices through capacity building and imparting trainings to farmers.

TCP, Taloja, Maharashtra/ CO, Kolkata, West Bengal/Others Allocated Spent 0 4.10 5.00 81.00 90.10

0.50 7.38 15.26 23.14

1116.44 294.15

Source: Ministry of Mines, Govt of India

Hindustan Copper Extends Help for Uttarakhand Relief Work KOLKATA: Hindustan Copper Limited (HCL) has contributed an amount of Rs 2.0 Crores to the Prime Minister’s Relief Fund, towards relief, recovery and rehabilitation of the people affected from recent calamity in Uttarakhand. Additionally, the employees of Hindustan Copper Limited have voluntarily contributed their one day’s basic pay amounting to Rs 33.50 Lakhs to the Prime Minister’s Relief Fund for the purpose. K.D.Diwan, CMD, HCL, handed over the two cheques on this account to Dinsha Patel, Union Minister of Mines, in the presence of R.H Khawaja, Secretary, Ministry of Mines, and other senior officials of the Ministry for forwarding it to the Prime Minister’s Relief Fund. Mines Minister, Dinsha Patel appreciated the concerns displayed by HCL and its employees for a worthy cause.

CSR & Competitiveness | October 2013

K.D.Diwan, CMD, HCL, handing over the cheques to Dinsha Patel, Union Minister of Mines, in the presence of R.H Khawaja, Secretary, Ministry of Mines

News

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Coal India and Subsidiaries Contribute Rs 87cr for Uttarakhand Relief CSR & Competitiveness NEW DELHI: Mining major Coal India Limited and some of its subsidiaries have contributed Rs 87 crore for relief and rehabilitation of those affected by the recent floods in Uttarakhand. CIL, the holding company, contributed Rs 50 crore to the Chief Minister’s Relief Fund from the CSR budget for rehabilitation and re-construction in areas affected by natural calamity, a company statement said.

Naveen Jindal, Member of Parliament (Lok Sabha) and Chairman Jindal steel and Power Limited (JSPL) has donated Rs. 2.5 crore to the Prime Minister Relief Fund. Joining hands with their Chairman, the employees of Jindal Steel and Power Limited have also pledged to contribute Rs. 2.5 crore by donating their one day’s basic salary for the relief work undertaken by the government. A total of Rs. 5 crores has been contributed by the JSPL family for the relief fund.

The Dhandbad-based Bharat Coking Coking Coal Limited (BCCL, Jharkhand) contributed Rs 20 crore to the Chief Minister’s Relief Fund and Rs 7 crore to the Prime Minister’s National Relief Fund, it said. Two other subsidiaries, Mahanadi Coalfields Limited and Western Coalfields Limited, contributed Rs 5 crore each to PMNRF for relief work. With the relief and rescue operations on in the floods-ravaged Uttarakhand, donations, too, are pouring in. Movie star Ambitabh Bachchan took the lead from Bollywood by contributing Rs 11 lakh to the chief minister’s relief fund in the wake of the June 16-June 17 deluge. “We are happy Amitabhji has also sent money,” said an official. Uttar Pradesh is the largest contributor among states, with Chief Minister Akhilesh Yadav sending a cheque of Rs. 25 core. With this, Uttarakhand has got more than 200 crore of donations mainly from corporates and states. S S Rawat, secretary to the chief minister Vijay Bahuguna said that they are receiving funds from all over India. Delhi, Punjab and Haryana have contributed Rs 10 crore each while Karnataka, Gujarat, Tamil Nadu, Rajasthan, Madhya Pradesh and Bihar have contributed Rs. 5 crore each. The Border Security Force has given a cheque of Rs. 10 crore. Government of Maharashtra has announced an aid of 10 crore rupees to Uttrakhand. ONGC, SBI, BHEL, Bharat Petroleum, Mahindra & Mahindra and Bharti Enterprises have contributed between Rs. 1 crore and Rs. 2 crore each. Besides, the companies that have units in the state under the tax holiday scheme are also coming forward for the relief efforts. ITC, Nestle and Britannia have sent relief and food packages to the disaster-affected areas. The Confederation of Indian Industry (CII) has formed a task force to provide relief. A team is already camping in the worst-affected Rudraprayag

district. CII has identified clusters for relief and rehabilitation purposes in places like Augustamuni, Tilawara and Guptkashi in Rudraprayag and Pindar Valley in Chamoli. Naveen Jindal, Member of Parliament (Lok Sabha) and Chairman Jindal steel and Power Limited (JSPL) has donated Rs. 2.5 crore to the Prime Minister Relief Fund. Joining hands with their Chairman, the employees of Jindal Steel and Power Limited have also pledged to contribute Rs. 2.5 crore by donating their one day’s basic salary for the relief work undertaken by the government. A total of Rs. 5 crores has been contributed by the JSPL family for the relief fund. Bharat Coking Coal Limited (BCCL) ( BCCL ), a government undertaking under the Ministry of Coal has contribution of Rs.20 Crore to “Chief Minister’s Relief Fund, Uttarakhand” for the relief, recovery and rehabilitation of the people affected from recent calamity in Uttarakhand . State-run Hindustan Copper (HCL) contributed Rs. 2 crore for rescue and relief operations in the flood-ravaged Uttarakhand. Vedanta Hindustan Zinc’s employees donated one day’s salary in Prime Minister’s Relief Fund for the Uttarakhand Rehabilitation. This contribution has been made by all the employees of the company for the rehabilitation of Uttarakhand people who have been affected by the recent natural calamity. The company also joined hands and donated equivalent amount. The contribution of Rupees one crore has been made in the Prime Minister’s Relief Fund. After having rescued over 23,000 people in disaster-hit Uttarakhand, the Indian Air Force has now contributed for their rehabilitation by donating Rs 8.33 crore in the Prime Minister’s relief fund. Government of India on 19 June 2013 announced a disaster relief fund of 1000 crore rupees to Uttarakhand. Apart from the relief fund announced for the state, an ex-gratia assistance of 2 lakh rupees each to the families of those who have lost their lives and 50000 rupees to those who have been injured during the landslides and flood in the state will be provided from the Prime Minister’s National Relief Fund (PMNRF). For those, who have completely lost their houses the PMNRF ex-gratia assistance of Rs.1 lakh each will be provided, whereas 50000 rupees each will be given to those whose houses have been damaged. Uttrakhand in the third week of June 2013 was stuck by flash floods and landslides.

Responsible Schooling – Doon School Ways By Anil Jaggi When I saw young and motivated students of Doon School trekking remote, isolated and flood affected villages of Silli, Chandrapuri, Vijay Nagar, Simmi, Bhatwari and Sonar villages which are badly damaged due to Uttarakhand Catastrophe, my first impression was that these school students are on routine excursion trips or another group of students interested in disaster tourism. But my perception totally changed once I met Amrit Burret, Head-Social Activity section of prestigious Dehradun based “The Doon School”. The basic philosophy and vision of Doon school is very different from day one when it was founded in 1935. Focus of the school is not only on academics or result but overall personality development of a child with direct touch of humanity, said Amrit who is involved with community based developmental activities of Doon School for the last eight years. To my surprise, Govt. of India under Ministry of Corporate Affairs has to intervene to bring New Company Bill 2012 to legalize CSR(Corporate Social Responsibility) activities for companies falling under their ambit, there by India becoming first country to make CSR spending mandatory through New Company Bill 2012. As per new Company Bill, now companies have to work/ act responsibly & to show their social & human face, that too under strategic CSR framework. Management Colleges will include CSR & allied topics into their curriculum to train young business managers on CSR and to equip them with better career options. CSR & Competitiveness | September 2013 October 2013

But Doon School is not falling under any legal obligation to get involved to such level of Socially responsible activities. Even they are involving their school students with various challenging tasks like disaster management, waste management, education for street kids, health camps etc. It reminded me the words of a well know educationist CS Lewis, “The task of the modern educator is not to cut down jungles, but to irrigate deserts”. Very True, if our educational institutes become sensitive and more concerned to help inculcate responsible behaviour in the future leaders, we would not need to teach them basics of life at later age. We need to imbibe these values in education, out of classroom at very early age, feels Dr. Peter Mecnlaughlin, Head Master Doon School. With Uttarakhand disaster, the whole school, its management, head master, students were supporting and travelling day and night in most difficult locations of Kedar valley to help the

victims of this nature’s fury. School team under Phillip Burret, Wing Commander Anupma Joshi and Amrit Burrett was also helping local NGOs, GOs, CSOs by donating books, school furniture, installing ropeways. Team of doctors, under Dr. Amar Lanka and Shivraj Negi of the School, was busy in running health checkup camps with free distribution of medicines in affected villages. We cannot make every child a doctor or an engineer in their life but yes, we are trying to make all students of Doon School a responsible citizenry said P. K. Nair, assistant head master of Doon School. The school, which can boast of alumni base including Late Sh. Rajiv Gandhi, Late Sanjay Gandhi, Pranab Rai of NDTC, Sh. Bunkar Rai, Vikram Seth famous writer/author, Kamal Nath, Mani Shankar Iyer, remains humble in its approach and is a learner centric school. Our country and the society at large are facing many challenges today. It becomes important for our schools and policy makers to make such socially responsible activities a part of the curriculum, give the students right values at right age and undertake field/social activities as being practiced in Doon School. Our universities should also encourage such schools, institutions and their students by giving them extra weightage in admission like universities in the western countries are offering. This would definitely boost the morale of the students and steer them to the good of the society. Author is the Executive Editor, CSR & COMPETITIVENESS. He can be reached at anil@indiacsr.in

Awards

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Ford Wins Twin Honours of Highest Blood Donor in Industrial, IT Segments CSR & Competitiveness NEW DELHI : The Red Cross Society, Tamil Nadu has recognized Ford in India’s exemplary contributions, awarding the organisation for being the ‘Highest Voluntary Blood Donor in the Industrial Segment’ and the ‘Highest Voluntary Blood Donor in the Information Technology (IT) Segment’ for the year 201112. This is the 13th consecutive year that Ford India has won this honour.

Ford India has held a total of 55 blood donation camps since 2000, resulting in a contribution of 9,688 units of blood.

Joginder Singh, president and managing director, Ford India, accepted the awards on behalf of Ford in India from Dr. K. Rosaiah, Governor of Tamil Nadu, who serves as President of the Indian Red Cross Society, Tamil Nadu Branch. The handover of the trophies took place at a ceremony at the Darbar Hall at Raj Bhavan on October 1, which is observed as World Blood Donor Day. “Ford India has been the highest blood donor in the industrial segment for the 13th consecutive year and it is encouraging to see that our employees show the same passion to help save lives through such efforts, as they do while building Great Products. This year it is humbling to receive the twin honours as the highest blood donorin both the manufacturing and IT segments,” Singh said. In partnership with the Red Cross Society of Chennai, Ford India has held a total of 55 blood donation camps since 2000, resulting in a contribution of 9,688 units of blood. Ford Global Business Services, on the other hand, has organized 20 camps over the

last five years across Chennai, Coimbatore and Gurgaon, donating a total of 2,228 units of blood so far. This year, employees across Ford in India have donated a total of 1,179 units to the Red Cross Society. The company also encourages its suppliers to participate in the life-saving initiative. Ford in India continues to involve, engage and invest further in its communities with the help of its employees, government and non-government organizations under its Operation Better World program. This September, employees across Ford in India also engaged in a variety of humanitarian and community development activities during Ford’s global 8th Annual Global Week of Caring across Ford’s offices in Chennai, Coimbatore, Sanand and Gurgaon. More than 1,700 employees invested more than 10,000 hours of their collective time and worked on more than 30 projects towards building a Better World through the week. On this occasion, Ford’s dealer partners across India also came forward to strengthen the philanthropic community efforts during the week-long activity. In keeping with the true spirit of volunteerism, Ford employees came together to mobilize relief for the victims of the Uttarakhand flood disaster. One of the key highlights of this year’s Global Week of Caring was a donation of Rs. 59, 04, 000, which was made to the Uttarakhand Chief Minister’s Relief Fund. Besides the contributions from Ford and Ford employees, the donation in aid of the flood victims, also includes contributions from Ford’s dealer-partners.

Hindustan Zinc Gives Life of Dignity to Bherulal CSR & Competitiveness “I was a small farmer from Kathia Kheda village of Rajsamand District of Rajasthan, never seen the school. My whole family needed to get engaged in daily labour, working 14-16 hours per day, to ensure twotime meals since my childhood”, says Bherulal Bheel. “But I have been always very ambitious and desirous to become a “Forward Farmer”, Bherulal added. The journey of Bherulal’s success began when his family bought the land from the money they saved working as peasant and he and his brother decided to work together on their farm. Then in April 2011, Bherulal became one of the beneficiaries of “Improved Agriculture-Horticulture and Water Conservation Project” run by Hindustan Zinc in collaboration with BAIF as part of their community service initiatives. Under this project, he along with other farmers was trained on different aspects of modern agriculture technology and systematic farming through demonstration and exposures. His exposure to different forms of seeds, fertilizers, pesticides, insecticides, technical and marketing was helpful in his turn-around. At the time of intervention by Vedanta’s group comCSR & Competitiveness | September 2013 OCtober 2013

pany Hindustan Zinc, the situation of Bherulal was quite critical. His primitive and age old methods of cultivation and harvesting for not yielding good crop. Hindustan Zinc encouraged him for modern techniques and for practicing various areas like improved agriculture techniques, commercial cultivation, organic farming, use of micro nutrients, remedial measures of local disease among crops. The project of Hindustan Zinc was designed to reduce the risk, maximize the land usage and to prevent the dependency on rainfed cultivation. The project had focus towards short and long term farming, low margins to high return and finally making agriculture a steady source of livelihood. Hindustan Zinc exposed Bherulal along with other fellow farmers to KVK Chittorgarh, Mount Abu and Agriculture University, Bikaner, to learn & experience best agriculture practices in horticulture, floriculture and vegetable cultivation etc. After the successful result shown by vegetable cultivation, Hindustan Zinc also helped in construction of a ploy house to grow vegetables when it is usually off season. Gradually he became an example for other farmers of his community to follow. The then Minister of Road Transport and Highways, GOI – Dr. C.P Joshi recognized his contribution during District Level Agriculture Mela. He now optimally utilizes the available water sources through Drip Irrigation System received under the Drip Irrigation Scheme of Agriculture Department of Rajasthan. Due to this project Bherulal who earned Rs. 80,000 per year now is aiming to earn Rs. 2.5 lacs within a year.

Success Story

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450 Tribal Rural Women Crafting Lives in Gujarat Living in an arid region that is drought-prone and where livelihood opportunities are hard to come by, Ramiben’s life has not been very easy. But she knew her craft – something that came down generations from mothers to daughters – would come to her rescue. In the Okhamandal Taluka (Vilalge) of Gujarat from where Ramiben hails is more dependent on other skills as agricultural dependence is low. This region of Gujarat has nourished various tribal cultures since the earliest periods of history, and it is the women from these cultures who have helped relieve the monotony of the region’s stark arid landscapes with their colourful handicrafts.

Okhai – Handcrafting success, empowering the 450 women in the deep rural area of Gujarat CSR & Competitiveness Ramiben’s day begins at the crack of dawn. Quickly completing her household tasks, she marches towards Mithapur where she joins a team of 10 members at the Okhai centre who contribute their skills towards product designing and development of artistic handicrafts.

Project Okhai, a Tata Chemicals Ltd (TCL) initiative under its Corporate Social Responsibility has not just generated livelihood; it has also empowered women in Mithapur, West Gujarat – 150 Kilometers from Jamnagar, on the Arabian Sea where the company’s salt production facility is located.

CSR & Competitiveness | October 2013

She says, my husband takes care of our household expenses, my income from Okhai goes towards the education of my children. This has also been a great opportunity for me to become more aware of the world since i participate in exhibitions and visit other big cities. Laxmiben says, Okhai has helped me change from a manual labourer to an artisan. Whatever I learnt from copying my mother and cutting paper is now better utilised to give income for other women from my community. Okhai has also helped me build a home, which would not have been possible on our own. Ramiben joined the Tata Chemicals Society for Rural Development (TCSRD) Self Help Group (SHG) at Okhaiand was trained to make applique patterns, marketed under the brand name of ‘Okhai’. It was the money earned from Okhai which saw the household through in difficult days. Ramiben has been actively contributing towards product development by introducing new designs. Earning an income of approx. Rs. 5000 per month, Ramiben has build her own house. She took a loan of Rs. 50,000 from her Self Help

Group. With the income from Okhai, she plans to repay the loan. The illimitable energy levels of Ramiben is reflected in the way she motivates the participants with her great wit, which was always accompanied by a message. Her wit is seen in the stage show she and her team put up during the annual Okhai Day Celebrations, held at Mithapur every year on October 15th. On her positive attitude towards work has made her a brand ambassador of Okhai in the villages of Okhamandal. Laxmiben too, exudes the same confidence. She speaks fluent Hindi and even travels to other parts of India for Okhai-related work. She has been associated with the project for seven years now. As master trainer, she trains all the women who join the Okhai programme. She does most of the design cutting and that too without a stencil. Whether it is a flower, tree or an animal, she just picks up the scissors and cuts them effortlessly. Known for her nimble fingers and flawless cuts, she can cut out ten different designs in a day. She lives in Arambhda village and is now a regular member of OKHAI, earning a fixed amount of Rs. 5000 per month of which she saves some amount every month and rest is spent on the education of her four children and the repayment of the loan she took from her SHG to build a ‘pucca’ house. Handicrafts have been identified as a promising means of generating livelihood for hundreds of women of this drought prone area. Okhamandal taluka (village) is home to 200 SHGs of men

Success Story

and women. These SHGs mainly comprise Rabaris, Vaghadis and Ahirs. It is from these communities that the appliqué handicraft under the Okhai brand name has been created with the support and guidance of TCSRD. Okhai provides these families with an alternative source of income. At present, hundreds of women are benefiting from this programme. Mirror work, patchwork, embroidery and appliqué work are all a vibrant expression of their way of life, their rituals and their legends. The handicrafts workforce is guided by a full-time designer to apply the traditional products into those that are in tandem with the current fashion trends. These products are sold at retail showrooms in Mithapur and Ahmedabad. The products are an amalgamation of the traditional art form of the tribal women and contemporary works of the designer. “Okhai centre for empowerment is playing a pioneering role in empowering rural women artisans by helping them improve their economic status. They not only supplement their household income through Okhai, but also help in preserving the rich traditional handicrafts of the region. Okhai has made a significant difference in many of the women’s households by helping the education of their children and improving the quality of their lives. Okhai is going from strength to strength, reaching out to new buyers in new cities, bringing the wonderful rich tradition into homes of many people across the country”, Ms. Alka Talwar, head of community development at Tata Chemicals said. The project began with the formation of SHGs wherein women paid an annual fee of Rs. 25 to become a member. The process continues till today. Every woman who joins the SHG goes through a screening process and takes a skill-based patch test. Based on the grades they get in the test, the requisite training is given to them. Each member also receives a card with a code number. This card records the details of all the work done by them, which helps in deciding each woman’s share in the profits when they are earned. With a focus on quality in the finished product, a group of approx. 40 women have been trained at National Institute of Fashion Technology (NIFT) for better finishing and cuts. The women are being regularly trained in teamwork, quality issues, marketing basics and costing parameters. TCSRD also conducts workshops for women CSR & Competitiveness | September 2013 October 2013

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to have a first-hand understanding of how to work as an industry. Okhai was registered as a separate trust in the year 2008. Tata Chemicals set up the TCSRD in the year 1980 to promote its social objectives for communities in and around Mithapur, where its facility is located. This service was further extended to the communities in and around its Babrala and Haldia facilities. The society works to protect and nurture the rural populations in and around Tata Chemicals facilities, and helps people achieve self-sufficiency in natural resource management, livelihood support and the building of health and education infrastructure. The Okhai products are sold through the handicrafts centre at Mithapur, the Okhai shop in Ahmedabad and several other consignees in Kolkata, Chennai, Pune, Mumbai, Bangalore etc. Okhai also holds sale-cum exhibitions in corporate offices from time to time to promote the brand. These shows have drawn appreciative customers at Tata Technologies, TCS and Tech Mahindra in the past. The products are also now available online on the Okhai website. The exclusive apparel, accessories and furnishings from Okhai, in lively and unique designs, catch the fancy of an urban consumer immediately. The project, thus, has the potential to grow enormously and with support and planning from TCSRD, Okhai is sure to touch and brighten the lives of thousands of women from Okhamandal,as well as the millions who’ve never been there. Tata Chemicals realised the need for women empowerment at the grass-root level and has been continuously facilitating them with various initiatives for the development of self, family and society. With Okhai, the company has been successful in making a remarkable difference in the lives of rural women. It has not only helped these rural women earn better livelihoods, but has also spread awareness about the traditional crafts of the region, thus helping preserve a rich part of the national cultural heritage for generations to come. The Okhai brand is a powerful statement by the women of the Okhamandal Villages, a statement that empowers them, a statement that gives them and this region an identity, a statement that not only makes people notice this beautiful form of art but also appreciate and patronize it.

Okhai project began in 2002, with the target of helping 200 women in the first leg. Today, there are 450 rural women benefiting from this programme, where in they earn an average monthly income of Rs.700. At present, the project is at break-even point, and once it starts making profits, it will be passed on to the women. The craft products are an amalgamation of the traditional art form of the tribal women and contemporary works of the designer. Basic raw material for making crafts is cotton. The fabric is usually handblock printed with vegetable dyes. The women are also attempting working on other fabrics like linen, silk etc.

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Lesson from International CSR Best Practices in an Indian Context Indian corporates have to deal with the common fear of repercussions from disclosing information, including the negative impacts of their activities or unmet targets. It takes a courageous leader to acknowledge negative impacts of its business operations, however it will be rewarded by stakeholder trust and great credibility. By Natalia Rajewska

glect the increasing role of civil society demanding for greater transparency with regards to Corporate Responsibility towards society in India.

Although CSR in India is not a new concept, chequebook philanthropy unrelated to the business, which is often perceived as ‘corporate karma’, is still common practice. In light of the changing legal landscape, a ‘modern corporate karma revolution’ is taking place, which is marked by a shift away from viewing ‘CSR as a liability’ and towards ‘CSR as an investment’. In this crucial shift, it is important for Indian companies to learn from international CSR best practices, which can offer benchmarks worthy of consideration for corporates in their own CSR investment strategies. Spanning from embedded CSR to sustainability reporting, there is a comprehensive arsenal of international tactics, which India Inc. can potentially rely on. The recently passed New Companies Act appears to advocate for a philanthropic approach to CSR. In most cases, CSR, when limited to mere check writing to NGOs, hardly reaches its full potential and effectiveness. This will, in turn, lead not only to lessened social and environmental improvement, but also minimal benefits for the company itself.

Transparency is not just a publicfacing practice. It includes adding depth and balance to corporate communications, disclosing what is relevant and material, focusing on quantitative, applicable and reliable data. Becoming more transparent will lead to greater employee commitment and stakeholder involvement. Moreover, a culture of transparency can help companies gain consumer trust and create a positive brand image. Open and sincere reporting also helps to minimise reputational risks the in case of a crisis.

Indian corporates have to deal with the common fear of repercussions from disclosing information, including the negative impacts of their activities or unmet targets. It takes a courageous leader to acknowledge negative impacts of its business operations, however it will be rewarded by stakeholder trust and great credibility. This can be proven by BP, which created the award winning Sustainability Review after its spill catastrophe in the Gulf of Mexico, not only recognising the disaster, but also detailing the company’s efforts towards restoration of the environment and contribution to the impacted gulf communities.

It is thus preferable for companies opting to start with a philanthropic mind-set to, as a minimum, work with a planned and structured approach, by making donation to causes which are relevant to their core business. After the reputational damages suffered from the recent financial crisis, Goldman Sachs, the leading global investment-banking firm, decided to revamp its CSR commitment by establishing a philanthropic program called ‘10,000 Small Businesses’. The program meets the needs of small business owners from underserved and disadvantaged urban communities, by providing training tools and relationships for the purpose of helping them grow their businesses, with an added emphasis on female owners. Similarly, Wal-Mart, the giant retail corporation, decided to act upon one of the negative externalities of the financial turmoil in the US: the increased incidence of poor Americans experiencing hunger. The company chose a structured approach, focusing on raising awareness of the issue of hunger and donating money and food to a network of food banks in order to ‘Fight Hunger Together’ in the local communities in which the company operates. These examples demonstrate how companies can donate not just their capital, but also their business expertise, concentrating on issues related to their core business. Companies can enhance their brand image and reputation as good corporate citizens by embracing embedded CSR and incorporating it at all levels. Simply by supporting initiatives and charities that mirror their own business philosophy, they could see unprecedented growth in a wide number of areas. Be it in customer loyalty, sales and the ability to attract and retain staff, reducing costs and risks and addressing stakeholder concerns in the communities in which corporates operate.

The Strategic Advantage of Transparency The success of CSR investments depends on a company’s transparency and consideration for the stakeholders’ will and expectations. Firstly, with the New Companies Act, resulting in the government more closely monitoring CSR efforts, there will be a demand for greater transparency. Subsequently, we cannot ne-

CSR & Competitiveness | October 2013

Transparency is not just a public-facing practice. It includes adding depth and balance to corporate communications, disclosing what is relevant and material, focusing on quantitative, applicable and reliable data. Becoming more transparent will lead to greater employee commitment and stakeholder involvement. Moreover, a culture of transparency can help companies gain consumer trust and create a positive brand image. Open and sincere reporting also helps to minimise reputational risks the in case of a crisis.

Prioritising the real need of the community Considering the trend in India, education (85%) and health (67%) are the most preferred areas of engagement. However, the list of eligible activities specified under the New Companies Act covers more diverse issues. The beneficiaries’ needs and wants may diverge from what companies expect them to be. In order to effectively contribute to their community, corporates should commence with an effective stakeholder engagement strategy comprising of meaningful twoway stakeholder consultations and a comprehensive needs assessment. In addition, it was found that the preference for CSR spending generally goes to urban areas close to the companies’ target markets, meaning that most projects do not reach the most deprived individuals in the rural areas. While still supporting the underprivileged from urban areas, it is crucial to realise the potential for interventions in rural villages, since more than 70% of Indians belong to rural communities.

Smart partnerships As corporates begin to tackle major social challenges in India, healthy multi-sector partnerships are necessary in order to conduct sophisticated needs assessment and implement CSR projects, especially on a bigger scale. However, many partnerships between stakeholders, including private sector, employees, NGOs, communities and the government, can create barriers rather than build bridges. Project duplication, resulting from to a competitive corporate ethos even in CSR, is common practice. Consequently, long-term, strategic partnerships should focus on fostering alliance rather than competition and provide a practical way forward. These so-called ‘social partnerships’ or ‘cross sector partner-

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The Philanthropic Journey of CPSEs - A Paradigm Shift By Rohit Singh India has been able to maintain a decent, if not spectacular, economic growth during a slowdown in the globaleconomy primarily riding on government stimulus packages, which included large social expenditure programmesfocussing on providing infrastructure and subsidies. The thrust was supported by the growth, production, large scale employment and resources made available by the enormous government owned enterprises, known as the Central Public Sector Enterprises (CPSEs). Being the largest commercial enterprises in the country, CPSEs provide a huge leverage to the government (their controlling shareholder) to intervene in the economy directly or indirectly to achieve the desired socio-economic objectives. These PSEs ensure their business decisions disregard the short-term commercial interest to invest in local assets and resources so as to maximise the long-term socio-economic gains. Even the rural growth story, which has recently caught the attention of private sector, could not have been possible without the number of basic infrastructure services offered by public sector in this area. The important indicators to measure the performance of PSES are their share in India’s GDP, in gross domestic capital formation, total employment in PSEs and prices deflator for the sector. In the beginning of the seventies, this share was just 10%, which grew rapidly in the following two decades and more than doubled to 25% by 1990-91. It still accounts for one fifth of the total GDP during FY11.

Giving Trends & Government Guidelines

ships’ can effectively address social issues, allowing corporates to actively contribute their financial resources and know-how and value add to the work done by organisations from public or non-profit sector. Such smart partnerships will be mutually beneficial, simultaneously creating value for the business, organisation and, most importantly, society. It is worth noting that professional, trustworthy NGOs are crucial to the success of CSR investments. Therefore, it is recommended to carefully identify and screen potential NGO partners due to the fact that, despite their good intentions, some NGOs lack the capacity or capability to implement large-scale CSR projects. In addition, many of them may also face transparency issues. In fact, companies often have to struggle with NGOs’ inadequate information disclosure, absence of impact assessment and accountability of funds received. However, corporate partnerships can be mutually beneficial, challenging the traditional thinking of CSR as it happened in the case of the Grameen Group, a leading micro-finance and community development organisation, which has been engaging in several strategic partnerships with global brands like Adidas and Danone, in order to make low-cost products marketed to and by some of the world’s most disadvantaged individuals dramatically improving their livelihood.

Maximising the Impact of a Sustainability Report While only the top 100 listed companies are required by SEBI to include a Business Responsibility Report to their financial disclosure, understanding the importance of communicating CSR efforts is essential for all companies that wish to reap the benefits that CSR can bring to their business. According to Cristiana Peruzzo- Head of CSR at Innovaid Advisory Services, “CSR reporting is in its infancy in the country and many Indian companies still find it challenging to aptly measure and report the impact of their CSR investment. The new legal requirements, especially SEBI’s BRR, will give a tremendous boost to the development of sustainability reporting among Indian companies, as a consequence, increase the quality of CSR projects, due to the fact that they can be open to scrutiny by a much larger audience.” Sustainability Reporting should be an open dialogue, engaging with employees and all stakeholders. Moreover, a valuable sustainability report should ideally follow recognised reporting guidelines such as the one prescribed by SEBI (Securities Exchange Board of India) at the national level and GRI (Global Reporting Initiative) at the international level. Furthermore, in the absence of an accurate communication strategy and professional graphical design, the benefits described above will be difficult to achieve. For instance, Timberland and Vodafone UK set a new bar for CSR reporting with their CSR portals. Their reporting is not limited to uploading static PDF files, but relies on user-friendly online portals (Vodafone calls it: ‘The Responsibility Store’) that allow viewers to click on different areas presenting Vodafone’s CSR impact. It’s accessible, readable and appealing. Since a company has already invested in CSR initiatives, it would be a lost opportunity not to leverage those efforts, by communicating a company’s good work to improve the relationship with the outside world. It is a very exciting time for Indian companies who are faced with a chance to make their CSR efforts more powerful and become major players in the journey towards a healthier and stronger India. Author is a CSR Specialist at Innovaid Advisory Services. She has an academic background in business and international development and is a starting social entrepreneur with broad international experience. Author can be reached at natalia.rajewska@innovaid.co.in CSR & Competitiveness | September 2013 October 2013

Despite the considerable positive impact on the socio-economic landscape of India, the PSEs seldom shy away from investing heavily in community development programmes. The social initiatives of PSEs in the last six decades have considerably uplifted the quality of life of the communities.They’ve worked in remote rural or tribal locations, where most private corporations have seldom thought of or tried reaching. In addition to spending gigantic amount of funds on employee benefits and their skills development, CPSEs have been working towards disbursing the benefits of development among the communities they operate within. These welfare activities include educational support through scholarships; health programs and medical camps; infrastructure development like construction of roads, buildings, and community centres; promotion of sports and games; vocational training and capacity building; building skill development centres; improving access to water, food, health, education and electricity; support for agricultural activities through Kisan Seva Kendras (KSKs); and large-scale tree plantation drives. However, there is much more that is being planned at the national level, to ensure the holistic, long-term and sustainable development of the disadvantaged communities, and to maximize the utilization of the philanthropic rupee. The recent guidelines issued by the Department of Public Enterprises (DPE), Ministry of Heavy Industries and Public Enterprises instruct CPSEs to earmark a certain percentage of their profit after tax for the community development programmes. Talking about the Guidelines, FICCI’s Addl. Director (CSR) Dr. K.K. Upadhyay said, “The recently released DPE guidelines on the CSR shall encourage CPSEs to mainstream CSR into their cores business processes and divert to quality of CSR rather than quantity.This would create intended social, economic and environmental impact, which should in turn help to meet the national goal of inclusive growth.” Focussing on inclusive impact at the grassroots level, the guidelines urge the companies to conduct a baseline survey, to understand the most pressing needs of the target audience, and design a CSR programme accordingly. Another encouraging factor is the approach of DPE, in dovetailing the CSR activities of the CPSEs with the social welfare initiatives of the government, ensuring that the existing structures are empowered, instead of multiple parallel structures being created. In spite of these developments, there are gaps (real or perceived) to be addressed at the grassroots level. In the words of Rusen Kumar, Editor & Director, INDIACSR News Network & CSR & Competitiveness , “Most of the NGOs complain that PSEs are not taking CSR seriously and they are not getting funds from PSEs for their social cause. Public Sector Enterprises are an essential part of the economy and a major driver of socio-economic growth. We should respect the CPSE systems and culture. We must understand their priorities in CSR. Most of NGOs are contacting PSEs to join hands with their own on-going social cause. The support to the existing work of NGO might not fit the CSR agenda of the PSEs. The need is to bring these kinds of issues to the discussion table.”

Support from Expert Implementation Agencies With the combined profit after tax (PAT) of all profit-making CPSEs being more than rupees one lakh crore, the earmarked budget for CSR activities comes to more than rupees 3000 crore. This significant non-lapsable sum, coming into the CSR pool every year, can be most effectively utilized by bridging the gap between CPSEs and the non-profit sector and by streamlining the process of designing, implementing and monitoring large scale CSR programs for CPSEs. Fortunately, such support is available to CPSEs. Expert non-profit agencies, working in the development sector for decades, specialise in providing on-ground expertise and acting as a bridge between these two very diverse sectors. Chief Executive of Charities Aid Foundation (CAF) India, Ms. Meenakshi Batra says, “Wespecialize in designing, implementing, monitoring and reporting large scale CSR programs, undertaken in partnership with companies, foundations and HNIs. With more than a decade long experience of working on the due-diligence of NGOs, CAF India has a strong network of partner NGOs across the country. We offer the perfect set of services to CPSEs, meeting their needs of dovetailing their CSR approach with the guidelines from the Department of Public Enterprises (DPE), and showcasing the positive impact that their work has created within the community.” The prospect of such effective partnerships is a silver lining for India’s growth story. How much it can be leveraged by the stakeholders is yet to be seen. (Author is the Head – Business Development (PSUs & Other Donors) at Charities Aid Foundation India

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Economic and Giving Patterns Close Old Doors for Grassroots NGOs Old routes give way to new opportunities for many By Santanu Mishra

national and international economies. It is imperative that grassroots NGOs recognize these possibilities and diversify their sources of funding accordingly, to strive for their sustainability. They must begin to develop at least some degree of self-sufficiency if they are to have any long-term plans and bring about any lasting change. These NGOs require innovations at the core strategic and organizational levels to sustain their activities. Unexplored avenues need to be discovered with a new mind set and approach.

The growth of the non-profit sector in India, in the last two decades, has been phenomenal. But accelerated development soon reaches a stagnant point if it is not sustainable. As the demand for NGOs is rising in the country, owing to the slow pace of poverty reduction and a backlog of social deprivation; it is combated by a plethora of challenges that have reared their head in the past few years. From relief services to educational initiatives, from healthcare projects to housing organizations, grassroots NGOs work in different spheres that touch the daily lives of marginalized communities across the country. Engaging directly with the people, these NGOs are able to participate in the thought-making process of the communities they work with, and thus have the capacity to bring about positive changes. Realizing this potential, many genuine grassroots NGOs have been doing commendable work with the underserved communities. However, despite this many stand on the verge of shutting down. Their good intentions and hard work are stymied by tough internal obstacles – from unprepared leadership to organisational anomalies, from inadequate resources to an inability to communicate effectively with their target audience. Funding being the blood that pumps life into their operations, resource crunch is one of the biggest challenges faced by grassroots organizations. Resources by NGOs are garnered from various sources – international grant, government schemes, corporate support and individual donation. It is believed that the first of these is the major contributor to the resource pool of the development sector, but this might not be today’s reality. In November 2009, at a forum in New York, Paul Light, a professor of public service at New York University, predicted that ‘at a minimum’ more than 100,000 non-profit organizations would be wiped out in the next couple of years, due to the budget deficits of the American government, what with the nine billion dollar non-profit sector in USA shrinking to a four billion one, in just an year. In 2010, the European Union fell short of its development aid targets by 15 billion Euros, according to a report released by the CONCORD coalition of advocacy organizations. True, the last decade witnessed the growth of many NGOs with support from international organizations and various governments. This period however is already in the receding stage, with most of these countries like the US and UK busy addressing their own economic woes since the economic downturn of 2008-09. Due to weaning political influence, in the face of the rise of the Eastern and Southern resource-rich nations, these countries no longer have the same ability or priority to support NGOs by providing core funding to tackle global sustainability issues. Moreover, owing to the worldwide success of Indian companies and the double digit GDP growth of past years, the global perception about India has changed considerably. India is no longer viewed merely as a developing country, but rather as an emerging market leader. As major donors concentrate more on dealing with countries in states of emergency; India no longer makes it to the priority list. CSR & Competitiveness | October 2013

Around 24 international funding agencies have upgraded India from ‘poor’ or ‘developing’ country to a ‘developed nation’ on the basis of the projections of the Central and State governments. The ground reality however is different. Business growth has been substantial in the country in the recent past being demonstrated by the acquisition of big companies, dependable global footprints in the service sector and empowered human resources. But the wealth being earned has not proportionally contributed to the development ecosystem. The trickling down process is gradual, as has been the case with numerous other countries. Private sector companies, one of the biggest donors in the developed world, are yet to wake up to the phenomenon of charity and philanthropy in India. Indian companies spend less than 1% of their annual profits on such activities against 1.5% to over 2% spent by their UK and the US-based counterparts, says a 2009 study by an international NGO. As such, the grassroots NGOs are left languishing, as resources from both outside and within the country dry up. The society should understand how much community-based nonprofits can achieve, but also how vulnerable they are to any number of economic and policy-related obstacles occurring from the organizational level all the way up to macro variations in

But unfortunately, most grassroots organizations are unable to adapt themselves to prevailing trends in development and in public spending when planning for the future and have thus developed a dependency syndrome towards external aid. Most NGOs have volunteers with good intentions, but poor management expertise. Size, scale and structure are other areas of concern for them. Also, very little is done to support and encourage genuine grassroots initiatives in our country, especially in making them self-sustainable. New generation NGO Smile Foundation, believing in the ability of grassroots NGOs to bring real change in the community, works towards empowering and enabling them, through its national level capacity building programme, Empowering Grassroots. Genuine grassroots NGOs are identified from all over the country and trained to bring excellence, good governance, accountability and sustainability at the community level. Many tailor-made methods on various aspects of capacity building and empowerment such as effective leadership for development & strengthening, 5-C Model of building organizational competencies, involving local support for sustainability, better fund utilization, meeting the expectations of donors, good fundraising practices and effective communication with the stakeholders are deployed as part of the programme. Capacities of 500 grassroots NGOs have been built under Empowering Grassroots in the last two years. The way ahead is not easy. There is no doubt that the international funding will slow down substantially in the coming days. It is always inversely proportional to the relative growth of a country. Innovative planning and building an understanding with the development stakeholders is the way forward for the non-profit sector. Large-scale organizations have already welcomed the birth of social ventures. As the new Companies Act, 2013 comes into force; a step forward has been taken towards encouraging the corporate to share a part of their profits for development. An imperative ally in achieving the developmental objectives, NGOs must realize that the need of the hour is not campaigning against but collaborating with companies—and this hybrid approach is likely to intensify. Grassroots NGOs need to form the key bridge between business, government, and society to be able to stand strong and bring real, sustainable change.

Author is the co-founder and executive trustee, Smile Foundation