Corporate Social Responsibility: A New Way of Doing Business

Prof. V. Thyagarajan
Email : thyagarajan@asiapacific.edu.in

Nancy Dhussa
Email: nancy23kapoor@yahoo.co.in

Abstract

Corporate Social Responsibility initiatives provide businesses the mechanism to

discharge their responsibility towards society. Does it end with the corporate paying taxes

and providing employment or has a wider implication?

Businesses are no longer viewed as only the economic entities but are perceived to be an

inseparable part of the society and management has become a major leadership group in

the industrial society that have a greater responsibility not only towards their profession

but also towards the people they manage and the society and economy in which they

operate. The issue of Corporate Social Responsibility (CSR) is a very dominant theme in

the national as well as global corporate practices. Troubled and costly experiences have

convinced the giants of the industrial world like Shell, Nike, Coca Cola, PepsiCo to

invest heavily in improving their own ethical profile and reputation and hence

performance.

The "triple bottom line" reporting alludes to this new approach where performance is

evaluated along three closely-related lines-economic, social and environmental. Such

an evaluation process posits an organization as a holistic entity in society, in sharp

contrast to its earlier one-dimensional existence as a "profit-making machine". When

applied to the investment decision-making process, the triple bottom line approach is

referred to as "socially responsible investing”.

Corporate Social Responsibility: Scope and Challenges

In the recent years there has been increased pressure on the organizations across the globe

to practice and demonstrate their role for society. The issue of Corporate Social

Responsibility (CSR) is a very dominant theme in the national as well as global corporate

practices. Troubled and costly experiences have convinced the giants of the industrial

world like Shell, Nike, Union Carbide, Coca Cola, PepsiCo to invest heavily in

improving their own ethical profile and reputation and hence performance. Employees

and communities want safe and environmentally sound working practices, Government

wants ethical and responsible organizations and the consumers want safe and cheap

products.

Calls for corporate social responsibility are widespread yet there is no consensus about

what it means. There is a stark contrast between the concepts of corporate social

responsibility and Milton's declaration of the social responsibility of business. Milton and

other liberal economists believe that the only form of responsibility is economic. Those

adapting neo- classical view of the firm advocate that the social responsibility of the

business end with the provision of employment and payment of taxes and extend no

further.

Milton Friedman wrote in New York Times that the social responsibility of business is to

increase profit and any diversion of the company resources to social programmes and

charity represents a tax on consumers and investors and can be viewed as deriving from

an agency problem, that is managers who use corporate resources to further some social

good are doing so only to promote their self image. Freeman argued that firms have

numerous relevant constituents whose interest should be considered because the firm
cannot thrive and survive without the support of these stakeholders, which includes

employee, customers, suppliers and community groups. Hence, social responsibility is a

convincing role management and also the companies are involved in repeated

transactions with these stakeholders and are expected to be honest, trustworthy and

ethical because the returns of such behavior are high.

With the understanding that businesses play a key role for job and wealth creation in

society, CSR is generally understood to be the way a company achieves a balance or

integration of economic, environmental, and, social imperatives. CSR is the way

businesses engage/involve their Shareholders, employees, customers, suppliers,

governments, non-governmental organizations, international organizations and other

stakeholders. CSR is often understood as involving the private sector commitments and

activities that extend beyond the foundation of compliance with laws. CSR is the

business' contribution to sustainable development which can be defined as "development

that meets the needs of the present without compromising the ability of future generations

to meet their own needs”.

World Business Council for Sustainable Development (WBCSD). Ernst and Young

(Australia) view CSR strategy as an approach to create long term organization value

through effective management of risk and opportunity associated with ethical,

environmental and social factors.

Corporate social responsibility is the point of forever growth of various initiative

aimed at ensuring social economic development if the community which would be

livelihood oriented as a whole in a, redible and sustainable manner.

This 'triple bottom line' concept should be employed to measure the performance and

success of business and not just the monetary profits.

It asks organizations to formulate policies and practices to develop employees and

community and maintain environment. It requires corporate to address not only the

financial issues but non-financial concerns such as human rights, business ethics,

environmental policies, community development, and corporate governance as well. "In

reality, notions of ecological responsibility and business responsibility are similar. Both

reject waste and profligacy; both embrace the notion of responsible stewardship and

investment of assets in order to reap greater returns in the long term".

Corporate Social Responsibility: - A New Way of Doing Business

"Corporate Social Responsibility is now a determining factor in consumer and client

choice that companies cannot afford to ignore," says Andrew Grant, Ernst & Young
principal for environment and sustainability services.
"Companies, which fail to maximize the adoption of CSR strategy, will be left behind".
'Nestle believes there is a very strong link between corporate profitability and corporate
social responsibility but only when managed over time is that link apparent.

Progressive corporations know that aligning their business objectives with community

values enhances their economic performance. They understand that it is expected from

businesses to carry out their operations in a responsible manner" both at home and
abroad,

and the customers will be loyal to those who do so. We have to balance our primary

interests as commercial enterprises with the wider interests of the societies of which we

are a part. And, we must realize that our health as a company is very much tied to the

overall well-being of the world around us.

Companies are responsible to their shareholders to produce an adequate rate of return

through activities which are lawful, environmentally sound and morally acceptable. By

fulfilling this responsibility, a corporation can sustain its operations, reward the support

of its shareholders and contribute the maximum possible to society's well being".
There are many examples of how businesses have strategically used CSR as a

competitive tool. The most pertinent example is 'The Body Shop International'.

In 1976, Anita Roddick, founded the globally recognized The Body Shop. With

approximately 2000 stores worldwide and ranked in the top thirty most respected

companies in the world by The Financial Times in 1998, The Body Shop stands as a

business triumph and remains in the top three in International CSR. Its mission statement

reads "dedicate our business to the pursuit of social and environmental change". The

comer stone of the company was to establish a business with ethics. Roddick recognized

what soon became clear to many other corporate leaders, CSR makes good business
sense.

There are clear benefits including: raised profit and company profile through increased

employee and consumer loyalty, strengthened risk management and the creation of a

unique competitive edge. Perhaps the increasing tendency to adopt CSR is motivated by

self-interest, the desire to pursue the many benefits and imitate the success of companies

like The Body Shop.

Many multinational companies have agreed with the ethical theories on social

responsibility and have developed codes of conduct for issues such as child labor, gender

or racial discrimination, promotion of human rights, etc. At Unilever the code of conduct

is performing operations with honesty, integrity and openness with respect for human

rights and interests of their employees.

At ITT Industries, the code of conduct includes provisions on safety and health, equal

opportunity, sexual harassment and other workplace conduct. The code of conduct from

Kellwood Company, an international marketer of camping apparel and other recreational

products, encompasses safety and health, environmental, wages and benefits, child labor,

discrimination, and freedom of association standards. It also requires internal and

external monitoring.
Consumers prefer to purchase goods and services from the companies that are socially

and environmentally responsible. In a survey carried out by Social Market Foundation,

82% of consumers expressed the desire to do so including 23% who would do so even if

the option is more expensive. However, many of them do not have clear and credible

information about the ethical Practices of the companies.

Only 2% of the consumers have enough information to judge the ethical position of the

company while 73% feel that they do not have the access to such information most of the

time. Economist (2000) reported that the concerns over pollution were stronger in many

third world countries as compared to the developed nations.

Respondents in developing countries are far more inclined to avoid products or brand for

environmental reasons, in countries like India, Venezuela, China and Egypt 50-70% of

the respondents appeared willing to pay a 10% premium for a greener cleaning product

while in countries like France, Japan and UK only 20% of the respondents expressed the

willingness to do so.

Commercially successful and socially responsible organizations are viewed as valuing

people more than profits and striving with utmost integrity and honor. Social and ethical

codes act as insurance policy. It is far better to incur the cost of mechanism to ensure

ethical and social practices in an organization than to pay the cost of loss of goodwill or

litigations later. Nike suffered at great loss when it was criticized of employing double

standards in Asian countries and not acting socially responsible when it was revealed that

thousands of Indonesian workers were not getting minimum wage of $72/month.They

were getting only $11-$47 per month which was only 15'Yo of the legal minimum wage,

violating both the Indonesian law and the company's own code of conduct (Education for

Justice, 2006).
Reebok also faced many problems in 2002 when a New York based non-profit

organization Child Labor Watch - published reports on poor working conditions in its six

factories in China. Reebok was earlier accused of employing Child labor for

manufacturing soccer balls in their operations at Sialkot, Pakistan in 1996. Reebok

responded quickly to such reports to ensure people aged below 15 years are not employed

and even stuck a label on its soccer balls which declared 'Guarantee: Manufactured

without child labor'. To further improve its social image the company launched a $ 1

million project called Reebok Educational Assistance to Pakistan (REAP) in mid 1997.

The loss caused by the irresponsible behavior of the business organizations can be very

high and sometimes irreparable. The most apt example is Bhopal Gas Tragedy (1984)

when the leakage of a poisonous gas methyl isocyanate from the pesticide plant of Union

Carbide India Ltd. killed about 10,000 people leaving another 50,000 persons

permanently disabled. Union Carbide neglected the safety measures and was also guilty

of prolonging the misery and suffering of the survivors by withholding medical

information on the chemical and depriving victims of proper medical care. In February

1989, the Supreme Court of India ruled that the company should pay US$ 470 million as

compensation. But can the loss of human life be revoked?

Corporate Social Responsibility: The Business Case

Many managers and companies are concerned about social and environmental problems

but still wonder whether addressing such issues can improve their financial performance.

Demonstrating this linkage is often termed as the business case for corporate social

responsibility. The business case for CSR is compelling. If the ethics fail to persuade you,

the bottom line certainly should. While the traditional arguments for CSR are still

important there is a greater pressure for attention to CSR today. CSR affects a firm's
reputation, risk, ability to attract and retain employees and improves relations with

stakeholders, all of which may affect its profitability.

A study of companies over an 11 year period concluded that 'stakeholder-balanced'

companies showed four times the sales growth and eight times the employment growth as

compared to the companies that focus only on shareholders.

Starbucks emphasizes the business case for CSR as follows:

Consumers are demanding more than '''product'' from their favorite brands. Employees'

are choosing to work for companies with strong values. Shareholders are more inclined to

invest in businesses with outstanding corporate reputations. Quite simply, being socially

responsible is not only the right thing to do; it can distinguish a company from its

industry peers.

CSR moves beyond the damage limitation to sustainable positive advantage by proactive

and sensitive management which may improve business performance. The challenge is to

meet the pressure of public concern over social and environmental issues with an open

two way communication with the stakeholders and using the shared learning for

improvement to turn pressure and damage limitation into a source of business advantage.

Adoption of a CSR strategy can bring the following strategic advantages to

businesses:

Corporate reputation and enhanced Brand image - Good corporate social performance

can build reputation while poor performance can damage brand value. Nike suffered

considerable reputation damage when it was revealed that in one their contracted

factories in Indonesia, 30.2% of the workers had personally experienced, and 56.8% had

observed, verbal abuse. An average of 7.8% of workers reported receiving unwelcome

sexual comments, and 3.3% reported being physically abused. Nike was also accused of

using child labor in 1996 when Naomi Klein in her book "No Logo" points to a photo
showing children in Pakis tan stitching Nike footballs. The company took concerted

efforts to improve the condition and now has 70 staff members working on corporate

responsibility issues.

Royal Dutch/Shell faced European boycott in 1995 over its plan to dump the Brent Spar

oil platform at sea. The reports of environmental harms as the result of its operation in

Nigeria further compounded its problem seeing the fall in sales up to 50%.

For certain companies, like The Body Shop and Van City, CSR is part of their brand

image, which has allowed them to tap into a growing demand for value based products or

services. In the case of Van City, potential depositors ("members") may also see the

credit union's CSR work as a reflection of how they will be treated as clients, thereby

helping expand Van City’s client-base.

Commitments to:
 Early identification of social and environmental issues Open

 Two way dialogues with the stakeholders Shared learning and improvement

 Balancing global standard and local cultural difference.

Pressure and Damage Limitation

 Distraction from the core business

 Reactive changes in business and project plans

 Costs
 Damage of reputation

Business Advantage

 Corporate reputation and enhanced brand

 Image.
 Reduce and manage business risks
  Attract and maintain employees

 Establish or improve reputation with

 Investors, bond agencies and banks
 Access to markets/customers
 Cost savings/improve the bottom line
 Stimulate innovation and generate ideas

 Corporate values: "the right thing to do"

 Meet changing stakeholder expectations

 Expedited permitting/improved relations with.

Reputation is critical to the corporate success. Negative CSR association can have a

detrimental effect on overall product evaluation, while positive association can enhance

product evaluation. A 1999 survey of 25000 consumers in 23 countries found that more

customers form their impression of the company on the basis of corporate citizenship

practices than on brand and financial factors, while 40% had thought about punishing the

Company they believe is not behaving socially responsible. Various studies have

demonstrated a link between reputation and financial performance.

An analysis of "America's most admired companies" found that a good reputation

increases the length of time a firm has earnings above the average and decreases the

length of time the firm has earning below the average financial returns.

Reduce and manage business risks In the increasingly complex market, with greater

stakeholder scrutiny of corporate activities, managing risk is essential to business

success.

Recognizing the power of communities and municipalities, Canadian Pacific Railway

(CPR) has launched a process to reengage communities at the local level to resolve

disputes related to the proximity of residential and commercial neighborhoods to pre-

existing rail lines. This is helping it avoid the intervention of courts and the imposition of

government regulations which can add to the costs of doing business.

Attract and maintain employees there is growing evidence that companies with strong

CSR or sustainability reputations often find it easier to recruit and retain high quality
employees in tight labor markets. Edward Jones was number one in the Fortune 2002 list

of best US Company to work for. Its employees praise the company ethics, 97% citing its

management's honesty. A survey of US Company by Hudson Institute in 2000 concluded

that employees who believe they are working in socially responsible companies are six

times more likely to be loyal than who believe their company is socially irresponsible.

Starbucks' employee turnover is less than a third of the average in the retail food industry.

This is attributed to the company's socially responsible practice. The low turnover also

provides economic efficiencies because of lower costs of staff recruitment and training.

In 1997 Walker Information survey revealed that 42% of the respondents took company's

responsible behavior into account while deciding whether to accept a job.

Examples of companies using CSR as a means of attracting high quality employees

include IBM, Microsoft, General Motors, etc. In contrast companies with a tarnished

image find it difficult to attract the best talent. When a major oil company damaged its

reputation on social grounds, its CEO remarked that its most negative impact was the

fact that bright graduates were no longer attracted to the company.

Establish or improve reputation with investors, bond agencies and banks there is a
growing trend in the Investment community to use Environmental and social
performance factors to evaluate a company's suitability for investment.
If your company will pass any of the accepted CSR audits like AA1000, SA8000 or
Global Reporting Initiative, it has an access to nearly $3 trillion fund held by more than
300 mutual funds that invest only in socially responsible companies.

According to the social investment forum $2.32 trillion or nearly 1/8th of the funds under
professional management in United States was involved in socially responsible investing

in 200. Matthew Kiernan, executive managing director of Innovest Strategic Advisors,

argues this is because "a company's environmental and social performance is an

increasingly potent proxy and leading indicator".

In Built to Last, James Collins and Jerry Porras compared 18 companies with their.

Direct peers and found that one dollar invested in 1926 in 'visionary' companies having

core purpose beyond making money have grown to $6356 by 1990 as compared to $955

in the other group. The Dow Jones sustainability Index (DJGSI, introduced in 1999) and

FTSE4Good (introduced in 2001), list companies that meet socially responsible investing

criteria (Smith 2003). DJGSI consists of top 10% companies in terms of sustainability

performance drawn from 2500 biggest companies in Dow Jones Global Index (DJGI).

The DJGSI companies outperformed DJGI companies by 36.1 % over a five year period

while the energy companies in DJGSI performed 45.3% better than their counterparts.

Access to markets/customers Investment in CSR pays off in improved access to markets,

including customer loyalty, security in existing markets and attractiveness in new

markets.

Governments also tend to favor bidders who demonstrate a commitment to society.

British Telecom (BT) believes that the quality of their CSR performance differentiates

them from their competitors. This is important for a company like BT who bids for major

contracts in both the public and private sectors (worth £1.3 billion in the 2006 financial

year alone) (CSR Business Case, 2006).

A recent study done by Walker Research indicates that when the traditional buying

criteria such as price, quality and convenience are equal, 81 % of the customer would

switch to socially responsible brands.

British Telecom has measured the link between customer satisfaction and CSR for a

number of years and concluded that there exists positive correlation between the two.
Customers who believe that BT takes its responsibility to society and the community

seriously are more than twice as likely as other customers to be very or extremely

satisfied with BT. DuPont Canada believes its programs help develop new market

opportunities for the company. For example, DuPont Canada's public Sustainable Growth

Report has actually brought in new consulting work. Consumers are demanding good

behavior on the part of companies. In a survey done in 1997, U.S. consumers revealed

that they want companies to expand their roles to embrace broader social goals. A survey

carried out by McWilliams (2001) confirmed the rise in consumer sensitivity towards

corporate social performance.

Cost savings/improve the bottom line - Businesses can use CSR to produce direct

benefits for the bottom line. While few studies have been able to conclusively draw a

positive correlation between an integrated approach to CSR and bottom line performance,

there are many examples of business benefits that results from individual program areas

that constitute CSR. CSR generates significant savings in staff retention expenses. It

lowers turnover which results in lower recruitment and training costs.

Recycling, energy saving methods, green building technology, etc., result in considerable

reduction in costs. In a 2002 study of global CEOs by the auditing firm Price water house

Coopers, 70% agreed that CSR is vital for the profitability of a company. A 50-country

study of the CEOs by Environics45 International in the same year showed that 80% of

the CEOs believe that CSR enhances product innovation and profitability.

DuPont Canada, for example, has realized financial benefits through waste and energy

intensity reductions. Syncrude's CEO attributes cost savings of $150-200 million

annually to the success of their loss management programme which addresses

environment, health and safety, resulting in improved efficiencies, reliability and

insurance costs.
Stimulate innovation and generate ideas - By examining their core businesses through the

lens of corporate social responsibility, many companies have found opportunity for

innovation and have developed new business prospects. CSR can support innovation in

several ways. If a firm is perceived as socially responsible, it is likely to encounter less

resistance when introducing new products, technologies, or management practices. A

prime focus of CSR investments is life long learning (LLL), through which firms can

build a more qualified, motivated, and adaptable workforce to bolster their performance

and innovation efforts. Linking the local and global network is an increasingly organized

network of NGOs which scrutinize company's action and transform local events to global

news via the internet.

Most companies cite improved relations with stakeholders as an outcome of their CSR

activities. When stakeholders see that companies are open to hearing their concerns and

working with them to address them, trust is built which is invaluable to resolving

disputes and issues.

Expedited permitting/improved relations with regulators - Companies that demonstrate
they are engaging in CSR practices can develop better relations with regulatory agencies
which can mean less red tape and scrutiny, which help them obtain the required permits
for their operations with fewer hold-ups. Among other things, a good reputation affords
resource companies their social license to operate.
Home Depot notes that its reputation of giving back to communities and of being a good
neighbor has helped the company obtain permits to open new stores, an obvious
advantage for a company that is planning to open 600 new stores over the next three
years. Husky recently expanded into Vermont, USA, a state with a particularly tough
regulatory environment by demonstrating the company's Purpose and Values.

The study provides many evidences that the inclusion of CSR in the core organizational

values provides numerous business advantages and results in better economic'

performance.

The recognition of the importance of Trust is well entrenched in India

Corporates such as the Tata and Birla group companies have led the way in making

corporate social responsibility an intrinsic part of their business plans. These companies

have been intensely involved with social development initiatives in the communities

surrounding their facilities. Jamshedpur, one of the prominent cities in the northeastern

state of Bihar in India is also known as Tata Nagar and stands out at a beacon for other

companies to follow.

The parameters for corporate respect in this survey are wide ranging: Overall quality, top

management leadership, depth of talent, belief in transparency, ethics, social

responsiveness, environmental consciousness.

Survey clearly reveals is that impressive financials are not enough to earn respect…You

were respected not because you were big and powerful, but because you were
transparent,

your stakeholders trusted your policies, your HR guidelines were fair, you were ethical,

and you contributed to society. Transparency and ethics were the most important.

“Respect is the first thing we look for when doing anything,” says N.R. Narayana
Murthy,

Chairman Infosys Technologies, the company that was crowned the Most Respected

Company in the survey this year.

Top Ten Most Respected Companies in India, 2003

1. Infosys Technologies
2. Hindustan Lever
3. Reliance Industries
4. Wipro
5. ICICI Bank
6. Gujarat Co-operative Milk Marketing Federation
7. Dr. Reddy’s Laboratories
8. HDFC
9. ITC
10. Hero Honda

Source: Business world, January 2003 [India’s most respected companies]

Hindustan UniLever Ltd., is another company that has remained in the top three most

respected companies for the past decade, and has topped the chart four times, the

maximum number of times yet for any company “If you have respect, value will follow,”

says Chairman M.S. Banga, reflecting the view from the very top.

Adds Narayanmurthy, “At the end, respect comes to people who do desirable things and

who can be trusted. When you make a statement, people should say, we believe.”

It is no surprise that Narayanmurthy holds J.R.D. Tata in great esteem as an icon. The

first name that comes to any Indian on the subject of CSR is that of the Tata Group.

There has been a long history of CSR in India and the Tatas have been the role models on

this path. Explains the chairman of the Tata Group, Ratan N. Tata, “We do not do it for

propaganda. We do not do it for publicity. We do it for the satisfaction of having really

achieved something worthwhile.” The Tata Business Excellence Model integrates social

responsibility into the framework of corporate management wherein social responsibility

is encapsulated as Key Business Process. In fact all social service departments in Tata

companies have annual programmes and budgets… and all this is aligned to the MD’s

Balanced Score Card.

Corporate Social Responsibility programmes at the Tata group of companies extend

across a wide spectrum including rural development, community development and social

welfare, family initiatives, tribal development and water management.

About 7000 villages around Jamshedpur and Orissa benefit from development

programmes run by the Tata Steel Rural Development Society (TSRDS). Programmes

of TSRDS cover issues like education, irrigation, afforestation, adult literacy, vocational

training, handicrafts and rehabilitation of the handicapped persons. The Community

Development and Social Welfare Department (CDSW) at Tata steel carries out medical

and health programmes, blood donation drives, mass screening of Tuberculosis patients

immunization camps and drug de-addiction. In 1999, Tata Steel embarked on an AIDS

awareness programme, which has now become an integral part of all training

programmes. Routine activities like immunization programmes, sterilization operations

and mother and child health care programmes are conducted through 9 family welfare

centres, 9 child clinics and 6 community-based clinics. In fact, Tata Steel’s Centre for

Family Initiatives (CFI) was successful in influencing 59 per cent of Jamshedpur’s

eligible couples practicing family planning, compared to the national figure of 35 per
cent.

A commitment to the welfare of the community has long been central to the value system

of companies in the Tata Group. To build upon this heritage the Tata Council for

Community Initiatives (TCCI) has created the Tata Guidelines on Community

Development, an effort of over three years from the field evolved into a framework of

best practices.

The Birla group of companies are also among the pioneers in the field of corporate

social responsibility in India. As part of the Aditya Vikram Birla Group’s Social Reach,

the Birla group runs as many as 15 hospitals in India; includes Adult education and
schools conducting as many as 78 schools all over India; rehabilitates Handicapped

persons having touched more than 5000 physically challenged individuals. More than

1,00,000 patients have been examined under the Group’s medical programmes. Over

15,000 children along with 2000 pregnant women have been immunized, over 500

cataract patients operated, 2000 TB patients provided medical care, 100 leprosy-afflicted

attended to, free of cost.

It also provides Vocational Training, having provided training to over 3000 women and

having distributed over 1400 tool kits in a variety of areas like electrical, auto repair,

electronic equipment maintenance and repair and tailoring. It has adopted several villages

under its Village Infrastructure Development programme and has provided extensive

training to over 10,000 villagers in its Carpet Weaving Center.

Among corporates who have displayed deep commitment to Corporate Social

responsibility over long years is Mahindra & Mahindra. The late Mr. K. C. Mahindra

for promoting education among Indians at all levels established the K. C. Mahindra

Education Trust in 1953. Every year the Trust offers up to 30-40 interest-free loan

scholarships to post-graduate students going abroad for higher studies. The Mahindra

Search for Talent Scholarships is a scheme established in 34 schools in India to enthuse

and reward students who have achieved excellence in their academic pursuits.

Similar commitment to CSR has been displayed by several corporates in India. The list,

which at best can be far from complete, includes Arvind Mills, Escorts, Dabur, Bajaj,

Godrej, Hero Honda, DCM Sriram, Ashok Leyland, Ballarpur Industries, Eicher, Kinetic

Group, Kirloskar, Infosys, Reliance, Ranbaxy, Wipro, each of which has been deeply

committed to their communities engaging in programmes encompassing education,

health,
education, integrated rural development.

Beyond the private sector, corporate players in India’s public sector too have been

actively involved in corporate social responsibility initiatives.

Conclusions
The rapidly growing field of CSR was initially a tactic used by major corporations aiming

to pacify consumers' ethical concerns, with origins in the anti corporate and anti-

globalization protests of the late 1990s.

Today, CSR is epitomized as the voluntary ethical behavior of a company towards

society including shareholders and stake holder’s "holding" human and employee rights,

environmental protection, community involvement, and supplier relations as core values.

The reasons for companies becoming interested in social responsibility are diverse: Risk

protection, market Positioning, recruitment, political-social relationships, etc. A

Conference Bard of Canada poll revealed that 77% of Canadians are most likely to invest

in, 81% to purchase from, and 79% to work for companies they view as socially

responsible. Similar demands have been witnessed in other countries as well. There are

many evidences whereby adopting CSR practices businesses have been able to

turn things around for their good. Amidst the negative publicity, Shell in the mid-90s

witnessed productivity downturn and low employee morale. The company's subsequent

commitment to collaboration and stakeholder responsiveness turned things around. Shell

has observed that new employees coming into the company in recent years match their

ideal profile much more closely than in past. The Sears experience linking a 5% increase

in revenues with the 5% increase in employee satisfaction substantiates the happy

employee happy customer financial performance connection. Studies have also positively

correlated the' presence of work-life programs and loyalty to the organization. Amex,
Electrolux, and Coke also found that product lines and marketing initiatives linked to

CSR produced above-average returns (Mess, 2003). The link between CSP and CFP is

motivating businesses to become increasingly involved in CSR practices and address the

wide ranging and ever changing demands of the stakeholders.

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