CONCEPT

Corporate

Responsibility
Corporate of Companies’
Social Social towards
Responsibility Society

Responsibility
Why business organizations should
responsible towards society ?
Examples:
Society Coal mining
Cement industries
Air pollution
Water pollution
C Forestation
S .
R .
.
Corporate
.
.
.
The Triple Bottom Line

Social
(PEOPLE)

Environmental Economical
(PLANET) (PROFIT)
 MEANING
• “Corporate social responsibility is a commitment to
improve community well being through discretionary
business practices and contribution of corporate
resources”.
• According to the World Business Council for
Development (1999), “Corporate Social
Responsibility (CSR) is an ongoing obligation by
industry to perform morally and add to fiscal
advancement while improving the value of the life of
the personnel and their families together with that of
local population and society at large.”
Carroll’s Pyramid of CSR
 Models of CSR
1. Ethical Model
– MK Gandhi
– Philanthropically driven activities
– Trusteeship
2. Statist Model
– Jawaharlal Nehru
– State contribution
– Duty of state to collect taxes and distribute to the society
3. Liberal Model
– Milton Friedman
– Responsibility towards shareholders
4. Stakeholder Model
– R. Edward
– Stakeholder
 ADVANTAGES
1. Stronger brand image, recognition, and reputation
2. Increased sales, customer loyalty and market share.
3. Decreased Operating Costs
4. Long run survival of business
5. Increase ability to attract, motivate, and retain
employees
6. Increase appeal to investors and financial analyst
7. Reduced regulatory burden
8. Easier access to funding
9. Contribution to nations Sustainable development
Period
EVOLUTION
Time

1950 1970 1990

1960 1980 In new

millieninum
Development
Stage of

Managerial Business Sustainable

Awareness
Upspring of CSR Scope of CSR Implications outcomes of orientation
of CSR
of CSR CSR of CSR

CSR is an Moral Three Stakehol Financial & Value

obligation perspective concentric der social benefit creation
Prominent point of Views

to follow. (Davis, circles model (McWilliams (Porter &

(Bowen, 1960) (CED, 1971) (Freema & Siegal, Kramer,
1953) n, 2001) 2006)
Socio- Model of 1984 Sustainable
economic CSR Strategic developmen
view (Carrol, management t ( Jamali,
(Fredrick, 1979) (Orlitzky et 2007)
1960) al, 2003 Companies
Act (2013
 Ethics
• Ethics refers to moral principles, sense of right and
wrong, goodness and badness in our actions and
their motives and consequences.
• Ethics can be viewed as:
– Desirable and not desirable
– Set of principles and values
– Guidelines
– Branch of Philosophy

Business Ethics
• Business ethics are applied ethics, it concentrate
on the moral standards as they apply to business
policies, institutions and behaviour.
 Theories of Business Ethics
• Deontological Ethics: (By Immanual kant)
– Duty
– Features of action are the key determinant
• Teleological Ethics
– Consequentialism or consequentialist ethics
– Features of result are the key determinant
• Virtue based Ethics
– It focuses on building a good character and assisting
other in developing good character and removing bad
habits.
– Less emphasis on rules and procedures based on
result or action
 Business Ethics and CSR
• Business ethics and corporate social
responsibility are two equally important
concepts in respect of business.
• Business ethics are moral principles that act as
a framework for the way a company or
business conducts itself and its transactions.
• corporate social responsibility is the concept
that a company should be socially accountable
to itself, its stakeholders, as well as the public.
 Business Ethics Vs CSR
Business Ethics
1. Business ethics mainly
affect the employees,
stakeholders, shareholders,
and consumers or clients
of a company.
2. combination of business
and ethics, which results in
good ethical decision-
making practices in the
workplace
Corporate Social Responsibility
1. Corporate social
responsibility affects the
whole of society.
2. corporate social
responsibility is more
about a company’s
obligations to society.
 CSR PRACTICES IN INDIA
• Earlier companies contribute to CSR activities
voluntarily but on 1st April 2014, the Indian
government makes it legally mandatory for the
very first in the world.

• CSR governs under section 135 of the Companies

(Corporate Social Responsibility) Rule, 2014 and
Schedule 7 includes the list of activities in which a
company can undertake CSR initiatives.
 Continue…
• According to the Companies Act, companies need
to spend 2% of their three years’ average annual
profit as CSR and if they are crossing the
following thresholds:
– Net worth of Rs. 500 crores or more, or
– Turnover of Rs. 1000 crores or more, or
– Net profit of Rs. 5 crores or more,

• In case, a company is failed to comply with the

spent required amount on CSR then it needs to
specify the reason for it on its website.
 1. Hunger, Poverty, Health & Sanitation
2. Education & Employment
SCHEDULE VII 3. Gender Equality and Women
(Section 135) Empowerment
4. Environment Sustainability, Animal
Welfare and Conservation of Resources
5. Prime Minister’s National Relief Fund and
Activities which other Funds
may be included 6. Promotion of Sports
by companies in
7. Armed Forces
their Corporate
Social 8. Promotion of Art, Culture, Heritage &
Responsibility Infrastructure
Policies Activities 9. Funding of Technology Incubators at
relating to:— Academic Institution
10. Rural Development
11. Slums Development
12. Disaster Management
 REFERENCES

• What is the Difference Between Business Ethics and CSR - Pediaa.Com

• CV Baxi and Ajit Prasad, Corporate Social Responsibility: Concept and
Cases, Exel Books
• Philip Kotler and Nancy Lee, Corporate Social Responsibility: Doing the
Most Good for Your Company and Your Cause, John Wiley & Sons, Inc.,
Hoboken, New Jersey