Topic : Brand Enhancement through CSR in Corporates Group 11 Group Members Shreya Khatri (224) Amruta Padwal (208)

Lalitkumar Gangwar (235) Preeti Suchdev (231) Sanket Suratwale (238) Prashant Kale (197)

Introduction In times where India Inc showing its growth in GDP and the Governments new company bill making mandatory for corporate to earmark part of their profit for corporate social responsibility (CSR) initiatives and inspite of having such life size successful examples of companies like TATA and BIRLA , CSR in India is in a very nascent stage. Though CSR is not new to India, companies like TATA and BIRLA have been imbibing the case for social good in their operations for decades long before CSR become a popular cause. It is still one of the least understood initiatives in the Indian development sector. It is followed by a handful of public companies as dictated by the very basis of their existence, and by a few private companies, with international shareholding as this is the practice followed by them in their respective foreign country. Thus the situation is far from perfect as the emphasis is not on social good but rather on a policy that needs to be implemented. Industrialization and commercialization of service sector have explored vivid avenues of progress to a nation but at the flip side it rooted the use of non-renewable energy sources, global warming, greenhouse gas emissions and rising levels of waste which have pernicious effects to the generation coming next. The growing concerns for sustainable development, environmental performance, encompassing pollution control and stewardship of natural resources gave mass recognition to the concept of Corporate Social Responsibility (CSR). The integration of CSR principles in operating activities of business is very much imperative to ensure sustainable development of an economy. The potential benefits of CSR have generated interest of regulatory authorities, society, NGOs, employees, customers as well as international bodies to the issue. In financial sector several international initiatives like United Nations Environment Programme Finance Initiative, Global Reporting Initiative, Equator Principles and Collavecchio Declaration

on Financial Institutions are underway to ensure the adoption of CSR practices in normal business operations. These initiatives have favorably tuned up developed countries to behave in a socially responsible manner. But in developing nations, there is a dearth of deliberate and effective actions to the current need. In addition to this a very limited research work has been done to investigate the CSR practices in developing and emerging nations. In fact the academic publication on this fiery issue is primarily western centric. Most of the CSR studies conducted so far have been in the context of developed countries such as Western Europe, the USA and Australia and we still know too little about practices in ex-colonial, smaller, and emerging countries. 2 Section 172 of the Companies Act 2006 imposes a duty on directors to promote the success of the company, and in doing so to have regard to: the long-term consequences of any decision; the interests of employees; the need to foster the companys business relationships with suppliers, customers and others; the impact of operations on the community and the environment; and the desirability of the company maintaining a reputation for high standards of business conduct. Economic drivers for corporate social responsibility Drawing on the experiences of those companies that have adopted corporate social responsibility, commentators have identified several ways in which this approach to business decision-making may lead to improved financial performance. The following economic drivers have been identified by the World Economic Forum and Business in the Community as explaining the voluntary adoption of corporate social responsibility by companies across the world (ADL 2003). It is suggested that these drivers do not operate in isolation, and that different companies may have different drivers. Various drivers may also be stronger in different sectors and for A move to adopt corporate social responsibility may arise from a combination of drivers which are as follows: y y y y y y y Employee recruitment, motivation and retention Learning and innovation Reputation management Risk profile and risk management Competitiveness and market positioning Operational efficiency Investor relations and access to capital, License to operate

From the consumer point of view, Brand Image is an important aspect as the customer perceives the brand one buys/likes. A company with CSR activity in its kitty adds value as well as changes the Image. A brand's "extendibility" depends on how strong consumer's associations are to the brand's values and goals.

Literature Review According to the Research conducted by Journal of Ethics it investigated: first, the effects of CSR and corporate reputation on industrial brand equity; second, the effects of CSR, corporate reputation, and brand equity on brand performance; and third, the mediating effects of corporate reputation and industrial brand equity on the relationship between CSR and brand performance. Today Organizations dont rely heavily only on marketing or developing new products but also they undertake various other activities in the form of Corporate Social Responsibility (CSR) which is believed to attract more number of end consumers towards the particular brand and thereby enhancing its brand value. Furthermore, the focus of CSR research has shifted from why to what to how, i.e., to adopt CSR practices most compatible to business strategy to bring about maximum outcomes for both the rm and the society (Basu and Palazzo, 2008). Many studies in consumer markets have also indicated that CSR and corporate reputation induce positive brand perceptions of a corporations products. This research denes CSR as voluntary activities taken by corporations to enhance economic, social, and environmental performance voluntarily. There are various debates on what effect CSR really has on a certain organization. McWilliams (2006) pointed out that CSR should be considered as a form of strategic investment which can be viewed as a form of reputation building or maintenance. On the other hand, Fombrun (2005) proposed enhancing corporate reputation as an extrinsic motivation for companies to engage in CSR activities. Garberg and Fombrun (2006) also drew reputation gain as relevant outcomes of CSR programs. Finally, Bendixen and Abratt (2007) studied a large South African MNCs reputation in supplierbuyer relationships, indicating that the buyers ethical perception about suppliers constitutes the basis of corporate reputation. CSR and corporate reputation arouse customers emotional perceptions about the rms they deal with, leading them to associate their perceptions with the brands they intend to purchase, thus developing brand equity as well as enhancing corporate reputation of suppliers who supply these brands. These in turn result in higher brand performance and also enhances the brand preference towards a product. Corporate social responsibility is not a new concept in India. However, what is new is the shift in focus from making profits to meeting societal challenges. Corporate Social Responsibility in corporate is the continuing commitment by business to behave ethically and contribute to economic development while improving the quality of life of the workforce and their families as well as of the local community and society at large. KPMG made survey which more focus on the companies to discern emerging trends in corporate responsibility reporting. The CSR agenda for most companies include education, health care, HIV/AIDS and community development but there is minimal clarity on how companies decide on such CSR projects. The goal of the study was to provide insight into the

overall Corporate Responsibility (CR) strategies and approaches adopted by the top Indian companies and the CR-related reporting and assurance trends. According to survey conducted by them shows that their reports do not touch upon governance for sustainability and lack focus on CR metrics and performance. Proper rules do not on CR activity. It not only focuses on 1 or 2 companies but also give insights of its CSR activity that they are carrying like 21% of the companies disclose their Green House Gases (GHG) emissions or only 16% of top 100 companies have a CR strategy in place. Nokias CSR can be understood as an entity with four aspects: 1) employees, 2) supply chain, 3) environment, and 4) community. In Research report, CSR is considered very important for Nokias brand and reputation, on the business benefits side important targets include shaping corporate culture, minimizing risk, enhancing efficiency and building company reputation. Transparency and both internal and external communication is considered important to build trust and company reputation. In another report, Bharat Petroleum Corporation Limited has adopted 37 villages as their responsibility to develop in all occupations. It has made efforts to make them self-reliant, provided them fresh drinking water, sanitation facilities, medical facilities, vocational training and literacy camps. In research finding it got that brand enhancing is their second objective but it gives customer satisfaction. BPCL incurring Expenses on CSR activity. CSR is now an integral part of corporate governance for many firms. Given the increasingly important role, which marketing plays in corporate governance. Many companies like The aviation and ICT industries are also under heavy scrutiny by government, industry groups and environmental activists for their carbon footprint. These stakeholders are not generally the target of branding campaigns by these industries; yet, companies like Easyjet and IBM are keenly aware that their CSR records directly affect their brand associations in the minds of consumers. CSR influences corporate branding strategy from a holistic point of view which includes all stakeholders

Research Gap: In the above researches the impact on consumer preference for the product of the Companies involved with CSR activities was not studied. Their preferences whether favorable or unfavorable while selecting products makes an impact on brand image, sales and awareness among consumers Objective: To study the consumer preference for products of companies involved towards CSR