CSR: The conceptual

backdrop
Dr. Mamta Hegde
 Initiatives of corporate social responsibility

CSR initiatives are often broken down into four categories:

environmental, philanthropic, ethical, and economic responsibility.
Environmental initiatives focus on preservation of natural
resources, while philanthropic initiatives focus on donating to
worthy causes that may not relate to a business.

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 Introduction
Corporate governance broadly refers to the rules, processes, or laws by which
businesses are operated, regulated, and controlled.

These functions are, by and large, prescribed by the Companies

Law, governing regulations, and codes of practices.

The process of corporate governance has evolved with the beginning of the
corporatization of business since the 19th century.
https://www.youtube.com/watch?v=ppz3wY5L3uE

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 Introduction

A Typical Corporate Governance Scheme in an Organization

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 Many tend to equate it with an administrative technique, but
corporate governance is a much broader concept; it includes a fair,
ethical, efficient and transparent management that strives to
accomplish certain well-defined objectives—including social and
environmental.
Functional roles of corporate governance
1. Establishing a good and ethical sense of purpose of the business.

2. Structuring the business processes with well-defined objectives to serve shareholders and other stakeholders.

3. Building a spirit of inclusive growth in the society and within the environment of
Operations.

4. Building a partnership with all stakeholders—internal and external.

5. Thinking and acting in the bigger frame of global businesses.

6. Continually sensitizing the organization to global business changes, environment and

Risks..
7. Finally, always keeping to the right side of the law and environmental regulations.

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A Representative Corporate Governance Structure, showing the position of CEO and various
management committees that may advise the Board

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 CODES AND STANDARDS OF CORPORATE
GOVERNANCE

(a) Bring transparency and accountability in the functions and decisions;

(b) Seek to establish accountability standards for the company’s board and
management;
(c) Protect investors’ interests.
(d) Care for other stakeholders; and
(e) Promote investor confidence in the business system

https://www.youtube.com/watch?v=lF2_U9duj6s –Uday Kotak

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 For example, to bring in better corporate governance in listed companies, capital markets
regulator in India, the Security and Exchange Board of India (SEBI) mandated the guidelines
for Board composition of listed companies by amending Clause 49 of the SEBI Act dealing
with Listing Agreement.

Purpose of Corporate Governance Codes

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 TYPES OF CORPORATE SOCIAL
RESPONSIBILITY

Corporate social responsibility is traditionally there are four

categories:
• Environmental
• Philanthropic
• Ethical
• Economic responsibility.

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CSR- The Indian perspective
• India is the first country in the world to make corporate social responsibility (CSR) mandatory,
following an amendment to the Companies Act, 2013 in April 2014. Businesses can invest their profits
in areas such as education, poverty, gender equality, and hunger as part of any CSR compliance.
• The amendment notified in the Companies Act, 2013 requires companies with a net worth of INR 5
billion (US$70 million) or more, or an annual turnover of INR 10 billion (US$140 million) or more, or
net profit of INR 50 million (US$699,125) or more, to spend 2 percent of their average net profits of
three years on
 Role of institutions in CSR

• They have the power to allocate assets and set an agenda that promotes
CSR initiatives.
• They can establish environmental laws, labor laws, and increase the
disclosure requirements of corporations.