Corporate Social Responsibility

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Chatper-1

Introduction

INTRODUCTION

1.1 What is CSR1

The entirety of CSR can be discerned from the three words contained within its title

phrase: ‘corporate,’ ‘social,’ and ‘responsibility.’ Therefore, in broad terms, CSR covers

the responsibilities corporations (or other for-profit organizations) have to the societies

within which they are based and operate.

More specifically, CSR involves a business identifying its stakeholder groups and

incorporating their needs and values within the strategic and day-to-day decision-making

process.

Therefore, a business’ ‘society’ within which it operates, which defines the number of

stakeholders to which the organization has a ‘responsibility,’ may be broad or narrow

depending on the industry in which the firm operates and its perspective.

1.2 Other definitions of CSR:2

The notion of companies looking beyond profits to their role in society is generally

termed corporate social responsibility (CSR)….It refers to a company linking itself with

ethical values, transparency, employee relations, compliance with legal requirements and

overall respect for the communities in which they operate. It goes beyond the occasional

community service action, however, as CSR is a corporate philosophy that drives

strategic decision-making, partner selection, hiring practices and, ultimately, brand

development.

South China Morning Post, 2002

The social responsibility of business encompasses the economic, legal, ethical, and

discretionary expectations that society has of organizations at a given point in time.

Archie B. Carroll, 1979

CSR is about businesses and other organizations going beyond the legal obligations to

manage the impact they have on the environment and society. In particular, this could

1 http://www6.miami.edu/ethics/pdf_files/csr_guide.pdf2 http://www6.miami.edu/ethics/pdf_files/csr_guide.pdf

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include how organizations interact with their employees, suppliers, customers and the

communities in which they operate, as well as the extent they attempt to protect the

environment.

The Institute of Directors, UK, 2002

CSR is a means of analyzing the inter-dependent relationships that exist between

businesses and economic systems, and the communities within which they are based.

CSR is a means of discussing the extent of any obligations a business has to its

immediate society; a way of proposing policy ideas on how those obligations can be met;

as well as a tool by which the benefits to a business for meeting those obligations can be

identified.

1.3 History of Corporate Social Responsibility and Sustainability3

The history of social and environmental concern about business is as old as trade and

business itself. Commercial logging operations for example, together with laws to protect

forests, can both be traced back almost 5,000 years. In Ancient Mesopotamia around

1700 BC, King Hammurabi introduced a code in which builders, innkeepers or farmers

were put to death if their negligence caused the deaths of others, or major inconvenience

to local citizens. In Ancient Rome senators grumbled about the failure of businesses to

contribute sufficient taxes to fund their military campaigns, while in 1622 disgruntled

shareholders in the Dutch East India Company started issuing pamphlets complaining

about management secrecy and “self enrichment”. With industrialisation, the impacts of

business on society and the environment assumed an entirely new dimension. The

“corporate paternalists” of the late nineteenth and early twentieth centuries used some of

their wealth to support philanthropic ventures. By the 1920s discussions about the social

responsibilities of business had evolved into what we can recognise as the beginnings of

the “modern” CSR movement. In 1929, the Dean of Harvard Business School, Wallace

B. Donham, commented within an address delivered at NorthWestern University:

'Business started long centuries before the dawn of history, but business as we now know

it is new - new in its broadening scope, new in its social significance. Business has not

3 http://www.brass.cf.ac.uk/uploads/History_L3.pdf

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learned how to handle these changes, nor does it recognise the magnitude of its

responsibilities for the future of civilisation.'

Almost seventy five years later, these words ring just as true. Although today we face

some novel concerns about the role of business in society, from internet “spam” to

genetically modified foods, many of the issues under discussion are not very different to

those being raised in the 1920s. There is a danger that social and environmental concern

about business is an issue which, like sex, every new generation thinks that it has

discovered. The interactive timelines below provide details of the evolution of the history

of our environment, the history of business corporations, the evolution of the concept of

sustainable development and the history of business law and socially responsible

investment as forces seeking to shape the social and environmental impacts of business.

1.4 The Emerging CSR Model 4

1.5 The Role of Corporate Social Responsibility in Modern Business Development5

There are many factors within general business practices that are altering to ensure that

every person benefits from the continued functioning of the company. Previously many

businesses have subscribed to practices that may have had negative effects on their

stakeholders. This is now changing as the realisation sets in of the true importance of the

4 http://www.iitk.ac.in/infocell/announce/convention/papers/Industrial%20Economics,%20Environment,%20CSR-07-VijayLaxmi%20Iyengar.pdf5

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different stakeholders in any particular business. There are many different manners in

which a company can implement corporate social responsibility measures for the benefit

of all concerned. The manner in which each different company implements the changes

will be dependant on what aspects of the company could be considered as having

produced negative effects.

Corporate Social responsibility can often be confused with corporate charity, but it is a

very different thing. Corporate charity can involve the donation of money and the

provision of opportunities to members of the community and stakeholders. This is very

different to the considerations that a company must abide by to ensure that their actions

fall with the acceptable corporate social responsibility guidelines that have been

established. These can include guidelines that relate to the environmental impact that a

particular action can have or they can relate to the impact that an action can have on the

local community. The guidelines are intended to ensure that any negative effects that an

action could possibly have are eliminated or reduced as far as possible.

The concept of corporate social responsibility is intended to provide each business with a

far greater ability to create sustainable development. This can help to provide ongoing

benefits for the business and its stakeholders, regardless of the size of the business. The

business can become more competitive once it begins to create and follow guidelines to

enforce the concept of corporate social responsibility within the company and its

surrounding community. The greater the sustainability of a business's developments, the

more successful it can become. The attraction of corporate social responsibility for many

businesses is that it can help to increase sustainability without creating negative effects.

The type of business that implements changes to come in line with accepted corporate

social responsibility guidelines will also determine what sort of changes will need to be

made. The size of the investment that will be required to ensure that the business

conforms to acceptable guidelines will also be affected by the type of business it is. The

resources that are expended for this purpose do need to be viewed as an investment rather

than an unnecessary expense since the positive results can more than repay the

investment.

The term corporate social responsibility may seem to be one of the current buzz words in

business, but the concept is one that has been formulated by many people over many

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years. The concept is one that is seen as being important for the continued well-being of

the vast majority of companies and essential for the community that surrounds them. The

importance that is placed on business actions conforming to acceptable corporate social

responsibility standards can ensure that these guidelines are treated with the respect that

they merit.

1.6 Why is CSR important?6

CSR is an important business strategy because, wherever possible, consumers want to

buy products from companies they trust; suppliers want to form business partnerships

with companies they can rely on; employees want to work for companies they respect;

and NGOs, increasingly, want to work together with companies seeking feasible

solutions and innovations in areas of common concern. Satisfying each of these

stakeholder groups allows companies to maximize their commitment to another important

stakeholder group—their investors, who benefit most when the needs of these other

stakeholder groups are being met:

I honestly believe that the winning companies of this century will be those who prove

with their actions that they can be profitable and increase social value—companies that

both do well and do good….Increasingly, shareowners, customers, partners and

employees are going to vote with their feet—rewarding those companies that fuel social

change through business. This is simply the new reality of business—one that we should

and must embrace.

Carly FiorinaChairman and Chief Executive OfficerHewlett Packard Company

The businesses most likely to succeed in the globalizing world will be those best able to

combine the often conflicting interests of its multiple stakeholders, and incorporate a

wider spectrum of opinions and values within the decision-making process and objectives

of the organization Lifestyle brand firms, in particular, need to live the ideals they

convey to their consumers:

The 21st century will be the century of the social sector organization. The more economy,

6 http://www6.miami.edu/ethics/pdf_files/csr_guide.pdf

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money, and information become global, the more community will matter.

Peter F. DruckerFounder of the Drucker Foundation (now the Leader to Leader Institute)

CSR is increasingly crucial to maintaining success in business—by providing a corporate

strategy around which the company can rally, but also by giving meaning and direction to

day-to-day operations.

1.7 The Growing Importance of Corporate Social Responsibility7

Corporate social responsibility (CSR) is the responsibility recognized by the companies

for acting in socially responsible manner. There is no single universally accepted

definition of corporate social responsibility

, it has generally come to mean business decision making linked to ethical values, legal

compliance, and respect for people, community, and environment. CSR accepts a

company to go further than required by law so as to

- treat employees fairly and with respect

- operate with integrity and in an ethical manner in all its business dealings with

customer, suppliers, lenders, and others

- respect human rights

- sustain the environment for future generations

- be a responsible neighbor in the community and a good ‘corporate citizen’.

Occupational welfare and corporate community welfare or corporate social responsibility

(CSR) are of growing importance to governments and service providers as they promise

to meet challenges of social problems within changing welfare environments. The

modern governments have increasingly resorted to corporate involvement in local

services and have also encouraged the expansion of occupational welfare. Despite its

growing importance CSR remains an under researched area even as business

organizations have faced new demands for increasing levels of occupational provision

and involvement in local partnerships

with public services.

7http://hubpages.com/hub/The-Growing-Importance-of-Corporate-Social-Responsibility

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Over the last twenty years an increasingly large number of business houses have

responded positively to the banner of CSR. This has perhaps been partly due to their

aspiration to make their operations more ethical. While for the government, the role the

businesses can play in the development of society is quite crucial, the activist community

might like to take credit for the growing importance of CSR as a clear victory for their

efforts in pressurizing the activities of companies. To put the same in other words,

companies introduced CSR reports and programs as a response against damage inflicted

on their sale and reputation by attacks from activist groups who aided by 24 hour news

media in which corporate wrongdoing has been especially highlighted. While on the one

hand this makes a compelling news, it puts an ethical pressure on the companies to give

back at least a part to society in return what they have gained from it. It is therefore, no

longer important for companies to just make profit, the way this profit is generated is

deeply investigated by the activists. A company must not be seen violating ethics or law

in any of the areas like market behavior, trade policies, employment relations, sourcing of

raw materials

, human rights, environmental laws or the activists would put pressure on them through

media or the other channels. This analysis however fails to appreciate much of the social

contributions businesses have been making since long back. We have the example of

Joseph Rowntree and others and the way they developed their workforces. In 1980s, a

network of companies came together to establish Business in the Community (BITC).

Later, they launched Per Cent Club whose members donate 1 percent of pre-tax profits to

the community. BITC is a very widely acknowledged and influential force within

business and in CSR arena.

A set of indicators for the companies wanting to measure and report CSR has been

developed by the BITC. The Indicators that Count addresses four impact areas:

workplace, market place, environment and community. The indicators have been classed

into two groups. The core indicators consist of 27 basic indicators on which all the

companies are expected to report. The six advanced indicators are judged more difficult

to measure. The other group, made up of 17 specific indicators, may not be relevant to all

companies.

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There are also specific projects for the measurement and reporting of particular aspects of

responsible business, as for example, Human Capital and Disability. Human capital

management and disability will have growing importance in CSR reporting. In the UK,

Accounting For People Taskforce has proposed a reporting framework for human capital

management (HCM). This taskforce, appointed by the UK government was represented

by Denise Kingsmill as chairman, and a number of other business leaders. According to

the Taskforce report, even as people typically account for up to 65 percent of a

company’s costs, there has been, however, little reporting on how companies develop

their people.

The companies may either include CSR report in their annual report and accounts or may

publish their separate corporate responsibility report which may be called a ‘social and

environmental report’ or a ‘sustainability report’. These reports indicate a company’s

commitment toward ethical behaviour and highlight their progress towards achieving

their strategic CSR objectives.

Increasingly more and more companies have begun to incorporate ethics and CSR in their

strategic planning and objectives. Many large companies have adopted formal

environmental policies with the objectives of creating a sustainable business and being

environment friendly. For instance, a company that uses large quantities of timber as raw

material might adopt a policy of re-forestation to replace the trees they have cut down.

The growing importance of CSR in context of market and public policies raises a key

issue, that of the legal recognition of CSR benchmarks (labels, certifications, ratings etc.)

and their progressive convergence across the market, that is, a broad consensus on scope

and contents of CSR benchmarks. Since November 2003, several initiatives have taken

place towards CSR convergence on benchmarks, including the EU CSR forum aimed at

facilitating the exchange of experience and good practices in order to establish common

guidelines for CSR tools.

It needs no argument to claim that CSR practices adopted by the companies pay them off

in managing their image. Since the beginning of the 1990s, companies are changing their

business practices under ethical frame work. Consider these examples: Nike and the other

similar footwear and apparel companies are monitoring working condition in their

supplier factories in developing nations; Ikea requires its rug suppliers in India to prohibit

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the employment of children and provide their families with financial assistance to keep

children out of labor market; Starbucks and the other major coffee distributors and

retailers sell coffee bearing their ‘Fair Trade’ label; Home Depot and the other major

retailers of wood products no longer sells products

harvested from old growth or endangered forests; British Petroleum and several other

major firms in United States and Europe have significantly reduced its green house gas

emission; Shell and the other major extractive firms have adopted policies to address

human rights and environmental abuses associated with its investments in developing

countries; Timberland allows its employees to take one week off with pay each year to

work with local charities; PepsiCo along with more than a dozen oil companies and

consumer goods manufacturers have withdrawn investments from Burma because of

human rights concerns; Citibank along with other major financial institutions has

developed criteria for assessing the environmental impact of its lending decisions in

developing countries. While these are few cases of CSR, there are many more examples

that cannot be included here for lack of space.

CSR is becoming an increasingly important component in public affairs program. That’s

because of a number of reasons but the primary one is because of a need to maintain a

good reputation and trust among the stakeholders. The government and the political

entities will not want to maintain a relationship with or deal with organizations that do

not treat their stakeholders, especially employees well. The perceptions of poor CSR may

have their attendant consequences for those organizations that

- do not follow the ‘best practices’ of their competitors or others in their sector. If others

behave better than you then your public affairs activity may suffer;

- have a poor standing in the community;

- have been the target of activist groups

- are being targeted by the media on a regular basis because of their behavior.

It is to be remembered that media provides much of the information to political audiences

and regulators. The other sources of information apart from media on the activities of

organizations include

- friends and families

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- other politicians/regulators

- the views of the electorate/their constituency in the case of MPs;

- the behavior of similar organizations (comparisons);

- activist organizations.

In the days to come CSR will go on to gain further importance for a number of reasons

including the competitive advantage to be garnered by the companies. Even now,

companies in Europe and North America are waking up to the strategic possibilities and

competitive advantages offered by being an environment friendly company. Customers

might be willing to pay more for environment friendliness and for healthy food.

Environment friendly and cheaper automobiles, for instance, have attracted public

attention. In other words, CSR activities can create value addition. Michael Porter has

suggested embedding CSR into corporate and business strategy to create competitive

advantage.

Corporate Social Responsibility is the latest buzz word to which increasingly more and

more companies are getting attentive. Moreover, the governments are keen that

companies take to CSR route as social welfare is becoming both public and private sector

responsibility. The companies too are realizing the hidden costs of failing to meet this

crucial social responsibility that is more ethically and morally binding than legal

necessity. It entails going beyond just the legal responsibilities. There are, however,

issues of labeling and standardization associated with CSR. Nonetheless, it is expected

that a level playing field will emerge as the number of stakeholders will also go on

increasing. Corporate Social Responsibility must be seen by the companies as a

responsibility not imposed by outside forces but guided by conscience and the best

practices of giving back to society, people, communities, and environment what they took

from them. What is even more important, companies have begun to realize the criticality

of CSR as value addition that might offer them competitive advantage in business.

1.8 Why is CSR relevant today?8

8 http://www6.miami.edu/ethics/pdf_files/csr_guide.pdf

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CSR as a strategy is becoming increasingly important for businesses today because of

three identifiable trends:

Changing social expectations

Consumers and society in general expect more from the companies whose products they

buy. This sense has increased in the light of recent corporate scandals, which reduced

public trust of corporations, and reduced public confidence in the ability of regulatory

bodies and organizations to control corporate excess.

Increasing affluence

This is true within developed nations, but also in comparison to developing nations.

Affluent consumers can afford to pick and choose the products they buy. A society in

need of work and inward investment is less likely to enforce strict regulations and

penalize organizations that might take their business and money elsewhere.

Globalization

The growing influence of the media sees any ‘mistakes’ by companies brought

immediately to the attention of the public. In addition, the Internet fuels communication

among like-minded groups and consumers—empowering them to spread their message,

while giving them the means to co-ordinate collective action (i.e. a product boycott).

These three trends combine with the growing importance of brands and brand value to

corporate success (particularly lifestyle brands) to produce a shift in the relationship

between corporation and consumer, in particular, and between corporation and all

stakeholder groups, in general. The result of this mix is that consumers today are better

informed and feel more empowered to put their beliefs into action. From the corporate

point of view, the market parameters within which companies must operate are

increasingly being shaped by bottom-up, grassroots campaigns. NGOs and consumer

activists are feeding, and often driving, this changing relationship between consumer and

company.

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1.9 Corporate Social Responsibility in India9

Indian companies are now expected to discharge their stakeholder responsibilities and

societal obligations, along with their shareholder-wealth maximisation goal.

Nearly all leading corporates in India are involved in corporate social responsibility

(CSR) programmes in areas like education, health, livelihood creation, skill development,

and empowerment of weaker sections of the society. Notable efforts have come from the

Tata Group, Infosys, Bharti Enterprises, ITC Welcome group, Indian Oil Corporation

among others.

The 2010 list of Forbes Asia’s ‘48 Heroes of Philanthropy’ contains four Indians. The

2009 list also featured four Indians. India has been named among the top ten Asian

countries paying increasing importance towards corporate social responsibility (CSR)

disclosure norms. India was ranked fourth in the list, according to social enterprise CSR

Asia's Asian Sustainability Ranking (ASR), released in October 2009.

According to a study undertaken by an industry body in June 2009, which studied the

CSR activities of 300 corporate houses, corporate India has spread its CSR activities

across 20 states and Union territories, with Maharashtra gaining the most from them.

About 36 per cent of the CSR activities are concentrated in the state, followed by about

12 per cent in Gujarat, 10 per cent in Delhi and 9 per cent in Tamil Nadu.

The companies have on an aggregate, identified 26 different themes for their CSR

initiatives. Of these 26 schemes, community welfare tops the list, followed by education,

the environment, health, as well as rural development.

Further, according to a study by financial paper, The Economic Times, donations by

listed companies grew 8 per cent during the fiscal ended March 2009. The study of

disclosures made by companies showed that 760 companies donated US$ 170 million in

FY09, up from US$ 156 million in the year-ago period. As many as 108 companies

donated over US$ 216,199, up 20 per cent over the previous year.

Although corporate India is involved in CSR activities, the central government is

working on a framework for quantifying the CSR initiatives of companies to promote

them further. According to Minister for Corporate Affairs, Mr Salman Khurshid, one of

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the ways to attract companies towards CSR work is to develop a system of CSR credits,

similar to the system of carbon credits which are given to companies for green initiatives.

Moreover, in 2009, the government made it mandatory for all public sector oil companies

to spend 2 per cent of their net profits on corporate social responsibility.

Besides the private sector, the government is also ensuring that the public sector

companies participate actively in CSR initiatives. The Department of Public Enterprises

(DPE) has prepared guidelines for central public sector enterprises to take up important

corporate social responsibility projects to be funded by 2-5 per cent of the company's net

profits.

As per the guidelines, companies with net profit of less than US$ 22.5 million will

earmark 3-5 per cent of profit for CSR, companies with net profit of between US$ 22.5

million - US$ 112.5 million, will utilise 2-3 per cent for CSR activities and companies

with net profit of over US$ 112.5 million will spend 0.5-2 per cent of net profits for CSR.

1.10 CSR Initiatives and Green Measures

India Inc has joined hands to fine-tune all its activities falling under CSR. For this, it has

set up a global platform to showcase all the work done by Indian firms. Confederation of

Indian Industry (CII) and the TVS Group collaborated to form the CII-TVS Centre of

Excellence for Responsive Corporate Citizenship in 2007. It provides consultancy

services and technical assistance on social development and CSR.

According to a National Geographic survey which studied 17,000 consumers in 17

countries, Indians are the most eco-friendly consumers in the world. India topped the

Consumer Greendex, where consumers were asked about energy use and conservation,

transportation choices, food sources, the relative use of green products versus traditional

products, attitudes towards the environment and sustainability and knowledge of

environmental issues.

Reliance Industries and two Tata Group firms—Tata Motors and Tata Steel—are

the country's most admired companies for their corporate social responsibility

initiatives, according to a Nielsen survey released in May 2009.

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As part of its Corporate Service Corps (CSC) programme, IBM has joined hands

with the Tribal Development Department of Gujarat for a development project

aimed at upliftment of tribals in the Sasan area of Gir forest.

The financial services sector is going green in a steady manner. With an eye on

preserving energy, companies have started easing the carbon footprint in their

offices. The year 2009 witnessed initiatives including application of renewable

energy technologies, moving to paperless operations and recognition of

environmental standards. Efforts by companies such as HSBC India, Max New

York Life and Standard Chartered Bank have ensured that the green movement

has kept its momentum by asking their customers to shift to e-statements and e-

receipts.

State-owned Navratna company, Coal India Ltd (CIL) will invest US$ 67.5

million in 2010-11 on social and environmental causes.

Public sector aluminium company NALCO has contributed US$ 3.23 million for

development work in Orissa's Koraput district as part of its Corporate Social

Responsibility (CSR).

1.11 Corporate Social Responsibility in India – Putting Social-Economic

Development on a Fast Track10

Four years ago, Reliance Industries Ltd. launched a countrywide initiative known as

“Project Drishti”, to restore the eye-sights of visually challenged Indians from the

economically weaker sections of the society. This project, started by one of India’s

corporate giants has brightened up the lives of over 5000 people so far.

Corporate Social Responsibility (CSR) defined as “the ethical behavior of a company

towards the society,” manifests itself in the form of such noble programs initiated by for-

profit organizations. CSR has become increasingly prominent in the Indian corporate

scenario because organizations have realized that besides growing their businesses it is

also vital to build trustworthy and sustainable relationships with the community at large.

This is one of the key drivers of CSR programs.

10 http://www.chillibreeze.com/articles_various/CSR-in-India.asp

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Another reason fuelling this rapid adoption of CSR is the state of the Indian society.

Though India is one of the fastest growing economies, socio-economic problems like

poverty, illiteracy, lack of healthcare etc. are still ubiquitous and the government has

limited resources to tackle these challenges. This scenario has opened up several areas for

businesses to contribute towards social development.

CSR is not a new concept in India. Corporates like the Tata Group, the Aditya Birla

Group, and Indian Oil Corporation, to name a few, have been involved in serving the

community ever since their inception. Many other organizations have been doing their

part for the society through donations and charity events.

Today, CSR in India has gone beyond merely charity and donations, and is approached in

a more organized fashion. It has become an integral part of the corporate strategy.

Companies have CSR teams that devise specific policies, strategies and goals for their

CSR programs and set aside budgets to support them.

These programs, in many cases, are based on a clearly defined social philosophy or are

closely aligned with the companies’ business expertise. Employees become the backbone

of these initiatives and volunteer their time and contribute their skills, to implement them.

CSR Programs could range from overall development of a community to supporting

specific causes like education, environment, healthcare etc.

For example, organizations like Bharath Petroleum Corporation Limited, Maruti Suzuki

India Limited, and Hindustan Unilever Limited, adopt villages where they focus on

holistic development. They provide better medical and sanitation facilities, build schools

and houses, and help the villagers become self-reliant by teaching them vocational and

business skills.

On the other hand GlaxoSmithKline Pharmaceuticals’ CSR programs primarily focus on

health and healthy living. They work in tribal villages where they provide medical check-

up and treatment, health camps and health awareness programs. They also provide

money, medicines and equipment to non-profit organizations that work towards

improving health and education in under-served communities.

Many CSR initiatives are executed by corporates in partnership with Non-governmental

organizations (NGOs) who are well versed in working with the local communities and

are experts in tackling specific social problems.

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For example, SAP India in partnership with Hope Foundation, an NGO that works for the

betterment of the poor and the needy throughout India, has been working on short and

long-term rebuilding initiatives for the tsunami victims. Together, they also started The

SAP Labs Center of HOPE in Bangalore, a home for street children, where they provide

food, clothing, shelter, medical care and education.

CSR has come a long way in India. From responsive activities to sustainable initiatives,

corporates have clearly exhibited their ability to make a significant difference in the

society and improve the overall quality of life. In the current social situation in India, it is

difficult for one single entity to bring about change, as the scale is enormous. Corporates

have the expertise, strategic thinking, manpower and money to facilitate extensive social

change. Effective partnerships between corporates, NGOs and the government will place

India’s social development on a faster track.

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Case Studies and Analysis

CASE STUDIES AND ANALYSIS

2.1 ITC11

Envisioning a larger societal purpose has always been a hallmark of ITC. The company

sees no conflict between the twin goals of shareholder value enhancement and societal

value creation. The challenge lies in fashioning a corporate strategy that enables

realisation of these goals in a mutually reinforcing and synergistic manner.

As a corporate citizen with enduring relationships in rural India, ITC has a history of

collaboration with communities and government institutions to enhance farm productivity

and the rural resource base. ITC’s commitments in agricultural R&D and knowledge

sharing have spanned vital aspects of competitiveness – efficient farm practices, soil and

water management.

ITC is committed to a national agenda of raising agricultural productivity and making the

rural economy more socially inclusive. ITC believes that the urgency and scale of these

tasks make market linked solutions and innovations more effective and sustainable than

capital intensive approaches.

In 2000, harnessing the empowering force of information technology and its scalabilty,

ITC launched e-Choupal – a knowledge portal providing farmers with a range of

information and services. Designed to enable them to bargain collectively and enhance

their transactive power, e-Choupal became the much needed and easily adoptable tool

farmers had been waiting for. Today e-Choupal is a vibrant and rapidly growing zone of

business and interaction for over 4 million farmers.

ITC moved rapidly to apply the economic momentum of e-Choupal to solving urgent

social and environmental tasks. ITC launched Mission Sunehra Kal, a rural capacity

building programme fostering local initiatives to develop water and forest resources, open

up new non-farm livelihoods, empower women economically and expand primary

education.

The Mission now embraces a community of thousands of villages that are influential

nuclei of change in rural localities spread over 11 States. A clearly focused self-help

11 http://www.itcportal.com/sustainability/lets-put-india-first/home.aspx

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movement has gained ground in village after village in these areas, with farmers co-

operating to create much needed economic, environmental and social assets out of their

own resources.

By linking knowledge and technology transfer to the creation of economic and social

capacity, ITC has brought a new dynamic to rural development.

ITC has consciously chosen the path less travelled. A path that has led it to create

sustainable livelihoods for 5 million people. For ITC this is an expression of a

commitment beyond the market. Of a conviction that country must come before

corporation. Of a true pride in being Citizen First.

Milestones

e - Choupal4 million farmers empowered,

6,500 e - Choupals installed

Social & Farm

Forestry

107,521 hectares greened,

generating 48.38 million person - days of

employment

Watershed

Development

54,615 hectares

brought under soil and moisture conservation

Women's

Empowerment

14,278 women members

1035 self - help groups

Livestock

Development

164 Cattle Development Centres

2300 villages covered annually

Primary Education228,872 children covered

through 2380 Supplementary Learning Centres

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E-Choupal12

Before ITC introduced us to e-Choupal, we were

restricted to selling our produce in the local mandi. We

had to go through middlemen and prices were low. ITC

trained me to manage the Internet kiosk and I became

the e-Choupal Sanchalak in my village. Today we are a

community of e-farmers with access to daily prices of a

variety of crops in India and abroad – this helps us to

get the best price. We can also find out about many

other important things – weather forecasts, the latest

farming techniques, crop insurance, etc. e-Choupal has

not only changed the quality of our lives, but our entire

outlook.

e-Choupal Now

States covered 10

Villages covered 40,000

No. of e-Choupals 6,500

Farmers e-empowered 4 million

A powerful illustration of corporate strategy linking business purpose to larger societal

purpose, e-Choupal leverages the Internet to empower small and marginal farmers – who

constitute a majority of the 75% of the population below the poverty line.

12 http://www.itcportal.com/sustainability/lets-put-india-first/echoupal.aspx

21

By providing them with farming know-how and services, timely and relevant weather

information, transparent price discovery and access to wider markets, e-Choupal enabled

economic capacity to proliferate at the base of the rural economy.

Today 4 million farmers use e-Choupal to advantage – bargaining as virtual buyers’ co-

operatives, adopting best practices, matching up to food safety norms. Being linked to

futures markets is helping small farmers to better manage risk. e-Choupal has been

specially cited in the Government of India’s Economic Survey of 2006-07, for its

transformational impact on rural lives.

22

Social & Farm Forestry13

Social & Farm Forestry Now

Area developed ( hectares ) 1,07,521

Saplings planted ( nos.) 451 million

Employment generated ( person-days ) 48.38 million

ITC has helped to bring over 16,400 hectares of wasteland under social forestry

benefiting 19,376 poor households in 480 villages.

ITC’s social forestry programme simultaneously addresses the livelihood problems of

marginal farmers and the ecological imperative of regenerating biomass and nurturing

depleted soils.

In the moisture-stressed districts of Guntur, Nellore, Khammam, Nalgonda and Prakasam

in Andhra Pradesh, marginal wasteland owners, who mostly make a living as farm

labourers, are often out of work for long stretches.

In an innovative move, linking these farmers’ need for income to the wood fibre needs of

its paperboards business, ITC has enabled them to convert their wastelands to pulpwood

plantations – a commercially viable land use alternative that can end their

marginalisation.

Watershed Development14

Watershed Development Now

Water harvesting structures 2,884

Water user groups 1,153

Area under soil & moisture conservation (hectares)

54,615

13 http://www.itcportal.com/sustainability/lets-put-india-first/forestry.aspx

14http://www.itcportal.com/sustainability/lets-put-india-first/watershed-development.aspx

23

Employment generation (person-days) 1,491,030

ITC’s watershed initiatives have led to an improvement in soil and moisture regimes –

there is more land under irrigation, water tables have risen and farmers can harvest more

than one crop, making it possible to live off the land round the year.

Agricultural Development15

Agricultural Development Now

Group irrigation wells 409

Sprinkler units 477

Demonstration plots 4,075

Vermicompost & NADEP units 13,506

ITC offers facilitation to farmers to form agri-business societies, pool knowledge and

resources, improve productivity and quality, and reach out beyond local markets to sell at

better margins.

Women’s Empowerment16

Women’s Empowerment Now

Micro-credit groups 1,035

Women entrepreneurs 29,695

The confidence and skills generated among women by forming credit groups and

managing businesses become assets to their communities.

15 http://www.itcportal.com/sustainability/lets-put-india-first/agricultural-development.aspx

16 http://www.itcportal.com/sustainability/lets-put-india-first/womens-empowerment.aspx

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Livestock Development17

Livestock Development Now

Animal husbandry services 441,297

Beneficiary farmers 126,085

Villages covered (annually) 2,300

The milk marketing co-operatives represent exemplary change in rural enterprise, away

from dependence on agriculture and local markets.

Primary Education18

Primary Education Now

Schools assisted 577

Students covered 228,872

Supplementary Learning Centres 2,380

School going becomes an empowering process for the child and the community. The

awareness of entitlements like education and health grows, along with a sense of the

community’s responsibility.

17 http://www.itcportal.com/sustainability/lets-put-india-first/livestock-development.aspx

18 http://www.itcportal.com/sustainability/lets-put-india-first/primary-education.aspx

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2.2 ONGC CSR POLICY & INITIATIVES19

ONGC Group companies, as responsible Corporate Citizens shall promote

Education

Healthcare

Entrepreneurship in the Community

Support Water Management and Disaster Relief

Stakeholder Participation model

CSR activities to be undertaken based on the “Project” concept.

Identification of stakeholders (society) and intended beneficiaries.

Impact measurement

Benefit / impact for ONGC -leading to increased social bottom line and thus to

Corporate Social Performance

12 identified focus areas:

Education including vocational courses

Health Care

Entrepreneurship (self help & livelihood generation) schemes

Infrastructure support roads, bridges, schools, hospitals in around our operational

areas.

Environment protection, ecological conservation, promotion.

Protection of heritage sites, UNESCO heritage monuments etc.

Promotion of artisans, craftsman, musicians, artists etc. for preservation of

heritage, art & culture.

19 http://www.globalcompactasiapacific.org/india/files/documents/ONGC%20CSR%20Policy%20&%20Initiatives.pdf

26

Women’s empowerment, girl child development, gender sensitive projects.

27

CSR Expenditure

Key CSR initiatives so far :

Chaupal: Revival of primary health centre in Bayanpurvillage, Sonipat,

Haryana utilizing voluntary services of doctors

28

Establishment of MRI / CT scan centers in government hospital-GT Hospital,

Mumbai.

Public Libraries in various towns of Assam.

Brick making machine at Karaikalto facilitate poor villagers to make their own

houses

Him JyotiFoundation, Dehradun for development of infrastructure and support

for 50 under privileged girls every year for eight years

SundarPukhuriMilk Co-operative Society with State Veterinary Department

for supplying milk to consumers at Nazira & Sivasagar, Assam.

Bunkar Vikas Sansthan, Chanderi, MP to restore the dying heritage of

Chanderi Sarees and dress material.

Entrepreneurship

Creation of self help groups

weaving

sewing

handicrafts

dairy

goatrearing

piggery

poultry

Co-operatives for

rickshaws

fishery

Employment to handicapped

29

Rickshaw Bank project

Transfers the ownership of the rickshaws to the under privileged people.

In association with Centre for Rural Development

Successful in Guwahati and launched at Sivasagar & Nazira

2.3 CSR IN TATA MOTORS

CSR in Tata Motors is characterized by the capital building of our stakeholders. While

the individual capacity of our beneficiaries is increased through various activities in the

area of human capital, the welfare of the society and their economic enhancement are

taken care through social and economic capital enhancement respectively. We encourage

the adoption of green practices among the communities we work with by raising

awareness and by providing them with necessary facilities and infrastructure the same.

30

2.4 TATA CONSULTANCY SERVICES LTD.20

TCS Maitree

Maitree was started with an objective of bringing TCS associates and their families closer

and making them feel a part of the TCS extended family. Soon after, with a view to carry

on the TATA tradition of enabling the community, the scope of Maitree was enhanced to

include socially relevant activities and endeavors.

20 http://www.karmayog.org/csr501to1000/csr501to1000_21977.htm

31

Maitree and the TCS Community:

Even while at work, you're never away from life. TCS-Maitree was established with an

intention to strengthen the bond between TCS employees and their families, as well as

provide a platform to encourage hidden aspirations and talents. It lends a deeper and

broader dimension to the work culture at TCS. Over the years, Maitree has become a part

of every TCS employee's life. From cracking quizzes to conquering tall peaks, from

shaking a leg to bending it like Beckham, employees have reveled in the excitement and

fun of all Maitree events. And that's not all. Workshops on theatre, yoga, origami, flower

arrangement, chocolate making, and a host of others have allowed the employees to learn

and know about things they always wanted to. All in all, Maitree provides everyone at

TCS the opportunity to establish relationships that extend beyond work and thereby, help

build bonds that makes work so much more fun.

Maitree - Even beyond the TCS Community:

In addition to working towards bringing our associates and their families closer, Maitree

also strives to enable the development of the society. Our approach to social initiatives

entails being pro-actively involved and working at the root level. Some of the projects we

have undertaken include working with the differently-abled, aiding under-privileged

children across various schools in Mumbai, and helping rural community in Vazapur,

among others. Many programs initiated by Maitree, like employment opportunities for

the differently-abled, HIV/AIDS sensitization, peer education, Green Audits to check the

excess consumption of energy resources have now been accepted as best practices by the

organization.

Advanced Computer Training Centre for visually impaired

TCS pioneered an Advanced Computer Training Center (the first of its kind in India) for

the visually impaired. This center, launched at the MN Banajee Industrial Home for the

Blind at Jogeshwari, Mumbai, offers courses that are in sync with industry requirements,

providing the visually-impaired with life-affirming employment opportunities.

32

TCS-Maitree has pro-actively worked towards providing an inclusive environment for the

differently-abled. With the belief that people with disabilities offer incredible reserves of

untapped potential and an alternative talent pool, TCS-Maitree has recruited more than 30

differently-abled people in various branches of TCS. The following are some of the roles

in which the visually impaired persons are working in TCS:

         Infrastructure Services Management

         BPO processes

         Learning & Development coordinator

         Human Resource Manager

         Global Helpdesk

         Accessibility testing

Rural Development Initiative (at Panvel)

Wazapur (Raigad district of Maharashtra) is a village just off the Mumbai-Pune highway,

near Panvel. In spite of being so close to the city, the village is devoid of even the most

basic infrastructure and amenities. TCS-Maitree has been working at the ground level

over the last three years to bring about development in the village. A sustainable model

has been built to improve education, healthcare, and the environment in the area.

 What started off as a children's education program has today grown into a larger

movement with developmental activities in the areas of water supply, illiteracy, and

women empowerment in addition to the focal point of education. Apart from setting up a

primary and a secondary school, some other highlights of the education initiative are:

Mid-day meal scheme for Balwadi kids

Computer literacy program

A state-of-the-art science lab

Taking up the cause of women empowerment, TCS-Maitree launched the WEP (Women

Empowerment Program) where the women of the village were taught basic arithmetic

and created awareness in health and hygiene. More than 25 women from three villages in

the area have been trained in embroidery, stitching, and other textile craftwork over the

last one year with help from the Women's India Trust. A new Gram Vikas Abhiyaan

Kendra was recently inaugurated to facilitate income generation for the women.

33

TCS-Maitree has also made strides in the area of health, conducting HIV/ AIDS

sensitization sessions as well as health check-up camps for the villagers and school

children.

Thalassaemia Drive

TCS-Maitree is organizing lectures, poster displays, and voluntary blood donation drives

across TCS offices to support those who suffer from Thalassaemia. In a partnership with

Red Cross, TCS embarks on periodic blood-donation drives towards the treatment of

Thalassaemia.

HIV AIDS awareness program

TCS-Maitree initiated TCS’ first steps in the area of HIV/AIDS Sensitization and

Awareness a few years ago. The focus of the initiative is to treat HIV as a social issue, as

against treating it as a solely medical prerogative. Associates across the TCS are

participating in TCS-Maitree's aim to spread awareness and sensitize people about

HIV/AIDS.

The highlights of this initiative are:

Commemorating World AIDS Day

Red Ribbon distribution at all offices

Online Quiz for creating more awareness s

Removing myths and misconceptions through articles

Peer Educator Program - Communicating with associates in their own language, through

their 'peers'

mKrishi is an agro advisory system developed by TCS. It connects

farmers to their own eco-systems through specially developed applications on mobile

phones. The application can support interactive and multimedia content to provide

farmers the required information. In mKrishi, data from a farmer reaches the central

server through a cell phone. Experts access this information on their PC and reply with

34

their advice in the native language using Roman script. mKrishi’s features include:

weather forecasts, pesticide and fertiliser advice, and market information.

2.5 TITAN INDUSTRIES LTD.21

CSR activities:

Social Initiatives  

Corporate Social Responsibility

We believe that Corporate Social Responsibility is not an externalised activity nor is it

only philanthropy. It is an internal process reflecting the soul of the Company.

  Titan's Community Development Policy - Experiencing the joy of sharing.

"Titan's initiatives will improve the quality of life of the communities in which it

operates. Titan will build partnerships for the social development of the communities in

which it operates. Titan will focus on initiatives, which can be sustained by the

communities in which it operates".

  Titan has holistically integrated the CSR process and has programs covering the

following:

Employing the physically challenged.

Women's empowerment. Partnering with self help groups amongst rural women

for outsourcing components, bracelets - the Meadow Project with Myrada.

The Titan school and the Titan Foundation for Education - a primary school

currently enrolling 300 students.

The Titan Scholarship - meant for students in Dharmapuri and Krishnagiri based

on the criteria of academic performance and socio-economic background.

The Titan Township -building a sustainable community in Hosur providing a

home to 1300 residents.

Community Development Forums - Eye care camps, Eye donation initiatives -

Aids Awareness- Programs for the differently abled - No tobacco drive, Children's

programs.

21 http://www.karmayog.org/csr501to1000/csr501to1000_22167.htm

35

Volunteering in Hosur, Corporate Office as wells as Regions.

Partnering with NGOs like CRY, Concern India and Ashraya.

Improving the quality of life for children - the TATA -TCCI -TITAN Bal Bhavan

Children's park project at Cubbon Park , Bangalore .

The community appreciated and recognized us by awarding us:

The Government of Tamil Nadu's award for being the "Largest Employer of the

handicapped". This award was conferred on us in the years 1993 and 1996.

The Mother Teresa award for the best Corporate Citizen in 1998.

The Helen Keller Award in 1999.

FICCI-SEDF award in 2001-02 for Social Responsibility.

The Rotary Club of Bangalore Award for the Corporate Citizenship.

The Mother Teresa, Helen Keller and the Rotary Awards for Corporate

Citizenship.

The PHDCII Award for Good Corporate Citizenship.

Titan and the Environment - ISO 14001 but going beyond Compliance

Titan's products and services have very little or marginal impact on the environment.

Titan adheres to all related legal and statutory requirements. The Company is also

extremely conscious of environmental issues and has been recognized in this regard by

the Hosur Industries Association. The Company's environment control results are

continuously monitored with respect to both TNPCB and International Finance

Corporation (World Bank) norms. The Company has been certified under ISO 14001

EMS standards.

Initiatives taken:

Minimizing the use of cyanides in plating by adopting non-toxic PVD technology.

Eliminating the use of ozone-depleting substances ahead of the Montreal Protocol

deadline.

Minimizing the use of plastic packaging with eco-friendly materials.

36

Adopting Vermi-composting for the conversion of garden / vegetable waste in to

useful manure.

Piloting the study of conversion of industrial waste into useful civil materials.

Promotion of rainwater harvesting at manufacturing locations.

Waste water treatment with efficient effluent treatment and use for industrial

cleaning and gardening.

Recycling brass scraps.

Rainwater harvesting in 3 manufacturing locations.

Results:

Energy consumption per watch reduced by 41%.

Cumulative Energy savings - 26 Lac kwh.

Water consumption per watch down by 47%.

Daily plant water consumption reduced by 28%.

Brass scrap recycling back to process - saving during 2002 - 03 Rs.62 Lacs

Adhering to all Statutory norms. As a culmination of all these initiatives, we

received The Golden Peacock- Environment Management Award 2003 - at the 5th

World Congress on Environment Management.

Titan Industries is a signatory to the Global Compact and is committed to the

implementation of the 10 principles of the Global Compact. Titan Industries is also

guided by the principles of the Global Reporting Initiative.

  There is a process of continuous dialogue and feedback with employees, respective

departments and business partners, to ensure adherence. E.g. Labour standards are

complied with as per the laws of the land and there is no evidence of any employment of

child labour.  

The management of Business Ethics is facilitated by compliance of the Tata Code of

Conduct.

The Company's credo towards CSR:

37

  Social Responsibility-an initiative today, a mandate tomorrow. Bringing a smile to

the community creates customer affection ensuring sustainability.

Corporate Sustainability:

Titan Industries has a clearly defined policy on Corporate Sustainability. The approach of

its policy continues to be at three levels, the first one being at the Group level where it

works closely with the Tata Council for Community Initiatives, the nodal apex body for

facilitating Tata Group initiatives.

At the Company level, key initiatives have been:

Engaged 330 rural women through self help group and provided them

opportunities for various  outsourced activities in manufacturing/assembling of

Watches, Jewellery and Precision Engineered products.

Over 600 needy students in the disciplines of Vocational, Medicine & Engineering

have benefited from Titan Scholarship program.

The Jewellery Division started the concept of Karigar Park by providing

equipment, material and training to Karigars so that they can work directly under

the supervision of the Division and earn money on job-work without any

exploitation. At present there are more than 400 Karigars working on six Parks.

The Company has established a Basic Training Centre to impart technical skills to

youth from lower economic background to make them employable. Currently 96

students are studying in the centre.

At the individual level, Titan volunteers comprising the Community Development Forum

have taken up comprehensive vision care program in and around Hosur with a leading

Super Specialty Eye Hospital in Bangalore . Eye camps are being conducted and an eye

care clinic has been opened in Hosur to cater to the needy and poor.

• Other programs include programs for skill development for rural women, infrastructure

improvement in villages and creating awareness on hygiene and clean environment.

  The Company is proactive in its approach towards the Environment and is compliant

with statutory and regulatory requirements.  The Watch, Jewellery as well as the

38

Precision Engineering Divisions are certified under ISO 14000:2004 Environment

Management System Standards and under ISO 9001:2000, Quality Management Systems

Standards.

Titan Industries is a signatory to the 10 principles of the Global Compact with its

‘Communications on Progress’ (CoP) duly posted on the UN Global Compact website.

Awards and Recognitions:

Titan Industries Ltd was adjudged one of the World’s 50 “Domestic Dynamos” by

Boston Consulting Group in a survey of the top 50 fastest growing domestic companies

countering multi national majors in their respective domestic markets through innovative

products and marketing thus continuing to grow at an accelerated pace despite

international competition.

  The Company also continued to be recognised for its product and retail brands and its

innovations as under:

Won the Top Retailer 2007 Asia Pacifi c - Bronze Award

Won Marico Erehwon Innovations for India Award for the slimmest watch - Titan

Edge

Titan the brand won Images Fashion Award for the ‘Most Admired Brand for the

year 2007-08  for the 7th consecutive year’.

Titan Industries Ltd won the Images Fashion Award for the ‘Retailer of the Year’.

Titan Brand was ranked fi rst amongst the consumer durables category in a survey

by Economic Times.

39

2.6 ADITYA BIRLA22

Our vision

"To actively contribute to the social and economic development of the communities in

which we operate. In so doing, build a better, sustainable way of life for the weaker

sections of society and raise the country's human development index."

— Mrs. Rajashree Birla, Chairperson,

The Aditya Birla Centre for Community Initiatives and Rural Development

Making a difference

Before Corporate Social Responsibility found a place in corporate lexicon, it was already

textured into our Group's value systems. As early as the 1940s, our founding father Shri

G.D Birla espoused the trusteeship concept of management. Simply stated, this entails

that the wealth that one generates and holds is to be held as in a trust for our multiple

stakeholders. With regard to CSR, this means investing part of our profits beyond

business, for the larger good of society.

While carrying forward this philosophy, his grandson, Aditya Birla weaved in the

concept of 'sustainable livelihood', which transcended cheque book philanthropy. In his

view, it was unwise to keep on giving endlessly. Instead, he felt that channelising

resources to ensure that people have the wherewithal to make both ends meet would be

more productive. He would say, "Give a hungry man fish for a day, he will eat it and the

next day, he would be hungry again. Instead if you taught him how to fish, he would be

able to feed himself and his family for a lifetime."

Taking these practices forward, our chairman Mr. Kumar Mangalam Birla

institutionalised the concept of triple bottom line accountability represented by economic

success, environmental responsibility and social commitment. In a holistic way thus, the

interests of all the stakeholders have been textured into our Group's fabric.

22 http://www.adityabirla.com/social_projects/overview.htm

40

The footprint of our social work today spans 2,500 villages in India, reaching out to 6

million people annually. Our community work is a way of telling the people among

whom we operate that We Care.

Our strategy

Our projects are carried out under the aegis of the "Aditya Birla Centre for Community

Initiatives and Rural Development", led by Mrs. Rajashree Birla. The Centre provides the

strategic direction, and the thrust areas for our work ensuring performance management

as well.

Our focus is on the all-round development of the communities around our plants located

mostly in distant rural areas and tribal belts. All our Group companies —- Grasim,

Hindalco, Aditya Birla Nuvo and UltraTech have Rural Development Cells which are the

implementation bodies.

Projects are planned after a participatory need assessment of the communities around the

plants. Each project has a one-year and a three-year rolling plan, with milestones and

measurable targets. The objective is to phase out our presence over a period of time and

hand over the reins of further development to the people. This also enables us to widen

our reach. Along with internal performance assessment mechanisms, our projects are

audited by reputed external agencies, who measure it on qualitative and quantitative

parameters, helping us gauge the effectiveness and providing excellent inputs.

Our partners in development are government bodies, district authorities, village

panchayats and the end beneficiaries — the villagers. The Government has, in their 5-

year plans, special funds earmarked for human development and we recourse to many of

these. At the same time, we network and collaborate with like-minded bilateral and

unilateral agencies to share ideas, draw from each other's experiences, and ensure that

efforts are not duplicated. At another level, this provides a platform for advocacy. Some

of the agencies we have collaborated with are UNFPA, SIFSA, CARE India, Habitat for

Humanity International, Unicef and the World Bank.

41

Our focus areas

Our rural development activities span five key areas and our single-minded goal here is to

help build model villages that can stand on their own feet. Our focus areas are healthcare,

education, sustainable livelihood, infrastructure and espousing social causes.

Education

Balwadis (pre-school)

Adult education

Non-formal education

Continuing education

Scholarships for girls, merit and technical education

Health and family welfare

Mobile clinics - doctors visit once a week

Medical camps - general and issue-based

Health training and awareness

Sanitation - toilets, training, smokeless chullahs, biogas

Safe drinking water

Mother and child health

Reproductive health

Awareness building

Corporate Social Responsibility Policy23

For us in the Aditya Birla Group, reaching out to underserved communities is part of our

DNA. We believe in the trusteeship concept. This entails transcending business interests

and grappling with the “quality of life” challenges that underserved communities face,

and working towards making a meaningful difference to them.

Our vision is – “to actively contribute to the social and economic development of the

communities in which we operate. In so doing build a better, sustainable way of life for

23 http://www.adityabirla.com/social_projects/downloads/csr_policy.pdf

42

the weaker sections of society and raise the country’s human development index”. (Mrs.

Rajashree Birla, Chairperson, Aditya Birla Centre for Community Initiatives and Rural

Development).

Implementation process: Identification of projects

All projects are identified in a participatory manner, in consultation with the community,

literally sitting with them and gauging their basic needs. We recourse to the participatory

rural appraisal mapping process. Subsequently, based on a consensus and in discussion

with the village panchayats, and other influentials, projects are prioritised.

Arising from this the focus areas that have emerged are Education, Health care,

Sustainable livelihood, Infrastructure development, and espousing social causes. All of

our community projects are carried out under the aegis of The Aditya Birla Centre for

Community Initiatives and Rural Development.

In Education, our endeavour is to spark the desire for learning and knowledge at every

stage through • Formal schools • Balwadis for elementary education • Quality primary

education • Aditya Bal Vidya Mandirs • Girl child education • Adult education

programmes.

In Health care our goal is to render quality health care facilities to people living in the

villages and elsewhere through our Hospitals • Primary health care centres • Mother and

Child care projects • Immunisation programmes with a thrust on polio eradication •

Health care for visually impaired, and physically challenged • Preventive health through

awareness programmes.

In Sustainable Livelihood our programmes aim at providing livelihood in a locally

appropriate and environmentally sustainable manner through • Formation of Self Help

Groups for women empowerment • Vocational training through Aditya Birla Rural

Technology Parks • Agriculture development and better farmer focus • Watershed

development • Partnership with Industrial Training Institutes.

In Infrastructure Development we endeavour to set up essential services that form the

foundation of sustainable development through • Basic infrastructure facilities • Housing

facilities • Safe drinking water • Sanitation & hygiene • Renewable sources of energy.

43

To bring about Social Change, we advocate and support • Dowryless marriage • Widow

remarriage • Awareness programmes on anti social issues • De-addiction campaigns and

programmes • Espousing basic moral values.

Activities, setting measurable targets with timeframes and performance

management.

Prior to the commencement of projects, we carry out a baseline study of the villages. The

study encompasses various parameters such as – health indicators, literacy levels,

sustainable livelihood processes, population data – below the poverty line and above the

poverty line, state of infrastructure, among others. From the data generated, a 1-year plan

and a 5-year rolling plan are developed for the holistic and integrated development of the

marginalised. These plans are presented at the Annual Planning and Budgeting meet. All

projects are assessed under the agreed strategy, and are monitored every quarter,

measured against targets and budgets. Wherever necessary, midcourse corrections are

affected.

Organisational mechanism and responsibilities

The Aditya Birla Centre for Community Initiatives and Rural Development provides the

vision under the leadership of its Chairperson, Mrs. Rajashree Birla. This vision

underlines all CSR activities. Every Manufacturing Unit has a CSR Cell. Every Company

has a CSR Head, who reports to the Group Executive President (Communications &

CSR) at the Centre. At the Company, the Business Director takes on the role of the

mentor, while the onus for the successful and time bound implementation of the projects

is on the various Unit Presidents and CSR teams. To measure the impact of the work

done, a social satisfaction survey / audit is carried out by an external agency.

44

Partnerships

Collaborative partnerships are formed with the Government, the District Authorities, the

village panchayats, NGOs and other like-minded stakeholders. This helps widen the

Company’s reach and leverage upon the collective expertise, wisdom and experience that

these partnerships bring to the table.

In collaboration with FICCI, we have set up Aditya Birla CSR Centre for Excellence to

make CSR an integral part of corporate culture.

The Company engages with well established and recognised programmes and national

platforms such as the CII, FICCI, ASSOCHAM to name a few, given their commitment

to inclusive growth.

Budgets

A specific budget is allocated for CSR activities. This budget is project driven.

Information dissemination

The Company’s engagement in this domain is disseminated on its website, annual

reports, its house journals and through the media.

Management Commitment

Our Board of Directors, our Management and all of our employees subscribe to the

philosophy of compassionate care. We believe and act on an ethos of generosity and

compassion, characterised by a willingness to build a society that works for everyone.

This is the cornerstone of our CSR policy.

Our Corporate Social Responsibility policy conforms to the Corporate Social

Responsibility Voluntary Guidelines spelt out by the Ministry of Corporate Affairs,

Government of India in collaboration with FICCI (2009).

45

2.7 MAHINDRA24

Corporate Social Responsibility has always been an integral part of the Mahindra Group's

vision and the cornerstone of our Core Value of Good Corporate Citizenship.

- Keshub Mahindra, Chairman

The Mahindra Group defines Corporate Social Responsibility as making socially

responsible products, engaging in socially responsible employee relations and making a

commitment to the community around it. At the Mahindra Group, Corporate Social

Responsibility is not just a duty; it's a way of life.

In 2005, the Group celebrated its 60th anniversary by renewing its commitment to

Corporate Social Responsibility. It pledged to dedicate 1% of its profit (after tax), on a

continuous basis towards Corporate Social Responsibility. A unique kind of ESOPs -

Employee Social Options was launched to enable Mahindra employees to involve

themselves in socially responsible activities of their choice. The Group also announced a

special gift: to provide free cochlear implants to 60 profoundly hearing-impaired, under-

privileged children.

In addition to giving impetus to the Nanhi Kali project for the girl child and the Mahindra

All India Talent Scholarship for the economically disadvantaged, the Mahindra Group is

planning to set up two Mahindra Pride Schools. These schools will offer a variety of

courses, with an emphasis on employability, including training for Information

Technology, Retail, Automotive Engineering etc. They will provide new skills and

capabilities to the weaker sections of society, particularly the scheduled castes and

scheduled tribe youth. While these projects are already underway, plans for more social

initiatives are on the anvil.

Education

A) K. C. Mahindra Education Trust

Established by the late Mr. K. C. Mahindra in 1953, the K. C. Mahindra Education Trust

aims to ‘Transform the lives of people

24 http://www.karmayog.org/csr501to1000/csr501to1000_20979.htm

46

in India through education, by providing financial assistance and recognition to them,

across age groups and across income strata'. It was registered as a Public Charitable Trust

under the Bombay Public Trusts Act, 1950.

The K.C. Mahindra Education Trust has undertaken a number of education initiatives to

make a difference to the lives of deserving students. The Trust promotes education

mainly by way of scholarships. It has provided more than Rs. 13.80 crores

(approximately US $ 3.0 million) in the form of grants, scholarships and loans. Some of

these scholarships were instituted as far back as the 1950’s, while others were founded

recently. These are funded through an investment portfolio, the main donors of which are

the Mahindra Group of companies.

Encouraging Students -

In its efforts to encourage and motivate students, the K. C. Mahindra Education Trust

has set up the following scholarships:

a. K. C. Mahindra Scholarships for Post-Graduate Studies Abroad Interest-free loan

scholarships for post-graduate studies are awarded to deserving students

interested in pursuing advanced studies overseas.

b. Mahindra Search for Talent Scholarship

This has been set up in 35 schools across the country with an objective to enthuse

and reward excellence in academics.

c. K. C. Mahindra United World College Scholarship

This is offered to deserving students in the age group of 16 -18

Encouraging Teachers

To further encourage teachers, the Trust has set up

- K. C. Mahindra Chair for Nuclear Chemistry at the Institute of Science, Mumbai.

- Dhandevi Mahindra Scholarship Award at Sophia College, Mumbai

- The Trust has also established several awards and scholarships for the academia.

Empowering the Under-privileged

Mahindra All India Talent Scholarship

47

To empower the under-privileged and disadvantaged sections of society, the Trust has

set up the Mahindra All India Talent Schoarship. These are given to students

belonging to lower income group families, to help them pursue job

oriented diploma courses at recognised government polytechnics. Most of the

awardees are girl students, as the Trust is keen on helping girls earn well, to elevate

their standard of living.

Nanhi Kali

Government of India statistics reveal that out of every ten girls who enrol in school in

India, only three complete Standard X. The Nanhi Kali project, launched in 1996 by the

K. C. Mahindra Education Trust, aims to change this by providing quality education to

the disadvantaged girl child. This national girl child sponsorship programme ensures that

every girl child completes her ten years of formal school education in an environment

that would help her to realise her potential to the fullest. Also, various corporates and

individuals can join the Nanhi Kali project by becoming guardian angels to these

disadvantaged girls.

What is most encouraging is that it takes only Rs. 5/- per day to take care of the girl

child’s education and provide her with a life of dignity. The project addresses attitudes

and issues towards girl children by sensitising the teachers, family members and

community on the importance of providing the child with a good education. Sponsors of

Nanhi Kali are provided with a profile of the child (including her photograph), along with

periodic progress reports so that her academic progress can be tracked. The

Nanhi Kali project is currently looking after the education of 30,000 girl children and

intends to reach out to many more in a phased manner.

Recently, the K.C. Mahindra Education Trust entered into a strategic alliance with

Naandi Foundation, a not-for-profit organisation, to jointly manage the Nanhi Kali

project. Naandi Foundation works with 1500 government schools in Andhra Pradesh,

Madhya Pradesh and Chhattisgarh. Through its ‘Ensure Children Learn Programme’,

Naandi Foundation is creating child-friendly school environments that prevent dropouts

and ensure that children learn. The partnership complements the efforts put in by Naandi

48

Foundation in enriching the learning environment, by helping the girl child in the form of

uniforms, textbooks and other learning material.

The Nanhi Kali project is spearheaded by Mr. Keshub Mahindra and Mr. Anand

Mahindra on the K. C. Mahindra Education Trust’s board, and Dr. Anji Reddy, Mr.

Anand Mahindra, Dr. Ishar Judge Ahluwalia, Mr. Ramalinga Raju and Mr. K. S. Raju on

the Naandi Foundation’s board.

B) Mahindra Education Society

As part of its Corporate Social Responsibility activities, the Mahindra Group has

established schools near its factories primarily for children of its employees. At present,

the Group has three schools that impart high standards of education - Mahindra Academy

at Malad in Mumbai, Mahindra Academy in Zaheerabad and a school in Khopoli.The

establishment of these schools has not just benefited their employees but also the

community around these schools. Teachers at these schools are qualified and undergo

regular training as well as attend relevant workshops. Their teaching methodologies are

constantly evaluated and modified when necessary.

C) Mahindra United World College

The striking feature of the United World Colleges is that they embrace the entire world

across all divides of race, history, culture, wealth, religion, economic status and political

belief: they are unique and they are conscious of their responsibilities.

– Nelson Mandela, United World College Honorary President

The Mahindra United World College of India, part of the United World College

movement, was founded by the late Harish Mahindra in 1997. It is the Group’s endeavour

to promote world- class education with an emphasis on the ideals of peace and

understanding, central to the ethos of the United World Colleges. There are 10 United

World Colleges spread across the globe, with colleges situated in United Kingdom,

Singapore, Canada, Swaziland, Italy, United States of America, Venezuela, Hong Kong,

Norway and India. Her Majesty Queen Noor of the Hashemite Kingdom of Jordan is the

President of the United World Colleges and Mr. Nelson Mandela, former President of the

49

Republic of South Africa, is the Honorary President of the United World College

International Council.

Located 40 kms. west of Pune, the Mahindra United World College of India brings

together students of various nationalities for a pre-university degree. The school is global

not only because of the International Baccalaureate degree, but also because of the true

international culture in which the students study, live and learn. Each year’s batch of

about 100 students accommodates about 65 to 70 from abroad. The faculty includes

professors from Argentina, Australia, Austria, Cameroon, Canada, Colombia, Ecuador,

France, Germany, India, Italy, Japan, Malaysia, Mexico, the Netherlands, New Zealand,

Sweden, South Africa, UK and USA. The teacher-student ratio is 1:9.

This international mix facilitates global exposure and helps students transcend all

artificial barriers based on race, religion, ethnicity, class, gender or nationality. Keen

focus is given on all-round development, and students are encouraged to think

innovatively by involving themselves in socially and environmentally relevant issues.

The students also contribute to the local neighbourhood through community service

programmes.

Health & Disaster Relief

Mahindra Foundation

The Mahindra Foundation has been set up with a specific objective: to provide medical

relief to the poor and needy sections of society. The foundation has helped patients

suffering from cancer, heart ailments as well as burn victims. It has also been very active

during national calamities and disasters and has helped contribute and mobilise resources.

The foundation also extends its support to academia and other professionals and

sportsmen by helping them attend workshops and conferences overseas.

The Mahindra Group has always been very responsive to any major disaster in India.

Whether it's been the tsunami or the Gujarat earthquake, the Mahindra family has got

together and always provided support either by way of financial help or by way of

sending vehicles, supplying material or manpower.

50

Arts & Culture

Theatre Week

The Mahindra Excellence in Theatre Awards (META) is the latest in the Mahindra

Group’s efforts to encourage national theatre in two broad categories - Emerging theatre

and Established theatre. The annual awards are in tune with the Group’s Corporate Social

Responsibility programmes, which have already received a fillip in the Conglomerate’s

60th anniversary year. The awards will initially cover English & Hindi theatre and

includeother language productions at a later stage. The Critic’s Panel, consisting of

expert theatre and literary personalities based in the four metros, has overseen the

selection of the plays in both categories.

The selection process covers four broad areas of the country, namely, North, South, East

and West. The Critic’s Panels are based in each of the four regional hubs of Kolkata,

Mumbai, Delhi and Bangalore.

Six plays are selected from each region and are referred to the respective Critic’s Panel.

The Panel from each metro city then sends the final list of eight productions to the Grand

National Jury.

The Grand National Jury for the year 2006 includes theatre luminaries such as

Shyamanand Jalan, Shabana Azmi, Ila Arun, Shashi Kapoor, Zafar Hai and M. S. Sathyu.

The Mahindra Group also plans to set up a Mahindra Academy for Excellence in Theatre.

Environmental Initiatives

Environment protection is a part of everyday being at the Mahindra Group. Right from

Mahindra products such as vehicles which are designed meeting International standards

of Safety and emission, to all Mahindra plants across the nation which comply way

beyond necessary environmental regulations by setting new standards in natural resource

conservation, efficient water management and with the most recent Green IT; Mahindra

shows that it care of planet earth proactively.

Towards making planet earth greener, the Group has vowed to plant a One Million Trees

across the Nation by October 2008 under the Mahindra Hariyali initiative. Mahindra

Hariyali, is a mass tree plantation initiative undertaken by each and every Mahindra

location - be it a Plant/factory setting or a corporate office. Shramdaan by Mahindra

51

employees (and their families) themselves and even Mahindra dealers is a major driver of

the initiative. With strong and meaningful partnerships with various stakeholders in the

civil society such as schools, colleges, trusts, and also the Government (Forest

Departments etc), the Mahindra Hariyali model ensures plantation and nurturing of these

trees in the society at large. What started as a seed with top management vision is now

bearing fruits towards reaching the zenith of completion.

Since 1984, the Mahindra Group has been lending a hand to the ‘Green Bombay’

movement by developing and maintaining municipal gardens. Greenery is at a high

premium as the city has less than half an acre of open place per thousand people. That’s

ten times less than Delhi and twenty times less than what London offers.

The Group has transformed three municipal gardens:

The Shivaji Garden (near Gateway of India) is admired for its beautiful architecture and

flourishing plants and flowers. Completely renovated by the Mahindra Group at a cost of

Rs. 6 Lakhs, it now has pathways for pedestrians as well as new stretches

of lawns and flowers. An area formerly frequented by anti-social elements has been

merged with the garden, to prevent further misuse. Every effort has been taken to keep

the garden in an immaculate condition and visiting hours are in place, facilitating

maintenance work.

The Traffic Island Garden (opposite Regal Cinema) has been completely renovated by

the Mahindra Group at the cost of Rs. 1 Lakh. New lamp posts and a variety of plants

were put into place and the fountain was restored to its former glory. The garden provides

visual relief in this crowded and traffic congested circle.

The third garden is located at the junction of Madame Cama Road, to the south of Oval

Maidan. This is a brand new garden, developed by the group from scratch, at a cost of Rs.

1.5 Lakhs. Formerly misused by vagrants, it is now a serene and beautiful little corner.

Excerpts from letters of appreciation the Mahindra Group has received over the

years:

The President of India and all VVIP's who witnessed the Presidential Review recently

were very happy about the way the Gateway has been given a new look. This was mainly

52

because your organisation did a splendid job in giving a face-lift to Shivaji Garden,

which added to the beauty of the surroundings. With your co-operation, the garden stands

out as a model to be emulated by others.

- Mr. D.M. Sukthankar, Municipal Commissioner, Bombay

The Review of the Fleet by the President of India on February 12, 1984 and the other

functions concerned with it have been a great success. This achievement would not have

been possible without the dedicated efforts of a number of agencies. I would like to

especially thank you for your personal interest in the beautification of the garden at the

Gateway of India, which distinctively lent charm and character to the Beating Retreat

Ceremony and reception that followed.

- Vice Admiral R.H. Tahiliant, Flat Office Commanding-in-Chief, Western Naval

Command, Bombay

The traffic island opposite Regal Cinema has become a beautifully appointed garden. Of

greater merit perhaps would be your initiative at undertaking such a job. I consider this a

textbook example of showing us a simple, albeit effective way of improving the quality

of life in this crowded metropolis.

- Sr. Columbiere, Principal, St. Annes School, Bombay

A long-time resident of Bombay, I have been in the Virgin Islands, USA, for the past two

years. On a recent visit home, I was pleasantly surprised to see new greenery in this city.

The garden at the side of Oval Maidan with its pretty lawns and flaming bougainvillea

specially caught my eye. I am sure that citizens of Bombay greatly appreciated your

company's efforts in beautifying our city.

- Shobha Idnani

53

Sports

Mahindra United Football

a)      History

All work and no play can indeed make a company very dull. That’s why a simple club

with a few games and basic amenities was set up in 1950. No one ever thought that this

would grow into an establishment that ran a professional team and offered high quality

facilities, incentives and allowances.

The shift was gradual. In 1956, a group of youngsters enrolled themselves as the

Mahindra official team in the Bombay Football League and made valiant efforts to reach

the top. To further improve the standards, the company provided a full- size football

field for practice and training. At this point, with the football teams representing the

company at tournaments in Bombay, the need for a sports club arose. So the Mahindra &

Mahindra Allied Company Sports Club came into being in 1962.

Since then the team has gone from strength to strength, getting into Bombay’s senior

division Harwood League in 1964 and earned the dashing sobriquet, ‘The Giant Killers’.

Football was developing in Maharashtra and in Mahindra too. In 1969, Mr. Harish

Mahindra was elected Vice President of Western India Football Association (WIFA).

Mahindra & Mahindra Allied Company Sports Club, then known as the Orange Brigade,

was the most popular team in Maharashtra after strong teams like TATA’s, Mafatlal’s

and Caltex. The late 80’s saw Mahindra emerge as one of the most formidable teams in

the country, attracting talented international players like P. M. Shivdas, C. Mustafa, Jerry

Bassi, Henry Menezes, Santosh Kashyap and Godfrey Pereira. Top teams like East

Bengal, Mohun Bagan and Mohammedan Sporting went all out to recruit the Mahindra

players.

In 2000, the Mahindra Football Team underwent a total revamp and the Orange Brigade

turned red. The team was renamed Mahindra United under the leadership of Mr. Alan

Durante, Executive Director & President of the Automotive Sector. Committed support

from the Chairman, Keshub Mahindra, and Managing Director & Vice Chairman, Anand

Mahindra, set the ball rolling. Big names like Raghavan, Derek Desouza, Harish Rao,

Karel Stromsik, David Booth and Dhronacharya Awardee, Syed Nayeemuddin, have

coached the team and taken it from victory to victory.

54

There's been no looking back since then. Mahindra United of Mumbai is the only team in

Maharashtra to win the Durand Cup twice, which is the second oldest trophy in the

world. It is also the first team in Maharashtra to win the Harwood League and the

Nadkarni Cup three times in a row. In fact, right now the Indian football team too, is led

by the captain of Mahindra United.

b)      Mahindra United Under - 19 years

In an attempt to nurture young talent and promote football in Mumbai, Mahindra United

fielded an Under-19 years team from 2003. The team performed extremely well in the

NFL league for U-19 years and reached the semi-finals, beating teams like Churchill Bros

and Salgaocars. This promotion of the U-19 years team has helped the players to develop

and display their talent at the top level and has got them instant recognition and offers

from some leading clubs in Mumbai.

c)       Mahindra United Under - 15 years

Spurred by the success of its U-19 years team, Mahindra United fielded an Under-15

years team from 2006. The team played the Manchester United Premier Cup Asian

Qualifiers held at Kolkata where top NFL Clubs participated.

Awards & Recognitions – 2008

The Nashik Plant became the first plant to win the prestigious CII National Award

for Excellence in Energy Management 2008 at an event held in Pune on 22nd and

23rd August 2008.. The award recognizes various industrial sectors for their

outstanding contribution to Energy Conservation and Management. The award

was conferred on the basis of Nashik plant’s various energy conservation

initiatives and its performance over the last three years.

Mahindra & Mahindra was honoured with the Businessworld FICCI-SEDF

Corporate Social Responsibility Award from the Honourable Finance Minister,

Mr. P. Chidambaram in New Delhi on May 18, 2008. Instituted in 1999, the

Businessworld FICCI-SEDF Corporate Social Responsibility Award identifies and

recognizes the efforts of companies in integrating and internalizing CSR into their

55

core business operations. Mahindra’s CSR activities focus on the three areas of

education, environment and health, and the company has pledged 1% of its profit

after tax (PAT) on a continuing basis for CSR activities.

M&M won the Auto Monitor CSR award for the Lifeline Express at a glittering

ceremony held in New Delhi on the 7th of March 2008. The Lifeline Express was

the organization’s largest Esops initiative and was undertaken by the FES

Rudrapur plant, who together with other volunteers such as doctors put in an

amazing 21,742 man hours.

On January 18, Mahindra and Mahindra won the BSE award for Best Corporate

Social Responsibility Practice at the Social and Corporate Governance Awards

(Innovative strategies - Measurable Impacts), presented by BSE and NASSCOM

Foundation. The Award ceremony was the culmination of the Business for Social

Responsibility Contest organized by BSE and NASSCOM Foundation in which

Mahindra and Mahindra Limited was short listed along with 28 other Corporates

for the category Best Corporate Social Responsibility Practice.

2.8 LARSEN & TOUBRO LTD.25

CSR activities:

L&T believes that the true and full measure of growth, success and progress lies beyond

balance sheets or conventional economic indices. It is best reflected in the difference that

business and industry make to the lives of people. Through its social investments, L&T

addresses the needs of communities residing in the vicinity of its facilities, taking

sustainable initiatives in the areas of heath, education, environment conservation,

infrastructure and community development.

The company proactively provides assistance in situations such as natural calamities and

assists victims of nature's fury or social neglect. Many social initiatives are undertaken in

partnership with government agencies and NGOs.

25 http://www.karmayog.org/csr501to1000/csr501to1000_21150.htm

56

Health

L&T's participates in building a healthy community through continuing initiatives in

several areas of healthcare, with a focus on mother & child care and HIV/AIDS

awareness. All L&T locations, including construction sites, have in-house AIDS

awareness programs. Five additional mother & child care centers were set up in 2006-07.

In partnership with local NGOs, these centres benefit children of commercial sex

workers, street children and tribal communities.

Through health care centres and regular family camps L&T organizes health checkups,

provides gynaecology and laboratory facilities, carries out free cataract surgeries and

intra ocular lens implants, and helps maintain health data for children.Supply of

equipment and aid for orphanages and physically challenged children, periodic

counseling to combat rampant alcoholism, awareness camps on childcare, reproductive

health, sanitation, dental check-up, provision for safe drinking water, cancer awareness

etc. are other healthcare activities that L&T supports.

Education:

L&T's diverse and sustained programmes in education provide underprivileged children

with learning opportunities through supply of educational materials, teaching aids,

recreational tools and up scaling school infrastructure. L&T also enriches children's lives

through programmes like summer camps, maths coaching, providing facilities like

science laboratories, scholarship to deserving students, etc.

The vocational training institutes of the Larsen and Toubro Public Charitable Trust,

provide local communities with skill-based training in Formwork, Masonry, Agro

Mechanics, Electricals, Fabrication, Welding and Housekeeping.Various diploma courses

are also conducted by L&T Institute of Technology for the children of employees. L&T

has developed training modules in local languages in six centres across India for

imparting skills sets in construction. L&T Training Centers provide courses for

improving the standards of electrical engineering practices and for upgrading knowledge

of maintenance, repair and welding.

57

Environment

Global warming: at L&T, we have always been conscious of the need to maintain

harmony with the environment. We continuously seek newer environment-friendly

approaches in all our operations – energy conservation, exploring alternative sources like

wind and solar energy, waste water reduction, etc.

The Zero Discharge approach of the Powai Campus saves over 350,000 litres water

everyday through water treatment and recycling. More than 13,500 trees have been

planted in different L&T campuses in the last year, and an additional 4,000 saplings were

distributed among local communities.

Response to natural calamities

L&T and its employees have provided relief measures during natural calamities like

earthquake and floods. L&T has assisted in disaster relief through employee and

corporate donations, employee volunteering, supply of construction material, medical and

food supplies. After the floods in Surat (Gujarat-India), L&T played a major role in road-

clearing operations, organising medical camps, and supply of food, water, clothes and

other relief materials.

Employee Volunterring

L&T encourages employees to volunteer for CSR activities, resulting in a self-driven

approach while retaining consistency. L&T employees and the ladies clubs formed by

their families at different locations, serve their communities by investing personal

resources and time.

From taking initiatives in building the next generation of productive citizens,

empowering women, paying regular visits to old age homes and orphanages, to

organising blood donation camps, our employees have always believed in truly making a

difference to the world in which they live.

58

RECOMMENDATIONS

A company must spend a minimum of 0.2% of annual sales on CSR

A company must publish its CSR activities in the annual report, or in a separate

Sustainability Report

International guidelines for Environment, Health and Safety as well as for

industry-specific processes exist, and a company must adopt these along with

using its core competence for CSR, and must link CSR to its physical location and

reach.

The CSR policy of the business entity should provide for an implementation

strategy which should include identification of projects/activities, setting

measurable physical targets with timeframe, organizational mechanism and

responsibilities, time schedules and monitoring. Companies may partner with local

authorities, business associations and civil society/non-government organizations.

They may influence the supply chain for CSR initiative and motivate employees

for voluntary effort for social development. They may evolve a system of need

assessment and impact assessment while undertaking CSR activities in a particular

area. Independent evaluation may also be undertaken for selected

projects/activities from time to time.

Companies should allocate specific amount in their budgets for CSR activities.

This amount may be related to profits after tax, cost of planned CSR activities or

any other suitable parameter.

To share experiences and network with other organizations the company should

engage with well established and recognized programmes/platforms which

encourage responsible business practices and CSR activities. This would help

companies to improve on their CSR strategies and effectively project the image of

being socially responsible.

The companies should disseminate information on CSR policy, activities and

progress in a structured manner to all their stakeholders and the public at large

through their website, annual reports, and other communication media.

59

Government and Industry Associations to support companies generating green and

renewable energy

Government and Industry Associations to send letters of appreciation to those

companies that succeed in substantial reduction in energy consumption and

wastage

Government along with Industry Associations to rate companies on the scale 1-5

based on a responsibility index. This result to be widely published. Tax

concessions to be given to companies that secure CSR high ratings.

Companies should take measures to check and prevent pollution; recycle, manage

and reduce waste, should manage natural resources in a sustainable manner and

ensure optimal use of resources like land and water, should proactively respond to

the challenges of climate change by adopting cleaner production methods,

promoting efficient use of energy and environment friendly technologies.

Depending upon their core competency and business interest, companies should

undertake activities for economic and social development of communities and

geographical areas, particularly in the vicinity of their operations. These could

include: education, skill building for livelihood of people, health, cultural and

social welfare etc., particularly targeting at disadvantaged sections of society.

60

CONCLUSION

Even though companies are taking serious efforts for the sustained development, some

critics still are questioning the concept of CSR. There are people who claim that

Corporate Social Responsibility underlies some hidden motives while others consider it

as a myth. Is CSR really a stalking horse for an anti-corporate agenda? The reality is that

CSR is not a tactic for brand building. Indulging into activities that help society in one

way or the other only adds to the goodwill of a company. Rural people can become a

viable market for the corporate with a developmental approach of social marketing.

Organisations can launch social responsibility initiatives in order to build brands in the

rural areas. The social responsibility initiatives are far more effective in building brands

in rural market than the commercial advertisements.

With increasing and widespread commitment of corporate resources to CSR, attention is

now shifting to the strategic formulation, implementation, and measurement of the

market returns to CSR initiatives. But still a concern to companies is whether their focus

on “doing good,” will provide positive returns to their CSR actions. This emphsize the

need for better measurement models of CSR that capture and estimate clearly the effects

of a company’s CSR actions on its stakeholders as well as the nations in which they are

operating. The developing economy like India is progressing at a growth which is much

higher to its social growth. It is increasing the gap between the different strata of society

in the country in terms of employment, human development, capital distribution and

poverty. Public sectors companies and government are continuously introducing reforms

to achieve the balance but it seems that it is not sufficient to bring revolutionary changes

in the social progress. So there is urgent need that all stakeholders in national economic

development put synergistic effort to create a impact. This balancing has to be achieved

or growth has to be stabilized in respect to social growth else the divergence between

them will cross a threshold and after that a downfall will come which will lead to a

stagnancies in growth.

61

CSR is about common sense policies that represent a means of integrating a complete

‘social perspective’ into all aspects of operations. The goal is to maximize true value and

benefit for an organization, while protecting the huge investments corporations make

today in their brands. CSR asks companies to ensure their business operations are clean

and equitable, and contribute positively to the society in which they are based. Otherwise,

they leave themselves open to too much danger from a potential consumer backlash.

CSR is good business sense, and a total approach to doing business, in a globalizing

world where companies are increasingly relying on brand strength (particularly global

lifestyle brands) to add value and product differentiation, and where NGO-driven

consumer activism is increasing.

Many believe the issue of how corporations integrate CSR into everyday operations and

longterm strategic planning will define the business marketplace in the near future. It will

become a key point of brand differentiation, both in terms of corporate entities and the

products that carry their brands.

Key steps on the road to integrating CSR within all aspects of operations include:

Ensure the commitment of top management, and particularly the CEO, is

communicated throughout the organization

Appoint a CSR position at the strategic decision-making level to manage the

development of policy and its implementation

Develop relationships with all stakeholder groups and interests (particular relevant

NGOs)

Incorporate a Social or CSR Audit within the company’s annual report

62

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http://www.karmayog.org/csr501to1000/csr501to1000_21977.htm

http://www.karmayog.org/csr501to1000/csr501to1000_22167.htm

http://www.adityabirla.com/social_projects/overview.htm

http://www.adityabirla.com/social_projects/downloads/csr_policy.pdf

http://www.karmayog.org/csr501to1000/csr501to1000_20979.htm

http://www.karmayog.org/csr501to1000/csr501to1000_21150.htm

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