How “Social” Are Our Corporates?

BITS Big Bout Copyright@2005 CEL BITS Pilani

How “social” are our corporates?

-A close look atCorporate Social Responsibility

BITS Big Bout

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Prof. N.RajeshFaculty,Chemistry

Prof. Arya KumarGroupleader,Economics and Finance

Arun SethuramanStudent,IIIrd year

Sindhu Anand-Student,IIIrd year

Panel Members

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First Blood

Companies set up social welfare foundations,charitytrusts etc fora)The satisfaction of giving back to the society.b)Increasing their visibility.c)long-term gains(employee and customer loyalty,tax-benefits etc.)

The primary impetus for increased corporate socialresponsibility has come from a)NGOs and social activists. b)MNCs due to globalization.c)Increased consumer awareness. d)Initiatives of the State.e)The initiatives of the larger corporations in the world.

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Is setting up a social wing by a corporate enough interms of fulfillment of social responsibility?a) Yes,definitelyb) No,CSR should be integrated into the fabric of the companyc) Social wing?Companies should concentrate on making money and let the

govt. take care of the society

When should a company become socially responsible?

a) Definitely since its inception b) When it has achieved some successc) CSR is only for the family owned businesses and the bigwigs in the

industry

First Blood

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First Blood-Prof. N. Rajesh Companies set up social welfare foundations,charitytrusts etc fora)the satisfaction of giving back to the society b)increasing their visibility

The primary impetus for increased corporate socialresponsibility has come froma)NGOs and social activists b)Increased consumer awareness

Is setting up a social wing by a corporate enough interms of fulfillment of social responsibility?b)No,CSR should be integrated into the fabric of the company.

When should a company become socially responsible?b)When it has achieved some success

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First Blood-Prof. Arya Kumar Companies set up social welfare foundations,charitytrusts etc forb)increasing their visibility c)long-term gains

The primary impetus for increased corporate socialresponsibility has come fromb)MNCs due to globalization

Is setting up a social wing by a corporate enough interms of fulfillment of social responsibility?b)No,CSR should be integrated into the fabric of the company.

When should a company become socially responsible?a)Definitely since its inception

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First Blood-Arun Sethuraman Companies set up social welfare foundations,charitytrusts etc forc)long-term gains(employee and customer loyalty,tax-benefits etc.)

The primary impetus for increased corporate socialresponsibility has come fromc)Increased consumer awareness

Is setting up a social wing by a corporate enough interms of fulfillment of social responsibility?b)No,CSR should be integrated into the fabric of the company.

When should a company become socially responsible?a)Definitely since its inception

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First Blood- Sindhu Anand Companies set up social welfare foundations,charitytrusts etc forc)long-term gains(employee and customer loyalty,tax-benefits etc.)

The primary impetus for increased corporate socialresponsibility has come fromc)Increased consumer awareness

Is setting up a social wing by a corporate enough interms of fulfillment of social responsibility?b)No,CSR should be integrated into the fabric of the company.

When should a company become socially responsible?a)Definitely since its inception

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Corporate Social Responsibility

"Corporate Social Responsibility is the continuing commitment by business to behave ethically and contribute to economic development while improving the quality of life of the workforce and their families as well as of the local community and society at large"

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QuoteUnquote

"The business of business is to do business and earn profit.“

-Milton Friedman

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Is everything fair in business?

24%

54%

22%

Yes,makingmoney is theprimary aim,soget it done byhook or by crook

No,ethicsdefinitely matter

A few under-hand deals arefine

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The Enron Example

o Fortune magazine's Most Innovative Company in America six years running

o In the top quartile of Fortune Magazine's 100 Best Companies to Work For

o On the All Star List of Global Most Admired Companies

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Enron(contd..)

In this report, CEO Kenneth Lay described how the company's behaviour were guided by its vision and values: specifically

• respect: mutual respect with communities and stakeholders affected by the company's operations

• integrity: examining the impacts, positive and negative, of the business on the environment and on society, and integrating human health, social and environmental considerations into the company's management and value system

• Excellence: continuing to improve performance and encouraging business partners and suppliers to adhere to the same standards.

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Companies set up social welfare foundations,charity trusts etc for..

15%

37%

48%

The satisfactionof giving back tothe society

Popularity

Long-termbenefits(tax-cuts,customerloyalty)

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Candid Camera

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The Dell story…

For years, the dirty little secret of the computer industry—left unaddressed even by the most environmentally advanced companies—has been the lack of accountability for the safe recycling of computer equipment. The issue is a significant one. Personal computers contain lead, mercury, cadmium, and bromine that should not end up in landfills or incinerators, and that can threaten the health of recycling workers if handled improperly.

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Dell contd..

Dell has launched recently—including a low-cost consumer home pickup and recycling service, a computer recycling grant program to local communities, and a computer collection pilot program in its hometown of Austin, Tex. For 2005, Dell has announced an aggressive aim of a 50 percent increase in global product recovery, making it the first company to publicly release a computer recycling goal.

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When should a company become socially responsible?

49%

20% 31%

Since itsinception

When it hasachieved somesuccess

CSR is only forthe familybusinesses andthe big-wigs inthe industry

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When should a company become socially responsible?

6%

39%55%

Since itsinception

When it hasachieved somesuccess

CSR is only forthe familybusinesses andthe big-wigs inthe industry

Faculty

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In Focus-Battling the AIDS menace

Bristol-Myers Squibb announced that it was lowering the price of itsdrugs in Africa from $20 a day to less than $1. Crucially, it alsoannounced that it would relax its approach to its patent rights. The company announced the following four components of its antiAIDS strategy: Drugs below cost Transparent Pricing Secure the Future Emergency Patent Relief “This is not about profits and patents; it’s about poverty and adevastating disease,” said John L. McGoldrick, executive vicepresident, Bristol-Myers Squibb. “We seek no profits on AIDS drug

in Africa, and we will not let our patents be an obstacle.”

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They said it!!Sumantra Ghoshal, a professor at London Business Schoolbelieved that the desire of business schools to make the study ofbusiness a science,“a kind of physics”,has led them increasingly tobase their management theories on some of the more dismalassumptions and techniques developed by economists. A particularly worrying feature of these theories,says Mr Ghoshal, is that they have no “role for human intentionality or choice”. Students have been freed “from any sense of moral responsibility”. Jeffrey Pfeffer of Stanford University's Graduate School ofBusiness,in support refers to a study in 2000 which found that a linkbetween corporate size and the number of citations for violatinghealth and safety regulations became stronger as the percentage ofa firm's top managers holding an MBA rose .

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21%

28% 14%

37%Stringent laws and standards

Increased awareness

More stress in our social and educational system on theneed to work for your societyPerks(tax-cuts)etc from the govt

What can be done to increase the social responsibility of corporates?

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Where do we stand?

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The BBB team

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