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Is Corporate India doing enough?
Corporate Social Responsibility is not a new concept in India. Ever since their inception, corporates like the Tata Group, the Aditya Birla Group, the Wipro and the Infosys, to name a few prominent ones, have been involved in serving the community. Through donations and charity events, many other companies have been doing their part for society.
However, CSR has been taken more seriously in India after the Corporate Social Responsibility law came into effect in April 2014. Propelled by this impetus, a lot of good work for social causes is being done by Corporate India with CSR finding a permanent place in approximately 16,000 company boardrooms.
But there is a flipside to the story as well. A reality check done by Bureaucracy Today reveals that there is a lack of awareness of CSR guidelines among many corporates. Several top corporate honchos cutting across sectors are performing tasks which do not come under the CSR guidelines.
Another disturbing trend is the apparent partiality shown by many corporates in their CSR spending towards the States that have low industrial and business activity. It is seen that a majority of the companies opened their purse strings for the States that already have a sizeable corporate presence such as Maharashtra, Gujarat, Delhi, Tamil Nadu, Karnataka and Andhra Pradesh. The backward areas of India like the Northeastern States and the Union Territories of Lakshadweep, Daman and Diu, Andaman and Nicobar Islands and Dadra and Nagar Haveli where social and economic development is most needed are witnessing little CSR spending.
Another aspect of the entire issue is the mushrooming of NGOs. The Government's suggested CSR activities include measures to eradicate hunger, promote education, environmental sustainability and rural sports, protect national heritage and make contributions to the Prime Minister's National relief fund. As per the guidelines, a company can perform these CSR tasks either on its own through its non-profit foundation or through independently registered non-profit organizations. This provision in the CSR law has led to a boom in the number of NGOs in India. As such, it raises a genuine doubt about the credibility and intention of many NGOs. According to a media report, there are over two million operational NGOs in India. Choosing the right one from such a large number of NGOs is not an easy task.
Our Cover Story in this CSR-Special Edition attempts to bring to light the gaps in corporate CSR activities in India while highlighting the extraordinary social tasks performed by Corporate India which are bringing smiles to the faces of thousands of underprivileged people. At the same time, it also raises a pertinent question – why should not the Government put in place an effective monitoring mechanism to ensure compliance with the guidelines and see to it that CSR spendings are done judiciously without any bias by companies? Monitoring CSR spendings will make the entire effort a tangible reality rather than an exercise just for the heck of it.
Source: https://bureaucracytoday.com/editor_spk.aspx?id=10067
However, CSR has been taken more seriously in India after the Corporate Social Responsibility law came into effect in April 2014. Propelled by this impetus, a lot of good work for social causes is being done by Corporate India with CSR finding a permanent place in approximately 16,000 company boardrooms.
But there is a flipside to the story as well. A reality check done by Bureaucracy Today reveals that there is a lack of awareness of CSR guidelines among many corporates. Several top corporate honchos cutting across sectors are performing tasks which do not come under the CSR guidelines.
Another disturbing trend is the apparent partiality shown by many corporates in their CSR spending towards the States that have low industrial and business activity. It is seen that a majority of the companies opened their purse strings for the States that already have a sizeable corporate presence such as Maharashtra, Gujarat, Delhi, Tamil Nadu, Karnataka and Andhra Pradesh. The backward areas of India like the Northeastern States and the Union Territories of Lakshadweep, Daman and Diu, Andaman and Nicobar Islands and Dadra and Nagar Haveli where social and economic development is most needed are witnessing little CSR spending.
Another aspect of the entire issue is the mushrooming of NGOs. The Government's suggested CSR activities include measures to eradicate hunger, promote education, environmental sustainability and rural sports, protect national heritage and make contributions to the Prime Minister's National relief fund. As per the guidelines, a company can perform these CSR tasks either on its own through its non-profit foundation or through independently registered non-profit organizations. This provision in the CSR law has led to a boom in the number of NGOs in India. As such, it raises a genuine doubt about the credibility and intention of many NGOs. According to a media report, there are over two million operational NGOs in India. Choosing the right one from such a large number of NGOs is not an easy task.
Our Cover Story in this CSR-Special Edition attempts to bring to light the gaps in corporate CSR activities in India while highlighting the extraordinary social tasks performed by Corporate India which are bringing smiles to the faces of thousands of underprivileged people. At the same time, it also raises a pertinent question – why should not the Government put in place an effective monitoring mechanism to ensure compliance with the guidelines and see to it that CSR spendings are done judiciously without any bias by companies? Monitoring CSR spendings will make the entire effort a tangible reality rather than an exercise just for the heck of it.
Source: https://bureaucracytoday.com/editor_spk.aspx?id=10067
Odisha finance minister suggests state-level CSR body
BHUBANESWAR: Finance minister Pradip Amat on Friday asked corporates to adjust their corporate social responsibility (CSR) works in sync with the state government priorities under a state-level CSR-body.
Speaking at an event, Inclusive India Forum 2016, at Xavier Institute of Management Bhubaneswar (XIMB), Amat said "Odisha can gain if corporates working in the state work together on identified priority sectors together with the state government. This has to be done through formation of a state level CSR body that could lay the roadmap for such expenditure," he said.
District level CSR monitoring and evaluation needs to be taken up to see that there is no undue delay, he said.
CSR expenditure, now mandated by the central government can bring in large scale changes in several development parameters that are vital for sustainable development, Amat said.
The CSR regulations have provided much more than a portion of corporate budget for community development. It is an opportunity for companies to harness their captive resources and talent pool for effective stakeholder engagement. It has to be a strategic function that can provide social benefit and competitive advantage at the same time, he said.
The focus of the forum, organized by Harvard Business School Club of India (alumni of HBS in India) and XIMB, was is to discuss and debate on how to scale the social impact of CSR initiatives- particularly in the field of education, healthcare and livelihoods, the organizers said.
Source: http://timesofindia.indiatimes.com/city/bhubaneswar/Odisha-finance-minister-suggests-state-level-CSR-body/articleshow/50683348.cms
Speaking at an event, Inclusive India Forum 2016, at Xavier Institute of Management Bhubaneswar (XIMB), Amat said "Odisha can gain if corporates working in the state work together on identified priority sectors together with the state government. This has to be done through formation of a state level CSR body that could lay the roadmap for such expenditure," he said.
District level CSR monitoring and evaluation needs to be taken up to see that there is no undue delay, he said.
CSR expenditure, now mandated by the central government can bring in large scale changes in several development parameters that are vital for sustainable development, Amat said.
The CSR regulations have provided much more than a portion of corporate budget for community development. It is an opportunity for companies to harness their captive resources and talent pool for effective stakeholder engagement. It has to be a strategic function that can provide social benefit and competitive advantage at the same time, he said.
The focus of the forum, organized by Harvard Business School Club of India (alumni of HBS in India) and XIMB, was is to discuss and debate on how to scale the social impact of CSR initiatives- particularly in the field of education, healthcare and livelihoods, the organizers said.
Source: http://timesofindia.indiatimes.com/city/bhubaneswar/Odisha-finance-minister-suggests-state-level-CSR-body/articleshow/50683348.cms
Milton Charitable Foundation for the Visually Handicapped invites applications for Job Skill Training of differentabled youth from February 2016 onwards.
Milton Charitable Foundation for the Visually Handicapped invites applications for Job Skill Training of differentabled youth from February 2016 onwards.
Course Duration – 6 Months
Eligibility – The candidates should have more than 40% of disability and most have completed 12th standard or above with minimum 50% of marks. They most have the minimum ability of understanding & writing English.
Course Overview – The candidates who will be enrolled in this programme they will be imparted regular training classes on General knowledge, banking awareness, Mathematics & Reasoning attitude, communicative skill & computer attitude and standardized computer application related to various jobs throughout the six month training programme. The candidates from both the local and remote areas are allowed. Boarding & fooding accommodation will be provided if required by the candidate.
The interested candidates may send their Bio-data and Resume through E-mail – mcfvhodisha@gmail.com, helpdesk@mcfvh.org by 31st January 2016.
Thursday, January 7, 2016
Linking CSR with business practices
CSR in India has been detached from business practices. A more effective approach to CSR would entail efforts to integrate sustainable business with societal giving, rather than simply requiring companies to donate money and outsource all of its CSR efforts.
Over the last two decades, Indian companies have grown and become globally competitive. However, social and economic inclusion has not paralleled economic growth.
Both the previous and present government have seen the private sector as critical to the future prosperity of the country and its citizens. In this context, the 2013 Companies Act is a push for companies to develop and expand their corporate social responsibility (CSR) programs.
The role of private capital in shaping society is undeniable. However a law requiring corporates to be more mindful of their impact has raised a public debate about social priorities, and the great potential of CSR to foster the energy, talent, and resources of India’s robust corporate sector to improve the lives of all Indians.
India’s approach to, and definition of, CSR are quite distinct from most other countries. In various parts of the world, CSR is intertwined with sustainable and responsible business practices as well as social work efforts. CSR in India currently takes a philanthropy centered and number-centric approach, focused on output rather than strategic outcomes. In India, CSR is detached from business practices. This divide, created by the Ministry of Corporate Affairs in the hope of avoiding brand marketing or corporate perks, has forced CSR boards to keep charity efforts separate from a corporate’s expertise.
While CSR efforts ultimately create a net positive result, the current discussion revolves around whether the law is written in a way that promotes the most impactful processes and long lasting results and, if not, how the law can be reworked.
The potential of CSR lies in harnessing the particular strengths of a company to integrate sustainable business with societal giving, rather than simply requiring the company to donate money and outsource all of its CSR efforts.
The strict definition of CSR in the Act emphasizes the involvement of corporates with certain types of social causes in partnership with NGOs. Health and education have gained a tremendous amount of support and funding, while relatively more controversial and non-traditional causes have received less assistance. The narrow definition and the even narrower efforts made by many companies only address specific needs rather than nurturing civil society more generally. Furthermore, government-backed programs are benefiting from corporate giving, as many companies have tailored their CSR programs to fit in with governmental goals. While CSR in any form is beneficial, the CSR scale in India is tipped in favor of conventional causes and away from social innovation.
Whatever the causes, the government suggests that companies partner with NGOs to help in their CSR efforts. With screenings and field visits, NGOs are at the mercy of corporates who choose these partnerships. Corporates are looking for NGOs that possess capacity, knowledge, and resources, and will be able to handle their strict requirements of project monitoring and reporting. This means that large NGOs have been accumulating more partnerships, while corporate support tends to stay away from smaller NGOs. The big get bigger while the small are starved of resources, which reduces the range of new ideas and policies being developed.
While NGOs provide an established framework and infrastructure for companies to build their CSR efforts upon, the cost of compliance raises the question: why should companies bother to comply with the law? Creating a CSR committee, reporting CSR activity annually in a specified format, creating an internal CSR structure, using third parties such as law firms or CSR consultancy firms, and complying with other aspects of the law, all add up to a significant effort. These hurdles detract attention from where it truly should be directed: socially responsible practices.
Moreover, the Act stipulates no penalty for non-compliance with regard to spending 2% of a company’s profits on CSR. The reasons to comply are then only a willingness to obey the law and the pressure to comply that is created by consumers and other companies.
As the first country in the world to legally mandate CSR, India does not have an existing model to follow or successful example to emulate. There is, however, scope for continued discussion and reform. After only one fiscal year, we saw trends in the CSR environment and recognized the potential impact that could be made; what is less certain is whether that potential will become reality.
If the 2013 Companies Act is effective, social spending will continue increasing, corporates will steadily play a larger role in CSR efforts, and the standard of living of the neediest will improve. However, corporate giving cannot be a substitute for effective governance.
Source: http://www.gatewayhouse.in/linking-csr-with-business-practices
Over the last two decades, Indian companies have grown and become globally competitive. However, social and economic inclusion has not paralleled economic growth.
Both the previous and present government have seen the private sector as critical to the future prosperity of the country and its citizens. In this context, the 2013 Companies Act is a push for companies to develop and expand their corporate social responsibility (CSR) programs.
The role of private capital in shaping society is undeniable. However a law requiring corporates to be more mindful of their impact has raised a public debate about social priorities, and the great potential of CSR to foster the energy, talent, and resources of India’s robust corporate sector to improve the lives of all Indians.
India’s approach to, and definition of, CSR are quite distinct from most other countries. In various parts of the world, CSR is intertwined with sustainable and responsible business practices as well as social work efforts. CSR in India currently takes a philanthropy centered and number-centric approach, focused on output rather than strategic outcomes. In India, CSR is detached from business practices. This divide, created by the Ministry of Corporate Affairs in the hope of avoiding brand marketing or corporate perks, has forced CSR boards to keep charity efforts separate from a corporate’s expertise.
While CSR efforts ultimately create a net positive result, the current discussion revolves around whether the law is written in a way that promotes the most impactful processes and long lasting results and, if not, how the law can be reworked.
The potential of CSR lies in harnessing the particular strengths of a company to integrate sustainable business with societal giving, rather than simply requiring the company to donate money and outsource all of its CSR efforts.
The strict definition of CSR in the Act emphasizes the involvement of corporates with certain types of social causes in partnership with NGOs. Health and education have gained a tremendous amount of support and funding, while relatively more controversial and non-traditional causes have received less assistance. The narrow definition and the even narrower efforts made by many companies only address specific needs rather than nurturing civil society more generally. Furthermore, government-backed programs are benefiting from corporate giving, as many companies have tailored their CSR programs to fit in with governmental goals. While CSR in any form is beneficial, the CSR scale in India is tipped in favor of conventional causes and away from social innovation.
Whatever the causes, the government suggests that companies partner with NGOs to help in their CSR efforts. With screenings and field visits, NGOs are at the mercy of corporates who choose these partnerships. Corporates are looking for NGOs that possess capacity, knowledge, and resources, and will be able to handle their strict requirements of project monitoring and reporting. This means that large NGOs have been accumulating more partnerships, while corporate support tends to stay away from smaller NGOs. The big get bigger while the small are starved of resources, which reduces the range of new ideas and policies being developed.
While NGOs provide an established framework and infrastructure for companies to build their CSR efforts upon, the cost of compliance raises the question: why should companies bother to comply with the law? Creating a CSR committee, reporting CSR activity annually in a specified format, creating an internal CSR structure, using third parties such as law firms or CSR consultancy firms, and complying with other aspects of the law, all add up to a significant effort. These hurdles detract attention from where it truly should be directed: socially responsible practices.
Moreover, the Act stipulates no penalty for non-compliance with regard to spending 2% of a company’s profits on CSR. The reasons to comply are then only a willingness to obey the law and the pressure to comply that is created by consumers and other companies.
As the first country in the world to legally mandate CSR, India does not have an existing model to follow or successful example to emulate. There is, however, scope for continued discussion and reform. After only one fiscal year, we saw trends in the CSR environment and recognized the potential impact that could be made; what is less certain is whether that potential will become reality.
If the 2013 Companies Act is effective, social spending will continue increasing, corporates will steadily play a larger role in CSR efforts, and the standard of living of the neediest will improve. However, corporate giving cannot be a substitute for effective governance.
Source: http://www.gatewayhouse.in/linking-csr-with-business-practices
Linking businesses and NGOs for CSR
The Ministry of Corporate Affairs’ notice last year directing companies to partner with NGOs for their CSR efforts requires companies to choose partners carefully, while NGOs must focus on monitoring and other requirements—so both sides are trying to address gaps and work with each other’s strengths
The interaction between Indian corporations and non-governmental organisations (NGOs) increased after the Indian Companies Act of 2013 was passed. In a notice published by the Ministry of Corporate Affairs, companies were directed to work with partners (specifically, NGOs) who have “an established track record of three years in undertaking similar programs or projects.”
The CSR departments of some large companies have, since then, reportedly received a tremendous influx of appeals from NGOs for partnerships. However, companies have to choose partners wisely in order to ensure that their money is well spent.
The process of choosing an NGO partner typically involves a screening process. This can include a credibility test, a field visit, and background checks. It may also involve using the expertise of a CSR consulting firm. Many companies require NGOs to sign a memorandum of understanding (MoU) before entering into a partnership, and they also require monthly or annual impact assessment reports from the NGO. While these activities are essential to ensure that the NGO is reputable, it is also a financial burden for the companies as well as the NGOs. To avoid these additional costs, many companies involved in partnerships prior to the Act are simply strengthening those existing ties.
An important concern for companies is finding an organisation that has the appropriate amount of resources, knowledge, and capacity. As the Act pertains to large corporations, it follows that they are primarily looking to match up with large NGOs that fit this description. Working with reputable NGOs eliminates the worry of malpractice, while also providing a way to channel the majority of their funds and efforts.
What are the implications of this change for NGOs? Companies are demanding high standards from NGOs, especially in project monitoring. This means NGOs may have to devote more time to monitoring their projects rather than carrying them out. A Yes Bank CSR representative points out: “NGOs…don’t have the capacity or the priority to communicate and provide reporting to all the corporates that support them.” Their work is thus either diluted, or NGOs with limited human resources are not able to gain the credibility needed to hold on to partnerships. A CSR representative from Hindustan Petroleum points out that this limits the ability of grassroots organisations to gain momentum since they are not able to scale up or gain the requisite experience.
The choice companies have to make of whether to focus CSR efforts on output or outcome adds tension to the relationship. Output focuses on numbers: it is what companies put in their brochures to advertise the amount of people reached. Outcome is the long-term and lasting change created. Based on our analysis of nearly 200 companies, corporations are trending towards a focus on output rather than outcome.
In order to shift the focus, corporations and NGOs must work more collaboratively. To do so, corporates could increase the quantum of employee engagement in CSR efforts. The GMR Varalakshmi Foundation, for example, added employee’s CSR involvement to their performance reports. So far, however, this has not been a focus for most companies.
Increasing the role employees play in CSR efforts will ingrain the value of social responsibility in the company rather than it being treated as a separate unit. It will also allow for an exchange of skills between corporates and NGOs. Working with each other’s strengths and fostering a sense of shared responsibility can shift the focus to outcome rather than output.
Source: http://www.gatewayhouse.in/linking-businesses-and-ngos-for-csr
The interaction between Indian corporations and non-governmental organisations (NGOs) increased after the Indian Companies Act of 2013 was passed. In a notice published by the Ministry of Corporate Affairs, companies were directed to work with partners (specifically, NGOs) who have “an established track record of three years in undertaking similar programs or projects.”
The CSR departments of some large companies have, since then, reportedly received a tremendous influx of appeals from NGOs for partnerships. However, companies have to choose partners wisely in order to ensure that their money is well spent.
The process of choosing an NGO partner typically involves a screening process. This can include a credibility test, a field visit, and background checks. It may also involve using the expertise of a CSR consulting firm. Many companies require NGOs to sign a memorandum of understanding (MoU) before entering into a partnership, and they also require monthly or annual impact assessment reports from the NGO. While these activities are essential to ensure that the NGO is reputable, it is also a financial burden for the companies as well as the NGOs. To avoid these additional costs, many companies involved in partnerships prior to the Act are simply strengthening those existing ties.
An important concern for companies is finding an organisation that has the appropriate amount of resources, knowledge, and capacity. As the Act pertains to large corporations, it follows that they are primarily looking to match up with large NGOs that fit this description. Working with reputable NGOs eliminates the worry of malpractice, while also providing a way to channel the majority of their funds and efforts.
What are the implications of this change for NGOs? Companies are demanding high standards from NGOs, especially in project monitoring. This means NGOs may have to devote more time to monitoring their projects rather than carrying them out. A Yes Bank CSR representative points out: “NGOs…don’t have the capacity or the priority to communicate and provide reporting to all the corporates that support them.” Their work is thus either diluted, or NGOs with limited human resources are not able to gain the credibility needed to hold on to partnerships. A CSR representative from Hindustan Petroleum points out that this limits the ability of grassroots organisations to gain momentum since they are not able to scale up or gain the requisite experience.
The choice companies have to make of whether to focus CSR efforts on output or outcome adds tension to the relationship. Output focuses on numbers: it is what companies put in their brochures to advertise the amount of people reached. Outcome is the long-term and lasting change created. Based on our analysis of nearly 200 companies, corporations are trending towards a focus on output rather than outcome.
In order to shift the focus, corporations and NGOs must work more collaboratively. To do so, corporates could increase the quantum of employee engagement in CSR efforts. The GMR Varalakshmi Foundation, for example, added employee’s CSR involvement to their performance reports. So far, however, this has not been a focus for most companies.
Increasing the role employees play in CSR efforts will ingrain the value of social responsibility in the company rather than it being treated as a separate unit. It will also allow for an exchange of skills between corporates and NGOs. Working with each other’s strengths and fostering a sense of shared responsibility can shift the focus to outcome rather than output.
Source: http://www.gatewayhouse.in/linking-businesses-and-ngos-for-csr
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