CSR not most important effect of business on society: Porter

0
94

NEW DELHI:  It has reported that  Corporate social responsibility (CSR) initiatives and philanthropy are not the most important effect of business on society, noted expert on competitive strategy Michael E Porter has said.

PorterThey are important effects of business on society, but not the most important, Porter said in an address at the Porter Prize 2014 event organized by Indian Council on Competitiveness here.

“The way business affects society most is through business. These include the way we produce, the raw materials we use and the way we create and put together better infrastructure in communities we do business in ‘, he said.

The problem with CSR is that it is not “self-sustaining”, said Porter, who is a Professor at Harvard Business School.  India is among very few countries that had legislated CSR as a mandatory activity for corporates.  Companies that fall within the ambit of CSR provisions of the new company law need to spend 2 per cent of their net profits on CSR.

It is estimated that nearly 16,000 companies out of total universe of 11 lakh companies registered in India will fall under the mandatory CSR net.  Simply put, the CSR spend obligation under the new company law will fall only on 16,000 companies.

Porter also said India — when compared with other countries with similar GDP numbers — is under performing on social progress.

“The social progress in India is less than you would expect, given the level of average income per person in the country.  I do take it into consideration that it’s a complex country with lots of States and city level, but these indicators do give an important perspective.”

(The Hindu Business Line)

Comments

comments

SHARE
Previous articleAnil Agarwal Pledges 75% of his Wealth to Charity
Next articleEssentials on Defining an Enterprise Sustainability Program
India CSR Network
India CSR Network is India's biggest and most trusted news portal in the domain of CSR & Sustainability. India CSR welcomes stories, statements, updates, reports on issues that interest you. Feedback, comments will make it more purposeful and resourceful. It is designed and maintained by India CSR Group. Contents are non-fiction. Though all efforts have been made to verify the accuracy, the same should not be construed as a statement of law or used for any legal purposes. In case of any ambiguity or doubts, readers are advised to verify with the source(s). Statement, articles, views and contributions can be sent to editor@indiacsr.in