MUMBAI (India CSR): In this exclusive interview with Harsha Mukherjee, Adi B. Godrej Chairman, Godrej Group shares his views on Corporate Social Responsibility initiatives of the group. Edited excerpts:
Most remarkable change by the CSR activities of Godrej?
The 2% CSR was budgeted in the group much before the law came into existence. Although the spent of full 2% is in the process the social investment made is yielding a lot of benefits to the business visible. Although the outcomes are difficult to measure but the strong CSR positioning has carved a niche in the all the stakeholders mind such as consumers, employees, investors mind about Godrej. Attracting new talent has become easier, people are motivated when company is doing well in CSR.
The prime change is in the ease of doing Business and acceptance at various levels due to the 3 fold CSR activities – Environment friendly, Training and building Good-Green Products.
A little brief about the Good – Green Products and CSR in R&D?
Godrej has compelled it’s R&D team to make Good Green Products which are also economic and help to curb diseases. These products arecatered to the people at the bottom of the pyramid. Good night fast card which you can put on the saucer burn for 3 minutes and the place would be mosquito free for 4 hours. It’s for Rs. 1 each and is cheaper than the mosquito coil which spreads smoke and is not the healthiest means. It is also safe and prevents accidents which may occur due to child touching the mosquito coils.
The product is already successful in Indonesia and now has been introduced in India.
Another product is Chotu Cool which is under test marketing. We are working with Gates Foundation to use them for preserving vaccines since they don’t need a compressor and work on a scientific principal called Peltier effect and even after the electricity goes out it stays cool for 5 hours.
Does Godrej implements it’s philanthropic activities different from CSR?
There are 2 different arms – philanthropy is done by the charitable foundation which is entirely supported by the family members and the CSR arm which is done by the company. That expenditure is completely done by the promoters of Godrej and not the shareholders. The foundation works in Education, health care and other such activities but big focus is the Environment.
For example, The foundation has set-up together with CII, the CII-Godrej Green Business Center in Hyderabad that teaches Indian Business that how Sustainable Business can be very good for not only the country and society but also the business.
Godrej has also conserved 1500 acres of mangroves reserves surrounding their company. Prince Charles who had visited Mumbai earlier in November was taken for a tour in the area filled with greenery and wild life. The real jungle build in the concrete jungle city is frequently visited by the school and college students.
The foundation has also supported the wild life foundation in India.
CSR Exit Strategy?
We do believe in making our CSR activities self sustainable. The training program has to be self sustainable and scaling up is essential.
Has the Business slow down affected the CSR activities?
No, but Godrej hasn’t been much affected by global recession. Last year the GDP growth was 5% and Godrej growth as a company was 28%. Our objective is 10 by 10 i.e. to be 10 times in 10 years which was started in 2011. In order to achieve that the compounded annual growth needs to be 26% which includes inorganic growth that is by means of acquisitions. Godrej has done large acquisitions in Godrej Consumer products especially internationally.
When the acquisitions are done, is CSR of the company looked at and does the parent company forms the CSR strategy for the branches or is it localized?
We don’t look at what CSR they do while acquiring but once they are under Godrej their CSR activities formed based on the local needs. Presently, we have spread in Indonesia, Bangladesh, Sri Lanka, South Africa, Mozambique, Kenya, Nigeria, Argentina, Chile, Uruguay and others.
Godrej develops the CSR strategy based on the local needs of the host countryespecially for Africa which has a lot of Social issues more than India’s.
What are your business activities in Africa and CSR activities surrounding them?
Godrej has 10,000 employees in Africa and 80% of them are women in the factories across the African Continent. We introduce CSR as soon as we enter a new market. One of our business in Africa is “Hair Extensions” where we employ many women and we train them in Hair styling.
CSR holds a lot of cultural relevance, is Godrej active in that space?
Godrej runs a Culture Lab headed by Parmesh Shahani who holds discussion on diverse topics such as Arts, Women Empowerment, Science and others every Friday. In one of the sessions they discussed about pregnant women and work related issues.
What is the Succession Planning and the role of women in business?
My wife, Ms. Parmeshwar Godrej is the Director at Godrej Properties who is also insistent on Sustainability. All the buildings at Godrej Properties are committed to be LEED certified. The CII Godrej Green Building in Hyderabad is the 1st Platinum rated building outside the USA.
My 2 daughters have also joined the business. Since olden days, in Godrej family women have inherited in the same manner as men. So in the 3 children everything is equal and also in terms of leadership and management whoever is the best takes the charge irrespective of their gender.
According to Boston Consulting Group (BCG) if women join workplace fully in India, it would add a percentage point in GDP of our country. Godrej largely employs women and has many women at the senior most position.
Has the investor’s attitude changed since Godrej is a CSR Compliant Company?
Investors look at 3 things – Corporate Governance, CSR is a factor, Sustainability and there has been a significant difference not only in the employees and customers but also Investors.
Should Stock Market reward the companies who are CSR Compliant?
Stock market should reward the companies who give the maximum returns but I strongly believe that CSR, Sustainability add to performance so companies who take it seriously are likely to be more successful. Thus for that reason the company should be supported but not only for CSR alone.
Your thoughts on the current state of CSR mandate?
I was the first one to support in spite of the reluctance from many business houses. Earlier many rules were laid down on the areas of expenditures but after a lot of discussion with Mr. Pilot it was finalized that every company would have a CSR Committee of the Board and whatever they decide will be acceptable and you need to put everything on the website for transparency. It has been overruled that the funds can be given to the political parties or CM funds.
Do you forsee CSR Manpower crunch in near future?
It could be but CII is largely supporting the industries to achieve their goals. CII has collaborated with India@75, they had a major PR launch on 14th November 2013. This movement was supported by Prof. C. K Prahlad who passed away last year. It is his vision of what India should be in it’s 75th year so it’s a very good program which wants to project what India should be and what CII foundation will do is to enable the smaller members to help direct CSR funds fruitfully.
But yes we would require CSR managers in near future. I would like to say that there is no unemployment in India but it’s only un employability. We are short of all kinds of people and CSR Managers. In fact it is very heartening to see that we have a lot of people who want to do that, I have senior managers who tell us we want to work for 2-3 years then we want to go in to some CSR work. It is very good to see people with such dedication.
How would you define CSR as?
CSR is for using corporate managerial talent and economic strength for improving society in various fields.
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