Believe that CSR can change your nation, Says Dr. Bhaskar Chatterjee

In the Developed countries, CSR is linked to the strategic interests of the companies which are undertaking CSR. It has absolutely no connect, anywhere on the horizon, with any kind of national endeavour.

NEW DELHI: As we usher in the first issue of the India CSR Leadership Interview Series on a crisp New Year morning,  it gives us great pleasure to bring to our reader the views of Dr. Bhaskar Chatterjee, the man who is known as key leader in CSR in India. Enjoy the Interview and wishing everybody a wonderful Year ahead, filled with good thoughts, deeds and promises. (Editor). Edited Excerpts:

What does CSR mean to you?

Well, for me, CSR means primarily something that is linked to the development of my country and my nation. My principal belief is that India can do much better on many of its social parameters and that can only come about if, along with everything that the Government does, the Private sector is also brought into the picture. There is so much vitality, so much energy, so much innovation in our Private sector and if we can harness some of that through our CSR process and help it to complement and supplement what the Government is doing, then we can seriously upscale and update all our developmental efforts. That will happen if there is a robust CSR platform on which the Private sector comes together along with civil society and believe that this is a national endeavour, in which they can play a very serious and major role. My belief is that if that happens, then CSR in India will act as a benchmark for the rest of the world to emulate.

In what ways is Indian CSR different from the CSR in the developed countries like Europe, USA?

In the Developed countries, CSR is linked to the strategic interests of the companies which are undertaking CSR. It has absolutely no connect, anywhere on the horizon, with any kind of national endeavour. It is about internalizing CSR into the business of the company. CSR is an addition or an adjunct to their business and strategic interests. To me, that is the fundamental difference.

Here, in India, the way we are looking at CSR is to delink it from the pure strategic interests of the company. There may well be many benefits that the Company derives from doing CSR. But, they are, to me still supplementary or secondary to the principal goal of linking it with national development. Once you differentiate the two, you understand the difference between the Indian model of CSR which is strongly national and development-oriented  and the CSR in the US and in Europe, where it is driven by the business and strategic interests of the company.

You have brought in the concept of ‘accountability’ and ‘ownership’ in CSR. What compelled you to do so?

These two are vitally important in the whole chain. When you raise CSR to the level of the Board and you make accountability a Board level Accountability, then it becomes something of real importance to the Company. Unless the Company ascribes that level of importance to CSR, it will never get done in the way that I dreamt of or envisioned it. For me, from Day 1, there was a need to elevate CSR decision making to the very highest levels of the Company so that the best minds in the Company would work on how CSR can be done.

The best minds are in the Board. Accountability rests with the Board; and not just satisfied with that, we developed this idea of the CSR Committee in which, there would be an Independent Director, who would then be able to bring that level of thinking, that level of commitment and also allow the Board to work with freedom from external pressures. The Independent Director allows external pressures to be absorbed, keeps the Company with its nose close to what the CSR goals of the Company are and is able to drive it in the right direction.

Once that level of Accountability is brought in, it runs right down to the last person standing in the company. The culture of doing CSR, and doing it well, and doing it for a national purpose, seeps in when it is Board-driven. When you have that kind of Accountability, then things also become transparent. What the Board does and what the CSR committee puts up to the Board then gets its approval right from the CEO to every member of the Company. CSR thus becomes Board-driven, leadership-driven and very transparent. Everyone knows what it is that the Company is doing with and for CSR. So, accountability and transparency go hand in hand and that was the reason why the Act and the Rules are so clear about how CSR should be done in a Company.

Tell us something about the Chatterjee Model.

That is a good question. There are three or four things that are important in the way that I looked at them. One was how much did you spend? And, I keep asking myself through all of this time, Why this essential question was never asked? Why wasn’t it the first question that you would ask a Company about its CSR? Why was it always the most closely guarded secret in the company? And it mystifies me to this day: everyone knows and the golden management principle or rule is: What is not measured is not done or at least not done well? and the golden rule of measurement in most things that companies or individuals or anyone does is: what was the budget? Out of that budget, how much did you spend? And that’s the way it works across every single spectrum except CSR. Why? To me, the soul searching question began there. I had many opponents of course, who did not like the way we thought about it. But, I stuck to my guns. To me, this was the fundamental question. So, I think, at the heart of the Chatterjee Model is this.

The other two important characteristics are of course, the links: national development (about which I have already spoken) and the role of civil society. Ours is the only CSR model in the entire world where civil societies are brought right into the very heart of how CSR is supposed to be done. The execution by people, by organisations who are at the grassroots, who live with people and their needs, who understand them best, who understand their psyche, their requirements, can help CSR to make a difference in their lives.

Thus, CSR is best energised with really good NGOs, civil society organisations, and non-profits  who can alleviate the problems of the poor. At the heart of all this CSR, lies the poor, the marginalised, the deprived. Once you bring them into the centrality of everything that you do in CSR, then CSR is raised to a whole new level altogether and for me, that really is the bottom line.

On analysing the CSR report for the Year 2014-15, we find that some of the regions in India are over served, while some are underserved of CSR interventions. How can we bridge this gap?

Yes, the observation is correct. In fact, it came around as a result of the study undertaken when I was in IICA. In our study of the sample that we had collected, we saw that areas particularly in the North East were considerably underserved because most corporates above the threshold prescribed in the law, are actually located in the western and southern states of the country. And, well I suppose it is natural that they tend to do and feel more comfortable to embark on their CSR activities in or around the terrain that they know well. So, it is not that unexpected. And, there are also not many profit making companies located in the North East. So, there is this element of imbalance in where CSR spend takes place.

Now, we do have a legislation in place and it is difficult to tweak it at short intervals. Maybe,  three or four years down the line, we could take a call where we could incentivise CSR activities in those areas where we find (with the data of at least 3 years) that CSR funds have not been going adequately. If we can incentivise the spending of CSR funds in those areas through laws, or through delegated legislation( that is rules), I think, we could take a step forward in that direction.

Where is the Indian CSR headed in the years to come?

Well, I am very optimistic. The financial years 2014-15, 15-16 allowed Companies to settle down; it allowed companies to come to grips with the new laws, new regulations; it allowed them to begin to feel that CSR was not the monster that they had thought it would be. It allowed them to believe that yes, CSR could work in the Company’s favour and that, doing CSR would elevate the belief threshold, the moral values, everything in the eco-system. And, of course, it’s brand value as well. And, today, as this idea is sinking in, you hear a lot of Corporate Leaders saying that, we are, not just in the Company, but also, personally committed to CSR because that’s the aspect we believe in. We want to do something really good in our CSR domain. It gives us a feeling of doing and being good. So, it heightens the moral sense of the Companies, the belief that they are giving back to society much of what they take out of it and in that sense, this year has been a turning point.

From FY 2016-17, we will see much better results as corporates come to grips and understand how impact-making implementation will happen. More and more I think, FY 2016-17 and year thereafter, will tell us what is the impact that CSR is making. Is it making the impact that we hoped it will make? There will be more, as we are told, impact assessments coming forward. Companies will want to know what transformations did they bring about with the CSR spend and greater awareness of how to make CSR really work, as I said for the poor, the marginalised, the disadvantaged … that belief will sink in and they will refine their methods, bring in more innovations, more energy, more drive, more leadership into their CSR efforts. And that, of course will not only help the company, the poor, but the nation as a whole.

As the ‘Father of CSR in India,’ what would be your advice to the CSR Leaders in India?

Well, to put my advice very briefly and succinctly: Believe in what you do. Believe that CSR can change your nation. Believe that CSR can help the poor, the marginalised and those, whom you would otherwise, never get a chance to serve. Believe that in doing this, doing something that is exceptional, that is unique, at the end of the day, is good for you, good for the company and good for the nation.

About Dr. Bhaskar Chatterjee

Dr. Bhaskar Chatterjee is widely acclaimed as the Father of Corporate Social Responsibility (CSR) in India. He was instrumental in framing and issuing the CSR guidelines for Public Sector Enterprises (PSEs) in April, 2010. Thereafter, he played a major role in the inclusion of Section 135 in the Companies Act of 2013 and in the framing of the rules thereafter. As the DG & CEO of the Indian Institute of Corporate Affairs (IICA), he spearheaded the National Foundation for Corporate Social Responsibility (NFCSR).

He has spoken and lectured on the subject of CSR at a very large number of National and International fora over the last five years and is acknowledged as the primary force for bringing a new paradigm to the realm of CSR and providing it with an innovative and strategic vision. Dr. Chatterjee is also a widely acclaimed management practitioner, theorist and teacher. He has written and lectured over many years on issues of social and sustainable development, corporate responsibility and human resources.

Dr. Chatterjee has most recently authored his latest Book entitled “Sustainable Futures – Imperatives For Managing The Social Agenda”. In this book, Dr. Chatterjee shows how governments, corporates and civil society organizations can synergize their efforts to build a whole new paradigm of development that is sustainable, humanistic and inclusive.

About Nayan Mitra

Ms. Nayan Mitra comes with a rich mix of diverse professional experience of over sixteen years. She straddles seamlessly between academics, social and corporate sectors. As a Developmental Consultant and Researcher, she works closely with some of the eminent Corporations and not-for profits of India as well as being in their Advisory and Board level. She has conducted several social researches for multi-lateral agencies; the findings of which have become important bases for sustainable action. She has been a resource person in eminent Institutions of higher learning in the areas of CSR and Corporate Governance and has important peer reviewed research publications to her credit in national and international Academic journals and books as well as delivered at key Conferences. Her book, ‘Corporate Social Responsibility in India: Cases and Development after the Legal Mandate’ alongwith co-editor Dr. Rene Schmidpeter is a first book of its kind that charters the development of mandated Indian CSR from a multi-stakeholder perspective, bringing in over 15 authors. She was a finalist of the prestigious Chevening Gurukul Scholarship for Leadership and Excellence – 2013, as conferred by the Foreign and Commonwealth Office (FCO) of the British Deputy High Commission.

Disclaimer: The thoughts captured in the interview is solely that of the interviewee. The views expressed by the author in this feature are entirely her own and do not necessarily reflect the views of India CSR and editor.

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