By Suresh Kr Pramar
Changing expectations about the role of business in society has pushed the concept of good corporate citizenship into the forefront of business decision making. Research studies have revealed that good corporate activities have a positive impact on business performance. Most major companies now recognize that they have an extended family of stakeholders which include investors, employees, non government organizations and the community in which the operate.
Corporates and the Evolution of Social Responsibility
Corporates now realize that for long term survival they need to look beyond just making money for their shareholders and owners and pay heed to the needs of the community. This change in attitude is what Corporate Social Responsibility is all about..
Defining Corporate Social Responsibility
The World Business Council for Sustainable Development defines CSR as “the continuing commitment by business to behave ethically and contribute to economic development while improving the quality of life of the work force and their families as well as the local community and society at large.”
According to another definition CSR involves the “ operations of a business in a manner that meets or exceeds the ethical, legal, commercial and public expectations that society has of business. It is viewed as a comprehensive set of policies, practices and programmes that are integrated through business operations and decision making processes that are supported by top management.”
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Comprehensive Nature of CSR
These definitions reveal that Corporate Social Responsibility is not merely giving funds for community development and religious purposes. It involves a wide range of activities and extends to a wide range of stakeholders of the business. For a company to qualify as a good Corporate Citizen it is essential not only for the top management to be pro CSR but also for an entire workforce of the company to be involved in some way or the other in the Company’s Corporate Social Responsibility activities.
Compliance CSR vs. Values-Led CSR
Mark Goyder, an expert on CSR, in “Redefining CSR” sees a key distinction between what he describes as ‘compliance CSR’ or a more fundamental process that he calls ‘conviction or values-led CSR’. Compliance CSR sees a company undertaking the community programmes, the ethics statements, the environmental management systems purely to keep up with external demands.
Historical Roots of CSR
Western writers would have us believe that Corporate Social Responsibility is a gift of the Western world. This I strongly believe is not the complete truth. Over seventy-five years ago Mahatma Gandhi propounded the concept of Trusteeship as a mid path between pure capitalism and pure communism.
The Role of NGOs in CSR
Why have business and NGOs become major actors in the promotion of social and economic development? One reason is a decline in the role of the nation-state in the context of an increasingly “globalized” international economy.
Changing Dynamics in NGO-Business Relationships
NGOs are seeking new ways to achieve their goals. John Elkington and Shelly Fennell, in “Partners for Sustainability” argue that NGOs have become frustrated in their efforts to improve environmental practices through legislation. Therefore some are attempting to work directly with business to achieve their goals.
CSR in the Indian Context
What Tadashi Yamamoto says about Japan is equally true in the Indian context. Most major corporates in the country are steadily moving into the realm of Corporate Social Responsibility. Rajashree Birla, Chairperson of the Aditya Birla Centre for Community Initiatives and Rural Development, has said “ for us in the Corporate world to expect that the government alone should address welfare issues is both unfair and unrealistic.
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Challenges and Transformations in NGO-Business Relations
Trust is becoming a fundamental driver for partnerships between NGOs and the Private Sector, but there are serious implications for NGOs if a corporate relationship turns sour. Thus NGOs should not be endorsing companies, but engaging with them critically.
Perspectives on Partnership
There is adequate scope for partnership between the private sector and NGOs provided they are able to indulge in give and take. Each needs to soften its stand against the other and be willing to accept each other’s point of view and to respect these views.
Opportunities and Risks in NGO-Business Partnerships
There are both opportunities and risks for both. It is a complicated task – for every benefit there may be an accompanying risk. Making the job more difficult, it may be impossible to be certain of the real risks and benefits until months, even years, into a project. Often, the risks and benefits as perceived at the beginning seemed quite different once the NGO and business had worked together over time. Both sides are only now beginning to develop ways of measuring the effectiveness of partnerships; a number of respondents said more research was needed in this area.
About the author
Suresh Kr Pramar, Speaker, Trainer, Writer, CSR Consultant and the Executive Director, Centre for Training & Research in Responsible Business is a veteran journalist presently actively involved in promoting CSR through He is Managing Trustee, Global Gandhian Trusteeship & Corporate Responsibility Foundation . He is regular contributor at INDIACSR.
