The government as an implementation agency will become directly responsible for any failure while not being able to deprive any praise for the programme. Universally it is commonly understood that government has strengths in conceiving programmes but is weak in implementation. Our five year plans are a very strong example.
By Suresh Kr Pramar
There is growing concern among business houses, across the country, over the Chhattisgarh government’s move to mandate Corporate Social Responsibility. On the basis of the scrappy details, publicly known, it would seem that the state government wants to act as the implementer of schemes. They would like business houses to deposit their CSR funds with the District Collector’s office and in most cases implement programmes they decide are required.
Corporate Social Responsibility Definition
Corporate Social Responsibility, according to a definition by the World Bank, is “the commitment of business to contribute to sustainable economic development, working with the employees, their families, the local community and society at large to improve their quality of life, in ways that are both good for business and good for international development.” CSR is the commitment/responsibility of business to its stakeholders, including the community, employees, consumers, suppliers, environment etc.
Voluntary Nature of CSR in India
In India, as elsewhere in the world, CSR is voluntary with business reserving the right to select the programmes it would like to sponsor and to implement the same. The National Voluntary Guidelines on Social, Environmental and Economic Responsibilities of Business, issued by the Ministry of Corporate Affairs also says that CSR is Voluntary. What is mandatory in the Guidelines is the reporting on its CSR activities.
Misconceptions about CSR
A common perception about CSR is that its starts and ends with community service. That if business undertakes community development works its responsibility under CSR is fully met. This is a wrong interpretation of the CSR. CSR covers a whole gamut of activities which are involved in the management of business. Starting from stakeholder engagement and management, it covers relations with the supply chain, consumer and customer relations, labour relations, corporate governance, Human Rights, environment etc.
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Business Responsibility and Government Involvement
All activities under CSR should rightly be handled by the business and its employees, with or without a partnership with civil society organizations. Handing over its responsibilities, even partially, to the government or bureaucracy would weaken the CSR Agenda and deny the company its rightful standing among the stakeholders. When government enters the picture the company would have shed its responsibility for the programme.
Government’s Strengths and Weaknesses in Implementation
The government as an implementation agency will become directly responsible for any failure while not being able to deprive any praise for the programme. Universally it is commonly understood that government has strengths in conceiving programmes but is weak in implementation. Our five year plans are a very strong example.
Community Investment as Part of CSR
Community Investment is a part of the overall CSR concept. Spending money without proper planning and implementation is not what CSR is all about. A company launching itself on the path of CSR needs to go through many stages of planning. It is only after it has got all its nuts and bolts of the programme in place can the company embark on the implementation of the programme.
Stakeholder Consultation in CSR
The first stage of the programme starts with stakeholder consultation. This involves discussion with the various stakeholders, including the community, employees etc. who have been impacted or will be impacted by the presence of the industrial unit. This itself is not a very easy process and involves considerable patience and understanding.
Importance of Employee Involvement
Company representatives need to be skilled in identifying the right stakeholders and their demands. They will have to scan through the many demands by different stakeholders and draw up a list which satisfies a majority of the stakeholders. To ensure that the list contains demands of the largest number all stakeholders will have to be allowed a free say without inhibitions or fear.
Implementation Process and Employee Role
Once the list has been finalized the implementation process should be initiated by the company. The company can implement the project through its own employees/CSR team or involve an NGO having the expertise to undertake the project. Involvement of the company is essential for several reasons. There are several advantages in using employees in the implementation of the projects.
Employee Involvement in CSR Projects
Employees are not only the face of the company but the hands and feet as well. The potential impact of a company’s CSR programme is directly proportional to the participation of its employees. Employees often can serve as “ambassadors,” helping the company to understand what the community needs and wants (and what it does not want) and helping to explain the positive intention of the company to the community. Employee involvement provides an effective strategy with which to address often negative or at best suspicious relationships that exist between business and society.
Role of Employees in Identifying Issues
Using employees to implement CSR projects is critical because they can help define how the program is implemented by identifying local issues, opinion leaders, and opportunities. But an even more valuable role is that they are closest to, and therefore able to identify, the impediments whether they be cultural, religious or rooted in the existing official and unofficial power structures. If a company wants to win the battle for hearts and minds, they’ll do it by actively engaging their employees and treating them as the heart of their success.
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Business and Social Responsibility
Becoming a social reformer is not the role of business. They are in the game to make money. However, business can no longer just make money and ignore their impacts on the stakeholders. More and more companies are realizing their responsibility towards the community and the different stakeholders. Hence Community Investments.
Role of NGOs in CSR Implementation
Employees cannot be expected to become fully involved in implementing the Company’s CSR projects. At best they can provide the much-needed expertise in various aspects of implementation. Companies will have to turn to NGOs for the actual implementation of the programme. Company employees could help by providing expertise as and when required. NGOs because they are grassroots workers are close to the community and can identify their needs.
Importance of Trust in Implementation
Successful implementation of any programme requires the generation of trust between the beneficiaries and the fund providers. Surveys across the world show that NGOs enjoy more trust among the people than business and government. In India, there is a general lack of trust in the governments, states, or central. Most people have a very poor opinion of the implementation capability of the government. At best the government and its apparatus can be the touch bearers provide the path to implementation rather than taking on the role of the implementer. Governments should set the rules and provide wider social aims.
Chhattisgarh Government’s Concerns
The government of Chhattisgarh has reason to be concerned about the lack of active CSR by companies in the state. However, the move to take over the implementation of the programmes is not the right solution. This move is likely to earn the government more brickbats than bouquets since the ball will fall in their courts if the programmes are not implemented to the satisfaction of the beneficiaries or if there are elements/scent of corrupt practices.
About the author:
Suresh Kr Pramar, CSR Educator, Trainer, Writer and Consultant is the Executive Director, Centre for Training & Research in Responsible Business and a veteran journalist presently actively involved in promoting CSR through his publication CRBiz and by conducting workshops, in-house training programmes and providing Consultancy on Corporate Social Responsibility and Sustainability. He is a regular contributor to INDIACSR.
