Corporate Social Responsibility in India

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Several major CSR initiatives have been launched in India since the mid-1990s.

Corporate Social Responsibility (CSR) has been on the agenda in India for a considerable period. Most big Indian corporations are engaged in some CSR activities. As is the case in many countries, the private sector is generally more active in this area than the governmental/public sector.

Several major CSR initiatives have been launched in India since the mid-1990s. Among these is the first voluntary code of corporate governance, “Desirable Corporate Governance: A Code”, established in April 1998. This was an initiative by the Confederation of Indian Industry (CII), India’s largest industry and business association.

National Foundation for Corporate Governance (NFCG)

A National Foundation for Corporate Governance (NFCG) has been established by the Ministry of Corporate Affairs. This is a partnership with the Confederation of Indian Industry (CII), the Institute of Company Secretaries of India (ICSI) and the Institute of Chartered Accountants of India (ICAI). The purpose of the National Foundation for Corporate Governance is to promote better corporate governance practices and raise the standard of corporate governance in India towards achieving stability and growth.

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Legislation authority in India is shared between the Central Government and the State Governments. Some laws, such as those regulating minimum wages, differ from state to state. Likewise, the implementation and supervision mechanisms may vary between states.

Child Labour and Right of Organization

India is member of the International Labour Organization, and has ratified 40 of the ILO conventions. However, India has not ratified four of the ILO core conventions:

* 087 Freedom of Association and Protection of the Right to Organize (1948)
* 098 Right to Organize and Collective Bargaining (1949)
* 138 Minimum Age Convention (1973)
* 182 Elimination of the Worst Forms of Child Labour (1999)

India’s domestic law on child labour, Child Labour (Prohibition and Regulation) Act (1986), ban employment of children in some dangerous occupations, such as factories and mines, and regulate the working conditions in others.

According to this law, anyone above the age of 14 will be regarded as an adult and will not protected by the child labour regulations.

According to UNICEF, insufficient attention has been given in India to eliminate the worst forms of child labour. The 1986 child labour law does not cover children in all sectors. India has the world’s highest number of child labourers under 14 years.

Labour Laws

India has altogether ratified 333 labour laws. The ways these laws are supervised and implemented, vary. Sub-contracts are common in India. One challenge is that 90% of the Indian labour is in the informal sector, which is not protected by the labour regulations.

Most Indian states have enforced an act for minimum wages for labourers in scheduled employment, as stipulated in the Minimum Wage Act from 1948. However, the minimum wage is often not paid. According to ILO, labour under minimum wage is considered a form of forced labour. According to ILO estimates, there are more than one million forced labourers in India, particularly in the southern part. Many of these are children.

India was in 1976 the first country in the South Asian region to enact legislation against bonded labour.

Contract labour in India is another complex area. The contract workers do not get the same protection and benefits as permanent workers. Many work as contract labour for longer periods of time. Although the ILO Conventions related to forced Labour have been ratified, certain forms of bonded labour still persists, especially in the informal sector.

India has enacted legislation that prohibits discrimination due to gender, religion, ethnicity or caste. Again, the record of implementation is varied. ILO has observed some violations in India’s implementation of the Discrimination (Employment and Occupation) Convention, (No 111, from 1958). This convention obligates the state parties to hinder discrimination due to e.g caste or gender, such as different salary scales and labour conditions.

The Environment 

The main law on environment and production is The Environment (Protection) Act (1986). This law gives the central government the authority to protect and improve environmental quality, as well as control and reduce pollution from all sources.

The responsibility for environmental governance is shared between the corporations and the government. Many Indian institutions have come up with voluntary guidelines on environmental friendly practice. Among these is a partnership on voluntary pollution control, developed by the Indian Ministry of Environment and Forests together with the industrial sector. Other initiatives include the Energy Efficient Initiative by the Indian Chamber of Commerce, the Indian Ecomark and the Clean Technology initiative by the Confederation of Indian Industry and others.

With regard to the implementation of environmental laws, a challenge has been lack of knowledge on how to fulfil the laws in practice. There are also weaknesses in the implementation and control mechanisms, The budget and infrastructure for control has not been sufficient, although greatly improved over the last years.

Right to information (RTI) and corruption

In the Transparency International Corruption Perceptions Index in 2008 in was ranked as number 85 out of 180 countries. The biggest problems were found in regards to politics and governance. According to a Global Compact report, there are low levels of government capacity for law enforcement and implementation in India, causing relatively high levels of corruption.

In 2005, Right to information (RTI) act was established, This law gives the general public right to government information, and is meant to promote transparency and responsibility in the work of all governmental institutions.

The introduction of RTI has led to changes in the transparency regarding establishment and implementation of strategies, programmes and laws. It is also opening for access to information in areas where the authorities have left out important aspects, and give the public a possibly to require important information.

RTI is additionally an important tool in regards to environmental management.

Further inquiries

The Norwegian Embassy and Innovation Norway have established a CSR Forum for Norwegian businesses in India, called the NPR Advisory Group. This Forum comprises major Norwegian businesses established in India.