Time to move beyond from traditional Corporate Social Responsibility
Corporate Social Responsibility(CSR) is a corporate initiative to assess and take responsibility for company’s effect on environment and impact on social welfare and to promote positive social & environmental change.
Corporate social responsibility (CSR, also called corporate conscience, corporate citizenship or responsible business) is a management concept whereby companies integrate social and environmental concerns in their business operations and interactions with their stakeholders. CSR is generally understood as being the way through which a company achieves a balance of economic, environmental and social imperatives (Triple-Bottom-Line- Approach), while at the same time addressing the expectations of shareholders and stakeholders.
India is the first country in the world to make corporate social responsibility (CSR) mandatory, following an amendment to The Company Act, 2013 in April 2014. Businesses can invest their profits in areas such as education, poverty, gender equality, and hunger.
Today, obviously, organization’s attachment to great Governance, Social and Environmental (ESG) act is normal and the message of good corporate citizenship has been adopted. Organizations can be sure there will be stakeholders – clients, employees, investors or media – checking they walk the talk.
“The ministry of corporate affairs (MCA) has notified Section 135 and Schedule VII of the Companies Act, 2013, which relate to corporate social responsibility (CSR) that will be effective from April 1, as part of the new Companies Act. The norms will apply to companies with at least Rs 5 crore net profit or Rs 1,000 crore turnover or Rs 500 crore net worth.
These companies will have to spend 2 per cent of their three-year average annual net profit on CSR activities in each financial year.”
CSR is no longer about just caring for global warming. It is rather a broader concept of a business’s overall impact on local communities in culture. Instead a company’s performance is judged in the widest way possible showing how strategic objectives and material topics actually support the long-term creation of value for the business and society at large.
While aiming to earn more & more profit, organizations should also focus on how and from where it is earned. This requires the mindset for many employees in the organization to move away from thinking and acting in quarterly reporting cycles towards long term investments by taking account of their company’s impact on future generation.
Organizations that can demonstrate their business benefit to its stakeholders and society, gain an attracting and retaining talent. Moreover, setting a decent corporate example can motivate others to go for the most highest standards. Also doing business responsibly and with a focus on future generations, has the potential to create deeper relationships with clients by not only becoming more than just a supplier but a valued and trusted business partner.
Some industries purpose can be directly linked to providing better products than others i.e. employment and recruitment sector. It fosters and nurtures conditions where people and companies can develop. For example, By making the access to work easy, recruitment companies can act as social integrators. It provide essential work experience and access to job marketing for youngsters. It provides growth from one job to another or even from one industry to another, for people with a variety of backgrounds, abilities and at any stage of their careers. Through such services, recruitment industry delivers decent and meaningful work, reduces unemployment and allows companies to turn available work into actual jobs also in uncertain economic times.
Corporate Social responsibility (CSR) should not remain a side activity for a business but must move to become an integral part of a company’s business strategy and performance reporting. CSR is not a matter of generous grants and worthy foundations. Companies are defined by what they do, not what they give. Therefore, businesses must increasingly unlock their intellectual assets and the power of their people to gain real traction. That means having a clear, widely understood and shared, purpose which drives prosperity for society at large.