subject: Corporate Social Responsibility in the perspective of rural growth [print this page] Corporate Social Responsibility in the perspective of rural growth
INTRODUCTION-Some basic aspects of corporate social responsibility
In this age of global competition, corporates are beginning to realize the stake thatthey have, as a part of the society. There is a growing realization that they should contribute to social activities globally with a desire to improve the immediate environment where they work and many companies are taking keen interest in such activities.Companies that pay genuine attention to the principles of social responsibility are also favoured by the publicwho preferto consumetheir goods and services. This has given rise to the concept of Corporate Social Responsibility (CSR) By social responsibility, we mean a doctrine that claims that an entity whether it is state, government, corporation, organization or individual has a responsibility to society. According to Infosys founder, Narayan Murthy, social responsibility is to create maximum shareholders value working under the circumstances, where it is fair to all its stakeholders, workers, consumers, the community, government and the environment'. Commission of the European Communities (2001) stated that being socially responsible means not only fulfilling legal expectations, but also going beyond compliance and investing more' into human capital, the environment and the relation with stakeholders.
India lives in its villages. Literally and from the social, economic and political perspectives the statement is valid even today. Around 65% of the State's population is living in rural areas. People in rural areas should have the same quality of life as is enjoyed by people living in sub urban and urban areas. Further there are cascading effects of poverty, unemployment, poor and inadequate infrastructure in rural areas on urban centres causing slums and consequential social and economic tensions manifesting in economic deprivation and urban poverty. Hence Rural Development which is concerned with economic growth and social justice, improvement in the living standard of the rural people by providing adequate and quality social services andminimum basic needs become essential. India is primarily an agriculture-based country. Agriculture contributes nearly one-fifth of the gross domestic product in India. In order to increase the growth of agriculture, the Government has planned several programs pertaining to Rural Development in India.Corporate Social Responsibility is thus considered very important as far as rural areas are concerned.
CORPORATE SOCIAL RESPONSIBILITY IN INDIAIndian companies are now expected to discharge their stakeholder responsibilities and societal obligations, along with their shareholder-wealth maximization goal. In India as in the rest of the world there is a growing realization that business cannot succeed in a society which fails. An ideal CSR has both ethical and philosophical dimensions, particularly in India where there exists a wide gap between sections of people in terms of income and standards as well as socio-economic status However, the concept of CSR is not new in India. The idea of social responsibility in the Indian society, bounded by notion of caste and fate, dates back to the time of British Rule when Indian reformers launched reform movements which slowly became more socially responsible. During the independence struggle Indian companies, which began to proliferate and proper from the mid 19th century, throw in their lot with Mahatma Gandhi and the resulting concern for the nations caused many of them to be involved in providing education, health service and even clean waterAs part of the survey, over 100 companiesranging from large to mid-sized corporationsresponded to questionnaires sent to around 1,000 companies during September-October 2002. Besides, a group of researchers conducted an in-depth study of CSR programmes in top business houses. The respondents unanimously acknowledged that social responsibility was no longer an exclusive domain of the government and CSR is much more than "passive philanthropyBeyond the private sector, corporate players in India's public sector too have been actively involved in corporate social responsibility initiatives.Most public sector units in the heavy engineering industry have not only set up a township around the plant, but also established a school, a hospital and several other civic facilities for its employees and those that live in that area.Private sector companies have been encouraged to undertake rural development programmes down the years through fiscal incentives by the government. For instance, special benefits are offered in the industrial policy to companies that set up industries in backward areas and tax incentives are also offered to companies that set up water purification projects.
In India, it has also been noticed that when it comes to individual CSR activities, the anonymous' donor mentality prevails. Of course, with the intense spotlight on the subject, the interest in corporate social responsibility is spreading in India as well. The Corporate Social Responsibility Survey 2002India, jointly conducted by the United Nations Development Programme,covering 19 industry sectors reveals that this interest is growing as more and more companies in India are keen to project themselves as good corporate citizens. This was the most important factor driving CSR in India, according to the survey. Good corporate citizenship and CSR initiatives are inextricably linked with improved brand reputation, which is one of the most important drivers of CSR identified by the respondent companies. The other key drivers of Corporate Social Responsibility in India were diverse ranging from stated philosophy of founding fathers to improving relationship with local communities to enhanced shareholder value.
