What do you understand by Corporate Social Responsibility
What do you understand by Corporate Social Responsibility
Corporate Social Responsibility :
As per today’s definition CSR (Corporate Social Responsibility) is the concept of managing the social responsibilities towards society and saving the environment.
Following are the activities which can be included by the companies as Corporate Social Responsibilities:
- Conduct activities to destroy extreme poverty as well as the hunger
- Activities to promote education
- Empowering women and promoting gender equality
- Improving mental health
- Ensuring environmental sustainability
- Vocational training for employment
- Business project for society
- Promoting and contributing in Prime Minister’s Relief Fund
- Paying taxes lawfully which will help the society and public figures for the growth etc.
Therefore there are a number of activities for the companies and corporations that can be utilized for CSR.
Earlier this activity had different meanings. CSR has gone through four phases in India.
1. First phase till 1860’s(Charity and Philanthropy) was when merchants used to share a part of their wealth to the society.
2. Second phase during the Independence movement when there was a pressure on industrialists to showcase their dedication towards society. That time it was known as CSR was founded by the father of Nation (Mahatma Gandhi).
3. The Third era was when Jawahar Lal Nehru ji restricted all foreign traders in India as there was risk of East India Company. Hence during this time the Indian public sector was booming and it led to some social development made by corporate sectors.
4. The fourth phase was from 1980 to 2013 where CSR was adopted as a business strategy. Our government allowed investments from foreign and to gain loyalty and importance they did social development.
Now in Recent times any company which has net worth of Rs. 500 Crore or more or a turnover of Rs.1000 crore or more or a net profit of Rs.5 crore or more have to spend minimum 2% of last 3 years average net profit on CSR activities. This norm is Schedule VII of Companies Act 2013. As per SEBI top 500 companies have to show their business responsibility report as part of the annual report. Reports have to be available on the website of the company.
According to Infosys founder, Narayan Murthy, “Social responsibility is to create maximum shareholder value, working under the circumstances, where it is fair to all its stakeholders, workers, consumers, the community, government and the environment.”
Now companies throughout the world are engaged with CSR activities and many of them has earned a great goodwill in the market too.
To take up CSR activities a corporate must first examine the need in the society and in the environment by conducting different ways of peoples’ participation. This may include interacting intensively with local people, hiring agencies as well as company employees to seek their inputs and suggestions. As a result of this, the corporate should be formulating a comprehensive CSR Policy that should suitably inform the design, development, implementation, monitoring, evaluation and reporting of responsive projects and programs.
In short CSR has a positive impact on society.
