Is there a need for more engagement?

CSR can certainly impact reputation and offers an opportunity for businesses to promote, improve communities and empower them. But plenty of communities in India are crying out for more engagement. The question is – are companies doing enough for CSR?

Since the Companies Act 2013 and its amendment in April 2014 mandated a segment of companies in India to carry out CSR activities and spend 2% of their profits on this exercise, a lot of companies are still in the process of understanding and implementing this directive. A lack of effective monitoring and execution also add to the lacunae in the enactment of the Act.

Most companies perceive CSR as a compliance necessity to meet the requirements of the 2014 rules. There is also the perception of CSR as a standalone philanthropic initiative and not one integrated into the business strategy. CSR is perceived as a brand value enhancing machinery, which is the only return on investment that can be extracted as any other business return from a CSR investment does not qualify as per the rules.

While there have been a number of companies that have been driving CSR initiatives even before the mandate, they were a handful of activities that were driving change and were being measured for impact. While there is intent, it is currently misplaced or misdirected and there is a gap between the corporate sector and the Civil Society Organisations from a need versus opportunities viewpoint.

Companies should understand that CSR activities need investment of time and resources; it should be planned as any business project is, with resources, timelines and measurable outcomes with mandated pro-bono hours that employees put in. A donation or a one-off activity or event is not construed as CSR; engagement and execution are vital to creating positive impact.

Efforts are needed in sensitising employees, top leadership and stakeholders alike to the concept of CSR and what it entails. The journey has just started for a lot of companies and while it is work in progress, the good news is, the headstart has been made, but there is still a long way to go.


One clause in the Companies Act 2013 that has generated widespread debate and dialogue among corporates, is the mandate that businesses above a certain size, spend 2% of their profits on CSR. The result: many companies structured their CSR programmes better, reinforced their processes, chose causes more thoughtfully and incorporated systems to make their projects quantifiable.

Today, there is a renewed focus on CSR that corporates are gearing up for – one such being engaging, empowering people and communities, which undoubtedly, is going to be the only way to operate. With a longterm association, it is important to assist the local people with their development, as we ultimately, owe it to them. Besides, doing business in the community is also fulfilling and rewarding. No company can think of long-term sustainable business operations without considering surrounding communities.

Community-led CSR has several positive benefits: provides businesses a platform to achieve a positive impact on communities, enhances value creation by integrating business into communities, solves many manpower related issues by generating meaningful employment opportunities, addresses the issues related to local economic-political environment and boosts corporate equity and corporate citizenship objectives. Keeping communities in mind, we at Welspun Group have focused our CSV (Corporate Social Value) initiatives on 3Es ie: Education, Empowerment and Environment & Health.

What is more crucial while designing a CSR programme, is a better assessment of your stakeholders, analysing their needs and aspirations to create an action plan, that can run for several years. Along with the 2% investment, companies should look at committing 2% of their senior management’s time to the CSR initiatives and this should be driven top-down. Also, employees need to be encouraged to whole-heartedly participate in the CSR programs. This will give them an opportunity to contribute their time and talent to bring about a sense of purpose in their own life.

 

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Reputation Today is India’s only print magazine for Public Relations and Corporate Communications professionals. It is the official magazine of PRAXIS - India’s largest offsite summit for Public Relations and Corporate Communications.

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