CSR Journey: Now the time has come to pull our socks......

There are general notion that companies decide voluntarily to contribute for a better society is known as Corporate Social Responsibility or doing something for environment protection and employ welfare is also considered as CSR. Till Date term CSR is vague and its claim differs. CSR can not only refer to the compliance of environment, human right standards, labor law and social security arrangements, but also to the fight against poverty, unemployment, climate change, natural resources disorder and consumer protection through integration of CSR in business process.

CSR is as old as human batter system. Initially it was in the form of charity, when rich business men use to help the community in the name of God. But during industrial revolution, situation arises where public raised their voices against industrialization. Commercial logging operations together with laws to protect forests, can both be traced back almost 5,000 years. In Ancient Mesopotamia around 1700 BC, King Hammurabi introduced a code in which builders, innkeepers or farmers were put to death if their negligence caused the deaths of others, or major inconvenience to local citizens. In Ancient Rome senators grumbled about the failure of businesses to contribute sufficient taxes to fund their military campaigns, while in 1622 disgruntled shareholders in the Dutch East India Company started issuing pamphlets complaining about management secrecy and “self-enrichment”. In the late 18th century a Scottish philosopher and economist named Adam Smith wrote numerous articles on these subjects, his magnum opus being The Wealth of Nations in which he advocated the concepts of free trade and the free market on which the classic market economy was based. By the 1920s discussions about the social responsibilities of business had evolved into what we can recognize as the beginning of the “modern” CSR movement. In 1929, the Dean of Harvard Business School, Wallace B. Donham, commented within an address delivered at North Western University:

'Business started long centuries before the dawn of history, but business as we

now know it is new - new in its broadening scope, new in its social significance. Business has not learned how to handle these changes, nor does it recognize the magnitude of its responsibilities for the future of civilization.'

By the early 19th Century, new technology saw jobs being created and living standards improving. Unchecked by regulation, businesses flourished and industrialists in Europe and the USA amassed huge fortunes. However few of these wealthy new industrialists were concerned about the wellbeing of their employees, society or the environment. The horrendous conditions under which people worked were documented in the novels of Charles Dickens and inspired radical theorists such as Karl Marx and Friedrich Engels to write about new concepts on labour, socialism and communism. How a company perceives its societal responsibility depends on various factors such as the markets in which it operates, its business line and its size.

In recent years CSR has become a fundamental business practice and has gained much attention from the management of large international companies. They understand that a strong CSR program is an essential element in achieving good business practices and effective leadership. Companies have explored that their impact on economic, social and environmental sector directly affects their relationships with investors, employees and customers.

In the first phase of CSR in India the industrial families of the 19th century were strongly inclined towards economic as well as social considerations. However it was witnessed that their efforts towards social as well as industrial development were not only selfless and religious motives but also influenced by local community, caste groups and political objectives.

In the second phase, during the independence movement, there was increased stress on Indian Industrialists to demonstrate their dedication towards the progress of the nation and society. According to Gandhi, Indian companies were supposed to be the "temples of modern India". Under his influence businesses established trusts for schools and colleges and also helped in setting up training and scientific institutions. The functions of the trusts were largely in line with Gandhi's reforms which sought to abolish untouchability, encourage empowerment of women and rural development.

The third phase of Indian CSR (1960–90) had its relation to the element of "mixed economy", emergence of Public Sector Undertakings (PSUs) and laws related to labour and environmental standards. During this period the private sector was forced to take a backseat. The public sector was seen as the prime mover of development. This period was described as an "era of command and control". The policy of industrial licensing, high taxes and restrictions on the private sector led to corporate malpractices. In 1966 Indian academicians, politicians and businessmen set up a national workshop on CSR aimed at reconciliation. They emphasized upon transparency, social accountability and regular stakeholder dialogues. In spite of such attempts CSR failed to catch steam.

In the fourth phase (1990 to present) Indian companies started abandoning their traditional engagement with CSR and integrated it into a sustainable business strategy. In 1990s the first initiation towards globalization and economic liberalization were undertaken. Controls and licensing system were partly done away which gave a boost to the economy, Signs of which are very evident today. Companies started thinking seriously about CSR and worked in sporadic nature and some in little managed nature. Mostly manufacturing companies started CSR activities to minimize opposition from local community, social activists and other influential group. Due to which competition increased in global open market and most of the big companies adopted CSR as business process, emotional strategy of marketing and a strong tool of PR/IR. In competition rival companies understand the potential and opted CSR on experimental basis.

“CSR is a long term process but benefits are sustainable and perennial.”

 Strong atmosphere has created for CSR after 2005 and intense discussions and steps have started. Government of India also passed the long awaited company bill, which described about CSR obligation for companies. Still the discussions are in full pace worldwide on these burning issues. Now we can say that CSR has entered in advanced stage & next generation and there is no space to escape, though advanced stage has always been complicated and confusing. Company who understand this concept are improving day by day along with sustainable results whereas there are some companies who consider CSR as burden thus they are either quitting or not undertaking CSR in right aspect. Some companies are doing window dressing through CSR and some organization are yet wondering why CSR, what is CSR, how to do, where to do, how much, what is ROI and lots more aspects.

 CSR has gone through many phases in India. For win-win atmosphere, partnerships between companies, community, dealers, suppliers, NGOs/development organisations and the government should be facilitated so that a combination of their skills such as expertise, strategic thinking, manpower and money to initiate extensive social change will put the socio-economic development of India on a fast track and will lead the world on CSR front. All this reflecting/alarming that CSR is in advance stage. Now the time has come to pull our socks.