CORPORATE SOCIAL RESPONSIBILITY & INSURANCE SECTOR

R.Venugopal

WHAT IS CSR?
Is it Philanthropy and Charity? Is it social and humanitarian work? Is it protecting the Environment? Is it undertaking public service tasks which normally Govt. should be doing? Or is it all of these? The answer is both YES & NO.
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CSR
The CSR of a company should be undertaking all actions as would maximize the probability of its long-term survival and sustained growth. A company has both direct stakeholders and indirect stakeholders. It also impacts on the external environment.
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STAKEHOLDERS
Direct-all employees, suppliers & vendors, dealers as well as shareholders. Indirect-communities living near the production facility, customers and others whose livelihood could be influenced by the operations of the company. Larger the company, greater the stakeholders.
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MUTUAL INTEREST
It in the mutual interest of both the company and the stakeholders that the company should have long-term sustained growth. Any closure of the company would lead to disruption in the lives of many and cause severe hardship to the weaker among the stakeholders.
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SOCIETAL RESPONSIBILITY
The sustained growth of the industry is a part of the societal responsibility of the company. Shareholder education and the awareness among both the Direct and Indirect stakeholders regarding CSR is also a prime concern of the company.
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I.T.SECURITY
As an insurer, it is his responsibility to establish identity of the customers properly to avoid frauds in claims,security threats and to take care of the recent AML Guidelines. While large amounts are paid as premiums, thro I.T. insurer has to comply with AML Guidelines.
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I.T.SECURITY
In view of Govt.s ambitious plan of extending insurance cover to the people living below poverty line,(there are about 30 cr people in this category),again insurer has to tackle the identity problem with the help of I.T.The necessity for a bio-metric card comes in.
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ENVIRONMENT
All companies have to ensure that their activities do not adversely affect the environment. Depletion of natural resources forests or ground water is a case in point. Recovery of heat or minerals from the gases or effluents reduces pollution.

ENVIRONMENT
Atmospheric pollution affects the health of the people and so must be minimized. Laws relating to the environment should be observed both in letter and spirit. Companies require regular availability of well-educated and trained workers, engineers, management & other professionals.
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ENVIRONMENT
Thus getting involved in improving educational and training institutions, relevant to the company, serves both as CSR and promotes long-term business interests. The same argument applies to programs undertaken to improve the quality of life of people living nearby.
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ENVIRONMENT
Many actions like the following help brand building: Maintaining traffic roundabouts Maintaining parks for children & elderly Advertising for socially important causes Promoting road safety Taking village development projects

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ENVIRONMENT
Promoting research in areas important for rural development Promoting action by citizens in areas which are better for the environment or society. These kind of activities help in building a positive image and encouraging social involvement of the companys employees who in turn develop a sense of loyalty.
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FOUNDATIONS
Many Corporate float separate ventures called Foundations to conduct CSR Projects instead of doing themselves directly. INFOSYS Foundation, WIPROS Foundation BILL MELINDA GATES Foundation etc. LIC GOLDEN JUBILEE Foundation.

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LIC-GJF
This was established on 20-10-2006 and it commenced its activities from March 07. The Foundation has been created with an initial corpus of Rs.50 cr.with the provision that Rs.10 cr. Will be infused every year for the next five years taking the total corpus to Rs.100 cr.

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LIC-GJF SUPPORTED PROJECTS

Infra-structure support in the field of education: Marudyan Primary & Junior High School, Dhanpota, Kolkata. Learning Centre, SOS Children Village-Latur-Aurangabad. Learning Centre, SOS VillageShillong.
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LIC-GJF PROJECTS
Navjeevan Centre, Kalyan. Tinisuti Bima School, Gauhati. Govt.Upper Primary School, BheemanadErnakulam. Sai Vivekanand Vidyalay, Chennai. Sr.Secondary School, Surani-Shimal. Sewa Bharti, Bhopal. Anand Kendra, Gwalior.
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LIC-GJF PROJECTS
Golden Jubilee Scholarship awarded to 36 visually impaired children with the National Association for the Blind, Mumbai- in the shape of Braille Books, Special Teachers and other aids. In the area of Health and sanitation: A mobile van Dispensary-fully equipped to the Peoples Welfare Society-Allahabad.
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LIC-GJF PROJECTS
A mobile Dispensary van to Ramakrishna Math, Kochi. Another such van to Social Welfare Project, Totopara, Jalpaiguri. 5 Cochlear Implants sanctioned to children belonging to weaker sections at the KEM Hospital, Pune.
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LIC-GJF PROJECTS
Distributed Computers, Hearing Aid Machines, Cots, Sewing Machines, Audio graph Machines, Wheel chairs etc. at different Centers. Supported NGOs who are working in the remotest villages of North-east, in the Tribal areas of Kangra District-Himachal Pradesh & far-flung villages of Kerala.
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BHARTI-AXA LIFE INS. CO

This company has launched its CSR Prog.-Bharti AXA Life Hearts in Action. This is aimed at benefiting underprivileged children across India. Their employees are volunteering to spend their time with over 1000 needy children at the four Metros.
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BHARTI-AXA-CONTD.
These employees will be visiting the homes, cheering the children thro games and gifts and also help them acquire new skills that could be of use to them in their future lives. The company will also offer monetary contribution towards the education of these children.
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INSURERS ROLE
Insurance company has corporate social responsibility towards improving the environment, but at the same time, the company has to garner good premium as ultimately the insurer has to earn profits for its shareholders & stakeholders.
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INSURERS ROLE
The company can earn profits only when there are less early death claims and more maturity claims. When the insurer starts insuring the poor slum dwellers as per the directives of IRDA, it becomes its concern to improve the conditions.
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INSURERS ROLE
In metropolis, we have the spectacle of both plenty and poverty living together-a sky scraper adjoined by a dirty slum full of unsanitary conditions and filth. I give the suggestion: When the people of such a locality take insurance policiescontd.
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SUGGESTION
The insurer assesses the area and rates it as A, B, C or D depending up on the cleanliness, whether the industrial waste is discharged in to the stream, whether the Govt. hospitals are well maintained and how are the other civic amenities.Depending on the rating the premium is charged for all.
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SOCIAL AWARENESS
This will awaken the customers who would persuade the municipal authorities, police and industrialists and they will take up the issues and improve the environment.When that happens, the premium too gets reduced in the next year.The insurer also donates a part of the premium.
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CSR
Thus the insurance companies become the Inspectors and the IRDA the watchdog. Sanitation, garbage collection and disposal, effluent management, pollution control and environment Improvement are some of the areas to be concentrated.
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CLEANLINESS IS GODLINESS
How long we are going to wait looking at the Govt? While we feel unhappy when a foreigner wins Oscar Awards portraying our abject poverty, what steps we have taken to remove those irritants in our country?
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MR.MUKESH AMBANIS CALL

The above top Industrialist has mentioned the following while addressing the International Bar Association at the conference-Taking India to the next Millennium-at Mumbai on March 6, 2009 as reported by the Economic Times dated March 9, 2009:
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MR.MUKESH AMBANIS CALL

Eradicating poverty lies with all of us.Its not fair to hold only the Govt. or the Industry responsible for it.Going forward, the responsibility lies with civil society, which means all of us.Everybody should get an equal opportunity,quality of life,health and education.
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GOOD CORPORATE CITIZEN

A reasonable requirement for any company that wants to call itself a good corporate citizen ought to be to spend at least 1% to its previous years pre-tax profit for philanthropic purposes. Some companies are clearing more than this-TARGET and GENERAL MILLS of U.S.

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NEED OF THE HOUR

We need a cadre of self-motivated and sensitive CEOs to lead the way. We need men and women who will match actions with words by carrying out combined corporate contributions and community-related initiatives that are supported by adequate resources and time ,rather than by more chest-beating ad campaigns and press releases.
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ICAI RULES
The Institute of Chartered Accountants of India(ICAI)- a Statutory Body in India that sets accounting & Auditing Standards for the Corporate Sector, is working on a new set of Rules on CSR, making it a must for Companies to report on social, environmental and economic initiatives.
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ICAI RULES
This has assumed importance in the backdrop of accusations that many companies realize growth at the cost of environment and the society at large. For example, despite legal interventions lifeline rivers like the Yamuna and the Holy Ganges have fallen prey to waste from factories.
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ICAI RULES
Many Indian Companies have lost big orders from overseas clients after being accused of employing child labor. Be it in the Paper Industry, soft drink or automobile many companies have come under scanner for exploiting environment for benefits.
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CSR-A GLOBAL VIEW

Insurance Companies are the major contributors in U.S.on the charitable contributions in 2006, as per a survey. They have paid 147 million dollars out of the total 10.21 billion dollars. Insurers also occupied a position among the top 20 donors in international scene.

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CSR- A GLOBAL VIEW

The five largest insurance company corporate Foundations are: MetLife Foundation The Prudential Foundation The State Farm Companies Foundation The Allstate Foundation Nationwide Foundation.

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CSR-A GLOBAL VIEW

The Insurance companies invest in helping to fund the building of roads, schools and other public projects. They provide businesses with capital for research, expansions and other ventures thro their investments in corporate equities and bonds.
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