Corporate Social Responsibility(CSR)

UTKARSH ARYAN
20BBA005
BBA(6th sem)
Corporate Social Responsibility
 Corporate social responsibility (CSR) is a self-regulating business
model that helps a company be socially accountable to itself, its
stakeholders, and the public. By practicing corporate social
responsibility, also called corporate citizenship, companies can be
conscious of the kind of impact they are having on all aspects of
society, including economic, social, and environmental.
Corporate Social Responsibility is a business approach companies
follow to make a social impact and focus beyond profits. Its main
purpose is to enhance the company’s image, earn customer loyalty
and generate more sales. It also benefits society and the
environment as businesses work for the collective good.
 Corporate social responsibility is a broad concept that can take
many forms depending on the company and industry. Through
CSR programs, philanthropy, and volunteer efforts, businesses can
benefit society while boosting their brands. For a company to be
socially responsible, it first needs to be accountable to itself and
its shareholders. Companies that adopt CSR programs have often
grown their business to the point where they can give back to
society. Thus, CSR is typically a strategy that's implemented by
large corporations. After all, the more visible and successful a
corporation is, the more responsibility it has to set standards of
ethical behavior for its peers, competition, and industry.
 Types of CSR:
Although corporate social responsibility is a very broad concept
that is understood and implemented differently by each firm, the
underlying idea of CSR is to operate in an economically, socially,
and environmentally sustainable manner.
Generally, corporate social responsibility initiatives are categorized
as follows:
1. Environmental responsibility
2. Ethical responsibility
3. Philanthropic responsibility
4. Economic responsibility
1. Environmental Responsibility
Environmental responsibility is the pillar of corporate social responsibility rooted
in preserving mother nature. Through optimal operations and support of related
causes, a company can ensure it leaves natural resources better than before its
operations. Companies often pursue environmental stewardship through:
Reducing pollution, waste, natural resource consumption, and emissions through
its manufacturing process.
Recycling goods and materials throughout its processes including promoting re-
use practices with its customers.
Offsetting negative impacts by replenishing natural resources or supporting causes
that can help neutralize the company's impact. For example, a manufacturer that
deforests trees may commit to planting the same amount or more.
Distributing goods consciously by choosing methods that have the least impact on
emissions and pollution.
Creating product lines that enhance these values. For example, a company that
offers a gas lawnmower may design an electric lawnmower.
2. Ethical Responsibility
Ethical responsibility is the pillar of corporate social responsibility rooted
in acting in a fair, ethical manner. Companies often set their own
standards, though external forces or demands by clients may shape ethical
goals. Instances of ethical responsibility include:
Fair treatment across all types of customers regardless of age, race,
culture, or sexual orientation.
Positive treatment of all employees including favorable pay and benefits in
excess of mandated minimums. This includes fair employment
consideration for all individuals regardless of personal differences.
Expansion of vendor use to utilize different suppliers of different races,
genders, Veteran statuses, or economic statuses.
Honest disclosure of operating concerns to investors in a timely and
respectful manner. Though not always mandated, a company may choose
to manage its relationship with external stakeholders beyond what is
legally required.
3. Philanthropic Responsibility
Philanthropic responsibility is the pillar of corporate social
responsibility that challenges how a company acts and how it
contributes to society. In its simplest form, philanthropic
responsibility refers to how a company spends its resources to
make the world a better place. This includes:
Whether a company donates profit to charities or causes it
believes in.
Whether a company only enters into transactions with suppliers or
vendors that align with the company philanthropically.
Whether a company supports employee philanthropic endeavors
through time off or matching contributions.
Whether a company sponsors fundraising events or has a presence
in the community for related events.
4. Financial Responsibility
Financial responsibility is the pillar of corporate social responsibility
that ties together the three areas above. A company make plans to be
more environmentally, ethically, and philanthropically focused;
however, the company must back these plans through financial
investments of programs, donations, or product research. This includes
spending on:
Research and development for new products that encourage
sustainability.
Recruiting different types of talent to ensure a diverse workforce.
Initiatives that train employees on DEI, social awareness, or
environmental concerns.
Processes that might be more expensive but yield greater CSR results.
Ensuring transparent and timely financial reporting including external
audits.
Benefits of Corporate Social Responsibility :
As important as CSR is for the community, it is equally valuable for a
company. CSR activities can help forge a stronger bond between employees
and corporations, boost morale, and aid both employees and employers in
feeling more connected to the world around them. Aside from the positive
impacts to the planet, here are some additional reasons businesses pursue
corporate social responsibility.

Brand Recognition
According to a study published in the Journal of Consumer Psychology,
consumers are more likely to act favorably towards a company that has acted
to benefit its customers as opposed to companies that have demonstrated an
ability to delivery quality products. Customers are increasingly becoming
more aware of the impacts companies can have on their community, and
many now base purchasing decisions on the CSR aspect of a business. As a
company engages more in CSR, they are more likely to receive
favorable brand recognition.
Investor Relations
In a study by Boston Consulting Group, companies that are
considered leaders in environmental, social, or governance matters
had an 11% valuation premium over their competitors. For companies
looking to get an edge and outperform the market, enacting CSR
strategies tends to positively impact how investors feel about an
organization and how they view the worth of the company.

Employee Engagement
In yet another study by professionals from Texas A&M, Temple, and
the University of Minnesota, it would found that CSR-related values
that align firms and employees serve as non-financial job benefits that
strengthen employee retention. Works are more likely to stick around
a company that they believe in. This in turn reduces employee
turnover, disgruntled workers, and the total cost of a new employee.
Risk Mitigation
Consider adverse activities such as discrimination against employee
groups, disregard for natural resources, or unethical use of company
funds. This type of activity is more likely to lead to
lawsuits, litigation, or legal proceeds where the company may be
negatively impacted financially and be captured in headline news. By
adhering to CSR practices, companies can mitigate risk by avoiding
troubling situations and complying with favorable activities.
ISO 26000
In 2010, the International Organization for Standardization (ISO)
released ISO 26000, a set of voluntary standards meant to help
companies implement corporate social responsibility. Unlike
other ISO standards, ISO 26000 provides guidance rather than
requirements because the nature of CSR is more qualitative than
quantitative, and its standards cannot be certified.
ISO 26000 clarifies what social responsibility is and helps
organizations translate CSR principles into practical actions. The
standard is aimed at all types of organizations, regardless of
their activity, size, or location. And because many key
stakeholders from around the world contributed to developing
ISO 26000, this standard represents an international consensus.
Why Should a Company Implement CSR Strategies?
Many companies view CSR as an integral part of their brand image, believing
that customers will be more likely to do business with brands that they
perceive to be more ethical. In this sense, CSR activities can be an important
component of corporate public relations. At the same time, some company
founders are also motivated to engage in CSR due to their convictions.

Why Is CSR Important?

The movement toward CSR has had an impact in several domains. For
example, many companies have taken steps to improve the environmental
sustainability of their operations, through measures such as installing
renewable energy sources or purchasing carbon offsets. In managing supply
chains, efforts have also been taken to eliminate reliance on unethical labor
practices, such as child labor and slavery. Although CSR programs have
generally been most common among large corporations, small businesses
also participate in CSR through smaller-scale programs, such as donating to
local charities and sponsoring local events.
Some CSR activities by companies:-
Reliance Industries Limited
Reliance is India’s largest company by market capitalization. It is a significant
global player in the integrated energy value chain and has established a
leadership position in the Retail and Digital Services business in India.
Reliance Industries Limited has been the top CSR spender in the country for the
last several years. The Company spent Rs. 1186 crores on its CSR initiatives in
FY2021-22, higher than what it was obligated to spend as per the Company’s Act
(Rs. 1112 crores).
Reliance conducts most of its community outreach programs through Reliance
Foundation, the CSR arm of the Reliance Group. Since the inception of its
philanthropic activities, the company has touched the lives of over 5.75 crore
individuals. The main areas of focus of CSR of Reliance Industries include Rural
Transformation, Education, Disaster Response, Health, Sports for Development,
and Arts, Culture and Heritage. The company also extended its aid to the nation
to combat the spread of the COVID-19 pandemic.
Reliance Foundation was accorded for its Corporate Leadership in ESG at The CSR
Journal Excellence Awards 2021.
 Tata Consultancy Services Limited
Tata Consultancy Services (TCS), an IT services, consulting, and business solutions
company that is part of the Tata Group, has been assisting many of the biggest
companies in the world with their transformational journeys for more than 50 years.
In FY2021-22, the company spent more on CSR than was required (Rs. 716 crores),
spending a total of Rs. 727 crores.
The Company believes that all are born with equal potential but not equal
opportunity. TCS’ vision is to empower people and communities, building self-reliance
through purpose and technology while ensuring the values of fairness, equity and
respect for human rights. The Company remains steadfast in its mission to connect
people to opportunities in the digital economy while building equitable, inclusive
pathways for all – especially women, youth and marginalised groups.
TCS, through various CSR initiatives and programs across the globe, continues to
invest in addressing the most pressing needs of the community. The primary focus
areas are education, skilling, employment and entrepreneurship, with a focus on
bridging the opportunity gap for people and communities.
In FY 2022, TCS estimates that its global community initiatives reached more than 1.7
million beneficiaries, made possible by over 58,900 employees contributing over
700,000 hours of their volunteering time to support local community initiatives.