How India Inc can make their CSR spends count
(CSR in India will have come…)
How that the new Companies Bill has mandated that organisations
of a certain financial strength spend 2% of their net profit on
corporate social responsibility (CSR), two things are likely to happen
right away. First, the general spend on development projects will shoot
up, with more companies having to set aside funds for this.
And second, with the government keeping tabs, companies will have to
become more transparent about what they are investing in, how and where.
Only a handful of companies meet the 2% criterion (or come close) as of
now. Fewer still have well-structured, sustainable and far-reaching CSR
programmes. But here's a thought: as they up the ante - and their
budgets - for social sector activities, companies might want to pause
and think about the best way to make their CSR spend count.
India Inc has gone from chequebook philanthropy and backing causes on a whim to spending more (and in different ways) on stakeholders, be it customers or employees, or rural and semi-urban populations affected by the setting up of factories in their neighbourhoods.
"It's good to be engaged with people who live in and around your plants, but companies need to look beyond their business interests," says Amita Joseph, director of the Business and Communities Foundation. "If companies aspire to be national and global entities, their reach [in the social sector] must also be national and global." Industry gets so many incentives from the government, she adds, that surely companies can have more responsible practices in place.
OUTSIDE THEIR BUSINESS ZONE
Some companies are looking beyond their operational imperatives. Thermax, for example, didn't feel the need to focus on environment and alternative energy (a popular CSR plank) because it is already involved with solar power, wastewater treatment and reducing carbon footprint as part of its business. "We didn't want to link our CSR activities to our work," says Manabedra Nath Sanyal, manager, outreach programmes. "We wanted to look at areas completely de-linked from our business, like education and skill-building."
As Thermax director Anu Aga puts it: "There are enough causes
staring at us in India, like malnutrition, women's empowerment, rural
development and even city planning. I can't think of a single area where
we cannot contribute." Thermax, which spends about 3% of its net profit
on CSR activities, has invested Rs 24 crore on education and other
development projects in the last six years, says Sanyal.
As part of the affirmative action programme of the Confederation of Indian Industry (CII), an industry grouping, Thermax looks to increase the employability of youngsters from marginalised communities by arming them with the soft skills they might need to land a job. Of the 500 people trained under the affirmative action programme so far, most already had the requisite academic qualifications and domain knowledge; what they needed was help with personality development, knowing how to interact and work with colleagues, the confidence to max interviews and be more 'job-ready'.
Thermax tied up with Pune's English Language Training Institute of Symbiosis to create 60-hour modules administered as a crash course to the students on weekends, and also found placements for most of these youngsters. "There are certain sections of people who are deprived of opportunities or are unable to express themselves properly," says Sanyal. "Our 'finishing school' model helps them develop these skills."
India Inc has gone from chequebook philanthropy and backing causes on a whim to spending more (and in different ways) on stakeholders, be it customers or employees, or rural and semi-urban populations affected by the setting up of factories in their neighbourhoods.
"It's good to be engaged with people who live in and around your plants, but companies need to look beyond their business interests," says Amita Joseph, director of the Business and Communities Foundation. "If companies aspire to be national and global entities, their reach [in the social sector] must also be national and global." Industry gets so many incentives from the government, she adds, that surely companies can have more responsible practices in place.
OUTSIDE THEIR BUSINESS ZONE
Some companies are looking beyond their operational imperatives. Thermax, for example, didn't feel the need to focus on environment and alternative energy (a popular CSR plank) because it is already involved with solar power, wastewater treatment and reducing carbon footprint as part of its business. "We didn't want to link our CSR activities to our work," says Manabedra Nath Sanyal, manager, outreach programmes. "We wanted to look at areas completely de-linked from our business, like education and skill-building."
As Thermax director Anu Aga puts it: "There are enough causes
staring at us in India, like malnutrition, women's empowerment, rural
development and even city planning. I can't think of a single area where
we cannot contribute." Thermax, which spends about 3% of its net profit
on CSR activities, has invested Rs 24 crore on education and other
development projects in the last six years, says Sanyal.As part of the affirmative action programme of the Confederation of Indian Industry (CII), an industry grouping, Thermax looks to increase the employability of youngsters from marginalised communities by arming them with the soft skills they might need to land a job. Of the 500 people trained under the affirmative action programme so far, most already had the requisite academic qualifications and domain knowledge; what they needed was help with personality development, knowing how to interact and work with colleagues, the confidence to max interviews and be more 'job-ready'.
Thermax tied up with Pune's English Language Training Institute of Symbiosis to create 60-hour modules administered as a crash course to the students on weekends, and also found placements for most of these youngsters. "There are certain sections of people who are deprived of opportunities or are unable to express themselves properly," says Sanyal. "Our 'finishing school' model helps them develop these skills."
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