Why companies should embrace CSR? | Vishal Bhardwaj | Group Head- CSR | Indorama Corporation
I have been in the Corporate Social Responsibility (CSR) space for quite a while now. In fact, I have been here since before the term had been started to be used widely. Still, I find it challenging to answer some of the unassuming questions on CSR that I am asked. It’s not that I haven’t found the relevant answers in all this while that I have practiced as a professional, it’s mostly because it takes me some time to understand the pursuer- their background, their purpose, the context etcetera for me to articulate my response. I found myself in a similar situation when my LinkedIn contact, Sunita Rawat, who works as Director- S&D Media at the People Management, invited me to write a brief article on ‘why companies should embrace CSR?’ for their magazine. The challenge here was that the readers were anonymous and numerous. I have, therefore, tried to pen down my thoughts keeping in mind a regular reader.
Before I throw in my two cents’ worth on why the companies should embrace CSR, let me share what I have observed the businesses doing it for, in the last three decades. In my early days as a professional (for the purpose of setting the context, I have worked mostly in the manufacturing and mining sectors), philanthropic form of CSR was receding and CSR as a tool for stakeholder management was growing. Actually, it seemed like a good blend of both at that time. Nonetheless, that was what fetched the businesses the so-called ‘social license’ to operate. They could avoid disruptions by managing (a section of) stakeholders. Therefore, they were happy doing that and in fact, I have noticed many continuing to do so even now. There were a few others who saw the opportunity of advancing their brand reputation through CSR and some who approached CSR from the point of view of risk management and sustainability. Unfortunately, I didn’t come across many who strategized for creating shared values even though I had started to hear about that notion more than a decade ago!
Most of these drives are or should actually be the spinoffs, to my mind, and not the purposes. I believe that there should be two primary purposes for which the companies should embrace CSR. Firstly, to acknowledge the negative influences, if any, of their business even after they have complied to the law of the land. To explain this illustratively, if a farm mechanisation company leaves the farm labourers unemployed, they should acknowledge and work with the affected community to help them get ready for a substitute employment. If a mining company depletes the water table in a locality, it should manage the watershed in a manner that the impact is minimised. The first motivation, therefore, for the companies to embrace CSR should be to make sure that their existence minimally distresses the society in which they exist.
Secondly, the companies should embrace CSR to fulfil their moral obligation of being dutiful towards the society. Many business leaders prefer to call this ‘Giving back’. The businesses have liberally invested their money in societies in which they coexist to build infrastructure and strengthen the Institutions, which result in to improving the quality of life in their neighbourhood. Besides money, some businesses also use their core competence to bring about a systemic change in the society. I have witnessed some great instances of that. A leading toothpaste manufacturer’s CSR focusing on oral healthcare and a top computer maker working with unreached communities on digital literacy, are good cases to be quoted here.
To keep it brief, as I had been advised, I will sum up affirming that the companies should embrace CSR principally for two reasons, mitigating their footprints and fulfilling their moral obligation to give back. While doing so, they are destined to position themselves as a preferred brand and be assured of attracting the interest of customers, employees as well as that of the Investors. Could the companies ask for more?
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