CSR: Industry calls for progressive capitalism, see benefits percolating down

Dr Bhaskar Chatterjee, the architect of mandatory CSR in India, expressed satisfaction at the change in mindset of corporate leadership since it introduction.

CSR: Industry calls for progressive capitalism, see benefits percolating down
CK Ranganathan, AIMA president, highlighted the role of mandatory CSR in tackling the Covid-19 crisis. (File)

Progressive corporations are ensuring that the benefits of capitalism percolate down, said Rajashree Birla, adding that the key to meaningful corporate social responsibility (CSR) was running it like a business.

“We need to build a society that works for everyone,” the Aditya Birla Centre for Community Initiatives and Rural Development chairperson said at the All India Management Association’s (AIMA) Business Responsibility Summit.

“Aditya Birla Group has a social vision embedded in the business vision,” Birla said, adding that the group had received excellent return on its CSR investment in terms of the number of lives turned around.

Birla also insisted that CSR impact depended on the engagement of the top management.

She said the Aditya Birla Group’s CSR projects had one- and five-year plans and involved partnerships with the government, NGOs, and development agencies. “They help us get the bang for the buck.”

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Dr Bhaskar Chatterjee, the architect of mandatory CSR in India, expressed satisfaction at the change in mindset of corporate leadership since the introduction of mandatory CSR in April 2014, with company leaders no longer asking why they were being asked to spend on CSR.

“CSR has moved from the backroom to the boardroom,” he said.

CK Ranganathan, AIMA president and chairman and managing director at CavinKare, highlighted the role of mandatory CSR in tackling the Covid-19 crisis. The structures and systems put in place by companies to comply with CSR obligations allowed them to promptly respond to the crisis, he said. In the first year of the Covid-19 crisis, CSR spending peaked at Rs 25,000 crore, he added.

Ranganathan also pointed to the transition of CSR towards environmental, social and governance (ESG) issues. He said ESG issues were becoming important for investors and consumers in the developed world and Indian companies needed to pay attention to attract their capital. Millennials and Gen-Z are also looking at companies’ ESG record before buying their products or working for them, he said.

Also Read | Corporate Social Responsibility: How India’s CSR rules ensure strict compliance

AIMA Director General Rekha Sethi also stressed on the importance of human and environment health in business conduct. “The environmental cost of doing business is beginning to be counted more seriously and companies need to watch their ways to avoid restrictions by governments and rejection by consumers,” she said.

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