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Total Number of Subscribers: 426 |
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Date: 19 April 2008 |
Compiled by Mr. M. Sathya Kumar |
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Corporate Social
Responsibility The changing face
of Indian Industry The wind of transformation of the global economy has manifested
new changes in the corporate initiative. Earlier firms viewed corporate
social activity as just writing checks based on management discretion, to
projecting themselves as good. But there has been a shift towards identifying
the domain area and initiatives that can be integrated with the business
philosophy for making long term commitments with the objects of not only
doing well, but also doing well. What is corporate social responsibility? Corporate social responsibility is a much misunderstood concept.
It contradicts the corporate objectives of profit motive. But it is difficult
to overlook the prime objective of the business for the purpose of 'do
good activity'. Today consumer not only ready to accept the role of a
corporate house only to satisfy their demand to produce the goods according
to their requirement. According to Kotler and Lee-it is" a commitment
to improve community well being through discretionary business practices and
contributions of corporate resources." The world business council on Sustainable Development
has defined corporate social responsibility as the "commitment of
business to contribute to sustainable economic development, working with
employees, their families, the local community and society at large to
improve their quality of life." It is the backbone of today's business
sustainability.Kotler cites several benefits of corporate social initiatives on
the part of corporates.It includes- 1) Increase in sales As "initiative" is necessary to fulfill the unfulfilled
business operation and long term profitability as well as sustainability by
meeting the ethical, legal, commercial and public expectation that society
has from business. What is our new mantra of corporate social initiative: The following is the major underlying thought in respect of
corporate social responsibility. - What has been the organization's contribution to society and
the economy as a whole? M B Lal ,chairman and MD of HPCL considered that large
transnational corporations need to play the role of 'Social
Transformation Agents' by creating a positive impact through their business interventions.Organisation
should transformed their role from 'wealth creators' to 'wealth distributors'
in order to the enterprise activities. Corporate social initiatives may be defined as 'the major
activities undertaken by a corporation to support social causes and to
fulfill commitment to corporate social responsibility.' In other words,
Corporate social initiatives of transnational corporations is no more an
option but an imperative for sustainable in the long run. What is the core philosophy under Corporate social
responsibility? It is needless to mention that a corporation is framed or exist
for the basic purpose of wealth generation, maximizing the stockholder's
return and long run sustainability. Profit or economic gain should be the
core objectives of any business to survive. But at the same time for the sake
of the self sustainability and enjoy a longevity and growth, the organization
cannot or should not forget its responsibility towards the society or the
environment in which it operates. To provide support in the favour of corporate social
responsibility the comment of The economic aspects of corporate social
responsibility: Corporate social responsibility in the broader sense is taken to
mean sustaining economic/business activity by co-mingling social
responsibility of the enterprise in their external and internal relations
with business prospects. Hence, corporate social responsibility is more than
charity. It has some underlying economic implication. It is an innovative way
to contribute by the firms to spend in towns and villages and to buy products
from millions of artisans who are at the bottom of the pyramid. The fortune
of the bottom of the pyramid calls for corporations to design
products/services for the enormous population at the bottom of the
pyramid.The primary assumption is that this population segment has some
disposable income and firms can still make profits on large volume.Hence it
moves the corporation towards a set of socially committed and aligned work
culture. Conclusion: It may be aptly said that it is a co-branding with corporates
social initiatives with core objective of business philosophy. It is not a
charity rather, it is a mean to sustain long term economic gain over other
competitors.Hence, and the idea of a business organization to maximize
profits and also contribute to the society is mutually exclusive. Courtesy : Sumanta Dutta, Faculty member,
ICFAI National College |
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