Private Sector Engagement in Livelihoods and Corporate Social Responsibility
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financial year 2012–13. Net profit, net worth,
and turnover for the current and future finan-
cial years will bemuchhigher than the financial
year 2012–13. Therefore, both on account
of 2 per cent calculations on corporate tax
and many more companies exceeding the
net profit, net worth, and turnover criteria,
the CSR spending for the current and future
years will be much larger than
`
25,000 crore.
According to IICA, More than 30,000
directors on the boards of these companies
will be involved in implementing the CSR
policy of these institutions. The Companies
Act and the CSR guidelines very clearly place
the responsibility for CSR activities on the
board and make CSR an integral part of the
corporate governance of the institutions.
The requirement to set up a CSR committee
and also preparation of a CSR policy that is
approved by the board ensure that this gets
the best of attention and that companies
actually focus on the people whomay ormay
not be the stakeholders of the company itself.
In this manner the CSR is integrated into the
overall governance practices of companies.
Increasingly companies find that their abil-
ity to run businesses sustainably is possible
only when they have the support of not only
their customers but also the community at
large. The guidelines on CSR and sustain-
ability for Central Public Sector enterprises
states, ‘Since Corporate Social Responsibility
and sustainability are so closely entwined it
can be said that CSR and sustainability is a
company’s commitment to its stakeholder
to conduct business in economically, socially
and environmentally sustainablymanner that
is transparent and ethical.’
There are also challenges in the man-
ner of companies’ engaging themselves in
CSR.
In several places the companies have
to look for implementation partners on the
ground to run some of their CSR projects.
The projects are focussed on education,
health, basic amenities for livelihoods. In
each case it becomes necessary to deal with
individuals and families and almost at their
doorsteps. The kind of delivery capability
required both in terms of manpower and
technical resources is scarcely available with
either the companies or even their dedicated
foundations. But one of the insights of
companies is also that there are not enough
well-managed voluntary sector entities
available to implement these projects for
best results. This requires the companies
to invest HR capacities for strategising,
planning and monitoring implementation.
The last mile delivery aspects alone are out-
sourced in favour of agencies that have the
ability to put staff in but their performance
needs to be closelymonitored and guided by
more professional staffing by the company
itself. If the partnership with voluntary
sector agency is for the long term then the
corporate starts investing in the capacity
building of the partner first. This pushes up
the cost and also reduces the ability of the
companies to execute very large projects or
cover large geographies. The second area of
discomfort is whenworking side by side with
government projects.
In almost all the areas
where the CSR activities can be focussed
there is a government programme being run
(with varying degrees of efficiency). While
in some cases because of the government’s
own commitment or because of the local
government officials’ positive outlook, it has
been possible for the corporate to work in
close co-ordination and avoid duplication
and overlap of efforts. But there are other
locations where it’s difficult to work along-
side or in partnership with the government
department or agencies. There have been
complaints of difficulties in holding health
camps, in entering villages for training of
rural youth or undertaking watershed pro-
jects or afforestation programmes for which
clearances fromDepartment of Agriculture
or forests are required.
In many cases the
corporates find that as per records the work
that they want to do has already been done
and because of this reason the permissions
from the concerned government depart-
ment do not come through. Such areas of
difficulties need to be smoothened so that
corporate sector can collaborate with gov-
ernment departments in a seamless manner.
