Corporate social responsibility (CSR) could be a variety of international private business self-regulation which aims to contribute to the societal goals of an activist, philanthropic, or charitable nature by engaging in or supporting volunteering or ethically-oriented practices. CSR is usually understood as to how an organization achieves a balance of economic, environmental and social imperatives (“Triple-Bottom-Line- Approach”) while at the same time addressing the expectations of shareholders and stakeholders. In this sense, it’s essential to distinguish CSR, which may be a strategic business management concept, and charity, sponsorships or philanthropy. Corporate social responsibility is also called corporate sustainability, sustainable business, corporate conscience, corporate citizenship, conscious capitalism, or responsible business.
Types of Corporate Social Responsibility
This section will provide you with types of Corporate Social Responsibility (CSR), and it is traditionally broken into four categories: environmental, philanthropic, ethical, and economic responsibility. Let’s check it out in detail.
- Environmental responsibility refers to the idea that organizations should behave as environmentally friendly away as possible. It’s one of the foremost common styles of corporate social responsibility. Some companies use the term “environmental stewardship” to discuss such initiatives.
- Ethical responsibility: it’s concerned with ensuring a company is working fairly and honestly. Organizations that embrace moral responsibility aim to treat all stakeholders fairly, including leadership, investors, employees, suppliers, and customers.
- Philanthropic responsibility refers to a business’s aim to actively make the globe and society a higher place.
- Economic responsibility: it’s the practice of a firm backing all of its financial decisions in its commitment to try and do good within the areas listed above. The top goal isn’t to quickly maximize profits but positively impact the environment, people, and society.
Corporate Social Responsibility Pyramid
How CSR Approaches?
A more common approach to CSR is corporate philanthropy. This involves monetary donations and aid given to nonprofit organizations and communities. Grants are made in areas such as housing, health, social welfare, arts, education, and the environment, among others, but excluding political contributions and commercial event sponsorship. Below we have mentioned the CSR approaches. Let’s have a look.
- CSR as corporate philanthropy
- CSR as risk management
- CSR as vakue creation
Let’s see the details briefly: Where should big corporations spend their CSR resources?
|CSR as corporate philanthropy||Innovative and promotes a sustainable business model||Fundamental strategic and operational impact||>Shared values (business institutions and communities)|
>Promotes a sustainable business model
>Develops human capital (key in developing countries)
Incorporated into the business strategy
|CSR as risk management||Compliance||Medium to high strategic and operational impact||>Mitigates operational impact|
>Mitigates operational risks
>Support external relationships
|CSR as vakue creation||Providing funding and skills||Little strategic and operational impact||> Corporate philanthropy and sponsorships|
> Short-term benefits/not always sustainable
> Limited funds available
>Impact diluted because the limited budget is allocated to many charities
>Corporate competencies and other business assets are not fully utilized.
>Misalignment between business and social responsibility strategies and functions
>Results in minimal social and business impact of social programmes.
About CSR in India
The Corporate Social Responsibility concept in India is governed by Section 135 of the businesses Act, 2013 and Rules made thereunder wherein the factors have been provided for assessing the CSR eligibility of a corporation, Implementation and Reporting of their CSR Policies. India’s foremost elaborated CSR mechanism and implementation strategy has started its journey to line a benchmark in achieving sustainability goals and stakeholder activism in nation-building.
CSR Quick Fact (Official Data FY 2018-19 to 2019-20)
Here is the official data by (https://www.csr.gov.in/) for how to grow the CSR work across India as a total number of companies, the amount spent and the total number of CSR projects and much more. Let’s have a look.
|Particulars||Financial Year (2018-19)||Financial Year (2019-20)|
|Total Numbers of Companies||24965||21349|
|Total Amount Spent on CSR (INR Cr.)||18728||21231|
|State & UT Covered||36||36|
|Total No. of CSR Projects||30843||30987|
|Development Sectors Entered by Companies||29||30|
CSR Spent: Top Companies in India
Here in this section, we are providing detailed information about Top Companies CSR spent in Crore. Let’s have a look.
|Company Name||Amount (INR Cr.)|
|RELIANCE INDUSTRIES LIMITED||908.71|
|TATA CONSULTANCY SERVICES LIMITED||602.00|
|OIL AND NATURAL GAS CORPORATION LIMITED||582.35|
|HDFC BANK LIMITED||535.31|
|INDIAN OIL CORPORATION LIMITED||518.49|
|BHARAT PETROLEUM CORPORATION LIMITED||346.46|
|POWER GRID CORPORATION OF INDIA LIMITED||346.21|
Frequently Asked Questions (FAQ)
Q. Why Should a Company Implement CSR?
A. Many companies view CSR as an essential part of their brand image, assuming that customers will be more likely to do business with brands they perceive to be more ethical. In this sense, CSR activities can be essential to corporate public relations. At the same time, some business founders are also motivated to engage in CSR due to their convictions.
Q. What is CSR?
A. Image result for CSR corporate social responsibility, the term corporate social responsibility refers to practices and policies undertaken by corporations intended to influence the world positively. The key idea behind CSR is for corporations to pursue other pro-social objectives and maximize profits.
Q. How many types of CSR?
A. Corporate social responsibility is traditionally broken into four categories: environmental, philanthropic, ethical, and economic burden.
Q. What is a CSR strategy?
A. CSR strategy is the comprehensive plan companies, and funders use to design, execute, and analyze their corporate social responsibility initiatives. It includes specific focus areas, program design, promotion and communication approaches, and evaluation procedures.