Inclusive growth calls for intensive collaboration between Government and Private Sector: Pranab Mukherjee, President of India

President unveils logo of Sammaan: The CSR Exchange, a first-of-its kind platform jointly launched by BSE, CII & IICA at the National Summit on CSR

While the Government has launched several initiatives to promote inclusive growth, the private sector has a major role to play in this endeavour said Mr Pranab Mukherjee, President of India. He was speaking at the inaugural session of the National Summit on CSR – Partnering the National Agenda, organised by the Confederation of Indian Industry (CII) in partnership with the National Foundation for Corporate Governance (NFCG) in New Delhi today.

Showing confidence in industry’s ability and commitment to the cause of CSR, he said Industry will be a more than able partner to the Government, stressing that Indian industry must use its strength and competencies and lend its expertise to a wider array of programmes, which would impact society. A one-size-fits-all approach, he elaborated, will not work and industry should identify issues relevant to different regions and help address those.  CSR today refers to a comprehensive sense of responsibility extending beyond the responsibility to shareholders, he added. The mandatory spend on CSR will generate a huge amount, and structured development of strategy is now required to ensure that the funds are used optimally.

Appreciating industry’s work in this area, and especially that of the CII, the President appreciated CII’s support to Government initiatives such as the Swacch Bharat Mission through its commitment to build 10,000 toilets in schools which is expected to usher in social transformation, and the India@75 initiative, which is mobilising youth for social transformation.

The President unveiled the logo of Sammaan: The CSR Exchange, a joint initiative of the Bombay Stock Exchange (BSE), Confederation of Indian Industry (CII) and Indian Institute of Corporate Affairs (IICA).  Designed as a platform to facilitate interactive collaboration on Corporate Social Responsibility, the BSE enabled technology platform will bring together the strength of CII’s member corporate base and the Implementation Agency Hub (IA Hub) of the IICA.

Earlier, Mr S. Ramadorai, Chairman, National Skill Development Agency and National Skill Development Corporation and Non-Executive Chairman, BSE mentioned that Samman was the world’s first CSR exchange and will facilitate CSR initiatives of corporates.

Ms Anjuly Chib Duggal, Secretary, Ministry of Corporate Affairs said that while CSR initiatives by corporates have been an ongoing activity, the intent of the CSR provision in the Companies Act is to institutionalise the focus on giving back to society with the hope that this focus translates into projects where industry uses its management strategies to identify and implement programmes.

Earlier in his address, Mr Sumit Mazumder, President, CII, that while some countries continue to reel under economic stress, India is projected to grow at 7.5% according to IMF and World Bank estimates, and in such a scenario, there is greater responsibility to ensure that as the nation moves forward, the benefits of prosperity reach all. He said CII is aware of the role the corporate sector has to play in this, and thus its Theme for 2015-16: Build India – Invest in Development, A Shared Responsibility.

Mr Rakesh Bharti Mittal, Chairman, CII National CSR Summit 2015 said that over the last few years, the Government’s perception of the role of industry has changed and India Inc has proactively taken up and participated in several Government initiatives, adding that this Summit was an initiative to create a strong, sustainable movement for inclusive growth.

Dr Raghupati Singhania, Co-Chairman, CII National CSR Summit 2015 said that CSR has now moved from the backroom to the Boardroom, adding that CII has always believed very strongly that inclusive growth is necessary for sustainable development and equitable distribution of wealth. He said it was critically important to build capability of CSR practitioners, NGOs, grass-roots level people for all sections of society to benefit.

CII Director General, Mr Chandrajit Banerjee, said that CSR has always been a part of the Indian ethos, and that it is heartening to see that over the years, structured CSR activities have gained momentum. He spoke of CII’s initiatives towards CSR, notably the CII Foundation, the CII-ITC Centre of Excellence for Sustainable Development and the CII-Sohrabji Godrej Green Business. The CII Foundation, an initiative of CII, helps connect the marginalised to donors and works in diverse areas such as women empowerment and sanitation to name a few.  He also mentioned CII’s initiatives in areas such as maternal and child health, education, renewable energy, disaster relief and rehabilitation and said CII is currently deeply involved in relief work in Nepal.

First-of-its kind survey of top 200 companies in India reveals good practice and intent in business responsibility but calls for enabling policy environment

The CII‘s Centre of Excellence for Sustainable Development (CESD) has released the findings of survey of top 200 companies in India, in a report called ‘Business Responsibility India Survey 2013.’ The release of the National Voluntary Guidelines on Social, Environmental and Economic Responsibilities of Business (NVGs) in 2011 and the CSR Section 135 in the Companies Act, 2013 have led to a larger discussion amongst the stakeholders about the linkage between them. However, perceptions and practices vary and businesses continue to engage in a range of ways on these issues across the spectrum. In that context, CII-CESD thought it important to produce the necessary statistical evidence.

The prime objective of this survey was to provide statistical evidence on BR and CSR practices followed by the top 200 listed companies in India to its various stakeholders. The survey gives key insights into what the largest companies in India are already doing on BR and CSR. It highlights how these companies are responding to demands from various stakeholders to becoming more sustainable and responsive in their businesses and operations. The survey also provides insights to the government to evolve public policies on BR and CSR.

Being an industry association, CII has always encouraged and supported companies in their efforts to become more responsible and sustainable through its initiatives. This Survey provides some striking insights on how the companies in India are already doing on business responsibility. It talks about various sustainability reporting frameworks that companies already use, the percentage of profits they spend on Corporate Social Responsibility (CSR), and the way they honour human rights and address health and safety issues in their organisations.

Key Findings

• Strong areas in Business Responsibility (BR) are environment, employee affairs, and governance
• Areas of concern are human rights, corruption and supply chain
• The Regulatory mandate by SEBI requiring the top 100 listed companies to submit BR Reports based on the NVGs is the leading driver for demonstration on policies
• About 75% companies have incorporated BR into purchasing policy / supplier code of conduct
• About 48% of the companies have or are in the process of conducting ecosystem footprint
• About 25% companies surveyed spend at least 2% of PAT on CSR activities
• Women are under-represented at the workplace. Women employees account for less than 10% for more than half of the top 200 companies
• Nearly 50% companies have no women in the top management or on the Board

 Key recommendations

• Survey findings suggest that many companies already spending 2% per cent or more on CSR. However, CII-CESD’s experience shows that companies find it difficult to exhaust this budget if areas and methods of spends are restricted. India faces many challenges that require innovative ways of solving them, strengthening or creation of new institutions, research, debate and on ground action – all of these are suggested to be qualified as CSR spends
• Almost every company engages with government departments for CSR activities. However, very few of them utilise public funds for these activities. From CII-CESD’s experience, it is known that partnerships with government can be a great means to address the various developmental challenges such as health, education, rural development, livelihoods, etc.
• CSR is a part of overall BR and sustainability strategies of companies, and is contained in the NVGs under Principle 8. This linkage between CSR Section 135 and the NVGs could be clarified under the Rules and implementation improved
• Overall, there are a lot that companies in India already in the CSR and BR space and regulatory frameworks appear to have complemented their efforts. Also, there is no debate that companies can no longer operate in the manner they used to and they will have to make sustainability a core aspect of their business sooner rather than later. However, it is too early to tell whether this will happen through mandatory regulatory frameworks or voluntary efforts. Perhaps, a middle path is the most pragmatic and effective solution.

About Confederation of Indian Industry

The Confederation of Indian Industry (CII) works to create and sustain an environment conducive to the development of India, partnering industry, Government, and civil society, through advisory and consultative processes.

CII is a non-government, not-for-profit, industry-led and industry-managed organization, playing a proactive role in India’s development process. Founded over 118 years ago, India’s premier business association has over 7100 members, from the private as well as public sectors, including SMEs and MNCs, and an indirect membership of over 90,000 enterprises from around 257 national and regional sectoral industry bodies. http://www.cii.in

 

About CII-ITC Centre of Excellence for Sustainable Development

A pioneering effort by CII, the Centre works to create and sustain an environment conducive to the growth of business, partnering business and government alike through training, advisory and consultative services. It is the fountainhead of transformative and inclusive solutions to promote sustainability, which nurtures clients to compete, expand opportunity and excel in today’s dynamic business environments. The Centre enables businesses to become sustainable, and channels the potential of Indian industry to power the country’s agenda for inclusive growth and sustainable development www.SustainableDevelopment.in

Industry Empowered to decide on their CSR

CII, in partnership with the National Foundation for Corporate Governance (NFCG), organized a National Summit on CSR, Embedding CSR into Business Strategy on 30 September in Delhi. Held against the backdrop of the inclusion of Clause 135 in the recently passed Companies Bill 2012, which makes CSR a core function within industry and emphasizes the role of the corporate sector beyond profit, this summit enabled varied stakeholders to come together to discuss and deliberate on critical issues.

 In his inaugural address, Mr Sachin Pilot, Minister for Corporate Affairs, Government of India said that this new policy would see both the community and organizations benefit. Mr Pilot emphasized that the Government was keen to adopt a very flexible approach. Industry would be free to choose programmes and strategies best aligned to their corporate philosophy and businesses. He assured industry that the Government would not apply any rules with retrospective effect. He also promised industry to take up a request that the CSR spend be given a tax break with the Finance ministry.

In a special address, Mr M J Joseph, Additional Secretary, Ministry of Corporate Affairs, Government of India, said that when it came to embedding CSR into business strategy, the execution and mainstreaming of strategy was of paramount importance. He also urged industry members to give any suggestions on the subject to the Government. Mr. Rakesh Bharti Mittal, Chairman, CII National Council on Development Initiatives in his address, reiterated the country’s  development challenges: poverty, low levels of literacy, limited access to basic services like water, health, sanitation etc., low wages and income insecurity in the unorganized sectors and stressed on the imperative for inclusive growth in the context of India’s long-term growth prospects. While thanking the Government for the flexibility accorded to corporates to decide on CSR programmes and strategies, he also requested that the provision that mandates the three-year track record required for an NGO or Foundation to receive funding be relaxed in the event that a Foundation belongs to a reputed industry organization. Mr Chandrajit Banerjee, Director General, CII said that this CSR Summit will truly prove to be a pivot for government and industry in meeting our joint objectives of economic growth and development.

The summit saw excellent participation from all stakeholders. Experts in their field, shared experiences and insights on how to arrive at a new path for structured engagement with stakeholders, with a multifaceted approach spread across intersecting economic, social, and environmental dimensions. The challenges posed in this pursuit have implications for virtually every aspect of a firm’s strategy and business model. Arriving at a holistic view on how the new legislation will assist corporates in arriving at a structured CSR engagement as also lead to new paradigms for equitable and sustainable development at the national level. In monetary terms, it is estimated that the new provision will lead to anything from 19,000 to around Rs 25,000 crores annually. This money could make a significant difference if the proper delivery systems are put in place to translate them into meaningful programmes to reach out the communities.

This summit focused renewed attention on the need to start building capacities, not only of the CSR practitioners but also of Civil Society Organizations / Non Government Organizations etc that will enable structured engagement of the industry with the communities in further stimulating the developmental process in India. It will also encourage organizations to take a look at their CSR programmes and assess their impact to ensure equitable and sustainable national growth in the long term.