Sustainability and Corporate social responsibility.pptx

Sustainability and Corporate social responsibility.

1. Sustainability &Corporate Social Responsibility A nation that destroys its soils destroys itself. Forests are the lungs of our land, purifying the air and giving fresh strength to our people.” - Franklin D. Roosevelt Dr. R Saminathan Associate Professor of Commerce, Centre for Distance & Online Education Bharathidasan University, Trichy, Tamilnadu Email: [email protected] Asst. Prof. DINESH S Assistant Professor of Commerce, St. Francis College, Koramangala, Bengaluru Email: [email protected]

2. Corporate Social Responsibility (CSR) CSR refers to a company’s efforts to operate in an economically, socially, and environmentally responsible manner beyond legal requirements. It involves voluntary initiatives that contribute to society and stakeholders while maintaining profitability. Key Aspects of CSR: Economic Responsibility – Ensuring ethical business practices and financial sustainability. Legal Responsibility – Adhering to laws and regulations. Ethical Responsibility – Operating fairly and justly beyond legal obligations. Philanthropic Responsibility – Contributing to social causes through donations, community programs, and employee volunteering.

3. Sustainability Sustainability focuses on meeting present needs without compromising future generations' ability to meet their own. It includes environmental, social, and economic dimensions, often referred to as the triple bottom line : People, Planet, and Profit. Key Aspects of Sustainability: Environmental Sustainability – Reducing waste, conserving resources, and minimizing pollution. Social Sustainability – Promoting equality, fair labor, community development, and human rights. Economic Sustainability – Ensuring long-term profitability while integrating ethical and social considerations.

4. Stage-by-stage development of Corporate Social Responsibility (CSR) in India Stage Time Period Key Features Examples Pre-Independence Era 1850s-1947 Philanthropy and charity by business leaders Donations by Jamsetji Tata , Ghanshyam Das Birla to education, healthcare, and soc ial welfare Post-Independence Era 1947-1960s - State-led development with a focus on economic growth - Emergence of public sector enterprises - Establishment of steel and coal industries - Government-driven economic policies Social Responsibility Era 1970s-1980s - Growing awareness of corporate social responsibility - CSR-like initiatives in rural development and healthcare Tata Group and Birla Group foundations Hindustan Unilever rural development programs

5. Stage-by-stage development of Corporate Social Responsibility (CSR) in India Stage Time Period Key Features Examples Liberalization and Globalization Era 1990s-2000s Economic liberalization led to an increased focus on CSR Establishment of dedicated CSR departments Entry of MNCs bringing global CSR best practices CSR departments in Infosys and Wipro Mandatory CSR Era 2013-present Companies Act, 2013 made CSR spending mandatory for eligible companies Increased CSR spending on education, healthcare, and sustainability Indian companies investing in social welfare initiatives Structured CSR spending and reporting Emerging Trends in CSR 2020s-present Alignment of CSR with Sustainable Development Goals (SDGs) Growth of impact investing and social entrepreneurship Digital CSR and remote volunteering due to COVID-19 Companies focusing on sustainability Increased digital engagement and online volunteering

6. Evolution of CSR spending in India Stage Time Period CSR Spending (% of Net Profit) Key Features Pre-2013 (Voluntary CSR) Before 2013 Less than 1% CSR was voluntary Most companies spent minimal amounts on social initiatives Mandatory CSR (Companies Act, 2013) 2013-2014 2% The Companies Act, 2013 made CSR spending mandatory Applied to companies with a net worth of ₹500 crore+, turnover of ₹1,000 crore+, or net profit of ₹5 crore+ COVID-19 Pandemic and CSR Growth 2020-present 3-5% Companies increased CSR spending to support pandemic relief efforts Greater focus on healthcare, education, and community development Current Scenario (2022-2023) 2022-2023 2.15% (Average spending) Report by the Indian Institute of Corporate Affairs (IICA) shows companies are consistently meeting or exceeding the 2% mandate

7. Benefits of CSR Benefit Description Example Enhanced Reputation CSR initiatives build trust and improve a company's public image. Tata Group's Rural Development Program – Improved rural livelihoods, enhancing Tata's reputation. Increased Employee Engagement CSR programs boost employee morale, motivation, and retention. Infosys Foundation's Education Initiative – Employees feel motivated by contributing to education programs. Improved Brand Loyalty Customers are more loyal to socially responsible brands. ICICI Bank's Financial Inclusion Initiative – Helped millions of unbanked people, improving brand trust.

8. Benefits of CSR Benefit Description Example Risk Management CSR initiatives help mitigate operational and reputational risks. Hindustan Unilever's Water Conservation Initiative – Reduced water footprint and environmental risks. Cost Savings Sustainability-focused CSR efforts can reduce costs through energy efficiency and waste reduction. Hindustan Unilever's Water Conservation Initiative – Saved millions of liters of water, reducing operational costs. Access to New Markets CSR helps companies expand into new regions and build stakeholder relationships. Reliance Industries' Disaster Relief Efforts – Strengthened community ties and expanded market presence.

9. CSR and Sustainability Initiatives in India Company CSR Initiative Sustainability Initiative Tata Group Rural development, education, healthcare programs. Renewable energy adoption, waste management, green buildings. Hindustan Unilever Water conservation, sanitation, community health. Sustainable packaging, carbon footprint reduction. Infosys Skill development, education funding, digital inclusion. Energy-efficient infrastructure, carbon neutrality commitment. Reliance Industries Disaster relief, financial inclusion programs. Renewable energy investments, water recycling projects.

10. CSR vs. Sustainability: Key Differences Aspect CSR Sustainability Focus Social responsibility, philanthropy, ethical governance. Long-term environmental, economic, and social sustainability. Time Horizon Short to medium-term impact. Long-term impact for future generations. Compliance Often driven by legal mandates (e.g., CSR laws). Driven by global sustainability goals and environmental regulations. Approach Business-driven community development and stakeholder engagement. Systemic change in business operations and global impact.

11. Government Initiatives for CSR Initiative Description Impact Companies Act, 2013 (Section 135) Mandates companies with a net worth of ₹500 crore, turnover of ₹1,000 crore, or net profit of ₹5 crore to spend at least 2% of their average net profit on CSR. National CSR Portal Increased corporate spending on social welfare, education, healthcare, and environmental projects. National CSR Portal Launched by the Ministry of Corporate Affairs (MCA) to track CSR spending and projects by companies. Ensures transparency and accountability in CSR implementation. Schedule VII of the Companies Act Specifies areas where CSR funds can be used, including education, healthcare, gender equality, and environmental sustainability. Guides companies in choosing impactful CSR activities. PM CARES Fund Companies can contribute to disaster relief and pandemic response efforts as part of their CSR obligations. Provided financial aid during COVID-19, natural disasters, and emergencies.

12. Government Initiatives for Sustainability Initiative Description Impact National Action Plan on Climate Change (NAPCC) Framework with 8 missions targeting climate resilience, energy efficiency, and sustainable development. Encourages industries to adopt clean energy, reduce emissions, and promote green practices. Perform, Achieve & Trade (PAT) Scheme Energy efficiency program under the Bureau of Energy Efficiency (BEE) for industries to reduce carbon emissions. Reduces energy consumption and promotes sustainable industrial growth. Renewable Energy Policies (Solar & Wind Energy Programs) Initiatives like PM-KUSUM and National Solar Mission to boost renewable energy capacity. India aims to achieve 500 GW of renewable energy by 2030. Sustainable Development Goals (SDG) India Index Tracks India's progress in achieving the United Nations SDGs by 2030. Encourages states and businesses to align their policies with sustainability goals. Faster Adoption and Manufacturing of Electric Vehicles (FAME) Promotes electric mobility by providing subsidies for EVs and charging infrastructure. Reduces dependency on fossil fuels and lowers carbon emissions.