Business and Poverty: The
Indian approach to corporate
sustainability
(20 minutes)
SLIDE 1 – Title page
on responsible lending in India, is
the second element, the more
general commitment to CSR
within the Indian context. Indian
corporations have a long history
of
social
responsibility,
predominantly linked with deep
rooted religious obligations and
acts of philanthropy.
This
presentation brings together
SLIDE 2 – Outline
 Background to my research
 Being a responsible corporate – the Equator
Principles
 My interest in CSR
 Background to CSR in India
 Case study 1: SUPPORT
 Case study 2: AIS Glass
 CSR and the financial crisis
SLIDE 3 – Background to my
research
Sakhalin Island, Russia. Criticism
was focused on the offshore
pipelines interfering with the
natural habitat and the migration
path of the western Grey whale.
In addition, the financiers of this
development were in fact
signatories to the Equator
Principles,
violating
their
voluntary commitment to the
environmental and social lending
voluntarily adopted a set of
standards known as the Equator
Principles.
By becoming
signatories,
banks
were
committing to supporting the
environment on a voluntary
basis. Banks could no longer
afford to be funding projects that
had significant environmental
implications, their corporate
gaining of support from the
majority market banks. There
was a sense of frustration and
irritation
from
current
signatories that Indian and
Chinese
banks
were
not
committing to the international
lending guidelines and the
reasons for the lack of adoption
in these regions were unknown.
This research sought to ask
SLIDE 4: Being a responsible
corporate:
the
Equator
Principles
adverse environmental impacts;
such applications predominantly
include almost any new major
development scheme. Category
B is applied to projects thought
to pose potential for less adverse
environmental
impacts
on
human
populations
or
environmentally important areas
and category C is low risk, these
are seen to be acting responsibly,
relating to the implementation of
Environmental
Assessments,
consultations with indigenous
people and the employment of
independent
environmental
experts to offer additional
monitoring.
vulnerable environments and
communities.
56 interviews
were conducted last year with
the CEO’s and Managing
Directors of India’s leading
financial institutions and other
influential
organisations
to
ascertain their thoughts on the
Equator
Principles
and
responsible finance.
SLIDE 5: My interest in CSR
importance of the Equator
Principles
in
infrastructure
finance, a wider commitment to
environmental and social issues
is needed in the Indian corporate
sector, CSR, a responsible
approach to all aspects of
business. First I will provide an
overview of CSR trends in India
and then move on to present
SLIDE 6: Background to CSR in
India
attachment with philanthropy
but also the integration of
‘western’ CSR approaches into
Indian business models. From
the analysis of the interview
material, four themes are
evident with reference to the
current state of CSR in India,
ranging from a Friedman inspired
egotistical approach to a positive
altruistic attitude.
– 1.
The role of business is to maximise
profits
themes, proponents of this
attitude were in the minority.
The Chairman and CEO of a
large
infrastructure
finance
company proclaimed that, ‘a
company should be responsible
to its shareholders and not look at
the amount of pollution generated
ﾉleave companies to do what they
are supposed to do, that is
maximise profits.’
– 2.
Philanthropic commitment
worthy causes, there is the
general
consensus
that
philanthropy does not encourage
independence or innovation. As
Visser
2009
suggests
–
companies and their leaders
should be judged on who they
trample on and what they destroy
in the process of making money,
not who they keep once they
– 3.
CSR behind closed doors
with CSR. On the majority of
websites no public commitment
could be found, but on numerous
occasions CSR was alive within
the
organisation
occurring
‘behind closed doors.’ These
respondents felt that their
companies
were
social
development agents, but felt no
drive to publicise their acts of
good, in these cases the
– 4.
Integration- a new business generation
transition phase whereby iconic
business leaders are further
embracing CSR, adopting a more
sustainable CSR approach to
their business strategy.
This
research has identified several
beacons of integrated CSR,
encouraging
independence,
innovation and development.
on staff volunteerism, donations
and business advice offered by a
number of India’s businesses and
financial institutions which I
interviewed.
However,
SUPPORT
and
similar
organisations
are
already
struggling during this period of
economic
uncertainly
as
corporations are cutting back on
their philanthropy budgets.
SLIDE 7 - Case study 1: Support
food, but on day two they say
you have to fend for yourselves,
beg and steal. The children are
soon exposed to solvents,
heroin, cannabis, tobacco and
alcohol.
The organisation
operates several day care centres
on the platforms of two of
Mumbai’s largest stations, CST
and Dadar, supporting in the
company.
Whereas other
companies
provide
good
volunteer systems. A number of
children have been housed at the
centre for 10 years, now
educated and trained in a skill
their chance of employment is
much improved. Several of the
older
residents
are
now
employed to motivate and
encourage their peers.
In
SLIDE 8: Case Study 2: AIS Glass
the board recognised that in
order for their business to
survive and grow in the long
term, considerations have to be
given to the environment and
society within which they
operate. Currently, their CSR
agenda is focused on the
headquarters,
located
in
Gurgaon,
employing
1000
workers. However, there are
the day to day running of the
programme is operated through
an external Delhi based NGO,
Youth Reach, a model which is
becoming increasingly popular in
India. In 2004, AIS focused their
efforts towards a 2 phase
development plan as seen on the
slide.
commented: ‘you have got to
develop the area around you,
this has got to be part of your
long term business strategy ﾉ AIS
are thinking of the local people.’
Education
age and often the location of the
school being too great a distance
from their village. Through the
ICDP scheme, a woman from
Bawal village has completed her
teacher training and she is now
educating twenty one girls from
the village for four hours each
day between 10am and 2pm. As
one respondent explained, ‘she is
the brightest lady in the village
The furthest village from the
government run school is 16Km.
The buses have now been
operational for three years;
however, there are plans to
introduce a small fee for each
child of Rs.50/month [｣0.65]. As
AIS recognises, ‘it is important
for the community to realise that
these things are not free ﾉ it
gives them ownership over the
Women’s co-operatives
to Rs.200 per month.
As
recognised by one respondent,
‘the self-help group plays a major
role in sustainability ﾉ it enables
women to feel empowered ﾉ
teaches them how to work in a
group and how to manage
accounts.’ As one cooperative
group member remarked, ‘at first
my husband was not happy
about me joining, but we have
Water and sanitation
families now have toilets, 105 of
which were possible because of
the AIS grant. In total, 367
families have been supported
through the loan system.
Women in the groups have also
used the loans for agricultural
activities, livestock, trading,
production and service based
enterprises.
Demonstrations
thirty one villages have been
taught the ‘soak pit technique,’ a
method to deal with waste water
in the village.
In addition,
regular meetings with the
women are held to address
issues of a social and political
nature,
including
‘violence
against women, proliferation of
liquor vending, sanitation issues
and microfinance’ (AIS, 2007).
local community but not too
much as this can cause problems
with local politicians ﾉ in
addition, the local expectations
of the local population increases,
and people start to expect and
want things for free.’ This is a
fine balance, and for the time
being AIS glass is achieving
community
development,
SLIDE 9: CSR and the Financial
Crisis
certainly true in the Indian
context, the Manager of Youth
Reach has already noticed a
decline
in
philanthropic
spending; current company
donations are being cut and new
clients do not want to commit
during this period of uncertainly.
However, those with ingrained
CSR commitments such as AIS
glass, are continuing with their
SLIDE 10: Concluding remarks
local communities. One Vice
President explained that before
companies engage with CSR,
‘first [they] have got to
understand the need of the
communities which [they] serve,’
this, without a doubt is what AIS
has done in the case of Bawal,
they are not engaging with the
community for the sake of
enhancing promotional material,
case with AIS Glass, through
short and long term projects,
focusing on education, health,
water and sanitation they are
supporting the local village
communities inhabited by the
majority
of
their
employees. Cutting back in hard
times for AIS Glass is not an
option. This is an example of
business and society working