Home Demystifying CSR

Demystifying CSR


Sharmistha Ghosh, Account Director, CSR and Healthcare, Avian Media
Sharmistha Ghosh, Account Director, CSR and Healthcare, Avian Media

Corporate social responsibility (CSR) is attracting the attention and interest of the corporate world. With the mandate of CSR spending rising to 2% of profits from April 1, 2014, the space is witnessing multi-stakeholder conversations. The rules, which will bring almost 15,000 new corporates for the first time to this fold, will provide an enabling environment, a participatory approach and will bring CSR from the back room to the board room. 

Despite increasing awareness and the law slowly permeating into the system, there is much confusion over the understanding of the subject.

Here are some of the misconceptions surrounding CSR, refraining business leaders from integrating CSR into the business processes:

  • CSR and philanthropy are synonymous

While philanthropy is an act of donation or a good cause to a charity or an NGO,CSR is directly linked to the overall business goals of an organisationaddressing social, economic and environmental factors. It demands continuous engagement with stakeholders, mapping issues that can be addressed to mitigate risks in future. Unlike philanthropy, which is low on accountability, CSR insists upon sustainable development, strong accountability and measurable outcomes. Outcomes that give a competitive edge through shared value creation.

  • It is a strategy to avoid problems caused by unscrupulous corporate behaviours

CSR is a strategy to identify development solutions to social, economic and environmental challenges. It is definitely not the mechanism or tool to avoid problems caused by unethical corporate behaviour. An organisation building hospitals in its area of operation cannot neglect the health and safety of its employees. Similarly,a company may launch a cohesive climate change programme, but it cannot be called responsible if does not t express sensitivity to ethical disposal of industrial waste.

  • The impact of CSR is not measurable

The ultimate objective of a CSR initiative is no different from business objectives and it can be measured on the following parameters:

–       Enhanced brand reputation

–       Increasing customer base and greater customer loyalty

–       Risk management

–       Workforce management leading to higher employee retention, work-life balance, employee satisfaction, re-skilling and up-skilling

–       Strengthened investor relations and access to more capital

–       Innovative product and better product life cycle

–       Operational efficiency: Saving energy and operating costs

Better understanding and ideation around CSR can take a corporate to new levels. Linking one’s CSR agenda to business goals by leveraging the core competence of the company will ensure sustainability and wider acceptance.

(The author is Account Director, CSR and Healthcare at Avian Media)


Please enter your comment!
Please enter your name here