Corporate Social Responsibility

Human Welfare and improving the Quality of Life in Society

Business is dependent on society. Is existence is due to the people living within a social structure To survive and thrive Business should earn the goodwill of people Companies relate to society through more than just market place transaction They serve a wide range of values than the traditional economic ones (Companies are more than economic institutions)

They have a responsibility to devote part of their resources to help solving some of the pressing social problems( some of them have been created by the company themselves) The pursuit of economic growth need not necessarily lead to social progress. In many cases it has led to A deteriorating physical environment, exposure of workers/consumers to toxic substances, urban decay and other social problems

Growth responsibility: Best way to survive and grow in the long run is to operate profitably by serving customer responsibly Long term orientation: Require loyal brand of customers, repeat customers Goodwill cannot be bought, begged or borrowed Reputation of company (through care and concern) Give and take relationship: Business takes much from society also owes something to society

External Government Law

Society

Internal Shareholders

Business

Employees Suppliers

Specl interest groups

Financial Institutions Customers

Political Groups Government

Owners

Financial community

Activist Group
Firm F

Suppliers

Customers
Customer Advocate groups Unions

Competitors Trade Asso

Employees

Optimum use of scarce national resources Not to waste, misuse, damage or cause to deteriorate Alternate use, crucial option ( opportunity cost) Responsibility not to make losses( KF airlines) Improved Quality of Life Responsibility of employment and income Offering quality product and fair price

Environmental protection (cement /chemical companies)

Fair Trade practice ( as per MRTP act) Charging fair and reasonable price Offering quality products as per claim and promise Making goods available to Mkt ( no artificial scarcity) Not indulging in black marketing Not making misleading claims in advertisement Making prompt payment of loans and borrowing Paying corporate tax, duties and dues Not bribing public servant, or political favours

Safeguarding heath and wellbeing of consumers Poor QC, substandard products, date exp. goods, poor storage, chemical causing skin damage CSR ( TATA, ITC, ACC, P& G, Infosys, Microsoft) Business creates wealth for the community hence it needs to make profits. It is ethical to make profits & generate revenue for s.holders, employees, creditors