Delhi High Court today ruled in favour of CAG audit of pvt telecom companies having revenue sharing agreement with Govt of India. In the course of the verdit the Hon. Judges have pronounced words of wisdom on Corporate Social Responsibility albeit indirectly.
Times of India (Jan.7, 2014) reported this news:
ToI also published an article titled "CSR: Startups see Opportunity" (Jan 7, 2014)
It appears the Corporate Sector and NGOs are conveniently forgetting the "ethics" part of CSR. The concept of CSR originated in early twentieth century in USA, at a period when the large Corporate entities were viewed as "too big, too powerful and anti-social, and they were engaged in anti competitive practices. Efforts were made to curb corporate power through antitrust laws and other regulations - (Business & Society - William C. Frederic and others - McGraw-Hill International)".
In as much as this aspect of regulations, Delhi High Court has reiterated CSR of the Corporate Sector by stating that "circumvention and perversity produce an intensification of the command and this means that one is back to square one".
CSR combines the principles of Stewardship and Charity.
Well before 1912, Jamsetji Tata, the Founder of the Tata Group said, " We do not claim to be more unselfish, more philanthropic than other people. But we believe in sound and generous business principles and regard the health and the welfare of our employees a sure foundation of our prosperity". Tata steel implemented labour welfare measures which paved way of many of Govt. of India's labour welfare measures. This is Stewardship principle. Employee Welfare, education and health are part of CSR and should form part of CSR activities. Honouring Stakeholder Interests is integral part of CSR, viz.
Government: taxation, VAT, legislation, employment, truthful reporting, diversity, legalities, externalities.
Employees: rates of pay, job security, compensation, respect, truthful communication.
Customers: value, quality, customer care, ethical products.
Suppliers: providers of products and services used in the end product for the customer, equitable business opportunities.
Creditors: credit score, new contracts, liquidity.
Community: jobs, involvement, environmental protection, shares, truthful communication.
Trade Unions: quality, worker protection, jobs.
Investors: return on investment, income.
What is the point of implementing CSR if the company does not pay its vendors in time leading them to near bankruptcy, So many small scale industries in India face this problem.
It is now on Charity Principle Corporate entities are outsourcing their charitable activities by engaging NGOs. Hopefully there will be quality audit of such activities so that intended beneficiaries receive intended benefits.
Hopefully India Inc's CSR activities will evolve into including ethical operations.
