India Inc gets ready to cater to society

Over 80% corporates are involved in corporate social responsibility and the number is growing.

They see a lucrative market in this huge sub-continent, but day by day, corporates in India are increasing their share of social work too.

There has been a 17 per cent jump in the last three years in the number of companies taking up corporate social responsibility (CSR) work. This trend is spearheaded by the MNCs who are now on a par with public sector undertakings (PSUs) in delivering to society.

In a detailed survey about CSR in India by Partners in Change, an agency set up by the NGO ActionAid, corporates were found most interested in working in the areas of health and education.

Out of the 536 companies surveyed, various categories of CSR undertaken included: health (66 per cent) followed by education (56 per cent), natural resource management 38 per cent, infrastructure development (per cent), community support (28 per cent), livelihood non-farm based development (20 per cent) and livelihood farm-based development (12 per cent). 
 

TOP FOUR SECTORS IN CSR
Textile sector	93%
Infrastructure	89%
IT/media/telecom	88%
Hospitality sector	79%
BOTTOM FOUR SECTORS IN CSR
IT/bio-tech/media	9%
Services	16%
Pharma and chemicals	10%
Finance	10%
(CSR study by Partners In Change)

In 2000, 69 per cent of the companies surveyed were found involved in CSR. But in just 3 years the figure shot up to 86 per cent. The biggest leap is made by MNCs, from 66 per cent in 2000 to 93 per cent in 2003. This is the same as the PSUs, which increased their presence in the social work sector to 93 per cent from 78 per cent earlier.

In its third report on corporate social responsibility in India, Partners in Change highlighted that the belief in CSR has a direct relation with the company's age and turnover. Older companies and those with greater turnover were more involved, the report said.

"The two main reasons which drive companies to discharge CSR are philanthropy and reputation. Other drivers were economic and tax benefits and pressure from interest groups," the report said.

However, there are also companies which deliberately stay away from social responsibilities. Partners in Change found that 42 per cent of them didn't consider the issue seriously, while 40 per cent companies, which were non-committal, felt that doing business honestly was sufficient. Others cited resource constraints.

The survey, done during 2000-2003, found that the highest involvement was from the textile sector (93 per cent), followed by infrastructure (89 per cent) and IT/media/telecom (88 per cent).

Corporates in the hospitality sector showed 79 per cent involvement in CSR. The sectors that showed relatively less commitment to CSR over the last three years include services, engineering, IT/media/telecom and finance.

Financial donations or provision of funds was found to be the most common method of discharging CSR. In 81 per cent cases, companies donated money to fulfil their commitment towards CSR.

Followed by the company's facilities (25 per cent), staff deputation (24 per cent), staff volunteering (20 per cent), distributing company's products (19 per cent), and employment for poor and disabled 17 (per cent).

While in staff deputation PSUs have the highest share (44 per cent), MNCs lead in the category of monetary support (85 per cent). In 66 per cent cases, money is directly given to the community in need. NGOs at the grassroots level receive donations only in 14 per cent cases.

There are only 18 per cent organisations who donate more than Rs 10 lakh a year. The report also highlighted that only 17 per cent of the companies surveyed in India had a written CSR policy.