Survival of any species depends on the suitable physical/external environment, sufficient quantity of material resources and useful services. The natural environment and resources have to be in a balance of their own, which is inevitable for the sustenance of any economy. The so called modern development has exerted such pressure on resources and environment that depletion of resources and degradation of environment have become serious problems.
Scientists, technologists, policy makers and administrators, religious Institutions, NGOs and corporate houses are actively engaged in mitigating the adverse impacts of modern developmental activities on society and the eco system. India is no exception to this trend.
Corporate Social Responsibility of companies – both private and public – has become one of the main sources of nation building in recent years. Recent studies (Bain and Company in association with Dasra, 2019) show that the Philanthropy in the country has gone up 21% in the last 5 years. Internal (the working environment within the company) and external (Environment/ecology) sustainability is the broad objective of any spending under CSR. Cumulative spending in CSR has reached Rs 50,000 crore in just 4 years since the legislative mandate was implemented. (India CSR Network, 03/03/2019)
CSR Dimension of Profit
“It is a complete misnomer to believe that the purpose of business is to be profitable or to serve shareholders. Profit is simply a means to an end. Ultimately the purpose of business is to serve society through the provision of safe high quality products and services that enhance our wellbeing, without eroding our ecological and community life support systems” (Wayne Visser, The Evolution and Revolution of CSR, 2010)
Profit is not a single man’s show or a single firm’s contribution. It is part of the final output that comes out of the combined efforts and contribution of different types of resources and forms of services. The outcome of this output is happiness, peace and prosperity in society.
CSR is a bridge that connects the accelerated production and profit with the sustainability of society and environment. It is also a bridge that connects the success of science and technology (Technological Investment) in business with peace and prosperity (values/spiritual capital) in life. Unless and until the supply of natural resources and peace in society prevail, progress of business and profit cannot be attained and sustained. Hence business sustainability is a function of social peace (social sustainability) and nature’s balance (environmental sustainability).
For small and large business houses, now CSR has become the fundamental strategic priority. It seems that business concern has gone beyond profits and reached the realm of finding solutions to environmental, social and in some cases economic problems as well.
“If we are to avoid catastrophic climate change, build truly fair and inclusive economic growth and navigate a radically reshaped world, It is time to change. We have within our area the ability to reorient business and turn the tide of climate change, deliver economic opportunity for all and build connected societies in which all people can live in dignity and with respect”. (Business for Social Responsibility Report – 2017)
CSR – Sustainability Model for India
India is a middle income developing country. It is one of the fastest growing economies in the world. There is an expanding business world in India with corresponding CSR growth. Hence while framing a model of CSR sustainability, the objective should be mitigating the impact of the worst eco – environmental and social problems in India.
The gradual disappearance of the green grace of nature is the price of modern development. India is also facing the problems of environment on a large scale. Hence the primary objective of any CSR initiative should be the protection of environment, since it provides the fundamental resources in the form of raw materials. Pollution of air, water, soil, deforestation and desertification, acid rains and toxic wastes, climate change, global warming and ozone depletion cause hindrance to all types of business.
The second precondition of any business development is a peaceful and harmonious society. Progress and prosperity along with profits are the fruits of business trees grown in the soil of society, absorbing the nutrients of ethics, values, peace, and harmony. Hunger, poverty, ill-health, illiteracy, terrorism and violence along with natural calamities also decelerate the process of business as a whole.
The socio, eco-economic imbalances will have a natural reflection in the internal environment of a business firm. Hence CSR has become an effective tool to fight against these problems and also to assure a secure business environment.
Need Based Model of Sustainability Through CSR
This model emphasizes the priority of basic life support system, while undertaking the CSR projects, which is applied equally to the whole humanity and eco system on Earth along with business, without which life would be impossible. Hence it is basically a survival based resource stock assurance approach, which is inevitable for business and the competition that it exerts on society.
- Air Quality Assurance
Air is the fundamental factor that assures life on this planet. After Industrial Revolution, the quality of air has deteriorated a lot. Levels of carbon dioxide in atmosphere reached 403.3 parts per million (ppm) in 2016. It was lower than 280 ppm for the last 8000 years and has risen since the Industrial Revolution. Carbon dioxide has increased up 145% over the pre industrial period (before 1750) levels, Methane up by 257%, and Nitrous Oxide is up by 122%. (TOI, 31/10/2017). Hence all forms of business have a responsibility to keep the quality of air suitable for life. External Sustainability can be assured through proper CSR projects that help the non pollution and purification of air, all over the world and particularly in India, when International score in Air Quality Standard is only 5.75 out of 100.
2. Water Quality assurance
The next CSR priority area in attaining sustainability should be water. The Report of the NITI AYOG – 2018 states that India is facing the worst water crisis in history. 600 million people are dealing with high to extreme water shortage. We have 16% of world population to consume 4% of world’s water supply. 75% of Indian population is affected by contaminated water (pollution) and 20% of diseases in India are due to this.
2.8 billion people all over the world face water scarcity every year. Hence while undertaking projects under CSR, priority must be given to water related issues in India.
3. Soil Quality assurance
It takes 200-400 years to form 1 cm of fertile top soil, while the estimated rate of soil pollution is very high due to solid and liquid waste from the industries and large scale farm business all over the world. Major threat to soil in India are erosion by water and air, salinization or alkalinity, acidity, organic carbon losses, nutrient imbalances, contamination by toxic substances etc.
Sufficient CSR spending for the protection of top soil in India will assure food security for the population. Food security is a precondition for sustainable development.
- Food Quality Assurance
Along with food security, the quality of food is also important in keeping the health of the population in good state. The food Safety and Standards Authority of India in their report (2014 – 15) says that 20% of the food items in India are adulterated. The adverse impact of this will reduce the working capacity of people and health expenditure also will be increased. CSR spending can encourage small scale industries that help the production of un adulterated food items.
- Minimum Shelter and Decent Dress assurance
The present government’s plan is to provide housing facility for all the people of India by 2022. Millions in India live in slums without sufficient and proper dress, especially in winter season. Even people lost lives in India due to the lack of sufficient warm clothing in winter season. Majority of of the diseased belong to the economically weaker sections.
If a portion of the CSR spending could be diverted to solve the housing problem of India, it would certainly accelerate the sustainable development process in the country. Measures to assure proper dresses to the poor also will add to the progress of sustainability in development.
- Health Protection and Promotion of Education
In 2018, according to the KPMG India survey, Indian companies spent Rs. 1691 crore as CSR expenditure on health.
Another one, the India Health and Wellbeing Study 2018, released by Willis Towers Watson, 66% of employers in India have already developed or are developing a stress or mental health strategy for their employees. An additional 17% are considering it for 2021. Companies are now engaged in developing a “coherent and holistic health and Wellbeing strategy encompassing all four aspects – physical, emotional, financial and family”.(Hindu,5/12/18)
The health of the community which is inside and outside the business houses are to be taken care of by the CSR sustainability policy. Good health indicators of the employees inside the company, and people living around it are positive indications of sustainable development.
The CSR spending on Education in 2018 by Indian companies was to the tune of Rs.2202 crore. It is spread from primary to higher education. As illiteracy is one of the curses of modern India, any spending on education is not an excess. The standard of education imparted to the youth of the country determines the level of research and development (R&D). The R&D in its turn determine the number of innovations, patents and consequent economic development.
Future Road Map
The future road map of CSR shows that much more than the governments and NGOs, the global business will play an important role in making progress on sustainability. (State of Sustainable Business Report -2017)
In an article by Adam fisherman on ‘Private sector and SDGs’ (SDG Knowledge Hub, 27th Nov. 2018) it is made clear that a good company is not one which makes profit, but one which makes change – in the way people think and act. Private companies that are taking corporate sustainability reporting more seriously and investors with an eye on delivering sustainable development have become the main actors in modern business. It says that 193 countries, 9000 companies and investors with more than $ 4 trillion in assets have pledged their support to the UN Sustainable Development Goals (SDGs). Due to the ‘Ripple Effect’ many entrepreneurs and companies are inspired by another person’s/company’s CSR work.
India also has a leading role to realize the SDG objectives through its environment and development policy. SDGs 1,2,3,4,6,12,15 and 16 directly deal with the basic needs of the community. Thanks to the CSR policy of persons like Azim Premji, who is India’s second richest person and No.1 in philanthropic activities, the nation can thrive along the path of CSR for realizing the basic needs of millions of people.
As CSR is an important means of meeting the necessary criteria for SDGs, the above Need Based Model of CSR Sustainability can be an effective tool for achieving the above goal.
Article Credit: CSR Journal