For the last two decades, I have watched from the outside how corporations struggle to engage their stakeholders—be it customers, employees, investors, vendors, lenders, communities or the government. Brands that are hit by a reputation risk jump up to try some “image management activity” that is often so superficial, one wonders if they even believe in it themselves. Companies that can’t offer meaningful purpose to their employees try to make up for it with a whole lot of picnics, parties and social activities. Yet others will engage in huge standoffs with the communities near which they set up manufacturing plants, and then try a handful of philanthropic initiatives to try and earn back goodwill.
The two per cent CSR rule will add yet another dimension to this. Corporates will try to see if they can ‘fit’ their other committed expenditure into this rule. The ministry of corporate affairs (MCA) will respond with more rules and the latest—a threat of penalties for non-compliance. Seems we’re headed for another evolutionary struggle out here.
As we approach the the sixth edition of Daan Utsav, the Joy of Giving Week, from October 2-8, though, I can’t help wonder if there is another way to look at this. Can one relate compulsory CSR to the spirit and joy of giving instead of reluctant bitterness? Can CSR be the glue binding firms with their stakeholders? It’s possible.
This Daan Utsav, one of India’s largest cement companies will reach out to distributors and dealers across the country, encouraging them to contribute cement for rehabilitation work in Uttarakhand and Jammu & Kashmir. The company will match their contributions and throw in technical expertise as a bonus. What do we think will happen when the distributor or dealer works side by side instead of haggling about how much stocks will be dumped with them? What if they instead discuss which school or home to rebuild?
A large retail chain will set up Wish Trees outside each of its stores from October 2-8. Manned by local charitable organisations, these trees will put up what these orphanages or elderly homes typically need—groceries, toiletries, cosmetics etc. Customers walking into the stores get an opportunity to do their bit by fulfilling any of the wishes they want—right then and there! The store contributes the space, and puts up the tree and maybe matches the contributions made by customers. With long holidays from October 2-6, the chain expects bumper customer traffic. How do we think customers will feel seeing their store reaching out to those in need?
Several corporate offices will organise a range of employee engagement activities: a collection drive for employees to contribute toys, books, clothes and other materials, opportunities for employees to volunteer in the community—teaching English or math somewhere, doing a ‘Spotfix’ inspired by the Ugly Indians elsewhere, and in a third place, a Seva Chakra that spins out fun, and simple activities that each employee must then do. What happens when employees engage in these activities with those they couldn’t stand at work? What happens when people across functions build bonds while volunteering together?
Whether it is one-off celebrations like Daan Utsav, or round-the-year CSR programmes in a company, there is a golden opportunity to use ‘mandatory CSR’ to actually do a lot of good—not just for the communities that will be served, but for the company itself, in building greater bonds with all its stakeholders. A payroll giving or employee volunteering programme that helps employees bond with each other and with the organisation. An outreach initiative that allows customers, lenders and investors to do their bit. Involving vendors as partners in the company’s CSR efforts, collaborating with them to draw upon their strengths. A project conceptualised and executed jointly with the local communities and the local government. And perhaps all of this culminating, not merely in a ‘compliance statement’ in the annual report, but who knows—maybe at the annual foundation Day of the company, an opportunity for all these stakeholders to come together, and see what they have accomplished, together!
CSR Expert Venkat Krishnan N. is director of the GIVE Foundation.