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Maratha MandirsBabasaheb Gawde Institute Of Management Studies

Corporate Social Responsibility and Education in India

Ghanshyamdas SarafSenior Vice Principal, Vaidya Bhavana, College Mumbai, [email protected]


Objectives

1. To highlight the role of corporate social responsibility as an essential feature ofcorporate policy.

2. To focus on the need for corporate social responsibility to play a major role inEducation in India.

3. To stress the inter-relationship between the roles of Government,corporate andeducation in India

4.Suggestions

1. CSR programmes should contribute a bulk of their resources to education.2. Investments in research, spread of information and communication technology from

school level onwards are the need of the hour.

3. Collaborations between Government, educational institutions and corporate willaccelerate educational reform and thus bring about the desired social development.


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What is corporate social Responsibility?

Corporate Social Responsibility (CSR) is becoming an increasingly important activity tobusinesses nationally and internationally. According to Lord Holme and Richard Watts"Corporate Social Responsibility is the continuing commitment by business to behaveethically and contribute to economic development while improving the quality of life of theworkforce and their families as well as of the local community and society at large" Asglobalisation accelerates and large corporations serve as global providers, these corporationshave progressively recognized the benefits of providing CSR programs in their variouslocations. Traditionally in the United States, CSR has been defined much more in terms of aphilanthropic model. Companies make profits, unhindered except by fulfilling their duty to

pay taxes. Then they donate a certain share of the profits to charitable causes. It is seen astainting the act for the company to receive any benefit from the giving.

The European model is much more focused on operating the core business in a sociallyresponsible way, complemented by investment in communities for solid business casereasons. This model is more sustainable as Social responsibility becomes an integral part ofthe wealth creation process - which if managed properly should enhance the competitivenessof

siness and maximise the value of wealth creation to society. CSR Initiatives in India is ablend of the above two models.

CSR is about building sustainable businesses, which need healthy economies, markets andcommunities.

The key drivers for CSR are:

Enlightened self-interest - creating a synergy of ethics, a cohesive society and a sustainableglobal economy where markets, labour and communities are able to function well together.

Social investment - contributing to physical infrastructure and social capital is a necessarypart of doing business.

Transparency and trust - business has low ratings of trust in public perception. There isincreasing expectation that companies will be more open, more accountable and be preparedto report publicly on their performance in social and environmental arenas.

Increased public expectations of business - globally companies are expected to do morethan merely provide jobs and contribute to the economy through taxes and employment.

Corporate Social Responsibility (CSR) in the context of Globalisation


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Globalization could lead to benchmarks, better jobs, higher standards of living, but couldresult in the gap between developed and developing countries broadening to the detriment ofall. Thus, two key areas need to be managed by corporations, along with governments in theprocess of globalisation, talents (and the mobility of people with talents in demand) and trade.Developing countries need to learn to develop and also retain talent, and that requires a

revamp of much of its culture including education infrastructure, legal systems, immigrationpolicies and management policies, while arts and entertainment facilities will need to adapt tomeet changing demands and more international tastes. A free and open trade and investmentenvironment is necessary, but achieving agreement between many countries and cultures isdifficult. A harmonious symbiosis of Global-Local approach incorporating a sense of socialresponsibility is required by corporations to help developing countries through their transitionto knowledge societies.

In this era of globalisation necessitating effective corporate governance, corporations haveincreasingly come to realize the need to share a common vision of corporate socialresponsibility though the contents and issues which it would encompass and the priority

accorded to them would differ. Successful businesses realize the benefits of deep communityties, creating path-ways of exchange of information, energy and ideas. Increasinglycompanies are separating community management from public relations by opening upseparate offices. According to Jack Greenberg, President and chief executive officer ofMcDonalds Corporation USA, the company works with local governments, to touchpeoples lives at the grassroots level. Our commitments to social responsibility and to makingprofits are necessarily linked. Corporations need to realize that good causes can helpimprove a company's as well as a countrys image.

The notion of corporate social responsibility is especially crucial in the case of developing orunderdeveloped countries. In the case of mining companies of Latin America their earlierpaternalistic relations with local communities resulted in suppressing initiatives in education.

That relationship has now changed to greater partnerships with local communities. Thereforesocial responsibility is a means of managing risk and avoiding a big price to pay for lack ofinvolvement. The case of Microsofts investment in India in different ways in the sphere ofeducation (Project Shiksha) and health (namely in terms of eradication of HIV/AIDS) areworth emulating by other corporations. The case of Malayampa natural gas power project inthe Philippines is worth mentioning in Shells commitments towards sustainabledevelopment. SmithKline Beecham's aim to eliminate elephantiasis and Liz Claiborne'sefforts to increase awareness of domestic violence are some of the examples of corporationsincreasingly taking on the mantle of social responsibility.

In this present era of globalisation as corporations are becoming more aware of their socialresponsibilities the traditional responses of companies contributing to good causes aredramatically changing from mere philanthropy. Despite the worthwhile support given bymany corporations, an enormous amount could still be done. If companies each invest in onegood cause with the same fervour, which they invest in their bottom lines, a huge step couldbe taken towards easing many social woes, particularly poverty eradication be it throughinvestments in health education, knowledge management, etc. One of the key steps would beto thoroughly understand the local environment in which most companies operate. Forcorporations in the developing and underdeveloped countries, bridging the divide (digital,economic, social or environmental) in order to eliminate poverty should be the essence of

the social agenda.


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Corporate social Responsibility and Indian context

Corporate social responsibility is represented by the contributions undertaken by companiesto society through its core business activities, its social investment and philanthropyprogrammes and its engagement in public policy. In recent years CSR has become a

fundamental business practice and has gained much attention from executive managementteams of larger international companies. They understand that a strong CSR program is anessential element in achieving good business practices and effective leadership. Companieshave determined that their impact on the economic, social and environmental landscapedirectly affects their relationships with stakeholders.

Corporate Social Responsibility (CSR) has acquired new dimensions in recent years. TheIndian context is distinct. On the one hand, there are long-standing traditions of respect forfamily and social networks, and high value placed on relationships, social stability andeducation. Diverse religions and cultures also bring distinct attitudes towards communitysocial behavior and engagement as well as support and philanthropic contributions.

Governments in the region also play distinct roles often stronger in terms of influence oneconomic and social priorities, yet not as advanced in terms of social safety nets.

CSR is not a new concept in India. Corporates like the Tata Group, the Aditya Birla Group,and Indian Oil Corporation, to name a few, have been involved in serving the communityever since their inception. Many other organizations have been doing their part for thesociety.

CSR has become increasingly prominent in the Indian corporate scenario becauseorganizations have realized that besides growing their businesses it is also vital to buildtrustworthy and sustainable relationships with the community at large.

Another reason fuelling this rapid adoption of CSR is the state of the Indian society. ThoughIndia is one of the fastest growing economies, socio-economic problems like poverty,illiteracy, lack of healthcare etc. are still ubiquitous and the government has limited resourcesto tackle these challenges. This scenario has opened up several areas for businesses tocontribute towards social development.

Today, CSR in India has gone beyond merely charity and donations. It has become anintegral part of the corporate strategy. Companies have CSR teams that devise specificpolicies, strategies and goals for their CSR programs and set aside budgets to support them.

These programs, in many cases, are based on a clearly defined social philosophy or areclosely aligned with the companies business expertise. Employees become the backbone ofthese initiatives and volunteer their time and contribute their skills, to implement them. CSRPrograms could range from overall development of a community to supporting specificcauses like education, environment, healthcare etc.

For example, organizations like Bharat Petroleum Corporation Limited, Maruti Suzuki IndiaLimited, and Hindustan Unilever Limited, adopt villages where they focus on holisticdevelopment. They provide better medical and sanitation facilities, build schools and houses,and help the villagers become self-reliant by teaching them vocational and business skills.


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On the other hand GlaxoSmithKline Pharmaceuticals CSR programs primarily focus onhealth and healthy living. They work in tribal villages where they provide medical check-upand treatment, health camps and health awareness programs.

Many CSR initiatives are executed by corporates in partnership with Non-governmental

organizations (NGOs) who are well versed in working with the local communities and areexperts in tackling specific social problems.

For example, SAP India in partnership with Hope Foundation, an NGO that works for thebetterment of the poor and the needy throughout India, has been working on short and longterm rebuilding initiatives for the tsunami victims. Together, they also startedThe SAP LabsCenter of HOPE in Bangalore, a home for street children.

CSR has come a long way in India. From responsive activities to sustainable initiatives,corporates have clearly exhibited their ability to make a significant difference in the societyand improve the overall quality of life. In the current social situation in India, it is difficult for

one single entity to bring about change, as the scale is enormous. Corporates have theexpertise, strategic thinking, manpower and money to facilitate extensive social change.Effective partnerships between corporates, NGOs and the government will place Indiassocial development on a faster track.

Corporate social Responsibility and philanthropy

CSR is also linked to the broader issue of Corporate Governance. Needless to emphasizethat Indian companies have to take a closer look at CSR and link it to corporate governance,if they really want to make a mark in all the three pillars of CSR. According to a recent pilotsurvey by CII in Tamil Nadu, ( see Express Buzz 13th J an) only 40 per cent of the companiespractice CSR initiatives. The pilot survey, highlighted that a majority of the companies didnot take CSR seriously and those who did, did it only with a philanthropic frame of mind.

The pilot survey also revealed that more than 50 per cent of the companies made theiremployee welfare activities as part of their CSR initiative, not really contributing to anoutside community or its development.

While companies in India have started taking tentative steps in the CSR direction, apparentlythere is a long way to go. Historically, Indian companies had always strong philanthropicactivities mostly targeting their employees and their families. However, if CSR has to truly

become the soul and DNA of a company, then it has to break away from employee welfaremindset and encompass sustainable development.

In India, though corporates have a strong will to dedicate their resources for a social cause,they find it difficult to reach the right people considering the demography and diverse socialproblems of the country.

The uniqueness of Smile Foundation lies in its working model Social Venture Philanthropy.SVP seeks sustainability, scalability, accountability, transparency, credibility and effectiveleadership. Smiles governance structure has a 4 tier audit and evaluation mechanism toensure right use of money and ultimately contribute a huge Social Return on Investment

against traditional methods. Its working model has made Smile Foundation one of the mostsought for charity brand today.


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Four years ago, Reliance Industries Ltd. launched a countrywide initiative known as ProjectDrishti, to restore the eye-sights of visually challenged Indians from the economicallyweaker sections of the society. This project, started by one of Indias corporate giants hasbrightened up the lives of over 5000 people so far.

CSR and Education

Today, public education faces the mounting challenges of standardized testing, strainedbudgets, teacher retention, and global workforce competition. At the same time, corporateAmerica has added pressure to prove itself to consumers, investors, and governmentregulators. These demands have given way to new opportunities for businesses to supporteducation in a win-win situation that benefits everyone.

Businesses have begun to take a more targeted approach in their corporate socialresponsibility programs and are seeking to impact areas that have a correlation with their own

business goals. For many businesses, education is an important part of their plans, since theneeds exist in all geographic areas, across all subject areas, and for all kinds of people. Thebottom line is that educational outreach efforts have the potential to make a real and lastingdifference for all players involved.

Companies get involved in education for a number of strategic reasons, including building apositive reputation and goodwill among consumers, employees, investors, and otherstakeholders; developing brand recognition, whether to increase consumer loyalty, boostsales, or establish the company as an industry leader; building a more educated workforce;raising consumer awareness about a particular issue; and fulfilling a company mission ormandate Students, schools, and the general public can benefit from the experience andexpertise that corporations bring to the table, particularly if the groups work together toensure the right needs are being met on both ends. Companies looking to contribute to publicschool education, for instance, must consider the many demands that schools and educatorsface daily time constraints, tight budgets, technology access, standardized testing, andexplicit curriculum standards as well as the unique places where outside help is needed. Aslong as they address the right needs, businesses have the ability to make a tremendousimpact. By providing highly engaging resources, by building in strong connections withinstructional needs, and by effectively marketing the resources, more and more companies aresimultaneously meeting educational goals and their own business goals. Parents areenthusiastic about the industry involvement, too, so long as its positive and productive. A

Michigan survey conducted in April 2007 by The Detroit News, The Skillman Foundation,and Your Child showed that 77% of parents think businesses should play a role in education,particularly by providing additional resources General Electric has a five-year, $100-millionCollege Bound program to boost the number of high school students who go to college incertain school districts. The program encompasses math and science curricula, professionaldevelopment, management capacity, and the involvement and expertise of GE officials. Oneschool superintendent said the initiative combines high academic standards, best educationalpractices, collaborative relationships, and the expertise of a longstanding partner and globaltechnology leader. In 2004, Citigroup announced the formation of its Office of FinancialEducation, along with a 10-year, $200-million commitment to financial education. Sincethen, the company has developed curriculum programs for aspiring entrepreneurs, college

students with questions about credit, and pre-scholars who are just starting to learn aboutmoney, among others. Thousands of Citigroup employees volunteer their time to teach these


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programs, which have reached people in more than 60 countries. Beyond curricula, somebusinesses get involved in the education world to train a new generation of employees. Lastyear, President Bush introduced the American Competitiveness Initiative to strengtheneducation, increase investment in research and development, and encourage entrepreneurship,with the goal of helping the U.S. maintain its global leadership role in science and

technology. Professional development, particularly popular in biomedical sciences andengineering, allows companies to reach out and flex their strengths and expertise, whileultimately strengthening a potential pool of employees. Biotechnology giant GenentechsCEO, Dr. Arthur Levinson, recently said, Were hiring as many good people as we can outthere, but theres not an infinite number of terrific people. To address the shortage, thecompany sponsors biotechnology workforce initiatives, offers financial assistance andinternships to diverse students, and supports health science education efforts from K-12through the graduate level. This type of comprehensive, focused, relevant involvement is keyto the new direction of corporate social responsibility. A new era of corporate involvementand investment in education is here, with promise and opportunity framing the way forward.

CSR and Education and technology

The world has undergone a tremendous change with the advent and proliferation ofinformation and communication technologies (ICT) such as the internet, email and wirelesscommunication, whose impact (both positive and negative) is perceived in every sector ofsociety and every corner of the globe. In this new era of knowledge society that has emergedin the course of human history role of corporations are extremely crucial in complementinggovernments efforts.

This is because people can no longer either underestimate or overestimate the potential rolethat digital divide could play. In this globalised economy, the role played by corporationsengaged in such enterprise could reduce the asymmetries created by the digital divide withinand amongst countries by utilizing the immense potential of ICT to the advantage of societyper se the world over.

Governments need to match the pace of change currently occurring in the world ofinformation technology and e-commerce. But unlike businesses, governments are hindered intheir ability to manage and lead change. Long-term strategies are forsaken in favour of short-term frameworks, which yield measurable outcomes. With any major social upheaval there isalways the danger that traditional values will be cast aside. However, in the Asian context

values will remain intact and perhaps become even more important. In this context it isessential that an increased value be placed on education with a strong emphasis on ensuringthat all members of society have access to the Internet. This means training teachers now,rather than waiting a generation until a new group of educators acquires computer and ITskills.

In this era of digital divide, the role of businesses entails joining forces with governments tohelp explain and promote long-term policies to affected populations. As a part of the Indiagovernments efforts a National Task Force on IT and Software Development was set up bythe Prime Minister's Office on May 22, 1998, under the Chairmanship of the Deputy

Chairman of Planning Commission, with a mandate to formulate the draft of a National


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Informatics Policy, to make India an Information Technology superpower and one of thelargest generators and exporters of software in the world within ten years.

The 108 Recommendations of the IT Action Plan Part-I emphasize the Policy Frameworkrequired for creating an ambience for the accelerated flow of investment into the IT sector,

with specific orientation towards the Software Industry. The Information Technology ActionPlan Part-II furnishes 84 Policy instruments for the Development, Manufacture and Export ofIT Hardware. The Task Force advocated that the software industry and the hardware industryare two sides of the gold coin representing India emerging as a global IT super power. Thesuccess of one, whether it is export of software of $ 50 billion by the year 2008 or ITpenetration drive for realizing IT for all by 2008, depends on the concomitant success of theother. The strategic policies for the IT industry, IT Research, Design and Development, ITHuman Resource Development, Citizen-IT Interface, Content Creation and ContentIndustry, Micro Electronics, Mission mode creation of fiber-optic infrastructure, financingthe IT sector and organizational structure have been analysed in detail in the report

In India there are many companies catering to IT education and training, like Infosys, Wipro,Tata Consultancy Services (TCS), NIIT, CMC, APTECH, DOEACC, etc., (providing ITeducation both in terms of creating a skilled and trained workforce, from the perspective ofcompanies needs as also to aid the process of computerization be it the railways, banking,insurance, health, etc. as also providing basic computer training in order to access the mine ofinformation presently available through internet). However, the problem that majoritystriving to gain access to computer education face is enormous expenditure incurred, muchbeyond the reach of the vast majority. For example, a three year course offered by say NIITwould approximately cost around 65,000-70,000 Indian Rupees, unlike a local grass-rootorganization, like NIC or say few cyber-kiosks, operating only in a particular Calcuttalocality would be much less say around 10,000 Indian Rupees. The quality of educationwould vary if one were talking of creating an IT expert but it would not really matter if onewere referring to an awareness of the basics of IT. Bridging the digital divide is not realizedby merely creating a pool of I T experts but also through the spread of the basics of ITeducation and the usage of computers in a localized manner right from the school levelinga manner affordable and accessible to the teeming majority.

For example, the touch screen computers and kiosks establish throughout Andhra Pradesh is apart of the governmental efforts in introducing e-governance is laudatory. However, in a statealso marked by high suicide rates of farmers, poverty and absence of basic literacy in therural interiors, such measures would only be effective in solving the plight of the farmers, if

investments are also made in basic education and awareness and the usage of the computers,be it when farmers apply for a small loan or demand better irrigation facilities, or avail thebenefits of ICT projects in rural areas, etc.

Amongst multinational corporationsMicrosofts recently outlined future vision and activitiesin India is an example of the crucial role that MNCs can play in complementing governmentsefforts and realizing the vision laid out in Indias IT strategy of increasing citizen-IT interfacethrough investments in education.

The Microsoft Chairman, Bill Gates during his recent visit to India, envisioned an Indiawhich in the course of its journey towards the end of the first decade of the new millennium,

would be one where individuals would be increasingly getting used to computer usage be itstoring music, photographs or information. The end result of this increasing interface, leading


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to a sort of dependence scenario would mean that in a country like India millions of peoplewould be employed in the IT industry in high salaried positions.

In a developing country like India marked by internal asymmetries that reinforces the digitaldivide, realization of the potential of the digital decade would entail enormous investments

and structural changes at varied levels, namely spread of education (not merely basic literacy)at all levels, development of a reliable communication infrastructure and the software toconnect the people of different communities with diverse socio-cultural, linguistic, religiousand ethnic background.

Project Shiksha (Rs.100 crore or US 20million dollar), launched by Microsoft to improvecomputer education in India, aims at training 80,000 school teachers who would be educating3.5 lakhs students across the country is an important step in this direction. Apart from ProjectShiksha, Microsofts strategy in India focus on localization efforts such that India adequatelyharnesses the benefits of the ongoing globalisation process by launching Windows XP andOffice in Hindi within the next year (2003) and would also envisage Windows XP local

language support to Bengali and Malayalam. Such initiatives can be categorized as far frommere altruism. They cannot be categorized as charity either as Microsoft also declared itsintention to invest US $389 million (rs.1900) crore in India over the next three years, whichaccounts for the companys largest investment outside the United States.

Despite the plethora of companies engaged in IT education large medium and small includinggrass-root organizations, the challenge of bridging the digital divide and removal ofasymmetries within different regions in India tailor-made to suit the varied diversitiescontinues to persist if the long-term potential of India in the field of IT is to be realised.Efforts of Microsoft are indeed exemplary and go a long way to suggest that corporations theworld over, through long-term investments in both research and the spread of information andcommunication technologies right at the school level, do have a crucial role to play inbridging the digital divide in terms of complementing existing governmental efforts.

Challenges encountered by business in the developing world

Themajor challenges faced by business towards reducing the digital divide existent withinand amongst the countries of the developing world, including India can be identified asfollows:

Governmental barriers arising from differences in forms of government and types ofregime marked by excessive regulation in important spheres highlights the crucial

issue of absence of good governance and requisite political will. Financial barriers dependent on the level of economic development due to lack ofadequate resources and the failure to avail of cost-effective technologies.

Technological barriers stemming from the non-availability of adequate infrastructuralfacilities.

Social barriers that are a result of the economic and cultural disparities between theelite minority and the vast majority.

Cultural barriers due to educational disparities raise the crucial issue of how to makethe educational significance of Internet and the consequent access to plethora ofinformation relevant to the majority of the world populace.

Education and CSR- the challenges ahead


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To enable educational institutions to cater effectively to changing economic and industryneeds, our educational policy should encourage greater collaboration between industry anduniversities in curricula and course design as well as industry research. There are severalexamples of industry academia collaboration in India. ICICI Bank has worked closed withdeans and professors of several colleges to help develop course content and to provide

visiting faculty to these colleges. Bharti Tele-Ventures has set up a telecommunicationtraining school at IIT, Delhi. Infosys has established campus connect, an initiative to enhancethe quality of teaching in technical colleges in India. Infosys also provides 26 Ph.D.scholarships in the IITs, the IIMs, IIS and a few engineering colleges. The Governmentshould also encourage more collaboration between industry research institutions and collegesthrough tax incentives and a deregulated environment for research.

Even if we need more monetary resources, we would do well to remember the words ofRobert Bok, former President of Harward University who remarked, and If you thinkeducation is expensive, try ignorance!

Conclusion

Corporate Social Responsibility has many facets. Companies have been finding variousinnovative alternatives to discharge their social responsibility. Education is the sector whichis the most eligible and socially rewarding effort for any corporate to be looked upon todischarge its social responsibility. Supporting education at any level will mean, re-energizededucation sector which can transform our country into a true knowledge power and realize afuture of prosperity and growth.

Bibliography/references

a. Books1. Corporate Responsibility, Blowfield. M.- Oxford University Press2. A Guide to Corporate Governance, N Gopalasamy- New Age International3. A Better India, A Better World, Narayan Murthy-Penguin Books4. Corporate Social Responsibility-Challenges in the age of Globalisation, P.V

Khatri/ Indu Baghel- Global Vision Publishing house

5. Remaking Higher Education: Essays in dissent. Amrik Singh- Harper Collinsb. Websites

1. www.timesfoundation.indiatimes.com2. www.indianet.nl3. www.globalissues.org4. www.acme-journal.org

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