Bottom Up Approach of CSR

Recently, in a panel discussion on ‘Corporate Social Responsibility (CSR)’ in Delhi organised by International Funding Agency,  speakers after speakers went on reiterating corporation’s responsibility to be socially responsible. Speakers kept on highlighting that products, production process, and marketing strategies of all corporations need to be socially, economically, and environmentally "acceptable". Suddenly, almost taking the discussion head-on, one of the participants stood and said “it is accepted that business houses, being the part of larger social system, need to be concerned about the implications of their business for the society, but we also appreciate that corporations exist for profit, and make profit by serving member of the society. Corporations will be socially responsible only when it adds in their profits, and also the social system recognises and rewards their socially responsible behaviors. So, the ultimate movers of CSR are consumers and not corporations”. He further added “unfortunately, each one of us is trying to pass the buck to corporations without even acknowledging that we too are responsible for corporations’ behaviors”. For the moment there was a silence, and when discussions resumed, it has changed tone and tenor. After all, there were reasons in his statement.


Consumers, the major driver of any business, have been found lacking in their response towards the efforts of making CSR a reality. Consumers have failed to encumber or even resist the consumption of socially detrimental products and services. Consumers tend to enjoy everything without considering its after and side-effects of thoughtless consumption. Consumers, by and large, are either ignorant or pretend to be unaware of the ultimate price they have to pay, and consequences society has to face. Can’t consumers be socially conscious, and responsible? Can’t they use only those products and services which are socially desirable? Why can’t they prefer those companies having better track-record of business?

These questions clearly are pertinent and make a case of bottom-up implementation of CSR? Consumers, being the most powerful and central to any business should be conscious of their own roles and lead the movement towards CSR. It is natural that if the CSR becomes consumer driven it will be become part of the corporate management system. Today, corporations are the inventing mechanisms to ‘project’ themselves as socially responsible. Civil society and NGOs have been tetchy against corporations for their ‘only profit’ oriented business. Business magazines have been evaluating corporations based on their own parameters of CSR and writing for and against corporate behaviors. Academia has been studying various organizations to find out the most appropriate business strategies which will help in developing the most suitable definition of CSR. Today all concerned with corporations (with obvious exception of corporation themselves), hold corporations if not solely, then primarily responsible for CSR. And, consumers are not in consideration at all. Unfortunately, in spite of being the most potent players in business, consumers continue to be cold towards their own expected social responsibilities, “consumers’ social responsibility”. Consumers’ priority, and decision making process are too short sighted and self-centered.

For common consumers, the mantra seems to have changed from “ needs based consumption” to “products based consumption”. Today consumers, regardless of their income, have comparatively increased hunger for consumption. They want to own or use everything at lower cost in least time. Proliferation of plastic goods and so called Chinese goods in the market are evidence of such changed behavior. Awareness about the enormous hidden cost of participation in the mad race of ‘owning everything by paying something or almost nothing’ seems missing. When individual consumer is not bothered about the social impact of his / her own behavior, then talking about CSR of corporation is like duplicity.

Although, it is undisputable that corporations have their social responsibilities, continuous focus by all the stakeholders on CSR has literally turned the spotlight of responsibilities on business houses. Though this no way undermines the contributions of civil society, NGOs, government, and consumers, few would disagree that those collectively responsible for creating the desired environment for CSR have failed. Even investors and potential employees are still making ‘rational’ decisions which are based on ‘maximum return on minimum investments’. Shareholders wait for ‘dividend’ from companies and not reports on their ‘socially desirable performances’.

Can consumers really push corporations towards ‘Corporate Social Responsibility’? Yes, they can. For, they have the most powerful weapon built in their purchasing power. Consumers have the freedom to prefer or ignore a product or products of a given producer. If consumers behave responsibly corporations will be compelled to fall in line. No doubt, CSR (consumers’ social responsibility) will affect CSR (corporate social responsibility).

Understandably, it is difficult for consumers to change their behaviors as these are dependent on not only consumers’ attitude, awareness, and their socio- economic status but also on market related factors. Expecting consumers to be highly involved and evaluative in every purchase is not practical. Furthermore, the concept of CSR is too complex and evaluating corporations’ behaviors is not an easy task for common consumers. So, how can we make consumers socially responsible? First, consumers must appreciate importance of own consumption behavior and the impact of their behavior on society. Corporations are required to be more forthcoming about their business practices. Media, which are both omnipresent and omnipotent, need to inform consumers about the businesses of corporations and their impacts on society. NGOs besides playing the role ‘watchdogs’ by collecting and analyzing information about various business and educating consumers. Government too has to play the roles of regulator, and also of facilitator to save common consumers. However, the master key remains in the hands of all powerful consumers. If consumers take their stand and make it clear to the corporations, corporate social responsibility will become priority for all the corporations. And this in fact, will be the most viable and sustainable way of promoting CSR, i.e. bottom up approach of CSR.

I hope you enjoyed reading...

Niraj

CSR Communication: An Intoxicating Brand Building Instrument

“Generating employability” was the title of an article which had appeared in Economic Times under the section with heading ‘Philanthropy’ (6th June, 10; Kolkata Edition). It was an interesting journalistic piece. The title suggested that it is an article which is about a philanthropist or a development organization which is creating employment for those who really deserve and can not get. But once you have gone through the article you will find the story is about a multinational corporation which is a well known BPO in India, but also has “business interest in philanthropy”.

Not only the write up of the article is engaging, but the context too is timely. It talks about a campaign by the employees of Genpact to clean the surroundings of Qutub Minar in New Delhi. The context in the article (Commonwealth Games) makes the initiative apt and worth appreciating. The excitement and satisfaction (of their philanthropic works) among the employee are quite natural and expected to be with them for some time. I am sure, all those employee who participated in the event will keep their photographs with gloves, black bags, and pitchforks in hands on their office table, or will upload on their social networks sites to show that we do care for the society. The same event would be on the website of the company. These are understandable and employee and the corporation deserve these, at least.

But what is more interesting to find that this article has done a great favor to the company by adding in their “brand value”. I am sure, no advertisement would have done so for the company. Quotations of the company representative have very intelligently but gently conveyed the message which any company like Genpact would like to convey and which will help their further building their brands. It certainly establishes that “CSR Communication” works for the companies.

The mails by the inspired employees indicate the higher motivation and high self esteem of the employees. And, company going to reap the benefit of this without spending any extra penny. If company wants, it can keep the motivation alive for considerable period. What a gain ? It is a tacit, indirect, and powerful tool in the hands of corporate managers to achieve more by spending less.

However, it is true that corporations need to do something which is worth considering for CSR communication. And it does require skills of planning and executing such efforts /events, and more so communicating to stakeholders so that returns are very high, both tangible and intangible.

One can, indeed argue whether such actions are enough to be considered as a CSR related activity but the article (CSR Communication) has certainly done more to the company than what company might have expected from the campaign.

Waiting for Rain.....
Niraj

you can read the article by following the link: http://lite.epaper.timesofindia.com/getpage.aspx?pageid=7&pagesize=&edid=ETKM&edlabel=ETKM&mydateHid=06-06-2010&pubname=Economic+Times+-+Kolkata&edname=Kolkata&publabel=ET