02Jul2014

Why Do Corporations Need to be Socially Responsible?

By Anjali Godyal – Group Leader, Projects

Andrew Carnegie said that “by achieving wealth, we undertake an obligation to repay that which we have gained—we are trustees for future generations.” This underlines the true spirit of corporate social responsibility (CSR). I believe that with the growing Indian economy, corporate India through its CSR initiatives can play a major role in rural development.

Do corporations hold responsibility for the society apart from their stakeholders?  The answer is an obvious “yes”. Corporations do not function in a standalone environment and often, the government ensures favorable environments for their growth. To make certain their viability and continuity, corporations are provided with subsidized power, water, land and even finance; this is all tax payers’ money. They exist because there is a market and there is a market because there is a thriving society. Wellbeing of a society is a must for corporations to operate successfully.

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In India, as in many parts of the world, there is no universally accepted definition of CSR.  In certain cases, CSR translates into structured engagement with multi-stakeholders with well-defined programs in focus areas. However, for some corporate entities, it can be a one-off or a set of sporadic activities that are often in response to a social cause, including charitable emergency relief activities following calamities and disasters.

At Sehgal Foundation, I have worked with some corporations on their grassroots programs. I believe these programs have been successful as both the collaborative entities leveraged their strengths—Sehgal Foundation’s expertise of working with the communities and corporations’ resources. Together, we could address specific needs of village communities and make a change in their lives. CSR initiatives, if designed and implemented properly, can bring about prosperity and development in rural India.