What is CSR? (Corporate Social Responsibility)

What is CSR? (Corporate Social Responsibility)

CSR or Corporate Social Responsibility is defined as the voluntary efforts taken by the company to give back to society. It is a commitment of business entities to serve society at large, socially, ethically, and economically in a sustainable manner.

Benefits of CSR

CSR is not just restricted as an obligation for business entities, in today’s world it plays a vital role in creating brand awareness among various stakeholders.

CSR creates a sense of belongingness for the employees of the companies, employees feel proud of associating with a business that is involved in CSR. It also increases employee satisfaction.

Positive CSR activities also create a strong customer base for the company in the long run.

When businesses are constantly involved in doing CSR, they attract new business opportunities. The campaigns that are directed towards CSR projects, help business entities to network and in turn bring new projects for the business.

Types of CSR

There are four main types of Corporate Social Responsibility.

1. Environmental Responsibility
2. Ethical Responsibility
3. Philanthropic Responsibility
4. Economic Responsibility

A well-designed CSR campaign can help businesses to cover all four aspects of Corporate responsibility. From small business owners to big corporations, nowadays people are voluntarily engaging more and more in CSR activities.

There are even consulting firms that specialize in creating goal-oriented campaigns for business firms. From brand awareness to creating a good Public Image in the minds of customers, consulting firms are engaged in creating a bang on customized CSR strategies for their business clients.

National CSR Portal –  With the enactment of the Companies act 2013, India became the only country in the world to have mandated CSR by imposing statutory obligations on the companies. This move has proven to be a game-changer as to how people and business entities perceive CSR.

The truth about CSR

The enactment of the Companies Act 2013 has opened up new doors for NGOs to get access to the funds available for the purpose of CSR. Many have benefitted from the same but there are still many small Non Governmental Organisations that have not been able to access the CSR funds.

There are a number of reasons behind this, from lack of information to lack of initiatives when it comes to pitching business giants for CSR projects. NGOs face a lot of problems accessing the funds available for CSR.

This is when good consulting firms can come into play, and fill the gap between the business organizations and NGOs.

The future of CSR

The concept of CSR is new to India, many big business groups like the TATA group, Aditya Birla group, and many others have been involved in CSR for a very long time. But it is only after the introduction of the New Economic Policy in 1991, the concept became more and more relevant in India.

And since the Companies Act 2013 mandates the business entities to take CSR activities as an obligation, it has become trending in the business world.

The Millennials hold the future, and according to a study, 90% of the consumers said they will boycott a company if they do not agree with the CSR policy of the company.

Whereas 80% said they will switch to another company if it is doing better work in CSR.

Though it is a long way for Indian brands to tap the potential of CSR and its effect on society as a whole, the trend has started and it is blooming.

But Some major problems like transparency and accountability will still hold a ground issue for the Indian economy when it comes to the future of CSR. There is a need to bring a balance between the interest of business organizations and society to establish a win-win situation in the future.

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