Business and Social Responsibility
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BUSINESS AND SOCIAL RESPONSIBILITY
GIVEN A WORLD BESET BY MYRIAD SOCIAL PROBLEMS ± HUNGER, HOMELESSNESS, CRIME, AIDS, ENVIRONMENTAL DEGRADATION ± THE QUESTION MAY BE POSED: DOES IT MAKE SENSE FOR A COMPANY TO VISIBLY ADOPT ONE OR MORE OF THESE PROBLEMS AS A COMPANY CONCERN? LET US REFRAME THE QUESTION: SHOULD THE COMPANY ACTIVELY CONTRIBUTE MONEY AND EMPLOYEE TIME TO AMELIORATE A SOCIAL PROBLEM?
AN ORGANISATION RECEIVES INPUTS FROM SOCIETY AND ENVIRONMENT IN THE FORM OF LABOUR AND RAW MATERIAL. BUSINESS, IN TURN, PROVIDES GOODS AND SERVICES TO SOCIETY. THUS,A BUSINESS EXISTS BECAUSE OF SOCIETY. THIS REALISATION IS VERY IMPORTANT FOR FIRMS. IT IS IN THEIR INTEREST TO TAKE CARE OF SOCIETY. BUSINESS CANNOT OPERATE IN VACUUM, THEY OPERATE IN THE REAL WORLD.
IF ORGANISATIONS ARE SOCIALLY CONSCIOUS, THEY WILL ENJOY ENHANCED VISIBILITY, LOYAL EMPLOYEES, CUSTOMERS, SUPPLIERS, LENDERS AND INVESTORS. THE CHALLENGE IS TO FIND A WAY FOR COMPANIES TO INCORPORATE SOCIAL ISSUES INTO THEIR CORE DECISION-MAKING PROCESSES. COMPANIES MUST SEE THE SOCIAL DIMENSIONS NOT JUST AS RISKS BUT ALSO AS OPPORTUNITIES.
THE CHANGING SOCIAL CONTRACT
COMPANIES HAVE ALWAYS HAD A CONTRACT WITH SOCIETY. THE CONTRACT EMBRACES NOT JUST DIRECT STAKEHOLDERS (SUCH AS CONSUMERS, EMPLOYEES, REGULATORS, AND SHAREHOLDERS) BUT ALSO A BROADER SET OF STAKEHOLDERS (SUCH AS THE COMMUNITIES WHERE COMPANIES OPERATE, THE MEDIA, ACADEMICS, AND THE NONPROFIT SECTOR)
PART OF THIS CONTRACT IS FORMALIZED IN LAWS AND REGULATIONS, AND VIOLATING THEM HAS OBVIOUS LEGAL RAMIFICATIONS. PART OF IT IS SEMIFORMAL: THE STAKEHOLDERS¶ IMPLICIT EXPECTATIONS, WHICH IF IGNORED CAN BRING ABOUT SWIFT ACTION. VIOLATIONS OF SEMIFORMAL CONTRACTUAL OBLIGATION CAN SERIOUSLY HARM A COMPANY¶S REPUTATION AS WELL AS CONSUMER DEMAND FOR ITS PRODUCTS.
MOST CHALLENGING ARE THE ³FRONTIER´ ISSUES THAT HAVE NOT YET ENTERED THE FORMAL OR SEMIFORMAL CONTRACTS BUT COULD, OVER TIME BECOME SOCIAL EXPECTATIONS. TAKE OBESITY. IT HAD ALWAYS BEEN WIDELY BELIEVED THAT THE RESPONSIBILITY FOR AVOIDING IT LAY WITH INDIVIDUALS, WHO CHOOSE WHAT THEY EAT, NOT WITH THE COMPANIES THAT MAKE OR SELL FATTENING PRODUCTS.
MUCH AS THE DEBATE AROUND TOBACCO SHIFTED THE RESPONSIBILITY FROM INDIVIDUALS TO AN INDUSTRY PERCEIVED TO BE AGGRESSIVELY MARKETING ADDICTIVE PRODUCTS. THIS HAS RESULTED IN BLURRING BOUNDARIES BETWEEN RESONSIBILITIES AND LAWS.
BUTTERFLY EFFECT
GROWING INTERDEPENDENCE AND INTERCONNECTEDNESS HAVE AMPLIFIED RISKS AND OPPORTUNITIES FOR CONSUMERS, EMPLOYEES, BUSINESSES, AND GOVERNMENTS. AS A RESULT, ISSUES THAT WERE ONCE PERIPHERAL OR LOCAL NOW HAVE GLOBAL IMPACT. FOR EXAMPLE, LOCAL LIVESTOCK CONTAMINATIONS, SUCH AS MAD COW DISEASE, AVIAN FLU THREATEN STABILITY OF GLOBAL HEALTH AND GLOBAL FOOD SUPPLY CHAINS.
GROWING SAFETY AND SECURITY CONCERNS; SENSITIVITY TO RISK
AS TECHNOLOGY ADVANCES PEOPLE ARE INCREASINGLY AWARE OF THEIR EXPOSURES TO RISKS AND ARE WILLING TO INVEST IN ORDER TO AVOID THEM. PEOPLE OFTEN MISUNDERSTAND OR MISCALCULATE RISKS BECAUSE OF THEIR UNREALISTIC DESIRE TO AVOID THEM COMPLETELY.
FOR EXAMPLE RESTRICTIONS ON NUCLEAR POWER DOWNPLAY LONG-TERM RISKS OF FOSSIL-FUEL-BASED POWER GENERATION. DRUGS APPROVED BY FDA LATER PULLED FROM MARKET BECAUSE OF POTENTIAL HEALTH RISKS TO SMALL PORTION OF POPULATION.
RISING INEQUALITY
GLOBALIZATION, ECONOMIC DEVELOPMENT CREATE UNPRECEDENTED BUT UNEVENLY DISTRIBUTED WEALTH, POWER. RISING INEQUALITY ACROSS AND WITHIN COUNTRIES, COMPANIES, INDUSTRIES, AND VALUE CHAINS IS PROMOTING QUESTIONS ABOUT THE BALANCE BETWEEN EQUITY AND EFFICIENCY. FOR EXAMPLE PHARMACEUTICAL COMPANIES CALLED ON TO PROVIDE DRUGS AT DICOUNT PRICES TO REMEDY UNEQUAL ACCESS TO DRUGS.
SHIFTING VALUES, SOCIAL NORMS
ATTITUDES IN THE WORLD ARE SHIFTING, COLORED BY TENSIONS BETWEEN TRADITION AND MODERNITY, MEANING AND MATERIALISM, CONSUMPTION AND RESOURCE STEWARDSHIP, AND DUTY AND INDIVIDUALISM FOR EXAMPLE PRINCIPLE OF ENVIRONMENTAL STEWARDSHIP CREATES DEMAND FOR HYBRID CARS. PROTECTION OF INDIGENOUS LAND AND MINING RIGHTS RAISES COST OF EXTRACTION. CONSUMER LENDING RATES REDUCED BECAUSE OF µUSURY¶ CLAIMS.
UBIQUITY OF TECHNOLGY
TECHNOLOGIES ARE CREATING BOTH ANXIETIES AND NEW OPPORTUNITIES TO UNDERSTAND AND INFLUENCE OUR LIVES. FOR EXAMPLE EXPOSURE TO/FEAR OF IDENTITY THEFTS LEADS TO INCREASED COMPLIANCE COSTS IN FINANCIAL SERVICES INDUSTRY. TECHNOLOGY ENHANCES STAKEHOLDERS¶ ABILITY TO COORDINATE, COMMUNICATE, RAISE FUNDS FOR SPECIFIC CAUSES.
MANAGEMENT¶S REACTION
COMPANY¶S PROVIDE PLENTY OF BENEFITS TO SOCIETY- PRODUCTS OF GOOD QUALITY OR LOW PRICES ± AND EMPLOY VAST NUMBERS OF PEOPLE. YET THE RISING TIDE OF EXPECTATIONS MEANS THAT COMPANIES MUST NOW STRIVE TO ANTICIPATE AND UNDERSTAND THOSE EXPECTATIONS AND TO EMBED THEM IN THEIR BUSINESS STRATEGY. FOR EXAMPLE, BANKS ARE CRITICIZED FOR MAKING LOANS TO COMPANIES THAT DAMAGE THE ENVIRONMENT.
MANY BANKS , HAVE NOW PLEDGED, IN DIFFERENT WAYS, TO RESTRICT THEIR LENDING FOR INDUSTRIAL PROJECTS THAT WOULD HAVE AN ADVERSE ENVIRONMENTAL IMPACT.
HOW TO MANAGE THESE FORCES
THE CASE FOR ADOPTING A STRATEGIC APPROACH TO THE SOCIOPOLITICAL AGENDA IS THREEFOLD. FIRST, THESE FORCES CAN ALTER AN INDUSTRY¶S LANDSCAPE IN FUNDAMENTAL WAYS. IN PHARMACEUTICALS, FOR INSTANCE, SOCIAL CONCERNS ABOUT THE COST AND SAFETY OF THE INDUSTRY¶S PRODUCTS, AS WELL AS ACCESS TO THEM, HAVE MADE REGULATORY ENVIRONMENT TOUGHER.
SECOND, THE IMMEDIATE FINANCIAL AND LONGER-TERM REPUTATIONAL IMPACT OF SOCIAL ISSUES THAT BACKFIRE CAN BE ENORMOUS. FINALLY, NEW PRODUCT OR MARKET STRATEGIES CAN EMERGE FROM CHANGING SOCIAL AND POLITICAL FORCES. TOYOTA MOTOR¶S SUCCESS WITH THE PRIUS CAN BE ATTRIBUTED TO A GROWING INTEREST IN ENVIRONMENTALLY FRIENDLY PRODUCTS.
THE CAR¶S INITIAL SUCCESS PUTS THE COMPANY IN A POSITION TO MOVE HYBRID TECHNOLOGY TOWARDS PROFITABILITY FASTER THAN ITS COMPETITORS. IT HAS ALSO AUGMENTED ITS REPUTATION BY HELPING TO ADDRESS ENVIRONMENTAL ISSUES. UNILEVER¶S INNOVATIVE PRODUCT OFFERINGS IN DEVELOPING COUNTRIES, SUCH AS ITS WHEEL DETERGENT BRAND IN INDIA, WERE A RESPONSE TO THE UNMET NEEDS OF LOWER-INCOME CONSUMERS THERE.
IT CAN DEVELOP ³RADAR´ SYSTEMS TO ANTICIPATE FUTURE RISKS AND OPPORTUNITIES, MASTER THE RANGE OF OPTIONS AVAILABLE FOR DEALING WITH THEM. LOCAL ANTENNAE ARE ALSO VITAL. LARGE-SCALE PROBLEMS GENERALLY START AS SMALL REGIONAL ISSUES BEFORE THEY ARE CHAMPIONED BY LARGER, TYPICALLY NGOs THAT HAVE THE CLOUT AND MEDIA CONTACTS TO LAUNCH GLOBAL CAMPAIGNS. .
COMPANY¶S SHOULD USE SYSTEMATIC METHODS, INCLUDING TRUSTED TECHNIQUES SUCH AS ECONOMIC ANALYSIS AND SCENARIO PLANNING, TO EVALUATE THE STRATEGIC IMPACT OF SOCIOPOLITICAL TRENDS. TO EVALUATE WHAT¶S AT STAKE, COMPANIES MUST SCAN THE WHOLE VALUE CHAIN, LOOKING, FOR EXAMPLE, AT THE WAY THEY SOURCE RAW MATERIALS AND MAKE AND SELL THEIR PRODUCTS.
THEY SHOULD DEVELOP POTENTIAL FUTURE SCENARIOS THAT TAKE INTO ACCOUNT THE REACTION OF COMPETITORS, SHIFTS IN CONSUMER PATTERNS, AND THE POSSIBILITY OF LITIGATION AND REGULATION. GIVEN THE UNPREDICTABLE WAY SOCIOECONOMIC TRENDS DEVELOP, A STRATEGY USING A PORTFOLIO OF INITIATIVES IS PARTICULARLY RELEVANT.
SOCIOPOLITCAL TRENDS WILL INCREASINGLY AFFECT THE STRATEGIC FREEDOM OF COMPANIES, WHICH JUST CAN¶T IGNORE THE RISING TIDE OF EXPECTATIONS RESULTING FROM THESE TRENDS AND THE POWER AND INFLUENCE OF THE STAKEHOLDERS WHO MOBILIZE AROUND THEM.
CORPORATE SOCIAL RESPONSIBILITY(CSR)
THE CONCEPT OF CSR ORIGINATED IN THE 1950s WHEN AMERICAN CORPORATIONS RAPIDLY INCREASED IN SIZE AND POWER. THE CONCEPT CONTINUED TO FIGURE PROMINENTLY IN PUBLIC DEBATE DURING THE 1960s AND 1970s AS THE NATION CONFRONTED PRESSING SOCIAL PROBLEMS SUCH AS POVERTY, UNEMPLOYMENT, RACE RELATIONS, URBAN BLIGHT, AND POLLUTION. CSR BECAME A RALLYING CRY FOR DIVERSE GROUPS DEMANDING CHANGE IN AMERICAN BUSINESS.
IN THE LAST TWO DECADES OF THE TWENTIETH CENTURY, CORPORATIONS GENERALLY RECOGNIZED A RESPONSIBILITY TO SOCIETY. BUT THAT RESPONSIBILITY WAS WEIGHED AGAINST THE DEMANDS OF BEING COMPETITIVE IN A RAPIDLY CHANGING GLOBAL ECONOMY. PRESSURE FOR IMPROVED PERFORMANCE WAS EXERTED BY INSTITUTIONAL INVESTORS WHO HAVE A FIDUCIARY DUTY TO THEIR INVESTORS TO PUSH FOR MAXIMUM RETURN.
THE DEFINITION OF CSR
ALL ACCOUNTS OF CSR RECOGNIZE THAT BUSINESS FIRMS HAVE NOT ONE BUT MANY DIFFERENT KINDS OF RESPONSIBILITY, INCLUDING ECONOMIC AND LEGAL RESPONSIBILITIES. COMPANIES HAVE AN ECONOMIC RESPONSIBILITY TO PRODUCE GOODS AND SERVICES AND TO PROVIDE JOBS AND GOOD WAGES TO THE WORKFORCE WHILE EARNING A PROFIT.
ECONOMIC RESPONSIBILITY ALSO INCLUDES THE OBLIGATION TO SEEK OUT SUPPLIES OF RAW MATERIALS, TO DISCOVER NEW RESOURCES AND TECHNOLOGICAL IMPROVEMENTS, AND TO DEVELOP NEW PRODUCTS. LEGAL RESPONSIBILITIES ± IS TO ACT AS A FIDUCIARY, MANAGING THE ASSETS OF A COMPANY IN THE INTERST OF SHAREHOLDERS. OTHER LEGAL RESPONSIBILITIES TO EMPLOYEES, CUSTOMERS, SUPPLIERS, AND OTHER PARTIES.
THE VAST BODY OF BUSINESS LAW IS CONSTANTLY INCREASING AS LEGISLATURES, REGULATORY AGENCIES, AND THE COURTS RESPOND TO GREATER SOCIETAL EXPECTATIONS AND IMPOSE NEW LEGAL OBLIGATIONS ON BUSINESS. THE CONCEPT OF CSR IS OFTEN EXPRESSED AS THE VOLUNTARY ASSUMPTION OF RESPONSIBILITIES THAT GO BEYOND THE PURELY ECONOMIC AND LEGAL RESPONSIBILITIES OF BUSINESS FIRMS.
MORE SPECIFICALLY, SOCIAL RESPONSIBILITY IS THE SELECTION OF CORPORATE GOALS AND THE EVALUATION OF OUTCOMES NOT SOLELY BY THE CRITERIA OF PROFITABILITY AND ORGANIZATIONAL WELL BEING BUT BY ETHICAL STANDARDS OR JUDGEMENTS OF SOCIAL DESIRABILITY. THE EXERCISE OF SOCIAL RESPONSIBILITY, IN THIS VIEW, MUST BE CONSISTENT WITH THE CORPORATE OBJECTIVE OF EARNING A SATISFACTORY LEVEL OF PROFIT.
BUT IT ALSO IMPLIES A WILLINGNESS TO FOREGO A CERTAIN MEASURE OF PROFIT IN ORDER TO ACHIEVE NONECONOMIC ENDS. SOME OF THE TYPES OF CORPORATE ACTIVITIES THAT SHOW SOCIAL RESPONSIBILITY ARE:1. CHOOSING TO OPERATE ON AN ETHICAL LEVEL THAT IS HIGHER THAN WHAT THE LAW REQUIRES. 2. MAKING CONTRIBUTIONS TO CIVIC AND CHARITABLE ORGANIZATIONS.
3. PROVIDING BENEFITS FOR EMPLOYEES AND IMPROVING THE QUALITY OF LIFE IN THE WORKPLACE BEYOND ECONOMIC AND LEGAL REQUIREMENTS. 4. TAKING ADVANTAGE OF AN ECONOMIC OPPORTUNITY THAT IS JUDGED TO BE LESS PROFITABLE BUT MORE SOCIALLY DESIRABLE THAN SOME ALTERNATIVES. 5. USING CORPORATE RESOURCES TO OPERATE A PROGRAMME THAT ADDRESSES SOME MAJOR SOCIAL PROBLEM
CSR IS NOW EVEN A MARKETABLE ASSET. LONDON¶S FINANCIAL TIMES STOCK EXCHANGE (FTSE) HAS AN INDEX CALLED FTSE4GOOD. THIS INDEX LISTS COMPANIES THAT FOLLOW CSR GUIDELINES LAID DOWN BY THE FTSE4GOOD BOARD. THE BOARD CONSTANTLY EVOLVES THESE RULES AND COMPANIES ARE REQUIRED TO DEMONSTRATE COMPLIANCE TO RETAIN THEIR LISTING.
ARGUMENT AGAINST CSR
PERHAPS THE BEST KNOWN CRITIC OF CSR IS MILTON FRIEDMAN HIS MAIN ARGUMENT IS THAT CORPORATE EXECUTIVES, WHEN THEY ARE ACTING IN THEIR OFFICIAL CAPACITY AND NOT AS PRIVATE PERSONS, ARE AGENTS OF SHAREHOLDERS OF THE COMPANY. AS SUCH, EXECUTIVES OF A COMPANY HAVE AN OBLIGATION TO MAKE DECISIONS IN THE INTERESTS OF THE SHAREHOLDERS, WHO ARE ULTIMATELY THEIR EMPLOYERS.
CORPORATES¶ CORE BUSINESS AND SOCIAL RESPONSIBILITY TODAY, MANY BUSINESSES HAVE COME TO UNDERSTAND THAT BEING A GOOD CORPORATE CITIZEN CAN ALSO MEAN SIGNIFICANT BENEFITS. THERE ARE SEVERAL EXAMPLES OF HOW CORPORATE SOCIAL RESPONSIBILITY CAN ACTUALLY BECOME PART OF THEIR CORE BUSINESS.
THE ITC GROUP¶S e-CHOUPAL PROJECT GIVES ACCESS TO IT KIOSKS TO FOUR MILLION FARMERS ACROSS NINE STATES IN INDIA. THESE KIOSKS PROVIDE INFORMATION ABOUT THE WEATHER, CROP PRICES AND FERTILISERS. THIS HAS INCREASED FARMER INCOMES BY 30-40 PER CENT. AS A BUSINESS, THIS GIVES ITC ACCESS TO RELIABLE SOURCES OF FARM PRODUCE.
ITC¶s SOCIAL AND FARM FORESTRY PROJECT ALSO PROVIDES A COMPREHENSIVE PACKAGE OF SUPPORT TO TRIBAL AREAS. IT INCLUDES LOANS, PLANTING OF SAPLINGS AND PLANTATION MAINTENANCE. THE TRIBALS GROW THE SAPLINGS, WHICH ARE LATER USED BY ITC FOR WOOD PULP. THE PROJECT HAS GENERATED 28 MILLION DAYS OF EMPLOYMENT.
ITC HAS ALSO EARNED CARBON CREDITS FROM THE NEARLY 75,000 ACRES OF GREEN COVER. ITC IS PROBABLY INDIA¶S LARGEST COMPANY TO HAVE A POSITIVE CARBON AND WATER BALANCE. THEIR PROJECTS COVER THE TWIN GOALS OF CREATING SOCIAL DEVELOPMENT AND SHAREHOLDER VALUE. ANOTHER COMPANY KNOWN FOR ITS PROENVIRONMENT OPERATIONS IS THE ORCHID HOTEL CHAIN.
EVEN THE BRICKS USED IN THE BUILDINGS ARE RECYCLED FROM WASTE-MATERIALS SUCH AS FLY ASH. EACH ROOM HAS AN µECO BUTTON¶, WHICH THE GUESTS CAN USE TO REDUCE THE AIRCONDITIONING LOAD. THE GROUP HAS ALSO INVESTED IN ELECTRICITY, WATER, LIGHTING AND SOLID WASTE MANAGEMENT. THERE ARE COSTS INVOLVED IN PUTTING THESE SYSTEMS IN PLACE.
BUT IT HELPS THEM SAVE MONEY IN THE LONG RUN. HINDUSTAN UNILEVER (HUL) BELIEVES THAT THERE BRAND SHOULD DO THE TALKING. THEY RUN EXERCISES THAT HELP A BRAND IDENTITY A SOCIAL ISSUE OR µCAUSE¶ THAT FITS NATURALLY WITH IT. IN RESPONSE TO A GROWING NUMBER OF IODINEDEFICIENCY DISEASES, HUL DEVELOPED A TECHNOLOGY THAT PRESERVED THE IODINE CONTENT IN SALT EVEN AFTER COOKING.
THUS, HUL¶S ANNAPURNA SALT IS THE FIRST BRAND TO BE ENDORSED BY THE INTERNATIONAL COUNCIL FOR THE CONTROL OF IODINE DEFICIENCY DISORDERS. RURAL HANDICRAFT RETAILER, FABINDIA, IS ANOTHER MODEL OF SUSTAINABLE BUSINESS. THE COMPANY SOURCES ALL ITS PRODUCTS DIRECTLY FROM VILLAGE ARTISANS. FABINDIA WANTS TO CREATE 100.000 SKILLED JOBS IN RURAL INDIA.
BECAUSE FABINDIA¶S PRODUCTS ARE ALL HANDMADE, PRODUCTION CANNOT BE RAMPED UP IF DEMAND SUDDENLY RISES. TO REDUCE SUPPLY GAPS, THE COMPANY NOW PLANS TO MOVE FROM A SINGLE, CENTRAL WARHOUSE MODEL TO REGIONAL WAREHOUSES, WHICH WILL BE PARTLY OWNED BY THE ARTISANS WHO SUPPLY TO THEM. AS INDIVIDUAL COMPANIES SHOW SUCCESSES FROM REINVENTING THEIR BUSINESS MODELS FOR GOODNESS, WHOLE INDUSTRIES ARE NOW GETTING IN ON THE ACT.
CASE STUDIES
IN INDIA, THE ROLE OF CSR HAS BEEN GAINING MOMENTUM FOR A DECADE NOW. THE REALISATION THAT THE PARTICIPATION OF THE PRIVATE SECTOR CAN FOSTER THE PUBLICPRIVATE PARTNERSHIP IS VITAL IN TERMS OF SHARING RESOURCES, BRINGING IN EXPERTISE AND APPROPRIATE TECHNOLOGIES. THIS CAN ENHANCE VISIBILITY OF CAMPAIGNS, AND BRINGING ABOUT CIVIL SOCIETY RESPONSE
INFOSYS: THE INFOSYS FOUNDATION PROVIDED CONSIDERABLE FINANCIAL ASSISTANCE TO WAR WIDOWS. ALSO INVOLVED WITH CONSTRUCTION OF A SUPER SPECIALITY HOSPITAL IN ANDHRA PRADESH AND RECONSTRUCTING A SCHOOL IN KARNATAKA. WIPRO: THE AZIM PREMJI FOUNDATION RUN BY THE WIPRO CHAIRMAN IS WORKING ON PROVIDING ELEMENTARY SCHOOLING TO THOUSANDS OF UNDERPRIVILEGED CHILDREN
STEEL AUTHORITY OF INDIA: (SAIL) HAS INITIATED SAIL AIDS CONTROL PROGRAMME IN ASSOCIATION WITH THE NATIONAL AIDS CONTROL ORGANIZATION. SAIL¶S MAJOR INITIATIVES INCLUDE SCHOOL AIDS EDUCATION PROGRAMME, SAFE BLOOD AND BLOOD PRODUCTS, FAMILY HEALTH AWARENESS CAMPAIGN, AND VOLUNTARY COUNSELLING AND TESTING CENTRES.
APOLLO TYRES: IN ASSOCIATION WITH 36 NGOS, THE TYRE COMPANY LAUNCHED APOLLO TYRE HEALTH CARE CENTRE IN OCTOBER 2000 TO PROVIDE GENERAL AND SEXUAL HEALTH SERVICES FOR TRUCKERS AND TRANSPORT COMMUNITIES AT LARGE. THE INCEPTION OF THE CLINIC WAS A LOGICAL CONCLUSION OF THE COMPANY¶S WELFARE POLICY.
RURAL INDIA-DEVELOPMENTAL MARKETING
RURAL INDIA IS NOT JUST ABOUT SELLING SOAPS OR COLAS IN FLEXIBLE SIZES AT LOWER PRICES. IT IS ABOUT CREATING A MARKET FROM SCRATCH BY FIRST DEVELOPING IT, SOLVING ITS BASIC PROBLEMS, FIGURING OUT WHAT IT NEEDS AND THEN DESIGNING A PRODUCT OR SERVICE BUILT AROUND THAT ONE NEED THAT A COMPANY COULD, PROBABLY. SERVICE. THIS IS WHAT DEVELOPMENTAL MARKETING IS.
DCM SHRIRAM CONSOLIDATED (DSCL)
DSCL MADE THE JUMP IN 2003. AFTER ABOUT 40 YEARS OF SELLING UREA AND OTHER AGRI-PRODUCTS, IT REALISED THAT IT NEEDED TO BETTER UTILISE ITS KNOWLEDGE OF RURAL MARKETS. THE RESULT WAS HARYALI KISAN BAZAR. A 54 STRONG CHAIN OF RURAL SUPERMARKET THAT OFFER EVERYTHING ONE MAY NEED ON A FARM, AND MORE.
IN 1997, MORE THAN THREE DECADES AFTER IT ENTERED THE RURAL MARKETS, DSCL STARTED SETTING UP THE SHRIRAM KRISHI UP VIKAS CENTRES. THE IDEA WAS TO DO SOME VALUE-ADDS TO ITS PRIMARY BUSINESS OF SELLING UREA, FERTILISERS AND SUGAR MANUFACTURING-ALL DEALING WITH FARMERS. THE CENTRES OFFER THE SERVICES OF AGRONOMISTS TO LOCAL FARMERS ACROSS 100 VILLAGES IN INDIA.
THESE CENTRES ARE HOOKED TO A REGIONAL CENTRE IN ALWAR(RAJASTHAN). WHICH, IN TURN, CAN PLUG INTO DELHI AND SEVERAL RURAL RESEARCH INSTITUTES. ACCORDING TO THE COMPANY, THE AVERAGE NUMBER OF QUERIES THE CENTRE GETS COULD RUN INTO THOUSANDS. FOR INSTANCE, IN PUNJAB, FARMERS WERE NOT USING POTASH AS A FERTILISER BECAUSE OF A THREE-YEAR-OLD ADVISORY THAT STATED THAT THERE WAS ENOUGH POTASH IN THE SOIL.
TESTS SHOWED THAT THIS WAS NOT TRUE ANY LONGER, AND, THEREFORE, PRODUCTIVITY WAS DROPPING. CLEARLY, HERE WAS AN OPPORTUNITY TO CONNECT ITS AGRO-PRODUCTS AND ADVICE, ALONGWITH OTHER THINGS. THAT IS HOW THE FIRST HARYALI KISAN BAZAR WAS BORN IN JULY 2003. THE IDEA WAS TO CREATE A RETAIL AMBIENCE THAT FARMERS WERE COMFORTABLE IN, WHERE THEY WERE NOT CHEATED AND WERE TREATED WITH DIGNITY AND TRUST.
THAT MEANT STOCKING ALL BRANDS OF UREA AND FERTILISER (BESIDES ITS OWN) AND TYING UP WITH FUEL COMPANIES SUCH AS BPCL. AS CONSUMERS STARTED DEMANDING MORE, THE WHOLE PRODUCT RANGE KEPT EXPANDING TO SEVERAL NON-AGRI PRODUCTS. THESE COULD BE ANYTHING FROM APPAREL TO SCHOOL BAGS, TATA-SKY¶s DTH SERVICE OR INSURANCE (ICICI-LOMBARD FOR WEATHER AND ICICI-PRUDENTIAL FOR LIFE INSURANCE). SOON IT WILL BE ROLLING OUT THE NATIONAL COMMODITIES EXCHANGE SERVICES.
HINDUSTAN PETROLEUM LTD.(HPL) HPL, IN ASSOCIATION WITH MARKETING RESEARCH AGENCY MART, HAS SET UP 589 COMMON COMMUNITY KITCHENS (RASOIGHARS) IN 30 VILLAGES ACROSS INDIA THE PLAN IS TO TAKE THAT TO 720 BY THE END OF THE YEAR. THE IDEA: TO BRING CLEAN FUEL AND SAVE TIME IN GATHERING FIREWOOD.
THE RESULT: IN VILLAGES SUCH AS AGWAN, IN MAHARASHTRA, THE SELF-HELP GROUPS HAVE HELPED COLLECT FUNDS TO GET CONNECTIONS FOR THE ENTIRE VILLAGE. THE SIDE-EFFECT: SINCE THEY HAVE THE TIME, GIRLS GO TO SCHOOL IN MANY OF THESE VILLAGES.
THE CHEVRON WAY
THE CORPORATE RESPONSIBILITY EFFORTS ARE GROUNDED IN THE CHEVRON WAY, WHICH OUTLINES THEIR COMMITMENT TO ³CONDUCT BUSINESS IN A SOCIALLY RESPONSIBLE AND ETHICAL MANNER«SUPPORT UNIVERSAL HUMAN RIGHTS«PROTECT THE ENVIRONMENT, BENEFIT THE COMMUNITIES WHERE WE WORK«LEARN FROM AND RESPECT CULTURES IN WHICH WE WORK.´
CHEVRON DEFINES CORPORATE RESPONSIBILITY AS:
CONSISTENTLY APPLYING OUR CORE VALUES, SET OUT IN THE CHEVRON WAY MAXIMIZING THE POSITIVE IMPACT OF OUR OPERATIONS ON CURRENT AND FUTURE GENERATIONS, INTEGRATING SOCIAL, ENVIRONMENTAL AND ECONOMIC CONSIDERATIONS INTO OUR CORE PRACTICES AND DECISION MAKING
ENGAGING WITH AND BALANCING THE NEEDS OF OUR KEY STAKEHOLDERS
1. 2. 3. 4. 5.
CHEVRON HAS DEVELOPED SOUND POLICIES, PRACTICES OR PROGRAMS THAT ADDRESS EACH OF THE FOLLOWING SEVEN ELEMENTS:BUSINESS ETHICS AND TRANSPARENCY WORKPLACE PRACTICES AND EMPLOYEE RELATIONS ENVIRONMENT, HEALTH AND SAFETY HUMAN RIGHTS COMMUNITY ENGAGEMENT AND DEVELOPMENT
6. 7.
INTEGRATION OF CORPORATE RESPONSIBILITY INTO THEIR SUPPLY CHAIN STAKEHOLDER CONSULTATION ENVIRONMENTAL MANAGEMENT: THE THREE STRATEGIC PRIORITIES WHERE THEY HAVE MADE MEASURABLE PROGRESS ARE: DEFININGWORLD-CLASS STANDARDS, MEASURING AND COMMUNICATING PERFORMANCE AND DEMONSTRATING CONTINUAL PERFORMANCE IMPROVEMENT.
1.
CLIMATE CHANGE, ENERGY EFFICIENCY AND RENEWABLES: THE USE OF FOSSIL FUELS TO MEET THE WORLD¶S ENERGY NEEDS HAS CONTRIBUTED TO AN INCREASE IN GREENHOUSE GASES (CHGs) ± MAINLY CARBON DIOXIDE AND METHANE. CHEVRON¶S CLIMATE CHANGE FOURFOLD ACTION PLAN WHICH IS NOW IN THE FOURTH YEAR OF IMPLEMENTATION IS AS FOLLOWS:REDUCING EMISSIONS OF CHGs AND INCREASING ENERGY EFFICIENCY
2. 3.
4.
INVESTING IN RESEARCH, DEVELOPMENT AND IMPROVED TECHNOLOGY PURSUING BUSINESS OPPORTUNITIES IN PROMISING, INNOVATIVE ENERGY TECHNOLOGIES SUPPORTING FLEXIBLE AND ECONOMICALLY SOUND POLICIES AND MECHANISMS THAT PROTECT THE ENVIRONMENT. COMMUNITY ENGAGEMENT: COMMITTED TO CONTRIBUTING TO THE SOCIAL AND ECONOMIC DEVELOPMENT OF THE COMMUNITIES IN WHICH THEY OPERATE.
1. 2. 3.
MOST OF THEIR COMMUNITY INITIATIVES AND INVESTMENTS ARE FOCUSED ON BUILDING HUMAN AND INSTITUTIONAL CAPACITY IN WAYS THAT HELP STIMULATE ECONOMIC GROWTH AND ENABLE COMMUNITIES TO PROSPER. CHEVRON HAS IDENTIFIED THREE AREAS THAT THEY CONSIDER CRITICAL TO ECONOMIC DEVELOPMENT: BASIC HUMAN NEEDS EDUCATION AND CAREER TRAINING SMALL AND MEDIUM-SIZE BUSINESS DEVELOPMENT, INCLUDING ACCESS TO CREDIT
ITC LTD.
CONTRIBUTION TO SOCIAL AND ECOLOGICAL CAPITAL THE UNIQUENESS OF ITCs CONTRIBUTION TO ENLARGING SOCIAL AND ECOLOGICAL CAPITAL LIES IN BEING ABLE TO ENMESH SUCH CONTRIBUTION INTO THE PROCESS OF GENERATING SHAREHOLDER VALUE THROUGH CREATIVE BUSINESS MODELS ± THE INNOVATIVE ITC-e-CHOUPAL BUSINESS MODEL AND THE ITC FARM AND SOCIAL FORESTRY INITIATIVES.
EMPOWERING THE SMALL FARMER
THE ITC e-CHOUPAL INITIATIVE IS A POWERFUL ILLUSTRATION OF LINKING BUSINESS PURPOSE WITH A LARGER SOCIETAL PURPOSE. IT LEVERAGES THE POWER OF THE INTERNET TO EMPOWER THE SMALL AND MARGINAL FARMER WITH A HOST OF SERVICES RELATED TO KNOWHOW, BEST PRACTICES, TIMELY AND RELEVANT WEATHER INFORMATION, TRANSPARENT DISCOVERY OF PRICES AND MUCH MORE.
THIS DIGITAL INFRASTRUCTURE CAN ALSO BE USED FOR CHANELLISING SERVICES RELATED TO CREDIT, INSURANCE, HEALTH, EDUCATION AND ENTERTAINMENT. IT CAN ALSO SERVE AS A STRONG FOUNDATION FOR LINKING SMALL AND MARGINAL FARMERS TO FUTURES MARKETS TO FACILITATE FARMER RISK MANAGEMENT. THE ACCESS TO e-CHOUPALS, WITHIN WALKING DISTANCE FROM THE FARMGATE, IS SUPPLEMENTED THROUGH PHYSICAL INFRASTRUCTURE-THE ITC CHOUPAL SAAGAR.
THIS FUNCTIONS AS A HUB FOR A CLUSTER OF VILLAGES WITHIN TRACTORABLE DISTANCE. THESE MADE ±TO- DESIGN HUBS ALSO SERVE AS WAREHOUSES, AND AS RURAL SUPERMARKETS FOR A VARIETY OF GOODS. IN EFFECT, THE e-CHOUPAL INFRASTRUCTURE IS POTENTIALLY AN EFFICIENT DELIVERY CHANNEL FOR RURAL DEVELOPMENT AND AN INSTRUMENT FOR CONVERTING VILLAGE POPULATIONS INTO VIBRANT ECONOMIC ORGANIZATIONS.
AGRO FORESTRY LED RURAL RENAISSANCE
THE LABOUR INTENSITY OF AGRO FORESTRY AND THE AVAILABILITY OF THE SECOND HIGHEST ARABLE LAND MASS IN THE WORLD REPRESENT TWO STRATEGIC ASSETS THAT CAN BE LEVERAGED TO TRANSFORM THE COMPETITIVENESS OF THE TREE-TO-TEXTBOOK VALUE CHAIN. ITC¶S PRESENCE IN THIS VALUE CHAIN PROVIDES THE BASIS FOR A SIGNIFICANTLY ENLARGED CONTRIBUTION TOWARDS RAISING LIVING STANDARDS IN RURAL HINTERLANDS.
SO FAR, MORE THAN 149 MILLION SAPLINGS HAVE BEEN PLANTED IN NEARLY 41,000 HECTARES UNDER ITC¶S FARM AND SOCIAL FORESTRY PROGRAMMES PROVIDING 18 MILLION PERSON DAYS OF EMPLOYMENT. THE COMPANY¶S AGRO FORESTRY INITIATIVES ALSO EXTEND TO CONSERVATION OF NATURAL CAPITAL AS WELL, INCREASING GREEN COVER, IN SITU MOISTURE CONSERVATION, GROUNDWATER RECHARGE, SIGNIFICANT REDUCTION IN SOIL EROSION AND ENRICHMENT OF DEPLETED SOILS ARE SOME OF THE DIRECT ENVIRONMENTAL BENEFITS.
OTHER SOCIAL BENEFITS
OTHER SOCIAL INITIATIVES IN THE VICINITY OF ITS OPERATING LOCATIONS ARE CENTERED AROUND THREE MAIN AREAS OF INTERVENTION UNDER µMISSION SUNEHRA KAL¶: (A) NATURAL RESOURCE MANAGEMENT, WHICH INCLUDES WASTELAND, WATERSHED AND AGRICULTURE DEVELOPMENT; (B) SUSTAINABLE LIVELIHOODS, COMPRISING GENETIC IMPROVEMENT IN LIVESTOCK AND WOMEN¶S ECONOMIC EMPOWERMENT; AND (C)COMMUNITY DEVELOPMENT, WITH FOCUS ON PRIMARY EDUCATION AND HEALTH AND SANITATION.
GIVEN A WORLD BESET BY MYRIAD SOCIAL PROBLEMS ± HUNGER, HOMELESSNESS, CRIME, AIDS, ENVIRONMENTAL DEGRADATION ± THE QUESTION MAY BE POSED: DOES IT MAKE SENSE FOR A COMPANY TO VISIBLY ADOPT ONE OR MORE OF THESE PROBLEMS AS A COMPANY CONCERN? LET US REFRAME THE QUESTION: SHOULD THE COMPANY ACTIVELY CONTRIBUTE MONEY AND EMPLOYEE TIME TO AMELIORATE A SOCIAL PROBLEM?
AN ORGANISATION RECEIVES INPUTS FROM SOCIETY AND ENVIRONMENT IN THE FORM OF LABOUR AND RAW MATERIAL. BUSINESS, IN TURN, PROVIDES GOODS AND SERVICES TO SOCIETY. THUS,A BUSINESS EXISTS BECAUSE OF SOCIETY. THIS REALISATION IS VERY IMPORTANT FOR FIRMS. IT IS IN THEIR INTEREST TO TAKE CARE OF SOCIETY. BUSINESS CANNOT OPERATE IN VACUUM, THEY OPERATE IN THE REAL WORLD.
IF ORGANISATIONS ARE SOCIALLY CONSCIOUS, THEY WILL ENJOY ENHANCED VISIBILITY, LOYAL EMPLOYEES, CUSTOMERS, SUPPLIERS, LENDERS AND INVESTORS. THE CHALLENGE IS TO FIND A WAY FOR COMPANIES TO INCORPORATE SOCIAL ISSUES INTO THEIR CORE DECISION-MAKING PROCESSES. COMPANIES MUST SEE THE SOCIAL DIMENSIONS NOT JUST AS RISKS BUT ALSO AS OPPORTUNITIES.
THE CHANGING SOCIAL CONTRACT
COMPANIES HAVE ALWAYS HAD A CONTRACT WITH SOCIETY. THE CONTRACT EMBRACES NOT JUST DIRECT STAKEHOLDERS (SUCH AS CONSUMERS, EMPLOYEES, REGULATORS, AND SHAREHOLDERS) BUT ALSO A BROADER SET OF STAKEHOLDERS (SUCH AS THE COMMUNITIES WHERE COMPANIES OPERATE, THE MEDIA, ACADEMICS, AND THE NONPROFIT SECTOR)
PART OF THIS CONTRACT IS FORMALIZED IN LAWS AND REGULATIONS, AND VIOLATING THEM HAS OBVIOUS LEGAL RAMIFICATIONS. PART OF IT IS SEMIFORMAL: THE STAKEHOLDERS¶ IMPLICIT EXPECTATIONS, WHICH IF IGNORED CAN BRING ABOUT SWIFT ACTION. VIOLATIONS OF SEMIFORMAL CONTRACTUAL OBLIGATION CAN SERIOUSLY HARM A COMPANY¶S REPUTATION AS WELL AS CONSUMER DEMAND FOR ITS PRODUCTS.
MOST CHALLENGING ARE THE ³FRONTIER´ ISSUES THAT HAVE NOT YET ENTERED THE FORMAL OR SEMIFORMAL CONTRACTS BUT COULD, OVER TIME BECOME SOCIAL EXPECTATIONS. TAKE OBESITY. IT HAD ALWAYS BEEN WIDELY BELIEVED THAT THE RESPONSIBILITY FOR AVOIDING IT LAY WITH INDIVIDUALS, WHO CHOOSE WHAT THEY EAT, NOT WITH THE COMPANIES THAT MAKE OR SELL FATTENING PRODUCTS.
MUCH AS THE DEBATE AROUND TOBACCO SHIFTED THE RESPONSIBILITY FROM INDIVIDUALS TO AN INDUSTRY PERCEIVED TO BE AGGRESSIVELY MARKETING ADDICTIVE PRODUCTS. THIS HAS RESULTED IN BLURRING BOUNDARIES BETWEEN RESONSIBILITIES AND LAWS.
BUTTERFLY EFFECT
GROWING INTERDEPENDENCE AND INTERCONNECTEDNESS HAVE AMPLIFIED RISKS AND OPPORTUNITIES FOR CONSUMERS, EMPLOYEES, BUSINESSES, AND GOVERNMENTS. AS A RESULT, ISSUES THAT WERE ONCE PERIPHERAL OR LOCAL NOW HAVE GLOBAL IMPACT. FOR EXAMPLE, LOCAL LIVESTOCK CONTAMINATIONS, SUCH AS MAD COW DISEASE, AVIAN FLU THREATEN STABILITY OF GLOBAL HEALTH AND GLOBAL FOOD SUPPLY CHAINS.
GROWING SAFETY AND SECURITY CONCERNS; SENSITIVITY TO RISK
AS TECHNOLOGY ADVANCES PEOPLE ARE INCREASINGLY AWARE OF THEIR EXPOSURES TO RISKS AND ARE WILLING TO INVEST IN ORDER TO AVOID THEM. PEOPLE OFTEN MISUNDERSTAND OR MISCALCULATE RISKS BECAUSE OF THEIR UNREALISTIC DESIRE TO AVOID THEM COMPLETELY.
FOR EXAMPLE RESTRICTIONS ON NUCLEAR POWER DOWNPLAY LONG-TERM RISKS OF FOSSIL-FUEL-BASED POWER GENERATION. DRUGS APPROVED BY FDA LATER PULLED FROM MARKET BECAUSE OF POTENTIAL HEALTH RISKS TO SMALL PORTION OF POPULATION.
RISING INEQUALITY
GLOBALIZATION, ECONOMIC DEVELOPMENT CREATE UNPRECEDENTED BUT UNEVENLY DISTRIBUTED WEALTH, POWER. RISING INEQUALITY ACROSS AND WITHIN COUNTRIES, COMPANIES, INDUSTRIES, AND VALUE CHAINS IS PROMOTING QUESTIONS ABOUT THE BALANCE BETWEEN EQUITY AND EFFICIENCY. FOR EXAMPLE PHARMACEUTICAL COMPANIES CALLED ON TO PROVIDE DRUGS AT DICOUNT PRICES TO REMEDY UNEQUAL ACCESS TO DRUGS.
SHIFTING VALUES, SOCIAL NORMS
ATTITUDES IN THE WORLD ARE SHIFTING, COLORED BY TENSIONS BETWEEN TRADITION AND MODERNITY, MEANING AND MATERIALISM, CONSUMPTION AND RESOURCE STEWARDSHIP, AND DUTY AND INDIVIDUALISM FOR EXAMPLE PRINCIPLE OF ENVIRONMENTAL STEWARDSHIP CREATES DEMAND FOR HYBRID CARS. PROTECTION OF INDIGENOUS LAND AND MINING RIGHTS RAISES COST OF EXTRACTION. CONSUMER LENDING RATES REDUCED BECAUSE OF µUSURY¶ CLAIMS.
UBIQUITY OF TECHNOLGY
TECHNOLOGIES ARE CREATING BOTH ANXIETIES AND NEW OPPORTUNITIES TO UNDERSTAND AND INFLUENCE OUR LIVES. FOR EXAMPLE EXPOSURE TO/FEAR OF IDENTITY THEFTS LEADS TO INCREASED COMPLIANCE COSTS IN FINANCIAL SERVICES INDUSTRY. TECHNOLOGY ENHANCES STAKEHOLDERS¶ ABILITY TO COORDINATE, COMMUNICATE, RAISE FUNDS FOR SPECIFIC CAUSES.
MANAGEMENT¶S REACTION
COMPANY¶S PROVIDE PLENTY OF BENEFITS TO SOCIETY- PRODUCTS OF GOOD QUALITY OR LOW PRICES ± AND EMPLOY VAST NUMBERS OF PEOPLE. YET THE RISING TIDE OF EXPECTATIONS MEANS THAT COMPANIES MUST NOW STRIVE TO ANTICIPATE AND UNDERSTAND THOSE EXPECTATIONS AND TO EMBED THEM IN THEIR BUSINESS STRATEGY. FOR EXAMPLE, BANKS ARE CRITICIZED FOR MAKING LOANS TO COMPANIES THAT DAMAGE THE ENVIRONMENT.
MANY BANKS , HAVE NOW PLEDGED, IN DIFFERENT WAYS, TO RESTRICT THEIR LENDING FOR INDUSTRIAL PROJECTS THAT WOULD HAVE AN ADVERSE ENVIRONMENTAL IMPACT.
HOW TO MANAGE THESE FORCES
THE CASE FOR ADOPTING A STRATEGIC APPROACH TO THE SOCIOPOLITICAL AGENDA IS THREEFOLD. FIRST, THESE FORCES CAN ALTER AN INDUSTRY¶S LANDSCAPE IN FUNDAMENTAL WAYS. IN PHARMACEUTICALS, FOR INSTANCE, SOCIAL CONCERNS ABOUT THE COST AND SAFETY OF THE INDUSTRY¶S PRODUCTS, AS WELL AS ACCESS TO THEM, HAVE MADE REGULATORY ENVIRONMENT TOUGHER.
SECOND, THE IMMEDIATE FINANCIAL AND LONGER-TERM REPUTATIONAL IMPACT OF SOCIAL ISSUES THAT BACKFIRE CAN BE ENORMOUS. FINALLY, NEW PRODUCT OR MARKET STRATEGIES CAN EMERGE FROM CHANGING SOCIAL AND POLITICAL FORCES. TOYOTA MOTOR¶S SUCCESS WITH THE PRIUS CAN BE ATTRIBUTED TO A GROWING INTEREST IN ENVIRONMENTALLY FRIENDLY PRODUCTS.
THE CAR¶S INITIAL SUCCESS PUTS THE COMPANY IN A POSITION TO MOVE HYBRID TECHNOLOGY TOWARDS PROFITABILITY FASTER THAN ITS COMPETITORS. IT HAS ALSO AUGMENTED ITS REPUTATION BY HELPING TO ADDRESS ENVIRONMENTAL ISSUES. UNILEVER¶S INNOVATIVE PRODUCT OFFERINGS IN DEVELOPING COUNTRIES, SUCH AS ITS WHEEL DETERGENT BRAND IN INDIA, WERE A RESPONSE TO THE UNMET NEEDS OF LOWER-INCOME CONSUMERS THERE.
IT CAN DEVELOP ³RADAR´ SYSTEMS TO ANTICIPATE FUTURE RISKS AND OPPORTUNITIES, MASTER THE RANGE OF OPTIONS AVAILABLE FOR DEALING WITH THEM. LOCAL ANTENNAE ARE ALSO VITAL. LARGE-SCALE PROBLEMS GENERALLY START AS SMALL REGIONAL ISSUES BEFORE THEY ARE CHAMPIONED BY LARGER, TYPICALLY NGOs THAT HAVE THE CLOUT AND MEDIA CONTACTS TO LAUNCH GLOBAL CAMPAIGNS. .
COMPANY¶S SHOULD USE SYSTEMATIC METHODS, INCLUDING TRUSTED TECHNIQUES SUCH AS ECONOMIC ANALYSIS AND SCENARIO PLANNING, TO EVALUATE THE STRATEGIC IMPACT OF SOCIOPOLITICAL TRENDS. TO EVALUATE WHAT¶S AT STAKE, COMPANIES MUST SCAN THE WHOLE VALUE CHAIN, LOOKING, FOR EXAMPLE, AT THE WAY THEY SOURCE RAW MATERIALS AND MAKE AND SELL THEIR PRODUCTS.
THEY SHOULD DEVELOP POTENTIAL FUTURE SCENARIOS THAT TAKE INTO ACCOUNT THE REACTION OF COMPETITORS, SHIFTS IN CONSUMER PATTERNS, AND THE POSSIBILITY OF LITIGATION AND REGULATION. GIVEN THE UNPREDICTABLE WAY SOCIOECONOMIC TRENDS DEVELOP, A STRATEGY USING A PORTFOLIO OF INITIATIVES IS PARTICULARLY RELEVANT.
SOCIOPOLITCAL TRENDS WILL INCREASINGLY AFFECT THE STRATEGIC FREEDOM OF COMPANIES, WHICH JUST CAN¶T IGNORE THE RISING TIDE OF EXPECTATIONS RESULTING FROM THESE TRENDS AND THE POWER AND INFLUENCE OF THE STAKEHOLDERS WHO MOBILIZE AROUND THEM.
CORPORATE SOCIAL RESPONSIBILITY(CSR)
THE CONCEPT OF CSR ORIGINATED IN THE 1950s WHEN AMERICAN CORPORATIONS RAPIDLY INCREASED IN SIZE AND POWER. THE CONCEPT CONTINUED TO FIGURE PROMINENTLY IN PUBLIC DEBATE DURING THE 1960s AND 1970s AS THE NATION CONFRONTED PRESSING SOCIAL PROBLEMS SUCH AS POVERTY, UNEMPLOYMENT, RACE RELATIONS, URBAN BLIGHT, AND POLLUTION. CSR BECAME A RALLYING CRY FOR DIVERSE GROUPS DEMANDING CHANGE IN AMERICAN BUSINESS.
IN THE LAST TWO DECADES OF THE TWENTIETH CENTURY, CORPORATIONS GENERALLY RECOGNIZED A RESPONSIBILITY TO SOCIETY. BUT THAT RESPONSIBILITY WAS WEIGHED AGAINST THE DEMANDS OF BEING COMPETITIVE IN A RAPIDLY CHANGING GLOBAL ECONOMY. PRESSURE FOR IMPROVED PERFORMANCE WAS EXERTED BY INSTITUTIONAL INVESTORS WHO HAVE A FIDUCIARY DUTY TO THEIR INVESTORS TO PUSH FOR MAXIMUM RETURN.
THE DEFINITION OF CSR
ALL ACCOUNTS OF CSR RECOGNIZE THAT BUSINESS FIRMS HAVE NOT ONE BUT MANY DIFFERENT KINDS OF RESPONSIBILITY, INCLUDING ECONOMIC AND LEGAL RESPONSIBILITIES. COMPANIES HAVE AN ECONOMIC RESPONSIBILITY TO PRODUCE GOODS AND SERVICES AND TO PROVIDE JOBS AND GOOD WAGES TO THE WORKFORCE WHILE EARNING A PROFIT.
ECONOMIC RESPONSIBILITY ALSO INCLUDES THE OBLIGATION TO SEEK OUT SUPPLIES OF RAW MATERIALS, TO DISCOVER NEW RESOURCES AND TECHNOLOGICAL IMPROVEMENTS, AND TO DEVELOP NEW PRODUCTS. LEGAL RESPONSIBILITIES ± IS TO ACT AS A FIDUCIARY, MANAGING THE ASSETS OF A COMPANY IN THE INTERST OF SHAREHOLDERS. OTHER LEGAL RESPONSIBILITIES TO EMPLOYEES, CUSTOMERS, SUPPLIERS, AND OTHER PARTIES.
THE VAST BODY OF BUSINESS LAW IS CONSTANTLY INCREASING AS LEGISLATURES, REGULATORY AGENCIES, AND THE COURTS RESPOND TO GREATER SOCIETAL EXPECTATIONS AND IMPOSE NEW LEGAL OBLIGATIONS ON BUSINESS. THE CONCEPT OF CSR IS OFTEN EXPRESSED AS THE VOLUNTARY ASSUMPTION OF RESPONSIBILITIES THAT GO BEYOND THE PURELY ECONOMIC AND LEGAL RESPONSIBILITIES OF BUSINESS FIRMS.
MORE SPECIFICALLY, SOCIAL RESPONSIBILITY IS THE SELECTION OF CORPORATE GOALS AND THE EVALUATION OF OUTCOMES NOT SOLELY BY THE CRITERIA OF PROFITABILITY AND ORGANIZATIONAL WELL BEING BUT BY ETHICAL STANDARDS OR JUDGEMENTS OF SOCIAL DESIRABILITY. THE EXERCISE OF SOCIAL RESPONSIBILITY, IN THIS VIEW, MUST BE CONSISTENT WITH THE CORPORATE OBJECTIVE OF EARNING A SATISFACTORY LEVEL OF PROFIT.
BUT IT ALSO IMPLIES A WILLINGNESS TO FOREGO A CERTAIN MEASURE OF PROFIT IN ORDER TO ACHIEVE NONECONOMIC ENDS. SOME OF THE TYPES OF CORPORATE ACTIVITIES THAT SHOW SOCIAL RESPONSIBILITY ARE:1. CHOOSING TO OPERATE ON AN ETHICAL LEVEL THAT IS HIGHER THAN WHAT THE LAW REQUIRES. 2. MAKING CONTRIBUTIONS TO CIVIC AND CHARITABLE ORGANIZATIONS.
3. PROVIDING BENEFITS FOR EMPLOYEES AND IMPROVING THE QUALITY OF LIFE IN THE WORKPLACE BEYOND ECONOMIC AND LEGAL REQUIREMENTS. 4. TAKING ADVANTAGE OF AN ECONOMIC OPPORTUNITY THAT IS JUDGED TO BE LESS PROFITABLE BUT MORE SOCIALLY DESIRABLE THAN SOME ALTERNATIVES. 5. USING CORPORATE RESOURCES TO OPERATE A PROGRAMME THAT ADDRESSES SOME MAJOR SOCIAL PROBLEM
CSR IS NOW EVEN A MARKETABLE ASSET. LONDON¶S FINANCIAL TIMES STOCK EXCHANGE (FTSE) HAS AN INDEX CALLED FTSE4GOOD. THIS INDEX LISTS COMPANIES THAT FOLLOW CSR GUIDELINES LAID DOWN BY THE FTSE4GOOD BOARD. THE BOARD CONSTANTLY EVOLVES THESE RULES AND COMPANIES ARE REQUIRED TO DEMONSTRATE COMPLIANCE TO RETAIN THEIR LISTING.
ARGUMENT AGAINST CSR
PERHAPS THE BEST KNOWN CRITIC OF CSR IS MILTON FRIEDMAN HIS MAIN ARGUMENT IS THAT CORPORATE EXECUTIVES, WHEN THEY ARE ACTING IN THEIR OFFICIAL CAPACITY AND NOT AS PRIVATE PERSONS, ARE AGENTS OF SHAREHOLDERS OF THE COMPANY. AS SUCH, EXECUTIVES OF A COMPANY HAVE AN OBLIGATION TO MAKE DECISIONS IN THE INTERESTS OF THE SHAREHOLDERS, WHO ARE ULTIMATELY THEIR EMPLOYERS.
CORPORATES¶ CORE BUSINESS AND SOCIAL RESPONSIBILITY TODAY, MANY BUSINESSES HAVE COME TO UNDERSTAND THAT BEING A GOOD CORPORATE CITIZEN CAN ALSO MEAN SIGNIFICANT BENEFITS. THERE ARE SEVERAL EXAMPLES OF HOW CORPORATE SOCIAL RESPONSIBILITY CAN ACTUALLY BECOME PART OF THEIR CORE BUSINESS.
THE ITC GROUP¶S e-CHOUPAL PROJECT GIVES ACCESS TO IT KIOSKS TO FOUR MILLION FARMERS ACROSS NINE STATES IN INDIA. THESE KIOSKS PROVIDE INFORMATION ABOUT THE WEATHER, CROP PRICES AND FERTILISERS. THIS HAS INCREASED FARMER INCOMES BY 30-40 PER CENT. AS A BUSINESS, THIS GIVES ITC ACCESS TO RELIABLE SOURCES OF FARM PRODUCE.
ITC¶s SOCIAL AND FARM FORESTRY PROJECT ALSO PROVIDES A COMPREHENSIVE PACKAGE OF SUPPORT TO TRIBAL AREAS. IT INCLUDES LOANS, PLANTING OF SAPLINGS AND PLANTATION MAINTENANCE. THE TRIBALS GROW THE SAPLINGS, WHICH ARE LATER USED BY ITC FOR WOOD PULP. THE PROJECT HAS GENERATED 28 MILLION DAYS OF EMPLOYMENT.
ITC HAS ALSO EARNED CARBON CREDITS FROM THE NEARLY 75,000 ACRES OF GREEN COVER. ITC IS PROBABLY INDIA¶S LARGEST COMPANY TO HAVE A POSITIVE CARBON AND WATER BALANCE. THEIR PROJECTS COVER THE TWIN GOALS OF CREATING SOCIAL DEVELOPMENT AND SHAREHOLDER VALUE. ANOTHER COMPANY KNOWN FOR ITS PROENVIRONMENT OPERATIONS IS THE ORCHID HOTEL CHAIN.
EVEN THE BRICKS USED IN THE BUILDINGS ARE RECYCLED FROM WASTE-MATERIALS SUCH AS FLY ASH. EACH ROOM HAS AN µECO BUTTON¶, WHICH THE GUESTS CAN USE TO REDUCE THE AIRCONDITIONING LOAD. THE GROUP HAS ALSO INVESTED IN ELECTRICITY, WATER, LIGHTING AND SOLID WASTE MANAGEMENT. THERE ARE COSTS INVOLVED IN PUTTING THESE SYSTEMS IN PLACE.
BUT IT HELPS THEM SAVE MONEY IN THE LONG RUN. HINDUSTAN UNILEVER (HUL) BELIEVES THAT THERE BRAND SHOULD DO THE TALKING. THEY RUN EXERCISES THAT HELP A BRAND IDENTITY A SOCIAL ISSUE OR µCAUSE¶ THAT FITS NATURALLY WITH IT. IN RESPONSE TO A GROWING NUMBER OF IODINEDEFICIENCY DISEASES, HUL DEVELOPED A TECHNOLOGY THAT PRESERVED THE IODINE CONTENT IN SALT EVEN AFTER COOKING.
THUS, HUL¶S ANNAPURNA SALT IS THE FIRST BRAND TO BE ENDORSED BY THE INTERNATIONAL COUNCIL FOR THE CONTROL OF IODINE DEFICIENCY DISORDERS. RURAL HANDICRAFT RETAILER, FABINDIA, IS ANOTHER MODEL OF SUSTAINABLE BUSINESS. THE COMPANY SOURCES ALL ITS PRODUCTS DIRECTLY FROM VILLAGE ARTISANS. FABINDIA WANTS TO CREATE 100.000 SKILLED JOBS IN RURAL INDIA.
BECAUSE FABINDIA¶S PRODUCTS ARE ALL HANDMADE, PRODUCTION CANNOT BE RAMPED UP IF DEMAND SUDDENLY RISES. TO REDUCE SUPPLY GAPS, THE COMPANY NOW PLANS TO MOVE FROM A SINGLE, CENTRAL WARHOUSE MODEL TO REGIONAL WAREHOUSES, WHICH WILL BE PARTLY OWNED BY THE ARTISANS WHO SUPPLY TO THEM. AS INDIVIDUAL COMPANIES SHOW SUCCESSES FROM REINVENTING THEIR BUSINESS MODELS FOR GOODNESS, WHOLE INDUSTRIES ARE NOW GETTING IN ON THE ACT.
CASE STUDIES
IN INDIA, THE ROLE OF CSR HAS BEEN GAINING MOMENTUM FOR A DECADE NOW. THE REALISATION THAT THE PARTICIPATION OF THE PRIVATE SECTOR CAN FOSTER THE PUBLICPRIVATE PARTNERSHIP IS VITAL IN TERMS OF SHARING RESOURCES, BRINGING IN EXPERTISE AND APPROPRIATE TECHNOLOGIES. THIS CAN ENHANCE VISIBILITY OF CAMPAIGNS, AND BRINGING ABOUT CIVIL SOCIETY RESPONSE
INFOSYS: THE INFOSYS FOUNDATION PROVIDED CONSIDERABLE FINANCIAL ASSISTANCE TO WAR WIDOWS. ALSO INVOLVED WITH CONSTRUCTION OF A SUPER SPECIALITY HOSPITAL IN ANDHRA PRADESH AND RECONSTRUCTING A SCHOOL IN KARNATAKA. WIPRO: THE AZIM PREMJI FOUNDATION RUN BY THE WIPRO CHAIRMAN IS WORKING ON PROVIDING ELEMENTARY SCHOOLING TO THOUSANDS OF UNDERPRIVILEGED CHILDREN
STEEL AUTHORITY OF INDIA: (SAIL) HAS INITIATED SAIL AIDS CONTROL PROGRAMME IN ASSOCIATION WITH THE NATIONAL AIDS CONTROL ORGANIZATION. SAIL¶S MAJOR INITIATIVES INCLUDE SCHOOL AIDS EDUCATION PROGRAMME, SAFE BLOOD AND BLOOD PRODUCTS, FAMILY HEALTH AWARENESS CAMPAIGN, AND VOLUNTARY COUNSELLING AND TESTING CENTRES.
APOLLO TYRES: IN ASSOCIATION WITH 36 NGOS, THE TYRE COMPANY LAUNCHED APOLLO TYRE HEALTH CARE CENTRE IN OCTOBER 2000 TO PROVIDE GENERAL AND SEXUAL HEALTH SERVICES FOR TRUCKERS AND TRANSPORT COMMUNITIES AT LARGE. THE INCEPTION OF THE CLINIC WAS A LOGICAL CONCLUSION OF THE COMPANY¶S WELFARE POLICY.
RURAL INDIA-DEVELOPMENTAL MARKETING
RURAL INDIA IS NOT JUST ABOUT SELLING SOAPS OR COLAS IN FLEXIBLE SIZES AT LOWER PRICES. IT IS ABOUT CREATING A MARKET FROM SCRATCH BY FIRST DEVELOPING IT, SOLVING ITS BASIC PROBLEMS, FIGURING OUT WHAT IT NEEDS AND THEN DESIGNING A PRODUCT OR SERVICE BUILT AROUND THAT ONE NEED THAT A COMPANY COULD, PROBABLY. SERVICE. THIS IS WHAT DEVELOPMENTAL MARKETING IS.
DCM SHRIRAM CONSOLIDATED (DSCL)
DSCL MADE THE JUMP IN 2003. AFTER ABOUT 40 YEARS OF SELLING UREA AND OTHER AGRI-PRODUCTS, IT REALISED THAT IT NEEDED TO BETTER UTILISE ITS KNOWLEDGE OF RURAL MARKETS. THE RESULT WAS HARYALI KISAN BAZAR. A 54 STRONG CHAIN OF RURAL SUPERMARKET THAT OFFER EVERYTHING ONE MAY NEED ON A FARM, AND MORE.
IN 1997, MORE THAN THREE DECADES AFTER IT ENTERED THE RURAL MARKETS, DSCL STARTED SETTING UP THE SHRIRAM KRISHI UP VIKAS CENTRES. THE IDEA WAS TO DO SOME VALUE-ADDS TO ITS PRIMARY BUSINESS OF SELLING UREA, FERTILISERS AND SUGAR MANUFACTURING-ALL DEALING WITH FARMERS. THE CENTRES OFFER THE SERVICES OF AGRONOMISTS TO LOCAL FARMERS ACROSS 100 VILLAGES IN INDIA.
THESE CENTRES ARE HOOKED TO A REGIONAL CENTRE IN ALWAR(RAJASTHAN). WHICH, IN TURN, CAN PLUG INTO DELHI AND SEVERAL RURAL RESEARCH INSTITUTES. ACCORDING TO THE COMPANY, THE AVERAGE NUMBER OF QUERIES THE CENTRE GETS COULD RUN INTO THOUSANDS. FOR INSTANCE, IN PUNJAB, FARMERS WERE NOT USING POTASH AS A FERTILISER BECAUSE OF A THREE-YEAR-OLD ADVISORY THAT STATED THAT THERE WAS ENOUGH POTASH IN THE SOIL.
TESTS SHOWED THAT THIS WAS NOT TRUE ANY LONGER, AND, THEREFORE, PRODUCTIVITY WAS DROPPING. CLEARLY, HERE WAS AN OPPORTUNITY TO CONNECT ITS AGRO-PRODUCTS AND ADVICE, ALONGWITH OTHER THINGS. THAT IS HOW THE FIRST HARYALI KISAN BAZAR WAS BORN IN JULY 2003. THE IDEA WAS TO CREATE A RETAIL AMBIENCE THAT FARMERS WERE COMFORTABLE IN, WHERE THEY WERE NOT CHEATED AND WERE TREATED WITH DIGNITY AND TRUST.
THAT MEANT STOCKING ALL BRANDS OF UREA AND FERTILISER (BESIDES ITS OWN) AND TYING UP WITH FUEL COMPANIES SUCH AS BPCL. AS CONSUMERS STARTED DEMANDING MORE, THE WHOLE PRODUCT RANGE KEPT EXPANDING TO SEVERAL NON-AGRI PRODUCTS. THESE COULD BE ANYTHING FROM APPAREL TO SCHOOL BAGS, TATA-SKY¶s DTH SERVICE OR INSURANCE (ICICI-LOMBARD FOR WEATHER AND ICICI-PRUDENTIAL FOR LIFE INSURANCE). SOON IT WILL BE ROLLING OUT THE NATIONAL COMMODITIES EXCHANGE SERVICES.
HINDUSTAN PETROLEUM LTD.(HPL) HPL, IN ASSOCIATION WITH MARKETING RESEARCH AGENCY MART, HAS SET UP 589 COMMON COMMUNITY KITCHENS (RASOIGHARS) IN 30 VILLAGES ACROSS INDIA THE PLAN IS TO TAKE THAT TO 720 BY THE END OF THE YEAR. THE IDEA: TO BRING CLEAN FUEL AND SAVE TIME IN GATHERING FIREWOOD.
THE RESULT: IN VILLAGES SUCH AS AGWAN, IN MAHARASHTRA, THE SELF-HELP GROUPS HAVE HELPED COLLECT FUNDS TO GET CONNECTIONS FOR THE ENTIRE VILLAGE. THE SIDE-EFFECT: SINCE THEY HAVE THE TIME, GIRLS GO TO SCHOOL IN MANY OF THESE VILLAGES.
THE CHEVRON WAY
THE CORPORATE RESPONSIBILITY EFFORTS ARE GROUNDED IN THE CHEVRON WAY, WHICH OUTLINES THEIR COMMITMENT TO ³CONDUCT BUSINESS IN A SOCIALLY RESPONSIBLE AND ETHICAL MANNER«SUPPORT UNIVERSAL HUMAN RIGHTS«PROTECT THE ENVIRONMENT, BENEFIT THE COMMUNITIES WHERE WE WORK«LEARN FROM AND RESPECT CULTURES IN WHICH WE WORK.´
CHEVRON DEFINES CORPORATE RESPONSIBILITY AS:
CONSISTENTLY APPLYING OUR CORE VALUES, SET OUT IN THE CHEVRON WAY MAXIMIZING THE POSITIVE IMPACT OF OUR OPERATIONS ON CURRENT AND FUTURE GENERATIONS, INTEGRATING SOCIAL, ENVIRONMENTAL AND ECONOMIC CONSIDERATIONS INTO OUR CORE PRACTICES AND DECISION MAKING
ENGAGING WITH AND BALANCING THE NEEDS OF OUR KEY STAKEHOLDERS
1. 2. 3. 4. 5.
CHEVRON HAS DEVELOPED SOUND POLICIES, PRACTICES OR PROGRAMS THAT ADDRESS EACH OF THE FOLLOWING SEVEN ELEMENTS:BUSINESS ETHICS AND TRANSPARENCY WORKPLACE PRACTICES AND EMPLOYEE RELATIONS ENVIRONMENT, HEALTH AND SAFETY HUMAN RIGHTS COMMUNITY ENGAGEMENT AND DEVELOPMENT
6. 7.
INTEGRATION OF CORPORATE RESPONSIBILITY INTO THEIR SUPPLY CHAIN STAKEHOLDER CONSULTATION ENVIRONMENTAL MANAGEMENT: THE THREE STRATEGIC PRIORITIES WHERE THEY HAVE MADE MEASURABLE PROGRESS ARE: DEFININGWORLD-CLASS STANDARDS, MEASURING AND COMMUNICATING PERFORMANCE AND DEMONSTRATING CONTINUAL PERFORMANCE IMPROVEMENT.
1.
CLIMATE CHANGE, ENERGY EFFICIENCY AND RENEWABLES: THE USE OF FOSSIL FUELS TO MEET THE WORLD¶S ENERGY NEEDS HAS CONTRIBUTED TO AN INCREASE IN GREENHOUSE GASES (CHGs) ± MAINLY CARBON DIOXIDE AND METHANE. CHEVRON¶S CLIMATE CHANGE FOURFOLD ACTION PLAN WHICH IS NOW IN THE FOURTH YEAR OF IMPLEMENTATION IS AS FOLLOWS:REDUCING EMISSIONS OF CHGs AND INCREASING ENERGY EFFICIENCY
2. 3.
4.
INVESTING IN RESEARCH, DEVELOPMENT AND IMPROVED TECHNOLOGY PURSUING BUSINESS OPPORTUNITIES IN PROMISING, INNOVATIVE ENERGY TECHNOLOGIES SUPPORTING FLEXIBLE AND ECONOMICALLY SOUND POLICIES AND MECHANISMS THAT PROTECT THE ENVIRONMENT. COMMUNITY ENGAGEMENT: COMMITTED TO CONTRIBUTING TO THE SOCIAL AND ECONOMIC DEVELOPMENT OF THE COMMUNITIES IN WHICH THEY OPERATE.
1. 2. 3.
MOST OF THEIR COMMUNITY INITIATIVES AND INVESTMENTS ARE FOCUSED ON BUILDING HUMAN AND INSTITUTIONAL CAPACITY IN WAYS THAT HELP STIMULATE ECONOMIC GROWTH AND ENABLE COMMUNITIES TO PROSPER. CHEVRON HAS IDENTIFIED THREE AREAS THAT THEY CONSIDER CRITICAL TO ECONOMIC DEVELOPMENT: BASIC HUMAN NEEDS EDUCATION AND CAREER TRAINING SMALL AND MEDIUM-SIZE BUSINESS DEVELOPMENT, INCLUDING ACCESS TO CREDIT
ITC LTD.
CONTRIBUTION TO SOCIAL AND ECOLOGICAL CAPITAL THE UNIQUENESS OF ITCs CONTRIBUTION TO ENLARGING SOCIAL AND ECOLOGICAL CAPITAL LIES IN BEING ABLE TO ENMESH SUCH CONTRIBUTION INTO THE PROCESS OF GENERATING SHAREHOLDER VALUE THROUGH CREATIVE BUSINESS MODELS ± THE INNOVATIVE ITC-e-CHOUPAL BUSINESS MODEL AND THE ITC FARM AND SOCIAL FORESTRY INITIATIVES.
EMPOWERING THE SMALL FARMER
THE ITC e-CHOUPAL INITIATIVE IS A POWERFUL ILLUSTRATION OF LINKING BUSINESS PURPOSE WITH A LARGER SOCIETAL PURPOSE. IT LEVERAGES THE POWER OF THE INTERNET TO EMPOWER THE SMALL AND MARGINAL FARMER WITH A HOST OF SERVICES RELATED TO KNOWHOW, BEST PRACTICES, TIMELY AND RELEVANT WEATHER INFORMATION, TRANSPARENT DISCOVERY OF PRICES AND MUCH MORE.
THIS DIGITAL INFRASTRUCTURE CAN ALSO BE USED FOR CHANELLISING SERVICES RELATED TO CREDIT, INSURANCE, HEALTH, EDUCATION AND ENTERTAINMENT. IT CAN ALSO SERVE AS A STRONG FOUNDATION FOR LINKING SMALL AND MARGINAL FARMERS TO FUTURES MARKETS TO FACILITATE FARMER RISK MANAGEMENT. THE ACCESS TO e-CHOUPALS, WITHIN WALKING DISTANCE FROM THE FARMGATE, IS SUPPLEMENTED THROUGH PHYSICAL INFRASTRUCTURE-THE ITC CHOUPAL SAAGAR.
THIS FUNCTIONS AS A HUB FOR A CLUSTER OF VILLAGES WITHIN TRACTORABLE DISTANCE. THESE MADE ±TO- DESIGN HUBS ALSO SERVE AS WAREHOUSES, AND AS RURAL SUPERMARKETS FOR A VARIETY OF GOODS. IN EFFECT, THE e-CHOUPAL INFRASTRUCTURE IS POTENTIALLY AN EFFICIENT DELIVERY CHANNEL FOR RURAL DEVELOPMENT AND AN INSTRUMENT FOR CONVERTING VILLAGE POPULATIONS INTO VIBRANT ECONOMIC ORGANIZATIONS.
AGRO FORESTRY LED RURAL RENAISSANCE
THE LABOUR INTENSITY OF AGRO FORESTRY AND THE AVAILABILITY OF THE SECOND HIGHEST ARABLE LAND MASS IN THE WORLD REPRESENT TWO STRATEGIC ASSETS THAT CAN BE LEVERAGED TO TRANSFORM THE COMPETITIVENESS OF THE TREE-TO-TEXTBOOK VALUE CHAIN. ITC¶S PRESENCE IN THIS VALUE CHAIN PROVIDES THE BASIS FOR A SIGNIFICANTLY ENLARGED CONTRIBUTION TOWARDS RAISING LIVING STANDARDS IN RURAL HINTERLANDS.
SO FAR, MORE THAN 149 MILLION SAPLINGS HAVE BEEN PLANTED IN NEARLY 41,000 HECTARES UNDER ITC¶S FARM AND SOCIAL FORESTRY PROGRAMMES PROVIDING 18 MILLION PERSON DAYS OF EMPLOYMENT. THE COMPANY¶S AGRO FORESTRY INITIATIVES ALSO EXTEND TO CONSERVATION OF NATURAL CAPITAL AS WELL, INCREASING GREEN COVER, IN SITU MOISTURE CONSERVATION, GROUNDWATER RECHARGE, SIGNIFICANT REDUCTION IN SOIL EROSION AND ENRICHMENT OF DEPLETED SOILS ARE SOME OF THE DIRECT ENVIRONMENTAL BENEFITS.
OTHER SOCIAL BENEFITS
OTHER SOCIAL INITIATIVES IN THE VICINITY OF ITS OPERATING LOCATIONS ARE CENTERED AROUND THREE MAIN AREAS OF INTERVENTION UNDER µMISSION SUNEHRA KAL¶: (A) NATURAL RESOURCE MANAGEMENT, WHICH INCLUDES WASTELAND, WATERSHED AND AGRICULTURE DEVELOPMENT; (B) SUSTAINABLE LIVELIHOODS, COMPRISING GENETIC IMPROVEMENT IN LIVESTOCK AND WOMEN¶S ECONOMIC EMPOWERMENT; AND (C)COMMUNITY DEVELOPMENT, WITH FOCUS ON PRIMARY EDUCATION AND HEALTH AND SANITATION.
