Few days ago I was watching an informative channel, wherein they were covering the story of Netherland’s famous brand “Heineken”. One of the problems that Heineken faced was the heavy traffic of Amsterdam. Their trucks were so large that they could hardly fit in the traffic of the city and occupied most of space on the road. So to deliver faster and to reduce the traffic and the pollution, they opened their own port and instead of sending products by roads they shipped it through water. In their own words they reduced the traffic by 95%! Well it was a small but an intelligent step. They not only solved their own problem but also did their duty towards the society better known as “Social Responsibility of Business” or “Corporate Social Responsibility (CSR)”
The business has certain duties towards the society which it must fulfil. In certain countries, CSR has been mandatory on the part of the company. Such as in India from April 2015, under the Indian Companies Act, all companies with at least Rs. 5 crore net profits or Rs 1,000-crore turnover will have to spend 2% of their annual net profit on CSR activities. A 100 years old Indian brand of TATA’s are a good example of CSR. They have built schools, hospitals, charitable trusts throughout the country. One of their biggest CSR is the Tata Memorial Hospital (Mumbai), for the treatment and research in Cancer and is recognised as one of the leading cancer centres. In 2013-2014, Tata group spent Rs 1000 crore on CSR, which is the highest CSR spend by an Indian conglomerate. Another example is the Coca-Cola Company who recently started a program to empower young women entrepreneurs.
It is often believed that when CSR is done it avoids unnecessary intervention of the government in the business. It is a duty that every business should perform and basically a process through which companies create a positive impact on the society.
Why CSR is important?
According to Nielsen’s 2014 Global Survey on Corporate Social Responsibility around 55% of global consumers across countries is willing to pay more for products and services from companies that are committed to positive social and environmental impact. The Importance of Corporate Social Responsibilities are:
- Corporate Social Responsibility improves brand name of a company.
- Attract talents.
- Makes employees happier.
- It is often believed that the government intervention is less, if the businesses are involved in CSR.
- Employees demand their companies to be socially responsible
- Enhances employee morale and helps in employee retention.
Some photos about Corporate Social Responsibility :
by Rashi Singh