Everything You Ever Wanted To Know About Corporate Social Responsibility

As a business concept, corporate social responsibility is based on self-regulation. This practice helps a company stay socially responsible and accountable to the company, to its stakeholders and to the public. A company practices corporate social responsibility when they wish to be more conscious about the impact they have on every aspect of society, including social, environmental and economic impacts. In brief, the company makes sure that it is operating in a way that impacts the environment and society in a positive manner. This is done by participating in corporate social responsibility. 

Corporate social responsibility is done in many different ways, depending on the company involved or the industry it belongs to. Brands can boost their public images with the help of CSR policies. They can participate in volunteer work, philanthropic work and other such activities for the betterment of society. These activities not only benefit society but also help the company’s image. CSR programs can also help the employees of the company form stronger bonds with their corporate partners and improve employee morale to help the employers and employees be more connected to the world around them. 

For this, the first and the most important step for the company that practices CSR is to be accountable to their employees and to the stakeholders. Most often, companies take part in CSR programs only when they have grown to an extent where they are capable of giving something back to the community. This means that corporate social responsibility is implemented by large corporations most of the time. If a brand or organisation has more visibility, it becomes more important for the company to be seen as having a positive impact on society. By practising corporate social responsibility, a company can set a standard for other companies, their peers and for the industry in general. Let us take a closer look at corporate social responsibility in India, which is now a law in India. 

In 2014, India became the first country to make CSR mandatory by law. A few new rules in section 135 of India’s Companies Act make it a law for companies to spend 2% of their average profit in the previous three years on corporate social responsibility, provided they have a certain turnover and profitability.

About Corporate Social Responsibility in India

All of the laws related to corporate social responsibility in India make it clear that every CSR related activity must take place in project or program mode. The law has very strict guidelines in place about the kinds of activities that qualify for corporate social responsibility. Activities under a few categories are included in the corporate social responsibility criteria. Some of these categories include poverty alleviation, hunger, education, gender equality, health and many more. Businesses are allowed to invest their profits in these areas. During the pandemic, that is the COVID-19 outbreak, The Ministry of Corporate Affairs announced that any expenditure made by companies towards fighting the pandemic would be considered to be a part of corporate social responsibility activities. Funds that are spent on a host of COVID-19 related activities, like sanitation, healthcare, preventive medicine, disaster management and the promotion of healthcare, would be considered to be under corporate social responsibility. This amendment made corporate social responsibility a mandatory law for companies, while it was earlier optional. 

This is the process followed for corporate social responsibility

Corporate social responsibility analyses the responsibility and impact of any company towards the community. This assessment is done in the following aspects of a business. 

The corporate social responsibility laws in India make sure that every company complies with legal obligations, it also needs to be ensured that the development and growth of the marginalised communities in the country are respected. CSR activities in India should not only be sustainable but should also support the organisation’s development in a positive way. 

AISECT happens to be one of the leading providers of skill development training and has been selected as one of the NSDC training partners to implement this scheme in the country. So far, the scheme has been implemented in nine states in India, namely Haryana, Rajasthan, Madhya Pradesh, Jharkhand, Delhi, Chhattisgarh, Punjab, West Bengal and Odisha. It covers 289 schools in total. 

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