Source: http://www.propoor.org/blog.php?sid=28964
A N N O U N C I N G
Karmayog Corporate Social Responsibility Ratings
of India’s 500 largest Companies
www.karmayog.org/csr
“Every company harms the environment and people!”
Corporate Social Responsibility is thus just about two aspects:
1) The steps taken by a company to neutralise, minimise or offset the harmful effects caused by its processes and product-usage.
2) The further steps a company takes using its resources, core competence, skills, location and funds for the benefit of people and the environment.
This is the basic premise for Karmayog undertaking a rating of the Corporate Social Responsibility activities of India’s 500 largest companies (by sales).
This is the first time that such an exercise has been done in any country.
The results of the Karmayog CSR Rating are extremely disappointing.
They are as follows:
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Karmayog CSR Rating – No. of Companies – % of Companies
0 – 229 * – 46 %
1 – 91 – 18 %
2 – 139 – 28 %
3 – 37 – 7 %
4 – 4 **- 1 %
5 (highest) – 0 – 0 %
* Companies not doing CSR as per information from their websites and annual reports
** The 4 companies with a 4 out of 5 rating are HDFC, Infosys Technologies, Tata Steel, and Titan Industries
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Observations from the Karmayog CSR Rating of India’s 500 largest companies:
1. Most companies are not doing any CSR
2. Many companies are only making token gestures towards CSR in tangential ways such as donations to charitable trusts or NGOs, sponsorship of events, etc.
3. Most companies believe that charity and philanthropy equals to CSR; very few companies are using their core competence to benefit the community.
4. Most companies use CSR as a marketing tool to further spread the word about their business. For instance, donation of a token amount to some cause on purchase of a particular product. The fact that companies are hiring
advertising agencies for their CSR further highlights this.
5. Only 5 Indian companies (from this study) publish a Corporate Sustainability Report to measure and assess the impact of their business on the environment
6. Very few companies openly state the processes followed by them, the damage caused by these processes, and the steps taken to minimise this damage.
7. Very few companies state how much they spend on CSR. There is no mention of the amount spent in any of their balance sheets or annual reports. Most companies just list and describe their CSR activities and seem to be
spending minimal amounts on CSR.
8. Very few companies are engaged in CSR activities in the local communities where they are based.
9. Very few companies have a clearly defined CSR philosophy. Most implement their CSR in an ad-hoc manner, unconnected with their business process.
10. Most companies spread their CSR funds thinly across many activities, thus somewhere losing the purpose of undertaking that activity.
11. Most companies appear reluctant to themselves fulfil their CSR unless it is mandatory by law.
The full report is available here:
https://www.karmayog.org/redirect/strred.asp?docId=11691
A sector-wise analysis is also available here:
www.karmayog.org/sectortablesofcsr/
Enlightened businesses worldwide, small and large, have begun to realise that responsible practices enhance profitability & ensure long-term survival. For those that disrespect the environment or living beings, we, as
responsible citizens, need to individually and collectively, reward or penalise them through our voices and our wallets.
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