CSR IS FUNDAMENTALLY AN

ETHICAL CONCEPT
A report submitted for internal assessment of
Company Law

Under the guidance of

Prof. S N Ghosh

PREPARED BY
Roll No. Name Section Group No. Signature
03 Mr. Akshit Gogia
08 Mr. Anuj Kumar
[B Com]
FF –1 01
10 Ms. Avni Malhotra
14 Mr. Binod Kumar
20 Mr. Kunal Thakur
[CS]

IIPM
IIPM TOWER, SATBARI,
CHANDAN HAULA, CHATTARPUR-BHATIMINES
ROAD
NEW DELHI
 CSR IS FUNDAMENTALLY AN ETHICAL CONCEPT

ACKNOWLEDGEMENT
We thank Mr. in particular for assigning us this topic and encouraging us to write in the
first place. We owe much to Mr. for his helpful comments.

We are indebted to all those who have been helpful throughout the process of writing this
Report– Mr. , Ms. and Mr. but as the cliché goes, we are solely responsible for any
remaining errors of fact or judgment.

Signature of group members

(Mr. Akshit) (Mr. Anuj) (Ms. Avni) (Mr. Binod) (Mr. Kunal)

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 CSR IS FUNDAMENTALLY AN ETHICAL CONCEPT

Contents
Acknowledgement
1. Abstract 4
2. Introduction 5
3. Triple Bottom Line Reporting 6
4. Making the Business Case for CSR 7
5. Conclusion 9

Signature of group members

(Mr. Akshit) (Mr. Anuj) (Ms. Avni) (Mr. Binod) (Mr. Kunal)

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 CSR IS FUNDAMENTALLY AN ETHICAL CONCEPT

ABSTRACT

CSR IS FUNDAMENTALLY AN ETHICAL CONCEPT

Corporate social responsibility (CSR) is a concept that suggests that commercial

corporations have a duty of care to all of their stakeholders in all aspects of their business
operations. CSR is closely linked with the principles of Sustainable Development which
argue that enterprises should be obliged to make decisions based not only on financial /
economic factors (e.g. Profits, Return on Investment, dividend payments etc.) but also on the
social, environmental and other consequences of their activities. In a global economy,
increasingly organizations have a responsibility to facilitate, demonstrate and promote
corporate social responsibility (CSR). Long-term sustainability demands that organizations
rethink their business goals and objectives from solely focusing on making a profit to
corporate citizenship. Today, the impact of CSR is beginning to be seen in communities
throughout the world--from human rights and labor practices to health care and the
environment. At home and abroad, HR plays a critical role--that of leading and educating
their firms regarding the importance of CSR while at the same time strategically
implementing sound HR management practices that support the companies business and CSR
goals.

Signature of group members

(Mr. Akshit) (Mr. Anuj) (Ms. Avni) (Mr. Binod) (Mr. Kunal)

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 CSR IS FUNDAMENTALLY AN ETHICAL CONCEPT

CSR IS FUNDAMENTALLY AN ETHICAL CONCEPT

INTRODUCTION

CSR could be defined as:

A concept whereby companies integrate social and environmental concerns in their

business operations and in their interaction with their stakeholders on a voluntary basis.
Amongst other things, this definition helps to emphasize that:

• CSR covers social and environmental issues, in spite of the English

term corporate social responsibility;

• CSR is not or should not be separate from business strategy and

operations: it is about integrating social and environmental concerns into
business strategy and operations;

• CSR is a voluntary concept;

An important aspect of CSR is how enterprises interact with their internal and external
stakeholders (employees, customers, neighbors, non-governmental organizations, public
authorities, etc.).

Signature of group members

(Mr. Akshit) (Mr. Anuj) (Ms. Avni) (Mr. Binod) (Mr. Kunal)

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 CSR IS FUNDAMENTALLY AN ETHICAL CONCEPT

Triple Bottom Line Reporting

Corporate Social Responsibility varies from corporate to corporate. CSR is all about
addressing economic, environmental of sustainable development. Economic sustainability is
related to economic profitability, competitiveness and creation of job market. Environment
sustainability is related to the efficient use, management and protection of natural resources.
Though CSR is not a new concept, it has become very important in taking any business
decision today. A business practicing CSR well can achieve Sustainable development, which
means effectively managing the environmental, social and economic outcomes for the benefit
of stakeholders. In any business, authority is exercised by the directors who have various
duties and responsibilities. CSR, in other terms means the responsibilities of the directors
towards the stakeholders through Triple Bottom Line Reporting (TBLR). The terms TBLR
basically refers to a framework which measures corporate performance. It attempts to bring
three interrelated spheres of activity -social, economic and environmental - together in order
to bring forth a balanced view of corporate performance and sustainable development.
Another feature of the report is that TBL can be communicated to all stakeholders. This is
known ac TBLR system. Some of the benefits of the TBL approach are getting broadened
platform on which the performance of a company is evaluated, as it has laid down various
parameters of measuring environmental and employment issues, diversify practices and
occupational safety and health. Keeping these changes in mind, CSR, Sustainable
Development and TBL approach have become very concepts.

Signature of group members

(Mr. Akshit) (Mr. Anuj) (Ms. Avni) (Mr. Binod) (Mr. Kunal)

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 CSR IS FUNDAMENTALLY AN ETHICAL CONCEPT

Making the Business Case for CSR

In recent years, intangible assets--company values, human and intellectual capital, reputation
and brand equity--have become increasingly important to organizations. Companies that
exhibit good corporate citizenship are likely to gain a competitive edge. Below are just a few
examples of today’s CSR success factors that are fast becoming the primary measures of
organizations credibility. The benefits of CSR to businesses vary depending on the nature of
the enterprise, and are difficult to quantify, though there is a large body of literature exhorting
business to adopt measures beyond financial ones. CSR may be based within the human
resources, business development or PR departments of a company, Progressive companies do
not have a CSR department or function at all -- the concept is so ingrained in the company
itself that employees implement the companies values directly.

The business case for CSR within a company is likely rest on one or more of these
arguments:

Development and Analysis

Today’s heightened interest in the role of businesses in society has been promoted by
increased sensitivity to, and awareness of environmental and ethical issues. Issues like
environmental damage, improper treatment of workers, and faulty production leading to
customers inconvenience or danger, are highlighted in the media. In some countries
government regulation regarding environmental and social issues has increased, and
standards and laws are also often set at a supranational level. Some investors and investment
fund managers have begun to take account of a corporation’s CSR policy in making
investment decisions (so called "ethical investing"). Some consumers have become
increasingly sensitive to the CSR performance of the companies from which they buy their
goods and services. These trends have contributed to the pressure on companies to operate in
an economically, socially and environmentally sustainable way.

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 CSR IS FUNDAMENTALLY AN ETHICAL CONCEPT

Signature of group members

(Mr. Akshit) (Mr. Anuj) (Ms. Avni) (Mr. Binod) (Mr. Kunal)

It is important to distinguish CSR from charitable donations and "good works". Corporations
have often, in the past, spent money on community projects, the endowment of scholarships,
and the establishment of foundations. They have also often encouraged their employees to
volunteer to take part in community work and thereby create goodwill in the community
which will directly enhance the reputation of the company and strengthen its brand. CSR
goes beyond charity and requires that a responsible company take into full account their
impact on all stakeholders and on the environment when making decisions. This requires
them to balance the needs of all stakeholders with their need to make a profit and reward their
shareholders adequately.

Human Resources

Corporate Social Responsibility can be an important aid to recruitment and retention,

particularly within the competitive graduate student market. Potential recruits are
increasingly likely to ask about a firms CSR policy during an interview and having a
comprehensive policy can give an advantage. CSR can also help to build a "feel good"
atmosphere among existing staff, particularly when they can become involved through
payroll giving, fund raising activities or community volunteering.

Risk Management

Managing risk is a central part of many corporate strategies. Reputations that take decades to
build up can be ruined in hours through incidents such as corruption scandals or
environmental accidents. These events can also draw unwanted attention from regulators,
courts, governments and media. Building a genuine culture of doing the right thing within a
corporation can offset these risks. Managing investor confidence is another factor supporting
the business case for CSR. Today, the financial community is examining organizations CSR
report cards and their risk profile. The rapid rise of socially responsible investment illustrates
that corporate citizenship is becoming a key measure that investors consider when aligning
ethical concerns with publicly held corporations.

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 CSR IS FUNDAMENTALLY AN ETHICAL CONCEPT

Signature of group members

(Mr. Akshit) (Mr. Anuj) (Ms. Avni) (Mr. Binod) (Mr. Kunal)

Conclusion

Some would argue that it is self-evidently “good” that businesses should seek to minimize
any negative social and environmental impact resulting from their economic activity. It can
also be beneficial for a company’s reputation to publicize any environmentally beneficial
business activities. Corporate executives and employees in turn have strong incentives to
internalize the corporation’s statutory obligations to maximize profits, sometimes to the
extent that they abdicate their individual moral and ethical obligations as human beings. So
the CSR movement may perhaps be understood as an attempt not so much to regulate the
activities of corporations per se, as to remind the people who constitute these corporations
that they nonetheless have other responsibilities beyond the corporate ones.

Signature of group members

(Mr. Akshit) (Mr. Anuj) (Ms. Avni) (Mr. Binod) (Mr. Kunal)

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 CSR IS FUNDAMENTALLY AN ETHICAL CONCEPT

References
1. www.sebi.gov.in
2. www.iosco.org
3. www.gscsbenchmarks.com
4. Handbook on statistics on the Indian securities market – 2004 (SEBI)

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