Festivity and benevolence has a deep rooted connection. During Diwali season when a lot being discussed about low business, I was wondering how it has affected the philanthropic spirits of the people. I know someone personally who used to donate new clothes for the children of an orphanage besides other assortments, could only manage to send 20 boxes of sweets this year. This is just one tiny example of the slowdown impact, I am sure experts are observing the trend on a much bigger scale. The question is- whether this downturn will impact the CSR budgets of the socially responsible? I have been reading some articles and following the views and arguments related to this discussion. While some thought leaders argue that companies would invest less now, others stand firmly that those companies who have a true and deep commitment towards CSR are the ones who have been able to integrate this into their core business functions. Such companies would not dither in fulfilling their community commitments in future also. CSR is not anymore an endearing add-on but it is a part of ingenious business strategy for most organizations.
Though cost effectiveness is the buzzword today, I lean towards the latter perspective: I think CSR - as long as it embraces employee welfare, corporate governance, business ethics, transparency, strong sustainable community initiatives that enhance the consumer base, create a balanced and inclusive development, among other key elements, will be sustainable.
I feel CSR is not something to be done when businesses have resources in excess; rather it is a day-to-day activity and a way of running a responsible business. When the business model is such that the economic value of CSR is as clear as it can be, one does not require smooth market situation and booming economy to follow the laid down strategy. So in that sense, during the economic downturn, CSR might possibly move away from the charity-driven community initiatives to actually sustainable and responsible business practices that hold the company in good stead be it in good times or bad.
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Doing something without expecting something in return can be defined as 'Service' or 'Seva' in Hindi. Perhaps, the same when done by the companies can be called as CSR. I agree with Rashmi that whether things are up or down, one must continue to do seva. One way to look at this is to define a proportion of your income that you would 'donate' for seva. This way, you are always doing something, let it be 3% or 5% of your income. Some traditions maintain that this be 10%. I know several people who follow this principle as a matter of routine or habit. The 'business strategy' here could simply be to make a difference to the world that is giving us so much, and make it a better place for the generations that are going to come in the future. Are you ready to sign up? And if your hesitation is whether your donations would really be used for real purpose, then let me know, there are some really authentic opportunities.
I may be taking this to a different plane Rashmi - and I know your post wasn't loaded in this direction, but here is my thought.
While companies think of CSR in such turbulent times as these, a more potent question to ask before - or alongside - is about the company's responsibility (corporate, social or otherwise), towards the employees, who also - in a set up like ours - do not have too much of a social security to fall back upon, and who have stood by you and have grown your business while the going was good. How would you treat them in a situation like this?
Just a thought.
Aadesh - by your logic of 3 to 5 to 10 percent of your income going into a social cause, how would you treat the situation when your revenues and profits are sliding. That supports Rashmi's argument of the slide in the overall CSR budgets - doesn't it?
But I agree - if you earmark a percentage anyway, you would still be true to committing yourself to the cause.
Ravi (Fursat Friday) has raised some interesting and important points. Here is more on this.
Employees are much more a part of a company then rest of the society. When we talk about CSR, we are talking about the latter, and must keep them separately. What this means is that a company must not stop doing CSR just because it has nothing left as everything was used for employee welfare!
However, this does not mean that a company does not take care of employees in the tough times like this. There are several ways in which a company can deal with it:
>> Rather than a work force reduction, a company can look at salary reduction of all employees to tide over the period of crisis.
>> Employees can voluntarily or involuntarily be on a limited leave without pay.
>> If a company despite doing the above has to reduce workforce because nothing short of this world work, they can help the employees who are let go by giving them extra compensation, counseling, helping them find jobs, offer that they would be the first ones to be hired back when the tide turns, etc.
The employees can really help by more willingness for some temporary salary cuts to tide over the tough times, rather than resisting it.
Lastly, linking your CSR budget to income seems like a good idea to me. When you can do more, you must. But when the situation is tight, you are still doing something :)
CSR is very simply summarized in the following words (doha) of Sant Kabir's
साईं इतना दीजिये, जामे कुटुंब समाये !
मैं भी भूखा ना रहूँ, साधू ना भूखा जाए !!
So even in turbulent times we should forgo our food to feed the "Sadhu" (the bottom of our social pyramid). And neither corporate nor individuals should shy away from that.
I agree that each one of us has a responsibility to help the society.
But i also have one question that by doing this are we not encouraging the habit of not working.
It is a comman nature that if you get something very easily then one will not work hard to earn that and will not value those things.
I have an example to share:
I used to donate clothes and other items to Jhuggi people near my area but the very next day when I passed that area again the kids were without the clothes and were in the same condition.
This insisted me to think again whether to help in future or not.
Only one small thought.
A Married Couple.
Husband, Wife and 2 little Children
Salary 20,000 Bucks.
Nuclear Setup.
To cover up the guilt ( of being Nuclear) Guy gives 5000 bucks to his parents.
And commits to Women of his Live
Dont worry I will never do something so that I have to cut down on our personal expenses to give money to my existing family.
Dilemma Here is
The guy is not wrong
The lady is not wrong
So how to decide what should be done and what should not be done
The CSR thing sounds like this to me
My conclusion
Donate to people who need it :-)
Sometimes this turns out good also Aadesh. My previous employer had to close down CSR funding due to downturn – Luckily few friends managed to fund the same along with IIM-B and keep it going! I took a sabattical and steered it ..and now ‘LifeDream’ is a big movement. http://www.lifedreamfoundation.org/
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