“Two Percent Is The Cheapest Way To Wash Your Sins”

Questioning the social responsibility of companies beyond mere spending of funds, a report by Corporate Responsibility Watch (CRW) analysed different factors of responsibility. The report titled ‘CSR in India, 2016’ tried to explore responsible practices in core business areas examining factors like diversity in workforce, anti-sexual harassment policies, consumer issues and opportunities for people with disabilities among others.

The report compiled by CRW, a voluntary network of 13 non-governmental organisations was released by Justice Rajinder Sachar, retired chief justice of Delhi High Court in New Delhi. The report aims to bring about an environment of accountability in core business among all companies and not just 2% Corporate Social Responsibility (CSR).

Tom Thomas, Convener, CRW and CEO of Praxis said during the release event, “Two percent is the cheapest way to wash your sins. Even most religions have a higher percentage… Irrespective of the nexus that exists between the government, corporate firms and the media, we hold the firm belief that it is in the best interest of the corporate companies themselves to abandon the idea of chanda to wash or whitewash sins and engage in collaborative commons between business and community to reduce sins and generate distributive profits from virtue.”

The study analysed top 100 companies listed on BSE. Of the many aspects, one factor under consideration was women employment in these firms. Figures clearly showed the number of women employees to be very little as compared to their male counterparts.

Distribution of the top-100 companies in 2014-15, as per the percentage of women employees

“It is interesting how the corporates have also struggled to get women on their Boards, as was made mandatory by the 2013 Act. The initial deadline was 1 October 2014, but it was extended to 1 April 2015. After making it mandatory in 2013, two deadlines and a threat of fines later, there were still 247 out of the 1,451 NSE-listed companies that did not comply with the law on April 1, 2015,” the report stated mentioning the miserable details of workspace in India.

“In fact, over 300 directorship positions, or a third of what women should occupy, went to women only in March 2015. It is also pertinent to note that a number of companies actually appointed the female relatives of existing Board members to the Board. This indicates a failure to identify female talent; or rather an inability to retain them in the workforce and plain reluctance to promote them,” the report further added.

‘Inclusive growth’ is on the development agenda of India. Equality of opportunities for every citizen is often spoken about but the reality varies. Persons with disabilities (PwD) in India are rarely entrusted with professional responsibilities. Data found as an outcome of the study is an evidence to our neglect towards PwDs.

According to the report, 11 of the top 100 companies have reported that they do not have a single employee with any disability and 48 companies have less than 0.5% employees with disability. While PSUs have 3% reservation for PwDs, they have been unable to fill this quota.

Javed Abidi, National Centre for Promotion of Employment for Disabled People, commented on the status of CSR from the lens of disability. He stated that when CSR was being framed, the issue of disability was not taken into account. Only four to five companies out of 100 work on the issue of disability. People with disability accounted for only 0.006% of the total workforce.

“Disability is more than charity. But whatever little CSR happens in the name of disability, it’s all charity. Distributing aids will not solve the problem in the long run,” commented Abidi.

The report studied several factors like companies’ treatment towards employees and labourers, consumers, reservations as an affirmative agenda and implementation of CSR mandate among others.

Based on the implementation of CSR mandate in the initial years, the report remarked, “With lack of a clear monitoring mechanism what is counted as CSR is varied and we have seen examples with companies counting either out of the mandate activities or core business costs as CSR.

The study found only 17 of the top 100 have carried out needs assessment for designing CSR projects. Even more, only one company involved the community in designing its CSR projects. Furthermore, only 22 seemed to have any provision for an independent assessment of projects by an external entity.

“These findings accentuate the need for CSR to be closer to the community, not only in final delivery but also in the process of deciding what project to carry out as well as in deciding the manner it has to be carried out in for maximum impact,” read the report.

The amendment of Companies Act 2013 mandating firms of a certain threshold spending 2% of their funds for social activities had been welcomed by many. These factors however show that a lot is missing and needs improvement in the landscape of CSR in India. Corporate India shouldn’t treat CSR as an easy escape from their business responsibilities. Spending 2% funds wouldn’t make the desired impact till the time, all business actions are conscientious.

Justice Sachar quoted from his judgment about corporate responsibility in 1978, “In the environment of modern economic development, corporate sector no longer functions in isolation. Companies must behave and function as a responsible member of society. They cannot shun moral value.”

Thank you for reading the story until the very end. We appreciate the time you have given us. In addition, your thoughts and inputs will genuinely make a difference to us. Please do drop in a line and help us do better.

Regards,
The CSR Journal Team