India’s Evolving Corporate Social Responsibility Landscape: A Closer Look
Tikam Shekhawat
Pune, 25th April 2024:
In the realm of corporate operations, the concept of Corporate Social Responsibility (CSR) stands as a beacon of ethical commitment to contribute positively to society. Emerging from the ethos of giving back, CSR extends beyond mere philanthropy, encompassing a strategic approach to societal well-being. The roots of CSR trace back to 1953 when American economist Howard Bowen coined the term in his seminal work, “Social Responsibilities Of The Businessman,” earning him the moniker “Father of CSR.” Effective April 1, 2014, India has legally mandated CSR action through the Companies Act..
However, amidst this noble mandate lies a complex reality. While companies allocate substantial resources to CSR, ensuring impactful execution remains a challenge. Often, CSR activities are confined to presentations and photo collages, or outsourced to lesser-known NGOs, resulting in a disconnect from ground realities. The intricate web of intermediaries further dilutes the impact, exacerbated by a dearth of experts proficient in impact assessment studies.
Recognizing the need for accountability and transparency, the Indian government introduced mandatory CSR Impact Assessment in 2014. This regulatory amendment has catalyzed a paradigm shift in India’s CSR landscape, placing greater emphasis on monitoring and evaluation to ascertain tangible outcomes. The requirement mandates corporates with significant CSR obligations to conduct independent impact assessments for projects exceeding Rs. 1 crore, ensuring accountability and effectiveness. With an estimated yearly expenditure of Rs. 25,000 crores plus on CSR in India, the imperative for effective implementation has never been greater. As the CSR landscape evolves, the fusion of regulatory compliance, technological innovation, and entrepreneurial spirit promises a future where CSR transcends rhetoric, embodying a genuine commitment to societal advancement.
Iftekhar Pathan, Co-founder of Metta Social, opines, “As a co-founder driven by creating meaningful impact, observing India’s CSR evolution is truly inspiring. Rs 25k crore currently spent annually by corporate India and a total philanthropy of more than 1 lakh crore. This shift signifies more than just fulfilling responsibilities; it embodies a sincere commitment to social entrepreneurship. CSR is a precursor to ESG; it’s a catalyst for Philanthropy 2.0, where empathy and tangible outcomes come together to forge a brighter, more compassionate future for everyone. $40 trillion being transferred from the old generation to the young Philanthropists is the largest philanthropy fund, and the next-generation philanthropists are a formidable force, one to reckon with. Incubators like IIT Kanpur FIRST, BHAU, Anjani Mashelkar Foundation have some amazing Social entrepreneurs creating products that have a very high impact on society. For sure, it is a rapidly changing philanthropic landscape in India and worldwide.”
The regulatory framework has spurred innovation within the CSR ecosystem, propelling social organizations to the forefront. These entities, leveraging technology and entrepreneurial acumen, bridge the gap between corporates and beneficiaries, ensuring the efficient flow of resources and maximizing social impact. By scrutinizing the implementation process and fostering sustainable solutions, social impact entrepreneurs are redefining the CSR narrative, driving meaningful change at scale and ultimately adding the value to last mile beneficiary.
