Feature

CSR in the time of recession

One would assume that a tight budget would curtail CSR efforts in most organizations. Sudipta Dev discovers that on the contrary, most organizations have devised ways to beat the recession as far as their CSR initiatives are concerned

Corporate social responsibility or CSR, goes beyond the purview of initiating a few welfare activities to being an instrument of social development. Most organizations today understand it is a business imperative and an important part of the corporate strategy. So much so that despite the downturn and tight budgets when one would expect companies to go slow on such activities and projects, most organizations have continued to drive their CSR projects with the same focus. And when budgets could not be expanded as per the requirements, innovative alternatives have come to the rescue.

The business connection

It is imperative for businesses to not spend time and effort on CSR projects that they cannot relate to. Every organization has a core competency that when applied in the right way it will yield results not only for its beneficiaries but also bring about a value addition to the business itself. “A business is most successful when it can meet the expectations of all its stakeholders and stakeholders here are not limited to a company’s direct connections like customers, partners, suppliers or employees. They include the society as a whole. Social justice and development must be the cornerstone of a business’s engagement with its stakeholders,” said Praveen Sahai, Head-Strategy, Marketing and Corporate Affairs, EMC Data Storage Systems, India.

It is also interesting to note how some organizations have tied up their business strategy for the tough times to their commitment to sustainable development. In today’s challenging economic climate, one might think that businesses have far greater preoccupations to consider than addressing the notion of sustainable development. Arun Seth, Chairman, BT India in fact believes that the case for sustainable development has never been stronger. “Sustainability has become a core business issue that offers rare opportunities in a tough climate. And history will show that those companies who are best able to grasp the importance of sustainable development in these challenging times and, integrate it into the very core of their businesses, will come out of this global downturn much better placed to achieve long-term, sustained success,” added Seth.

The driving force of CSR activities at BT has been its focus on not merely ‘green’ but on broader corporate responsibility and sustainability. “We are constantly looking at the impact of our core business activities across the spectrum of environmental, social and economic issues,” stated Seth. From BT’s perspective, the strategy is to grow its business in a way that benefits its customers and the society and to use communications technology to help tackle social and environmental challenges. “We have built a world-class CSR performance, which we believe is the foundation of a responsible company. We are harnessing communications to help tackle climate change and we are helping create a more inclusive society that enables sustainable economic growth,” explained Seth.

“CSR makes sound business sense. A growing number of companies and institutions in India are seeking to link their own growth and survival to the social cause they try to promote. There is a much larger reason for companies investing in CSR, grounded in the reality that business cannot succeed in a society which fails,” stated Mamtha Sharma, Manager-Corporate Citizenship & Corporate Affairs, IBM India/South Asia. For an organization that spends $150 million annually on CSR initiatives worldwide, including India, most of the CSR initiatives of IBM are ongoing campaigns, designed to impart education to lesser-privileged children across age groups through technology.

Sharma acknowledges that IBM strives to underscore the role of technology as a tool to address societal issues, demonstrate its reputation as a solutions provider; and focus on philanthropic programs to enhance relationships with customers and employees. This policy of strategic investments has benefited communities by bringing IBM experts from all over the world to address their concerns, and has engaged its employees more fully in the important mission of corporate citizenship. Sharma added that IBM is contributing more than just money, “We are dedicating our world-renowned researchers, educational consultants, and technology. Through these contributions, we are finding new ways for technology to spur and support fundamental school restructuring and broad-based systemic change to raise student achievement.”

It is important to recognize CSR as part of CR—a more comprehensive program. CSR and CR actually can become the heart and soul of the business, thus making a substantial contribution to the success of a company that always works for the right cause. “Today, the driving force behind Corporate Responsibility is not just the moral desire to meet commitments in being responsible citizens, but economic considerations and our environment and market place as well. Hence, the program becomes all the more important in tough times,” conceded Debi Prasad, Head-HR, Atos Origin India.

A commitment beyond money

It is probably the fact that CSR requires a commitment from organizations that goes beyond the monetary aspect that can actually keep the projects going despite the cost cutting measures that most organizations are resorting to these days.

Alternative and innovative solutions can sustain these efforts on a long-term basis. “A successful CSR initiative does not require financial commitment as much as it needs credibility and sustainability,” agreed Sahai, pointing out that organizations have a variety of ways to meet their societal obligations without burning a hole in their finances.

“Organizations need to look beyond just monetary contribution through CSR but make intellect knowledge as a prime mover to help social upliftment. Also, the participation of employees across the board is a must to sustain such initiatives. The day each of us realize the importance of such initiatives, we will be able to make a big difference in the society,” said Deepak Menaria, AVP People Development, GlobalLogic. The CSR initiatives of the organization focuses on two important areas—education and environment.

Most organizations are well aware that CSR is an investment and not an expenditure. They need to have realistic and sustainable projects and should have the tools to calculate the impact of these projects. Simple efforts within the organization can go a long way in making a difference. “Organizations should promote CSR within the company by saving paper, going green, encouraging employees to suggest cost-effective ideas to do CSR, etc.,” suggested Manuel D’Souza, Chief Human Resource Officer, Intelenet Global Services. Despite the current scenario, Intelenet has continued with its efforts to support causes it has committed to over the years. The company has also continued to hire people irrespective of any physical incapability.

GlobalLogic has a separate budget worked out for CSR activities for the entire year and hence recession is not affecting their CSR initiatives. This apart, their employees regularly fund the various education initiatives being undertaken by the group. Menaria’s solution for not letting CSR projects get affected by tight budgets is that as unusual problems need unusual solutions, fund constraints would result in more innovation in CSR activities and new initiatives would help in social development as well as help people sail through tough times. This apart, companies must maintain some percentage of their expenditures as fixed for such initiatives.

Research has proved that it is the economically successful businesses that have convincing corporate responsibility solutions. “Today, the driving force behind Corporate Responsibility is the combination of the moral desire to meet our commitments in being responsible citizens, and economic considerations. Companies are no more indifferent to how people respond to them and at the same time, public, customers and increasingly, investors too expect the companies to act responsibly,” averred Padmaja Krishnan, Director, Marketing and Communications, and Head Corporate Responsibility, CSC, India.

CSC’s CR initiatives have not been much affected by the recession. The organization believes that CR strategies are more widely defined than mere charitable spending. “We have always held that our people’s time and efforts towards the cause of CR and CSR is more important than just a sum of money towards charity. We have a well defined way in which we manage our CR programs so that as many of our employees can volunteer and are able to work towards being responsible corporate citizens,” said Krishnan.

It is not always budgets that run CSR initiatives—an organization through its sheer presence, reach and educated/skilled workforce, can make a difference by investing time, effort or even endorsement of a worthy cause. “We have had our employees volunteer for multiple causes sacrificing their weekends/holidays, etc. Small contributions by way of collecting old clothes, toys, etc., or visiting the aged in an old age home to spend quality time with them can make a big difference,” stated Tim Huiting, VP-HR, Convergys. Huiting acknowledged that not every initiative requires big budgets. However, it is important to lend sustainable support to causes that need assistance. It is necessary to first look at the ongoing CSR initiatives and prioritize them before looking at new ones. The idea is to ensure that the efforts don’t get so diluted as to minimize the impact.

Prasad agreed to the fact that the downturn has taken a toll on CSR activities in some organizations. For instance, a large global organization had announced in April this year that it will cut down on its CSR expenditure across Europe and spend the money in creating awareness of its products. Similar cuts were predicted in the US and Asia as well. Instead of resorting to such measures, Atos Origin has tried to bring about more employee participation, which in fact is the best solution.

Involvement of employees

Employee participation is critical for the success of any CSR initiative and most organizations try to ensure that their employees someway or the other feel involved with the projects being undertaken. In fact, organizations that have strong employee participation have seen the least impact of recession on their CSR activities. The ongoing activities have continued and new projects are in pipeline.

IBM provides a platform for employees to volunteer and make charity contributions. It had sponsored a global initiative, called the On Demand Community (ODC), which facilitated IBM employees and retirees to volunteer, by providing access to interactive tools and resources on the Web. “In India, today, about 12,000 IBMers are registered with ODC, involved in various social work across the country,” added Sharma.

GlobalLogic has a corporate responsibility group called the ‘GL Foundation’, which comprises volunteers from all the functions and delivery units. HR gives a lead to this group. Each individual aligned to this group are motivated to be part of this initiative for two reasons—self interest in social work and weightage in organizational initiatives during the performance appraisal process.

EMC’s Community Involvement department makes it easy for its employees to get involved, funding and otherwise, supporting numerous new and ongoing community-level programs. It provides employees with guidance and resources to initiate, maintain, and grow grassroot level activities on their own. “We are particularly proud of our employees. They support their communities in a myriad of ways, frequently with little or no corporate oversight. Each year our employees donate and raise thousands and sometimes millions of dollars for causes that address both local and global challenges,” added Sahai.

Participation in such activities brings about a great level of satisfaction and enrichment for the employees as well—while some find it a de-stressing experience, others feel a stronger bonding to the organization. “We involve our key assets—our people—towards this cause. This ensures a much better and sustainable impact to the society we are in than just money or charity,” asserted Krishnan. For instance, CSC has adopted villages where its employees regularly visit to help improve the quality of life of the local people. Similarly, many employees spend quality time with children in orphanages or the elderly in old age homes. Blood donation camps and Pulse Polio drives also get an overwhelming response from employees.

Being a relatively small company CDC Software does not donate a very high amount but there is active involvement with several organizations. The employees also contribute their efforts, time and money to various social causes and campaigns. “I always believe in grassroot level support. The top down approach is not sustainable, nor can it be sustained through constant prodding. But if you find enthusiasts in the organizations and empower them to act, they’ll have more impact in convincing fellow employees. CDC Conserves, our green initiatives are 100% conceived by our employees and run by them,” stated Nagaraja Prakasam, Managing Director, India CDC Software.

Greater participation of employees in CSR efforts leads to a win-win situation for all—the beneficiaries can interact directly with their benefactors, the employees feel enriched through these experiences, and the organization is free from budgetary constraints of driving such initiatives.

sudipta.dev@expressindia.com