Maratha Mandirs Babasaheb Gawde Institute Of Management Studies

Corporate Social Responsibility and Education in India

Ghanshyamdas Saraf Senior Vice Principal, Vaidya Bhavana, College Mumbai, [email protected]

Corporate Social Responsibility and Education in India

Objectives 1. To highlight the role of corporate social responsibility as an essential feature of corporate policy. 2. To focus on the need for corporate social responsibility to play a major role in Education in India. 3. To stress the inter-relationship between the roles of Government,corporate and education in India 4. Suggestions 1. CSR programmes should contribute a bulk of their resources to education. 2. Investments in research, spread of information and communication technology from school level onwards are the need of the hour. 3. Collaborations between Government, educational institutions and corporate will accelerate educational reform and thus bring about the desired social development.

Corporate Social Responsibility and Education in India

What is corporate social Responsibility? Corporate Social Responsibility (CSR) is becoming an increasingly important activity to businesses nationally and internationally. According to Lord Holme and Richard Watts "Corporate Social Responsibility is the continuing commitment by business to behave ethically and contribute to economic development while improving the quality of life of the workforce and their families as well as of the local community and society at large" As globalisation accelerates and large corporations serve as global providers, these corporations have progressively recognized the benefits of providing CSR programs in their various locations. Traditionally in the United States, CSR has been defined much more in terms of a philanthropic model. Companies make profits, unhindered except by fulfilling their duty to pay taxes. Then they donate a certain share of the profits to charitable causes. It is seen as tainting the act for the company to receive any benefit from the giving. The European model is much more focused on operating the core business in a socially responsible way, complemented by investment in communities for solid business case reasons. This model is more sustainable as Social responsibility becomes an integral part of the wealth creation process - which if managed properly should enhance the competitiveness of siness and maximise the value of wealth creation to society. CSR Initiatives in India is a blend of the above two models.

CSR is about building sustainable businesses, which need healthy economies, markets and communities. The key drivers for CSR are: Enlightened self-interest - creating a synergy of ethics, a cohesive society and a sustainable global economy where markets, labour and communities are able to function well together. Social investment - contributing to physical infrastructure and social capital is a necessary part of doing business. Transparency and trust - business has low ratings of trust in public perception. There is increasing expectation that companies will be more open, more accountable and be prepared to report publicly on their performance in social and environmental arenas. Increased public expectations of business - globally companies are expected to do more than merely provide jobs and contribute to the economy through taxes and employment. Corporate Social Responsibility (CSR) in the context of Globalisation

Globalization could lead to benchmarks, better jobs, higher standards of living, but could result in the gap between developed and developing countries broadening to the detriment of all. Thus, two key areas need to be managed by corporations, along with governments in the process of globalisation, talents (and the mobility of people with talents in demand) and trade. Developing countries need to learn to develop and also retain talent, and that requires a revamp of much of its culture including education infrastructure, legal systems, immigration policies and management policies, while arts and entertainment facilities will need to adapt to meet changing demands and more international tastes. A free and open trade and investment environment is necessary, but achieving agreement between many countries and cultures is difficult. A harmonious symbiosis of Global-Local approach incorporating a sense of social responsibility is required by corporations to help developing countries through their transition to knowledge societies. In this era of globalisation necessitating effective corporate governance, corporations have increasingly come to realize the need to share a common vision of corporate social responsibility though the contents and issues which it would encompass and the priority accorded to them would differ. Successful businesses realize the benefits of deep community ties, creating path-ways of exchange of information, energy and ideas. Increasingly companies are separating community management from public relations by opening up separate offices. According to Jack Greenberg, President and chief executive officer of McDonalds Corporation USA, the company works with local governments, to touch peoples lives at the grassroots level. Our commitments to social responsibility and to making profits are necessarily linked. Corporations need to realize that good causes can help improve a company's as well as a countrys image. The notion of corporate social responsibility is especially crucial in the case of developing or underdeveloped countries. In the case of mining companies of Latin America their earlier paternalistic relations with local communities resulted in suppressing initiatives in education. That relationship has now changed to greater partnerships with local communities. Therefore social responsibility is a means of managing risk and avoiding a big price to pay for lack of involvement. The case of Microsofts investment in India in different ways in the sphere of education (Project Shiksha) and health (namely in terms of eradication of HIV/AIDS) are worth emulating by other corporations. The case of Malayampa natural gas power project in the Philippines is worth mentioning in Shells commitments towards sustainable development. SmithKline Beecham's aim to eliminate elephantiasis and Liz Claiborne's efforts to increase awareness of domestic violence are some of the examples of corporations increasingly taking on the mantle of social responsibility. In this present era of globalisation as corporations are becoming more aware of their social responsibilities the traditional responses of companies contributing to good causes are dramatically changing from mere philanthropy. Despite the worthwhile support given by many corporations, an enormous amount could still be done. If companies each invest in one good cause with the same fervour, which they invest in their bottom lines, a huge step could be taken towards easing many social woes, particularly poverty eradication be it through investments in health education, knowledge management, etc. One of the key steps would be to thoroughly understand the local environment in which most companies operate. For corporations in the developing and underdeveloped countries, bridging the divide (digital, economic, social or environmental) in order to eliminate poverty should be the essence of the social agenda.

Corporate social Responsibility and Indian context Corporate social responsibility is represented by the contributions undertaken by companies to society through its core business activities, its social investment and philanthropy programmes and its engagement in public policy. In recent years CSR has become a fundamental business practice and has gained much attention from executive management teams of larger international companies. They understand that a strong CSR program is an essential element in achieving good business practices and effective leadership. Companies have determined that their impact on the economic, social and environmental landscape directly affects their relationships with stakeholders. Corporate Social Responsibility (CSR) has acquired new dimensions in recent years. The Indian context is distinct. On the one hand, there are long-standing traditions of respect for family and social networks, and high value placed on relationships, social stability and education. Diverse religions and cultures also bring distinct attitudes towards community social behavior and engagement as well as support and philanthropic contributions. Governments in the region also play distinct roles often stronger in terms of influence on economic and social priorities, yet not as advanced in terms of social safety nets. CSR is not a new concept in India. Corporates like the Tata Group, the Aditya Birla Group, and Indian Oil Corporation, to name a few, have been involved in serving the community ever since their inception. Many other organizations have been doing their part for the society. CSR has become increasingly prominent in the Indian corporate scenario because organizations have realized that besides growing their businesses it is also vital to build trustworthy and sustainable relationships with the community at large. Another reason fuelling this rapid adoption of CSR is the state of the Indian society. Though India is one of the fastest growing economies, socio-economic problems like poverty, illiteracy, lack of healthcare etc. are still ubiquitous and the government has limited resources to tackle these challenges. This scenario has opened up several areas for businesses to contribute towards social development. Today, CSR in India has gone beyond merely charity and donations. It has become an integral part of the corporate strategy. Companies have CSR teams that devise specific policies, strategies and goals for their CSR programs and set aside budgets to support them. These programs, in many cases, are based on a clearly defined social philosophy or are closely aligned with the companies business expertise. Employees become the backbone of these initiatives and volunteer their time and contribute their skills, to implement them. CSR Programs could range from overall development of a community to supporting specific causes like education, environment, healthcare etc. For example, organizations like Bharat Petroleum Corporation Limited, Maruti Suzuki India Limited, and Hindustan Unilever Limited, adopt villages where they focus on holistic development. They provide better medical and sanitation facilities, build schools and houses, and help the villagers become self-reliant by teaching them vocational and business skills.

On the other hand GlaxoSmithKline Pharmaceuticals CSR programs primarily focus on health and healthy living. They work in tribal villages where they provide medical check-up and treatment, health camps and health awareness programs. Many CSR initiatives are executed by corporates in partnership with Non-governmental organizations (NGOs) who are well versed in working with the local communities and are experts in tackling specific social problems. For example, SAP India in partnership with Hope Foundation, an NGO that works for the betterment of the poor and the needy throughout India, has been working on short and long term rebuilding initiatives for the tsunami victims. Together, they also started The SAP Labs Center of HOPE in Bangalore, a home for street children. CSR has come a long way in India. From responsive activities to sustainable initiatives, corporates have clearly exhibited their ability to make a significant difference in the society and improve the overall quality of life. In the current social situation in India, it is difficult for one single entity to bring about change, as the scale is enormous. Corporates have the expertise, strategic thinking, manpower and money to facilitate extensive social change. Effective partnerships between corporates, NGOs and the government will place Indias social development on a faster track.

Corporate social Responsibility and philanthropy CSR is also linked to the broader issue of Corporate Governance. Needless to emphasize that Indian companies have to take a closer look at CSR and link it to corporate governance, if they really want to make a mark in all the three pillars of CSR. According to a recent pilot survey by CII in Tamil Nadu, ( see Express Buzz 13th Jan) only 40 per cent of the companies practice CSR initiatives. The pilot survey, highlighted that a majority of the companies did not take CSR seriously and those who did, did it only with a philanthropic frame of mind. The pilot survey also revealed that more than 50 per cent of the companies made their employee welfare activities as part of their CSR initiative, not really contributing to an outside community or its development. While companies in India have started taking tentative steps in the CSR direction, apparently there is a long way to go. Historically, Indian companies had always strong philanthropic activities mostly targeting their employees and their families. However, if CSR has to truly become the soul and DNA of a company, then it has to break away from employee welfare mindset and encompass sustainable development. In India, though corporates have a strong will to dedicate their resources for a social cause, they find it difficult to reach the right people considering the demography and diverse social problems of the country. The uniqueness of Smile Foundation lies in its working model Social Venture Philanthropy. SVP seeks sustainability, scalability, accountability, transparency, credibility and effective leadership. Smiles governance structure has a 4 tier audit and evaluation mechanism to ensure right use of money and ultimately contribute a huge Social Return on Investment against traditional methods. Its working model has made Smile Foundation one of the most sought for charity brand today.

Four years ago, Reliance Industries Ltd. launched a countrywide initiative known as Project Drishti, to restore the eye-sights of visually challenged Indians from the economically weaker sections of the society. This project, started by one of Indias corporate giants has brightened up the lives of over 5000 people so far.

CSR and Education Today, public education faces the mounting challenges of standardized testing, strained budgets, teacher retention, and global workforce competition. At the same time, corporate America has added pressure to prove itself to consumers, investors, and government regulators. These demands have given way to new opportunities for businesses to support education in a win-win situation that benefits everyone. Businesses have begun to take a more targeted approach in their corporate social responsibility programs and are seeking to impact areas that have a correlation with their own business goals. For many businesses, education is an important part of their plans, since the needs exist in all geographic areas, across all subject areas, and for all kinds of people. The bottom line is that educational outreach efforts have the potential to make a real and lasting difference for all players involved. Companies get involved in education for a number of strategic reasons, including building a positive reputation and goodwill among consumers, employees, investors, and other stakeholders; developing brand recognition, whether to increase consumer loyalty, boost sales, or establish the company as an industry leader; building a more educated workforce; raising consumer awareness about a particular issue; and fulfilling a company mission or mandate Students, schools, and the general public can benefit from the experience and expertise that corporations bring to the table, particularly if the groups work together to ensure the right needs are being met on both ends. Companies looking to contribute to public school education, for instance, must consider the many demands that schools and educators face daily time constraints, tight budgets, technology access, standardized testing, and explicit curriculum standards as well as the unique places where outside help is needed. As long as they address the right needs, businesses have the ability to make a tremendous impact. By providing highly engaging resources, by building in strong connections with instructional needs, and by effectively marketing the resources, more and more companies are simultaneously meeting educational goals and their own business goals. Parents are enthusiastic about the industry involvement, too, so long as its positive and productive. A Michigan survey conducted in April 2007 by The Detroit News, The Skillman Foundation, and Your Child showed that 77% of parents think businesses should play a role in education, particularly by providing additional resources General Electric has a five-year, $100-million College Bound program to boost the number of high school students who go to college in certain school districts. The program encompasses math and science curricula, professional development, management capacity, and the involvement and expertise of GE officials. One school superintendent said the initiative combines high academic standards, best educational practices, collaborative relationships, and the expertise of a longstanding partner and global technology leader. In 2004, Citigroup announced the formation of its Office of Financial Education, along with a 10-year, $200-million commitment to financial education. Since then, the company has developed curriculum programs for aspiring entrepreneurs, college students with questions about credit, and pre-scholars who are just starting to learn about money, among others. Thousands of Citigroup employees volunteer their time to teach these

programs, which have reached people in more than 60 countries. Beyond curricula, some businesses get involved in the education world to train a new generation of employees. Last year, President Bush introduced the American Competitiveness Initiative to strengthen education, increase investment in research and development, and encourage entrepreneurship, with the goal of helping the U.S. maintain its global leadership role in science and technology. Professional development, particularly popular in biomedical sciences and engineering, allows companies to reach out and flex their strengths and expertise, while ultimately strengthening a potential pool of employees. Biotechnology giant Genentechs CEO, Dr. Arthur Levinson, recently said, Were hiring as many good people as we can out there, but theres not an infinite number of terrific people. To address the shortage, the company sponsors biotechnology workforce initiatives, offers financial assistance and internships to diverse students, and supports health science education efforts from K-12 through the graduate level. This type of comprehensive, focused, relevant involvement is key to the new direction of corporate social responsibility. A new era of corporate involvement and investment in education is here, with promise and opportunity framing the way forward. CSR and Education and technology The world has undergone a tremendous change with the advent and proliferation of information and communication technologies (ICT) such as the internet, email and wireless communication, whose impact (both positive and negative) is perceived in every sector of society and every corner of the globe. In this new era of knowledge society that has emerged in the course of human history role of corporations are extremely crucial in complementing governments efforts.

This is because people can no longer either underestimate or overestimate the potential role that digital divide could play. In this globalised economy, the role played by corporations engaged in such enterprise could reduce the asymmetries created by the digital divide within and amongst countries by utilizing the immense potential of ICT to the advantage of society per se the world over. Governments need to match the pace of change currently occurring in the world of information technology and e-commerce. But unlike businesses, governments are hindered in their ability to manage and lead change. Long-term strategies are forsaken in favour of shortterm frameworks, which yield measurable outcomes. With any major social upheaval there is always the danger that traditional values will be cast aside. However, in the Asian context values will remain intact and perhaps become even more important. In this context it is essential that an increased value be placed on education with a strong emphasis on ensuring that all members of society have access to the Internet. This means training teachers now, rather than waiting a generation until a new group of educators acquires computer and IT skills.

In this era of digital divide, the role of businesses entails joining forces with governments to help explain and promote long-term policies to affected populations. As a part of the India governments efforts a National Task Force on IT and Software Development was set up by the Prime Minister's Office on May 22, 1998, under the Chairmanship of the Deputy Chairman of Planning Commission, with a mandate to formulate the draft of a National

Informatics Policy, to make India an Information Technology superpower and one of the largest generators and exporters of software in the world within ten years. The 108 Recommendations of the IT Action Plan Part-I emphasize the Policy Framework required for creating an ambience for the accelerated flow of investment into the IT sector, with specific orientation towards the Software Industry. The Information Technology Action Plan Part-II furnishes 84 Policy instruments for the Development, Manufacture and Export of IT Hardware. The Task Force advocated that the software industry and the hardware industry are two sides of the gold coin representing India emerging as a global IT super power. The success of one, whether it is export of software of $ 50 billion by the year 2008 or IT penetration drive for realizing IT for all by 2008, depends on the concomitant success of the other. The strategic policies for the IT industry, IT Research, Design and Development, IT Human Resource Development, Citizen-IT Interface, Content Creation and Content Industry, Micro Electronics, Mission mode creation of fiber-optic infrastructure, financing the IT sector and organizational structure have been analysed in detail in the report In India there are many companies catering to IT education and training, like Infosys, Wipro, Tata Consultancy Services (TCS), NIIT, CMC, APTECH, DOEACC, etc., (providing IT education both in terms of creating a skilled and trained workforce, from the perspective of companies needs as also to aid the process of computerization be it the railways, banking, insurance, health, etc. as also providing basic computer training in order to access the mine of information presently available through internet). However, the problem that majority striving to gain access to computer education face is enormous expenditure incurred, much beyond the reach of the vast majority. For example, a three year course offered by say NIIT would approximately cost around 65,000-70,000 Indian Rupees, unlike a local grass-root organization, like NIC or say few cyber-kiosks, operating only in a particular Calcutta locality would be much less say around 10,000 Indian Rupees. The quality of education would vary if one were talking of creating an IT expert but it would not really matter if one were referring to an awareness of the basics of IT. Bridging the digital divide is not realized by merely creating a pool of IT experts but also through the spread of the basics of IT education and the usage of computers in a localized manner right from the school leveling a manner affordable and accessible to the teeming majority. For example, the touch screen computers and kiosks establish throughout Andhra Pradesh is a part of the governmental efforts in introducing e-governance is laudatory. However, in a state also marked by high suicide rates of farmers, poverty and absence of basic literacy in the rural interiors, such measures would only be effective in solving the plight of the farmers, if investments are also made in basic education and awareness and the usage of the computers, be it when farmers apply for a small loan or demand better irrigation facilities, or avail the benefits of ICT projects in rural areas, etc. Amongst multinational corporations Microsofts recently outlined future vision and activities in India is an example of the crucial role that MNCs can play in complementing governments efforts and realizing the vision laid out in Indias IT strategy of increasing citizen-IT interface through investments in education. The Microsoft Chairman, Bill Gates during his recent visit to India, envisioned an India which in the course of its journey towards the end of the first decade of the new millennium, would be one where individuals would be increasingly getting used to computer usage be it storing music, photographs or information. The end result of this increasing interface, leading

to a sort of dependence scenario would mean that in a country like India millions of people would be employed in the IT industry in high salaried positions. In a developing country like India marked by internal asymmetries that reinforces the digital divide, realization of the potential of the digital decade would entail enormous investments and structural changes at varied levels, namely spread of education (not merely basic literacy) at all levels, development of a reliable communication infrastructure and the software to connect the people of different communities with diverse socio-cultural, linguistic, religious and ethnic background. Project Shiksha (Rs.100 crore or US 20million dollar), launched by Microsoft to improve computer education in India, aims at training 80,000 school teachers who would be educating 3.5 lakhs students across the country is an important step in this direction. Apart from Project Shiksha, Microsofts strategy in India focus on localization efforts such that India adequately harnesses the benefits of the ongoing globalisation process by launching Windows XP and Office in Hindi within the next year (2003) and would also envisage Windows XP local language support to Bengali and Malayalam. Such initiatives can be categorized as far from mere altruism. They cannot be categorized as charity either as Microsoft also declared its intention to invest US $389 million (rs.1900) crore in India over the next three years, which accounts for the companys largest investment outside the United States. Despite the plethora of companies engaged in IT education large medium and small including grass-root organizations, the challenge of bridging the digital divide and removal of asymmetries within different regions in India tailor-made to suit the varied diversities continues to persist if the long-term potential of India in the field of IT is to be realised. Efforts of Microsoft are indeed exemplary and go a long way to suggest that corporations the world over, through long-term investments in both research and the spread of information and communication technologies right at the school level, do have a crucial role to play in bridging the digital divide in terms of complementing existing governmental efforts. Challenges encountered by business in the developing world The major challenges faced by business towards reducing the digital divide existent within and amongst the countries of the developing world, including India can be identified as follows: Governmental barriers arising from differences in forms of government and types of regime marked by excessive regulation in important spheres highlights the crucial issue of absence of good governance and requisite political will. Financial barriers dependent on the level of economic development due to lack of adequate resources and the failure to avail of cost-effective technologies. Technological barriers stemming from the non-availability of adequate infrastructural facilities. Social barriers that are a result of the economic and cultural disparities between the elite minority and the vast majority. Cultural barriers due to educational disparities raise the crucial issue of how to make the educational significance of Internet and the consequent access to plethora of information relevant to the majority of the world populace. Education and CSR- the challenges ahead

To enable educational institutions to cater effectively to changing economic and industry needs, our educational policy should encourage greater collaboration between industry and universities in curricula and course design as well as industry research. There are several examples of industry academia collaboration in India. ICICI Bank has worked closed with deans and professors of several colleges to help develop course content and to provide visiting faculty to these colleges. Bharti Tele-Ventures has set up a telecommunication training school at IIT, Delhi. Infosys has established campus connect, an initiative to enhance the quality of teaching in technical colleges in India. Infosys also provides 26 Ph.D. scholarships in the IITs, the IIMs, IIS and a few engineering colleges. The Government should also encourage more collaboration between industry research institutions and colleges through tax incentives and a deregulated environment for research. Even if we need more monetary resources, we would do well to remember the words of Robert Bok, former President of Harward University who remarked, and If you think education is expensive, try ignorance! Conclusion Corporate Social Responsibility has many facets. Companies have been finding various innovative alternatives to discharge their social responsibility. Education is the sector which is the most eligible and socially rewarding effort for any corporate to be looked upon to discharge its social responsibility. Supporting education at any level will mean, re-energized education sector which can transform our country into a true knowledge power and realize a future of prosperity and growth.

Bibliography/references a. Books 1. Corporate Responsibility, Blowfield. M.- Oxford University Press 2. A Guide to Corporate Governance, N Gopalasamy- New Age International 3. A Better India, A Better World, Narayan Murthy-Penguin Books 4. Corporate Social Responsibility-Challenges in the age of Globalisation, P.V Khatri/ Indu Baghel- Global Vision Publishing house 5. Remaking Higher Education: Essays in dissent. Amrik Singh- Harper Collins b. Websites 1. www.timesfoundation.indiatimes.com 2. www.indianet.nl 3. www.globalissues.org 4. www.acme-journal.org