Adani Total Gas Ltd contributed Rs 10.27 Crores towards CSR activities in through the Adani Foundation, the CSR arm of the Adani group. The contribution was used in building a Biogas plant at Varanasi. Adani Foundation made an association with the Municipal Corporation in the Shahanshahpur area of Varanasi and set up a Gobardhan Bio-Conversion Project (Biogas Plant). Accompanied by various other similar initiatives, the CSR spend in the country rose over 25,000 cr INR in FY 21-22 according to media reports. Many MNCs that have operations in India have significantly contributed to the CSR spend of the nation and did their part in adding value to the society.
“Corporate Social Responsibility remains at the heart of the Group’s actions and strategy, and this is how we achieve a meaningful alignment between our vision – to be the worldwide leader in light and sustainable construction – and our Purpose”, mentioned Claire Pedini, Senior Vice-President, Human Resources and Corporate Social Responsibility, Saint Gobain Group.
It is very important for companies to understand the primary idea about CSR initiatives and how can fulfilling these responsibilities lead to business growth and help in creating a good reputation in the market. However, before taking decisions for CSR, companies must focus on some of the aspects that might pose challenges to the implementation of the project.
Defining the meaning of a CSR strategy with respect to a business or its respective industry is one of the first challenges for implementation. Various motives like ethical sourcing, community engagement, diversity and inclusion, environmental protection, labor standards and human rights can become a motive for CSR but all these aspects are not always relevant or necessary for businesses.
In order to align CSR objectives with the core business of a company, businesses first need to conduct an identification of the key stakeholders, make assessment of their material impacts, and finally prioritize their CSR goals based on the company vision, mission, and values.
One example of a company that has defined CSR (Corporate Social Responsibility) scope and goals is ExxonMobil Corporation. ExxonMobil is one of the world's largest publicly traded oil and gas companies. ExxonMobil has established specific CSR goals related to environmental stewardship, safety, community engagement, and economic development. Their CSR scope includes initiatives aimed at reducing greenhouse gas emissions, minimizing environmental impacts associated with their operations, promoting workplace safety, supporting local communities, and contributing to sustainable development.
After aligning the CSR motive with the business of the company, the next challenge that is faced is related to the measurement of the outcome of the project. Here, a company needs to measure the outcome of a CSR activity and make a complete report out of it.
In this regard, companies must establish indicators that are relevant and clear, try to accumulate consistent and reliable data and must be in constant communication with the stakeholders for sharing the progress of the project. For SMEs and MSMEs however, the measurement and reportage of the CSR project can prove to be costly and complex considering the lack of resources they might have. But every company must conduct this exercise how much ever can be possible even with limited resources.
One example of a company that has actively engaged in CSR (Corporate Social Responsibility) performance measurement and reportage is General Electric (GE). GE is a multinational conglomerate operating in various sectors such as aviation, healthcare, renewable energy, and power generation. Over the years, GE has been committed to CSR initiatives and has implemented robust measurement and reporting mechanisms to track its progress in various areas of sustainability.
Companies may further face challenge during implementation of CSR project in aligning and engaging with stakeholder interests. There are various stakeholders at every level of the company that can be interested in the CSR performance. These include local communities, media, NGOs, regulators, investors, suppliers, employees and customers.
In order to solve this challenge, companies must first understand the expectations and requirements of the stakeholders. They need to get them involved in the decision-making and implementation process of CSR projects. Companies further also need to address any kind of potential conflicts or trade-offs that can take place.
One example of a company that actively engages with stakeholder interests for CSR (Corporate Social Responsibility) projects is The Coca-Cola Company. Coca-Cola, a multinational beverage corporation, has a long-standing commitment to CSR and actively involves stakeholders in its CSR initiatives. The company engages with various stakeholders, including consumers, employees, suppliers, local communities, governments, and non-governmental organizations (NGOs), to understand their perspectives, concerns, and priorities related to sustainability and social responsibility.
Integrating a CSR strategy into the core business strategy creates yet another challenge for companies at large. This generally happens when CSR is looked as an operation separate from the business but not as an integral part of business operations which provides a competitive advantage.
In order to overcome this, companies must align the CSR objectives with the core business objectives and strategies. The idea is to embed all CSR principles into the policies and business operations and try to promote a CSR culture among their leaders and workforce. To achieve this, changes need to be made in the organization structure, business governance and model.
In this regard, Interface is renowned for its commitment to sustainability and its mission to become a restorative business. "Mission Zero" initiative can be called as one of the most notable examples of CSR integration by the company that was launched in 1994. Mission Zero sets ambitious goals for the company to eliminate its negative environmental impact, including goals related to waste reduction, energy use, and greenhouse gas emissions.
Another challenge that arises during the implementation of a CSR strategy is to adapt to the changing landscape of CSR. It needs to be understood by businesses that CSR is not a fixed or static concept but a subject of dynamic and continuous changes which are dependent on the changing demands of the market and society.
To overcome this aspect, companies need to conduct thorough research and anticipate all the trends in the market that can have an effect on the CSR performance. These trends include stakeholder activism, human rights, digital transformation and climate change. Businesses also need to have a level of flexibility in CSR approach and keep room for improvement to make changes in strategy.
To give an example, an organization that has notably adapted to the changing CSR landscape is Starbucks Corporation. It has demonstrated a strong commitment to CSR over the years and has continually evolved its approach to meet the shifting expectations and challenges in the CSR landscape.
Seamless implementation of CSR projects can be achieved if businesses take care of these challenges and stay innovative in their approach. Balancing the cost of CSR projects can also pose challenges in implementation which is why proper audit of costs must be done in accordance with the spending capacity of the company.
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