Do you know about - Corporate collective responsibility in India - An Empirical investigate
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India has come to be one of fast growing economies of the world. It is growing at the rate of 9 per cent p.a. As an emerging market all are looking at India from an international perspective. At the stage when India is set to gain a global position, it is necessary to gauge whether the economic increase is due to flourishing business operations. Organizations must perceive that government alone will not be able to get success in its exertion to uplift the downtrodden of society. The present societal marketing concept of associates is permanently evolving and has given rise to a new concept-Corporate social Responsibility. Many of the foremost corporations over the world had realized the point of being associated with socially relevant causes as a means of promoting their brands. Cause-related marketing and corporate social responsibility has in case,granted associates with a new tool to compete in the market. Csr refers to the corporation's obligation to all the stakeholders. It stems from the desire to do good and get self satisfaction in return as well as societal obligation of business. This could be a strategic marketing performance a way for a business to do well by doing good-distinct from sales promotion, corporate philanthropy, corporate sponsorship, corporate Samaritan acts and social relations. Now, it is assumed to be responsibility of the business houses too.
Nothing builds brand loyalty among today's increasingly hard to please consumers, like a company's proven commitment to a worthy cause. Other things being equal many consumers would do business with a business that stands for something beyond profits. In nutshell, Csr and cause associated marketing results in increased sales, visibility, and buyer loyalty and enhanced business image along with sure media coverage.
Rural India has a habitancy of 700 million habitancy spread over 6,38,000 villages. Thus more than 60 per cent of India's total habitancy is rural by nature. A description by National Council of Applied Economic research (Ncaer) shows that rural consumers contain more than 50% of consumers and are a prime market for buyer goods and necessary services. Culture is the pillar of our country and if the pillar has strength, then it can raise our country to a top level. Organizations are helping to keep as well as revive the rich culture of the country through their programs. Today, India's literacy rate stands around 65 per cent, up from 52 per cent in 1991. (Nsso Survey) considering the rate of increase, it would take some 20 to 25 years to clear this problem. Hence, the Csr agenda of corporate think rural improvement as one of the foremost dimension.
On the other hand, a nonprofit organization is an organization, which exists for providing some advantage or aid or a sort of self-help group. Like the name suggests, the organization will have all the properties of a profit-making organization, i.e. A mission statement, a vision, offices, infrastructure etc., but the objective will not contain manufacture a profit out of its operations. However, to run any organization, funds are needed, and this has to come in to the non-profit in terms of financial i.e. Grants, subsidies, donations etc or services in terms of staff keep or infrastructure support.. The sources for these funds could be individuals, the government or other charitable institutions and ultimately companies. These business houses through their Csr (Corporate social Responsibility) initiatives lead to the mission of social expand and increase of India.
Defining Corporate social responsibility
Definitional issues concerning "corporate social responsibility" (Csr) have been debated since many years. Early Csr models was initiated in the early 1960s.It showed the "social" aspect of Csr as referring directly to those responsibilities above and beyond economic and legal obligations (Carroll, 1979; Waddock, 2004; Matten and Crane, 2005). Many carefully corporate social responsibility synonymous with voluntary and philanthropic acts by business organizations which are designed to alleviate social ills or in order to advantage a disadvantaged group chosen by the corporation's managers.
The World business Council for Sustainable improvement in its publication "Making Good business Sense" by Lord Holme and Richard Watts, used the following definition. "Corporate social responsibility is the chronic commitment by business to behave ethically and lead to economic improvement while improving the potential of life of the workforce and their families as well as of the local community and community at large"
"Csr is about capacity building for sustainable livelihoods. It respects cultural differences and finds the business opportunities in building the skills of employees, the community and the government" "Csr is about business giving back to society.
Traditionally, Csr has been defined much more in terms of a philanthropic model. associates make profits, unhindered except by fulfilling their duty to pay taxes. Then they donate a sure share of the profits to charitable causes. It is seen as tainting the act for the business to receive any advantage from the giving.
According to Philip Kotler, "Corporate social Responsibility: Doing the Most Good for your business and Cause" does a frightful job of describing the range of corporate social initiatives and suggests best practices for choosing, implementing and evaluating them.
Thus, corporate social responsibility has been a topic that has received a lot of attention in new years (Sethi, 1995).
Need for study:
The basic aim of the study is to gain familiarity or formulating a problem or to accomplish new insights into it. In this particular study, an exertion has been made to perceive and gain understanding into behavior or attitude of associates towards various aspects of social contribution. This study deals with the behavior of the corporates. It tries to identify involved behavior and set patterns in it. The present study relates to the attitude of 50 associates in India so as to predict the behavior.
Why will any business give funds or services to a non-profit? The government will supply for funds and or services as it is responsible for the social welfare of the people. Similarly a charitable institution will do the same as it is their objective to help the social cause. An individual may donate to a nonprofit due to reasons of philanthropy, or in memory of some person etc, but why does a commercial organization lead for a social cause? The basic objective of a commercial organization is to make profits. Why will it divert huge funds to a nonprofit if there is no return on that investment?
Objective of the study:
The objective of the study was to try and understand why an organization contributes to a social cause and what it expects to gain in the process. Is it philanthropy, is it a feeling of obligation to the community in normal or is it for financial benefits in terms of tax exemptions, etc.
Research organize process:
To understand the presuppose why an organization contributes to a social cause, it was necessary to get an understanding into the organizations' view of the business, its views , its policies , the reasons why it contributes and its objectives and relationships with all its stakeholders i.e. Employees, customers, suppliers, shareholders and society. The questionnaire was designed accordingly to get the relevant facts from the respondents.
In this study the researchers have adopted convenience sampling. habitancy of study includes associates located in India.
Sources of Data Collection:
The research consists of the application of both customary and secondary data. customary data was collected by administering questionnaire.
The secondary data was collected through websites and from various journals and magazines. Reasons for gift to Csr by organizations were a sensitive issue. Hence the researchers had to gain the belief of the supervision otherwise a study of this nature was impossible.
The questionnaire was administered to various companies. Anonymity of responses was promised. While it was sent to about 70 companies, only 50 associates responded. The responses were obtained through the human resource departments of the business or indirectly through the involved department or valid handling the area. The questionnaire was coded into Spss and then the data from the questionnaire entered into the database. While frequency and cross tabulations were used for most of the data analysis, factorization was used to group attributes, which were foremost reasons for contributing to a social cause.
The pathology and Findings:
Views towards business: 82.4% of the associates seem to strongly agree that business means maximizing benefits, manufacture money and doing your work well. No business disagrees on this point. 17.6% more agree than disagree to the same. 76.5% says that business is manufacture money. 88.2% strongly agree as well as agree that it is all about social responsibility while 17.8% more disagree than agree.
Place for ethics in business: 88.3% believe that there is place for ethics in business. However, a small majority, 11.8% strongly feel that there is no place for ethics in business.
Business & Economic attitude: 82.3% believe that business needs only an economic attitude while 17.7% respondents felt that business does not need an economic attitude, balance feel it is needed.
Social policies: 70.6% of the corporates associate to the community through social activities, and 23.5 % through specific Ngo. Only half (52.9%) have a clear-cut policy on social development. 64.7% feel that their social responsibility is towards both the community and their employees. 29.4% feel that their social responsibility is only towards their employees. 35.3% have not adopted any village or social organization. The participation of the business in various activities is mixed, with no clear-cut trend emerging.
Donations: 70.6% feel that giving a donation will not increase the image of the company. However, 29.4% give donation to advantage from tax.
However, cross tabulation of these two parameters revealed that only 71.4% respondents who said that donations do not enhance its image while 28.6% respondents say that giving donations improves image building. About 50% lead to a social cause, invest as a long-term investment. 70% responded that they do not donate for tax.
Credo of the organization:
Principal Component Factor pathology methodology was used with varimax recipe to identify the relevant factors which has been consistently identified as customary by the respondents. The rotated component matrix was used, as it would be easier to resolve which variables are loaded on which factor.
Factor pathology shows that 4 main factors used by organizations as their credo. The first factor 1 as business value: internal stakeholders which contain humane approach, worker and customer satisfaction, potential of life.
Factor 2: profit Maximization, which contain team work and profit maximization.
Factor 3: social Responsibility, which combines with hard working behavior.
Factor 4: Ethical Practices
Csr: Objectives and Relationships with stakeholders:
Customers: 47.1% have their objectives towards the customer as satisfying them by providing quality, and within this, 50% term their association as friendly. Someone else 29.4% objective is to give good value and satisfactory service.
Shareholders: 41.2% objectives are more towards good returns and 35.3% express the real picture of the company, while 23.5% assure profit to its shareholders.
Employees: 64.7% feel that their objective towards the employees is to motivate to accomplish goals and rewards, 23.5% satisfy by fulfilling needs while 5.9% feel that their association is that of family feeling and Someone else 5.9% supply them with an chance for self development.
Suppliers: 5.9% have their objective as mutual benefits, which also explain that it feels its association is that of a teammate (29.4%). balance is equally divided in terms of relationships. Practically 47.1% company's objective vis-à-vis suppliers are potential and price of stock related.
Community: Over 52.9% of the associates have social welfare as the objective towards the community. 11.8% associates have stated that their association with the community is that of a family member so as to supply help to the target group who needs it and 17.6% have stated that their association is cordial and friendly. They are sensitive to the needs of the community and Someone else 17.6% contain community welfare in the objectives of the company
Attributes as foremost reasons for contributing to social causes:
The present study of the researchers is to study the presuppose of the company's corporate social responsibility. The variance chart and the scree plot show that 4 components explain 83.03% of the variance. The necessary component pathology was used using varimax rotation method. The rotation converged in 5 iterations. The resultant rotated component matrix was analyzed. The constituents of the four factors are identified as
Factor 1: (Customer oriented)
Customer goodwill .966
Customer loyalty .966
Philanthropy .752
Factor 2: (Ethical oriented)
Projecting the business as one with explicit moral judgment .873
Projecting an upright character of the business .944
Contributing to a specific cause .637
Bottom-line benefits .618
Factor 3: (Community oriented)
Helping the community .894
Social responsibility .889
Factor 4: (Humane oriented)
To take off the image of the business as a faceless institution. .903
Bottom-line benefits - .542
Philanthropy in the first component and bottom-line benefits in the second component seem to be out of line of the components. Else the first component talks about customer relationships, the second on moral character of the business and the third on social responsibility. Bottom-line also plays an foremost role.
Conclusion:
The study was conducted to find out the company's reasons towards corporate social responsibility on cause associated and its impact on the company's brand image and sales. The foremost factors that influence the business to lead are: customer oriented, Ethical oriented, community oriented, Humane oriented.
Financial benefits in terms of tax benefits also are important, though the responses to this issue seem to be guarded.
Companies must create awareness to the various stakeholders concerning its gift to corporate social responsibility through its affiliation with social cause through event supervision (Mumbai marathon events) & business websites as it is directly associated to increase in sales and brand loyalty. India being a developing country with over 250 million strong middle class families has a large inherent for any marketer & at the same time it can keep quiet a good number of causes which benefits the community at large. E.g. Due to execution of Cry' a Ngo 89244 children lives were permanently transformed 1013 communities experienced 100% school enrollment, 159 customary condition centers began functioning and long term restoration agenda were initiated in Practically 100 tsunami affected villages in Tamilnadu, Andhra Pradesh and Kerala and earth quake relief & restoration programs were initiated in 11villages in Jammu & Kashmir. So we can cease that corporate social responsibility and cause associated marketing is beneficial both for business and the society.
Limitations:
While associates have responded, 25% of them (spokesman) have requested that the source should not be mentioned - i.e. The business should not be identified. The sample size being very small, the effect of the study may not record the whole population.
References:
Carroll, A.B. (1979), "A three-dimensional conceptual model of corporate performance", Academy of supervision Review, Vol. 4 No. 4, pp. 497-505.
Matten, A. And Crane, D. (2005), "Corporate citizenship: toward an extended theoretical conceptualization", Academy of supervision Review, Vol. 30 No. 1, pp. 166-79.
Sethi, S.P. (1995). "Introduction to Amr's special topic forum on shifting paradigms: Societal expectations and corporate performance." Academy of supervision Re view, 20, pp.18- 21.
Waddock, S. (2004), "Parallel universes: companies, academics and the expand of corporate citizenship", business and community Review, Vol. 109 No. 1, pp. 5-42.
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