New Delhi: As research links corporate social responsibility (CSR) with both tangible and intangible benefits, such as enhanced brand perception and market share and leadership among rivals, an increasing number of companies are looking at expanding the scope of their CSR initiatives.
Some Indian companies are trying to involve their employees to augment their CSR efforts. To encourage employees to participate in social and community work, they are offering various incentives.
In a day’s work: Du Pont?employees at a CSR initiative. Many? firms are institutionalizing such programmes
The Mahindra group, one of the country’s leading business houses, for instance, is offering an Esop or employee stock options scheme of a different kind. Under its Esop programme, it doesn’t give its employees any stocks; instead, it offers them social options for various community services. “We formalized the Esop programme to ensure that CSR doesn’t remain just a management undertaking but involves all our employees,” says Rajeev Dubey, president, human resources and corporate services, Mahindra and Mahindra (M&M).
Interestingly, M&M has made Esops one of the key result areas (KRA) for its senior and middle management employees. The company has linked Esops with the performance pay of the employees. “Esop is an important KRA for some of our senior and middle management employees. Employees with a higher Esop score are likley to get higher performance pay benefits,” says Dubey.
There is an Esop leader and an Esop champion at each M&M office, who chart out various community initiatives. Then, there is a committee that ensures maximum employee participation. Around 7,500 employees of the 44,000-plus group have been involved in various such projects.
Similarly, employees at Ballarpur Industries Ltd (Bilt), one of the country’s leading paper manufacturing companies, are encouraged to spend two working days a month on voluntary social work.
Around 600 Bilt employees are currently involved in various community projects ranging from microfinance to education and health care in some 200 villages around the company’s six manufacturing locations in four states.
All management trainees at Bilt have to go through a mandatory three-week CSR programme. “Employees are the soul of a CSR programme. A social programme that doesn’t involve employees is like a public relations exercise,” says Yashashree Gurjar, chief general manager and head, CSR, Bilt. The company is popularizing the initiative among its employees by compensating those involved in community work with additional holidays.
Recent research reports have pointed out that consumers prefer products from companies which are socially responsible, and that CSR initiatives help companies in building leadership in the market.
A recent survey by global human resources services company Hewitt Associates revealed that CSR is an important factor in helping a brand get a leadership position in the market.
According to the survey—done in partnership with the RBL Group, a firm helping clients increase quality of leadership, and Fortune magazine—around 90% of the top companies in the Asia-Pacific region, including India and China, said CSR was a significant component of their corporate brand and 80% credited it with their leadership brand.
So far, the prevalent practice among companies was to partner with non-profit organizations and limit their role to funding only, but now companies are themselves getting involved in CSR projects. “Employee participation in CSR activities makes it easier for companies to connect with the consumers and the environment in which they operate,” says Shefali Chaturvedi, director and head, social development initiative, the Confederation of Indian Industry, an industry lobby. Adds M&M’s Dubey: “CSR, in fact, provides a competitive advantage in a changing business climate where it is not enough to make profits, take care of employees and pay taxes.”
Companies are, in fact, making big investments to find out if their social initiatives are yielding results. Dabur India, for instance, engaged an agency called ASK, or Association For Stimulating Know How, to find out if its CSR efforts were moving in the right direction. “We have two dedicated staff on our rolls, apart from a 12-member team, to facilitate community work,” says A. Sudhakar, executive vice-president, human resources, Dabur India. The company plans to hire two more people by the end of the year. “We engaged ASK to find out if we were moving in the right direction,” adds Sudhakar. ASK is an organization based in the Delhi suburb of Gurgaon involved in studying the impact of CSR initiatives on companies.
Experts point out that volunteerism has yet to take off in India and, hence, companies are having to incentivize their efforts with employees. “Although companies are making good attempts to involve their employees, there is no large-scale systemization of CSR in organizations,” says Chaturvedi. Drawing employees to such initiatives still remains a big challenge, say human resources managers and CSR heads. “It is not easy getting employees who are generally grappling with deadlines and production targets into the CSR fold,” says Sushil Singh, head, CSR implementation, M&M.
Incentivizing the efforts, thus, is imperative. M&M plans to make Esops a KRA for all its employees. Bilt is also working on a similar plan.
EI du Pont de Nemours and Co., the science and technology company, has extended its global CSR programme, called DuPont Community Fund and DuPont Volunteer Recognition awards, to its India office. The company encourages active voluntary participation and recognizes employees through various awards. The winner is given a cash prize which, though, goes to the social cause she has been associated with. “But it is a recognition of the efforts, nonetheless,” says Krishnakoli Dutta, general manager, public affairs, DuPont India Pvt. Ltd.