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Extent of Contribution by Businesses

Corporate Social Responsibility (CSR) has been defined in ways by different individuals and associations in different ways. As defined by Mallen Baker (2006) “CSR is about how companies manage the business processes to produce an overall positive impact on society. ” Thus the essence of CSR is how the businesses fulfill their obligations to the society in terms of their social, economic and environmental commitments to the community in general. The principal object of any business in the modern day competitive business environment is the profit maximization.

In the process of achieving this objective, they infringe on the natural resources either wantonly or involuntarily which has a detrimental effect on the people living on the earth. In order that the business houses are imposed a control on the extent of their infringement the concept of CSR had been evolved. But what is to be assessed is that whether the businesses have really understood the evil effects of their infringement and do something to change their courses of action. This is possible only by putting certain obligations on the part of the industrial and business houses towards their CSR.

This paper though short attempts to explore how well the CSR concept has been received by the business and also the necessity of exerting legislative pressures on the companies for meeting their CSR obligations. 2. 0 Development of CSR during Modern Times: During the first phase advertisements and the so called CSR reports were developed. The environmental report submitted by Abt & Associates in 1972 was the first of its kind. Though very limited in the scope in mentioning about air and water pollution this report pioneered the reporting on CSR.

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A further development was witnessed with the appointment of a social auditor by Ben& Jerry’s for preparing a CSR report on the activities of the company for the year 1988. “B&J prepared the Stakeholders Report with the social auditor’s input and the social auditor then appended a “Report of Independent Social Auditor” and signed it, saying it was his “opinion that the Stakeholders Report fairly describes the performance of the company in the area of social responsibility for the year 1988 with respect to the five stakeholder groups”. (Alice and John Tepper Marlin 2003)

The third phase of CSR was seen a little bit stronger in its approach with the pre determination of the standards and the audit procedures. The formation of the International Social and Environmental Accreditation and Labeling (ISEAL) was considered to be a significant move since the body merged in itself the standard setting and accreditation bodies. The fourth phase made the CSR more mandatory on the part of the companies with the passing of various legislations like Sarbenes-Oxley Act 2002 which comprised of penal provisions for any unlawful behaviour.

The formation of the millennium goals and the prescription of standards for human rights, labour standards, environmental aspects and anti-corruption marked the fifth and the current phase of the development of CSR. The formation of various human rights norms by the United Nations and the setting of the labour standards by the International Labour Organisation greatly facilitated the development of CSR principles. 3. 0 Global Standards for CSR:

The commonly adopted international standards like Global Compact, ILO Conventions, OECD Guidelines, ISO 14000 standards, SA 8000 standards, AA 1000, World Business Council for Sustainable Development and Global Reporting Initiative have made the fulfilling the CSR obligations by companies more elaborate and at the same time easier. These standards are aided by various legislations and market indices for the companies to know and discharge their responsibilities fully. This has resulted in the formulation of the definitions that fully describe the expectations from the corporate citizens in the direction of CSR.

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