From time without beginning, businesses have generally been looked at with suspicion by politicians and general masses around the world. Even though they contribute to the growth of any country’s economy and become job creators, their intentions are more often than not considered dubious. There is some sort of self-inflicted stress on the part of companies to keep doing things to demonstrate their role as socially responsible entities, and not appear as just another money minting organisation. Yet, a lot of them don’t know how to create that balance.
Nonetheless, it is not a utopian dream for a company anymore to come across as socially responsible while at the same time, make profits on the way. Corporate social responsibility (CSR) if …show more content…
To explain further, let’s take the example of a clothing brand that employs fair trade practices in the way it sources raw material to get the clothes store ready. In the process, it will ensure safety and welfare of the artisans/labour employed. It will not indulge in unfair child labour practices. It will also determine how to minimize waste in its manufacturing operations by being cost-effective in resource utilization. If these activities start producing favourable economic results for the brand, it will be encouraged to further use the same strategy in the normal course of business. There you have it, a strategic CSR …show more content…
Since you are already doing everything to keep your costs under control by way of being environmentally and socially responsible, you can hope to sustain better than the rest.
Strategic CSR is naturally the way forward in the present scenario, but Section 135 of the Companies Act 2013 limits the scope for companies in India to do that. Any activity conducted as part of the normal business activity is not considered part of the CSR policy. As per the FAQs offered by the Institute of Chartered Accountants of India (ICAI), the CSR amount ‘needs to be appropriated unless otherwise its incurred by the company as part of its normal business activity which also qualifies for CSR activity, in which case, it will continue to be charged to P&L in the normal course’.
This ambiguity needs to be cleared and defined if the private sector is to unleash its true potential for the betterment of the society at large, as well as its own business
Nonetheless, it is not a utopian dream for a company anymore to come across as socially responsible while at the same time, make profits on the way. Corporate social responsibility (CSR) if …show more content…
To explain further, let’s take the example of a clothing brand that employs fair trade practices in the way it sources raw material to get the clothes store ready. In the process, it will ensure safety and welfare of the artisans/labour employed. It will not indulge in unfair child labour practices. It will also determine how to minimize waste in its manufacturing operations by being cost-effective in resource utilization. If these activities start producing favourable economic results for the brand, it will be encouraged to further use the same strategy in the normal course of business. There you have it, a strategic CSR …show more content…
Since you are already doing everything to keep your costs under control by way of being environmentally and socially responsible, you can hope to sustain better than the rest.
Strategic CSR is naturally the way forward in the present scenario, but Section 135 of the Companies Act 2013 limits the scope for companies in India to do that. Any activity conducted as part of the normal business activity is not considered part of the CSR policy. As per the FAQs offered by the Institute of Chartered Accountants of India (ICAI), the CSR amount ‘needs to be appropriated unless otherwise its incurred by the company as part of its normal business activity which also qualifies for CSR activity, in which case, it will continue to be charged to P&L in the normal course’.
This ambiguity needs to be cleared and defined if the private sector is to unleash its true potential for the betterment of the society at large, as well as its own business