Corporate social responsibility should not be restricted to the mandatory 2 per cent spending, but to ensure that business run the ethical way, according to Arun Maira, Member Planning Commission.
"While it was good for corporations to think of philantrhropy, it is also important to ensure that the money used for the purpose comes from ethical means," he added, speaking at a CII conference on inclusive development and sustainability, titled 'Responsible Growth: A Business Imperative', in Mumbai.
Business leaders have a duty to ensure responsible growth, factoring sustainability and inclusive development, Maira said. Corporate citizens, buinesses mut be responsible for their behaviour and the consequences thereof.
Today, more corporate than any time before are beginning to realize that the growth does not merely encompass “balance-sheet” growth. The focus has shifted to what and how has the balance-sheet growth impacted the resources, environment and society at large.
Sustainability is becoming integral to business strategy; much more than a reporting issue. Organizations are beginning to recognize that the reporting of non-financial data is now expected and virtually a commonplace. How companies leverage sustainability related information to execute their business strategies truly sets them apart.
Additionally, actions by governments, customers, investors and innovators in response to concerns about sustainability & climate change are most visibly influencing the industry to re-orient their thinking both at the board room and operational level to a more responsible and inclusive growth. The risks associated with climate change and sustainability for most businesses can be classified into five categories: strategic, compliance, financial, reputation and operational. The need to manage and mitigate these risks is turning the focus lights on the value stream, which is being mapped and remapped to identify abatement levers.
In the recent past, in order to drive responsible growth, there has been a significant push for disclosure through National Voluntary Guidelines, formulated by Ministry of Corporate Affairs. With Companies Act, 2013, corporate social responsibility has gained significance at the board level.
Responsible business is a way of doing business that creates long-term shareholder value by embracing opportunities and managing risks deriving from economic, environmental and social developments. Innovation, efficiency and sustainability together are fundamental to responsible business. It is about creating shared value for both companies and society through collaboration between them. Businesses that create value for the society are creating long term strategic value for themselves too. It can reduce risks, lower costs, increase revenues, improve customer retention, enhance brand value and create a more sustainable business model. Thus, by being responsible, companies can grow their business while ensuring that their actions have positive implications on the community in terms of responsible growth.
As clean air, water, energy and supply chain continue to gain increased attention from legislators, regulators, investors, customers, media, and communities, it is poised to have a profound effect on businesses in the coming years. The risks and opportunities presented by climate change and environment will vary by industry and company, but virtually every business will be affected. That is why responsible growth matters to any business today.
The business climate around the world is witnessing an unprecedented change since globalization, more so in the last couple of years of global economic meltdown and political turbulence. The fast deteriorating environmental conditions in many countries, and the imminent threat of climate change is expected to throw businesses off their comfort zone, and only the ones that quickly come to grips with the core issues involved and ensure that their business operations are sustainable would stand to gain in the long run. Responsible business is not merely a "nice-to-do" thing, but has become a business imperative to stay on top. It is foreseen that environmental and social friendly business practices will be the future of the global market. With the Indian Government taking various steps and measures towards promoting the responsible business and creating new opportunities, it is a clear that embracing sustainability is the right way to go.
The 1st edition of the Conference, hosted by CII Western Region aims to take a fresh look in shaping and
leveraging the challenges faced by Industry in embracing the concept of Sustainability and pursuing its journey to strike a balance between economic growth and social and environmental concerns. The Conference will bring together eminent practitioners and thought leaders from the industry to share their
outlook on the following crucial perspectives that underpin the theme :
• Responsible Growth for Future: The policy solutions available for forging the responsible growth agenda, use of natural resources in an efficient and ‘evolved’ way so that it is sustainable as well as competitive; increased transparency; responsible role played by the country’s public sector and enhanced respect for international guidelines and principles.
• Responsible Growth and Environment – Need for new business planning : Solutions to “harvest” methods aimed at keeping environmental impact to the minimum with adequate control on consumption of energy and other natural resources, thus aiming for effective and sustainable solutions.
• Emerging Social Implications of Responsible Growth: Focus on fostering culture of Inclusivity of human and social elements to act as a force multiplier, and to bring about radical changes in the ecosystem. To consider responsible and sustainable sourcing as respect for the environment.
• Making a Business Case for Sustainability: Business decisions for companies aligned to best ecological decision. Considerations of ‘what we really care about’ and ‘who do we serve’ should be key drivers of sustainability.
You will get access to following Knowledge Resources by subscribing to the Digital
Library of this event.