INTRODUCTION

Corporate social responsibility is the continuing commitment by business to achieve commercial

success in ways that honor ethical values, address legal issues and contribute to economic
development while improving the quality of the workforce and their families as well as the local
community and society at large. Indeed, the idea of social responsibility is not new to this age;
rather it has been around as long as businesses have existed. Sometimes it comes in the shape of
caring owners who provided housing, paid the workers who are off due to sickness or otherwise
in form of attempts made to provide ease and comfort to the employees lot. Although many such
voluntary social measures have become legal requirements, a number of business leaders have
gone further ahead by utilizing their wealth to improve the living conditions of many people in
the society. Simultaneously, a shift is already occurring from traditional philanthropy to
wholesome community development among the more progressive of the companies. Financial
System is the most important institutional and functional vehicle for economic transformation of
any country. Banking sector is reckoned as a hub and barometer of the financial system. As a
pillar of the economy, this sector plays a predominant role in the economic development of the
country. Thus the banking sector has been playing a significant role as growth facilitator. In
recent years corporate social responsibility has become an important issue at global level. The
concept of corporate social responsibility recognizes as commitment of an organization to
operate in a socially responsible manner. It takes into consideration the social and environmental
implications of corporate financial decisions. It is also associated with corporate governance and
ethical business procedure.
Experts have defined CSR as A concept whereby a company indulges in continuous,
responsible activities that point to its good intentions as a corporate citizen
A renowned social responsibility analyst in the UK, Malin Baker states that CSR is about how
companies manage the business processes to produce an overall positive effect on society
The World business counsel for sustainable development notes that CSR is the continuing
commitment by business to behave ethically and contribute to economic development while
improving the quality of life of the workforce and their families as well as of the local
community and society at large.

Definitions

"Act" means the Companies Act, 2013

"Corporate Social Responsibility (CSR)" means and includes but is not limited to
a) Projects or programmes relating to activities specified in Schedule VII to the Act or
b) Projects or programs relating to activities undertaken by the board of directors of a Company in
pursuance of recommendations of the CSR Committee of the Board as per declared CSR policy
of the company subject to the condition that such policy will cover subjects enumerated in
Schedule VII of the Act.

"CSR Committee" means the Corporate Social Responsibility Committee of the Board referred
to in section 135 of the Act.
"CSR Policy" relates to the CSR outlook of the Company and the activities to be undertaken by
the company as specified in Schedule VII to the Act and the expenditure thereon, excluding
activities undertaken in pursuance of normal course of business of a company.
"Net profit" means the net profit of a company as per its financial statement prepared in
accordance with the applicable provisions of the Act, but shall not include the following,
namely:a) any profit arising from any overseas branch or branches of the company, whether operated as a
separate company or otherwise; and
b) any dividend received from other companies in India, which are covered under and complying
with the provisions of section 135 of the Act:

Provided that net profit in respect of a financial year for which the relevant financial statements
were prepared in accordance with the provisions of the Companies Act, 1956, (1 of 1956) shall
not be required to be re-calculated in accordance with the provisions of the Act.

NEED FOR CSR

CSR is a concept whereby companies decide voluntarily to contribute to a better society and a
cleaner environment. It is represented by the contributions undertaken by companies to society
through its business activities and its social investment. CSR has been making an increasingly
prominent impact in the Indian social system by supplementing development projects. But it is
not a novel concept in India as its historical roots goes till the Vedic age. Today Insurance Sector
growing larger and powerful than before. Various Non-government organizations put pressure on
them to act responsibly towards their stakeholders. Thus pressure has given rise to the concept
named Corporate Social Responsibility. CSR defined as the economic, legal, ethical, and
philanthropic expectations placed on organizations by society at a given point in time. (Carrol
and Buchholtz, 2000:35). Exactly what responsibility companies have towards society has been
discussed for some decades now. A fundamental model which could be argued to reflect the
outcome of this discussion is Carrolls (1991) four-part model in figure 1.

CSR is now an integral part of functioning of an organisation. The performance of an

organisation should be judged beyond the financial parameters. The authorities need not only
focus on the financial performance but to examine into the CSR performance of the organisation.

Economic responsibilities: The first responsibility of the company towards society refers to
running the business as an economically healthy unit. It includes aspects such as return on
investment for shareholders, fair employee salaries, and quality products supplied to customers at
fair prices; all required by the society. (Crane &Matten, 2004)

Legal responsibilities: Demands that companies act in accordance with existing legislation
and regulatory requirements. The legal framework consequentially fosters societys ethical view
and all companies attempting to be socially responsible are therefore required by society to
follow the law. (Crane &Matten, 2004)

Ethical responsibilities: It refers to corporations responsibilities which are not covered by

legal or economical requirements, but instead by what could be considered as right or fair in the
eyes of society. Society therefore expects corporations to act ethically towards their stakeholders.
(Crane & Matten, 2004)

Philanthropic responsibilities: This involves corporation`s willingness to enhance the

quality of living for their stakeholders (i.e. employees, local community, and society at large)
through charitable donations and organizational support. These corporate decisions are entirely
voluntary, of less importance than the former three, and (with regards to social responsibility)
only seen as desired by society. (Crane & Matten, 2004).

CSR Norms in India

The government on Thursday, 28th Feb 2014 notified the much-awaited provisions mandating
companies to plough back at least 2 per cent of their net profit on upliftment of the society. The
ministry of corporate affairs (MCA) has notified Section 135 and Schedule VII of the Companies
Act, 2013, which relate to corporate social responsibility (CSR) that will be effective from April
1, as part of the new Companies Act. The norms will apply to companies with at least Rs 5crore
net profit or Rs 1,000crore turnover or Rs 500crore net worth. These companies will have to
spend 2 per cent of their three-year average annual net profit on CSR activities in each financial
year, starting from FY15. The rules have been finalised after extensive consultations with all
stakeholders and provide for the manner in which CSR committee shall formulate and monitor
the CSR policy, manner of undertaking CSR activities, role of the board of directors therein and
format of disclosure of such activities in the boards report, said an official statement by Sachin
Pilot, minister of corporate affairs. According to the norms, the CSR activities will have to be
within India, but will apply to foreign companies registered in the country. The ministry, which
has also listed out permissible activities, said companies will need to take approval from their
board for CSR activities in accordance with its CSR policy and the decision of its CSR
committee. While activities such as donating funds to political parties or spends to benefit own
employees and their families will not be counted as a companys CSR, the government said that
activities such as promoting preventive health care and sanitation, setting up homes and hostels
for women and orphans and livelihood enhancement projects would qualify. To decide if a
company is eligible for mandatory CSR spending, its profit from overseas branches and dividend
received from other companies in India will be excluded from the net profit criteria. A company
can also carry out CSR works through a registered trust or society or a separate company, but
they can only spend up to 5 per cent of total CSR expenditure on manpower in a single financial
year. This would be applicable for own personnel as well as those of their implementing
agencies. The ministry had, late last year, issued draft rules for CSR activities by India Inc and
had sought public comments. Welcoming the final norms, experts said that companies will now
have to gear up to implement their CSR programmes under the final rules that will be effective in
just a month.

CSR Policy requirements as per the Companies Act, and notified Rules
It may be noted that the term CSR Policy as used in the Act and the Rules notified on February
27, 2014 requires the following to be included:

a) A list of CSR projects or programs which a company plans to undertake falling within the
purview of Schedule VII of the Act, specifying modalities of execution of such projects and
programs and implementation schedules for the same; and

b) Monitoring process for such programs provided that the CSR activities shall not include the
activities undertaken in pursuance of normal course of business of the company.
The surplus arising out of CSR projects or programs or activities shall not for a part of the
business profits of a company.

Major Areas for CSR

Following are the major areas the banks need to focus on for acting as socially responsible:-

CSR AND PROJECT FINANCE:- How to balance the risk and interest of the various
participating parties including protecting the interest of those who are directly or
indirectly affected- specifically the local community that reside within or close to the
area impacted by the project. This means that before funding a particular project they
should analyze the project to assess the social and environmental harm that can be
caused by its activities. They should also verify the credit worthiness of the borrower so
that the stake holders are protected.

COMMUNITY INVOLMENT:- This includes sponsorship of young entrepreneurs,

giving academic scholarships, taking part in re-cycling and waste management, health
support programs, financial support for art and culture, supporting NGOs engaged in
drug-prevention measures for the youth etc.

AWARENESS AND TRANSPARENCY:- Dedicating sections of annual reports to

CSR matters, publishing sustainability reports on CSR and web-based information

ENVIORNMENT:- By limiting the consumption of energy and paper, ensuring good

waste management and encouraging the clients to adopt low-carbon emission practices

CSR-Core Thrust Areas

The insurance sector brings a number of positive contributions to society: by its very
existence, the insurance mechanism is beneficial in many respects, and most companies are
concerned with risk reduction and prevention. Moreover, insurance companies increasingly tend
to be concerned with responsibility issues. In this, they follow the example of a number of
multinationals worldwide, which have now become familiar with the notions of sustainable
development, corporate social responsibility, or triple bottom line. Over the past few years, a
group of pioneering insurance companies such as LIC, SUN Life Insurance, Bajaj Life
Insurance, MAX Life Insurance, EXIDE, AGF, Allianz, Aviva, AXA, the Co-operative Insurance
Society, Friends Provident, ING Group, the Insurance Australia Group, Lloyds TSB, Prudential,
the Royal Bank of Scotland Group, Storebrand and Swiss Re, has developed new policies in
order to address mounting challenges in important areas. They have undertaken community
involvement programs; they strive to integrate the environmental concern, both internally and
externally; and they also show a growing interest for socially responsible investment. Besides, the
insurance industry generates indirect positive effects on the functioning of the economic system:
firstly, because it tackles the factors of insecurity which would otherwise lead agents to adopt a
more cautious behavior; secondly, because it reduces the number of legal actions that would
otherwise take place; and thirdly, because it alleviates the need for regulation in a vast number of
areas.

However, on closer inspection, it appears that the image of the insurance industry in the
public opinion is not so good. In reality, it appears to be blurred, if not squarely bad. A number
of reasons account for this negative perception: the opacity of the insurance business with its
misrepresentation and mis-selling practices, the dissatisfaction about the insurance agents'
reward system, the problems associated with the respect of customers' privacy, and the dilemmas
related to the consequences of outsourcing decisions, count among the major determinants of the
bad image conveyed by the industry. Moreover, its reputation has been further tarnished by
corporate scandals such as the recent AIG affair, where the CEO had institutionalized
wrongdoings in his company for decades.

Advantages of CSR
It is becoming increasingly important for companies to be good corporate citizens. Society has
started to demand it. Consumers believe that increasing the transparency of business practices,
and demonstrating positive social and environmental impacts are the two most effective actions
companies can take to improve public trust in the private sector, according to the State of
Sustainable Business Poll 2011, a survey conducted by sustainability consultant firms BSR and
Globescan.
Despite the apparent recognition of its benefits, corporate social responsibility (CSR) is still only
an emerging phenomenon in the Australian market. Companies remain skeptical of the idea and
its purported benefits. The resistance may be, in part, because of Australias operation as a
welfare state, where the onus is on government to provide basic social needs. It may also be due,
in part, to the economic uncertainty following the financial crisis.
Corporations are justifiably uneasy about spending to implement socially responsible
mechanisms when the benefits are not always quantifiable and may only be apparent in the long
term. However, in light of the litany of corporate scandals in recent decades, it is difficult to
maintain the view that organizations are under no obligation to consider the broader social,
environmental and economic interests of all stakeholders.
Reputational damage is but one consequence if a company fails to appreciate the importance of
its stakeholders interests. Take, for instance, the infamous Australian example of James Hardie
Industries, which continued to manufacture and sell asbestos products even after becoming
aware of the dangers. KPMG has estimated the total compensation costs at more than AU$3
billion, on top of the immeasurable social costs borne by the community.
The insurance industry has also seen its reputation tarnished by scandal. AIG was accused of bid
rigging, accepting contingent commissions and reporting misleading financial figures. The
Equitable Life scandal in Great Britain caused thousands of policyholders who invested in
annuities to lose billions. And in Australia, there was the collapse of HIH Insurance, a failure
caused by underpricing, reserve problems, false reports, reckless management, incompetence,
fraud and greed. By the end of June 2003, the government-funded HIH Claims Support Scheme
had paid out close to AU$245 million in claims.

Cases like these have left the impression that unethical behavior is characteristic of the industry.
Unfavorable media coverage has shaken stakeholder confidence and raised suspicion.
The insurance industrys reputation suffered a setback from the global financial crisis. Although
most insurers were relatively unscathed compared to the banking sector, some leading insurers,
such as AIG, Fortis (a Belgian insurance group) and Argenta (a Lloyds of London syndicate),
were let down by their non-insurance operations. Despite the performance of the industry on the
whole, trust in insurers deteriorated.
The increased occurrence of natural disasters has also presented a social challenge for insurers.
Australia is highly exposed to natural disasters, and following the Queensland floods in 2010 and
2011, public leaders asked insurers to extend their compassion to victims. But with numerous
insurers not offering flood coverage, many policyholders were forced to turn to the government
for assistance when their policies did not respond.
During a crisis, an insurer needs to demonstrate that it is more than just a profit-generating,
abstract entity. It is important for insurers to emphasize the vital role they play in economic and
societal development. CSR measures implemented in good timesand in badwill improve the
industrys reputation and reinforce stakeholder relationships. These two outcomes, in turn, can
increase loyalty, sales and resilience.
Steps to Achieving Corporate Social Responsibility
When formulating CSR best practices, insurers should consider customers, employees,
shareholders, intermediaries, suppliers, regulators and the broader community. The interests of
these stakeholders are vast, and insurers should focus on those that are affected by, or align with,
their business operations.
There are many potential benefits. Insurers can earn a superior reputation in the market. They
can increase engagement and loyalty among staff while reducing turnover rates. CSR can also
increase long-term sustainability and profitability by shaping the markets competitive
environment and the community as a whole. Ultimately, it will result in insurers becoming more
attractive to investors, who are increasingly concerned about CSR and corporate governance.

1. Paying Valid Claims Efficiently

Paying valid claims efficiently sounds simple, but it involves more than the obvious. Having the
right technology is essential, as is staff training. Insurers also need to price risks accurately and
fairly. If risks are continually underpriced, an insurer will go out of business, which will have
wide-ranging effects on all stakeholders (as demonstrated by the HIH collapse). On the other
hand, if risks are overpriced, customers may not be able to afford adequate coverageand may
choose not to insure at all. If most businesses and individuals choose to bear the risk of a loss
that they cannot afford to cover, this will have real implications for the economy, as well as
individuals health and safety. It would also place an unbearable burden on the government to
serve as a safety net.
To pay valid claims efficiently, insurers must also keep down costs. Premiums are calculated by
account for both the particular risks and operating costs required to provide the policy. It is
therefore important to minimize overhead, infrastructure and claims-processing costs so that
insurers can offer affordable insurance. There is, however, a fine line between insurers being
adequately resourced and providing appropriately priced insurance and insurers being under
resourced, leading to cheaper insurancebut poor service, long delays and higher claims costs.
2. Risk Minimization/Loss Control
Money can never entirely repair damage. Therefore, calculating the probability of loss and its
likely costs is not, by itself, good practice. Insurers are in the business of risk analysis. They are
the ones best positioned to minimize risksboth internally in their operations and externally for
their clients and other stakeholders.
Internal risk minimization could be as simple as implementing proper policies and procedures,
such as occupational health and safety guidelines. External risk minimization may be more
difficult to employ. Insurers should, however, attempt to do so in any circumstances over which
they have some control. Appropriate strategic CSR measures used to reduce risk externally will
depend on the type of products offered by an insurer. In general, insurers should train
underwriters to look more closely at clients internal decision-making processes, risk
management procedures and ethics.

Underwriting for large, risky projects or companies should entail in-depth research on the likely
sources of risk as well as more extensive screening and monitoring. Further, insurers should be
proactive in stipulating limits or requirements around insurance for projects that may impact
human rights. One example is insurance policies for pipeline projects in countries where the
exploitation of natural resources has fueled corruption, social unrest, conflict and abuses.
External risk minimization should reduce claims costs and frequency for clients, and insureds
will thus be incentivized to reduce the likelihood and severity of loss in order to lower their
premiums. Insurers should, and often do, consider offering discounted premiums to insureds that
take preventative measures. For example, discounts are offered to households that install security
systems, young drivers who take safety courses and life insureds who do not smoke.
3. Climate Change Leadership
For insurers, a big part of risk minimization involves the environment, as insurers have an
inherent interest in ensuring their clients are equipped to deal with natural disasters and the
effects of climate change. The United Nations Environmental Program Finance Initiative is a
collaborative effort of more than 200 companies in the financial services sector to identify,
define and promote good and best environmental practice in the industry. While some criticize
its lack of enforcement powers, the initiative plays an important role in fostering international
dialogue. Insurers should support the work of the program, and those like it, if they want to
strengthen their position as pioneers of CSR and stay in reach of their most advanced
competitors.
With climate change already impacting the industryincreasing the number of natural disasters,
altering claims trends, prompting a need for novel underwriting skills, escalating business costs,
spurring new regulations and altering the investment environmentmany insurers have focused
their CSR strategies on reducing their environmental footprint.
In 2006, for example, Aviva, a European company, became the first insurer to carbon
neutralize its operations. Its program focuses on reducing energy consumption, paper use and
business travel while capitalizing on energy-efficient property management, waste management
and carbon offsetting. The companys approach to carbon offsetting is particularly noteworthy.
Not only has Aviva approached carbon brokers to buy carbon credits, but it has also introduced

innovative social and commercial projects to offset carbon emissions. For example, the company
is supporting a World Food Organization project in sub-Saharan Africa to slow deforestation that
replaces open fires with energy-efficient stoves.
Some insurers are also helping customers reduce their energy consumption. For example if
customers homes are 80% damaged by a weather-related event, Suncorp and GIO offer them up
to AU$2,500 to pay for rainwater storage or solar power. They also have a policy of providing
replacement household products that have a minimum three-star energy-efficiency rating.
4. Strategic Philanthropy
Strategic philanthropy involves partnering with charities or organizations in the community for a
mutually beneficial purpose. This type of corporate giving can not only impact the community
but also other stakeholders in the business.
For instance, QBE has set up a foundation that aims to drive employee engagement. Through the
program, employees are able to apply for local grants for charities that they personally support.
Employees can also get involved in the community through paid volunteer leave, and the
foundation has promised to match employees charitable contributions and fundraising efforts.
Another form of philanthropy relevant for insurers is disaster relief. Following the recent
Queensland floods, for example, Suncorp donated AU$100,000 to the Queensland premiers
disaster relief appeal and set up customer response teams in remote locations to assist as many
customers as it could. Further, Suncorp provided employees affected by the floods with a range
of services including professional counseling, financial recovery packages and hardship grants.
There are many other projects insurers could support that are a form of strategic philanthropy.
Those that decrease crime or improve safety are particularly valuable, as they not only support
the participants but create safer communities, which have lower claims costs than dangerous
areas.

Mission Australia initiated such a program to deter young people from South Pacific Island
backgrounds from committing criminal behavior in Sydneys southwest, an area known for its
high number of insurance claims relating to theft. Independent analysis demonstrated that the
program reduced crime rates amongst participants, and 65% of participants had not reoffended in
the 12 months following completion of the program.
IAG has done something similar. The company focused its strategic philanthropy on a
partnership with St. John Ambulance to help stakeholders improve their safety and reduce
injuries.
5. Recognition for Human Rights
Studies show that few companies have taken steps to implement human rights policies. Such
mechanisms are often overlooked by companies that either do not see their importancebecause
they consider the protections afforded in the countries in which they operate to be sufficientor
specifically want to take advantage of the lack of protections provided by these countries.
Companies that show enthusiasm for observing voluntary human rights codes of conduct usually
operate in a business with the potential to considerably impact human rights; the majority of their
work may be done in developing countries, for example. These companies also tend to have
high-profile brand names that they wish to protect, and for that reason they can be more easily
pressured into action by civil society.
The insurance industry doesnt meet this classification, but human rights are still an important
consideration because insurance permeates many facets of everyday life. It is particularly
relevant for corporations operating globally or those that may be considering outsourcing (or
moving) services to countries with lesser human rights protections.
Many organizations have created initiatives to encourage companies to respect human rights and
hold corporations liable for violations. One of the most notable is the U.N. Guiding Principles
on Business and Human Rights, developed by Harvard professor John Ruggie and endorsed by
the United Nations in June 2011.

These principles provide a useful reference for insurers. Ruggie explains that to respect rights
essentially means not to infringe on the rights of othersput simply, to do no harm. The key
operational element is to conduct due diligence to become aware of, prevent and address
adverse human rights impacts. This process involves making policy commitments to human
rights, undertaking periodic assessments on the actual and potential impact of business
operations on human rights, integrating the process into decision making and the tracking of
performance. The principles also recommend that corporations develop a means to hold
themselves accountable and to provide for remediation through grievance or other mechanisms.
The concern about the lack of international legal remedies available for corporations human
rights abuses is on the rise. Following the U.S. Supreme Courts recent, controversial decision
in Kiobel v. Royal Dutch Petroleuma ruling that has rendered the Alien Tort Statute incapable
of providing a means for justice for foreign victimssuch concerns will presumably now be at
the forefront of human rights discourse. Engaging in voluntary measures that afford some
protection from human rights abuses now will help to diminish the demand for increased
regulation in this area in the future.
6. Socially Responsible Investment
Socially responsible investment describes the process of including non-financial criteria
environmental, social and governance considerationsin decision making. Institutional
investors, such as insurers, are in a powerful position in that they are able to encourage positive
change in investment strategies.
Traditionally, institutional investors have affected the market by investigating how investment
firm boards manage risk, analyzing reporting methods and occasionally recommending corporate
governance changes. With issues such as global warming, child labor and other human rights
violations becoming more prominent in investors minds, however, innovative companies
understand that corporations that knowingly ignore social and environmental influences do so at
their own risk. They may face complaints, litigation, tarnished reputationsor see their
opportunity to operate in important markets diminished.

A positive correlation between social, environmental and ethical issues, and long-term
shareholder value is a prerequisite for socially responsible investment to thrive. Studies have
shown that it does not compromise financial gains. Indeed, some studies show a positive
relationship between CSR and financial performance. Institutional investors, including some
insurers, are recognizing that non-financial factors are appropriate considerations when it comes
to investing.
There are three main strategies that socially responsible investors can use. The first, called
screening, involves selecting investment options based on social or environmental criteria. It
makes sense for insurers to screen out companies that, by the very nature of their operations,
increase the likelihood and costs of claims, such as tobacco companies. The second strategy,
shareholder activism, as its name suggests, involves communication with the investment
company through shareholder resolutions, for example. If measures of communication are
unsuccessful, then investors can always make their position clear by ceasing to invest in that
company. The third strategy, community investing, is self-explanatory.
For example, Aviva has insured 450,000 underprivileged people in India who would otherwise
not be able to take part in productive activities. Obviously, financial returns for this type of
investing are likely to be relatively low; however, taking part in community investing may create
new opportunities for an insurer while also improving its standing as a socially responsible
corporation.

CSR POLICIES AND ACTIVITIES/INITIATIVES BY INSURANCE

SECTOR
HDFC Life Insurance
HDFC Life has always believed that establishing a strong and ethical foundation is an essential
prerequisite for long-term sustainable growth. Integrity and people care are two of our key
fundamental values which we follow. For us, Corporate Responsibility comes first.
Our Approach
HDFC Life has always believed that establishing a strong and ethical foundation is an essential
prerequisite for long-term sustainable growth. HDFC Life focuses on maintaining the quality of
business and creation of long-term value for policy holders and stakeholders. We also believe
that business must go hand in hand with a sense of responsibility towards the society.
HDFC Lifes business philosophy highlights the theme of self-respect and independence.
Swabhimaan, HDFC Lifes Corporate Social Responsibility (CSR) initiative- aims to play a
positive role by contributing towards easing distress and aiding in advancement of society while
engaging with stakeholders thereby becoming a socially responsible corporate citizen.
HDFC Life is committed to being a socially responsible corporate and its CSR framework is
governed by a formal policy.
Corporate Social Responsibility Policy
HDFC Life CSR framework

Achievements Winner of Best Marketing Campaign awards for India Giving Challenge
2013Winner of Innovative Fundraising Campaign awards for India Giving Challenge
2013Runner up in Better than last year prizes for the India Giving Challenge 2013Won the 2nd
Best Marketing Campaign awards during the India Giving Challenge 2012Won the 2nd Best
Marketing Campaign and 2nd Most Innovative Fundraising Campaign awards during the India
Giving Challenge 2011HDFC Life was awarded the Yuva Hero Award in July 2011 for
contribution towards the educational support of lesser privileged childrenWon the Most
innovative fundraising campaign award during the India Giving Challenge 2010HDFC Life
was awarded with Yuva Unstoppable Corporate Icon Award from Dr. APJ Kalam in Sept2010

Initiatives
Rebuilding Uttarakhand: A Flood Response

In June 2013, devastating floods struck Uttarakhand. As a responsible corporate HDFC Life
decided to support rehabilitation of people affected in Uttarakhand floods
SOS childrens village project

HDFC life believes that education plays a significant role in an individuals life. It helps children
living on the margins of the society to break away from the cycle of poverty to a secure future.

Teach for India

HDFC Life believes in every childs right to quality education and believes that one of the long
term solutions to eradicate the Education inequality is by creating Change Leaders.
Payroll Giving

HDFC Life encourages its employees to contribute a small part of their salary to establish their
own charity account through the Payroll Giving programme.

Tree plantation

Environmental sustainability is emerging as an essential ingredient to doing business responsibly

and successfully.
Financial Literacy project

HDFC life believes in empowering marginalized population by building their capabilities. One
of the key capabilities is the ability to use knowledge and skills to manage financial resources
effectively for long term financial well-being.

Swabhimaan Careers

HDFC Life realizes that coping with the loss of a loved one is a painful experience. While the
disbursement of a death claim may help family members.
Akshaya Patra

HDFC life believes that education plays a significant role in a persons life. It helps marginalized
population of society in breaking away from the shackles of poverty.

EXIDE LIFE INSURANCE

Say No to Plastics
Exide Life Insurance is in the business of helping its customers manage their financial futures.
Like protection of life insurance is important to build a foundation for our family's financial
future, it is important for us as individuals to protect the environment that will lead to a safer and
better tomorrow.
Say No to Plastics is a very unique initiative from Exide Life Insurance that educates the citizens
of India on the negative effects of usage of plastics and encourages them to switch to
environment friendly materials.
Under this program, our teams have engaged with more than 100,000 households. Our teams go
door to door and during every interaction they handover "Kora Cloth" bags and make people take
a pledge towards this noble cause.
This program was recently recognized by Rural Marketing Association India through a Gold
Award in the Door To Door Marketing (Social) Category.
Exide Life Insurance thanks all those have already said no to plastics.

SBI Life Insurance - India

SBI Life undertakes its CSR initiatives with an objective to bring about effective change as a
Responsible Corporate Citizen.
Through various CSR initiatives, Company intends to ameliorate the conditions of the people
from the underprivileged sections of the society by facilitating them with education, adequate
health care services and contributing towards making their lives better.
1. Facilitate education for underprivileged children through the following initiatives:
Contributed towards the academic support of 1,200 underprivileged girls in Mumbai and 69
girls in Andhra Pradesh in partnership with Nanhi Kali. In addition to primary education, the
support includes Academic Support (Cost of Tutors, Training) and Material Support (Uniform,
Stationery and Notebooks).
Nanhi Kali, is a project jointly managed by KC Mahindra Education Trust and Naandi
Foundation was incepted in 1996.

Organized Project Unnati along with Smile Foundation and supported the educational needs of
25 young girls.

Smile Foundation is an Indian development agency registered as an Indian Charitable Trust in

2002, working for the holistic development of children, youths and women (in the areas of
education, health, girl child, empowerment and livelihood).

Contributed towards supporting the educational requirement of the children like note books,
stationary items from Adruta Foundation.
Adruta Foundation rehabilitates orphaned or deserted children in Odisha. It aims at becoming
the centre of excellence in providing food, clothing, education and holistic growth to destitute
children.

Contributed towards procuring school bags, water bottles, notebooks, pencils, erasers, crayon
boxes and white board for classroom teaching 125 children in UTSAH, Guwhati.

3
3

UTSAH (Universal Team for Social Action & Help) is a Child Protection Centre,
accommodating 125 students from the slum area under the Education Programme.

SBI Life Chandigarh office identified an orphanage for girls - Unique Homes for Girls,
Jalandhar. The office distributed a set of uniform, bags and shoes to 45 girls.

Unique Home is run by a trust named after Bhai Ghanayya Ji, a disciple of Guru Gobind Singh
SBI Life distributed books at Jaibai Choudhary School, New Colony, Sadar Nagpur.

2. Support towards Underprivileged Citizens:

SBI Life Kolkata donated 15 Wheel Chairs, 15 Ceiling Fans, 50 Plastic Chairs, and Medicines
for one month, 50Kgs Horlicks, Fruits, Biscuits, etc to Prem Daan a home for destitute run by
Missionaries of Charity.
Prem Daan is a home for destitute run by Missionaries of Charity, Kolkata with a mission of
serving underprivileged destitute brought from different part of the city. People with
psychological problems are treated and helped to return to normal life.

3. Towards Environmental Related Cause

SBI Life in association with GrowTrees.com plants a tree on the occasion of every employees
birthday. The trees are planted at various reforestation areas like Kanha National Park at Madhya

Pradesh, periphery of Satkosia Gorge Wildlife Sanctuary, Angul, Orissa etc and are maintained
at a high survival rate. In FY 2013-14, 8,763 trees were planted.
GrowTrees.com focuses on tree plantation as it creates low-skill jobs and trees provide benefit to
current and future generations, have a direct impact on carbon reduction, restoring forests,
improving wildlife habitats, and upgrading water catchment areas, offer flowers, fruit fodder and
fuel for local communities and all living creatures.

TRIPLE BOTTOM LINE AND CSR

The triple bottom line refers to a how a corporation deals with and reports on its impact and
behaviour in respect to people, planet and profit. It reflects to a corporations greater
transparency and accountability in its public reporting, communication and disclosure in regard
to how the corporate entity performs in environmental, social and economic dimensions While
there is no single universally accepted definition of TBL reporting, in a sentence it can be
defined as corporate communication with stakeholders that describes the companys approach to

managing economic, environmental and social dimensions of its activities. It is also known as
corporate social responsibility, though some prefer to use the word sustainability as more

encompassing, as they argue that responsibility emphasises the benefits to social groups outside
the business, whereas sustainability gives equal importance to the benefits enjoyed by the
corporation itself. Sustainable in this definition also refers to development that must not reduce
options open to future generations

However, responsibility and sustainability are both used to refer to a companys obligations to
society at large. The phrase ''corporate social responsibility'' (CSR) is used to describe why,
when, and how businesses manage their social, environmental, and economic aims and
performance. It is an expression of the belief that it is not enough for a company simply to profit
its owners. Rather, CSR holds that a company also must ensure that it does little or no harm to,
and preferably helps, its workers, the environment, and the communities in which it operates.

As such, CSR is a balancing act between the interests of a company's various ''stakeholders''
including shareowners, executives, employees, communities, and customers. It also is referred to
as ''good corporate citizenship'', ''compassionate capitalism'', and ''business ethics''. CSR has
evolved in diverse ways for different companies, industries, and societies. In the United States,
Latin America and Southeast Asia, for example, much CSR involves donations to social and
artistic causes and other such acts of corporate philanthropy. In Europe, where charity is
regarded as a peripheral aspect of corporate operations, debate about CSR has focused on the
environmental and social impact of companies' business functions.

The concept of the Triple bottom line was proposed by John Elkington, who suggests that
businesses need to measure their success not only by the traditional bottom line of financial
performance & profit, but also by their impact on the broader economy, the environment and on
the society in which they operate.In conducting their businesses, companies use not only
financial resources (investment dollars, sales revenues), but also environmental resources (water,
energy, raw materials) and social resources (employees time and talents, infrastructure provided
by govt agencies). His argument was that a sustainable business out to be able to measure,

document ad report a positive return on investment across all three bottom lines, as well as
showing the benefits that stakeholders receive along the same three dimensions.

Basically, triple bottom line (TBL) reporting is meant to capture, describe and measure the
impact of the organisations activities on the world. The triple bottom line exists as a kind of
balanced scorecard that captures in numbers and words the degree to which any company is or is
not creating value for its shareholders and society

Economic (profit)
Sales,

profits

return

Environmental (planet)
on Air Quality

Social (people)

Labour Practices

investment
Taxes paid

Water quality

Community Impacts

Monetary Flows

Energy usage

Human Rights

Jobs Created

Waste Produced

Product Responsibility

BENEFITS OF TRIPLE BOTTOM LINE

Enhancement of reputation and brand:Effective communication with stakeholders on one or more of TBL dimensions can play an
important role in managing stakeholder perceptions and so protect and enhance corporate
reputation (look what happened to wheat board shares).

Securing a social licence to operate:This is kind of like reputation, an informal community and stakeholder support for the
organizations operations communities are likely to be more supportive of companies that
communicate openly & honestly about their performance in relation to environ, social &
economic factors.

Attraction and retention of high calibre employees:The publication of TBL information can play a role in positioning an employer as an employer of
choice, which can enhance employee loyalty, reduce turnover attract knowledge/gold collar
workers.

Reduced risk profile:When TBL reporting takes place a company shows its commitment to minimising risk in times
of increasing litigation, where due diligence can be established and a company establishes risks,
they can be better managed. In turn, this improves stakeholder relations and makes it easier to
attract investment capital and therefore positively affect the share price.

Identification of potential cost savings:TBL reporting involves the collection, collation and analysis of data on resource and material
usage and the assessment of various processes. This can actually help a company to better
identify opportunities for cost savings through more efficient use of resources and materials

Increased scope for innovation:In the process of reporting on all aspects of TBL, a company may actually create new
innovations.
E.g.:- trying to use less water, invent a grey water recycler.

Creation of a sound basis for stakeholder dialogue:Publication of TBL reporting creates a platform for engaging in dialogue with stakeholders.
Understanding stakeholder requirements and aligning them with business performance is
fundamental to business success.

FUTURE SCENARIO OF CSR

We in India need to take hard look at ourselves. Compared to other countries our track record in
development is fair from satisfactory. A man may have a mobile phone, but does not have access
to clean drinking water, a toilet, healthcare or basic infrastructure like electricity or roads. The
poorest of the poor in the world live here even while malls are springing up everywhere. The
population stratification is the steepest in the world. In a country of more than 1.2b people, we
have a shortage of doctors, teachers, nurses, policeman, soldiers in fact of all skilled workmen.
The harsh reality of a high rate of malnutrition and infant mortality cannot be brushed under the
carpet or simply wished away. Above all, the complete breakdown of the value system has
brought the sense of mortality, ethics and social justice to an all time low.
Where is the disconnect? Is the environment conducive to growth and development? In a country
sixty six years (not young) there has been grave failure. However, it is not the time to fix
responsibility for the past, but it is time to take responsibility for the present.
What is India`s take on this? Are we waiting for policy change at the national level? Can we
remain myopic and unaffected, like a duck in water? I think there is an urgent call for Back to
Basics. We all have a role to play. Sustained growth has to be inclusive. Tipping of the balance
will result in disaster. Social and economic asymmetries cause imbalances leading to law and
order situations and even revolutions. Economic growth must be a nation, not in exclusion of the
people. The imbalances may not be obvious to some because of a large middle lass population
that lives in urban areas and is hopefully getting roti, kapda but this constitutes a minority of
the total population. With exposure to media they are also well aware of what they do not have
access to leading to frustration. There are some people in tribal areas who still eat rats to survive
and have no knowledge of electricity even today.
At a time when Corporate Social Responsibility is being projected as mandatory, it is the ideal
opportunity for corporate to establish priorities and work on their selected platform with
accountability and responsibility, focusing on areas where their efforts will result in nation
building.

There is a need for corporates to take on institutional responsibility and ownership in executing
CSR in the line of their business. It is simply a matter of looking and reaching outwards, out of
the circle the routine profit making cycle. This effort of reaching outwards inevitably widens
one`s reach and reaps gains for the company while bringing about positive changes in the
environment. Such positive change from different directions merges into direct Growth. CSR
is a Win-Win situation.
What are the pre-requisites that a company should imbibe before it`s CSR becomes a significant
entity?
A sense of collective responsibility
Accountability
An ability to see the larger picture; the larger good which will bring additional value to
the company.
A sense of nationalism; pride in the nation and its achievements. The ability to think as
an Indian.
Good Corporate Governance and Ethical practices which are also a part of Corporate
Responsibility. These must filter to the individual level.
Execution needs commitment, authenticating of partners and monitoring processes. Employee`s
engagement is important. Involvement and support from the top management is vital for the
success of CSR projects. Employees realize the importance of CSR initiatives to the company
when support from top management is visible. I have seen that those employees who engage in
CSR initiatives get involved and feel empowered by their personal ability to make a difference.
They feel proud to belong to an organization that does good work for the needy. They are
motivated and from a more committed work force.
Areas of work could be:
1. Healthcare
2. Education
3. Skills training
4. Building infrastructure
5. Environmental issues

Conclusion:
No doubt CSR is not the only solution. It is but a small cog in the engine of development;
however it is critical part. Without the corporates taking on the mantle of social responsibility
and aiding and pressurizing the government to do it bit, this engine could come to a grinding
halt.
The time to act is NOW.

BIBLIOGRAPHY
Schedule VII of Companies Act 2013
Global Journal For Research Analysis
Indian Journal Of Research
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