How companies can align CSR with brand and profit from good image

GN Bureau | August 31, 2015



The amount is going to be many times more than some of the states’ public debt and equivalent to many big welfare schemes of the government. And there is a real danger of Rs 25,000 crore being spent on non-priority sectors.

The Companies Act, 2013 was amended to bring CSR (corporate social responsibility) under section 135 of the act from April 1 last year. Companies falling in the ambit of the new rules were mandated to spend two percent of their net profit (average of last three years) on CSR activities. It is estimated that nearly Rs 25,000 crore could be spent by companies in CSR activities in the first year (2014-15) itself. Nearly 14,000 to 16,000 companies are likely to come under the ambit of the CSR legislation.

Earlier, the companies, both public and private, used to spend on activities that they considered as social commitment. But with the law there is a definite list of activities that the government considers as coming under the CSR.

Private companies would like to spend their budget for CSR on activities that will benefit their brand and the image of the company.

But at industry level there are very few who understand how to align CSR with the brand. However, those who have managed to bring brand and CSR together enjoy great levels of preference, loyalty, word of mouth recommendations and enhanced marketing effectiveness leading to higher profitability due to consumers' willingness to engage with them.

The companies should ask about the strategic direction of CSR? From the area of competence, what's the best can be done for society? A change in the rules should have led to some strategic questions on CSR in companies. However, various corporate are not asking relevant questions. 

The CSR should ideally be aligned with the business. This means using ingenuity to serve both society and business needs at the same time.

Companies that do CSR are seen as having character and strong values. Studies indicate that consumers trust brands that do CSR more than brands that don't.

Comments

 

Other News

Hydro engineering college to come up in Himachal

 Prime Minister Narendra Modi has laid the foundation stone of hydro engineering college at Bilaspur in Himachal Pradesh. The college, being set up by National Thermal Power Corporation (NTPC) and NHPC, will provide B Tech courses in mechanical, electrical, civil and computer science discipl

BHEL commissions 3MW solar plant in Dadra & Nagar Haveli

 Bharat Heavy Electricals Limited has commissioned a three Mega Watt solar photo voltaic power plant in Dadra and Nagar Haveli.  BHEL executed this project on a turnkey basis for Dadra and Nagar Haveli power distribution corporation limited at Velugam.   It

Back to the drawing board: Kejriwal

Time to go back to the drawing board, said Delhi chief minister and Aam Aadmi Party leader Arvind Kejriwal on Saturday, days after his party failed to make its mark in the Delhi civic elections.   In a message, Kejriwal said that in the last 2 days, I spoke to many vo

Grasp the nettle by taxing rich farmers

  The tax net needs to be expanded and the rich farmers must pay up their taxes. This week saw quite a bit of going back and forth over this prickly issue after Niti Aayog member Bibek Debroy batted for taxing agricultural income.   Niti Aayog vice chairman A

Attention to NTDs, dream of an equal, accessible internet and the struggles of CIC

  A giant yellow inflatable schistosomiasis worm, with ‘Making Schistory’ printed on it, floated on Lake Geneva, marking the five years since the London Declaration on neglected tropical diseases (NTDs). Though in 2015 about 1.59 billion people received treatment for at least

BBNL, BSNL to provide broadband connectivity to 1.3 lakh rural post offices

In order to provide broadband connectivity of BharatNet to post offices in rural areas, Bharat Broadband Network Limited (BBNL), department of posts and Bharat Sanchar Nigam Limited (BSNL) have signed a tripartite agreement.   The agreement is the first tri-partite MoU which



Video

शहीदों के लिए आगे आये आईएएस अफसर

Current Issue

Opinion

Facebook    Twitter    Google Plus    Linkedin    Subscribe Newsletter

Twitter