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Benefits of capitalism are percolating down: Rajashree Birla
Calls for progressive capitalism at AIMA’s 9th Business Responsibility Summit

04 Aug 2022

Ms Rajashree Birla, Chairperson, Aditya Birla Centre for Community Initiatives and Rural Development says that progressive corporations are doing a lot to ensure that the benefits of capitalism percolate down. “We need to build a society that works for everyone,” she said while addressing AIMA’s 9th Business Responsibility Summit.

Ms Birla complimented AIMA for helping corporate leadership and executives understand the need for inclusive and sustainable growth through its persistent propagation of responsible management thinking and practices.

“Aditya Birla Group has a social vision embedded in the business vision,” Ms Birla said. She stressed that the group has received excellent return on its investment in CSR as measured in terms of the number of lives turned around.

CSR impact depends on the engagement of the top management, she insisted, and pointed out Birla family’s association with social and national good since the days of the group’s founder, Mr GD Birla, who first finance freedom struggle and later set up enterprises to make commodities that were most needed by the country. She said that her son, Mr Kumar Mangalam Birla set up Aditya Birla Centre for Community Initiatives and Rural Development for a bottom-up CSR.

The key to meaningful CSR is running it like a business with a razor-sharp strategy, clear milestones and performance management, according to Ms Birla. She said that Aditya Birla Group’s CSR projects have 1-year plans and 5-year plans and involve partnerships with the government, development agencies, and NGOs. “They help us get the bang for the buck,” she said.

Dr Bhaskar Chatterjee, the architect of the mandatory CSR in India and now CEO, Anil Agarwal Foundation (Vedanta Group) is the Advisor of the Business Responsibility Summit. He expressed satisfaction that since the introduction of mandatory CSR in April 2014 the mindset of corporate leadership has changed and company leaders no longer ask why they are being asked to spend on CSR, instead they are happy to be directly involved in development. “CSR has moved from the backroom to the boardroom,” he said.

Talking about Vedanta’s CSR efforts, Dr Chatterjee said that the group’s messaging across all company operations is that it works for the society and the nation.

Mr CK Ranganathan, President, All India Management Association & Chairman & Managing Director CavinKare Pvt Ltd highlighted the role played by mandatory CSR in tackling the covid crisis. He pointed out that because of the structures and systems put in place by companies to comply with CSR obligations, they could promptly respond to the crisis and by providing materials and equipment for saving lives. He pointed out that the funds for CSR compliance came in handy and in the first year of covid the CSR spending peaked at about Rs 25,000 crore. However, he also pointed out that the linkage of CSR spending to profit levels resulted in a sharp drop the next year due to the ensuing recession.

Mr Ranganathan also highlighted the transition of CSR towards ESG. He pointed out that the environmental, social and governance issues were becoming important for investors, consumers and politicians in the developed world and Indian companies needed to pay attention to attract their capital and access their markets. He also pointed to the millennials and the Gen-Z looking at companies’ ESG track record before buying their products or working for them. He referred to the SEBI’s addition of sustainability reporting requirement to the business responsibility reporting as a step towards adoption of ESG practices in India.

MS Rekha Sethi, Director General, AIMA stressed the importance of human and environment health in business conduct. She pointed out that the rules of commerce are turning against the polluter and the wasteful. “The environmental cost of doing business is beginning to be counted more seriously and companies need to watch their ways to avoid restrictions by governments and rejection by consumers,” she said.

The summit included the Project Excellence Contest with separate categories for PSU and the Private Sector with IOCL, NTPC, Coal India, Anil Aggarwal Foundation, Tata Long Products, Schneider and Bosch emerging as notable winners across categories.

The Business Responsibility Summit is being held online and is being addressed by distinguished business leaders and CSR experts from the private and the public sector. The summit is being livestreamed on AIMA’s social media channels.

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