WHY SOCIAL RESPONSIBILITY OF BUSINESS?

‘The business of business is business’ was the motto of businesspersons in early times. Narrowly
interpreted, it would mean that corporations have only one responsibility, the single –minded
pursuit of profit. To economist like Adam Smith and Milton Friedman, in a capitalist society
profit maximization by the continued increase of efficiency is the most socially responsible way
of conducting business. This implies making quick money, with utter disregard for the
responsibility of business towards society. This limited view of business would prove to be
counterproductive in the long run. But on the other hand, the long range view of business, which
would imply an am at the long term gains rather than at quick returns, would take into account
the important dimension of social responsibility.
The ethical and social behavior of corporations is essential for the generation of profit, owing its
source to the reputation the corporation would require in view of its social behavior. James
Burke, the ex -chairman of the well known consumer product and pharmaceutical company,
Johnson & Johnson said this: “I have long harbored the belief that the most successful
corporation in this country, the ones that have delivered outstanding results over a long period of
time, were driven by a simple moral imperative, namely serving the public in the broadest
possible sense better than their competitors”.
If we were to compete effectively in the global market, corporations must take a long, hard look
at their values, practices and assumptions. They need to question their accepted modes of
behavior, promulgating new values and set up new standards of conduct which are openly held
and shared within the corporation, while proclaimed to the outside world.
ACCOUNTABILITY TO SOCIETY
There is yet another reason why corporations should be conscious of their ‘social responsibility’.
In a democratic society any kind of enterprise exists for the sake of society. If private enterprises
is justified and allowed to exist it is because it is seen to contribute better than public enterprise
to the common good. It produces better goods and functions more efficiently, thanks to the
encouragement given to the individual initiatives. At the same time, private enterprise is not
encouraged because individuals may accumulate wealth for their own exclusive and selfish
benefit at the expense of the public.
Industries are allowed to exist because they are perceived by the public to be useful in the
attainment of the personal, social and material goals of the people. It is because of this ethical
perception that the employees of TISCO and the general public protested in 1977 when the then
Union Minister for Industry, George Fernandes attempted to nationalize TISCO. On the other
hand, when the public perceive that certain corporation do not function in the general interest of
the nation it does not object to their take –over by the government, as it happened in the
nationalization of the coal fields, the oil industry and the Indian Copper Corporation. Since
corporations exist for the sake of the public, they are accountable to the public and have a social
responsibility.
Tata Group has adopted a three-pronged approach to fulfill its corporate social responsibility
goals. In CSR, at the group level TATA Group focuses on three broad areas:
a) Volunteering.
b) Disaster response and
c) Group programmes.
Tata Group’s volunteering initiative, TATA ENGAGE, encourages Tata colleagues to connect
with society at large, to develop a deep understanding of their core purpose to improve the
quality of life of the communities they serve globally.
Tata Engage aims to institutionalize volunteering across the Group, in a manner whereby its
efforts are invested in areas where they are needed the most and planned such that the outcomes
are more fruitful and sustainable. Tata Engage has emerged as a vibrant platform that nurtures
and channelizes the volunteering spirit at Tata and amplifies outcomes by bringing together not
only Tata employees, but also their families and retired Tata employees. The platform connects
volunteers with causes close to their heart and helps build the institutional capacity of civil
society organizations. Volunteering opportunities range from three –hour experimental activities
during the Tata Volunteering Weeks designed to encourage and inspire Tata employees to
experience the joy of volunteering, to a six –month, part –time, skills-based project called
“ProEngage”. Tata Engage has delivered over a million volunteer hours last year, which places it
among the top 10 largest corporate volunteering programmes in the world.

The Tata group has long supported relief and response efforts during a humanitarian disaster. The
focus has been to deliver fast, effective support during a crisis; help build capacity and resilience
of communities for long-term rehabilitation; and foster the exchange of ideas that benefit group
companies to respond more effectively during disasters.
Recently under the aegis of the Tata Sustainability Group, a cadre of programme managers from
various group companies has been institutionalized to enable immediate technical assistance in
the aftermath of any disaster. A Disaster Response Guideline has also been framed and widely
disseminated. The State Disaster Management Teams meet quarterly to exchange information
and share good practices. In the last two years, the Tata group has provided relief to 400,000
affected families in India and Nepal.
In response to the devastation caused by the Earthquakes in Nepal in April 2015, Tata group set
up a Relief Unit to provide urgently needed humanitarian assistance to affected families. They
utilized a three pronged approach for faster dissemination of help:
1. Ensuring well-being through medical camps and trauma counseling.
2. Distributing relief kits consisting of hygiene kits, tents/tarpaulins, blankets and lanterns.
3. Providing temporary shelter keeping the monsoons in mind.
In Chennai 2015, incessant rainfall and inefficient management of flood waters had led to heavy
floods in Tamil Nadu since 1st December. The TATA group launched the TN Floods Response
Programme on 4th December by distributing food, emergency response kits, solar lamps,
initiating health & wellness interventions and setting up a community kitchen. The Response
covers worst affected communities in Chennai city, Thiruvallur, Kanchipuram and Cuddalore
districts.
Tata STRIVE, an initiative of Tata Community Initiatives Trust, and the first Group CSR
programme, addresses the pressing need of skilling India's youth for employment,
entrepreneurship and community enterprise.
It reaches to communities, develops skills of people from financially challenged backgrounds
and acclimatizes them with the changing work environment. The core philosophy is to create
courses that would help in creating and supplying trained manpower across the entire industrial
spectrum as well as develop entrepreneurial talent.