An Empirical Investigation of Managerial Perceptions in Indian Organisations Regarding CSR After Legislation of CSR in India

Abstract

Purpose - India is a country which has assured by mandating CSR through its legislative action. Enactment of Companies Act, 2013 by the Ministry of Corporate Affairs, Government of India was one of the world's largest experiments of introducing the CSR as a mandatory provision by imposing statutory obligation on Companies to take up CSR projects towards social welfare activities. This has made India the only country which has regulated and mandated CSR for some select categories of companies registered under the Act. The main purpose of this research is to investigate the perceptions of CSR managers towards corporate social responsibility (CSR) after its legislation in India.

Design/methodology/approach - This paper reviewed the relevant literature of CSR. Through structured questionnaires and in-depth interviews with Indian companies, this study analysed perceptions of CSR managers towards CSR. Out of the top 1000 companies in India, 250 companies were selected randomly (using systematic random sampling technique). Since the respondents were concern CSR officers of that particular company so respondents found it easy to respond upon our questionnaire. Out of 250 companies, we were able to get response from 163 companies (response rate 65.2%). Collected data was analysed using SPSS and Microsoft Excel software packages.

Findings – This study provides an excellent empirical investigation into corporate social responsibility arena regarding attitude of Indian organisations. The investigated Indian organisations represent highly responsible behaviour towards society. CSR is an important issue in recent years. This research also uncovered the business factors motivating firms to be involved in CSR. The research presented here reaffirms that CSR is complex in nature because analysis indicates a great deal of diversity in managerial perceptions regarding CSR. This diversity in managerial perceptions regarding CSR can be a source of development, innovation, learning and growth. The modern and classical views to CSR are becoming increasingly prevalent amongst Indian CSR organisations. Therefor this research majorly revealed a change in attitudes of Indian organisation regarding CSR from traditional philanthropic view to modern and classical views. This study also highlighted increased believe about CSR benefits, better brand image, better reputation and value addition to business which demands integration of CSR into main business strategy geared up towards generating long lasting values for business. It is essential for organisations to engage in social initiatives so that they can create long-term benefits for both the community and the company. Therefor this research majorly revealed a change in attitudes of Indian organisation regarding CSR from traditional philanthropic view to modern and classical views. The Indian organisations have recognised the challenges and opportunities that are being placed upon them by the way of clause 135 of the Indian Companies Act 2013. These organisations have embraced a variety of approaches to response these challenges and opportunities mentioned in Company Bill Act 2013.

Research/limitations/implications - The survey is based on the perceptions of the senior executives handling CSR affairs of companies and not from other departments to get more accurate perceptions towards CSR. It is important to note that there is not always a clear link between managerial perceptions and corporate practices. Conclusions on the organisational level cannot automatically be derived from the managers’ understanding of the organisation and the business environment. The sample size (N=163) restricts generalisation of the results, however the response rate is very good (65.2%). Further this study is not sector or industry specific. Moreover, a number of background variables like age, gender, tenure, education, functional background, religion, personal characteristics, interpersonal relationships, and the structural environment etc. are likely to affect the managerial perceptions, which are not considered in this study.

Practical implications - This research provides valuable insights on attitudes of CSR managers of Indian organisations towards CSR. The Indian organisations are highly social responsible organisations but there are still some of the organisations who believe that CSR is a highly cost incurred initiative. This research is will be very insightful for this type of organisations to help them changing their perceptions. This study may encourage corporations to engage more in CSR. Since the majority of respondents in this study agree to a great extent that CSR can bring economic benefits to corporations, it may encourage corporations which do not engage in CSR to consider integrating CSR into their business strategies.

Originality/value - Being among the first research studies of its kind to examine attitudes of CSR managers in Indian organisations towards CSR, this study provides invaluable insights for Indian business community and also to academia in the country to understand attitudes towards CSR in India after its mandatory compliance,

Keywords: Corporate Social Responsibility, CSR Manager, CSR Manager Perceptions, CSR Attitudes, CSR Practices, Community Welfare, Sustainability, Perceptions regarding CSR, Company Bill Act 2013 for CSR, Mandatory CSR, CSR in India