Redefining CSR
The Indian government has framed several public policies to address the various social issues in the country. However, the government wants the corporate sector in India as well to get involved to a certain extent in the upliftment of the society. Indian Government’s Companies Bill 2012 expects pharmaceutical companies to spend two per cent of their net profit for the community. The companies on the government’s radar are those with a net worth of Rs 500 crores or turnover of Rs 1,000 crores or an average net profit of Rs five crores in the last three financial years. As several industry players are already very active in Corporate Social Responsibility (CSR), enforcing the clause of mandatorily spending two per cent of their profits has not gone down well with everyone. It has also raised several serious queries.
Should CSR be made voluntary?
 “The government is well-meaning in its endeavour to make CSR more of a compulsory social responsibility for corporates as opposed to corporate social responsibility which is voluntary in nature.”Ranjit Shahani Vice Chairman & Mng. Director, Novartis India |
According to Ranjit Shahani, Vice Chairman and Managing Director, Novartis India, the government’s intentions are good and everybody should do their share for the wellbeing of the society. However, he also points out that CSR should not be forced and it should come from organisation’s own drive or will. By forcing it, organisations will end up doing things just for the sake of doing them.
Shahani says, “Society has two kinds of norms, those that should and must be mandated and those that are better kept voluntary and self-regulated. The government is well-meaning in its endeavour to make CSR more of a compulsory social responsibility for corporates as opposed to corporate social responsibility which is voluntary in nature.” However he also adds, “CSR requires a human touch and this would be missing if it were to be mandated for then it will be reduced to a ticking of the box to ensure that it has been done. It would be better for companies to be actively encouraged to exercise their social responsibility. It is important for all stakeholders to come together to work for the overall good of society.”
Shahani insists that finally the primary responsibility for its people lies with the government.
As mentioned earlier, there are pharma companies who are already investing a considerable portion of their net profit for the CSR activities. Jubilant Life Sciences is one of them.
This company has been active in the area of CSR since the year 2007, much before the CSR Bill became an Act under the Companies Act 2013.
 “Today, CSR is way beyond philanthropy and is a much wider concept than before. It is no more about giving profit rather it is about responsibly sharing a portion of the company’s profit to bring inclusive growth.”Vivek Prakash General Manager, CSR, Jubilant Life Sciences |
Vivek Prakash, General Manager, CSR, Jubilant Life Sciences says, “As Jubilant’s engagement with the community goes back a long way, we welcome the government’s mandate for CSR spending by Indian companies as it constitutes in being a good corporate citizen. We are glad that our approach towards CSR is in alignment to the prerequisites as listed in the Companies Act 2013. Today, CSR is way beyond philanthropy and is a much wider concept than before. It is no more about giving profit rather it is about responsibly sharing a portion of the company’s profit to bring inclusive growth.”
Choice should be yours?
The pharma companies also feel that they should be allowed to support the CSR initiatives of their choice because then they can deploy their own skill sets and resources in the best possible way. Making companies toil on something that they do not have skills or resources for, would not lead to effective CSR. Infrastructure, different cultural values, work force, finances etc are some of the factors that should be taken into account before assigning CSR responsibility to the company. So, allowing companies to choose their own field of CSR may perhaps guarantee better CSR implementation.
Shahani says, “Why just pharma companies, all companies should be allowed to choose the area where they are best able to make a difference.”
 “There is no need to make compulsory what is already logical, and that meets the objectives of beneficiaries and the organisation.”Aparna Thomas Sr. Director- Communications (India & South Asia) & Public Affairs and Corporate Social Responsibility (India), Sanofi India |
Aparna Thomas, Senior Director- Communications (India & South Asia) & Public Affairs and Corporate Social Responsibility (India), Sanofi India feels, “In order to be effective, CSR must be integrated with the company’s business. The activities undertaken should be mutually beneficial for the business entity, its stakeholders and the community, for it to be sustainable and meaningful. As an integrated healthcare company, we have long engaged in multiple initiatives that are relevant to our business, our customers and stakeholders, and that testify to our deep-rooted sense of corporate responsibility.”
CSR focus: Narrowed or comprehensive?
For companies like Novartis, Jubilant Life Sciences or Sanofi India, CSR is nothing new. For last many years, these companies are voluntarily involved in the activities meant for society’s wellbeing. However, the government’s decision directs the corporate sector to focus on particular areas of socialdevelopment. Though areas specified by the government cover many important fields of development, many companies might be already working on social issues that are not mentioned in government’s directive.
| CSR initiatives by Novartis |
| Glivec International Patient Assistance Program (GIPAP): This program was set up by Novartis to provide access to Glivec to those patients suffering from CML or GIST. Currently 95 per cent of patients i.e. more than 16,500 patients prescribed Glivec receive it completely free of charge. Since inception of the programme in 2002, the company has so far distributed Glivec valued at more than $ 1.7 billion absolutely free of charge. |
| Novartis Comprehensive Leprosy Care Association set up by the Novartis Foundation for Sustainable Development in 1989 provides patients access to treatment and disability management and facilitates physical and social care. Novartis is committed to eliminating leprosy from the world through its donation to WHO of the drugs required to treat leprosy. India, with 70 per cent of the world’s cases of leprosy, is the largest beneficiary of these drugs. |
| The generics arm of Novartis, Sandoz, sponsors two Child Support Centres and a Vocational Training Centre as well as a Women’s Empowerment Centre near their facilities at Turbhe and Kalwe in association with the NGO Arambh. These centres have helped children who are otherwise used as child labour and also helped increase the employability of people from the surrounding slums. |
| The Indian School of Business scholarship: A yearly scholarship of Rs 12 lakhs is divided among three needy women students with excellent academic credentials coming from middleclass backgrounds. Novartis has been doing this for the last eight years. |
| Akanksha: For several years now Novartis has participated in the Standard Chartered marathon with the amount committed to an Akanksha centre for the education and health of underprivileged children. |
| Garden: Novartis agreed to develop and maintain a garden on a plot of land belonging to the Nehru Centre. The company spent ` 45 lakhs to develop the garden and is committed to maintaining it for a period of thirty years until 2031 and thereafter on mutually agreeable terms. This has provided succour to a greenery starved Mumbai and serves as a healthy lung to this concrete jungle. |
| The company believes it owes it to society to sensitise its own employees on areas related to Corporate Social Responsibility. Novartis Community Partnership Day is a worldwide initiative aimed at helping local communities in useful, practical ways, in social or environmental projects. It usually takes place around 23rd April, the date of the Ciba-Sandoz merger that marked the creation of Novartis. In India hundreds of employees are involved in community work over a whole week in April. |
So, what would be the fate of such endeavours and their beneficiaries? Would the companies have to put in more time, efforts and most importantly money for fulfilling the government’s mandate?
According to Shahani, much of the work that is being done by companies will continue and will in fact expand.
“Our approach is of a partnership and we are glad that when the CSR Bill was passed, we did not have to move out from any of our existing projects. The scope of activities, under the Act, is very elaborative and the areas where we have been focusing – health, education and livelihood are included in the list of Schedule VII of Section 135,” says Prakash.
Thomas opines, “Typically, companies in the healthcare business have CSR focus and activities in areas that are linked to health (e.g. education, awareness and screening) and their concerned stakeholders. Hence, there is no need to make compulsory what is already logical, and that meets the objectives of beneficiaries and the organisation.”
| CSR initiatives by Sanofi India |
| Community programmes |
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| Community partnerships |
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Expanding horizons
Pharma companies have never said no to CSR. Almost all of them justify the stand taken by the government, which is quite expected also. However, there are very few companies which have taken their CSR activities to the national level. If a company wants to earn profits by doing business all over India then the scope of their charity should also be across India. A large chunk of pharma companies have limited their CSR work around areas which are in the close vicinity of their manufacturing plants or corporate offices. Any kind of charity is welcomed, but such pharma companies should now spread their noble initiatives beyond their company locations.
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