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AN INDIAN PERSPECTIVE
Abstract:
This report mainly focuses on corporate social responsibility issues in
banking sectors and the involvement of Reserve Bank of India with other
member banks. The Reserve Bank of India is the central bank of India, and
was established on April 1, 1935 in accordance with the provisions of the
Reserve Bank of India Act, 1934.(1) The basic functions of the Reserve Bank is
to regulate the issue of bank notes and keeping of reserves with a view to
securing monetary stability in India and generally to operate the currency and
credit system of the country to its advantage. Its main objectives are
Regulation and supervision of the financial system, Managing of exchange
control, Issue of currency and some other functions like - Banker to the
Government: performs merchant banking function for the central and the state
governments; and Bank to Banks: maintains banking accounts of all scheduled
banks
“CSR is a concept whereby financial institutions not only consider their
profitability and growth, but also the interests of society and the environment
by taking responsibility for the impact of their activities on stakeholders,
employees, shareholders, customers, suppliers, and civil society represented
by NGOs. . The economic globalization resulted in a demand for corporations to
play a central role in efforts to eliminate poverty, achieve equitable and
accountable systems of governance and ensure environmental security. There
was a need to make business a part of society and to maximize positive
benefits that business endeavor can bring to human and environmental well
being and to minimize the harmful effects of irresponsible business. The
scheme which was developed from this concern is known as the “Corporate
Social Responsibility” (2)
Apart from these international initiatives, RBI report also talked about
other important and urgent issues regarding
1) Global warming & extent of problem,
2) Stern Review – The Economics of Climate Change
3) The Happy Planet Index,
4) The Kyoto Protocol.
• Carbon Trade
The concept of carbon credit came into vogue as a part of an
international agreement popularly known as Kyoto Protocol (KP). The
KP aims to tackle global warming by setting target levels for nations to
reduce greenhouse gas emissions worldwide. The scheme allows
developed nation polluters to fund emissions cuts in developing
countries, which is cheaper than cutting emissions at home.
• Indian Scenario
India acceded to the KP in August, 2002. India is in a position
to reap maximum benefits from the global carbon trade. India, being a
developing country, is exempted from the requirements of adherence
to the Kyoto Protocol. However, it can sell the Carbon Credit to the
developed countries.
During the year 2008, the Company contributed Rs. 81.1 lacs
towards Corporate Social Responsibility to various institutions
for charitable purposes.
Constraints of CSR
Shareholders put their risk capital in a Joint Stock
Company (or business) and therefore, companies should be
managed in the interest of the owners or the shareholders. This
primacy of treatment given to the shareholders is being
justified on the grounds of ownership and shareholding. It is felt
that maximization of profits or the bottom line should be the
ultimate objective of the management. Developing corporations
argue that practicing and following CSR is matter of concern for
companies having big business with lot of resources at their
disposal. It is argued that CSR is the responsibility of the
politicians. It’s not business role to get involved. Business has
traditionally been beyond morality and public policy. Sometimes
CSR is also attached with the ulterior motive of the company
following
Conclusion
References -
1) http://en.wikipedia.org/wiki/Reserve_Bank_of_India
2) http://en.wikipedia.org/wiki/Corporate_social_responsibility
3) http://www.rbi.org.in/scripts/NotificationUser.aspx?Mode=0&Id=3987
4) http://gujarati.economictimes.indiatimes.com/dirreport.cms?year=2008&companyID=
3540&Go=Go
5) http://timesofindia.indiatimes.com/articleshow/msid-3132402,prtpage-1.cms
6) http://timesofindia.indiatimes.com/Business/India_Business/Disha_and_RBI_launch_
comic_book_Raju_and_the_Money_Tree/articleshow/2447522.cms
7) http://www.livemint.com/2007/12/20184250/RBI-asks-banks-to-promote-sust.html
(The Wall Street Journal)
8) http://www.rbi.org.in/scripts/PublicationsView.aspx?id=10924 (corporate social
Responsibility, 2.117)
9) http://www.business-standard.com/bs_csr/news.php?autono=301358
10) http://www.moneycontrol.com/india/news/pressnews/disha-financial-counselling-rbi-
launches-comic-book/307414/1
11) http://www.rbi.org.in/scripts/AnnualReportPublications.aspx?Id=820
12) http://news.in.msn.com/business/article.aspx?cp-documentid=1157346
13) http://www.canarabank.com/Upload/English/PressReleases/CanPrMar07.doc
14) http://www.canarabank.com/Upload/English/PressReleases/CanPrMar07.doc
15) https://www.theasianbanker.com/ind/award.nsf/LeadershipAwards_Winners2008?Ope
nForm
16) http://www.deccanherald.com/deccanherald/july202004/spt9.asp
17) http://www.equator-principles.com/
18) www.wwf.ch
19) http://www.unep.org/
20) Business Line's Journal on Management – December 2004 issue
21) A Brief History of Sustainability Reporting by William Baue Women's Feature Service, August
2004
22) NevilleWardDirect
24) Risk & Opportunity: Best Practice in Non-Financial Reporting by John Elkington