Date : 12 September 2013

Obligatory CSR: Making companies responsible for Governments f!nctions"

Recently ne# Companies $ill 2013 is passe% in t&e parliament replacing age ol% Companies la#"
'&is is a goo% move by t&e government" $!t one partic!lar provision of making spen%ing on
CSR activities comp!lsory to companies is very !n(!st an% abs!r% in its very nat!re" $y
implementing CSR spen%ing t&e government is gra%!ally s&ifting its core responsibilities over to
companies" )n alternate #ay it implies t&at it is parting a#ay from its %!ties an% forcing
companies to foc!s on non*core b!siness activities" +&y s!ppose%ly s&ift social responsibility on
companies beca!se t&ey are alrea%y carrying o!t social responsibility by giving (obs to people, in
#&ic& government &as reasonably faile%, t&e presence of large n!mber of !nemploye% yo!t&
corroborates t&is arg!ment" '&e companies are %oing t&is %!ty very #ell in spite of paying
re-!isite ta.es an% a%&ering strictly to n!mero!s reg!lations an% compliances impose% by
government" '&is recent comp!lsion on CSR spen%ing is only an ne# a%%ition to alrea%y
e.isting &!ge list of compliances" /n% t&e treatment t&e companies get from eac& government
official rig&t from approval a!t&orities to ta. officials is so &ars& an% inconsi%erate" /s if t&ey
are committing some offence by %oing b!siness"
+&ile carrying o!t governments responsibility are companies going to receive consi%erate
treatment by all government a!t&orities of #&ic& t&ey tr!ly %eserve" Company &as to spen%
consi%erable amo!nt to cons!ltants in or%er to avoi% any non compliances beca!se t&ey feel t&at
t&is spen%ing is better t&an paying &efty fines arising from non compliances" /re ta. officials
going to stop s!spicio!s vie# to#ar%s companies0 '&is ne# r!le is total co#ar%ness an% a clear
%epiction of self inefficiency on part of government in form!lating proper policies an% t&ere
implementation frame#ork" / s!btle -!estion &ere arises is * #&y s&o!l% government collect
ta.es if carrying o!t social #ork is companys responsibility" '&en #&at is governments
responsibility0" 1.cl!%ing %efense, in #&at ot&er #ay t&e payment of ta.es &elping companies"
'ake for e"g" roa%s, nearly every single roa% in t&is co!ntry is fille% #it& toll boot&s" Consi%er
e%!cation, #&y no one form mi%%le class an% !pper mi%%le class #ants to e%!cate t&ere c&il%ren
from m!nicipality sc&ools" )s government not responsible for giving con%!cive b!siness
environment to companies" ) %o!bt t&is beca!se of t&e recent &ars& policies of t&e government *
retrospective ta. amen%ments, &ig& pricing of comm!nication ban%#i%t&s an% 3G licenses ,
&oar%ing of coal reserves to itself an% many more" '&e ne# r!le #ill only a%% to t&e e.isting
agonies of companies"
) s!spect if government is &i%ing its o#n let&argy an% la2iness " )t is &ypocritical to make
companies responsible to#ar%s society covering t&e fact * #&at responsibility is government
carrying o!t to#ar%s society" +&y c&il%ren are s!ffering from malno!ris&ment in spite of
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b!mper &arvest " +&y are #e importing coal an% iron ore in spite of &!ge coal an% iron ore
reserves" +&y are yo!t& !nemploye% in spite of sec!ring %egrees an% %iplomas0 'ake for e"g"
passing of po#erf!l an% efficient lokpal bill in parliament" )t itself %ont #ant to be ans#erable
b!t #ant ot&ers to be ans#erable to#ar%s t&ere secon%ary f!nctions"
'&e p!rpose of t&is article is not to %emotivate CSR spen%ing of companies neit&er to stop it" $!t
only raise gen!ine concern of companies t&at CSR spen%ing s&o!l% not be ma%e comp!lsory"
Social responsibility is a collective responsibility of all citi2ens an% not of companies alone"
/lrea%y many companies are spen%ing c&!nk of t&ere profits to#ar%s it" +&y to enforce s!c&
!nre-!ire% r!les, creating a negative image in investor comm!nity" S!c& policing only %epicts
governments &ars& intentions" +&y to cl!tter t&e min%s of entreprene!r #it& e.cessive r!les" )t
only creates one more &ars& reg!lation on companies"
My point is if government #ants reason from companies if t&ey fail to comply t&e minim!m
CSR spen%ing, is government rea%y to give reasons for its o#n fail!res in a clear an%
!n%erstan%able #ay" $eca!se by t&e #ay CSR is companys secon%ary responsibility b!t social
responsibility is governments primary an% most core f!nction" Government is only boasting of
self claime% ac&ievements of incl!sive gro#t& #it& its o#n !nrealistic poverty re%!ction fig!res"
3!rt&er some ministers are (!stifying t&ese claims by saying a in%ivi%!al can s!rvive a %ay in 32
Rs only" / &ars& (oke on poverty" /n% if 45/ or any party in t&at matter fails in t#o s!ccessive
perio%s of 6 years #it& #&at face it is again going among voters to ask for anot&er c&ance in
eac& s!bse-!ent elections" Rat&er t&an pointing o!t silly mistakes of companies, t&e government
s&o!l% foc!s on self introspection an% be more efficient in its o#n f!nctioning"
'&e nee% for 3oo% Sec!rity $ill 73S$8 is itself a s&ame on government" )n spite of t#o
consec!tive terms it &as faile% to keep its promises an% it still feels t&at poor are !nable to fee%
t&emselves an% so it is necessary to fee% t&em" '&!s contra%icting its o#n claims of
ac&ievements" )snt t&is an grave fail!re of social responsibility t&at it faile% to re%!ce poverty"
9o# many more years it #ill take to era%icate poverty" )f social spen%ing is ma%e comp!lsory to
companies no# , tomorro# government #ill make it comp!lsory to in%ivi%!als an% f!rt&er it #ill
make comp!lsory to entire pop!lation b!t itself" +&at is t&e !se of electing a government0 )f at
all CSR spen%ing is a pla!sible comp!lsion t&en #&y give it name as social responsibility alone
give t&e name Corporate :ational Responsibility" Give entire responsibility of e%!cation, roa%s,
electricity, etc" to companies an% close all t&e ministries relate% to it" $eca!se any #ay t&ey #ill
be re%!ce% to #atc&%ogs" /n% finally make %efense of entire nation companies responsibility"
'&en #&y to collect ta.es if companies are t&emselves spen%ing in t&ese matters" ;!estion arises
is governments f!nction only to make la#s an% leave its implementation on companies" Slo#ly a
nee% #ill arise to give s!c& names as Corporate 1%!cation Responsibility, Corporate 9ealt&
Responsibility, Corporate 5olice Responsibility, etc" for speciali2e% spen%ing by companies"
9onorable ministers, please consi%er t&is plea an% avoi% creating s!c& abs!r% an% !nrealistic
r!les an% reg!lations on companies"
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Do #e elect government for %iverging of t&eir responsibilities to ot&er entities or for accepting
t&e responsibilities t&emselves0
Sujeet Patil
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