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GM02

Economics & Social Environment

(For CNM Cases)

                                                                    Assignment - II

Assignment Code: 2016GM02A2                                               Last Date of Submission: 30^th April 2016

                                                                                                Maximum Marks: 100

Attempt all the questions. All the questions are compulsory and carry equal marks.

                                                                         Section-A

1.            “Industrialization and technology can have both good and bad effects on the environment.  But really   it   is   the  way  in   which   we  use  the  technology  that  matters.” Explain with suitable examples.

2.            What are the different forms of Regional Trade Agreement?  Why are countries going for Regional Trade                 Agreements?  Do RTAs act as blessing or burden?

3.            What is the difference between monetary policy and fiscal policy? How effective they are for fighting against economic disturbances like recession.

4.            “Increased interaction between nations through globalization must be a good thing”. DO you agree?   Why?

Section-B

Case Study

India Inc. shifts focus from mere profitability to meeting societal challenges

Corporates’ social responsibility is a matter intrinsically ingrained in the constitution of India which envisages an economic development that does not result in the concentration of wealth and means of production to the common detriment and that material resources of the community are so disturbed as best to sub serve the common good. 

Social responsibility of business refers to what business does over and above the statutory requirement for the benefit of the society.  The word responsibility emphasizes that the business has some moral obligations towards the society.  The term corporate citizenship is also commonly used to refer to the moral obligations of the business towards the society.  It implies that like individuals, corporate are also the part of the society and their behaviour shall be guided by the social norms.

                                                     

The concept of CSR originated in the 1950s in the USA and the concept came into prominence in public debate during the 1960’s and 1970’s.  At that time US had lots of pressing social problems like poverty, unemployment, race, urban blight and pollution.  Corporate Social Responsibility became a matter of utmost importance for diverse groups demanding change in the business.

There are various strategic approaches to CSR.  Some emphasis risk management for instance through reputation management.  Others advocate a more proactive approach to CSR, where finding solutions to social problems becomes part of the company’s business strategy, thereby providing access to important markets.  Quite apart from the company’s contribution to society through job creation, taxation and generating economic spillover effects, the company can develop products, services, production methods and business practices that promote development.  Examples of this include micro credit, mobile telecommunications, solar power and water supply.

The substance and understanding the concept of CSR are dynamic. The focal issues vary according to the area of activity in question, and change over time.  Philanthropy, or donating to good causes, has traditionally been perceived as an expression of a company’s commitment to corporate social responsibility.  Many companies continue to view CSR in terms of charity and support to the local community.  However, there is a growing tendency to see the core area for practicing social responsibility as the company’s own operations.

Corporate social responsibility offers manifold benefits both internally and externally to the companies involved in various projects.

Externally, it creates a positive image amongst the people for its company and earns a special respect amongst its peers.   It creates short term employment opportunities by taking various projects like construction of parks, schools, etc.  Working with keeping in view the interests of local community bring a wide range of business benefits.  For example, for many businesses, local customers are an important source of sales.  By improving the reputation, one may find it easier to recruit employees and retain them.  Businesses have a wider impact on the environment also.  Plantation and cultivation activities taken up by Intel India are a step towards the same.  Recycling used products also acts as a step towards the same.  Recycling used products also acts as a step towards minimizing wastes. 

Internally, it cultivates a sense of loyalty and trust amongst the employees in the organizational ethics.  It improves operational efficiency of the company and is often accompanied by increase in quality and productivity.  More importantly, it serves as a soothing diversion from the routine workplace practices and gives a feeling of satisfaction and a meaning to their lives.  Employees feel more motivated and thus, are more productive.  Apart from this, CSR helps ensure that the organization comply with regulatory requirements.

Questions:

1.         What is Corporate Social Responsibility (CSR)? What are the various strategic approaches to CSR?                                                                                                      

 (10)

2.         What are the benefits of CSR?  What is your opinion about the current amendments made regarding CSR initiatives in the Companies Bill?                                                        

 (10)