CHAPTER - 1

INTRODUCTION

1.1 Background of the Study

In present era, business is much more than just selling goods and earning profit.
Corporate Social Responsibility is one of those activities which a business does apart
from earning profit. The term ―social responsibility‖ is not new in corporate world.
Social responsibility refers to individuals and companies must act in a manner that
benefits their environment and society as a whole. When it applies to business, social
responsibility is known as corporate social responsibility (CSR). This is becoming a more
important area of focus within businesses due to shifting social norms. Socially
responsible organizations adopt policies that encourage the well-being of society and the
environment at the same time reducing the negative impacts on them. Social
responsibility has become gradually more important to investors and consumers who seek
out investments that are not just profitable but also add to the wellbeing of society and the
environment. However, there is an argument that in the basic definition of business,
society is not considered as a stakeholder. “Corporate Social Responsibility is one of
those activities which a business does apart from earning profit (Kotler, P., & Lee, N.,
2005).”

The European Union defined CSR as ―The voluntary integration of companies’ social
and ecological concerns into their business activities and their relationships with their
stakeholders. Being socially responsible means not only fully satisfying the applicable
legal obligations but also going beyond and investing more’ in human capital, the
environment, and stakeholder relations.

According to International Organization for Standardization (ISO) 26000―The

responsibility of an organization for the impacts of its decisions and activities on society
and the environment, resulting in ethical behavior and transparency which contributes to
sustainable development, including the health and well-being of society; takes into

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account the expectations of stakeholders; complies with current laws and is consistent
with international standards of behavior; and is integrated throughout the organization
and implemented in its relations.‖

Philip Kotler and Nancy Lee (2005) define CSR as ―a commitment to improve
community well being through discretionary business practices and contributions of
corporate resources‖ whereas Mallen Baker refers to CSR as ―a way companies manage
the business processes to produce an overall positive impact on society.‖

According to World Business Council for Sustainable Development ―Corporate

Social Responsibility is the continuing commitment by business to behave ethically and
contribute to economic development while improving the quality of life of the workforce
and their families as well as of the local community and society at large‖.

Archie Carroll in 1991 describes CSR as a multi layered concept that can be
differentiated into four interrelated aspects – economic, legal, ethical and philanthropic
responsibilities (Carroll, A. B., 1991). Carroll presents these different responsibilities as
consecutive layers within a pyramid, such that ―true‖ social responsibility requires the
meeting of all four levels consecutively. The model probably is the most accepted and
established.

Howard Bowen, often regarded as the father of CSR, has defined corporate social
responsibility as the obligations of businessmen to pursue those policies, to make those
decisions, or to follow those lines of action which are desirable in terms of the objectives
and values of our society (Bowen, 1953). Bowen is one of the earliest writers to have
defined CSR.

1.2 Evolution of CSR

The stories of corporate donating for social causes are centuries old. Many corporate cum
philanthropists have left their mark on society by their efforts. They believed that they
had special responsibility towards society because they earned from it, but it was not like
CSR as it looks now.

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The term was coined first in 1953. In his publication named Social Responsibilities of the
Businessman, American economist Howard Bowen coined the term and he is often
referred as the father of CSR (Chatterjee, A., & Mitra, N., 2018) .

In India, there are sufficient anecdotal facts available giving us sense about how corporate
groups were engaged in building universities, hospitals etc. During the freedom struggle,
they have played a crucial role in funding the freedom movement. Mahatma Gandhi,
father of the nation was closely associated with several businessmen cum philanthropists.
But, most of the donations were going through religious institutions with the purpose of
helping the dispossessed. On the international front, philanthropic activities by
industrialists can be traced back to the Industrial Revolution. By the mid-to-late 1800s,
there were growing concerns regarding workers’ wellbeing. Many reformers were raising
the issues of the emerging factory system, working conditions and condition of labourers.
Whether connected or not but this was the time when the rise of philanthropy can also be
traced. One industrialist named Andrew Carnegie donated large portions of his wealth to
causes related to education and scientific research. He had made most of his fortune in
the steel industry. Many other industrialists followed his footsteps. Like John D.
Rockefeller, who is widely considered the wealthiest American of all time, and the richest
person in modern history, donated more than half a billion dollars to religious,
educational, and scientific purposes. He had made his fortune in the oil industry.

But it was all informal. It was American economist Howard Bowen who gave it a clear
identity. However, a question remains unanswered: how does the term get accepted in the
whole world? After the effort of Howard Bowen, there was a sort of lull period for the
next few decades. But in1990s, many other economists focused on it. In 1991, University
of Pittsburgh professor Donna J. Wood published Corporate Social Performance
Revisited. He expanded and improved on early CSR models by providing a framework
for assessing the impacts and outcomes of CSR programs.

In the same year, another professor at the University of Georgia Archie B. Carroll
published an article named The Pyramid of Corporate Social Responsibility. Since then,
the term CSR has become an essential strategy for many organizations. India moved

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ahead and brought a legal framework to ensure big corporates don’t forget their social
responsibilities.

1.3 The CSR Law

CSR in India has traditionally been seen as a philanthropic activity. However, with the
introduction of Section 135 in the Companies Act 2013, India became the first country to
have statutorily mandated CSR for specified companies. e Companies Act, 2013, a
successor to The Companies Act, 1956, made CSR a compulsory act. Under the
notification dated 27.2.2014, under Section 135 of the new act, CSR is compulsory for all
companies- government or private or otherwise, provided they meet any one or more of
the following fiscal criterions:

• The net worth of the company should be Rupees 500 crores or more

• The annual turnover of the company should be Rupees 1000 crores or more 

Annual net profits of the company should be at least Rupees 5 crores.

If the company meets any one of the three fiscal conditions as stated above, they are
required to create a committee to enforce its CSR mandate, with at least 3 directors, one
of whom should be an independent director.

The responsibilities of the above-mentioned committee will be:

• Creation of an elaborate policy to implement its legally mandated CSR

activities. CSR acts should conform to Schedule VII of the Companies Act,
2013.

• The committee will allocate and audit the money for different CSR purposes.

• It will be responsible for overseeing the execution of different CSR activities.

• The committee will issue an annual report on the various CSR activities
undertaken.

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 • CSR policies should be placed on the company‘s official website, in the form
and format approved by the committee.

• The board of directors is bound to accept and follow any CSR related
suggestion put up by the aforementioned committee.

• The aforementioned committee must regularly assess the net profits earned by
the company and ensure that at least 2 percent of the same is spent on CSR
related activities.

• The committee must ensure that local issues and regions are looked into first
as part of CSR activities.

1.4 Features of CSR Laws

The broad and important features of the CSR laws are as follows:

• Quantum of money utilized for CSR purposes are to be compulsorily included

in the annual profit-loss report released by the company.

• The CSR rules came into force on 1st April 2014 and will include subsidiary
companies, holdings and other foreign corporate organizations which are
involved in business activities in India.

• CSR has been defined in a rather broad manner in Schedule VII of Companies
Act, 2013. The definition is exhaustive as it includes those specific CSR
activities listed in Schedule VII and other social programmes not listed in
schedule VII, whose inclusion as a CSR activity is left to the company’s
discretion.

1.5 Objectives of CSR

• To provide a neutral and credible platform to all stakeholders engaged in CSR
best practices for capturing relevant issues to foster sustainable growth.

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• To provide research, training, practice, capacity building, standard setting,
advocacy, rating, monitoring, recognition and related support in the field of
CSR.

• To facilitate exchange of experiences and ideas between various stakeholders

for developing a framework for strengthening of CSR indicatives.

• To facilitate any other assistance directly or indirectly for activities which seek
to promote CSR practices.

• To establish and deepen links with the organisations in various parts of the
world which promote CSR practices for exchange of ideas and for collaborative
actions and programmes.

• To collaborate and to support, directly or indirectly, the initiative of any

individual, group, organisation or institution in promoting good practices in
CSR.

• To establish a database of credible implementing outfits with whom the

corporate entities as well as the donor organisations can collaborate and work.

• To create CSR fund with contribution of Government PSUs and private sector
companies and channelize the CSR fund for optimum utilisation through a
sustainable mechanism.

• To implement various CSR projects of state importance through credible

implementing agencies in that area.

• To conduct activities relating to

o Public health in general but preventive health care and sanitation in

particular o Promotion of employment enhancing vocation skills

especially among youth

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 o Promotion of an ecosystem for enhancement of cognitive growth of Pre-
Anganwadi children o Contributions of funds to the technology

incubators located within Gujarat o Such other activities relating to CSR as may

be prescribed in the Companies Act 2013 or Companies (Corporate Social

Responsibility Policy) Rules, 2014 or any other rules which Central

Government may make from time to time.

• To do all such other things as may be deemed incidental or conducive to the

attainment of the above objects.

1.6. CSR Practices

1.6.1. ITC
ITC has been doing impactful CSR activities in India for years now. ITC has
educated about 2,52,329 children through its 2,334 Supplementary Learning
Centres. They have also supported empowered about 15378 women members
through 1183 self – help groups.

1.6.2. Tata Power

Tata Power has made it its topmost priority to empower women through its
Self Help Groups in Kutch Region of Gujarat. This initiative provides
financial aid and loans for housing, purchasing cattle, capital for business,
education, marriage and medical purposes.

1.6.3. Infosys
Infosys is one of the early adopters of Corporate Social Responsibility. They
have take up projects like the restoration of water bodies in Karnataka and
metro station construction in partnership with Bangalore Metro Rail
Corporation Limited. Also, they are making a contribution in Sports through

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 their GoSports Foundation. Their CSR initiative also includes a relief fund for
Tamil Nadu, Karnataka and Kerala.

1.6.4. Reliance
Reliance has taken up the initiative of securing the life of villagers of Balangir
district. They have a life insurance programme for them. The ―Education for
All‖ initiative was launched to provide access to quality education in India to
everybody. They work to protect the right to education of underprivileged
children, girl-child and differently-abled. They also contribute to disaster
relief funds.

1.6.5. Tata Steel

Tata Steel, for the last 100 years, has been committed to the social
development and upliftment of Jharkhand. The agenda of their CSR
committee is to improve the quality of life of the communities it operates in.
They also launched a train called ―Lifeline Express‖ in 1991, a running
hospital, that serves the needy regions of India. They have done numerous
done AIDS awareness programmes.

1.6.6. AMUL
Over the years, Amul has contributed to rural health and development through
Tribhuvandas Foundation. They have also established Swarnjayanti Gram
Swarozgar Yojana, a holistic self-employment programme in Kheda district.
They also successfully run tree plantation drives, blood donation camps and
rural sanitation programmes. They also provide scholarships through their
Amul Scholar schemes.

1.6.7. Cafe Coffee Day

The beloved coffee shop, Cafe Coffee Day, employs 50 speech and hearing
impaired people at their various outlets as staff. They do this as a part of their
CSR activity as a move towards equal employment. They called them the
‗Silent Brew-masters‘. CCD also has tie-ups with NGO Enable India to

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 empower differently-abled people. Their biggest CSR initiative is the SVGH
Vocational Training College in Chikmagalur, Karnataka.

1.6.8. P&G
―Shiksha – Padhega India, Badhega India‖ is a crucial part of Procter &
Gamble‘s CSR. THE Shiksha initiative has, till date, helped about 280,000
underprivileged children to get access to their right to education. They have
also built & supported over 140 schools across India.

1.6.9. Wipro
Wipro makes its contribution to education and upliftment through Wipro
Care. Not just education, Wipro addresses disaster relief and rehabilitation
and health and wellness programmes for the needy as well through Wipro
Care. They have also launched Wipro Eye that promotes ecological
sustainability in its operations.

1.6.10. DLF
DLF is India‘s largest real estate company. Initiated in the interest of
educating children of construction workers, Swapana Sarthak Informal School
was established. They have also set up employable vocational training centres
under the banner of DLF LIFE.They‘ve also set up DLF Inspire to improve
the quality of life of underprivileged children.

1.7. Key Principles of CSR

European Commission has defined corporate social responsibility as a concept where
corporations combine their environmental and social concerns with their operations and
collaborate on a voluntary basis with their stakeholders (Crowther & Güler, 2008).There
are three basic principles of corporate social responsibility which are Sustainability,
Accountability and transparency.

1.7.1. Sustainability: Corporate Social Responsibility (CSR) and sustainability both

focus on an organisation‘s efforts to contribute positively to environmental
and social impacts. Sustainability focuses on meeting the needs of the present

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 without compromising the ability of future generations to meet their needs.
The concept of sustainability is composed of three pillars: economic,
environmental, and social—also known informally as profits, planet, and
people. Increasingly, companies are making public commitments to
sustainability through actions like reducing waste, investing in renewable
energy, and supporting organizations that work toward a more sustainable
future. (Grant, 2020)

1.7.2. Accountability: Both corporate responsibility and corporate accountability

believe that corporations have responsibilities beyond generating a profit for
their shareholders. Such responsibilities include the negative duty to refrain
from causing harm to the environment, individuals or communities, and the
positive duty to protect society and the environment—by protecting the rights
of workers and communities affected by business activities.

1.7.3. Transparency: Transparency means winning the trust and loyalty of your
customers. In order to do that these days, your company needs to show up as
authentic, transparent, and purposeful. Just like any other market condition,
the ground has shifted underneath companies when it comes to corporate
giving.Consumers and investors are simply expecting more and better
information out of companies with regard to their CSR and corporate giving
programs.

1.8. Need and Importance of CSR

1.8.1. Customers Matter

Embracing socially responsible policies goes a long way toward attracting and
retaining customers, which is essential to a company‘s long-term success.
Furthermore, many individuals who know that part of a company's profits will
be channeled toward social causes near and dear to them will gladly pay a
premium for goods.

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 Companies can likewise witness increased foot traffic if they're committed to
supporting the local community. For example, banks that dispense loans to
low-income households are apt to see an uptick in business as a direct result.

1.8.2. Increases Employee Motivation

Social responsibility is an effective tool to increase employee engagement.
These companies tend to attract employees who are eager to make a
difference in the world—in addition to simply collecting a paycheck. With
large companies, there is strength in numbers, and collective employee efforts
can achieve substantial results, which increases workplace morale and boost
productivity. According to Harvard Business School, nearly 70% of
employees say they would not work for a company without a strong purpose.
Ninety percent of employees who work at companies with a strong sense of
purpose say they‘re more inspired, motivated, and loyal, and 92% of
employees who work at a socially responsible company say they would be
more likely to recommend their employer to those in their network who are
looking for a job. Research shows that employee engagement translates
directly to a company's overall performance and bottom line: engaged
employees have a 17% increase in productivity, are 21% more profitable, and
can have 41% lower absenteeism. To sum it all up, even a small investment in
corporate social responsibility initiatives can increase employee engagement
and have an impact on how profitable the company can be.

1.8.3. Community Support and Customer Loyalty

Social responsibility works as a platform for companies and consumers alike
to make a positive impact on local and global communities. Businesses that
implement a social responsibility initiative that’s in line with their values have
the opportunity to increase customer retention and loyalty. Research shows
that 87% of American consumers are more likely to buy a product from a
company that advocates for an issue they care about, and 76% would refuse to
purchase a product if they found out a company supported an issue contrary to
their beliefs.

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 Community-oriented companies often enjoy a leg up on their competition as
well, thanks to superior brand imaging. For example, Tesla Inc. (TESLA)
CEO Elon Musk has successfully attracted environmentally-minded
consumers with his line of cutting-edge electric cars and green automotive
products.

1.8.4. CSR Shows a Sign of Accountability to Investors

Businesses that are socially responsible can also appear more attractive to
investors. In my experience, investors in a business have one common goal: to
have greater returns than invested funds. I view businesses that are able to
manage finances while still helping their communities as accountable and
transparent in their dealings. According to a 2016 report by Aflac, investments
in CSR are not typically viewed by investors as a waste of money, but rather
an "indicator of a corporate culture less likely to produce expensive missteps
like financial fraud." The study said 61% of investors consider CSR a sign of
"ethical corporate behavior, which reduces investment risk."
1.8.5. CSR Saves Money
You might not expect a CSR strategy to improve your bottom line because it
typically requires investment in projects. However, as mentioned above, many
customers are willing to pay more for products from a socially responsible
brand, and CSR can help attract and retain employees. Given that turnover can
cost companies thousands of dollars, this is worth noting.

1.8.6. Corporate Social Responsibility goes a Long Way in Creating a Good Brand
Image
Doing something for your society, stake holders, customers would not only
take your business to a higher level but also ensure long term growth and
success. Corporate social responsibility plays a crucial role in making your
brand popular not only among your competitors but also media, other
organizations and most importantly people who are your direct customers.

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 People develop a positive feeling for a brand which takes the initiative of
educating poor children, planting more trees for a greener environment,
bringing electricity to a village, providing employment to people and so on.
You really do not have to invest much in corporate social responsibility
activities. Do not undertake CSR activities only to gain publicity but because
you believe in the cause. There are many organizations which tap remote
villages, some of which are even unheard as an initiative of corporate social
responsibility
.

1.9. Brand Image

Brand image is the current view of the customers about a brand. It can be defined as a
unique bundle of associations within the minds of target customers. It signifies what the
brand presently stands for. It is a set of beliefs held about a specific brand. In short, it is
nothing but the consumers’ perception about the product. It is the manner in which a
specific brand is positioned in the market. Brand image conveys emotional value and not
just a mental image.

Brand image is the overall impression in consumers’ mind that is formed from all
sources. Consumers develop various associations with the brand. Based on these
associations, they form brand image. An image is formed about the brand on the basis of
subjective perceptions of association bundle that the consumers have about the brand.
Volvo is associated with safety. Toyota is associated with reliability.

The idea behind brand image is that the consumer is not purchasing just the
product/service but also the image associated with that product/service. Brand images
should be positive, unique and instant. Brand images can be strengthened using brand
communications like advertising, packaging, word of mouth publicity, other promotional
tools, etc. Businesses spend a lot of time curating a brand personality, voice, and brand
positioning in the marketplace. It goes beyond visible elements such as having an
identifying symbol, mark, logo etc. that companies can use to distinguish themselves

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from rivals. All these elements of a brand contribute to the way a customer interacts with
and perceives your brand, which culminates in brand image.

1.10. Positive Brand Image

Today, many consumers (especially millennials and Generation Z) don’t buy your
product or service simply because you have the best option, but because of what you
stand for. In fact, a Harvard Business Review study found that 64% of consumers say that
shared values is the primary reason they have a relationship with a brand. That was, by
and large, the biggest driver, and only 13% cited frequent interactions as the primary
reason for a relationship. That means that, while you must interact with your customers,
the quality of your interactions matters more than the quantity for brand perception.

This is particularly true in the post-pandemic world: 61% of people said that how a brand
responded to the crisis would have a large impact on whether they‘d keep their
relationships with them afterwards.It’s not just how businesses care for others, either –
it‘s about how they care directly for customers. We found in our Global Consumer
Trends Report 2022 that more than 60% of consumers feel that businesses need to care
more about them and that they‘d actually buy more if they felt that care.

1.11. CSR and Brand Image

When we speak of branding for companies and businesses, the first thing that comes to
mind involves the use of a logo, a tag line, and a name unique to that entity. After all,
branding has one end goal: creating a differentiated name and image for a company,
business, organization, product, or service. Implementation of a CSR policy may generate
a trusting relationship that leads stakeholders to become committed to the organization
through actions such as customer loyalty, stockholder capital investments, and supplier
investments (Garbarino & Johnson, 1999; Maignan & Ferrell, 2004; Sen, Bhattacharya &
Korschun, 2006). In the global marketplace, a firm‘s social and environmental track
record and its treatment of employees are considered as very important trust issues
(Edelman, 2008).

Branding, in this context, involves using social responsibility to create that

differentiation. Instead of a specific name or a logo, it uses an entity’s social

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responsibility program, which is demonstrated through various relevant actions. These
actions will then establish the company’s presence in the minds of the consumers and the
general public, as a whole.

If you look at the brand management strategies of various companies, one thing is
constant: they advertise. They spend on their marketing campaigns. They put out
promotional materials and perform promotional activities to put their name out there.
They tap into various distribution channels in order to increase their visibility. The more
effort they put into it, the higher their brand equity becomes.

Showing that they have a strong social responsibility policy in place has been seen as a
very effective way of generating positive press for companies. The media pays more
attention to them and they become instrumental in letting a wider audience know about
the company’s ―good works‖. It is, for all intents and purposes, a way to advertise the
company.

Loyalty and trust of customers are what businesses are most after for their brands to be
successful and enduring. Indeed, customers tend to be loyal to brands that stick to them
for all the right and positive reasons.

1.12. Strengthen Your Brand

Presenting yourself as ―socially responsible‖ is a fantastic way to give yourself authority
in your industry, and build a stronger platform for your brand. As mentioned above,
people prefer to engage with companies that have strong values, and the right CSR
strategy could even make your story more compelling so that you stand out ahead of your
competitors. Gregory and Wiechmann (1997) by linking the corporate brand name with
attributes and aspects like value, innovation, community mindedness, environmental
consciousness and good management, explained the role of brand as a mean to building a
special relationship with its favourable target audiences.

1.13. Attract and Retain Top Talent

We all know that people are the key to any thriving company, that‘s why it‘s so important
to make sure that you attract and retain the right talent for your organisation. A study in

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Stanford found that MBA graduates would sacrifice up to $14,000 on their annual salary
just to work for a more socially responsible company.

In other words, the people with the best skills simply want to feel as though they’re
making a difference in the world. That‘s particularly true for millennials. Around 80% of
13-25-year-olds would prefer to work for companies that care about their impact on
society.

1.14. Increase Brand Affinity

People like to connect themselves to companies that do good things because it makes
them feel as though they’re better people overall. A survey conducted by Nielsen found
that 50% of customers around the world would pay more for services and goods from
responsible companies.

However, you can lose out on brand affinity if your customers feel as though you’re only
engaging in CSR efforts to improve sales. This simply means that you’ll need to make
sure that the programs you implement are as authentic as possible.

1.15. Engage Employees

As mentioned above, employees today don’t just want to work for a business that pays
the bills, they want to feel as though they’re having a real impact on the world around
them. When you get your staff involved with important social programs, they’ll naturally
feel more engaged at work. This means that your whole brand benefits from more
focused, productive, and efficient workers.

1.16. Differentiate Your Brand

Finally, brand is all about finding a way to separate your company from all the similar
businesses out there that offer competing products and services. By engaging in a
corporate social responsibility strategy, you show your customers that you’re not just
another copy-paste business producing the same old solutions.

A company with a CSR definition stands for something bigger than itself, and because of
this, it stands out too. With a solid corporate responsibility campaign, you can outshine
your competitors, and make your target audience take notice.
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The role of business in society has undergone several changes. Awareness of the impact
of business on society and environment has grown along with the increasing socio-
regulatory pressures. It is no longer simple enough to employ people, make profits and
pay taxes. Companies are now expected to be responsible, accountable and benefit the
society as a whole (Brown, 2001). Business cannot escape from society and society
cannot exist without business (Davis and Frederick, 1985). Thus, there is a two way
relationship between business and society, Cannon (1994) holds the view that business is
expected to create wealth, supply market, generate employment, innovate and produce a
sufficient surplus to sustain its activities and improve its competitiveness while
contributing to the maintenance of community in which it operates.

Consumers consider switching to another company's products and services, speak out
against the company to family/friends, refuse to invest in that company's stock, refuse to
work at the company and boycott the company's products and services in case of negative
corporate citizenship behaviours (Edenkamp, 2002).The modern consumer understands
CSR that much more intimately. The future of marketing is full of CSR (Harish Bijoor,
2008).

CSR has an important role to play especially in building up trust in the minds of the
consumers. In an emerging market where consumers are looking for functional products
which last longer and accelerated obsolescence is not a problem like in developed
markets, the consumer perception about the company brand assumes significance. A
company which builds the image of producing quality products that last longer though
they may not be on the cutting edge of technology will actually be able to gain strategic
advantage in emerging economies. Firms all over the world are beginning to grasp the
importance of intangible assets, be it brand name or employee morale. Only firms that
have gained the goodwill of the general public and are ideal corporate citizens will be to
develop these intangible assets into strategic advantages (Edenkamp, 2002). CSR
practically has the same effects as advertisements, because it sheds a positive light on a
brand or product. That is why CSR can also be seen as an expression of marketing. By
including the brand name in social responsible campaigns, brand awareness and brand
recognition are raised. It's clear that the concepts of value and values are rapidly merging

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in the minds of consumers. People want to be engaged with companies that share their
values (Scott Beaudoin, 2009).

1.17. CSR in India

Prior to the Companies Act 2013, Corporate Social Responsibility (CSR) in India was
traditionally seen as a philanthropic activity. In keeping with the Indian tradition, it was
believed that every company had a moral responsibility to play an active role in
discharging social obligations, subject to the financial health of the company (Ghosh,
2014). In the early 1990s, Mahatma Gandhi introduced the concept of trusteeship,
emphasizing socio-economic growth (Singh & Verma, 2017). CSR in India was
influenced by family values, traditions, culture, and religion (Chatterjee & Mitra, 2018).

On 29th August 2013, the Companies Act, 2013 replaced the Companies Act of 1956.
The new Act introduced far-reaching changes that affect company formation,
administration, and governance, incorporating an additional section—Section 135, which
mandates Corporate Social Responsibility (CSR) obligations for companies listed in
India (The Companies Act, 2013). This clause outlines the essential prerequisites for
execution, fund allocation, and reporting, ensuring the successful implementation of CSR
projects (The Companies Act, 2013, Section 135).

India became the first country to legislate the need to undertake CSR activities and
mandatorily report CSR initiatives under the new Companies Act 2013. This is the
beginning of a new era for CSR in India.

The enactment of the Companies Act, 2013 by the Ministry of Corporate Affairs,
Government of India was one of the world's largest experiments in introducing CSR as a
mandatory provision, imposing a statutory obligation on companies to undertake CSR
projects for social welfare activities (Ministry of Corporate Affairs, 2013). This has made
India the only country to regulate and mandate CSR for select categories of companies
registered under the Act. This CSR initiative aims to push the nation toward achieving
sustainable development goals (SDGs) and fostering public-private partnerships in India's
transformation (Ministry of Corporate Affairs, 2013).

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Tata Consultancy Services have the highest number of CSR activities in India. There are
over more than 16000 companies in India that do CSR activities. CSR activities are
expected to be done by medium scale and large scale companies, especially ones which
have their production in activities that are harmful to the environment or society. CSR is
a successful program in India. It has been observed that companies are taking efforts in
fulfilling their CSR duties and contributing more than the required target in CSR
activities. The CSR initiatives by various companies have achieved a number of
milestones and have been working actively for the well-being and betterment of society
(Singh & Sharma, 2016). However, on the other hand, companies are gaining just as
much, or even more, from their CSR efforts (Choudhury & Das, 2017). Taking up
corporate social responsibility ensures that the company is committed to ethical values
and works on ensuring environmental health, even in their private projects (Gupta,
2018). These projects help them gain publicity and attract a number of stakeholders due
to their trustworthy status (Bhat & Kumar, 2019). Furthermore, CSR efforts contribute to
employee satisfaction and improve brand loyalty, which ultimately leads to increased
profitability (Sharma & Kapoor, 2015). Companies that integrate CSR into their
business model often see an improvement in their reputation and long-term
sustainability (Malhotra & Sood, 2017). CSR initiatives also help companies mitigate
risks associated with environmental and social challenges (Kumar & Jain, 2016).

1.18. Top ten CSR companies in India for FY 2021-22

As per the report of The CSR Journal, the top ten companies which spent huge amount on
CSR are:

I. Reliance Industries Limited

Reliance is India’s largest company by market capitalisation. It is a significant global
player in the integrated energy value chain and has established a leadership position
in the Retail and Digital Services business in India.

Reliance Industries Limited has been the top CSR spender in the country for the last
several years. The Company spent ₹1186 crores on its CSR initiatives in FY202122,

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higher than what it was obligated to spend as per the Companies Act ( ₹ 1112
crores).

II. Tata Consultancy Services Limited

Tata Consultancy Services (TCS), an IT services, consulting, and business solutions
company that is part of the Tata Group, has been assisting many of the biggest
companies in the world with their transformational journeys for more than 50 years.
In FY 2021-22, the company spent more on CSR than was required ( ₹716 crores),
spending a total of ₹ 727 crores.

III. HDFC Bank Limited

HDFC Bank is India‘s largest private sector bank by assets and the world‘s 10th
largest bank by market capitalisation as of April 2021. In FY2021-22, although the
bank was obligated to spend Rs. 733.86 crores, it spent Rs. 736.01 crores on its CSR
initiative.

IV. ICICI Bank Limited

ICICI Bank is a leading private-sector bank in India. It is the fourth largest company
in the country as per market capitalisation. In FY2021-22, the bank spent Rs. 266.62
crores for its CSR initiatives, more than it was obligated to spend (Rs. 259.61
crores).

V. Infosys Limited
In India, Infosys Limited was a pioneer in the CSR movement. The majority of its
CSR projects have been carried out through the Infosys Foundation, which was
founded in 1996—long before CSR was legislated in the country. In FY 2021-22,
the company spent Rs. 344.91 crores for its CSR programmes. It was, however,
obligated to spend Rs. 396.70 crores as per the company‘s latest annual report.

VI. Hindustan Unilever Limited

Hindustan Unilever Limited (HUL) is a consumer goods company established in
1931. The company‘s products are very popular in Indian households, making it the
sixth-largest company in the country by market capitalisation. In FY2021-22, HUL

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was prescribed to spend Rs. 184.43 crores on its CSR. However, it spent Rs. 157.58
crores on it.

VII. State Bank of India

Since 1973, long before India‘s government mandated CSR, the State Bank of India
has been actively engaged in CSR practices. Making a significant and demonstrable
difference in the lives of economically, physically, and socially challenged
communities across the nation is the main goal of the Bank‘s CSR philosophy. In FY
2021–22, the bank invested Rs. 204.10 crores in CSR projects.

VIII. Housing Development Finance Corporation Limited

Housing Development Finance Corporation Limited also known as HDFC is a major
player for housing finance in India. It also has a presence in banking, life and general
insurance, asset management, venture capital and education loans. In FY 2021-22,
the company spent Rs. 194.03 crores on its CSR initiatives, more than the amount it
was obligated to spend, which stood at Rs. 190.53 crores.

IX. Adani Enterprises Limited

Adani Enterprises Limited is the flagship entity of the Adani Group. The company
spent Rs. 12.87 crores on CSR in FY2021-22.The Adani Group‘s core philosophy is
‗Nation Building‘, driven by ‗Growth with Goodness‘, its beacon for sustainable
growth. The Adani Group is committed to widening its ESG footprint with an
emphasis on climate protection and increasing community outreach through CSR
programmes woven around sustainability, diversity and shared values.

X. Bharti Airtel Limited

Although telecom company Bharti Airtel was under no obligation to spend on CSR
activities this year (due to net losses), the company has contributed Rs. 16.43 crores
for CSR. Bharti Airtel conducts its CSR initiatives through Bharti Foundation. The
company believes that strengthening the education system is an essential investment
in our country‘s future and has pledged to contribute towards it.

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Among these top ten companies we have picked up to companies for our study. These are
Reliance Industries Limited and TATA Group of Industries. These companies always
shine in the list of top CSR companies and have a good corporate reputation.

1.19. Ratan Tata: A Visionary Leader and Philanthropist

1.19.1. Introduction
Ratan Tata is one of India‘s most influential and respected business leaders.
Born on December 28, 1937, he is the former chairman of Tata Sons and the
Tata Group, one of India‘s largest and most diversified conglomerates.
Known for his visionary leadership, ethical business practices, and deep
commitment to social welfare, Ratan Tata has played a crucial role in
shaping modern India‘s corporate landscape. His contributions extend
beyond business, making a profound impact on society through numerous
philanthropic initiatives. Even after stepping down from active leadership,
his influence continues to inspire generations of entrepreneurs and social
leaders worldwide.

1.19.2. Early Life and Education

Ratan Naval Tata was born into the prestigious Tata family, but his early life
was not without challenges. His parents, Naval Tata and Soonoo Tata,
separated when he was just seven years old, and he was raised by his
grandmother, Lady Navajbai Tata. Despite personal hardships, he excelled
academically and pursued higher education at Cornell University, where he
earned a degree in architecture and structural engineering. Later, he attended
the Advanced Management Program at Harvard Business School, which
further refined his leadership and management skills.

1.19.3. Journey in the Tata Group

Ratan Tata‘s career at Tata Group began in 1961 when he joined Tata Steel
as an apprentice on the shop floor. Unlike many business heirs who directly
enter leadership positions, he started at the grassroots level, gaining handson

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 experience in the industry. Over the years, he worked across various Tata
companies, understanding the intricacies of the business.

In 1991, he was appointed as the chairman of Tata Sons, succeeding J.R.D.

Tata. Under his leadership, the group underwent massive transformation and
global expansion. He spearheaded major acquisitions, including Tetley Tea,
Jaguar-Land Rover, and Corus Steel, positioning Tata Group as a global
player. His leadership saw the launch of revolutionary products such as the
Tata Nano, the world‘s most affordable car, aimed at providing middle-class
Indians with accessible transportation. Ratan Tata‘s emphasis on innovation,
ethical governance, and corporate social responsibility played a crucial role
in strengthening Tata Group‘s global reputation.

1.19.4. Philanthropic Contributions and Noble Deeds

Beyond business, Ratan Tata has dedicated a significant part of his life to
philanthropy. Through Tata Trusts, one of India‘s oldest and largest
charitable organizations, he has contributed immensely to healthcare,
education, rural development, and environmental sustainability.

I. Contributions to Healthcare
Ratan Tata has made substantial contributions to the healthcare sector. He
played a crucial role in funding cancer research and treatment facilities,
including the Tata Memorial Hospital, which provides affordable cancer
care to thousands of patients. During the COVID-19 pandemic, Tata
Trusts donated substantial funds to provide medical equipment, testing
kits, and relief support to affected communities. His contributions to
medical research, particularly in biotechnology and artificial intelligence
for healthcare, have helped revolutionize treatment methodologies.

II. Education and Skill Development Initiatives

Education has been a key focus of Ratan Tata‘s philanthropic efforts. He
has established numerous scholarship programs for underprivileged
students, enabling them to study at prestigious institutions such as

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 Harvard, Cornell, and MIT. He has also supported research institutions
and universities in India, including the Indian Institute of Science (IISc)
and the Tata Institute of Social Sciences (TISS). His initiatives in skill
development programs have empowered thousands of young individuals
by providing vocational training and employment opportunities.

III. Rural Development and Social Welfare

Ratan Tata has always emphasized improving the quality of life for rural
communities. His initiatives in providing clean drinking water, sanitation,
and rural electrification have benefitted millions. He has been actively
involved in agricultural development, helping farmers with better
irrigation techniques and sustainable farming practices. His foundation has
also supported self-help groups and small businesses, enabling rural
entrepreneurship.

IV. Disaster Relief and Humanitarian Aid

Ratan Tata has consistently extended help during times of crisis. After the
2008 Mumbai terrorist attacks, he led rehabilitation efforts for the victims,
supporting their families financially and emotionally. He also contributed
significantly to relief efforts during natural calamities such as the
Uttarakhand floods, the Gujarat earthquake, and the Tsunami in 2004. His
efforts ensured immediate aid and long-term rehabilitation for affected
communities.

1.19.5. Legacy and Recognition

Ratan Tata‘s contributions to business and society have earned him
numerous accolades. He has been honored with the Padma Bhushan (2000)
and Padma Vibhushan (2008), two of India‘s highest civilian awards.
Internationally, he has received several honors, including honorary
doctorates from prestigious universities and recognition from global
business forums. Despite his immense success, he remains humble and
dedicated to social causes, making him a true inspiration.

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 1.19.6. Conclusion
Ratan Tata is more than just a business tycoon; he is a visionary leader,
philanthropist, and humanitarian. His life journey reflects resilience,
innovation, and a deep sense of responsibility towards society. His legacy
continues to influence not only the corporate world but also millions of
individuals who aspire to make a difference. Through his philanthropic
initiatives, he has touched countless lives, proving that true leadership is not
just about financial success but about making the world a better place for
everyone.

1.20. Significance of the Study

Studying the role of CSR in building brand image of a company is crucial in
understanding how CSR initiatives contribute to a company‘s reputation and consumer
trust. CSR has evolved from being a mere philanthropic activity to a strategic tool for
brand building. Companies like Tata Group and Reliance Industries invest heavily in
social initiatives such as education, healthcare, environmental sustainability, and rural
development. Tata, known for its long-standing ethical business practices and
philanthropic legacy, integrates CSR deeply into its corporate philosophy. In contrast,
Reliance Industries, with its large-scale social impact programs, leverages CSR to
enhance its corporate identity and strengthen its market presence. Analyzing their
approaches provides valuable insights into how CSR influences brand perception and
consumer loyalty.

Furthermore, this study helps explore the impact of CSR on financial performance,
investor confidence, and long-term business sustainability. Consumers today prefer
brands that demonstrate social responsibility, and companies that align their CSR efforts
with their brand values often enjoy higher trust and engagement. By comparing Tata and
Reliance, this research can reveal whether a strong CSR strategy leads to increased
profitability and competitive advantage. Additionally, the findings can guide other
corporations in structuring effective CSR programs that not only benefit society but also
enhance corporate reputation. This study also has implications for policymakers, helping

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them understand the significance of CSR in corporate governance and sustainable
development.

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