Wednesday, June 29, 2005

CSR (Corporate Social Responsibility) in India

20 May 2005

The following answer to a question from a PhD student in Germany may be of wider interest, so I am posting it as a blog:

Her letter read as follows:

Dear Professor Guptara,

I am currently pursuing my PhD in the field of corporate sustainability reporting. My research compares the information sought by employees in different countries and cultures as well as their references to the concept of sustainability in order to make suggestions for adequate sustainability related communication in different countries. Focusing on a comparison between India and Germany, I also analyse cross-cultural principles of effective knowledge transfer in a trans-national organization. I am on scholarship from the German National Academic Foundation (Germany's largest sponsor of intellectually outstanding students).

It was with great interest that I read your article entitled "The Limits of Corporate Social Responsibility in India" (published by the EU-India CSR Network, Brussels, Belgium). Therein you assert that "In India, responsibility was traditionally limited to 'insiders' - you looked after members of your own immediate and perhaps your extended family, you might even extend some minimum care to members of your clan, or at most to members of your caste. Other 'outsiders' had no relationship to you, so their welfare was not your responsibility." This is a point of view that I have often encountered in literature as well as in discussions with interviewees in India.

However, what astonishes me is that, just as frequently, I come across the contention that, while Corporate Social Responsibility might be a new term in India, it is certainly not a new concept. Commonly given reasons for the prior existence of this notion are the Vedic tradition, Gandhis concept of trusteeship and the spread of philanthropy in India.

In the article to which I refer, you write that Indian "mythology has saintly or noble figures who cared for "complete outsiders", but their behaviour remained a remote ideal rather than everyday reality." and that in "a society bound by notions of caste and fate, the idea of responsibility for the whole of society constituted a cultural revolution caused by foreign influences. [...] Influenced by such foreign ideas, Indian reformers, such as Guru Nanak, Swaminarayana, Rammohan Roy, and Mahatma Gandhi in turn then launched reform movements which slowly began to change our values."

In considering these various claims, I wondered how to reconcile the notion of "traditional limitation of responsibility" with the contention that CSR is not a new concept.

I would be very grateful for any thoughts or insights you could share with me. I look forward to hearing from you.

Best regards,


Dear Ms H

Your questions are most interesting and reveal a depth of acquaintance with the literature about India, as well as depth of thought about my country.

1. The reason why one hears such astonishingly untrue statements as "CSR is not new in India" is because we Indians are a very proud people and don't like to admit that anything new has really come to India from abroad. According to us, everything was already known in the Vedas. In addition, we lack a historical sense. There are no explanations for quite simple questions to do with our history. The most elementary facts of our own history are not known to us, and we care for our history even less. For example, the Taj Mahal was being used as a stables when the British rescued it from that use. The reason for this lack of a historical sense may perhaps become clear to you if you read my short booklet on Indian Spirituality (attached), at least those pages which are on the history of the development of Indian spirituality (pages 5-15 in the attached version).

2. The fact is that the Vedas, however they may be interpreted today (and not many will interpret them to indicate any great social responsibility) were historically interpreted through the lens of caste as well as the practice of untouchability towards those of lower castes. Because of the always huge numbers involved, responsibility was always restricted to those with whom one had (and even today, has) the closest contacts and these are always members of your own family (and a limited close circle around that).

3. It is entirely true that, under reformers such as Mahatma Gandhi, a wider movement for national responsibility started in India. However, we must remember that these reformers were themselves influenced by Christian ideas of service and sacrifice (still referred to in India as the "missionary spirit") - for a full study of this, see Dr Vishal Mangalwadi's book, INDIA: THE GRAND EXPERIMENT, or M M Thomas's THE ACKNOWLEDGED CHRIST OF THE INDIAN RENAISSANCE. Those who practice philanthropy outside their own caste are, in technical terms, "un-Hindu" because they are breaking caste. Traditionally, we upper-caste Hindus would have had to go and bathe in the Ganges or perform other ritual ablutions if even the shadow of a lower-caste person fell on us (this was true throughout the country and with only a few exceptions till my generation, though this is now less and less true, particularly in the cities - read the novel, UNTOUCHABLE by Mulk Raj Anand, published in the 1930s, which perfectly captures the plight of the lower castes - which is still what exists in most villages specially in Central India. I hope to put related material on my website when my son gets around to completing it after his exams in a few weeks. As India has put traditional Hinduism behind it, it has progressed, just as China has progressed to the extent that it has put traditional Confucianism behind it, and Roman Catholic countries have progressed to the extent that they have put traditional Roman Catholicism behind them.

4. However, even at the time of struggle for independence from Britain, the number of people who followed Gandhiji were relatively small, and certainly the number of companies that backed Gandhiji were tiny - notably the Birlas and the Tatas (and we must remember that the Tatas are Parsis, not caste-oriented Hindus). Both the Birlas and the Tatas were rewarded, for their involvement in the the independence struggle, by means of lucrative licences and contracts, by post-independence Indian governments who created an oligopoly in a restricted market, which held back India's progress till the partial-reforms that are now helping the country to forge ahead. Fortunately for India, as well as for the Birlas and Tatas, businesspeople are adept are adjusting to new circumstances, and the business houses continue to flourish today.

5. Historically, it was the duty of my caste to make money and we were authorised (and in reality did) charge unlimited interest (or, to be more precise, as much interest as the market would bear), reducing tens of millions of people from other castes to bondage (virtual slavery) - something that, shamefully, still exists in parts of India.

6. Consider also that India is still one of the most corrupt countries in the world - and this corruption exists not only in politics but specifically in business. The Indian Stock Market is, regretfully, one of the least transparent and reliable in the world, and there are frequent scandals which are widely reported in the press, as well as other scandals which are not reported in the press but are public knowledge. Even though Indian shares are doing very well at present, I would not invest in most of the companies that are on the Exchange without inside knowledge of the individual company concerned (which is technically, in Western terms, illegal as well as immoral). However, portfolio investing in such companies is of course a different matter and can be less risky as well as more profitable. And I should say that there are a few individual companies whose accounts and statements I trust (including Infosys, Wipro, Tata Group, et al) - but these are a handful of islands in a sea of corruption. The relationship of this corruption to our spirituality is essential to understand. Our traditional spirituality related only to caste (dharma) and did not - and does not - have anything to do with morality in the Western sense. In fact, when an Indian becomes a "saint" he (usually "he") is considered to be beyond earthly things like morality. So he can indulge in the most immoral behaviour and still be accepted as a "holy man" - perhaps now you will understand why "gurus", such as Maharishi Mahesh Yogi and Osho, were and are able to retain their status as "gurus" in spite of doing what would be regarded as totally unethical things if done by normal, ordinary or average people, let alone by "saints". Christian priests and evangelists immediately lose credibility if they indulge in any immoral behaviour because the behaviour contradicts their beliefs, but immoral behaviour does not traditionally undo the reputation of Hindu "gurus" because their beliefs imply no earthly morality.

Does all this perhaps help to place in context why I said what I did in my article on CSR?

yours sincerely

pg Sphere: Related Content

1 comment:

DavidKong said...

Dear Professor Guptara,
I read with interest your reply to our fellow PhD student. I am myself from the Graduate Institute of Geneva. I am trying to get a hold of "Corporate Responsibility:
A View from India" by Navtej Dhillon and Amita Joshi and Ananya Chakravarti and EU-India CSR Network. Do you happen to know where I could acquire it? By any chance, would it be possible to get in touch with the authors?
Thank you in advance,
Best regards
David J. Kong Hug