Tag: Corporate Social Responsibility
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The Social Cost of Corporations
[Posted by Umakanth Varottil] Recent events, both in India and elsewhere, have thrown the spotlight on the roles and responsibilities of companies in society. In an interesting article “The Conscience of Capitalism” in Forbes India, Arun Maira discusses (in a non-technical fashion) the difficulties in pinning responsibility for wrongdoing by a company. Pertinently, he notes…
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Mutual Funds as Activist Investors
[Posted by Umakanth Varottil] On several occasions, discussions on this Blog have pointed to the inadequacy of shareholder activism (spearheaded by institutional investors) in India, and have therefore called for greater participation of institutional investors in governance processes. A circular issued by SEBI on March 15, 2010 addressed to mutual funds and asset management companies…
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Inculcating Business Ethics
[Posted by Umakanth Varottil] Following the financial crisis, there has been a reconsideration of the manner in which business schools have been imparting education. Questions are being raised as to whether alternate methods of business education could have modified some of the ethical and behavioural traits that may have fuelled the crisis. In this scenario,…
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Voluntary Guidelines on Governance and Social Responsibility
[Posted by Umakanth Varottil] Corporate Governance Earlier this month, we had highlighted the recommendations of the CII Task Force and the Institute of Companies Secretaries of India seeking reforms to the existing regime for corporate governance in India. Shortly thereafter, and based on various other suggestions received, the Ministry of Corporate Affairs has published the…
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Climate Change and Corporations
[Posted by Umakanth Varottil] Ultimately, when it comes to corporations, incentives seem to matter a whole lot, with one key incentive being the profitability (or avoidance of loss) of any action to shareholders. In his column in the New York Times, Paul Krugman notes: Action on climate, if it happens, will take the form of…
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Some Literature on Governance and Social Responsibility
[Posted by Umakanth Varottil] Professor Balasubramanian of IIM Bangalore has posted two interesting papers. In the first paper, Addressing Some Inherent Challenges to Good Corporate Governance, he examines certain specific issues arising due to the concentrated ownership in Indian listed companies. Specifically, he notes: While the objectives of good governance, namely creation, protection and equitable…
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UN Corporate Law Tools project: Corporate Structures and Governance and Human Rights
[Posted by Mihir Naniwadekar] The United Nations has been developing a project on Reports on Corporate Law Tools, which involves leading law firms from across the globe working with UN Special Representative John Ruggie to analyse how corporate structures in different legal systems foster respect for human rights. The idea behind the project is found…
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CSR in India: Some Theory and Practice
[Posted by Umakanth Varottil] Experts in the area of corporate social responsibility (CSR) have argued that CSR is not just philanthropy by companies. It should involve the right combination of enhancing long-term shareholder value and protecting the interests of various other stakeholders (such as employees, creditors, consumers and the society in general). In a recent…
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Environmental, Social and Corporate Governance (ESG) Factors
[Posted by Umakanth Varottil] While examining issues pertaining to corporate governance, a myopic approach is to look at the interest of the shareholders, whose interests are to be protected. On the other hand, there is a school of thought, known as the “stakeholder” approach, which calls for governance of companies with a view to protecting…
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Promoting ‘Inclusive Capitalism’ in India
[Posted by Umakanth Varottil] The latest issue of IndiaKnowledge@Wharton carries an article on the concept of ‘inclusive capitalism’ and its effect on India. It also considers prospects for the future. The article discusses some examples where inclusive capitalism has been implemented. It begins with a study of Fabindia Overseas, and then moves on to discuss…