Politics, Ethics and Social Responsibility of Business

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CORPORATE PHILANTHROPY |

19.5.2.2 Birla Group

Krishna Kumar Birla, son of the founding father of the Birla Group, Ghanshyam Das Birla, was among the

founder members of the Indian sugar industry which he joined in 1940. Birla had established one of the

India’s biggest business conglomerates and his industrial empire spans key industries such as sugar, fertilisers,

chemicals, heavy engineering, textiles, shipping and newspaper. He was a respected parliamentarian, socialite,

philanthropist and scholar apart from being an industrialist.

He established the K.K. Birla Foundation, which has instituted annual awards for excellence in Indian

literature, scientif c research and Indian philosophy. K.K. Birla, popularly known as K.K. Babu, was a builder

of modern institutions, ranging from industry to education, one of the famous symbols of which is the Birla

Institute of Technology and Science at Pilani, Rajasthan, his birthplace.

He built Radha-Krishna Temple (popularly known as Birla Temple) here and many other institutions all

over the country that enriched the fabric of Indian society.

The A.V. Birla Group has been contributing to the poor and marginalised people in and around its plants

across India for the past 50 years. In the earlier days, the group used to dole out money as charity. However,

the late Aditya Birla felt that giving money to the poor is not the long-term solution and felt that social

projects should be self-sustainable in the long run.

19.5.2.3 Infosys

Infosys, formed in 1981 by NR Narayana Murthy, follows a socially responsible and sustainable path in

conducting business. Even during the booming time of the 1990s when the stock prices of IT companies were

skyrocketing, the company believed in sharing the wealth with the society and its employees. This practice of

the company stems from the personal belief of Narayana Murthy to give back to the society more than what

it gave him. It also substantiates the role and motivation of the CEO and the top management in making the

company a responsible corporation.

Murthy is of the belief that corporations have to show fairness in dealing with employees to retain them;

corporations should ensure transparent disclosures to investors to attract global capital; ensure customer

satisfaction to win conf dence and must ensure fair dealings with their supply chains; and should be ethical

to government by paying all taxes. Infosys has won many awards such as Best Employers to Work for in

India, Golden Peacock Award for Excellence in Corporate Governance in the Global Category by the World

Council for Corporate Governance, London and Corporate ship Award by The Economic Times .

A strong sense of social responsibility is foremost among the core values of Infosys that translates into a

commitment to help people and communities, enhance living conditions and improve education. The social

consciousness is included in the strategic plan of the company and serves as a guideline for the management

to help in decision making. The Infosys Foundation was formed to focus on health care, primary education,

social rehabilitation and rural upliftment and promote art and culture. Sudha Murthy (wife of Narayana

Murthy), chairperson of the foundation, is taking a leadership role in inf uencing corporate India to discharge

their social responsibilities besides focusing on prof t generation. The Foundation began its activities in

Karnataka in 1996. Today the activities have extended to Tamil Nadu, Andhra Pradesh, Maharashtra, Orissa

and Punjab. According to a recent report, Infosys spends about Rs. 50 million on social activities.

19.6 CONCLUSION

The above efforts by the corporates, towards philanthropy, are only a part of a loose concept of ‘corporate

social responsibility’ as has been practised in the past. A company would be truly a responsible when it has

developed a framework for being responsible towards the people, planet and prof t. A responsible corporation

must cater proactively to majority stakeholders if not all. Any attempt to further philanthropy should ultimately

be directed towards CSR. In this era, pure philanthropy cannot be justif ed when companies face such an

overburden of corporate responsibility.