Expectations increasing from Indian Corporates on CSR: Nielsen India Corporate Image Monitor 2008

A greater need for Corporate Social Responsibility (CSR) in India has brought companies who initiate and participate in CSR activities into the limelight and increased public expectations of them, according to the latest Nielsen India Corporate Image Monitor 2008, a study designed to measure people’s perceptions of the image and reputation of India’s leading companies.

Reliance Industries, Tata Motors and Tata Steel are the companies most admired by stakeholders for their CSR initiatives. CSR activities they are mostly associated with are: the Promotion of education – providing primary and higher education among adult and economically disadvantaged sections of society; Improving healthcare infrastructure in India - providing healthcare facilities in remote/rural areas (for example: free ambulance services etc.) along with the promotion of healthcare education: and the Promotion of environmental consciousness.

It is interesting to note that apart from the regular expectations in the fields of education, health, infrastructure, etc., from Corporates; 86 percent of stakeholders feel that countering terrorism should also be taken up by companies under their CSR activities.

“Public expectations of Corporations are on the increase as stakeholders see the significant impact they are having in various spheres, be it education, health infrastructure, environment conservation, etc. The public’s confidence in organizations undertaking socially beneficial projects is greater than their confidence in other channels that try to bring about positive social change,” said Vatsala Pant, Associate Director, Consumer Research, The Nielsen Company.

Building blocks of a company’s character

CSR is an effective way of building goodwill for a company. More than 50 percent of respondents felt that Corporates are honest towards their CSR activities. But the motive behind these activities is seen to be many, ranging from economic and tax benefits (47%), to enhanced corporate reputation (45%), or to build a competitive advantage (30%), etc.

28 percent of respondents thought that Charity, either directly or via NGOs is the best way to demonstrate social responsibility. Other ways of engaging in socially uplifting activities considered beneficial by stakeholders is a written CSR policy (24%), actively involving employees in CSR activities (20%), and community work and providing employment to needy groups (both 12%).

There is however a sceptical one-third of stakeholders who believes that CSR is publicity stunt for most Corporates.

Priorities and indulgence

According to the Nielsen India Corporate Image Monitor 2008, the top three social issues that stakeholders expect Corporates to tackle are Better health infrastructure (50%), Fighting diseases like HIV AIDS, Malaria, TB, Cancer and immunization programs (38%), and Primary, Higher education & adult literacy (30%). The Corporates are meeting the expectations of stakeholders on the top two social issues that are important to stakeholders but give more priority to Promotion of healthcare education (72%) than higher education & adult literacy.

Education & Adult literacy and Clean Drinking Water & Sanitation are some of the areas where Corporates need to step up activities versus expectations.

“Any education or other initiative to build health infrastructure will impact the CSR reputation of an organization significantly,” said Pant.

Environmental protection is now a hygiene expectation from organizations. It is deemed mandatory for any organization that aims to gain the confidence of its stakeholders and be recognized as a socially responsible company to be sensitive to environmental issues and take steps not to endanger it through its activities. Only 13 percent of respondents expect Corporates to undertake environmental protection as a CSR activity, it is a given that they will do so.

“It is interesting to note that seven out of ten members of the general public are willing to pay a premium for products and services to enable a company to fulfil its CSR commitments. Considering the impact of CSR activities on a company’s reputation, organizations will have to plot a developmental path for CSR integrating it with the rest of the business,” continued Pant.

Some initiatives that are not spoken of openly but have potential to yield big returns on reputation are rehabilitation (especially in times of natural disasters) and building of infrastructure (building roads/ maintaining properties etc.).

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About The Nielsen Company

The Nielsen Company is a global information and media company with leading market positions in marketing and consumer information, television and other media measurement, online intelligence, mobile measurement, trade shows and business publications (Billboard, The Hollywood Reporter, Adweek). The privately held company is active in more than 100 countries, with headquarters in New York, USA. For more information, please visit, www.nielsen.com.

About Corporate Image Monitor

The Nielsen Corporate Image Monitor is an annual syndicated study conducted by The Nielsen Company. It is designed to track the reputation of the leading Indian companies and provides actionable insights that help companies build their corporate brand. In its ninth year, the Corporate Image Monitor covers the top private sector companies of India across industries. The selection of companies for the survey is based on - Market Capitalization, Sales & Assets. Taking a simple average, a single score is calculated for each company and top 27 companies were selected. Nielsen Corporate Image Monitor 2008 represents the views of 1800 people from different walks of life across the top seven metros. These stakeholders range from general public to media and policy makers.