A new model for companies to choose CSR activity and thereby creating a competitive advantage.

1. STRATEGY AND
SOCIETY
THE LINK BETWEEN COMPETITIVE ADVANTAGE AND CORPORATE SOCIAL RESPONSIBILITY

2. THE ISSUE OF CSR VS BUSINESS PERFORMANCE HAS BEEN A
LONGSTANDING DEBATE
Key
Questions
Are corporates responsible for social consequences of
their activities?
Are business and society interdependent ?
Prevailing approaches to CSR too generic?
Is there a framework to evaluate the effects companies
have on society?
Can CSR be more that a cost, a constraint, or a
charitable deed?

3. EMERGENCE OF CORPORATE SOCIAL RESPONSIBILITY
Not always
voluntary
Focuses on tension between business and society rather than on their
interdependence- complete disconnect form company’s strategy
Corporate’s
approach
Focuses on tension between business and society rather than on their
interdependence- complete disconnect form company’s strategy
Moral
Obligation.
Sustainability.
License to
Operate.
Reputation
Ex: honesty in filing financial statement.
Cannot weigh social benefit against financial cost,
Ex: moral principles cant tell pharmaceutical companies where to allocate resources to develop cures for
future
Ex: McDonald's new practices to wrap its food.
It is very vague,
Ex: transparency may be more sustainable than corruption & good employment practices can be very
sustainable
Ex: chemical company having license to operate.
But these are short term,
Ex: forbearance of their neighbor may be short lived
Ex: Energy company’s social responsibilities in form of insurance.
Company rarely finds the strategic benefit that it is seeking, leading to high profile cause related marketing
campaigns, of crisis there would still be public criticism
Ex: in event

4. INTEGRATING BUSINESS AND SOCIETY
(PORTER AND KRAMER’S THEORY)
Large level of
Interdependence between
Business and Society
• Successful corporations need a healthy society
• And healthy societies needs successful companies
Value Chain impact on CSR
Activities
• Every aspect of a company’s value chain comes in contact with the
society either in a positive or negative manner.
• A company can strategise its CSR through mapping its value chain touch
points on society
Both business decisions and social policies must follow the
principle of shared value creation
Inside
Out
Activities in the Firm’s Value Chain
Outside
In
Competitive context for firms
*Bajaj Auto is a great example of this as it has been able to create shared value through its women and
people empowerment programs (Inside Out) and its Rural development projects (Outside in)

5. MAPPING COMPANY VALUE CHAIN TO CSR: LOOKING INSIDE
Support
Activities
Firm Infrastructure
Human Resource Management
Technology Development
Primary
Activities
Procurement
Emissions,
Congestion,
Accident
Inbound
Logistics
Operation
s
Biodiversity impact,
Energy & Water
Waste
Outboun
d
Logistics
Marketing
and sales
Transport
Impacts, Improper
packaging
After
Sales
Service
Pricing , False
Advertisement
s
Disposal of Obsolete
Products, Customer
Privacy

6. MAPPING THE DIAMOND TO CSR: LOOKING OUTSIDE
*Availability of Human Resources
*Access to research Institutions and
universities
* Efficient Physical Infrastructure
Context for Firm
Strategy and
Rivalry
Related and
Supporting
Industries
*Availability of Ancillary Industries
*Presence of Clusters
*Presence of Related Firms
*Fair Competition (absence of trade
barriers)
*IP Protection
Transparency (Financial Reporting)
Rule of law
Local Demand
Conditions
Factor
Conditions
*Sophistication of Local Demand
*Regulatory Standards
*Unusual Local needs that can be
served nationally

7. CHOOSING WHICH SOCIAL ISSUES TO ADDRESS
Generic Social Issues
• Social Issues that
are not significantly
by a company’s
operations
• Has no material
effect on long term
competitiveness
Value Chain Social
Impacts
Social Dimensions of
Competitive Context
• Social issues that
are significantly
affected by a
company’s activities
• Touch points
between society and
value chain
• Social issues in the
external
environment that
significantly affect
drivers of
competitiveness
• Effects are generally
long term

8. CHOICE OF SOCIAL ISSUES: APPROACH
Carbon
Emission
AIDS pandemic in
Africa
Supporting a
Dance Company
Financial Institution
Eg. Bank
Retailer
Eg. Walmart
Value chain
social impact
Automobile
manufacturer
Eg. Toyota
Competitive
context
Transport base
company Eg. UPS
Pharmaceutical
company
Eg. Glaxo Smith
Kline
Mining company.
Eg. Anglo American
Electricity Supply
Company Eg.
Edison
An Arts, Music and
Craft promoting
company
Generic Issues
Credit company
American Express
Promoting
Vocational
Education
Telecom Major
Eg. Bharti Airtel
Information
Technology
Services Firm Eg.
HCL tech
Tyre Company
Eg. MRF Tyres
• These choices will vary from industry to industry , Among SBU’s, and among locations. Eg. Volvo safety
vs Toyota Environment
• Need to Integrate All three objectives. Example. ITC e-Choupal

9. CREATING A CORPORATE SOCIAL AGENDA
An Affirmative Corporate Social Agenda moves from mitigating harm to reinforcing corporate
strategy through social progress
Responsive
CSR
Company Corporate Citizenship
Reduce/mitigate Value chain causes of Harm
Strategic CSR
Strategic Social efforts that leverage company capability to improve competitive
context
Transform value chain activities to benefit society while reinforcing strategy
Good Citizenship
Responsive
CSR
Mitigate vale
chain activities
causing harm
Strategic Social
efforts that
leverage company
capability
Transform value
chain to benefit
society
Strategic CSR

10. CREATING A SOCIAL DIMENSION TO THE VALUE PROPOSITION
Unique Value
Proposition
Lies at the heart of every strategy. A set of needs that only the
company can meet
The Most Strategic CSR occurs when a company adds
a social dimension to its value proposition
Whole Foods Market
Unique Value
Proposition
Sell, Organic, natural and healthy food products to customers who
are passionate about food and the environment
Social Dimension
*Critical analysis of procured ingredients to weed out unhealthy or
environmentally damaged ones
*Use of Unbleached and Unbromated Flour
*Use of Environment Friendly energy
*Turning Bio-Degradable waste into Biofeuls

11. THANK YOU