How two different ‘species’ Corporates and NGOs could work together in the ecosystem of the new Company Act of India? This dilemma exists at both ends. The corporates aren’t sure whether they will get a genuine NGO partner to implement their ideas and NGOs are worried that their credibility will be at stake, if they partner with a wrong corporate. The amount of mistrust is tremendous. No wonder, every corporate, therefore creates their own foundations to implement CSR activities while there are around 3.3 million NGOs already existing in India!
Additionally I believe they are strongly influenced by 4Ps, differently though; Passion, Practicality, Profits and Public good. NGOs are usually driven by high octane of passion for public good and sometimes ignore Practicality in their operations. They choose to make decisions through the heart. On other hand, corporations are Passionately driven by Profits and manage their operations with acute Practicality and largely think from the brain. Thus it becomes difficult for either of them to understand each other. Yet they are two sides of the same coin, one who runs the country’s economy through profits and other who ensures that the people and planet are take care of…finally contributing to the triple bottom line.
The Company Act 2013 which came into force on 1 April 2014 has made Corporate Social Responsibility (CSR) legally binding with a mandate which is first of its kind in the world. As reported, there will be around 16000 companies in India who will be spending 2% of PAT (profit after tax) as CSR, amounting to approx. 3 billion USD annually. CSR is now seen as ethical and smart way to conduct business, making corporate entities into socially responsible organizations, visibly contributing to the social good. Such business regulations in India have already created a platform for NGOs to play a part in creating shared value, by recommending, the implementation of CSR projects through NGOs and development sector agencies. In this context, it is essential that NGOs understand the CSR landscape in India. After decades, CSR has created a new world of opportunities for the Indian youth and experts say that there will be requirement of more than 1,00,000 CSR trained professionals across the country. I guess for instant CSR managers, corporates need to look at the NGO sector rather at management institutions who may take atleast two more years to bring out degree qualified CSR managers who will be still no match to rich experiences of NGO professionals of the country. Why reinvent a wheel when there exists several of them?
So the question arises, whether CSR funds will be available for NGOs? Whether NGOs are ready to avail CSR funds? At various CSR forums that I attended, I witnessed good amount of bashing of NGOs. The business people finds NGO sector largely fake, incompetent, unaccountable and disorganized. Some people have thrown figures off their hat at me “ you know of the 3.3 million NGOs that exists today, half of them are nonexistent and fake, of the remaining, half are corrupt, still quarter of rest are compromised and say around 5% might be genuine and really doing good work”. As you could see there is no research to support these figures because the fact is true, till to date, the NGO sector in India largely remains unorganized. No one thought of building a consortium, to guide, mentor and bring in best practices into the sector.
Funds scarcity and sustainability issues has made every NGO an island in itself and no two islands want to meet nor wants to build a bridge. They are so divided among themselves that I can understand how bewildered the corporate world would be, while looking at this ocean of 3.3 million islands, it must be very difficult for them to pick and choose. They are unsure which of these islands might be sinking ones, who are having a solid rock foundation upto the ocean floor and who are mobile islands that move as per the tides and do not have a direction.
Yet in an historic moment, the Govt.of India decided to support the NGO sector by making them partners in the country’s development through CSR. This reflects, the government’s belief in voluntary sector as there has been good work done by this sector and for long rather, the world’s second oldest NGO – BNHS, still flourishes in India after its existence of 131 years protecting India’s unique biodiversity! Likewise in any sector, absolute integrity is an impractical expectation, why NGOs are expected to play saint when it is also driven by human beings. Today our NGOs need more of capacity development in managing themselves rather funds, the CSR addresses this need too and it is expected the corporates come forward to empower their NGO partners.
I still do not understand why more and more high-end CSR workshops are being held across by the corporates, of the corporates and for the corporates. What’s the point when NGO representatives are missing from the panel and the audience. Why not hold free workshops and educate the NGO sector who will be the key player in the implementation of CSR strategy? Why not involve NGO leaders in developing CSR projects and programmes? If this happens then the madness of tree plantation will be replaced by habitat restoration or forest protection.
NGOs are grassroot workers and corporates aren't, this difference will be there and it should be retained. Like mixed hunting parties among the birds who operate at different canopy levels so that everybody gets food while the ground dwelling birds are flushing out insects in search of seeds and fruits. Thus the government, corporations and civil society should operate at different canopy level and get rid of issues marring the country’s growth.
Many industrialists might disagree but the CSR sun has risen on the NGO horizon and even before the next amendment comes through which I am confident, the NGO sector by then, will be basking in the bright sunlight, brightening up the world they touch upon.