Historically, all significant mercantile communities were great patrons of the practice of philanthropy. They viewed it as a sacred custom. In Bangladesh, businesses are also starting to understand the value of altruism more and more. As a result, a lot of money has been going into the social sector.
In the West, one widely accepted golden rule of CSR is that it must be tightly integrated with a company's business strategy so that the programs produce a shared value for the company's shareholders. That is however not the case in Bangladesh. Instead, the goal is limited to improving societal welfare.
Moreover, the CSR agendas of a majority of corporations in Bangladesh appear to have a variety of secondary goals. They frequently use CSR to raise their social profile and expand their clientele. This noble philosophy has suffered from such a lack of well-intentioned commitment.
From a CSR perspective, businesses are seen as corporate citizens with moral and social obligations, similar to individual citizens. They must devote time, talent, and resources to society's well-being. It encourages businesses to incorporate environmental and social issues into their daily operations. CSR is now acknowledged as crucial to an organisation's operating ethos, business strategies, and purpose.
CSR is widely regarded as a tool for striking a balance between economic, environmental, and social imperatives, while meeting the expectations of shareholders and other stakeholders. Customers, suppliers, employees, communities, and financiers (shareholders, bondholders, banks, and other sources of capital) are all stakeholders in the global economy. The goal of CSR is to manage a business in a way that promotes sustainable development by benefiting all stakeholders. It encompasses topics like corporate governance, health and safety, working conditions, environmental effects, and the impact on economic development.
Globally, a fresh batch of wealthy donors is emerging now, who are upending philanthropic norms that have been in place for a long time. These are people who have a problem-solving and impact-making mindset, in addition to being more open to tackling contentious social and political issues.
Financial and social metrics are used to evaluate companies. CSR is also associated with the idea of triple-bottom-line reporting (financial, social, and environmental), which serves as a framework for evaluating an organisation's performance on economic, social, and environmental factors.
A profound shift in individual and societal attitudes can be seen in how business leadership has acknowledged the need for expanded corporate responsibility. Before the advent of CSR, communities were instead forced to accept well-intended but ineffective programs. Favoured groups received cheques that were frequently not accompanied with support.
Progressive businesses today hold extensive discussions and plans with governments, non-governmental organisations, and communities to advance a broader and deeper agenda.
The laws that apply to businesses, the Code of Corporate Governance published by the Bangladesh Securities and Exchange Commission (BSEC), do not require businesses in Bangladesh to make CSR contributions. Since moral obligations must be instilled rather than imposed, legislating them is difficult anyways.
Laws can establish the minimum requirements, but they cannot produce the conditions or atmosphere necessary for a philanthropic mindset. CSR is more socially relevant when it is motivated by altruistic goals, as opposed to being a mandated policy commanding philanthropy.
Most organisations in Bangladesh have historically treated CSR as an afterthought that does not permeate daily operations. Furthermore, it isn't always accountable or focused on the mission. It might be employed to improve the reputation of the brand, offer a moral shield to cover up dishonourable public behaviour, or cover up sinister deeds.
Bangladeshi businesses often attempt to present CSR as a business discipline, expecting every initiative to have a positive impact on the bottom line. That puts too much pressure on CSR and deviates from what ought to be its primary objective, which is to connect a company's social and environmental initiatives with its corporate mission and core values.
It is acceptable to engage in CSR activities to improve reputation, reduce risks, and contribute to business outcomes. But these should be a side effect and not the main goal.
According to studies, corporate leaders tend to favour causes located close to their corporate headquarters. As a result, more isolated areas with a dire need for development assistance are disregarded. Politics can also skew priorities, causing businesses to fund government-led projects to curry favour with politicians, rather than launch more socially relevant projects that require funding.
There are sometimes conditions attached to a sizable portion of all CSR spending. A few clauses specify the precise location and application of funds. This may be appropriate in some circumstances, but it shows a serious lack of faith in nonprofit organisations and makes it difficult for them to function efficiently.
The requirement for fostering CSR values in employees is a more crucial CSR aspect that requires greater attention. The true advantages of CSR can only be realised when employees align their social philosophy with that of their employers.
In the long run, a charity carried out sincerely and honestly always reap rich rewards. We would do well to recall Henry Ford's maxim: "A business devoted to service will have only one worry about profits: they will be embarrassingly large."
SK Shamim Iqbal is a faculty member at SIBL Training Institute.