CSR as an instrument for Stakeholder Engagement

Disclaimer: The views of this opinion piece is solely from the author and not necessarily the view of the company.

A recent site visit to our client’s operations had our team exploring the perceptions and dynamics of company vs community, plus the role of CSR activities within stakeholder engagements. As I sat down to list the activities a company narrated, including building temples, a few randomly placed street lamps – I wondered if these activities had any impact or remotely enough? Shouldn’t the company want to spend money on better activities such as sanitation or education?  I shared my concerns with a colleague. The hour and something discussion had a significant learning curve in my understanding of CSR activities as a stakeholder engagement tool. The course of the discussion are shared below:

What makes a CSR Activity impactful?

Two ingredients that makes any activity impactful – how much? ( the quantity) and how well? (the quality). How many livelihoods have been transformed? Has it impacted a day-to-day chore? – Of course this is a simplistic empirical formula for impact in general. Companies cannot just use CSR as a magic wand and expect a grateful response from the community. There involves the more subtle untold step – set a foundation of trust and understanding. This encompasses 1. Listen to the community: establishing a common ‘need’ within the community  2. Gain Trust : communities react differently to the induction of something new, understand in increments what these reactions/ concerns are and reassure the people – not just the influential village heads.

Executing a CSR activity that is impactful vs meeting a demand

Aan interesting role play soon ensued. When seated as representative of a ‘community’ affected by the presence of a company, the same list of activities were seen in different light. For instance, as a community, I may have asked for a street lamps, which I perceive to be an asset for my community and affected my daily chores, but if the company offers me a primary education school – would I value it more? I don’t think so, not necessarily. I think it would be seen as – asked me something, offered me another. So would I (read as a rep for community for this para), really value and use the primary school effectively? Would I care if it doesn’t run? – Maybe not. I would certainly be happier with the street lamps and would consider notifying someone if the street lamps didn’t work. This right here is why the effort carried out by a company, gets lost during implementation. For a programme to be effective  or ‘impactful’, organisations are dependent on the villages to see value in it. Value is recognized when demand is met. Simply put: meet demand, gain value, see impact.

So are liaison agreements with communities = CSR activities?

Short answer : No.

Long answer: It is crucial to carry out initiatives, communities have voiced through your liaisoning/ stakeholder engagement (prior or during your setup), to gain mutual trust and understanding from the community your company affects. However, kindly note that while the activities are funded from the CSR budget and affects the community, it cannot be slated as the CSR activities for the year. They should be seen as a liasoning requirement. At the most, the first step towards establishing CSR activities.

Once the community recognizes that the company has a record of carries out activities that are voiced by them, there is a foundation of trust and understanding that whatever (within reason) the company chooses to carry out thereafter would be taken with less resistance; Increasing the chances of an impactful CSR activity.

Inclusion, while building temples and randomly placed street lamps are important to ascertain trust, companies must graduate to a more robust and impactful CSR agenda- one that can be published without wondering the relevance of it.


Keerti Krishnan

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