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CORPORATE SOCIAL RESPONSIBILITY – A CASE STUDY OF
TATA MOTORS
Jaspreet Singh1, Dr. Jaskaran Singh Dhillon2, Dr.Dharminder Singh Ubha3
1
Research Scholar, I.K.G.P.T.U., Jalandhar (PB.) India.
2
Professor, S.G.G.S.World University, Fatehgarh Sahib (PB.) India.
3
Principal, G.S.S.D.G.S. Khalsa College, Patiala (PB.) India.
Abstract the firm and are affected by the firm’s decisions.
Tata Motors formerly known as TELCO The shareholders being one of the constituencies
(Tata Engineering and Locomotive of stakeholders should actively participate in the
Company) is an Indian multinational decision making process of implementing CSR
automotive manufacturing company programs, while the firm should ensure the
established in 1945 by Tata group. Tata continuity of their contribution through
Motors is India’s largest automobile commitment to pay dividends and increase share
company. Different Tata companies have value (Ramesh & Goel, 2012).
been actively involved in various social One of the areas of Corporate Social
activities and Tata Motors is doing social Responsibility research which remain untouched
work since its existence. Corporate Social in the competitive country like India is the role of
Responsibility is becoming an important CSR in family operated business. Large numbers
activity to businesses nationally and of companies are running business these days but
internationally. In the light of this very small numbers of companies are spending
background, the objective of the study is to amount on CSR activities in education. Tata
analyse the Corporate Social Responsibility Group is among the best companies in India. The
activities performed by Tata Motors from Tata group is operated by Tata family since its
2009 to 2015 towards activity as specified in establishment.
Schedule VII to the 2013 Act. The history of Tata group springs from a small
Key words: Corporate social responsibility, trading company established in 1868. Since then,
rural areas, Tata, Tata Motors the business has evolved into a well-established
company with a wide distribution network and
Introduction wholesale operations. He was the only son of
The globalization of the economy and the Nusserwanji Tata, a Parsi family of the close-knit
emergence of a boundary-less environment, make Zoroastrian community. He was working in his
such a phenomenon even more dramatic. father’s banking firm and established a trading
Companies are more and more scrutinized and put company. In 1887 Jamsetji Tata formed a
under pressure by consumers associations and partnership firm, Tata & Sons with cousin
political lobbies (Ramesh & Goel, 2012).The Ratanji Dadabhoy Tata and his elder son Sir
main motive of CSR is to define a social contract Dorabji Tata, Rattan Tata, this was the start of
to maximize the welfare of all the concerned the core business. This start-up could be
parties. Welfare maximization should be described as entrepreneurship, changed to
considered as both short term and long term, in partnership and become family links between the
order to meet present expectations and needs brothers and son played a considerable role in the
without endangering the opportunities and the start-up. Tata Motors was started by Tata group
resources of the coming generations (Ramesh & in 1945 by this group.
Goel, 2012).The stakeholders of the organization This study deal with the areas in which the CSR
contribute to firm’s activities, and have a stake in work has been done by Tata Motors company.
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34INTERNATIONAL JOURNAL OF CURRENT ENGINEERING AND SCIENTIFIC RESEARCH (IJCESR)
The areas of CSR activities given in the schedule responsibilities programmes perfo rmed by
VII of the companies Act 2013 is taken as a base various companies like Tata group of companies
to undertake the study. These areas include extended a wide spectrum including rural
poverty & hunger eradication, education, women development, community development and
empowerment, child mortality, health, social welfare, family initiatives, tribal
environmental sustainability, vocational skills, development and water management. The study
social projects, contribution to funds and others. analysed the different drivers of CSR by using a
The study is done year wise from 2009 to 2015. comparative diagram and analysed the areas of
Each year of study is taken in tabular form to CSR addressed in corporate policies of
bring a more reliable result out of it. For the companies.
purposes of this item, the term slum area shall
mean any area declared as such by the Central Zhang (2008) gave an overview of the issues
Government or any State Government or any surrounding CSR that should be kept in mind
other competent authority under any law for the while discussing the emerging markets. The
time being in force. study was to frame the background of CSR in
emerging markets, inform the actual seminars
Review of Literature and prepare points for debate throughout the
Ranganathan (2003) attempted to describe CSR course of the project and to find this the project
practices in Tata group. It also reiterated need for with Foreign Policy Centre in association with
replication of the Tata model on holistic Coca-Cola Great Britain was launched. The
development through CSR from its inception to study examined the impact of MNCs’ businesses
till date. The study discussed the people who led on the workplace, the marketplace, and the
their visionary leadership spearheaded the Tata environment, and explored how well-designed
group and the core values of the Tata Group CSR practices could contribute to economic,
which was to improve the quality of life of the social, and environmental progress in emerging
communities it served and Social Initiatives of economies. In case of workplace, the study
the Tata Group. The study discussed the Tata undertook Nike, Coca - Cola Company.
Index for sustainable human development However, in marketplace an example of HLL
prepared by TCCI to benchmark the and Unilever and Vodafone was considered and
contributions of Tata companies towards social in case of environment, Atlantic operating in
development and protection of the environment. aviation and general motors a leading company
The study also reiterated need for replication of in automobile industry was considered.
the Tata Model on holistic development through
CSR. It was concluded that Tata group was Tomar & Gupta (2008) examined the way,
performing CSR activities not for propaganda or reasons and to what extent corporate social
visibility but they were doing it wilfully. responsibility was being implemented in leading
family owned businesses in India. The study
Prema & Singla (2003) highlighted the lessons aimed to develop a framework that integrated the
from India which were relevant to businesses intention and the concern of an organization
seek endorsement as good corporate citizens towards corporate social responsibility and the
through corporate social responsibility degree to which these activities were operational.
initiatives. The researchers saw repercussions in The study addressed the two key challenges in
various companies of the world out of which social responsibility management i.e. firstly how
India had also seen some repercussions. In India, to measure corporate social performance and
it was traditionally linked to spirituality while secondly what capabilities an organization
respect in the corporate world was treated on a should have to be socially responsible. The
par with the bottom line. The research inferred research found the impact of the philosophy of
that the CEO’s reputation was a key factor in a Tata family on CSR policies and practices of
company’s reputation. Respect was considered TISCO. Tata Steel provided many examples of
an intrinsic part of Indian culture. The study also how business-community relations were
discussed the criteria for ranking India’s most approached by the private sector in India in the
respected companies and corporate social present time. Tata Steel also commenced
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35INTERNATIONAL JOURNAL OF CURRENT ENGINEERING AND SCIENTIFIC RESEARCH (IJCESR)
employee volunteering whereby employees were could be understood in isolation from contextual
not only made aware and communicated factors. The ensuing comparative analysis based
properly but also participated actively in CSR on QCA gave a concise illustration of the
activities. importance of context when trying to capture the
Norhayah, Haslida, Zakiah & Dalilawati (2009) mechanisms behind a company’s CSR
tried to explore CSR in family business in engagement. The study suggested that CSR
Malaysia, in terms of firm practices towards CSR strategies could not necessarily be transferred
and disclosures of information related to CSR. successfully from one company to another
The research explored the approach of the family irrespective of context.
businesses in responding towards CSR. The Jedrzej & Frynas (2009) analysed CSR’s
study presented the first phase of the research, potential and limitations for contributing towards
which included CSR initiatives and activities of wider societal challenges. The article
the family businesses. A multiple-case study investigated the key areas of CSR policies where
consisting of five Malaysian family businesses oil companies were expected to make a positive
those topped on board of listed companies in contribution, improvements in environmental
2009 was conducted in Malaysia. Of the five performance, development and governance. It
companies, one company engaged in commercial was the culmination of more than 10 years of
and retail banking and its related subsidiaries; researching the oil and gas sector and the author
two companies involved in plantation, one had 100s of conversations with oil company
company was into investment holding and staff, civil society advocates, government
management while the fifth company engaged in officials, consultants, development specialists,
power investments and energy market. Only one journalists and local people around these issues.
company was chaired by Malaysia while the In addition to interviews with oil company staff
other companies were chaired by Chinese. The and insiders, the findings were based on the
study provided the information on the current analysis of 20 social and environmental reports
practices of family businesses in Malaysia of selected oil and gas companies. The evidence
towards CSR. The findings had some policy suggested that CSR had the greatest potential for
implications on disclosure requirements related addressing environmental challenges. Corporate
to disclosure of CSR and on drafting incentives reporting on the environment was steadily
from government and its institutions to promote improving, new environmentally friendly
greater CSR amongst family businesses and technologies were being developed and tangible
provided a basis for further suggestion on how improvements were being made by some
companies could contribute to the society and companies. The limitations of CSR did not imply
environment through CSR. that oil companies should do nothing about
Gjolberg (2009) explored the relative importance societal issues. Firms were pressured to engage
of global forces and national political economic with the social and environmental aspects of
institutions for companies’ willingness and their operations and they might benefit from the
ability to engage in corporate social opportunities that CSR offers.
responsibility. The globalist hypothesis Reinhardt & Stavins (2010) examined the
postulated that a company’s CSR efforts were a concept of firms sacrificing profits in the social
function of the dictates of the global market interest within the environmental realm, with
place: strong anti-globalization and anti- particular focus on the case of the United States.
corporate sentiments generated a need for a Their starting point for examining the first
positive reputation to obtain a ‘social license to question was the prevailing view among
operate’. The institutionalist hypothesis economists and business scholars that corporate
postulated that a company’s CSR efforts were a directors had a fiduciary duty to maximize
function of institutional factors in the national profits for shareholders.US corporate law was
political-economic system: companies based in consistent with the shareholder primacy model,
political economic systems with strong but as long as managers claimed some plausible
institutions for social embedding of the economy connection to future profitability, the business
had comparative institutional advantages for judgement rule granted them the way to commit
success in CSR. The study concluded that CSR corporate resources to projects that benefit the
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36INTERNATIONAL JOURNAL OF CURRENT ENGINEERING AND SCIENTIFIC RESEARCH (IJCESR)
public. The process of economic survival of the Scope of the study
fittest suggested that firms which engaged in The study is based on secondary data which was
unsustainable CSR found themselves being extracted from various published sources like
pushed out of business. The study revealed that annual reports, sustainability report various
the firms that engaged in CSR were often active business magazines, journals newspapers &
in markets that were imperfect or distorted by other relevant private and public publications.
government intervention, so that they were The values of variables considered for the study
protected from Friedman’s evolutionary were taken as the values that existed as on 31st
imperatives. Secondly, principal–agent problems March every year during a period 2009-2015.
led managers to make decisions that commited The sample size of the study is restricted to Tata
the firm to short-term CSR actions, even if those Motors and was selected as per non-probabilistic
activities would not be continued in the long run. convenience sampling.
The study suggested that most firms view
socially responsible actions in the same way that Limitations of the Study
they viewed more traditional business activities. 1. The CSR activities towards other
Instead of altruistically sacrificing profits, they important internal stakeholders such as
engaged in a more limited but more profitable set investors have not been covered. Some
of socially beneficial activities that contributed external stakeholders such as civil
to their financial goals. society groups, other companies are also
3.1 Importance of the study not part of the study.
It is apparent from the literature that CSR plays 2. The activities performed once are
an indispensable role in the development of a sometimes not repeated next year which
country. The study endeavoured to study the result in demoralization of the
work done by Tata Motors. CSR came into light beneficiaries who are working for these
in India with the coming up of voluntary activities or one getting benefit of these
guidelines on CSR in 2009, voluntary guidelines activities.
on CSR got revised in 2011 and later on became 3. One of the major limitations of the study
an Act known as Companies Act 2013.The was the paucity of time and financial
Companies Act, 2013 introduced the idea of CSR resources.
to the forefront and through its disclose-or- 4. As the study was conducted on a single
explain mandate, is bolstering greater firm ie the Tata motors thus the results
transparency and disclosure. Ministry of could not be generalized to other groups
Corporate Affairs had notified Section 135 and and remained limited to the study only.
Schedule VII of the Companies Act as well as the 5. The study included a small number of
provisions of the Companies (Corporate Social statistical observations and various other
Responsibility Policy) Rules, 2014(CRS Rules) variables were left for future research.
which has come into effect from 1 April 2014. 6. The study covered the time period 2009-
The present research is exploratory in nature and 2010 to 2014-15, thus period prior to
will explore the possibilities of social 2009 and future period was ignored.
responsibility done by Tata Motors. A plethora 7. The study focused on the level of CSR
of empirical studies have been conducted in with respect to stakeholders as a whole
India on CSR but no proper research has been but CSR towards individual stakeholder
undertaken to examine the CSR activities was not the part of study.
performed by the family run business of Tata 8. The reliability of the CSR data is also an
Group. Thus, the present study has been important issue, as data from different
undertaken to fill the gap. sources have significant differences
regarding how to evaluate the CSR
performance of a firm.
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37INTERNATIONAL JOURNAL OF CURRENT ENGINEERING AND SCIENTIFIC RESEARCH (IJCESR)
Results and Discussions
Areas 2009-10 2010-11 2011-12 2012-13 2013-14 2014-15
Poverty & training in irrigation Milk Collection Land
hunger farm facility System levelling
eradication development,
irrigation
facility
Education Teacher Scholarships mobile science e-learning collabor Coaching of IIT-
training, lab, students programs, ation JEE, financial help
Co-curricular drop-in centres, creative with to student,
activities, school building materials, schools coaching of
Scholarship, renovated scholarships, student,
desks and students, coaching scholarship to
benches made providing desks classes, students,
from packing & benches facility up special coaching,
wood gradation, infrastructure in
distributed, Teacher school,
school ground training cocurricular
activity
Women Women women Mahila Sharan opportunity
Empowerme training SHGs for rural
nt formed women
Child snacks to tribal Health health services Parivar Child malnutrition
Mortality children, check-ups to malnourished, Kalyan
malnutrition Food, medical, Sansthan,
prevention children Malnutrition
immunized, prevention
malnourished
children
checkup camp
Health Mobile health, health patients treated, JANEEV drinking water
awareness check-ups, community Program, project,
camp, men Sanitation, health care health care, Health awareness
health care, Anaemia services, Health health check- females,
eye operation, treatment check-up, ups, health Preventative
Health Care, Health awareness, health services
sanitation awareness eye-camp
toilet, drinking programs
water Anaemia
treatment to
women, Eye-
camp program,
Malaria
prevention
program ,
Children with
special abilities,
blood donation
camp, drinking
water solution
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38INTERNATIONAL JOURNAL OF CURRENT ENGINEERING AND SCIENTIFIC RESEARCH (IJCESR)
Environmen installed rainwater environment biogas unit trees Awareness to
tal smokeless harvesting, protection plan, installed, planted student,
Sustainabilit chullas, trees trees planted infiltration well zero waste Solar lamp,
y planted, created discharge Tree plantation
people plants,
sensitized on tree
environment plantation,
issues environment
conservation
Vocation al trained workshop to computer skill students Technica Signed MOU for
skills wireman teachers, training training, l employment and
plumbing, volunteers, Industrial training training,
girls training, Vehicle training to youth Driver training,
Driving training, centres training non auto
training, employment trade, agriculture
Technical and training, Training
vocational Technical
training and
vocational
training
Social waste Renovation inter-farm roads, Driver Provided
Projects collection cart of Primary farmers, Driving training, relief
School Training sanitation material,
Sanitation Drive drive, packing
Safe drinking safe drinking wood for
water Toilet water, underpri
training & vileged
support of people
entrepreneurs
Contribution Donated one
to Funds day salary
2009-10 donating one day salary to the victims of
If we see the poverty and hunger eradication Tata tsunami, 26/11 terror attack and flood.
Motors had focused on agriculture in different 2010-11
ways like training in farm. In case of education, To remove poverty & hunger eradication, Tata
company provided teacher training, co-curricular Motors provided irrigational facility to 2000
activities, scholarship, prepared school ground families and contributed in development of
and 3000 desks and 730 benches made from 441.5 acres of land. In the field of education,
packing wood in 20 schools. In women Tata Motors provided scholarship to 278
empowerment, Tata Motors provided training to students. To empower women Tata Motors
women. In case of child mortality, they provided found 150 women’s SHG. In case of child
snacks to tribal children for the prevention of mortality health check up camp were organized
malnutrition prevention. In case of health, in 2390 schools by Tata motors. In
company provided mobile health care, awareness environment sustainability, Tata Motors
camp, men health care, eye operation, toilet and established 200 rain water harvest locations
portable drinking water. In environmental and planted 100000 trees. Tata Motors
sustainability, Tata Motors installed 200 provided vocational skills by organising half
smokeless chullas, planted trees and sensitized day workshop for teachers by 50 volunteers,
people on environment issues. In vocational vehicle training to 170 and trained 1467
skills, Tata Motors provided training in wireman, persons, 354 sc students trained for
plumbing, driving and girls in computers. In employment, 7000 benefitted through
social projects they provided waste collection technical and vocational training. In social
cart. Tata Motors contributed to employees by projects company renovated primary school.
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39INTERNATIONAL JOURNAL OF CURRENT ENGINEERING AND SCIENTIFIC RESEARCH (IJCESR)
Tata Motors had not provided any information events for 6276 persons, SC/ST scholarships
regarding contribution to funds. provided to 971 students, coaching classes for
2011-12 3350, infrastructure and facility up-gradation
To remove poverty & hunger eradication Tata for 15597 people and teacher training to 374
Motors started milk collection system in which teachers. In women empowerment, Tata
15 youth were engaged. In education,Tata Motors provided opportunity for 912 rural
Motors organized 14 drop-in centres in which women. To reduce child mortality Tata Motors
139 students of villages participated, benefitted organized parivar kalyan sansthan in which
3700 students by renovating school building, 400 participated, 317 prevented through
provided desks, benches for 1,700 students, malnutrition prevention drive. In health,Tata
mobile science lab for 1,500 students. To Motors janeev program benefitted 157 people,
empower women Tata Motors provided community health care services helped 84243
training to 465 women and mahila sharan to people, 2595 benefitted through health check-
200 women. To reduce child mortality, ups in schools, 10214 benefitted through health
company provided health services to100 awareness programs, 2758 benefitted through
malnourished children, food and medicine to eye camp, 165000 helped through a survey for
300 children, immunization to 6800, leprosy detection.Tata Motors installed 5
malnourishment benefit for 576 children and biogas units in 2 villages, zero waste discharge
checkup camp for 723 children. In health Tata plants, planted 233760 trees in 245 acres,
Motors treated 3800 patients, 72874 treated awareness on environment conservation to 150
through community health care services, health students in environmental Sustainability area.
check-ups in 5431 schools, health awareness In Vocational skills, Tata Motors provided
programs in 10557,972 women given anaemia students training and Industrial Training
treatment, 5242 treated through eye-camp Centre.Tata motors provided driver training,
program,1659 prevented through malaria sanitation drive, safe drinking water and
prevention program. Tata Motors helped training & support of entrepreneurs in social
children with special abilities, organized blood projects.
donation camp and established 13 drinking 2013-14
water solutions. Tata Steel treated 150 patients No contribution of Tata Motors is found in
under operation smile, primary health service poverty & hunger eradication, women
to 289517 persons, HIV/AIDS Awareness to empowerment field, child mortality and health.
310000 persons, family planning services to In education, Tata Motors collaborated with
7198, khushi clinic medical chech up of 4864 schools to promote learning which led to
patients, mobile medical units benefitted, participation of more than 328000 students in
outdoor and indoor patients treated and awared UK. In environmental sustainability company
HIV. In case of environmental sustainability planted 164000 trees. In vocational skills, Tata
company benefitted 10000 people by creating Motors trained 125 enrolled apprentices in
infiltration wells and environment protection imperial technical training and trained 12 local
plan. In vocational skills, Tata Motors youth. In social projects, Tata Motors provided
provided computer skill training to 35 persons. relief material to 500 families and used packing
In social projects, Tata Motors constructed wood of the vehicle used underprivileged
inter-farm roads benefitting 1875 farmers, people.Tata Motors didn’t show any
driving training to 4880, benefitted 4098 contribution to Funds.
through sanitation drive, safe drinking water to 2014-15
32889 and provided toilets to 4098. Tata Motors had not provided any contribution
2012-13 in poverty reduction & hunger eradication,
To reduce poverty & hunger eradication Tata social projects and women empowerment. In
Motors levelled 3809 acres of land. In education, they provided coaching of IIT-JEE,
education,Tata Motors provided e-learning financial help to IIT student, coaching of X
programs which helped 5739 persons, more student in 146 schools of Mumbai, scholarship
than 22,000 school children, provided creative to 1502 students, special coaching to
material to 295 children, organized various 24784,infrastructure in 12175 school and co-
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40INTERNATIONAL JOURNAL OF CURRENT ENGINEERING AND SCIENTIFIC RESEARCH (IJCESR)
curricular activities for 8314 students. Tata done work in different nature and in different
Motors addressed 1102 cases of child areas which has led to the benefit of people of
malnutrition to reduce problem in small different areas and in different sence. In general
children.Tata Motors provided 330 drinking the CSR policies of Tata Motors cover the
water projects including 34 new project for general topics mentioned in the CSR frame of
96200 persons, health awareness to 9385 reference, i.e. labour, environment and more
females and preventative health services to economic related issues. A comparison between
98083 persons. Tata Motors provided the CSR frame of reference and the practice of
environmental awareness to 15263 students, Tata Motors in India shows a small gap between
solar lamp for 8500 students and planted 85140 them as the comparative table has shown that
saplings. Tata Motors provided vocational almost every variable in the sample companies is
skills by signing a MOU with director general covered. Study has showed large number of
of employment and training, driver training to people benefitted by these work in this study.
22171, motor mechanic vehicle training to 754, Future study can be performed by analyzing the
training of non auto trade to 1410, training amount of fund spended by Tata Motors in these
agriculture and allied trades to 1837 persons. areas.
Findings and suggestions of the Study
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