Changing CSR practices of corporates – a study of institutionalization of mandated corporate social responsibility in India
International Journal of Law and Management
ISSN: 1754-243X
Article publication date: 9 January 2023
Issue publication date: 16 February 2023
Abstract
Purpose
Globally, corporate social responsibility (CSR) has been a voluntary practice, but faced serious limitations in its institutionalization. Resultantly, India, through the Companies Act, 2013, mandates corporates to change voluntary and ad hoc CSR practices into strategic and systematic projects. This paper aims to explore the changes brought in CSR practices by corporates under the influence of CSR law. The goal is to fill the literature gap on qualitative changes brought in CSR practices by the mandate.
Design/methodology/approach
This qualitative study used purposive sampling and conducted in-depth interviews of corporate officials, nongovernmental organization (NGO) officials and academicians. The findings are discussed with the theoretical framework of institutional isomorphism.
Findings
This paper presents changes in CSR practices in six themes: ad hoc to project-mode program designing and planning, stricter due diligence of NGOs, multi-stakeholder implementation of impact-driven projects, strict monitoring mechanisms, higher funding and rigorous reporting. These changes contribute to an understanding of the shift from voluntary to mandatory CSR in India, institutionalized through a mix of normative, coercive and mimetic pressures.
Practical implications
Indian corporates can adopt the systematic practices in their CSR programmatic cycle, as presented in this study. NGOs would gain insights into newer requirements of corporates to design effective collaborations. Future studies can be conducted to describe the extent of institutionalization of CSR practices in India.
Originality/value
This paper creates knowledge for multiple stakeholders of CSR in India and other developing countries by presenting changes brought in CSR practices by a legal mandate in comparison to voluntary CSR.
Keywords
Acknowledgements
Funding information: University Grants Commission 10588.
The authors would like to thank the editor and anonymous reviewers for their feedback to strengthen the article. The author would also like to thank Dr. Ankur Srivastava (University of North Carolina at Chapel Hill, North Carolina, USA), Dr. Susan Appe (University at Albany, SUNY, NY, USA), and Ms. Priyanka Korde (Tata Institute of Social Sciences, Mumbai, India)for their comments and support in revising this article.
Citation
Bihari, A. and Shajahan, P.K. (2023), "Changing CSR practices of corporates – a study of institutionalization of mandated corporate social responsibility in India", International Journal of Law and Management, Vol. 65 No. 2, pp. 105-124. https://doi.org/10.1108/IJLMA-09-2022-0198
Publisher
:Emerald Publishing Limited
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