COUNTRY REPORT SUBMITTED TOWARDS THE PARTIAL FULFILLMENT OF POST GRADUATE DEGREE IN INTERNATIONAL BUSINESS 21st October 2012-

30th November 2012

CSR - JUSTIFIED OR NOT ?

SUBMITTED BY: GOPAL MAHESHWARI MBA-IB (2011-2013) Roll No. : A1802011057

AMITY INTERNATIONAL BUSINESS SCHOOL, NOIDA AMITY UNIVERSITY UTTAR PRADESH

Certificate of Origin

This is to certify that Mr. Gopal Maheshwari, a Post Graduate student of MBA-IB, Amity Global Business School has completed his country report, under the guidance and supervision of Dr. Ashish S. Noel, Assistant Professor, Amity University, Noida, and Uttar Pradesh. This Country report has the requisite standard for the partial fulfillment of the Post Graduate Degree in International Business. To the best of our knowledge no part of this country report has been reproduced from any other report or source and the contents are based on original research.

Signature (Faculty Guide)

Signature (Student)

Acknowledgement No good work flows without the help from faculty members, industrial professionals, colleagues, organization and friends.

I earnestly acknowledge the opportunity provided by Amity International Business School, Amity University, Noida, Uttar Pradesh by sending me to Study Abroad Program, London, UK

I express my sincere gratitude to my faculty guide Mr. Ashish S Noel for his able guidance, continuous support and cooperation throughout my report, without which the present work would not have been possible. I would like to thank the entire workforce and customers of TESCO & SAINSBURYS for their support and help in the completion of my project.

Finally, I thank all those people whose silent presence gave me the right insights to complete the project.

Gopal Maheshwari MBA IB (2011-13)

Table of Content S.NO 1 2 TOPIC Executive summary Chapter 1: Introduction Corporate Social Responsibility Stakeholders Objectives of Project 3. Chapter 2: Literature Review Concept of CSR Importance of CSR Approaches towards CSR Government Role & CSR CSR & Consumer 4. Chapter 3: Company Profile Sainsburys CSR Review TESCO CSR Review 5 Chapter 4: Research Methodology Annual CSR Report Research Design Sample & Sampling Techniques Software Used Data Collection Limitations of Project 6 Chapter 5: Data Analysis & Interpretation Question and its analysis 7. Chapter 6: Conclusion Recommendations 8 Annexure 42 44 45 25 26-41 24 23 22 16 19 9 9 11 12 14 6 6 7 Page No. 5

Executive Summary Corporate social responsibility needed a detailed explanation few decades ago, is now included in almost every mission and vision statement and also matter in the recent times. Now to start with, this short term project will be examining what CSR actually stands for in reality with the help of definitions by different intellectuals. After that the project further enquires the different approaches towards CSR as some people are in favour of CSR and many are against CSR activities in the business. Furthermore, the project throws light on the obligation and practices of the different institutions and authorities which includes businesses, Government, Professional accountants, Non government organization and general public as well. An impartial conclusion has been made after enquiring the findings from previous literature, previous progress in respect of CSR, corporate world's role in current situation, future priorities declared by government, accountants, non- government organizations and civil society . Moreover, an analytical approach of case studies has been adopted in the project where mainly two companies Sainsbury and Tesco have been chosen to demonstrate the corporate world's current role with regards to CSR. In addition to two companies Sainsbury and Tesco, the analysis of the scores of other companies is also included to reach the conclusion. Finally, the projects propose some recommendation with regards to CSR for Government, Professional accountant, Businesses and civil society that they need to make collective efforts to make this world a better place not only for themselves but for the successors as well.

Chapter 1 INTRODUCTION CORPORATE SOCIAL RESPONSIBILITY CSR is about how companies manage business processes to produce an overall positive impact on society and environment. Corporate Social Responsibility is the continuous commitment by organizations to behave ethically and contribute to economic development while improving the quality of life of the workforce and their families as well as of the local community and society at large. CSR is a process with the aim to embrace responsibility for the company's actions and encourage a positive impact through its activities on the environment, consumers, employees, communities, stakeholders and all other members of the public sphere who may also be considered as stakeholders. CSR is titled to aid an organization's mission as well as a guide to what the company stands for and will uphold to its consumers

STAKEHOLDERS People and organizations which has direct or indirect stake in an organization as it can affect or be affected by the organization's actions, objectives and policies. Key stakeholders in a business company include creditors, customers, directors, employees, government (and its agencies), owners (shareholders), suppliers, unions and the community from which the business draw its resources. Business houses need to maintain their relationship with their stakeholders for both short and long term benefits. It is considered to be more valuable for a company to involve their stakeholder in the whole process and communicate them through a easy and sophisticated process. For the lasting relationship with the stakeholders, the managers need to widen the role of the stakeholders by moving form just informing and responding to involving them in corporate social responsibility process.
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OBJECTIVES OF PROJECT A large part of this project includes the discussion about the importance of the CSR of the businesses, Government, civil society. This project has tried to achieve the following objective in the project. What is CSR in reality with its true spirit Importance of CSR in the current era What the businesses are doing in this respect Is the CSR justified or not ?

Some people recognize CSR as a report for public relation. Some say it is how to enhance the business competitiveness. Some call it a good business practice. While the other feels it is just a type of threat. CSR is a framework of relations between corporate world and the rest of society both nationally and internationally. CSR is not just the activities for the big companies in the world but for all the companies that exist in this world because people and society exist everywhere. CSR is good for long term business development. The world has seen progress in every imaginable area and CSR has increased more concerns for the society. That's why a strong partnership of society and business world is needed to deal with all the concerns. Government in this aspect has a very important role to play so as to bound and encourage the corporate world to recognize its social responsibility and act positively. CSR is not the responsibility of only one department, company or community but participation is needed from every field of society including Governments, Corporate world, NGOs, Professional bodies and Civil society.

Priorities So For CSR has garbed attention for all including media but on the other hand the real importance of the CSR is being neglected in some way or other. Many organizations are using CSR as a tool to make money for their shareholders ignoring the other stakeholders of the business which is totally against the true spirit of CSR. The government and private bodies made some priorities in the past years and started working on CSR. They precisely mentioned some principle to go along with these issues. For example U.K CSR department announced publically that it will highlight the importance of social and environmental responsibility, assist the involvement of all the small and medium sized companies in this respect. They further mentioned that they will favour the transparency of CSR reporting and aware the whole corporate not only in U.K but all over the world. To talk about the professionals who are considered responsible for reporting financial and social issues used to follow only a set of rules established by GAAP and other bodies. The professional used to look into the past for reporting like historic cost, prudence etc and have ignored the changing trends of the world which has become the global village. In terms of the companies priorities for CSR, it seems that they are claiming more rather then taking practical steps and their priorities together with their practice are more ambiguous. Although CSR reportings have become a tradition in many companies but more still they are lacking many aspects. It seems that companies are looking on their own benefits only and not focusing to other stakeholders .They seems to follow Friedman's idea that money belongs to shareholders only and they have to decide where to invest it. They are planning for the short term profits ignoring long term. They are not considering that by investing in social issues like community development, employees betterment , customer care, environment issue etc not only improves the reputation of the companies but develop the companies benefits in long term. But in spite of all the claims it seems that saying something and doing something practically are two different things. One can find thousands of press releases about CSR but only a few practical steps can be found. It did not mean that nothing is done on CSR but it needs more refinement.

Chapter 2 Literature review This Chapter will examine the academic literature on Corporate Social Responsibility. More specifically the review will focus upon what CSR in reality stands for, its importance, Rules and Regulation, what the companies are doing in respect of CSR, Professional Accountants' Role and expectations of the stakeholders. (McWilliams, Siegel, Wright, 2006) "Through the power of collective action, the Global Compact of CSR seeks to advance responsible corporate citizenship so that business can become a part of the solution to the challenges of globalization. In this way, the private sector - in partnership with other social actors - can help realize the Secretary-General's vision: a more sustainable and inclusive global economy". (www.unglobalcompact.org) The basic concept of CSR "JCI believes that CSR is about what a business can do - not about what business must do. It is about opportunities not about obligations or new rules". (www.davidgrayson.net). The recent CSR concept was first found in the mid-twentieth when the focus was just on social issues like charity and Labour issues. But later the area of this discussion widened and covered ecological issues as well. It included how a business organization should take account of its economic, social and environment impacts in the way it operates- maximizing the benefits and minimizing the downsides. Corporate social responsibility means that a company or business is not only accountable to its shareholders but to all its stakeholders which include its customers, suppliers, employees, local communities, investors, environment, governments etc. CSR to a very large extent has been noticed as a voluntary action with very less legal requirements. Importance of CSR The exploration in the business world is as old as business world itself. Whether it is employees rights, communities inconvenience, environment, shareholders, customers, suppliers, creditors or debtors it has been obvious everywhere in the world. But as the CSR has gained a lot of attention in recent years, the world has become the global village now
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where the comments like ' Profit is only responsibility cannot be accepted. (Husted, B.W. and Salazar, J., 2006). Where selected stakeholders like particular suppliers, creditors or shareholders cannot be favored by managers, where abuse of power by business houses cannot exist, employees cannot be exploited like earlier days and society cannot ignore the damage done to the environment. The main reason for all this awareness is CSR. One thing for sure is that the pressure on business is to play its role on social issues will keep on growing in future. In the last years the organization which worked hard within the global sphere of operation gained more respect, more power, more monetary benefits and influence as well. On the other hand the organizations like police, judiciary and scores of government institutions have been failed in doing so. But the pressure is growing day by day in this field. The governments has admitted that it cannot change the whole world without the help of the people who are living in the world mainly the corporate world which is getting benefits from the society. So the government in every other way putting pressure on the businesses to contribute towards the social issues. On the other hand organisations have also come to know that for long term recognition and benefits, they have to respect CSR. They have to recognize the rights of their employees, respect their suppliers, save the environment and contribute towards the other issues which exist in the society as whole. Intangibles and CSR Relation The importance of the intangibles cannot be ignored as the new International Financial Reporting Standards (IFRS) stated that from 2005 all listed European companies must report acquired intangible assets. The intangible assets includes Brand value, goodwill etc. (www.csr.gov.uk). It is said that intangible assets are of more important for a business than the tangible ones. CSR not only helps in building these assets but also protects and expands them. For example the brand value of any brand do not start from the beginning but it is retained afterwards with different CSR activities which may include Consumer specific activities, health and safety

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measures , Sponsoring community development programme, support for clean environment and the list goes on. Competitiveness in CSR A business can be more competitive and successful by adopting CSR policies which is an edge for any company. For example a link between a business and customer give more information to the business about the needs and requirements of the customer directly. Ultimately, this link results in the business becoming more competitive in terms of product development. CRS also makes the businesses more efficient and competitive in respect of 4Ps i.e. price by taking steps like minimizing waste .If the companies prefer to make the recyclable products, it can help on the one hand to reduce a danger for environment and on the other hand can help a lot to reduce the cost of the product which ultimately results in low price for the customer and more benefits for the businesses. Various Approaches towards CSR Corporate social responsibility is one of the topics-like Manchester United and the New York Yankees- that raises passions both for and against (Simon, 2005). Different approaches can be found on CSR out of which few are contradictory. This part will examine some of the approaches available and analyze them. For many years, Milton Friedman (1962) has been known as villain in the business and social literature. His quote, that business are owned by their shareholders and they have to decide about whether there money is to be given to the charity or not, has been criticized (Husted and Salazar, 2006).Another argument that CSR is indicative of self-serving behavior on the part of manager and it reduces shareholders wealth (Abagail , Donald and Patrick 2006). But without going much into the details this idea seems to be true that how spending on social issues will help an organization to maximize the benefits of the businesses. The shareholders dont have any problem to spend a moderate amount on these types of issues. On the contrast, there are others who have totally different views. For example Jones says in his stakeholders' theory that the firms which are loyal and honest to their stakeholders ultimately create incentives for their own firms. Some experts say that CSR is only used by some companies to get competitive advantages. (Abagail , Donald and Patrick 2006)
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Some are with the viewpoint that CSR is not about giving just the charity only but it is more than that. It is about helping the community, the society, taking steps to save environment, taking care for the rights of employees, improving relationship with customers and about contributing towards other social issues as the company or organization is itself a part of society in which it exist. One thing is quite sure from the previous experiences that companies cannot maintain business success and shareholder value just by maximising there short-term profits and the importance of the CSR cannot be ignored in the recent time. (Oketch, M. 2004). The companies must, therefore take part in the activities which allow them to get benefit in the long run, and contribute as much as possible to the community without making a loss. This will then take them towards a win-win situation. Poverty Reduction and CSR Because of the unfair and unequal distribution of the wealth, people all across the world in many countries do not have food to eat and water to drink while in some countries people have more than they need. Although poverty reduction and CSR do not seem to be connected with each other yet their social responsibility is to contribute to reduce the poverty especially in developing countries. Creating Jobs, Training the people, addressing the issue of society, child labour problem, gender inequality, health care, community development, higher minimum wage and better working place conditions are some of the steps under the roof of CSR which can help to reduce the poverty to a certain level. A proactive approach of corporate, society, professionals and governments is needed towards CSR to reduce the poverty. Governments' role in CSR The role of the governments is very vital in improving the contribution of the business houses to the social development. According to many intellectuals the basic factor which prompts any organization to play its responsible role in society is legislation in that particular area. There are various laws which cover many areas like minimum wage, Health and safety and disclosure to investors but the governments has to make some amendments in laws in the areas such as social and environment. Whereas on the other hand many has opinion that if the legislation regarding CSR is prepared, the corporate will only make efforts which the law
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requires but never more. At the moment many companies are doing their best voluntarily but the legislation can effect their motivation and they many companies may step back. The governments have been facing two challenges. The first is how to engage more and more companies in CSR and second how to make the contribution of the organization better in terms of CSR. For the first challenge the government has make a set of strict rules and regulation for the companies to follow CSR and reviewed it by action and polices across the board and made CSR a priority. For the second challenge the government has to encourage the roles of the companies which are doing their bets for the social issues. The government can make CSR better by providing best practice guidance, intelligent regulations and incentives to the companies where needed. Some suggestions for making a separate department for CSR has also come to the surface from many critics. U.K Government and CSR U.K business to some extent going in the right direction as the global Reports of 2006 survey shows that U.K companies were rated the top three reporters (www.csr.gov.uk). 'Since I became Minister for CSR in May 2002 we have seen rapid growth in Interest in the application and implications of CSR. What has impressed me most has been the level of creativity and enthusiasm brought to the subject from all quarters. We've seen encouraging progress. I'd like to highlight some significant recent developments and look at where we need to focus for the future.'' (www.csr.gov.uk) The government encourages all the companies to present report on their CSR performance in different ways like: Issued guidance on environment reporting The ACCA sustainability reporting awards Supported the global Reporting Initiative

The U.K Government has brought the regulation up to date as well. From October 2007 Quoted companies must also disclose the information about employees, environment, social and communities matters. Company act 2006 also has shown some legislation in this respect. (www.corporateRegister.com)
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Role of European Union in CSR with respect to CSR in Eupore Like UK, European commission also considers that CSR is an important area and they have already started working. In 2001 the European commission developed a strategy on CSR which resulted in the establishment of a Multi-Stakeholder forum on CSR in October 2002. In march 2006 EU published its communication on CSR which states that CSR can make a significant contribution and make Europe a ' pole of excellence''. During its presidency of EU in 2006, Finland held a conference with the name ' Corporate social responsibility policies promoting innovation and competitiveness'' which also emphasized on the importance of the Corporate Social Responsibility. (www.csr.gov.uk) International Commitments & CSR In September 2006 a world summit on sustainable development'' was held in Johannesburg where all participant countries committed to promote corporate responsibility and made a future line of work. Some critics, however, says that government is trying to neglect its duties because they are just dependent on the NGOs. Governments are trying to push NGOs on the front foot instead of going ahead and face the country themselves. It is true that government is putting efforts for the development of CSR but the main problem which it faces is practice. It has been observed in different surveys that the NGOs in the world are making more efforts then government and is taking practical steps for the solutions of social issues more than the governments and the Governments are lacking the implementation of the its theory . CSR and its Consumer To talk about the role of the general public, the consumers they also have a very important role to play. Sometime the companies only want to be more efficient and wishes to make CSR Central to their corporate identity. For example the 7th Generation which is the suppliers of the chlorine-free toilet tissues & Ben & Jerry's, who are the eco-friendly ice-cream maker, have not been responded very well by the consumer. It seems that only a small amount of people are ready to pay premium prices for these responsible products. These types of behavior from consumer demoralize the companies and force them to limit their CSR activities. Some critics says that only consumer cannot be blamed for not supporting CSR as

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it is the duty of the government as well that it should create awareness to the general public about CSR. If a common consumer does not know what CSR is all about or how it can be supported by them, how consumer can encourage such activities about which they have no idea. Absence of CSR and its Consequences The above mentioned discussion regarding the CSR and its importance made one thing crystal clear that CSR is essential both from the business and Social point of view. If the society, businesses and other academics in the field do not challenge these issues and stop being passive in order to meet the true purpose of their roles, the problems will continue to grow. As far as the business is concerned they make money while working in a society. If the society in whih they are working is strong enough in respect of money and can enjoy the basics needs of the life the economy will grow which will result in a prosperous Situation. If the companies are making money from the people, it is not very difficult to give some part of it back to the people in the form of facilitating them in different respects such as community development, helping the poor, Taking care their children, take care of the suppliers, customers, employees and contribute towards the proper solution of environmental issues which is in reality their surroundings as well. It is rightly said that to get love from someone you have to give it first. By doing all these in regard of CSR the companies actually enhance their image side by side other benefits for long term. In the absence of CSR business can make money but cant earn long term benefits and respect in the society in current situation.

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Chapter 3 Company Profile Sainsbury's CSR Review (2011) Sainsbury is one of the leading U.K food retailers with other financial activities as well. It consists of Sainsbury supermarket, Sainsbury's Local, Bells stores, Jackson's stores, Sainsbury's online and Sainsbury's bank. Sainsbury employees around about 150000 people. According to Justin King, The Chief Executive of Sainsbury, being a responsible organization Sainsbury have five principles that provide a framework for business. These include 1. Respect for environment 2. A great place for work 3. Making positive difference to the community 4. Sourcing with integrity 5. Best for food and health

Environment To start with the environmental issues, problem in terms of environment is Climate Change. This has changed the thinking of the world. Hundreds of seminar, summits and government policies can be seen in a year times which states that every single entity in this world need to contribute towards the solution for this problem. As the well wisher of the society, every individual needs to contribute towards the betterment of the society. CSR report 2011 of Sainsbury has given some of the important achievements in this respect and has also set targets for the future. Acc. to the Chief Executive, Justin King, Sainsbury is responsible towards the environment and is taking practical steps towards this. (www.j-sainsbury.co.uk) The first major step, according to the CSR report 2011, which they have taken, is that they have reduced the energy consumption compared to previous years. In 2007/2008 Sainsbury opened UK's greenest store where they installed new energy - saving technologies. Another major step Sainsbury has taken is that they have introduced electric delivery vans and trailed river transport as congestion free alternative to using Lorries in London. Sainsbury has
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improved its energy efficiency in last years from 425 kgCO2/m2 (2006/07) to 721 kgCO2/m2 (2010/11). This step has been welcomed not only by various NGOs and government but by civil society as well. It would create a great impact on economy, environment and has set an milestone for the other companies as well because less energy use means less operational costs and less CO2 emissions. Community Welfare As community is an important stakeholder of corporate, so the importance of the society cant be ignored. According to Department of health 1.8 million children in U.K are overweight in addition to 700000 more as obese and this figure can increase to 25% by 2050 if the serious steps are not taken. Sainsbury has donated 52 million worth of sports and activity equipment to schools through Active kids. They have already claimed to raise this amount to 100 million by 2015. Furthermore they are sponsoring English Schools' Athletic Association (ESSA) Being the sole retail sponsor of comic relief since 1999, Sainsbury raised 2.3 million in 2008 only. This money is used to support the most disadvantaged people in the communityWhen the water supply was shut off in Gloucestershire due to flooding in 2007 and the people were without water, Sainsbury was the first retailer to donate a free water bottle for the members of the community. Donating food to various charities, Local hero scheme and providing youngsters the experience of scouting are few example of the contribution towards the betterment of the community. (www.j-sainsbury.co.uk) A safe neighborhood is very important part of a society. Sainsbury introduced a scheme of safer neighborhood in 2006 which was the result of the conversation of CEO Sainsbury, Justin King, and Mayor of London, Livingstone. The purpose of the scheme was to provide safe environment to its customers and employees throughout the U.K. Some of the major steps which Sainsbury has taken for the development of the community/society is the recruitment of the Disable people with minimum requirements for the job, providing flexible hours to their employees, Giving lots of chances to the people with fresh start, Local employment partnership and Ex-offenders program all across the UK.

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Less water consumption Water consumption, is a problem which effect the environment very badly. Water is known as life and world's most precious thing .The value of water can be asked from those people who do not have it or get it with various efforts. To consume less water Sainsbury has taken many steps like they have installed non-hazardous, microbiological urinal flushing system in their stores. Acc to them this step only will save 201 million liters of water annually. They are following the philosophy of reducing, reusing and recycling. Reusable carrier bags are also provided by Sainsbury to its customer to support environmental solution. (www.jsainsbury.co.uk) Healthier Diet Healthier diet make the society healthier and Sainsbury is deeply concerned for their commitment to provide healthy eating. In 2007 Sainsbury launched a Nutrition Science Advisory Group and started working with British Nutrition Foundation and other organization to provide healthy foodstuff to the society. Some examples of the efforts are mentioned in Sainsbury's CSR report 2011. Sainsbury in over 80% of product has already met the Food Standards Agency's (FSA) 2010 salt target. They have already removed 26.5 tonnes of salt from their sandwiches in the past years. For milk products they have introduced their own-brand 1% fat milk which is half of the fat milk available in grocery market. 75% of the cereal provided by Sainsbury is of high fiber as majority of the people in the U.K do not get enough fiber in their diet. They have taken practical steps for reducing sugar and Big 5 drive has encouraged customers to make fruit and vegetables an important part of their daily diet. (www.j-sainsbury.co.uk) To make it easy to find the right product which customers are looking for Sainsbury has made their labeling very transparent with precise description regarding the product. In May 2007, Sainsbury became the first to adopt the Department of Health's Guidelines on Alcohol Labeling.

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Equality of rights A socially responsible organization tries to accommodate all of its employees regardless of their background, gender, color etc. Equality of right is another characteristic of Sainsbury's social responsibility. They have reported in the CSR report 2011 shows that they have 37% female duty managers and 21% store managers. They have further announced that they will start coaching the female managers. Suppliers' Importance The suppliers have their own importance like stakeholders and companies need to be responsible, honest and fair towards their suppliers. Sainsbury names all its sourcing with integrity which clearly means honest relationship with their suppliers. In past years they initiated a program to support the organic apple farmers and help British beef Farmers too. Sainsbury arranged a supplier conference in Jan 2011 and about 1100 delegates attended this conference. Tesco CSR review (2011) Tesco Is world's third largest and UK largest grocery retailer with more than 440,000 employees working worldwide and 3728 stores worldwide in 13 countries. Tesco claims to be one of the most responsible corporate with clear social and environment approach. (www.tescoreports.com) For Tesco Corporate responsibility is not just fundamental part of business planning but a strategy of growth as well. The chief executive, Sir Terry Leahy, has motioned some of the key steps taken by Tesco in terms of corporate social responsibility in Tesco CSR review 2011. He explained that various groups that are influence or are affected by Tesco business is fundamental to Tesco values. He has further added that stakeholders' needs and concern regarding any issues also help them to identify the various relevant CR issues. The belief that business has an important role to play to in society has raised various challenges for the businesses. Whether it is poverty reduction or community development or environment issues or customer satisfaction, corporates are expected to play their roles. (www.tescoreports.com)

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Environment To start with the environmental issues which requires more efforts in the recent times than previous years. The issues of Climate change will require some serious commitment from every field of life. The discussion regarding the climate change has already opened the eyes of people, governments, businesses, NGOs towards this issue. The experts are with a view that if we want us as well as our children to remain healthy we have to reduce the carbon emission by 50% at least by 2050 globally. Some critics in UK say supermarkets are to a very large extent part of this main problem. They say that the supermarkets are running energyintensive stores by selling the product which is coming far off area. (www.tescoreports.com) Some steps have already been taken for instance, Tesco has reduced its carbon emission from 8.6 in 2006 to 2.41 in 2011.Tesco have also showed a very transparent system for publishing their direct carbon footprint which help them to identify the various areas of their concern. As this problem cannot be dealt single handed so Tesco has made some joint ventures with various organisation. Tesco has funded 25 million to a Sustainable Consumption Institute at the University of Manchester for a period of 5 years. It has also given 100 million Sustainable Technology Fund to support their reduction of carbon emission which will also inspire their suppliers and others to reduce the same. The main sources of carbon emission include heating, lighting, refrigerating products and transporting goods to and fro the stores. Tesco has invested 86 million in energy saving a technology which includes low energy lighting, energy-efficient bakery ovens, wind turbines, combined heat and power (CHP), regenerations and hanging curtains on freezer doors. In 2010 this investment reduced carbon emission 11.8% which exceeded the target of 10 %. (www.tescoreports.com) As a responsible company all across the world, Tesco has just not limited its steps to U.K, It has invested in energy saving technology in china, Poland, Slovakia, South Korea, Turkey, Thailand, US etc. Moreover On top of this Tesco has made it mandatory to all staff members to attend the briefings about energy saving. Environment issues like waste problems has also been dealt with responsibility as the tesco 2011 CSR review shows that it has recycled 82% of their waste last year mostly cardboard and plastic and also packaging material as well. Tesco has made 222 millions reusable trays which saved 130000 tonnes of cardboard (www.tescoreports.com).
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Tesco claims to work with dynamic and confident suppliers all across the globe. In 2007 Tesco has placed a special emphasizes on supporting smaller and local businesses. Tesco also developed a system called Tescolink which is extremely useful for their suppliers to access data such as store sales of their products anywhere anytime. (www.tescoreports.com) A great place for work Employees are the most important asset and important stakeholder in any organization. Tesco has received an award for the pension scheme pension scheme for the year Further awards which included 1. Best Trustee Training and Development 2. Best Use of Specialist Investment Managers 3. Best Pension Communication Creation of 4536 jobs in china itself, Providing variety of job to the people in their 70s and 80s by their old regeneration scheme, arrange the flexible working hours for employees, gender and sexual equality, Rewards & benefits scheme, health and safety, consulting with employees and T&D of the employees are example of Tesco's responsible behavior towards its employees. (www.tescoreports.com) Community Development More than doubled the number of Community Champions across the Group from 270 to over 650 Donated 64.3 million to charities and good causes across the Group Provided access to education for children and adults on low incomes across the world Responded to emergency relief efforts, including the earthquake and tsunami in Japan (www.tescoreports.com)

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Chapter 4 RESEARCH METHODOLOGY Research methodology is the arrangement of condition for collection and analysis of data in a manner that aims to combine the relevance to the research purpose with economy in procedure. Research is conceptual structure within which research is conducted. It is way to systematically study and solve the research problems. For this Project the Annual CSR reports of Sainsbury and Tesco in this project are studied in order to know the current situation of CSR and its importance in corporate world in U.K. The reason for choosing Sainsbury and Tesco is that both the companies are the very successful and big names in the U.K, represents a business community and rivals as well. The project aims to observe the CSR importance by analyzing both their internal and external efforts regarding CSR and their relationship towards the stakeholders in their businesses

Annual CSR Reports It's very important for the companies to recognize the importance of CSR, adopt CSR and change this world into better place for future generation. Though all the companies are claiming that no other organization can be as responsible as they are and Corporate Social Responsibility matters to them yet an analysis of the current and past situation is necessary to reach a point of view what has been done till now and what can be done more. To analyze the current CSR situation this project will examine the two companies who claim to be the best followers of CSR and are considered representatives in supermarket. The companies in consideration are J Sainsbury and Tesco which are competitors as well. Research Design A Research Design is a frame work or blue print for conducting the marketing research project. It details the procedures necessary for obtaining the information needed to structure or solve marketing research problem.

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This Project research is exploratory in nature. Explorative studies valuable means of finding out what is happening to seek new insights to ask questions and to access phenomenon in a new light. Exploratory research could be used for any of the following purposes:

Formulate a problem or define a problem more precisely. Identify alternative course of action. Isolate key variables and relationships for further examination. Gain insight for developing an approach to the problem. Establish priorities for further research. Sample & Sampling Techniques

Sample basically means a subgroup of elements of population selected for participation in study. And number of elements to be included in the study is known as sample size. The Sampling technique used in this research is Non Probability Sampling sampling technique that do not use chance selection procedures and rather they rely on the personal judgment of the researcher. Further more classification of the technique used is Convenience Sampling. Softwares used: 1. Google Documents: Used for storing the data. 2. Google Documents: Used for analysis of the collected data. 3. Microsoft Word: Used for report preparation.

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DATA COLLECTION

Primary Data: The first hand information bearing on any research is the one which has been collected by the researcher. The data here is collected through:

A structured questionnaire

Secondary Data: The data which has already been collected, complied and presented earlier by any agency may be used for purpose of investigation. The data collected through:

Various publications in form of annual reports, various papers and journals published from time to time.

Through internet and Books

Limitations of the study:

Research is based on the collection of data from both primary and secondary sources. There may be a possibility of biasness on the part of some respondents, but very much care has been taken to make this report unbiased.

Some respondents might not give the correct information due to their lack of interest and shortage of time.

Time constraint. All the information, which is taken, is biased on primary and secondary data that has its own limitations

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Chapter 5 Data Analysis & Interpretation After having reviewed the current situation of Corporate Social responsibility according to the CSR reports of both J Sainsbury and Tesco, now the task of finding weather the CSR of both the companies is justified or not is through the questionnaire method which is filled by 30 odd people(combination of employee and consumer). The main purpose for taking J Sainsbury and Tesco as examples was to give an overview of the current situation of CSR in corporate world especially in U.K. J Sainsbury and Tesco are the big names in corporate world and considered to be representative in their respective areas. Their contribution towards CSR can inspire the other companies to come forward and their lack of interest in CSR can affect the other companies' behavior.

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Findings & Data Analysis

Q.1 From where do you purchase your most of the products ?

Tesco Sainsbury

18 12

60% 40%

Out of the 30 people surveyed 60% said they buy there majority of products from Tesco rest from Sainsburys.

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Q.2 Do you know anything about the CSR of TESCO ?

Yes Little bit No

15 15 0

50% 50% 0%

When asked about do you know about the CSR of Tesco there was a 50-50 response that yes they knew most of the things and about little bit of CSR of Tesco. None of the 30 people interviewed said that they dont know anything regarding the CSR of Tesco.

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Q.3 Do you know anything about the CSR of Sainsbury ?

Yes Liittle Bit No

15 15 0

50% 50% 0%

Similar to the Tesco most of the people knew about the CSR of Sainsbury also.

The above 2 questions clearly show that these two companies have really done work for the society in the name of CSR.

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Q.4 Is CSR actually works for Society or is it just a marketing trick ?

It helps Society Its a marketing trick No idea

25 83% 4 13% 1 3%

According to the 83% of people CSR actually helps the society in various forms. 13% of the customers have a negavitve response regarding CSR and they saidf that its just a marketing trick which companies uses to gain attentaion and to attract more customers.

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Q.5 Whose CSR is Better Tesco or Sainsbury?

esco Sainsbury

17 12

57% 40%

57% of people rate the CSR policies of TESCO a better one compares to the CSR of Sainsburys. This Clearly shows the dominance of TESCO in the market.

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Q.6 According to you why is the Above mentioned Company interested in CSR ?

Competitive Pressure Community pressure Differentiation Oppurtinity Improving Business Performance Other

20 67% 18 60% 17 57% 20 67% 0 0%

People may select more than one checkbox, so percentages may add up to more than 100%. According to 60% of consumers CSR is adopted by the companies due to the community pressure which is in the form of society, NGOs, government etc 57% said that CSR gives organizations a opportunity to differentiate themselves from other companies. 67% said that due to competitive pressure, advantage and to improve business performance companies are adopting CSR policies. Acc to them CSR gives the organization a competitive edge over their competitors and when competition grows quality and quantity also grows.

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Q.7 Rank the importance of CSR according to you in the following factors? - Social

1 2 3 4 5

0 0 4 16 10

0% 0% 13% 53% 33%

Majority of People on a 5 point scale has given 4 points to the importance of social factors in CSR.

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Q.8 Rank the importance of CSR according to you in the following factors? Economical

1 2 3 4 5

0 1 7 18 4

0% 3% 23% 60% 13%

Economical factors has also been given 4 points by 60% of the people on a 5 point scale.

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Q.9 Rank the importance of CSR according to you in the following factors? Enviornmental

0 2 3 4 5

0% 0 2 12 15 0% 7% 40% 50%

Environment concern has been given 5/5 on a 5 point likert scale by 50% of the people surveyed. This shows that people are more concerned about the environment rather then social and economical issues.

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Q.10 Rank the importance of CSR according to you in the following factors? Corporate Governance

1 2 3 4 5

0 3 7 17 3

0% 10% 23% 57% 10%

According to the people surveyed 33% people gave social concerns of society an importance on the other hand only 13% people are concerned about what company is doing regarding the economical issues of country or state. moreover only 10% people are concerned about the corporate governance of the organization. Nearly 50% of the people are concerned about what the organization is doing in regard of Environmental issues which is faced by the whole of globe.

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Q.11 Rank The Company CSR Investment with respect to the below mentioned fields ? - Health Issues

1 2 3 4 5

0 1 4 14 11

0% 3% 13% 47% 37%

84% of the people has given 4 and 5 points on a 5 point Likert Scale when asked about the ranking of the company investment. They all were happy that companies are paying more and more attention towards the health issues in the society.

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Q.12 Rank The Company CSR Investment with respect to the below mentioned fields ? - Education Concern

1 2 3 4 5

0 0 5 19 6

0% 0% 17% 63% 20%

Most of the people i.e. 63% are happy that the companies are paying attention towards the educational issues of the society.

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Q.13 Rank The Company CSR Investment with respect to the below mentioned fields ? - Community Development

1 2 3 4 5

0 1 4 14 11

0% 3% 13% 47% 37%

47% people has happy towards the company investment in respect of Community Development.

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Q.14 Rank The Company CSR Investment with respect to the below mentioned fields ? - Enviornment Concern

1 2 3 4 5

0 1 1 10 18

0% 3% 3% 33% 60%

60% people are ranking 5/5 regarding the investment done by the companies on the environmental issues and the way they are dealing with this.

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Q.15 Rank The Company CSR Investment with respect to the below mentioned fields ? - People/Partners/Consumers

1 2 3 4 5

0 0 2 15 12

0% 0% 7% 50% 40%

50% people think that the investment done by the companies on there people or stake holders or customers or consumers.

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Q.16 Do you contribute in the CSR efforts of these companies ?

Yes Sometimes No

22 6 2

73% 20% 7%

Most of the people i.e. 73% of the people surveyed said that they contribute in the CSR of the companies generously because they have a faith in these companies and they also believe that the contribution which they are doing is helping the society for a better future.

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Chapter 6 Conclusion CSR is a significant responsibility in the sense that it makes an excellent relation not only between the companies and stakeholders but it also improves the image of the companies and provide them with long term benefits. A Socially Responsible company always operates in such a way that investing in them not only becomes the best alternative of the money for the consumers but they also play an important & positive role in the society in one way or another. Recycling products and renewable energy are examples of good CSR. As discussed above in the CSR of Tesco and Sainsburys and according to the analysis of the questionnaire it can be concluded that the CSR activities of the companies i.e. Tesco and Sainsbury has been playing an important role in the UK as well as other parts of the world. Their concerns regarding the equality of rights, environment, society, and stakeholders etc is commendable. The organizations are serving the society with the aim of providing them with healthy choices and the stakeholders, consumers are happy in this regard as these companies are paying attention towards their health as well as the education of the same. Presenting the CSR reports yearly with clearly mentioning the work done by organizations for the betterment of society has become a fair trade practice. Now they dont have to enhance their names by marketing of their products they are now know by the works they are doing for the society. This work will gain them long term benefits. Many critics have the viewpoint that to make situation more better government should step in and make some strict steps and make changes to rules and regulation .But at the same time it is observed that by imposing more and more rules in CSR by government will affect the actions of the company. The companies will then only try to fulfill the required criteria only and the organizations which are already trying their level best to achieve that state of art situation will be demoralized and may step back worsening the whole situation. In the questionnaire it is observed that 20% people contribute in the CSR activities of the companies sometimes only. And 7% dont contribute at all. If these 27% consumers start contributing in the CSR it will make a huge impact on the society. And thats where the difference comes in. People must start appreciating the efforts done by organizations

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In the end, to make this world a better place for the us as well as for our successors every individual on this earth including Governments, corporate and civil society need to recognize the importance of CSR all across the globe and contribute towards it in an ethical manner. Finally on the basis of all the above findings and conclusion it can be concluded that CSR is justified as it is actually helping the society. Recommendation CSR is significant in the society but is still in initial state and will continue to be in this state until serious efforts are made from all parts of society - professional, business, governments and society as well. During the last years, CSR has moved from its traditional concept of giving charity to the contributing towards all the social and environmental issues in the society. Recommendations for Government. The rules and regulation for CSR is already present in the market but are needed to be implemented. The focus of all should be on practice rather than the theories and press releases. Government Institution must themselves take part in the CSR rather than depending upon various NGOs. Organizations need to be appreciated by the government for doing CSR responsibly.

Recommendations for Companies Corporate governance of the organizations. Relationship with its staff, suppliers, Customers, Service providers , distributors and unions Role of organization in community development Performance of Companies on environmental issues and future strategies

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Chapter 7 References ALMR criticises Sainsbury's lager prices, [online], http://www.talkingretail.com/news/10618/ALMR-criticises-Sainsburys-lag.ehtml, [Accessed 19/11/12] Arguments against Corporate Social Responsibility, [online], www.mallenbaker.net, [Accessed 21/11/12] Chief executive Introduction, [online], www. j- sainsbury.co.uk/cr, [Accessed 11/11/12] Corporate Responsibility Report 2011, [online], http://www.jsainsbury.co.uk/cr/files/pdf/cr2011_report.pdf, [Accessed 15/11/12] Corporate Social Responsibility - minister Malcom Wicks, [online], www.csr.gov.uk CSR , [Accessed 15/11/12] Corporate Social Responsibility- What does it mean? [Online],www.mallenbaker.net [Accessed 17/11/12] History of Corporate Social Responsibility and Sustainability, [online], http://www.brass.cf.ac.uk/uploads/History_L3.pdf, [Accessed 25/11/12] http://www.csr.gov.uk/ukpolicy.shtml,[ Accessed20/11/12] Simon 2005, How corporate responsibility works in a market economy, [online], www.ft.com [Accessed 23/11/12]. Stakeholder, [online] , http://www.businessdictionary.com/definition/stakeholder.html, [ Accessed 22/11/12] Tesco Corporate responsibility review 2011, [online], http://www.tescoreports.com/downloads/tesco_crr.pdf, [Accessed 13/11/12] www.csr.gov.uk [Accessed 21/11/12] www.mallenbaker.net/csr/CSRfiles/against.html,[Accessed 21/11/12]

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Chapter 8 Annexure Questionnaire Q.1 From where do you purchase your most of the products ?

Tesco Sainsbury Q.2 Do you know anything about the CSR of TESCO ?

Yes Little bit No Q.3 Do you know anything about the CSR of Sainsbury ?

Yes Liittle Bit No Q.4 Is CSR actually works for Society or is it just a marketing trick ?

It helps Society Its a marketing trick No idea Q.5 Which CSR is Better Tesco or Sainsbury ?

Tesco Sainsbury Q.6 How according to you is CSR organised in the above mentioned company ?

Own CSR Dept. Cross Functional Colloboration No Structure Q.7 According to you why is the Above mentioned Company intrested in CSR

Competitive Pressure Community pressure Differentiation Oppurtinity

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Improving Business Performance Other: Q.8 Rank the importance of CSR according to you in the following factors? 1 Social Economical Enviornmental Corporate Governance Q.9 Rank The Company CSR Investment with respect to the below mentioned fields ? 1 Health Issues Education Concern Community Development Enviornment Concern People/Partners/Consumers Q.10 Do you contribute in the CSR efforts of these companies ? 2 3 4 5 2 3 4 5

Yes Sometimes No

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