Management For Sustainability

• Course :Managing For Sustainability
• Course Code:1401
• Program: MBA
• Sem-IV
• Class: MBA-II
Dr Ashish R Jaswal
Sanjivani College Of Engineering,
Dept. of MBA
Kopargaon, Dist- Ahmednagar, Maharashtra, India, Pin 423603
Dr Ashish R Jaswal,SCOE-Department of
MBA
Unit 1
Course Code:401
MBA
• Explain the significance of CSR
activities in the Present Scenario
• Explain the issues and opportunities
for business in socially and
environmentally sensitive word
1. Definition
2. Framework of CSR
3. Nature
4. Forces
5. Formulation and Implementation
6. Examples
MBA
Definitions
• According to Carroll (1983), “corporate social
responsibility involves the conduct of a business so
that it is economically profitable, law abiding, ethical
and socially supportive
• Milton Friedman, "The Social Responsibility of
Business is to Increase its Profits", The New York
Times Magazine, September 13, 1970.
• H. R. Bowen, “ Obligation of managers to pursue
those policies, to make those decisions, or to follow
those lines of action which are desirable in terms of
objective and value
MBA
•CSR strategies encourage the company to make a positive
impact on the environment and stakeholders including
consumers, employees, investors, communities, and others.
CSR As per Company act
MBA
CSR As A Framework
Where should big companies spending their
Valu CSR Resourses?
e Purpose Impact Benefit

Innovative Shared value (Business – Institutions &
CSR As and Fundamental Communities )
Promotes competitiveness and innovations
Value promotes Strategies &
operational Promote a sustainable business model
sustainable
Creation business impact
Integrate business in to the community
Develop Human Capital
models Incorporated in to business strategy
CSR As Risk Medium to mitigate operational impact

Managemen
high Strategic
Compliance Mitigates operational risk
& Operational Support external Relationship
t Impact
Corporate Philanthropy & Sponsorship

CSR As Providing Little Short term benefits/ Not always sustainable
Limited funds available
strategic &
Corporate Funding &
Operational
Impact diluted because limited budget is allocated
to many charities.
Philanthropy Skills
Impact Corporate competencies and other business Assets
Dr Ashish R Jaswal,SCOE-Department of MBA
not fully utilized.
Nature of CSR
The survival of organization depends upon

CSR
Welfare & Interest of society &
organization.
Growth of business organization
In terms of stakeholders.
Views of social responsibility- profit,
stakeholder & Society.
It is normative in nature (Laws)
Its varies for different organizations.

Forces of CSR
 Consumerism-Consciousness-Rights
 Enlightened self interest (who act to further the interests of others,
ultimately serve their own self-interest) do well by doing good
means that everybody wins.
 Trade Unionism(Corporate social responsibility is useful if it provides
the space for workers to protect their own interests – and damaging if it
tries to fill that space. Respect for basic rights, union recognition,
collective bargaining and social dialogue, including at the international
level, are key ingredients of industrial democracy and social
responsibility)
 Public opinion & Government control
 Trusteeship(no right to destroy property deliberately and wantonly)
 Professionalism(set of values that individuals should strive to
follow)

Steps to implement CSR
strategies.
 Develop an integrated CSR decision making structure.
 Plan & execute a CSR business plan.
 Set measurable target & make out performance measures.
 Engage employees & others to whom CSR apply.
 Design & conduct CSR training.
 Create mechanism for addressing problematic behavior.
 Build Internal & External communication plans.

CORPORATE
CITIZENSHIP
Definition-2M
Nature-2M
Benefits -2M
Stages-6M

Corporate Citizenship
 Corporate citizenship INVOLVES the SOCIAL
RESPONSIBILITY OF BUSINESSES, and the extent to
which they meet legal, ethical and economic
responsibilities, as established by shareholders.
 Corporate citizenship is a RECOGNITION
 That a business, corporation or business-like
organisation, has social, cultural and environmental
responsibilities to the community
 In which it seeks a licence to operate, as well as
economic and financial ones to its shareholders or
immediate stakeholders.
 Post et.al,2002 – “Involves the act of PROACTIVELY
addressing business and society issues while building
stakeholders partnership.
Nature of Corporate Citizenship
1. Universal- apply to all business

2. Adopt Strategic focus – Matching with situations
3. Fulfillment of social responsibility ( Economic, legal,
ethical & Philanthropic )
4. Stakeholder oriented

Benefits of Corporate Citizen
Improves the
environment
improve
Build goodwill
morale
sharpens
Good
understanding of
relations with
what the company
stakeholders
is all about

Stages of Corporate Citizenship
 Philip Mirvis and Brandley Googins at the center for
corporate citizenship at Boston College.
 The development of the corporate citizenship model reflects a
stage by stage process . The companies move through 5
stages and constitute 7 dimensions.

Developmental Challenges triggering
movement of Corporate Citizenship
Stage 5
The companies face different
transformin
development challenges at
g
each stage from stage 1 to 5
thus challenge to gain
Stage 4
creditability , as the company Commitment
Integrated
grow the challenge are to build
capacity , create coherence and
deepen commitment. Stage 3
Innovative Coherence
Stage 2
Engaged Capacity
Stage 1
Jaswal,SCOE-Department of Creditability
Dr Ashish RElementary MBA
Stage 1 Stage 2 Stage 3 Stage 4 Stage 5
Elementary Engaged Innovative Integrated transforming
Citizenship Jobs, profits Voluntary promotion Stakeholder Sustainability of Change the
Concept & Taxes of human welfare management triple bottom game
Environmental line
protection
Strategic Legal License to operate Business case Value Market
Intent compliance proposition creation or
social change
Leadership Lip service- Supporter in the loop Steward, on top Champion in Visioner ahed
out of touch of it front of it of the pack
Dimensions Structural Marginal staff Functional ownership Cross functional Organizational Mainsteam
driven co-ordination alignment business
driven
Issue Defensive Reactive policies Responsive Pro-Active Defining
Management programs system
Stakeholder Unilateral Interactive Mutual Partnership Multi

relationships influence alliance organization
transparency Side Public relations Public reporting Assurance Full disclosure
Protection
Examples General Nestle and Shell Oil Baxter BP Unilever
Electric (GE) International
CSR & Stakeholders
• Meaning of Stakeholders
Individuals, groups or organizations that are
concerned with the performance of business.
Stakeholders directly or indirectly
affected/Influence by/to the performance of the
business therefore they are concerned with
business activities.
• It can be categorized into Internal & External
stakeholders
Company
Types of Stakeholders
Internal/ External/
Primary secondary
 Suppliers
 Employees
 Society
 Shareholders
 Government
 Owner
 Community
 Creditors
 Customers

Responsibilities of business towards
different stakeholders
Responsibility towards Customers
Responsibility towards Shareholders
Responsibility towards Workers /

Employees
Responsibility towards Community
Responsibility towards Government

Quality
Avoid Monopolistic Fair Price

Competition
Attend Complaints Advertising

Customers
Regular After Sales service

Supply
Customer Safety R&D

Responsibility towards
Shareholders

Run the
business
Efficiently
Shareholders Payment
obligation of dividend
Sharehol
ders
Public Information to the

Image shareholders
Innovation &
Growth

Responsibility towards Workers /
Employees

Fair
Wages
A Company Code
Opportunity
Of Conduct
Workers/Emplo
yees
Proper Training & Workplace safety
Promotion Standard
Proper Trade Union

Recognition Rights

Provide Workers with Opportunities
and time
Spread of
Education
Organize meeting and
Avoid monopolistic
discussion Groups
Competion
Regular Periodic and
Avoid Antisocial and
Fair open
Unethical Meetings
Competition
Commu
nity
Provide recreation Facilities-

Sports,art Music
Healthy environment-Pollution Help to theImprove Public Services and
Other
Free Local Facilities
Responsibilities
GovernmentProvide Financial and Technical
help
Dr Ashish R Jaswal,SCOE-Department of MBA Upliftment of weaker Section
Responsibility towards Government
 Abide by laws(Local ,State and National)

 Co-operation(Formulation and legislation of constructive laws
 Payment of taxes & dues(Regularly,Fully and Honestly)
 Other responsibilities- encourage to reduce corruption in public
service.(Avoid Monopoistic Practice and No Adultertaion)
 In the words of Peter Drucker “Management must

maintain wealth producing resources intact by
making adequate profits to offset the risk of
economic activity. It must besides increasing the
wealth–creating and wealth-producing capacity of
these resources, also increases the wealth of
society.”
Stakeholders
Interests
Identification of stakeholders
• Who
Discovering &Understand their

interest
• Carrying and preventing forward movement
Stakeholders Analysis
Bottom Of The Pyramid
Opportunities
What is BOP? Explain

economic potential of it

Four Consumer
Tiers
Annual per capita
Income
Tiers Population in
millions
More than $ 20000 1 75-

100
$1500-$ 2&3 1500-1750

20000
Less than $ 4 4000

1500
Concept developed by Stuart L Hart and C K

Prahalad 2002m)The fortune of BoP)
The Invisible Opportunity
 Assumption 1- The poor are not our target consumers because with our
current cost structures, we cannot profitably compete for that market
 Assumption 2- The poor cannot afford and have no use for the products
and services sold in developed markets.
 Assumption 3 – Only developed markets appreciate and will pay for new
technology, the poor can use the previous generation of technology.
 Assumption 4- The bottom of the pyramid is not important to the long term
viability of our business, we can leave Tier 4 to government & Nonprofits.
 Assumptions 5- Managers are not excited by business challenges that have
a humanitarian dimension
 Assumption6-Intellectual excitement is in developed markets. It is hard to
find talented managers who want to work at the bottom of pyramid.

The challenge for MNC is to cater to this
segment of market by combining features like
Low cost, good quality , sustainability and
Drivers of Innovation Implications for MNC’s
profitability to its products
Increased access among poor to TV& Tier 4 is Becoming Aware of Many
Information products & Services and is aspiring to
share the benefits.
Deregulation & the diminishing role of A more hospitable investment climate
govt. & the international Aid for MNCs entering developing
countries & more cooperation from non
govt. organizations.
Global overcapacity combined with Tier 4 represents a huge untapped

intense competition in tier 1,2&3 market for profitable growth.
The need to discourage migration of MNCs must create products &services

overcrowded urban centers. for rural population.
Unilever own analysis of
Nirma & HLL competition
NIRMA HLL HLL (High End
(WHEEL) Products)
Total Sales ($ 150 100 180
Million)
Gross Margin 18 18 25
%
ROCE % 121 93 22
Nirma Vs HLL in India’s detergent

market (1999)
ROCE = Earnings Before Interest and Tax (EBIT) /
Capital Employed.
Each of these 4 elements demand innovation in
technology , business models and management
processes and business leader must be willing to
experiment, collaborate, empower locals & create new
sources of competitive advantage & wealth
Creating
Access to credit
Buying
power Income Generation
 Distribution
System Consumer Educatio
 Communication The
Link Sustainable
Commercial Developme
Shaping
Improving
Access
infrastructure nt
Aspirations
at the bottom SELF
of pyramid
 Targeted Product
Tailoring Development
local
solutions  Bottom Up Innovation
Unit 2
Course Code:401

1. Explain the Nature, Scope and significance of
Sustainable Development
1.Concept
2.What all is involved in Implementation of SD
3.Three Elements to be sustainable
4.Defination
5.Need & Importance
6.ESD

Ability to be maintained at a certain rate or level
Avoidance of the Depletion of

Natural Resources in order to
maintain ecological
Dr Ashish RBalance
Jaswal,SCOE-Department of MBA
Concept
 Sustainable development is a road map ,
 the action plan for achieving sustainability in any activity that
uses resources and where immediate and intergenerational
replication is demanded.
 Sustainable development is development that meets the need of
the present without compromising the ability of future
generations to meet their own needs.
 It contains two major concepts :
 The concept of needs in particular the essential needs of the
worlds poor to which overriding priority should be given
 The idea of limitations imposed by the state of technology &
social organization on the environments ability to meet
present & future needs

401 Managing For Sustainability
Sustainable development imply the
implementation of several conditions
 Preserving the overall balance .

 Respect for the environment.
 Preventing the depletion of natural
resources.
 Reduced production of waste.
 Systematic organization of production
&energy consumption must be
implemented.

401 Managing For Sustainability
Development must combine 3 main
elements in order to be sustainable
• Sociopolitical sustainability
• Environmental sustainability
• Economical sustainability
Equitab
Bearabl le
Social
e
Sustainable `
Economic Environment
Dr Ashish R Jaswal,SCOE-Department of MBA Viable

Definitions

Need & Importance of
Sustainable Development

Education for sustainable
development
• “ Education is the most powerful weapon you can use to
change the world” – Nelson Mandela
• Components of Education
Legislation –The process of Making or enacting
Law
Policy-Course of action adopted intetionally
Finance
Curriculum
Instruction
Learning
Assessment

Self governance or Self rule

Domestic Product

It provides a means by which the
wealthy people would be the
trustees of trusts that looked after
the welfare of the people in general.
Based on the principle

that all people are equal
and deserve equal rights
and opportunities.
Unit 3
Course Code:401

Written Account Of Something That One
Has Observed, Heard, Done, Or Investigated.

Environmental Impact
Assessment(EIA)
1. Definition
2. Objectives
3. Methodology
4. Guiding Principles
5. Participants
6. Process
7. Importance

EIA-Defination
• Environmental Impact Assessment is defined as an

activity designed to identify the impact on the
environment
• systematic process of identifying future consequences
of a current or proposed action
• widely accepted as a tool to ensure sustained
development with minimum environmental
degradation.
• New development project is planned which is likely to
affect environmental quality

EIA Methodology
1. The first step in EIA method is to determine whether

the project under consideration follows the jurisdiction
of the relevant acts and regulations and if so, whether
it is likely to create a significant environmental
disruption
2. EIA is undertaken and the environmental impact
statement (EIS) is prepared.
3. EIS is open to public scrutiny and is reviewed at public
hearings.
4. The development project may be (i) accepted or (ii)
accepted with amendments or (iii) an alternative
proposal is accepted or (iv) rejected.

Guiding Principles
1. Participation:
• An appropriate and timely access to the process for all
interested parties.
2. Transparency:
• All assessment decisions and their basis should be open
and accessible.
3. Certainty:
• The process and timing of the assessment should be
agreed by all participants in advance.
4. Accountability:
• The decision makers of all parties are responsible for their
action and decisions under the assessment process.

Guiding Principles
5. Credibility:
• Assessment is undertaken with professionalism and
objectivity.
6. Cost effectiveness:
• The assessment process and its outcomes will ensure
environmental protection at the least cost to the society.
7. Flexibility:
• The assessment process should be able to deal efficiently
with any proposal and decision making situation.
8. Practicality:
• The information and outputs provided by the assessment
process are readily usable in decision making and
planning.

Participants in EIA Process
1. Proponent:
• Government or Private Agency which initiates the project.
2. Decision maker:
• Designated individual or group.
3. Assessor:
• Agency responsible for the preparation of EIS.
4. Reviewer:
• Individual/Agency/Board.
5. Expert advisers, Media and Public, Environmental
organisations

Process

Importance of EIA
1. EIA is potentially a useful component of good

environmental management.
2. It is the Government policy that any industrial project
has to obtain EIA clearance from the Ministry of
Environment before approval by the planning
commission.

Life Cycle Analysis
 Definition
 Involvement in LCA
 Components of LCA
 Steps in LCA

Life Cycle Analysis
 Life cycle Analysis is the factual analysis

of a product’s entire life cycle in terms of
sustainability.
 LCA is a tool designed to evaluate
potential impacts of the production, use,
and waste management of goods.

The 4 steps of LCA methodology
• The standards are provided by

the International Organisation for
Standardisation (ISO) in ISO 14040 and
14044, and describe the four main
phases of an LCA:
1. Goal And Scope,
2. Inventory Analysis,
3. Impact Assessment
4. And Interpretation.

THE GOAL AND SCOPE
 (Often subjective) choices are

described,
 The reason for executing the LCA,
 A precise definition of the product
and its life cycle,
 And a description of the system
boundaries.

Inventory analysis of
extractions and emissions
Look at all the environmental

inputs and outputs associated
with a product or service
 Such as the use of raw materials
and energy, the emission of
pollutants and the waste streams.

LIFE CYCLE IMPACT
ASSESSMENT (LCIA)
 Draw the conclusions that allow you to
make better business decisions.
 Classify the environmental impacts,
evaluate them by what is most important
to your company, and translate them
into environmental themes such as
global warming or human health.

INTERPRETATION PHASE
 Check that your conclusions are well-substantiated.

 Test whether conclusions are adequately supported
by the data and by the procedures used.

1.
SOCIAL IMPACT ASSESMENT
Defination
Types of social impact
SAC
benefits

A Social Impact Assessment
 is a process of research, planning and

the management of social change or
consequences (positive and negative,
intended and unintended) arising from
policies, plans, developments and
projects
 Social impact is the effect an
organization's actions have on the well
being of the community
 SIA is used to predict and mitigate
negative impacts and identify
opportunities to enhance benefits for

Social Impact?
Social impacts as ‘the

consequences to human
populations of any public or
private actions that alter the ways
in which people live, work, play,
relate to one another, organize to
meet their needs, and generally
cope as members of society’.
Seek to identify the impacts on
people who benefits and who loses
Types of social impacts
• Lifestyle impacts – on the way people behave and relate to
family, friends
• Cultural impacts – on shared customs, obligations, values,
language, religious belief and other elements which make a
social or ethnic group distinct
• Community impacts – on infrastructure, services, voluntary
organisations, activity networks and cohesion
• Quality of life impacts – on sense of place, aesthetics and
heritage, perception of belonging, security and aspirations for
the future
• Health impacts – on mental, physical and social well being,
although these aspects are also the subject of health impact
assessment
Social Assessment Process
Cycle

Benefits of SIA
 Provide clear and comprehensive knowledge
 It helps the decision-making process to achieve
social goals and to engage the community in the
process.
 Enable greater sensitivity of the target audience to
social impacts
 Provide a step-by-step procedures for undertaking
social impact assessments in a participatory
manner
 Help project implementers evolve mechanisms
whereby adverse social impacts can be effectively
mitigated
Unit 4
Course Code:401

Probity-the quality of having
Compliance-Formal the act of obeying an strong moral principles; honesty
order, rule, or request
Dr Ashish R Jaswal,SCOE-Department of MBA and decency.
Relevant Theories:
1.Agency theory,
2.Transaction cost theory,
3.Stakeholder theory.
4. Friedman„s theory of csr.

Our limited capacity to
understand business situations
Actions taken in an individual's best

interests, which can create uncertainty
in dealings and mistrust between
parties
To find the supplier To monitor quality

To purchase the component

Shareholders Theory
 Shareholders theory introduced by Milton Friedman.
 “There is one and only one social responsibility of
business: to use its resources to engage in activities
designed to increase its profits so long as it stays within
the rules of the game, which is to say, engages in open
and free competition, without deception or fraud.”
 The idea of the shareholder theory is that managers
primarily have a duty to maximize shareholders‟
interests in the way that is still permitted by law or
social values.
 Puts laws and ethics as control mechanism how company
conducts business.

Stakeholder Theory
 Introduction
 Stakeholder Framework
 Focus
 Approaches

Stakeholder Theory
 Stakeholder theory is introduced

by Edward Freeman in 1988.
 According to stakeholder theory,
business leaders‟ duty is to balance
the shareholders‟ interests with other
stakeholders‟ interests.
 Stakeholder theory demands that
interests of all stakeholders should be
considered.

Stake Holder Framework

The stakeholder theory focus in three main
aspects
1. A DESCRIPTIVE AND EMPIRICAL VIEW. A descriptive

approach has been used by the literature to explain the
nature of the firm, how managers and boards think about
managing or about its constituencies´ interests, how
corporations are actuall managed, This approach expands
both to explanatory and predictive proposals.
2. AN INSTRUMENTAL APPROACH. Instrumental studies try
to show how adherence to stakeholder principles allows
to achieve corporate objectives as well or better than
other theories.
3. A NORMATIVE PERSPECTIVE explores the function,
moral or philosophical aims of the corporation.

 Suggests the purpose of the firm is to serve broader societal
interests beyond economic value creation for shareholders alone
 The very purpose of the firm is…to serve as a vehicle for
coordinating stakeholder interests”
 Theory extends the concept of ownership of the firm beyond that of
the traditional legal or economic owners of the firm

Stakeholder theory
approaches -
 STRATEGIC APPROACH
Stakeholders are means to generating a profit for shareholders.
 MULTIFIDUCIARY APPROACH views the firm as having a fiduciary
responsibility to all stakeholders
 SYNTHESIS APPROACH
The corporation has a moral and ethical dutyto stakeholders, but the
fiduciary responsibility remains solely to shareholders

Corporate Governance Code
 Defination
 Objectives
 Need
 Committee and its Recommendation on Code

Unit :5
Course Code:401


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• Course :Managing For Sustainability

CSR As per Company act

e Purpose Impact Benefit

CSR As Risk Medium to mitigate operational impact

Corporate Philanthropy & Sponsorship

The survival of organization depends upon

Its varies for different organizations.

Dr Ashish R Jaswal,SCOE-Department of MBA

Dr Ashish R Jaswal,SCOE-Department of MBA

Dr Ashish R Jaswal,SCOE-Department of MBA

1. Universal- apply to all business

Dr Ashish R Jaswal,SCOE-Department of MBA

Dr Ashish R Jaswal,SCOE-Department of MBA

Dr Ashish R Jaswal,SCOE-Department of MBA

Stakeholder Unilateral Interactive Mutual Partnership Multi

Dr Ashish R Jaswal,SCOE-Department of MBA

Responsibility towards Customers

Responsibility towards Shareholders

Responsibility towards Workers /

Responsibility towards Community

Responsibility towards Government

Avoid Monopolistic Fair Price

Attend Complaints Advertising

Regular After Sales service

Customer Safety R&D

Dr Ashish R Jaswal,SCOE-Department of MBA

Dr Ashish R Jaswal,SCOE-Department of MBA

Public Information to the

Dr Ashish R Jaswal,SCOE-Department of MBA

Dr Ashish R Jaswal,SCOE-Department of MBA

Proper Trade Union

Dr Ashish R Jaswal,SCOE-Department of MBA

Provide recreation Facilities-

 Abide by laws(Local ,State and National)

 In the words of Peter Drucker “Management must

Discovering &Understand their

What is BOP? Explain

Dr Ashish R Jaswal,SCOE-Department of MBA

More than $ 20000 1 75-

$1500-$ 2&3 1500-1750

Less than $ 4 4000

Concept developed by Stuart L Hart and C K

Dr Ashish R Jaswal,SCOE-Department of MBA

Global overcapacity combined with Tier 4 represents a huge untapped

The need to discourage migration of MNCs must create products &services

Nirma Vs HLL in India’s detergent

Dr Ashish R Jaswal,SCOE-Department of MBA

Dr Ashish R Jaswal,SCOE-Department of MBA

Avoidance of the Depletion of

Dr Ashish R Jaswal,SCOE-Department of MBA

 Preserving the overall balance .

Dr Ashish R Jaswal,SCOE-Department of MBA

Dr Ashish R Jaswal,SCOE-Department of MBA Viable

Dr Ashish R Jaswal,SCOE-Department of MBA

Dr Ashish R Jaswal,SCOE-Department of MBA

Dr Ashish R Jaswal,SCOE-Department of MBA

Dr Ashish R Jaswal,SCOE-Department of MBA

Dr Ashish R Jaswal,SCOE-Department of MBA

Based on the principle

Dr Ashish R Jaswal,SCOE-Department of MBA

Dr Ashish R Jaswal,SCOE-Department of MBA

Dr Ashish R Jaswal,SCOE-Department of MBA

• Environmental Impact Assessment is defined as an

Dr Ashish R Jaswal,SCOE-Department of MBA