Corporates Should Support the Rule of Law

Corporates Should Support the Rule of Law

January 16, 2020 | CSR

The time has come to align self-interest and public interest in support of the rule of law and constitutional values.

I have often talked about the continuum of sarkaar, samaaj, and bazaar, and why, for a successful society, these three sectors must work together in a fine balance.

Ideally, sarkaar, or the state, should not grab too much power, bazaar, or the market, should not flout the rule of law or appropriate public resources, and vigilantes from the samaaj, or civil society, should not take the law into their own hands.
This requires awareness and active participation from all citizens. After all, we are citizens first; our primary identity is not as a subject of the state or as a consumer for the market. As citizens, how do we then help build a good society?

The bazaar’s interest in the rule of law

There are many interests between samaaj and sarkaar; bazaar and sarkaar; as well as between samaaj and bazaar. For the purpose of this article, we will examine the congruence of interest between samaaj (society) and bazaar (markets). And it starts with the rule of law.

“No business can thrive without social stability outside its gates.”

We all want and need the rule of law to be upheld. In fact the bazaar—or at least the modern corporation as we know it—would not exist if the rule of law had not created the limited liability company 300 years ago. This allowed innovation to flourish over the centuries, and also provided for the absorption of failure, because wherever there is innovation, there is failure. It is because of the rule of law that companies can fail without going under themselves; and therefore, for their own sake, corporations have a great stake in upholding it. They need the enforceability of contracts, protection of property, availability of fair competition, and so on, otherwise they simply cannot function. But even beyond this, they need the law to be upheld by society at large, because no business can thrive without social stability outside its gates.

Civil society and business therefore have more in common than either believe. Sure, in some cases, civil society has to position itself against business interests, when those interests are being deployed unfairly on the ground. For instance, in the case of public goods like water and land commons, or with environmental issues like pollution and contamination, civil society and business knock up against each other. But they also have a common concern—to keep the sarkaar in check.

Keeping the sarkaar in check

State power worldwide tends to accumulate, and it is to the advantage of both business and civil society, to make sure that the state does not abuse its own power.

Many corporations have been subject to the vagaries of state power while running their businesses; excessive discretionary power also adversely affects the climate in which businesses operate. If the alignment of samaaj and bazaar is understood and worked on, it helps restrain the state.

For example, civil society institutions and business corporations might together, or separately, appeal to the state on poorly framed laws. In the recent proposal to criminalise non-compliance of CSR, both samaaj and bazaar would have been adversely affected.

Both successfully voiced strong reservations against it, and it was rolled back.

“We all need good laws, and an independent, impartial, and efficient judiciary to verify the constitutionality of those laws.”

We all need good laws, and an independent, impartial, and efficient judiciary to verify the constitutionality of those laws. We all require equal access to the justice system. We also need effective public institutions that help uphold the rule of law. It is the only way to both empower the bazaar and uphold the rights of the country’s citizens.

The samaaj has an interest in the rule of law as well, as it is critical for addressing access issues, especially for the poor. Civil society organisations (CSOs) representing samaaj are often driven by passion and a commitment to rights and freedoms.

Sometimes, at great personal risk, they go up against the power of the state and corporations, to create campaigns, build institutions, and push for more agency for people who are left out. Civil society must however learn to communicate better the long term benefits of such work to business.

Because, the bazaar itself cannot do this work. Though they benefit indirectly, corporations cannot support or implement politically sensitive programs, and risk the fallout of such action. It would make them vulnerable to all sorts of state action.

But they can certainly do more than what they’re doing at the moment.

With the civil society institutions that they trust and already have a relationship with, they can, and should, give core institutional support to continue work beyond project-based funding. Even if they do just this, it strengthens civil society capacity to take on issues of rights and exclusions that are adjacent to their work on service delivery.

It’s time to take big bets

Swami Vivekananda said, “Take risks in your life. If you win, you can lead, if you lose, you can guide.”

Indian philanthropy doesn’t take enough risk. However, it cannot achieve its potential without risk-taking. It’s good to keep honouring service delivery improvements, but it’s time to look at our society as a whole, and for the philanthropic sector to step up and get into more important areas such as access to justice. And the congruent interest of samaaj and bazaar is exactly why.

From a recent Boston Consulting Group report—‘Total Societal Impact- A New Lens for Strategy’, it’s clear that corporations which align with samaaj’s ideals will be better off in the long run. There is now exhaustive research that shows that the non-financial side of business is linked to its financial side, and that companies that do well when it comes to ESG—environmental, social, and governance issues—also consistently show better results on their bottom line.

Can we—as corporations and philanthropists—pledge that we will no longer do only incremental work, but will try something transformational? The time has come to align self-interest and the public interest in support of the rule of law and constitutional values.

The common within uncommon ground

It doesn’t have to be the state versus civil society, or business versus civil society, or the state versus business. They are not neccessarily antithetical to each other.

Society is successful when it reduces the friction for the three to co-create solutions. And it’s important for all the three sectors to recognise that—to discover the common within the uncommon ground.

It is an especially opportune time for business and civil society to act more creatively from their own, unrecognised common ground. Poised at a new decade, we can together ensure that this country’s solemn promise to itself—to secure liberty and justice, social, economic, and political—for all its citizens, will be met, and met in abundance.

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WestBridge Capital and Rohini Nilekani Philanthropies in research centre tie-up

WestBridge Capital and Rohini Nilekani Philanthropies in research centre tie-up

October 1, 2019 | CSR

Private equity firm WestBridge Capital and Rohini Nilekani Philanthropies have jointly committed Rs 5.5 crore to set up two new centres at the Bengaluru-based research institution, Ashoka Trust for Research in Ecology and the Environment (ATREE).

The two will engage with policy leaders on issues such as climate change and look at using the research grant to offer sustainable business opportunities for local communities.

The Centre for Policy Design and Centre for Social and Environmental Innovation — to be set up at ATREE’s campus — will focus on research and formulation of sustainable and scalable policies to address socio-environmental problems. They are expected to tackle critical problems such as invasive species, climate management, and food systems.

“We need to do more research and also create an environment where the research leads to better policy making,” Rohini Nilekani, who is also a board member of ATREE, said. ATREE is among India’s few environmental organisations that do research over long periods to understand the impact of shifts in environment, which is valuable when faced with climate change, she said. Sandeep Singhal, MD of WestBridge Capital, said the growing conversation about climate change triggered the grant to promote environment related issues.

“The situation is like everyone’s house is on fire,” Singhal said. “(Influencing) policies take time, it requires investment”. ATREE, besides providing policy inputs to tackle environmental degradation, is also looking to provide sustainable income for local communities living near forests. It also has set up programmes to commercially exploit invading species such as Lantana in Biligiriranga hills in Karnataka.

“With biodiversity, water and climate change being our focus areas, we intend to look at issues from an interdisciplinary standpoint and to put the research to use to address real world problems. In fact, the Westbridge and Rohini’s initiative to fund the project has triggered interest among other funders too, with whom we are seeing potential participation in future,” Nitin Pandit, director of ATREE, said.

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Company law to change CSR landscape

Company law to change CSR landscape

August 12, 2013 | CSR

Experts see mixed blessings from new company law; some say the move will result in rise in CSR consulting. The CSR provisions could have a “cascading impact” on philanthropy, according to Rohini Nilekani, chairperson and founder of non-profit Arghyam and wife of Nandan Nilekani, a co-founder of software service firm Infosys Ltd and chairman of the Unique Identification Authority of India that aims to provide a unique identity number to all residents of India.

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Companies Act Must Amplify, not constrain the idea of CSR

Companies Act Must Amplify, not constrain the idea of CSR

August 11, 2013 | CSR

he Companies Bill will soon become a law. My particular knowledge and concern is clearly about only one part of it, which requires that companies of a certain size and profitability contribute 2% of profits to corporate social responsibility (CSR). Many of us, including myself, have opposed this idea vociferously for multiple reasons, and this deliberation is on record for those who wish to know more.

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Philanthropy in India Is Taking Its Own Route

Philanthropy in India Is Taking Its Own Route

March 21, 2013 | CSR

A debate was going on about a government proposal to make it compulsory for companies to spend 2% of their net pro􀁿ts on corporate social responsibility (CSR). Rohini Nilekani, philanthropist and chairperson of Arghyam, a foundation she set up with a private endowment to work on water and sanitation issues in India, says she has been “against the 2% rule from the beginning” because “I don’t think government should outsource its governance. And, secondly, making it mandatory is going to straightjacket [CSR] in a way that may not necessarily yield the best results. But now that it’s been done, we just have to make the best of it.”

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The Challenge of Inequity

The Challenge of Inequity

October 30, 2011 | CSR

Solutions remain elusive as industry and civil society leaders grapple with issues.

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‘Challenge creation of islands in society’

‘Challenge creation of islands in society’

May 16, 2010 | CSR

Rohini Nilekani is essentially a philanthropist at heart and passionate about development issues. The fact that she has featured in the Forbes’ list of Asia Pacific’s 48 ‘Heroes Of Philanthropy’ for the second consecutive year proves this.
She speaks to Shruti Khairnar on middle class values and corporate social responsibilities.

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Uncommon Ground – A Conflict Of Paradigms

Uncommon Ground – A Conflict Of Paradigms

May 8, 2009 | CSR

The demand for limited fresh water has brought the issue to the centre of the debate on development.
At summertime, thoughts turn naturally to water. For millions of citizens, especially women, it is a time of extreme shortage, and for ever more creative coping mechanisms. Many states have improved access to lifeline water, but there is still a long way to go.
In terms of total availability of fresh water, things are not going to improve. Even though water is a renewable resource, it is finite, and per capita availability of water in India has gone down from 6,008 cu. m. in 1947 to 1,820 cu. m. in 2001—it will dip further over the next 30 years.

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