This article is written by Bhavya Mittal of 3rd Semester of National University for Study and Research In Law
ABSTRACT
This paper aims to explain the role of corporate social responsibility in shaping environmental law. The points here include being like why this concept was brought up or the concept involving CSR. The author tries to explain the impact of the environment leading to the evolution of this concept. As we all know how a huge impact is left by today’s business on the environment. We cannot ignore the reality of how the firm overuse the resources or the pollutants emitted by them. This all gradually led to the degradation of the ecosystem causing an inevitable threat to our biological environment. So instead of ignoring all the threats caused by the enterprises, crucial steps should be taken by the government.
This paper is divided into three categories i.e. the introduction, the main body, and at last the conclusion. The introduction contains the meaning as well as the background of CSR and some of its concepts revolving around the environment.
The main body contains the concepts revolving around CSR further it goes on with how just profit-making businesses are connected with the environment or what is the environmental impact of CSR. It then comes to India and talks about the ECSR initiatives taken by India to increase its environmental stability with some of the case laws. The paper doesn’t end here it brings the unique concept of green competitive advantage and even talks about the recent development done around environmental corporate social responsibility.
At last, comes the conclusion that emphasizes the need for corporate firms to incorporate environmental laws in their business for not the betterment of any individual but for the betterment of society.
Keywords–
Environmental stability, Environmental corporate social responsibility, The concept around CSR, Business and the protection of CSR, Green competitive advantage
INTRODUCTION
Corporate social responsibility or short CSR is one of the principle concepts used by various businesses to contribute to various committees and societies voluntarily without any force of legislation[1]. Although this concept isn’t such an old concept it is recently adopted and gained popularity among businesses. Under CSR the acts are done voluntarily which are related to taking account of the environment as well as society and not just keeping the finances as their priority. CSR is seen as the triple bottom line approach by the United Nations Industrial Development as it balances all the economic, environmental, and social imperatives and not comprising the expectations of shareholders and stakeholders. The recent pandemic i.e. COVID-19 pandemic made all sectors promote CSR by integrating social and environmental aspects into business activities and excluding all unethical practices.
For a long time, Indian history was filled with love for nature i.e. the environment. But with the advancement of science and technology society started to lose its value towards the environment, leading the judiciary to intervene in the protection of the environment. This gradually led to the development of corporate social responsibility to lead to an environment that is pollution free and consider it a duty under the constitution to provide for and improve the environment. So to protect an environment as defined under the constitution as well, corporate social responsibility was even recognized as one of the enactments done under the legislature.
India earlier was considered one of the social service states. But as time flew, the government starts to adopt privatization and globalization. The earlier public sector slowly turned to the private sector. Since this privatization or rather industrialization couldn’t be stopped the concept of corporate social responsibility was introduced for the betterment of society, where the corporate sector would be responsible for maintaining the social interest through their functions.
The Companies Act,2013 introduced the Board Of Indian Companies mandate for Corporate Social Responsibility. The government also got a positive response from the industrialist in the private, public, and multinational companies.[2]
THE CONCEPT EVOLVING AROUND CSR
Merely just considered a charity the concept has gone beyond it, now it is an ethical act required from the companies. It is now a commitment by the stakeholders towards society. The availability of certain brands in the market is now recognized by the number of corporate activities done by the brand, in short, the increase in corporate activities is now engaging their products more with the public for example the recent brand value of MamaEarth has started to increase due to its engagement more with the organic farming.
CSR is on the concept that the maximum profit and contribution of the stockholder’s wealth should be in such a way that it should be contributing to the social profit by the profitable corporation. It implies an obligation of the organization toward society by adding the word responsibility. Although it is an obligation still it is done voluntarily by integrating social and environmental issues with their business operation. CSR is discussed in Section 135 under The Companies Act,2023 which was amended from the Companies Act, of 1956.[3]
BUSINESS AND THE PROTECTION OF THE ENVIRONMENT
One of the most important issues that business leaders and policymakers should consider is environmental protection. The environment in layman’s terms refers to the surrounding of man which includes both man-made and natural. The surrounding is filled with resources necessary for human life. What includes these natural resources are land, water, air, flora, and fauna as well as all the raw materials, while the man-made ones include institutions. all the cultural heritage. But due to industrial activity, the quality of the environment is constantly deteriorating. In many cities, it has now become a common view to see, such as Delhi, Kolkata, etc. Pollution or the eviction of deleterious substances in the environment will lead to harmful health hazards. Businesses have a duty not to only reduce pollution but also to safeguard environmental resources. Businesses control the financial as well as the human resources of the country. Just by substitution of the low-quality manufacturing process or inputting some innovative ideas a large amount of environmental pollution can be reduced.
Steps that the business can take to protect the environment are [4]
- Commitment to developing, creating, and modifying the enterprise’s environmental protection by the top management.
- All the divisions of workers share a common commitment towards environmental protection in the enterprise should be ensured.
- Strict patterns should be maintained to incur on high-quality technology, raw materials, implementation of the scientific disposal system, and improvement of the skill of staff for the management of pollution.
- Adhering to the rules and regulations mentioned by the government
- Participating in governmental programs, which include the management of hazardous materials, cleanup of the river, planting of a tree, and control of deforestation.
- To the environment organized centers and seminars should be held, where the expert can share their knowledge with the customers, dealers, and suppliers.
ENIVROMANTAL IMPACT ON CSR
CSR aims to diminish or try to diminish any harmful effect their business process has on the environment. Activities that they focus on are.
- Use of water
- Use of energy
- Emission
- management of waste
- recycling
- Having eco-friendly offices and policies for business travels [5]
Out of these, some has important significance in both financial and environmental view.
ECSR will help to reduce the risks related to business, improve its reputation, and provide opportunities for saving costs. To make an environmental difference even the basic step can be a good start of it as even the simplest efficient use of energy can generate a lot of savings. Examples like switching off the economic requirement when it is not in the usage or decreasing the usage of water or even diminishing the wastage of paper.
Thinking about the environment can bring a lot of advantages to the business as customers usually are attracted more towards environment-friendly companies.
ECSR INITIATIVES TAKEN BY THE INDIAN COMPANIES
To maintain the environment some companies have even stood up so that people are made aware ad resources are protected.
- TATA Steel Company
The company along with the Odisha government started the target “Mission 2020 for Agricultural Development”. This aims at the improvement of the lives of poor farmers by increasing their opportunities for them to start proper training in the fields related to horticulture or practices related to irrigation.
This will help not only create employment but will also create 3 acres of cropland through the irrigational facilities. Under this scheme, 60 acres of the wasteland which was under the National Horticulture Mission now converted to the plantations of cashew, mango, and lemon plantations.
- Cocoa Cola
Cocoa Cola one of the leading beverage companies started the mission “Alag Karo Har Teen Din Bin “. The mission aimed for the segregation of wet and dry garbage and easy disposal management. It even aimed at the prevention of waste dumped in landfills. This was one of the initiative steps taken by the company for the protection of the environment. [6]
In India under Section 16 of the Environment Protection Act, 1986 offenses Where any offence under this Act has been committed by a company, every person who, at the time the offence was committed, was directly in charge of, and was responsible for, the company for the conduct of the business of the company, as well as the company, shall be deemed to be guilty of the offence and shall be liable to be proceeded against and punished accordingly: Provided that nothing contained in this sub-section shall render any such person liable to any punishment provided in this Act, if he proves that the offence was committed without his knowledge or that he exercised all due diligence to prevent the commission of such offence.[7]
There are some important landmarks and judgments related to the responsibility of a company when it comes to the environment, like in the case of M.C. Mehta V. Union of India[8]also known as the Taj Trapezium Case, there was a huge threat to the Taj Mahal one of the wonders due to pouring of acid rain, The acid rain was caused to mixture of pollution incurred from the Mathura Refineries. A Public Interest Litigation filed in 1984 comprised to take speedy and strict action against the company for inculcating a threat to one of the historical monuments of India. Since this was the result of environmental pollution the court passed the judgment to ban the use of coal and coke and switch to Compressed Natural Gas.
In the second case of T. Dhamodar Rao v. Special Officer[9], the high court in its judgment said that it is the duty of every person even if it’s the state to protect the environment.
In another case of Mohd Hazi Rafeeq v. State of Uttranchal[10], the court said that it is not just the duty but the need to keep the environment at its priority level even if it goes against the interest of business.
The case of Rural Litigation Entitlement Kendra v. State of UP[11] is the first kind of case which included a balance of ecology and environment.
In the case of the Indian Council for Enviro-legal Action v. Union of India[12], the environment of a village state in Rajasthan became highly polluted due to leftover sludge by the industries that were licensed to produce certain acids. The Hon’ble Supreme Court directed the central government to all the necessary steps for improving and protecting the quality of the AIR 2003 Raj 286, RLW 2003 (2) Raj 1012, 2003 (2) WLC 465 environment.
In Vijay Singh Punia v. State of Rajasthan[13], the court imposed a 15 percent turnover of the dye and printing industry in Rajasthan as it was causing water pollution.
RECENT DEVELOPMENTS IN RELATION TO ECSR
The recent time company has started to adopt the Model Environmental Policy as its commitment towards the environment has become absolute in the various procedures of manufacturing. Recently in order to achieve the environmental stability company has started to work towards its objective like
- To minimize the impact of the environment there should be the adoption of proper operational appliances and working technology to supervise.
- Continuous target to reduce pollution or waste by minimizing the use of resources
- Maintain a workforce which is motivated and responds quickly to the environmental emergency situation
For Example, Bharat Petroleum Corporation limited had recently launched the Project Boond Initiative in order to provide rain water harvesters in the villages of India and try to reduce the water shortage. Tata Power’s Energy has started the initiative for the check dams in Mahindra and Mahindra Project as well as Hariyali project for providing a green cover in the valley of Araku.
CONCEPT OF GREEM COMPETITIVE ADVANTAGE
The concept describes that now the firm is in such a condition it cannot be stimulated or copied by others, it is under which the firm holds a position about environmental management or sustainable innovation. Through Green capability i.e. using the current resources and knowledge company creates renewed green organizational capabilities, which are considered as a dynamic nature in the process of business within the organization. ECSR is a multi-dimensional idea relating to the firm’s sustainability, performance, and governance, and this multi-dimension of the CSR direction the Green Competitive Advantage through ecological management.
The Establishment of their green dynamic should be made permanent and trustable by the firms. This strategy of ecology is used by the firms to establish their shape of green competitiveness.
To establish a green image and sustainability firms use the green business process as their volunteer responsibility. To shape their green competitiveness firms utilize ecological strategies. The idea of establishing a green business as a process and considering it as a duty, they will able to establish a green image and sustainable track in their firm. competitive sustainable edge can be established through engaging themselves in various inventive and green initiatives. When it comes to competition there exists a positive meeting between the performance of the business and concerns related to the environment.
CONCLUSION
The new system is now adopted by industries, state bodies, and municipalities due to the dynamic change in the environment. Industries have now changed their way from just being profit-seeking firms to being sensitive towards their surroundings and constantly working for the betterment of the environment. One of the best concepts incorporated both in the public and private industry rather is whether it is a small or large firm in CSR. The increased awareness and voluntary responsibility taken by the firm to ensure sustainability and economic stability shows that the concept of CSR is not just merely talked about but also taken into action in reality. As with the advancement of science and technology the condition of the environment has started to get degrade day by day so now it’s the responsibility of the firm to take a step ahead from just thinking about their profit and incorporate environmental law in their business by promoting eco-friendly procedures. the regulation derived by the government is mainly incorporated into the business to conduct programs related to the environment.
The concept of CSR has now only not become famous in the legal arena but had also increased judicial activism. It the not just the legal or constitutional duty to protect the environment but also the ethical duty of every individual and corporation. The right to Pollution free environment is everyone’s duty to achieve.
REFERENCES
1. Corporate Social Responsibility (CSR): The Role of Government in promoting CSR, Springer Link, available at https://link.springer.com/article/10.1007/s13132-023-01185-0
2. Corporate Social Responsibility and Environmental protection, legalserviceindia, available at https://www.legalservicesindia.com/article/1920/Corporate-Social-Responsibility-and-Environmental-Protection.html
3.S16, Environment Protection Act ,1986
4. M.C. Mehta And Anr v Union Of India & Ors (1987) AIR 1086, 1987 SCR (1) 819
5. Environment Protection and CSR, ipleaders, available at https://blog.ipleaders.in/environmental-protection-csr/,last seen on 11/07/2023
6. Business and Environmental Protection: Causes and Types of Pollution, Need for Pollution Control and Role of Business in Environment Protection, GeeksforGeeks, available at https://www.geeksforgeeks.org/business-and-environmental-protection-causes-and-types-of-pollution-need-for-pollution-control-and-role-of-business-in-environment-protection/
7.S135, Companies Act,2013
8.Corporate Social Responsibility,niBusiness, available at https://www.nibusinessinfo.co.uk/content/corporate-social-responsibility-environmental-impact#:~:text=Environmental%20CSR%20aims%20to%20reduce,water%20use
9. T. Dhamodar Rao v. Special Officer (1987) AIR AP 171
10. Mohd Hazi Rafeeq v. State of Uttranchal (2006) AIR 18 Utr
11 Rural Litigation Entitlement Kendra v. State of UP (1985) AIR 652, 1985 SCR (3) 169
12. Indian Council for Enviro-legal Action v. Union of India (1996) AIR 1446, 1996 SCC (3)212
13. Vijay Singh Punia v. State of Rajasthan, (2003) AIR Raj 286, RLW 2003 (2) Raj 1012, 2003 (2) WLC 465
[1] Corporate Social Responsibility (CSR): The Role of Government in promoting CSR, Springer Link, available at https://link.springer.com/article/10.1007/s13132-023-01185-0 last seen on 10/7/2023
[2] Corporate Social Responsibility and Environmental protection, legalserviceindia, available at https://www.legalservicesindia.com/article/1920/Corporate-Social-Responsibility-and-Environmental-Protection.html last seen on 10/7/2023
[3] S135, Companies Act ,2013
[4] Corporate Social Responsibility,niBusiness ,available at https://www.nibusinessinfo.co.uk/content/corporate-social-responsibility-environmental-impact#:~:text=Environmental%20CSR%20aims%20to%20reduce,water%20use ,last seen on 11/07.2023
[5] Business and Environmental Protection: Causes and Types of Pollution, Need for Pollution Control and Role of Business in Environment Protection, greeksforgeeks,available at https://www.geeksforgeeks.org/business-and-environmental-protection-causes-and-types-of-pollution-need-for-pollution-control-and-role-of-business-in-environment-protection/ ,last seen on 11/07/2023
[6] Environment Protection and CSR, ipleaders, available at https://blog.ipleaders.in/environmental-protection-csr/ ,last seen on 11/07/2023
[7] S16, Environment Protection Act ,1986
[8] M.C. Mehta And Anr v Union Of India & Ors (1987) AIR 1086, 1987 SCR (1) 819
[9] T. Dhamodar Rao v. Special Officer (1987) AIR AP 171
[10] Mohd Hazi Rafeeq v. State of Uttranchal (2006) AIR 18 Utr
[11] Rural Litigation Entitlement Kendra v. State of UP (1985) AIR 652, 1985 SCR (3) 169
[12] Indian Council for Enviro-legal Action v. Union of India (1996) AIR 1446, 1996 SCC (3) 212
[13] Vijay Singh Punia v. State of Rajasthan, (2003) AIR Raj 286, RLW 2003 (2) Raj 1012, 2003 (2) WLC 465
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