Prof Satyabhusan Dash
Professor Marketing, IIM Lucknow & Chairperson-CMEE
Bharat Petroleum (BPCL) Chair Professor in Customer Care
IISD's invited Distinguished Guest Blog

The understanding of CSR is even more relevant in current times as Government of India has taken decision to treat COVID-19 as a notified disaster, the Ministry of Corporate Affairs (vide its General Circular No. 10/2020 dated 23rd March, 2020), and expenditure for COVID-19 will be eligible as CSR activity. Companies have stepped up with their contribution to the PM CARES Fund and State Disaster Management Authority, expenditure on preventive health care, sanitation, quarantine facility and ex-gratia to workers. TATA group is again the front runner in response and have committed Rupees 1500 crores towards Corona relief. The group partnered with Sree Chitra Tirunal Institute to augment production of COVID-19 testing kit, signed MoU with CSIR-IGIB to improve knowledge about rapid and accurate diagnosis of COVID-19 are one among few ground breaking initiatives.

Centre for Marketing in Emerging Economy (CMEE) has conducted a study to understand the role of CSR in inducing commitment from employees and establish a strong employer brand. The TATA group companies were preferred for the study as the group proudly upholds the heritage of returning to society what it earns. The active engagement of the group and encouragement of leadership in corporate social responsibility has been the motivation to conduct the study with the organization.

The study was conducted in two phase on employees of employees 1). Tata Motor, 2). Tata Steel, 3). Tata Chemicals and 4). Tata Power. The first phase investigated about understanding of CSR among TATA group , awareness, importance to activities, its effect on individual and the overall corporate identity of the group. The second phase with a sample of 846 employees strengthen the understanding related to impact of CSR on employer brand. The study finds strong relationship between employee CSR perception on employee commitment and performance. The strong benevolent identity infuses strong identification with corporate brand. Moreover, the employees are benefitted in terms of improve psychological benefits (Peace of Mind) with corporate association.

Corporate house, which values CSR and has incorporated in its strategic decision making provide rich insights. Among the CSR activities, work done towards community is the most influential in terms of inducing loyalty. The statistical analysis shows that the 61% of employee, who have high perception of community development work are also highly commited to the firm followed by External stakeholder and economic related activities perception (59% each). This result signifies the importance of community developemnt by corporates on employee commitment to the firm. The work towards community focuses on education, health care, skill development, infrastructure, tribal issues etc. related with the local community. The work done for the local community acts as an indication, as one of the senior manager pointed out. External stateholder related activities refers to Maintaining Quality, R&D and Innovation, Customer Health & Safety, Candid Labelling, Responsible Marketing Communication, Customer Privacy, Supplier Assessment for Impact on Society and Environment, Aiding Capacity Building for Local Supplier where as Economic activities include Productivity, Profit Sharing, Shareholder Value and Dividend Policy.

Consciously or unconsciously, it's in the mind that if the company can do this much for the society how much can it do for the employees. (Male, Senior Manager, Exp 18 years, Mining)

Similarly, ethics and governance of the group plays a pivotal role in enforcing job performance from the employee. Our statistcal analsis finding suggsts that 76.5% of employees with high perception on Ethics and governance followed by Environment and Emplyee related activities (73% each) have percption of high job performance aswell. The ethics and governance aspects includes, the ethical code of conduct, compliance and vision of the company. It instills confidence in the employee and feeling of no wrong doing motivates them to perform better. The Chief Manager, TATA Steel Mentions - Consciously or unconsciously, it's in the mind that if the company can do this much for the society how much can it do for the employees.

Environmental activities refer to use of Clean Energy, Minimizing Water Uses, Biodiversity, Emission Control, Effluent & Waste Management, Greening the Environment, Type of Material Used where as Employee related actities inclue Building Effective Management-Union Relationships, Employee Profit Sharing, Employee Participation in Decision Making, Retiral and Health Benefits, Promoting Volunteerism.

The Employee's Review of the Brand TATA: as the Corporate that Cares
Further, the study investigates the influence of TATA's CSR performance in forming an identity of the brand. The employees identify TATA as a caring brand with a philosophy of giving back to its stakeholders, both the external and internal. The corporate brand is respect for both is competency as well as philanthropy.

The study finds that corporate social performance is equally important if not more in defining the personality of the firm. A caring personality of the employer attracts talent, which is very important in the current business environment where attrition rates are high. The brands can take cue from Tata's social performance to create a strong employer brand. When the employees were ask to rate to mark the role of CSR in continued association with firm, 85% of the respondent mentioned that it is one of the factors, which affects the decision to stay with organization. TATA group has created the corporate culture with precision. The cultural norm of giving back to society runs across length and breadth of company, which reflects in their recruitment as well; as shared by a General Manager of TATA Steel. Please refered to statement on the right hand side, in the green margin.

This study states that in the face of COVID19 outbreak companies have been proactively undertaking CSR activities for welfare of consumers and society at large. The two foundation pillars of employee loyalty, trust and confidence to businesses, are being put to the test during the time of crisis. Finding of this study provides empirical evidence on strong causal effect of perception on CSR activities undertaken by TATA on employee commitment and performance. Hence, our finding may motivate top management of various business houses to plan CSR policy more proactively and focus on undertaking activities relevant to consumer and society for winning employee loyalty.

The benevolent identity of the TATA group has created a unique corporate brand identity. The identity drives both horizontally and vertically across the group. The employees feel empowered and less skeptic. The culture within company reflects in the behavior of employee and brand image to the outside world.

Prof. Satyabhusan Dash is a Professor Marketing at IIM Lucknow and Chairperson-CMEE and Bharat Petroleum (BPCL) Chair Professor in Customer Care.

This is an IISD's Invited Guest Blog, under Distinguished Personality Category.