Tobacco and CSR (Corporate Social Responsibility)

#1
I was invited for a talk on Green Procurement by the Indian Institute of Management, Bangalore, at their ADB sponsored workshop on Environmental Management. The programme for the day was held at the Infosys campus, Bangalore and the conference arrangement was excellent. I had a hectic schedule, flying down from Pune to Bangalore early morning, travelling to Infosys campus (taking about 2 hrs), delivering the lecture and leaving for the Bangalore airport by 14.30 hrs. In between this hectic schedule I had some interesting discussion and I thought I should share that with you.

One of the speakers at the workshop was Niranjan Khatri, General Manager, ITC Hotels, a good friend of mine. The previous evening, I understand, he hosted a dinner for the delegates of the workshop at the ITC Hotel in Bangalore. We sat for lunch together to catch up on things that happened since we met last. We were joined by a lady from IIM, Bangalore. While Niranjan was explaining the various efforts taken by ITC Hotels - paltinum rating for the building, zero discharge, zero waste, rain water harvesting, solar energy use, CDM, social forestry etc.,- the lady interjected: "After all you are a Cigarette Company; how can you kill people and still claim that you are a green company ?". Having faced such questions and comments for many years, Niranjan replied that ITC is carrying out a legal activity, licenced by the Government of India , that they follow all the rules of the Government and pay their taxes without fail; in addition the company has taken steps to strategically move away from Cigarettes over a period of time with majority of sales coming from other business in a few years from now. Further ITC's CSR activities are well recognized all over the world; ITC e-choupal has changed the way farmers sold their produce and it got recognition from all over the world for the innovative application of ICT. ITC Hotels are among the greenest hotels in the world. If ITC withdraws from the cigarette business, the vacuum will be filled by other brands; or beedies (tobacco wound in tendu leaves, a cheap product for smoking tobacco) would take over the market left by cigarettes. What happens to millions of tobacco farmers and farm labourers if ITC withdraws from its Cigarette business ?..the discussion went on like this and the lady was not convinced that Cigarette manufacturing/ sales and CSR could go hand in hand.

I have heard similar arguments agains ITC earlier too, when Sivakumar, CEO of ITC Agro gave a lecture on e-chaupal at our Institute a few years ago. I thought ITC has been pragmatic; they had inherited the Cigarette business and unlike other cigarette companies in India they have branched off to other businesses to move away from the cigarette business over a period of time. No doubt, cigarette business brings in a lot of profit compared to other businesses of ITC. Is it a crime to continue with the Cigarette business and engage in activities beneficial to the society and the environment ? Are CSR and Sustainability meant only for non-cigarette companies ?

I thought I should intervene at this point and asked the lady which company in her opinion was doing a great job in CSR in India. She immediately replied "Tatas". Tatas have been known in India for their philanthropy and CSR activities. They were responsible for establishing the Indian Institute of Science, Bangalore (Popularly known as Tata Institute in Bangalore, established more than a century ago), Tata Institute of Fundamental Research, Mumbai, Tata Steel, various hospitals etc., and are generally acknowledged as an ethically sound company. I asked the lady:"Do you know that Tatas made their early money through trading in drugs?". Would that make all the good work done by Tatas "null and void" ? Alfred Nobel got his money from Dynamite; does it mean the Nobel Peace Prize does not have any value ? Watson stole the data for solving the DNA structure..does he deserve the Nobel Prize that he got with Crick ? These posers made the lady think...we could complete our lunch without much further talk on CSR and ITC.

In my native language there have been many proverbs. To sample a few:

a) Don't get into the origin of Rishis and Rivers
b) Money begotten by selling a dog does not bark
c) Money begotten by selling fish does not stink

These indicate that such debates have been going on for many centuries....we learn from them and move on.
 
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harry

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#2
They are both right - except that one is looking at the issue from the opening of her silo and the other is looking at things more on a global perspective.
 
#3
harry;bt508 said:
They are both right - except that one is looking at the issue from the opening of her silo and the other is looking at things more on a global perspective.
Thank you Harry for an excellent summary of the case.

With kind regards,

Ramakrishnan
 
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