Fiinovation webinar on affirmative action and livelihood

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PROMOTION OF LIVELIHOOD THROUGH AFFIRMATIVE
ACTION CORPORATE SOCIAL RESPONSIBILITY
Presentation by Soumitro Chakraborty Chief
Executive Officer, Fiinovation
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ABOUT THE MENTOR
Mentor of the Webinar Soumitro Chakraborty, CEO,
Fiinovation About Fiinovation A CSR based
research organization working in areas of
education, livelihood, environment and health
since last seven years Assists businesses to
support requirements of communities by designing
and implementation of sustainable
projects Through practices such as CSR-CSO
Partnership, Initiative Design, Initiative
Management, Monitoring and Evaluation, Impact
Assessment, Sustainability Reporting Fiinovation
facilitates corporations for promotion of social
enterprises
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AGENDA OF THE WEBINAR

• Understanding the alignment between CSR and
  Affirmative Action
• Exploring livelihood opportunities for SC/ST
  youth
• Highlighting the role of corporations in CSR and
  Affirmative Action
• Understanding how livelihood initiatives can be
  linked to CSR and Affirmative Action
• Insights on CSR initiatives targeting livelihood
  generation for the marginalised
• Update on new policies as per 'Union
  Budget-2016'

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AFFIRMATIVE ACTION WHAT DOES IT MEAN?

• Positive action, reverse discrimination
• It promotes inclusive development, equality on
  all aspects
• Focus on upliftment of the historically
  marginalised
• Important policy tool for holistic social
  development in many countries, including
  developed ones
• In India, its implemented through 'Reservation'
  or the 'Quota' system

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AFFIRMATIVE ACTION INDIA INC

• In 2006, then Prime Minister Dr. Manmohan Singh
  appealed to India Inc to incorporate affirmative
  action policies to diversify workforce
• Department of Public Enterprises (DPE)
  guidelines on CSR and Human Resources for Central
  Public Sector Enterprises were released in 2010
• Non Voluntary Guidelines were established by
  Ministry of Corporate Affairs in 2011 which was
  later adopted by SEBI
• CII have been promoting affirmative action
  through Skill Trainings, Scholarships, employment
  opportunities, education etc.

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CORPORATE SOCIAL RESPONSIBILITY

• A strategic business management concept to
  obtain a balance of economic, environmental and
  social imperatives
• Globally the concept of CSR encompasses all
  related concepts -Triple Bottom Line, Strategic
  Philanthropy, Shared Value, Corporate
  Sustainability, Business Responsibility
• Also known as Corporate Citizenship in North
  America and Corporate Responsibility in Europe

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CSR IN INDIA

• Pre-Independence era restricted to charitable
  and religious philanthropy by businessmen rich
  farmers
• Father of the nation Mahatma Gandhi urged rich
  to pool resources for Indias upliftment, giving
  rise to trusteeship movement.
• Post-Independence, PSUs govt. led initiatives
  played prime role in social development sector
• It became a strategic business concept after the
  influx of MNCs in India
• In 2013, The Companies Act, quantified it and
  made it mandatory for companies which fall under
  the CSR ambit

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LIVELIHOOD

• Definition
• It is the means of supporting one's existence,
  especially financially or vocationally
• Livelihood is a set of activities, involving
  securing water, food, fodder, medicine, shelter,
  clothing and the capacity to acquire above
  necessities working either individually or as a
  group by using endowments (both human and
  material) for meeting the requirements of the
  self and his/her household on a sustainable basis
  with dignity.
• Livelihood helps in tapping new opportunities,
  vulnerability reduction
• Livelihood has direct links with the
  environment, and global warming is having adverse
  consequences on livelihood of the people

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LIVELIHOOD IN INDIA

• The Work Participation Rate as per Census 2011
  was 39.79
• Majority of rural population dependent on
  agriculture and allied sectors as means of
  livelihood
• Majority in urban areas are engaged in service
  and manufacturing sectors
• 12 million people enter India's workforce every
  year
• India creates 5.5 million jobs every year to
  accommodate its growing workforce

Source 68th Round, National Sample Survey
Office, Employment Exchange Statistics, National
Skill Development Corporation Skill Development
Reports
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WHY PROMOTE LIVELIHOOD?

• Create jobs/employment for the youth
• Reduce vulnerability of the marginalised
  sections
• Increase Purchasing Power Parity
• Optimal use of resources, maximise scale
• Stable livelihood substantially increases
  income, asset ownership, self-esteem and social
  participation among the marginalised
• It has cross-linkage with health, education,
  environment etc.

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LIVELIHOOD CHALLENGES IN INDIA

• Lack of education and skills among the working
  class
• Lack of income generation opportunities
• Lack of infrastructural support
• Lack of financial support, social safety nets
• High dependency on climatic conditions/monsoons
• Large scale migration to bigger cities and
  towns in search of jobs and employment
  opportunities
• Geo-political issues, population pressure

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HOW TO PROMOTE LIVELIHOOD?

• Infrastructure development
• Skill development trainings
• Financial technological support
• Creating employment and self-employment
  opportunities
• Building forward-backward linkages (value chain
  management)

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APPROACH LIVELIHOOD INTERVENTIONS

• Spatial Approach Promoting livelihoods in a
  specified geographical area, such as a region,
  sub-region, command area or a watershed
• Sectoral Approach Promoting livelihoods along a
  sector of the economy such as agriculture, or a
  sub-sector such as cotton
• Segmental Approach Promoting livelihoods for a
  vulnerable segment of the population, such as
  landless households, tribal, women, SC/ST/OBC and
  the differently-abled

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PROMOTION OF LIVELIHOOD SKILL DEVELOPMENT

• Need to develop and empower the human capital to
  ensure India's global competitiveness
• 3 crore skilled people will be needed in the
  construction industry alone in the next five
  years. Retail will need 1.6 crore skilled people,
  automobile 40 lakh, logistics 1 crore, and
  textile and clothing industries, 1.42 crore
  people
• It is estimated that only 2.3 of the workforce
  in India has undergone formal skill training as
  compared to 68 in the UK, 75 in Germany, 52 in
  USA, 80 in Japan and 96 in South Korea
• Target is to develop skills of 500 million
  Indians in less than 10 years with considerable
  help from the private sector as per National
  Skill Development Corporation
• Narrow time-line to harness the demographic
  advantage which is predicted to last until 2040

Source National Skill Development Corporation,
Union ministry of State for Skill development and
Entrepreneurship
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CSR LIVELIHOOD

• Tata Group, HUL, HDFC, Axis Bank, Aditya Birla
  Group, ITC etc are involved in livelihood
  promotion activities
• Chambers of commerce such as CII are also
  engaged in livelihood promotion activities
• Major focus of CSR has been health, education
  and sanitation livelihood is yet to become the
  top priority
• There is a need to create employable skilled
  opportunities in labor intensive industries and
  sectors
• In livelihood, major focus is now on skill
  development for higher growth and sustainability

Source KPMG Survey 2015, NGOBox Survey of BSE
Listed Companies 2015
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SKILL DEVELOPMENT SC/ST COMMUNITIES

• Need for skill development higher among these
  backward communities as they are most vulnerable
  (as discussed in previous webinars)
• Lack of financial support, education,
  technology, infrastructure, social capital etc.
• Majority mostly engaged in unsustainable and low
  productivity practices
• High rate of unemployment, seasonal unemployment
• Lack of self employment opportunities leading to
  migration, rural distress

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SKILL DEVELOPMENT GOVT. INTERVENTIONS

• National Skill Development Corporation India
  (NSDC) was setup in 2009 as a one of its kind,
  Public-Private-Partnership company with the
  primary mandate of catalysing the skills
  landscape (500 million skilled workforce) in
  India
• Some of the major skill development programmes
  are
• Craftmen Training Scheme,
• Skill Development Initative on Modular Employable
  skill,
• National Rural Livelihoods Mission, Rural Self
  employment Training Institutes,
• Skill Training for Employment promotion amongst
  Urban Poor,
• Support to training and employment Programme
  (STEP),
• Parvaz,
• Entrepreneurial skill development Programme,
• Hunar Se Rozgar Scheme,
• Integrated Skill Development Scheme,
• Udaan,
• Roshni
• NRLM is the largest livelihood programme support
  by World Bank with a credit line of 1 billion
• Skill India Mission will directly benefit more
  than 94000 SC, ST candidates

Source National Skill Development Corporation,
Union Ministry of Skill development and
Entrepreneurship
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CONTINUED
DT
Training and Apprentice Divisions have been
transferred from Labour department from April
2015Comprises government and private ITIs, PPP
skill schools and other institutions25 new
advanced training institutes to be setup
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BUDGET 2016 PROPOSITION (DIRECT)

• Boost to SC/ST entrepreneurship through Stand Up
  India scheme
• Rs 500 cr has been allocated to promote
  entrepreneurship
• At least 2.5 lakh entrepreneurs will benefitting
  from it
• All Bank branches to provide support to at least
  two projects
• Rs 10 lakh to Rs 1 crore will be provided as
  loan to them for new ventures

Category SC/ST Women
Example 1 1.5 Lakh (Men Women) 1 Lakh (General SC/ST)
Example 2 1.5 Lakh (Men) 1 Lakh (SC/ST)
Example 3 2.5 Lakh (Women SC/ST) 2.5 Lakh (Women SC/ST)
Source Budget Speech, Union Finance Minister
Arun Jaitley
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CONTINUED

• Year of Economic Empowerment for SC/ST
  Entrepreneurs
• 125th Birth Anniversary of Dr. B.R. Ambedkar
• National Scheduled Caste and Scheduled Tribe Hub
  in the MSME Ministry
• Partnerships with industry associations such as
  DICCI, CII
• The Hub will provide professional support to
  Scheduled Caste and Scheduled Tribe entrepreneurs
  
• to fulfil the obligations under the Central
  Government procurement policy 2012,
• adopt global best practices and
• leverage the Stand Up India initiative

Source Budget Speech, Union Finance Minister
Arun Jaitley
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PUBLIC PROCUREMENT POLICY FOR MSEs ORDER 2012

• Overall procurement of minimum of 20 per cent,
  of total annual purchases of products produced
  and services from MSEs
• Out of 20 per cent target of annual procurement
  from Micro and Small Enterprises, a sub-target of
  20 per cent (i.e., 4 per cent out of 20 per cent)
  shall be earmarked for procurement from Micro and
  Small Enterprises owned by the Scheduled Caste or
  the Scheduled Tribe entrepreneurs
• Enhancing participation of Scheduled Castes or
  Scheduled Tribes in government procurement, the
  central government ministries, departments and
  public sector undertakings
• Special Vendor Development Programmes or
  Buyer-Seller Meets shall be conducted by the
  departments/public sector undertakings for SC,
  ST
• Outreach programmes shall be conducted by
  National Small Industries Corporation to cover
  more and more Micro and Small Enterprises from SC
  or ST under its schemes of consortia formation
  and
• National Small Industries Corporation shall open
  a special window for SCs or STs under its Single
  Point Registration Scheme (SPRS).

Source Budget Speech, Union Finance Minister
Arun Jaitley
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BUDGET 2016 PROPOSITION (INDIRECT)

• 28.5 lakh hectares will be brought under
  irrigation under Pradhan Mantri Krishi Sinchai
  Yojana
• At least 5 lakh farm ponds and dug wells in rain
  fed areas and 10 lakh compost pits for production
  of organic manure
• Soil Health Card Scheme to cover 14 cr farm
  holdings by Mar, 2017
• The Parmparagat Krishi Vikas Yojana which will
  bring 5 lakh acres under organic farming over a
  three year period
• The Government has launched a value chain based
  organic farming scheme called Organic Value
  Chain Development in North East Region

Source Budget Speech, Union Finance Minister
Arun Jaitley
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CONTINUED

• The government is implementing the Unified
  Agriculture Marketing scheme which envisages a
  common e-market platform for APMCs will be
  launched on 14th April- Ambedkar Jayanti
• To reduce the burden of loan repayment on
  farmers, a provision of Rs 15,000 crore has been
  made in the BE 2016-17 towards interest
  subvention
• Government has approved the path breaking Prime
  Minister Fasal Bima Yojana and allocated Rs 5,500
  cr
• Animal Husbandry Rs 850 cr for the next few
  years
• first, the Pashudhan Sanjivani, an animal
  wellness programme and provision of Animal Health
  Cards (Nakul Swasthya Patra)
• second, an advanced breeding technology
• third, Creation of E-Pashudhan Haat, an e
  market portal for connecting breeders and
  farmers and
• fourth, a National Genomic Centre for indigenous
  breeds

Source Budget Speech, Union Finance Minister
Arun Jaitley
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CONTINUED

• Digital Literacy Mission scheme for rural India
  to cover around 6 crore households within the
  next 3 years
• A sum of Rs 2,000 crore to meet the initial cost
  of providing these LPG connections for 1.5 cr BPL
  households in 2016-17
• A new health protection scheme which will
  provide health cover up to Rs. 1 lakh per family
• Increased share in SSA and 62 new Navodaya
  Vidyalayas will be opened in the remaining
  uncovered districts over the next two years
• Higher Education Financing Agency (HEFA) with an
  initial capital base of Rs 1,000 cr
• Under Pradhan Mantri Kaushal Vikas Yojna 1500
  Multi Skill Training Institutes will be set up
  across the country with Rs 1700 cr

Source Budget Speech, Union Finance Minister
Arun Jaitley
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CONTINUED

• Government of India will pay the Employee
  Pension Scheme contribution of 8.33 for all new
  employees enrolling in EPFO for the first three
  years of their employment (Job Creation and
  bringing into books informal employees)
• 100 Model Career Centres to be operational by
  the end of 2016-17 - National Career Service
• Entrepreneurs will be able to operate buses on
  various routes, subject to certain efficiency and
  safety norms - Amendments to Motor Vehicles Act
• 100 FDI will be allowed through Foreign
  Investment Promotion Board route in marketing of
  food products produced and manufactured in India

Source Budget Speech, Union Finance Minister
Arun Jaitley
26
BENEFITS FOR YOUTH (SC/ST)

• 2 crore tax payers in this category who will get
  a relief of Rs 3,000 in their tax liability many
  of whom would be from SC/ST communities
• Increase the limit of deduction in respect of
  rent paid under section 80GG from Rs 24,000 per
  annum to Rs 60,000 per annum, which should
  provide relief to those who live in rented houses
• A special patent regime with 10 rate of tax on
  income from worldwide exploitation of patents
  developed and registered in India
• Deduction for additional interest of Rs 50,000
  per annum for loans up to Rs 35 lakh sanctioned
  during the next financial year, provided the
  value of the house does not exceed Rs 50 lakh
• Krishi Kalyan Cess, _at_ 0.5 on all taxable
  services to benefit farmers

Source Budget Speech, Union Finance Minister
Arun Jaitley
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BENEFITS FOR ENTREPRENEURS (SC/ST)

• Corporate Tax from 30 to 25 over a period,
  accompanied by rationalization and removal of
  various tax exemptions and incentives
• The benefit of section 10AA to new SEZ units
  will be available to those units which commence
  activity before 31.3.2020
• 100 deduction of profits for 3 out of 5 years
  for startups set up during April 2016 to March
  2019
• Big relief to a large number of assesses with
  turnover of maximum 2 cr in the MSME category as
  it frees them from the burden of maintaining
  detailed books of account and getting audit done

Source Budget Speech, Union Finance Minister
Arun Jaitley
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CONTINUED

• Suitable changes in customs and excise duty
  rates on certain inputs, raw materials,
  intermediaries and components and certain other
  goods and simplify procedures, so as to reduce
  costs and improve competitiveness of domestic
  industry
• 100 deduction for profits to an undertaking
  from a housing project for flats up to 30 sq.
  metres in four metro cities and 60 sq. metres in
  other cities, approved during June 2016 to March
  2019, and is completed within three years of the
  approval
• Equilization Levy to tap tax on income accruing
  to foreign e-commerce companies from India

Source Budget Speech, Union Finance Minister
Arun Jaitley
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SKILL INDIA CAMPAIGN

• Prime Minister Narendra Modi launched the Skill
  India Mission on 15th July 2015 unveiling the new
  National Policy for Skill Development
  Entrepreneurship
• Aim to become Human Resource Capital of the
  World by providing 4-5 crore skilled
  professionals to work abroad
• Develop ITIs like the IITs
• Skill India Mission target is to provide skill
  trainings to 40.02 crore by 2022
• Skill loans will be made available for 34 lakh
  youth
• Scientific mapping of job market and manpower
  requirements
• Linked to Pradhan Mantri Kaushal Vikas Yojana,
  Startup India, Make in India and other campaigns
• The country's first skill development university
  will be set up in Maharashtra
• Pradhan Mantri Kaushal Vikas Yojana completed 10
  lakh enrolments under Skill India till Feb 2016

Source Union Ministry of Skill development and
Entrepreneurship
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SKILL INDIA INDUSTRY SUPPORT

• Tata companies are training thousands of youth
  across India in skill sets that make them
  employable and productive. TCS was the first
  company to sign an MoU with National Skills
  Development Corporation (NSDC) under project
  Udaan in 2011
• To better equip aspirant youths of Nagaland, the
  state government and TATA Motors Private Limited
  have started a PPP mode project by upgrading
  Diesel Mechanic Trade, the automotive section of
  the Industrial Training Institute (ITI), Kohima
• ILFS Skills Development Corporation in
  partnership with National Skills Development
  Corporation (NSDC), aims to train 40 lakh people
  by 2022 through a network of 100 multi skill
  Institutes and 300 single skill Schools

Source Website Tata Group, ILFS Skills, CII
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CONTINUED

• CII has been supporting the Ministry of Skill
  Development Entrepreneurship, Ministry of
  Labour Employment and Ministry of Rural
  Development and other ministries to create a
  conducive ecosystem for skill development in
  India, especially targeting SC/ST Communities
• NSDC has urged the corporations to promote skill
  development through CSR targeting 150 million
  people

Source Website Tata Group, ILFS Skills, CII
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CII SKILL DEVELOPMENT

• Supports Various Ministries to promote Skill
  Development
• Targets SC/ST Communities to provide skill
  development trainings
• It launched the India Skills Report in 2015
• Provided recommendations for the new Skill
  policy
• CII members are adopting and upgrading 390 ITIs
  and strengthening the system through
  implementation of recommendations
• CII has set up Skill Hubs in Chindwara, Madhya
  Pradesh Bhiwadi, Rajasthan Kendrapara, Odisha
  and Skill Gurukuls in association with Pan IIT
  (PARFI)
• CII is also working on various on ground
  initiatives with PSUs like HPCL, IOCL, NSFDC etc
  and organising Job fairs across India

Source Website Tata Group, ILFS Skills, CII
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ALIGNMENT OF AFFIRMATIVE ACTION CSR BY INDIA INC

• Reliance Industries Project Drishti initiated
  to bring back eyesight of people from the
  economically weaker sections
• Tata Group Providing books, stationary, school
  bags etc. to SC/ST students of 46 senior
  secondary government schools
• ONGC Emphasises on higher education,
  scholarship, grant for youth from the
  less-priviledged sections of societies
• Coca Cola Programme for empowerment of 5
  million women entrepreneurs

Source Corporate Citizen Volume 2, Issue 1
34
CONTINUED

• Amity Amitasha and Atulasha programmes for
  SC/ST boys and girls providing free education
• Bajaj Electricals Social work in areas such as
  education, rural development and environment
• GlaxoSmithKline Donates funds, medicines and
  equipments towards improving health and education
• BHEL Indian Airlines Adopted 56 villages
  having nearly 80,000 inhabitants

Source Corporate Citizen Volume 2, Issue 1
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ALIGNMENT OF AA, CSR SKILL DEVELOPMENT
What
Providing skill development trainings under CSR
to the SC/ST communities
Why
SC/ST communities most vulnerable, marginalised
and are the poorest sections in India
Where
Geographical areas with high percentage of SC/ST
communities
How
Community based interventions, skill development
centres, EDP, ERC, supporting govt. initiatives
36
THE WAY FORWARD

• The way forward can be elaborated by
  highlighting few CSR models by companies which
  can be incorporated by other companies
• HUL contributed 42 crores in watershed
  development initiative by partnering with the
  government under MGNREGA, extending soil and
  water conservation wages to the people.
• Axis Bank Foundation work in Dang, Gujarat to
  enhance livelihood and food security of the
  tribal communities through conservation of
  natural resources and providing them with options
  and techniques for increased income from
  agriculture.
• Rashtriya Ispat Nigam Limited through Kaushal -
  a skill development programme designed
  exclusively for youth belong to SCs of
  Vishakapatanam, imparts placement-based training
  to beneficiaries in garment construction
  technique and industrial sewing machine operator
  (basic and advanced).
• Similar initiatives can be taken up by
  corporations under their corporate social
  responsibility targeting SC and ST communities.

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SUGGESTED TRIPARTITE MODEL
Illustration
Corporation Xs total CSR expenditure Rs 500 cr
Product Handicrafts / Food Processing
Registration The Companies Act, 2013
Organization Structure
Operations Sourcing from community members, processing of finished products, marketing
Sharing of Revenues Yearly dividends, remuneration of community members, salaries to staff, operational expenditure, expansion costs
Entity
Board
Managers
Managers
Managers
SC/ST Communities
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BENEFITS OF SUCH INITIATIVES

• Provide an opportunity to gain financial
  sustainability independence for the SC/ST
  communities
• CSR grant will allow corporations to spend money
  on livelihood issues, not otherwise funded
• Assets of entity will belong to the community
  and cannot be sold off for private financial gain
• People, who are local stakeholders in the area
  of benefit, play a leading role in the entity
  ensuring inclusive development
• Local community are the shareholders who ensure
  accountability of the entity to the community
• The entity will be able to generate profits or a
  surplus that can be re-invested or distributed
  for community benefits

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THANK YOU
Contribution by
Soumitro Chakraborty Chief Executive Officer,
Fiinovation
Rahul Choudhury Dy. Manager - Content, Fiinovation
Rohit Srivastava Graphic Designer, Fiinovation