Liquor Prohibition – The Turning Point

Liquor has been a major talking point in the political atmosphere in India since as long as one can recall. And more recently now, because of the approaching assembly elections in some Indian states. Although prohibition of sale of liquor is not a fresh topic of concern , it is quite clear that in most states , the agenda of the respective state political parties is centered around it. With most parties announcing to be in favour of the ban and citing it as a solid electoral agenda , all we can hear from them lately is poll promises, the fate of which is yet uncertain.

While a few Indian states such as Gujarat , Nagaland , parts of Manipur , the Union Territory of Lakshadweep and more recently Bihar have categorically banned liquor, other states running for poles have pinned their hopes on the Liquor Ban . Most prominent are the states of Kerala and Tamil Nadu , in which parties have gone all clear in expressing their will to ban liquor if voted to power.

If we look closely at the picture of Kerala ,where prohibition is being carried out in a phased manner since 2014, the government has confined liquor licenses to only the five star hotels in the state. Contrary to this move, toddy is still sold legally in the state which renders the ban of other alcohols ineffective since a major chunk of the liquor consuming population in the rural areas and a small fragment in urban areas consumes the palm wine. Besides, availability of liquor in local liquor shops has been reported in spite of the prevailing ban. In terms of the economic impact , close to Rs. 2500 Cr of state revenue will be lost every year due to the ban. The Muslim League and Kerala Congress have also joined in to show their support for the declaration by the current CM Oommen Chandy.

A similar picture emerges in Tamil Nadu , where at a recent election campaign Jayalalithaa’s proposition to ban liquor after polls met with support from the masses, and predominantly from women. The political blame game was also witnessed when she blamed arch rival DMK of relaxing the ban in the past. The main target are the women electorates whom the parties are aiming to please through the proposed ban by citing their welfare.

In most states the political parties are playing the liquor card to woo the voters. Whether these parties stick to their poll promises is still to be seen and the consequences are yet to come to the forefront. Though in Bihar, the CM Nitish Kumar has been very fast at implementing the complete ban with effect from 5th April 2016, it is too early to predict the out-turn . And perhaps the reason for such swift action by the Bihar government was to bring back its credibility to the picture and please the women electorate -by citing women empowerment and welfare- who voted in his favour in large numbers. He has also promised to set up anti-addiction centers and the entire affair at the annual revenue loss of Rs. 2000 Cr.

Though the ban may see a strong support from the people and may prove to be a window to enhance the vote bank of the parties , it also imposes an additional responsibility on the government to ensure that there are no leakages in the system. The need for well formulated laws keeping in mind all the economic and social consequences become all the more important. For many communities , it is the main source economic activity and liquor is a thriving cottage industry in many states. In such cases, the government should also be well prepared to tackle the concerns of the people employed in these areas and ensure alternative opportunities. Apart from trying to manage the supply side factors of Alcohol, efforts must be made to tackle the demand for alcohol. In India , demand for alcohol is high among the youth which is due to social factors such as peer pressure, lack of public health awareness , unemployment and the likes which makes the situation appear grim. The policy initiatives to curb consumption of alcohol must be backed by spread of social awareness , de-addiction facilities and most importantly identifying and working on the causes for rise of alcoholism.

The Government and the masses should together discern the need for working towards such a cause. Political parties highlighting such issues in the face of elections should not lose momentum after the polls and be persistent with such efforts after the verdict of the people has been declared. The true motive of the parties must not be limited to gathering votes but it must also extend to public welfare. Though, such initiatives portray the political parties in a positive light , the undercurrent of such promises are not unfathomable.

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Corporate Social Responsibility – A New Perspective

 

Corporate Social Responsibility. We all have come across this word a number of times but haven’t really gone far to think about it.

In simple words, CSR (also called corporate conscience, corporate citizenship or responsible business) is a form of corporate self-regulation integrated into a business model.

Corporate social responsibility (CSR) promotes a vision of business accountability to a wide range of stakeholders, besides shareholders and investors. Key areas of concern are environmental protection and the wellbeing of employees, the community and civil society in general, both now and in the future.

But the question arises whether the companies are doing enough.

There are many big entities who have been actively engaged in the CSR activities, but unfortunately the number is relatively less. In order to encourage more entities to participate in the process of development of the society via- CSR, the Government of India has actually implemented the concept of CSR in the new Companies Act 2013.

What was supposed to be a “corporate self regulation” , a voluntary action has now become a mandated responsibility.

When we look closely at the real picture , we notice that a company which is fair in its dealings with all it’s stakeholders need not extenuate about CSR. But if a company engages in questionable practices , this can’t be remedied by paying lip-service to CSR.

Annual reports of listed companies have revealed that the companies with a questionable core business have devoted the most space to praising their CSR efforts. It is out of question, though , that companies which have taken such initiatives are better than the ones which have not.

But is it an apt remedy ? Wouldn’t it be far better to discourage such businesses with a high social cost at the first place? For a company which exploits the society, will it be justified to later on provide sanitary facilities, build schools and parks ?

Another aspect is that though large companies across the globe spend about a total of $20 billion dollars on CSR annually, the money, energy, and influence used to push popular CSR programs would be better spent either radically altering the way companies operate, or allowing better regulation—which would theoretically prevent companies from becoming being bad actors in the first place.

Ideally, the government rules and regulations are enough to curb the malpractices of the corporations- be it in terms of environmental damage or labour abuses. But , the presence of such practices is evidence enough that such regulations are too weak.

Corporates use the veil of CSR to their benefit. The research of relationship between CSR and consumer behaviour is relatively young, but it suggests that companies have already realised that their socially responsible behaviour has a direct impact on the consumer buying behaviour. It is used as a marketing tool to gain competitive advantage. This is because consumers are becoming increasingly aware of the companie’s practices due to the influence of media and better education. Infact,  Fifty-five percent of global online consumers across 60 countries say they are willing to pay more for products and services provided by companies that are committed to positive social and environmental impact, according to a new study by Nielsen.

 

Clearly, CSR has become an important criterion not only for corporate houses but also for the consumers and the society. Therefore, it becomes all the more important to understand the impact of CSR and also prompt the leading lights of corporate to take their social responsibility more seriously and do away with elevated social costs.