Corporate Social Responsibility

Under the guidance of Dr. S. K. Tapasvi

GROUP 9 SEC - A
AKSHIT MATHUR 13P004
ANUBHAV BAJPAI 13P009
KUSHAGRA GROVER 13P027
S SAMEER 13P039
TEJAS SHAH 13P046
SUNANDA MOHANTY 13P051

CSR AT AMUL
Index
1. About the company

2. CSR policy

3. The different CSR initiatives

4. Linkage between core business and its social initiatives

5. Social impacts

6. What in your view should be the focus of company’s CSR?

7. How it will benefit the company?

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The Birth of Amul
It all began when milk became a symbol of protest in the freedom movement. Amul was founded
in 1946 to stop the exploitation by middlemen. The seeds of this unusual saga were sown more
than 65 years back in Anand, a small town in the state of Gujarat in western India. The
exploitative trade practices followed by the local trade cartel triggered off the cooperative
movement. Angered by unfair and manipulative practices followed by the trade, the farmers of
the district approached the great Indian patriot Sardar Vallabhbhai Patel for a solution. He
advised them to get rid of middlemen and form their own co-operative, which would have
procurement, processing and marketing under their control.

In 1946, the farmers of this area went on a milk strike refusing to be cowed down by the cartel.
Under the inspiration of Sardar Patel, and the guidance of leaders like Morarji Desai and
Tribhuvandas Patel, they formed their own cooperative in 1946.

This co-operative, the Kaira District Co-operative Milk Producers Union Ltd. began with just two
village dairy co-operative societies and 247 litres of milk and is today better known as Amul
Dairy. Amul grew from strength to strength thanks to the inspired leadership of Tribhuvandas
Patel, the founder Chairman and the committed professionalism of Dr Verghese Kurien, who was
entrusted the task of running the dairy from 1950.

The then Prime Minister of India, Lal Bahadur Shastri decided that the same approach should
become the basis of a National Dairy Development policy. He understood that the success of
Amul could be attributed to four important factors. The farmers owned the dairy, their elected
representatives managed the village societies and the district union, they employed professionals
to operate the dairy and manage its business. Most importantly, the co-operatives were sensitive
to the needs of farmers and responsive to their demands.

At his instance in 1965 the National Dairy Development Board was set up with the basic objective
of replicating the Amul model. Dr. Kurien was chosen to head the institution as its Chairman and
asked to replicate this model throughout the country.

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CSR policy – The Amul Way

Corporate social responsibility (CSR) has been defined as the “commitment of business to
contribute to sustainable economic development working with employees, their families, the local
community, and society at large to improve their quality of life, in ways that are both good for
business and good for development.”
To meet with the CSR it is expected that a business in its entire procurement-production-
processing-marketing chain should focus on human development involving the producer, the
worker, the supplier, the consumer, the civil society, and the environment.
Indeed, a very tough task. Most businesses would certainly flounder in not being able to achieve
at least one or many of those expectations. But AMUL has shown the way.

The different CSR initiatives

1) CSR-sensitive Organisational Structure

AMUL is a three tier co-operative organisation. The first tier is the co-operative society at the
village, of which; milk producers are voluntary members, managing the co-operative through a
democratically elected 9-member managing committee, and doing business by purchasing milk
from members and selling it to the district level co-operative. There are more than 11,000 co-
operatives in villages of Gujarat.
The second tier is the district co-operative that processes milk into milk products, markets locally
and sells surplus to the state co-operative for national and international marketing. There are 12
district co-operatives each being managed by a 15-member board elected by the college
comprising the nominated representatives or chairmen of the village co-operatives.
Third tier is the state level co-operative - the Gujarat Co-operative Milk Marketing Federation
(GCMMF) responsible for national and international marketing of milk and milk products
produced and sold to it. The GCMMF is managed by the board democratically elected by and
from amongst the chairmen of the district co-operatives.
The entire three-tier structure with the GCMMF at its apex, is a unique institution because it
encompasses the entire chain from production of raw material to reaching the consumer with the
end product. Every function involves human intervention: 23.60 lakh primary milk producers;
35,000 rural workmen in more than 11,400 village societies; 12,000 workers in 15 dairy plants;
750 marketing professionals; 10,500 salesmen in distribution network and 600,000 salesmen in
retail network. Accumulation of human capital is sine qua non for the development and growth of
any enterprise or economy. The GCMMF is sensitive towards CSR. It believes that technology and
capital are replicable inputs but not the human capital. Since men are the basis for achieving the
CSR, the GCMMF lays emphasis on their development into competent, courteous, credible,
reliable, responsive communicators and performers.

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 2) CSR-sensitive Business Philosophy

The first step towards discharging the CSR is the business philosophy of the GCMMF. It is two-
fold: one, to serve the interests of milk producers and second, to provide quality products to
consumers as value for money. Evolution of an organisational system has ensured that the
corporate social responsibility towards the primary milk producers, village and the ecological
balance is fulfilled. The milk producers are paid for their milk in accordance with market forces
and realisation of value for their produce. Invariably the price paid to the member-producers in
Gujarat is higher by 15 per cent than the national average.

3) CSR-orientation To Distributors & Retailers

The GCMMF has identified the distributors and retailers are its important link in its vendor
supply chain. Through surveys the GCMMF found that 90% of the distributors do not get any
opportunity of exposure to latest management practices. The GCMMF realised that it was a
corporate social responsibility to strengthen the core business process of its distributors so as to
keep them in mainstream business and compete with those with formal training in management.
The GCMMF has developed and trained all its distributors through Value-Mission-Strategy
Workshops, competence building, Amul Yatra, Amul Quality Circle meetings, computerisation,
and electronic commerce activities.
Competency Building Module of the GCMMF is meant to infuse professional selling skills by
making the distributors and their salesmen aware of latest sales management tools and
techniques; enhance their knowledge of products; positioning and segmentation strategies for
various products. Under Amul Yatra the distributors and their salesmen are taken on a visit to
Anand. During this visit they are shown dairy plants, their upkeep, international standards of
hygiene and quality; the practices adopted for clean milk production, and above all the
cooperative philosophy. Through one to one talk with the farmers, the distributors and salesmen
realise AMUL is a large business of small farmers. The visit leaves an everlasting impression on
their minds that by selling AMUL products, they are discharging a social responsibility towards a
large number of poor farmers whose livelihood depends upon their skill and integrity. They feel
proud that they are participants in development of rural society and thus in nation building.

Earnings of GCMMF
Nurturing its primary members - the milk producers - is the first mission of the GCMMF.
Discharge of this responsibility is reflected in the manner in which the GCMMF conducts its
business and shares its earnings. The milk from the village co-operatives is purchased at an
interim price. So as to maximise the earnings of the milk producers the GCMMF changes the
product profile during the fiscal and directs its sales and marketing activities towards those
products that would bring in maximum returns. True! Every business organisation follows the
same principle. But the GCMMF follows it with the central interest of the producers. During the
fiscal, as the GCMMF finds that from its earnings it is possible to pay more to the producers for
milk, the final price is declared higher than the interim price being paid. Before the GCMMF

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closes its financial accounts the co-operatives are paid ’price difference’, the amount between the
interim price and the final price. Thus profit of the GCMMF is very low. The net profit (PADT) of
the GCMMF during 2003-04 was Rs 7.31 crore against a turnover of Rs 2,947 crore, a meagre
0.25%. Further out of the net profit of Rs 7.31 crore, Rs 4 crore was given as share dividend to the
co-operatives. To fulfil its corporate social responsibility towards its milk producers and co-
operatives the GCMMF works on razor thin profits and retention of funds.

4) CSR-oriented To Staff

The GCMMF hires and trains people to take advantage over its competitors. It has developed in-
house modules for training and competence building to improve and upgrade of their knowledge;
communication skills to understand the customer, be responsive to customer requirements, and
communicate clearly for trouble shooting of problems. They are expected to be courteous,
friendly, respectful, and considerate to the customer. To improve the credibility and
trustworthiness of the managers it is important they perform consistently and accurately every
time and at all times. The structure of salary and perquisites is altogether different. The first and
foremost the staff must get satisfaction from the job they. They are recognised for their
contribution (Climate Survey) CSR-AMUL WAY

5) GREEN GUJARAT TREE PLANTATION CAMPAIGN

Amul Coops plant more than 311.98 lakhs trees
Milk Producer members of Gujarat Dairy Cooperatives- better known as AMUL have been
celebrating the nation's Independence Day in a novel manner by planting lakhs of saplings
across Gujarat and have taken up an ambitious plan to save the environment by planting
trees, making India green and thereby reducing the effects of global warming. The milk
producers of Gujarat Dairy Cooperatives are conducting mass tree plantation drive every
year on Independence Day for last five years. In last five years (2007 to 2011) the milk
producers have planted around 311.98 lakhs trees). The most striking feature of these entire
programmes was that it has been initiated by milk producer members of the dairy
cooperatives. The unique fact about the programme was that the milk producer members
took up the oath to protect tree saplings till it survives and grows into tree.
Over the years, due to intensive agriculture and dairying various natural resources are
getting consumed at faster pace in Gujarat state of India. The state level apex body of dairy
farmers in Gujarat gave a serious thought in this direction and discovered a novel idea for
giving back to nature. The idea was "one member one tree" plantation on our 60th
Independence day - 15th August 2007.To put this idea in to the practice a design team
constituting of representatives of member unions were formed. The team accepted the idea
by heart and immediately decided to spread it among farmer members of village dairy
cooperative societies. Then the idea was communicated to farmer members and they all
welcomed it and enthusiastically agreed to implement the idea.

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For smooth implementation of the idea, the design team chalked out the road map for
various activities. Execution teams were formed at district union level to give final shape and
put the plan in action. Village level coordinators were identified and they were trained to
streamline activity of tree plantation. Various awareness materials were prepared. Through
various communication media farmer members were made aware of benefits of tree
plantation and tree plantation activity schedule
The entire plantation activity was coordinated at all the three tiers of Anand pattern - at
village, district and state level dairy cooperatives. On 15th August, 2007, after the flag
hoisting ceremony, each member took an oath to plant saplings and ensure that they grew
in to trees. Then individually they planted sapling on their own at their identified locations
like their farm, near their home, on Farm bunds, etc. They have taken necessary care to
ensure that this sapling survives and they also reported regarding the survival to village level
coordinator and district milk unions after five months. In this way, 18.9 lakh trees were
planted on 15th August 2007. This was just the beginning. Henceforth, the Village Dairy
Cooperative Societies of Gujarat as a mark of respect for our nation decided to conduct such
event on every Independence Day and accepted 15th August (Independence Day) as a
"Green Revolution Day by Afforestation to Protect Mother Earth from Pollution, Climate
change and Global Warming".
But all this required immaculate planning and execution. An action plan of tree plantation
programme was drawn up months back in advance. After the identification of the chief
coordinator for each district milk union, the organization of a task force for the programme
was put in place. Roles and responsibilities were assigned to each member and area of
operation allocated. After preparing the overall action plan, each union issued a circular to
the Dairy Cooperative Societies regarding the programme and arranged meetings with the
societies covered. At the village level, coordinators were identified in respect of the villages
to be covered and the number of saplings required. Along with logistical arrangements
direct contact was established with different agencies for receipt of saplings. Pointwise
methodology for implementation of tree plantation programme on such a mass scale is as
following.
Point wise Methodology of execution of programme is as following:
Member Unions were informed about the programme and channels of procurement of
saplings, almost six month before to scheduled date of programme.
Continuous follow up were taken from the member unions about the status of activities
planned for the programme.
A meeting on tree plantation programme was held at GCMMF Ltd., Anand almost a month
ago in which status of action plan was each Member Union was discussed at length.
Milk Unions identified the coordinator for the programme and organized a task force for the
successful implementation of the programme. The coordinator at Milk Union level chalked
out overall action plan for the programme and assigned roles and responsibilities and area
of operation to each member of task force.

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Milk Unions (MUs) issued circular to their respective VDCSs (Village Dairy Cooperative
Societies) mentioning the entire activity and procedure planned for the celebration of the
programme. In circular details for milk producer members to make necessary preparations
like deciding the place, digging the pit, taking care of saplings etc. well in advance were also
provided. The circular was placed on notice board of VDCSs.
MUs task force members contacted & communicated about the concept to VDCS and
identified the village level coordinator and assigned them roles and responsibilities.
MUs Coordinator properly explored and communicated the saplings acquiring
sources/nursery details to VDCSs. They also ensured that saplings reach the VDCSs before 3
days.
A press note was prepared by the coordinator of the programme at MU level and which
were given in the newspapers on a day before tree plantation to boost morale of producer
members and mentally prepare them for the execution of programme on next day.
At time of handing over the saplings to members from VDCS, the producer members took
oath to protect the saplings and accepted the responsibility for successfully growing the
sapling into tree.
On 15th August, after the milk collection process, at a predecided time sirens at VDCSs were
sounded or other means like beating Thali/utensil, loudspeaker etc. were used to facilitate
the gathering producer members in time at predecided place in the village for celebration of
Independence Day in VDCS premises, common plot, school etc. After flag hoisting ceremony,
the tree plantation activity was executed by the producer members.
In many villages the milk producer members planted the trees after performing the Puja
(worship) of saplings before planting them.
To add fervour and enthusiasm in the programme at many places the Chairman, Managing
Director and Board of Directors of Member Unions participated in the programme.
Next day after the programme on a post programme press note was prepared giving details
of the programme celebrations along with photographs. Similar such notes were published
in house magazines/ newsletters.
After the completion of the programme the MU's were asked to submit the report on tree
plantation activity.
MUs conducted survey after 5 months to find out the survival rate of sapling under the
programme.
First tree plantation programme (15th August, 2007) was carried out on "one member, One
tree" basis. Second tree plantation programme (15th August, 2008) in which around 52.74
lakhs tree were planted was conducted on "one member three tree" basis.
In year 2009 and in year 2010, in mass tree plantation programme around 84.24 and 83.5
lakhs tree saplings were planted respectively. The programme was conducted on "One

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member, five tree" basis. Further, this year 2011 around 72.6 lakhs trees were planted, the
programme was carried out as per the same process and procedures followed in last year.
Hence, in last five years, milk producers of GCMMF planted around 311.98 lakhs tree
saplings in 21 districts of Gujarat. By doing so, milk producers of Gujarat Dairy Cooperatives
have shown their concern, awareness and commitment for betterment of environment.
Year wise details of tree plantation and survival of tree saplings planted is as under.
Sr. No Year of tree plantation No. of trees planted (in lakhs) No. of trees
Survived (in lakhs) Survival percentage
1 2007 18.90 11 58
2 2008 52.74 26 49
3 2009 84.24 38 45
4 2010 83.5 39 47
5 2011* 72.6 34 47
Total 311.98 148.122 47
*estimated (as survey for survival percentage of the saplings planted in year 2010 is
ongoing)
According to statistics of Forest Survey of India considering on an average 30-40 cm
diameter of these trees, 106 trees would provide one hectare of green tree cover.
Considering 47% survivability of planted trees (based on post plantation survey data, around
148.12 lakhs out of 311.98 lakhs tree planted survived during last five years), when they
fully grow up, would provide additional 1,39,735 ha. of green cover which is additional 6.41
percent forest cover of Gujarat State of India.
Achievements:
This effort to provide green cover to the earth was also acknowledged when the state level
apex body of Gujarat Dairy Cooperatives - GCMMF received four successive prestigious
"SRISHTI's G-Cube Award"-2007, 2008, 2009 and 2010 for Good Green Governance in the
"Service Category".
Further, "Amul Green" movement has also been awarded by International Dairy Federation
for best environment initiative in the "sustainability category" during the 4th Global Dairy
Conference held at Salzburg Congress Center, Austria on 28th April, 2010.
It has been estimated that when one tree is cut, in monetary terms there is loss or Rs. 33
lakhs (Oxygen worth of Rs. 5.3 lakhs, Land Fertility of Rs. 6.4 lakhs, Rs. 10.5 lakh for
reduction of pollution of atmosphere and Rs. 5.3 lakh towards Flowers / Fruits and
habitation to birds - animals). But the benefits that accrue to mankind when a tree is
planted cannot be measured in money and is priceless.

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The producer members of GCMMF have really set an example for all the cooperatives and
other institutions to turn India green in the era of Global warming and environmental crisis.
When 3 million dairy farmers of Gujarat have planted more than 311.98 lakh trees in just
five years and are planning to plant more trees every year, they are doing an invaluable -
truly Amul - service to the society.
In an era of global warming, Amul is contributing its share in making Gujarat lush green. In
this way, the milk producers of Gujarat are ushering in a silent revolution of greening
Gujarat.
A devastating earthquake (Richter scale – 7.9) hit Gujarat on 26th January 2001. The
epicentre of the quake was located in Kutch district. It caused death of thousands of people,
tens of thousands were injured, hundreds of thousands were rendered homeless and
damage of billions of Rupees was done.
GCMMF formed a specific organization named "Amul Relief Trust" (ART) under the
Chairmanship of Dr. V. Kurien in 2001 with a donation of Rs. 50 Millions for reconstruction
of the school buildings damaged in the 2001 earthquake in the Kutch area.
The Trust reconstructed 6 schools damaged by the above earthquake at a cost of Rs. 41.1
millions in Kutch area. Four of these schools started re-functioning from the last two
academic sessions and the other two schools from the current session.

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References:
1. http://www.amul.com/m/about-us
2. http://www.indiacsr.in/en/?p=8497
3. http://www.amul.com/m/tree-plantation
4. http://www.amul.com/m/amul-relief-trust
5. http://www.financialexpress.com/news/corporate-social-responsibility-the-amul-
way/112172/1
6. http://www.studymode.com/essays/Csr-Activities-Of-Pepsico-India-And-
40500532.html
7. http://www.scribd.com/doc/29316112/amul-csr-ppt
8. http://seminarprojects.net/c/corporate-social-responsibility-of-amul-ppt

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