1 CSR: Exploring Perceptions of Management Students International 16 Impact of Corporate Social Journal of Responsibility on Profitability in Corporate World in India-An Buisness Empirical Study
41 Consumer Behaviour towards Green Management Products & Research
Corporate Social Responsibility Service to Humanity
ISSN : 2249-2143 Volume 10, No.1 - January - June 2020
International Journal of Business Management & Research
(A Peer-Reviewed Bi Annual Journal) ISSN: 2249-2143 Volume 10, No. 1, January-June, 2020
An Official Publication of Faculty of Business Management, Commerce & Economics Desh Bhagat University Amloh Road,Mandi Gobindgarh FategarhSahib-147301 Punjab,INDIA Year of Publication:2020 © Desh Bhagat University
Disclaimer:
The views & opinions expressed and interpretations made in the Journal are solely of respective authors and should not be attributed to Desh Bhagat University. The editor disclaim all for any responsibility injury to persons or property resulting from any ideas or product or practices referred in papers published in the Jour- nal . All effects have been made to ensure accuracy, but the editors or DBU not be held responsible for any remaining inaccuracies or omissions. INTERNATIONAL JOURNAL OF BUSINESS MANAGEMENT & RESEARCH- A Peer-Reviewed Bi-Annual Journal (ISSN: 2249-2143)
Contents Page No.
1. CSR: Exploring Perceptions of Management Students
Vikram Sharma & Dr. Shalini Gupta 1 2. Geographical Differentials and Household Characteristics among Wealth Quintile: A Cross sectional Study of District Ludhiana, Punjab
Saroj Kumar Rana, Dr. Rajni Saluja & Dr. Gurcharan Singh Gohra 7 3. Impact of Corporate Social Responsibility on Profitability in Corporate World in India- An Empirical Study
Parminder Kaur 16 4. Role of Self-Help Groups in Women Empowerment with special preference to Jammu & Kashmir.
Mohd. Ashraf Qadir & Dr. Payal Bassi 21 5. GST and its Impact on Indian Economy
Impreet Kaur 26 6. Strategies in Response to Porter’s Competitive forces in Electronic Commerce
Manu Sharma 30 7. Role of Foriegn Direct Investments (FDI) in Service Sector in India Parminder Kaur 36 8. Consumer Behaviour Towards Green Products
Neenu Sharma 41
INTERNATIONAL JOURNAL OF BUSINESS MANAGEMENT & RESEARCH- A Peer-Reviewed Bi-Annual Journal (ISSN: 2249-2143)
INTERNATIONAL JOURNAL OF BUSINESS MANAGEMENT & RESEARCH
EDITORIAL
Patrons Dr. Zora Singh Chancellor, Desh Bhagat University
Editor-in-Chief Dr. Shalini Gupta Professor University School of Management Desh Bhagat University
ASSOCIATE EDITORS
Dr. J.S. Bhatia Professor University School of Management Dr. Rajni Saluja Professor University School of Management Desh Bhagat University
ADVISORY BOARD
Prof. Azhar Kazmi Former Head, Department of Business Admin. Aligarh Muslim University and Visiting Professor of Management at King Fahad University of Petroleum and Minerals, Saudi Arabia
Dr. D.P. Goyal Director, IIM Shillong
Dr. S.S. Prasada Rao Director, Academics Gitam University Vishakapatnam
Dr. Rattan Sharma Director, Vivekananda Institute of Professional Studies Technical Campus Delhi
Dr. Jasmer Singh Saini Former HOD & Prof. of Management National Institute of technical teacher Training & Research Chandigarh
INTERNATIONAL JOURNAL OF BUSINESS MANAGEMENT & RESEARCH- A Peer-Reviewed Bi-Annual Journal (ISSN: 2249-2143)
CSR: Exploring Perceptions of Management Students *Vikram Sharma **Shalini Gupta *Assistant Professor , Bhutta College of Engineering & Technology, Ludhiana **Professor, Desh Bhagat University, Mandi Gobindgarh, Punjab
Abstract The agenda of development by Governments worldwide needed to be supported by business organizations that have the capacity to make considerable social impact. The research paper studies Corporate Social Responsibility (CSR) as an important field of concern and a prospective contributor to the development. The latest amendment of CSR mandate in the New Companies Act, 2013 has actually posed requirement for creating awareness on CSR mandate to implement it in an effective manner. The research paper studies stream differences in perceived role of ethics and social responsibility of business management students. The study was conducted on a sample of 300 management students in two groups of 150 each of marketing & finance streams in MBA 2nd year selected by random stratified sampling from selected colleges of Punjab. The results exhibits that there is no significant difference in perceived role of ethics and social responsibility of marketing and finance streams of business management students. The study emphasizes the need of building positive attitudes and perception regarding CSR in future leaders of social responsibility practices.
Key Words: Corporate Social Responsibility (CSR), New Companies Act, 2013, Perception.
Introduction really function. These features must aim The developmental concern of governments at sustainable growth and must also result worldwide concentrates at attaining in societal welfare as well as think about sustainable development goals established the expectations of employees of business. by the United Nations. India too is making CSR is likewise used interchangeably with every attempt on the path of accomplishing phrases like Corporate Accountability, developmental objectives and substantial Enterprise that is Responsible, Business economic developments have been witnessed. Ethics, Corporate Citizenship, Sustainability, The most crucial contributor to this and Corporate Social Opportunity along improvement is the corporate industry which with Corporate Responsibility. What’s has noticed huge development recently and more, it refers to the techniques employed has the capability to make a significant social by businesses to accomplish tasks in an influence and development. Uccello (2009) honest and in such a way that’s helpful observed a change in the business sector as to society in development. CSR has got a a result of globalization and liberalization. significant interest and has additionally Businesses are an area to offer work as well undergone remarkable changes within as positively impact the societal ailments of the last couple of years as many initiatives society anywhere. As business is actually have been considered by governments dependent on society for its business worldwide. India additionally launched a transactions, it should split its share and leap in this particular area by creating CSR earnings with society and should know and expenditure compulsory as described in the accept the responsibility towards society i.e. section 135 of New Companies Act, 2013. social responsibility. Social Responsibility is Evolution of Corporate Social the duty of companies to show ethical and Responsibility (CSR) transparent behaviour concerning effects of The CSR movement started in the 1920’s its actions of its on society as well as the earth. when big corporations of oil, electricity, The corporate sector necessitates contributing telecommunication & car sector viewed CSR to the government’s endeavour for social as a part of management studies. Bowen and economic growth and fulfilling the (1953) referred CSR to the obligations of obligations of the organizations to the society businessmen to get those policies, to create i.e. Corporate Social Responsibility (CSR). those choices, or even to go by those lines CSR refers to obligations which organizations of motion that are appealing in phrases of owe towards the society in which they values & goals of society.
IJBMR, 10(1), January - June, 2020 Page 1
INTERNATIONAL JOURNAL OF BUSINESS MANAGEMENT & RESEARCH- A Peer-Reviewed Bi-Annual Journal (ISSN: 2249-2143)
Friedman minimalist’ view of corporate (internally and externally)that was in harmony responsibility (Lucas, Lafferty and Wollin, with Stakeholder approach by Freeman that 2001), a business centric perspective argued that interests of all the stakeholders asserted that there’s one and just one social - Financers, customers, suppliers, employees responsibility of company i.e to utilize its and communities must be kept in harmony. resources and take part in activities meant Philip, Kotler and Nancy Lee (2005) to boost its earnings so long as it remains described CSR as the obligation to improve in the rules and engages in free and open and develop community well being by means competition, with no fraud or deception. of discretionary business practices as well Johns Johnson (1971) stressed the view of as contribution of company means. IN 2003, utility optimization that is a lexicographic Commission of the European Communities view, along with a standard perspective described CSR as the idea that an enterprise which parallels Bowen’s (1953) definition. who is responsible for the impact of its The Committee for Economic Development in effect on all pertinent stakeholders. It’s the 1971 presented a 3 concentric circle method continuing commitment of corporates to to depict CSR. The circles represent purely behave responsibly and fairly and also add to honest, purely economic, and solely legal economic development while simultaneously actions of the firm (Carroll and Schwartz, enhancing the quality of life of the work 2003). force as well as their families and of the Carroll (1979) described CSR by specifying local community as well as society at large 4 domains of a company (economic, legal, and in 2011 redefined CSR as the duty honest, and discretionary), showing the duties of the enterprises for their impacts on which society expects businesses to think. society. The International Organization for Standardization Report (ISO, 2010) Carroll (1991) regards a CSR organization or considers Social Responsibility as the maybe CSR to be genuine in case it strives obligation of a company for the effect of its to create an income, obeys the law, and is decisions and actions on society and also the actually honest along with a corporate citizen. planet. The businesses should show ethical Freeman’s work on the emerging Stakeholder and transparent behaviour and make sure Theory was a crucial milestone of the evolution they add to sustainable growth for health of idea of CSR. Freeman emphasized that and also the welfare of society, take into accomplishing shareholder needs is just consideration the stakeholders expectations, one of the components in a value adding comply with international law and norms of course of action and then identified a range behaviour and also have integrated CSR to of stakeholders (including shareholders) the organization as well as practices CSR in applicable to the firm’s operations. most of their procedures. Corporate Social Responsibility in India Freeman’s 1984 paper goes on to be CSR isn’t a new term for India and many recognized as a seminal paper on stakeholder businesses in India have been engaging concept like a dominant paradigm of in charity, philanthropic activities as well CSR (Siegel and McWilliams, 2001). as social development pursuits. Inspite In the 1990’s, sustainability rose as a budding of philanthropic activities and numerous theme and establishment of worldwide efforts, social responsibility in India didn’t companies’ management positions exclusively have any organized and formal design. A new devoted to management. In 1997, Elkington’s Partnership for inclusive growth is required Triple Bottom line which challenged which could be the 10 Point Social Charter businesses to keep people, planet and profit and we require regard for the employees i.e social, economic and environmental facets and invest in their welfare (Singh, 2007). into balance received acceptance. The idea In 2009, the Ministry of Corporate Affairs of CSR shifted as a result of the traditional released Voluntary Guidelines on CSR as the shareholder perspective (only objective being initial step towards mainstreaming socially earnings maximization) to stakeholder view responsible company. A significant milestone
IJBMR, 10(1), January - June, 2020 Page 2
INTERNATIONAL JOURNAL OF BUSINESS MANAGEMENT & RESEARCH- A Peer-Reviewed Bi-Annual Journal (ISSN: 2249-2143) in this particular course was making CSR ethical issue is actually percieved in a certain invest necessary reported in section 135 situation or perhaps not. Singhapakdi et al. in the new Companies Act 2013 and India (2001) recognize that administrators have is actually the very first state to make CSR got to initially perceive social responsibility legally necessary. The Act directs businesses and ethics to be essential to organizational (for a specified turnover /net well worth strength before their actions start to be / profit) to invest two percent of their net much more honest and mirror greater social income of previous three financial years on responsibility. Hence, perceived value of social CSR pursuits as well as report reasons in responsibility & ethics for organizational case of non compliance, therefore attaching success might be a crucial determinant of a lot more value to the area in the terms of legitimate business conduct. creating consciousness regarding CSR as well Singhapakdi et al. (1996) created a scale for as the implementation of its (The Companies measuring perceptions of the importance of Act, 2013. The Ministry of Corporate Affairs ethics and social responsibility (PRESOR) (MCA) issued CSR Rules, 2014, to carry out to organizational success. Three factors of this legislative mandate that came into effect PRESOR representing perception – income on April one, 2014 (Ministry of Corporate & social responsibility, short-term gains Affairs). and long-term gains were included in their Sushmita (2013) in’ Corporate Social initial work. Although opening analysis of Responsibility: Current Scenario’ concluded research studies on perception supported that the Section 135 of new Companies Act, the existence of these factors and further 2013 is a great effort and it would go a long additional work recommended modifications way in fortifying the social initiatives taken and acknowledged only two factors i.e. by the businesses. importance of ethics and social responsibility Hence the CSR mandate has immense and subordination of ethics and social possibilities for contribution to development responsibility and with the results it was and growth but practical and successful also merging along two themes—stakeholder implementation of the Act relies on its and shareholder views. The shareholder view perception by business as an opportunity to reveals a relatively narrow and limited view of attain long lasting results or even just like organizational obligations which emphasize an activity for authorized reasons. Keeping in the significance of business profitability view, the latest advancements in the area of (taking care of interests of the stakeholders CSR, perception of students regarding CSR while keeping out others) and commitment holds a considerable place in the academic only towards stakeholders. Business leaders world as it is going to have an effect on the with stakeholder-orientation, assign more implementation of CSR importance to the interests of business Perceived Role of Ethics and Social stakeholders rather than highlighting only Responsibility the interests or benefit of shareholders. Those who have a stakeholder view emphasize The leveltowhicha person attaches importance that the business owes accountability to to values as well as business obligation might stakeholders and should act ethically and be unique and of the countless elements also in a socially responsible manner. Thus, having considerable effect on tendency of attitudes of managers regarding the value company supervisors to be engaged in ethical and importance of corporate ethics and social and responsible conduct, one of probably the responsibility facilitate a lens to see and most significant will be the benefits that they evaluate business decisions. A manager’s connect to responsible behaviour as well as its course of action in a situation with ethical role of success and survival of the company. dilemma will be based on perception of the Singhapakdi et al. (1996) state that perceived likelihood that the actions will produce a importance of societal responsibility as desired outcome. Hence, with regard to well as ethics to organizational strength is implementing and practising CSR, perception actually apt to be a major determinant if an holds a very important place.
IJBMR, 10(1), January - June, 2020 Page 3
INTERNATIONAL JOURNAL OF BUSINESS MANAGEMENT & RESEARCH- A Peer-Reviewed Bi-Annual Jour- nal (ISSN: 2249-2143)
Significance and Emergence of the Study prepare future business leaders, especially Perception towards corporate social business facilities to play a proactive role in responsibility is actually a crucial component training the future and present generations that determines the effective implementation to take up CSR duties as well as bridge the of CSR and it’s the need of the hour to gap between business and modern society. understand factors which figure out how as The idea certainly requires understanding well as to what extent a person perceives the as well as interest regarding CSR has to be role as well as value of social responsibility inculcated. Therefore, the investigator felt as important. The evaluation of literature that there’s a need to research perception of associated with perceived importance of business students regarding CSR. social responsibility and company ethics Objective of the Study exhibits that previous investigations on the To study stream wise differences in perceived subject studies PRESOR attitudes of various role of ethics and social responsibility of PG populations as staff and supervisors (Dawson, students of management. 1997; Kujala, 2010), and business pupils Hypothesis of the Study (Singhapakdi,1995 and Kraft ; Simmons There is no significant difference in perceived et al., 2009). Researches in addition made role of ethics and social responsibility of comparisons of perceptions of pupils and marketing and finance streams of PG students supervisors (Smith and Cole, 1996); and also of management. explored cross cultural disparities in PRESOR Methods & Procedures responses (Singhapakdi et al., 1994 & 2001; The present study was a descriptive survey Shafer et al., 2006). Researches also studied and was conducted on PG students of religiosity as well as ethical perspectives management from selected colleges of Punjab. as determinants of perception (Quazi, PG students of management studying in 2003; Simmons and Shaffer, 2008).Some MBA 2nd year were selected for the present studies determined gender as a tremendous research as the second year students have determinant of perception towards CSR undergone industrial training after completing (Ameen et al., 1996; Gill, 2010) whereas others 1st year of MBA course. PRESOR Scale by found no huge effect of gender on perception Singhapakdi, Vitell, Kraft and Rallapalli (Gholipur et al., 2012). The previous work (1996) was utilized to determine Perceived doesn’t indicate some clear path concerning role of ethics and Social Responsibility. Mean, perception regarding CSR hence suggesting median, standard deviation, skewness as well scope for more research on perception. as kurtosis were used on the scores of MBA New Companies Act, 2013 has produced students for the variable of perceived role of a room for CSR in India by laying down ethics and social responsibility to determine legislative provisions for guaranteeing the dynamics of the score distribution. t- CSR invest by organizations and there’s Test was put on to evaluate the significance astounding potential for betterment and of difference of perception with respect to growth of the society through business stream or specialization. contribution but implementation of the Analysis and Interpretation mandate in the sense that is real will be Tables showing mean difference between achievable only when pro CSR mindsets are finance group and marketing group of actually created and CSR invest is performed PG students of management for variable truly and not only to fight compliance of perceived role of ethics and social problems. Kumar (2014) discovered that responsibility have been presented in the there’s a requirement to create understanding table below. about CSR amongst the general public to The results presented in table 1show that t- ensure that CSR initiatives could be done value for difference in mean scores of finance more efficiently. The requirement to make group and marketing group of PG students of certain the implementation of CSR has put management for variable of perceived role of additional duties on the institutions which ethics and social responsibility was 4.725
IJBMR, 10(1), January - June, 2020 Page 4
INTERNATIONAL JOURNAL OF BUSINESS MANAGEMENT & RESEARCH- A Peer-Reviewed Bi-Annual Journal (ISSN: 2249-2143)
of management for variable of perceived role of ethics and social responsibility are 18.253 and 13.813. Thus higher mean scores of finance group of PG students of management for variable of perceived role of ethics and social responsibility led to the conclusion that finance group of PG students of management has significantly higher perception than marketing group of PG students of Management towards CSR. Therefore, hypothesis, “There is no significant difference in perceived role of ethics and social responsibility of marketing and finance streams of PG students of management” has been rejected. Conclusion Results show that marketing group of PG students has significant lower perception towards role of ethics and social responsibility than finance group of PG students of Figure 1: Displaying Mean Difference management. So it can be concluded that between Scores of Finance Group and finance group of PG students of management Marketing Group of PG Students of has higher perception towards role of ethics management for Variable of Perceived and social responsibility suggests that Role of Ethics and Social Responsibility. students of finance stream are more aware which is significant at 0.01 level. This shows of the concept and importance of corporate that finance group and marketing group of PG social responsibility. This may be attributed students of management differ significantly to the fact that they deal with financial and on the variable of perceived role of ethics and social audit and are trained to deal and social responsibility. comply with the norms. Figure 1 depicts mean scores of finance Implications group and marketing group of PG students The study highlights the demand for Table 1: Mean Difference between Scores of Finance Group and Marketing Group of PG Students of Management for Variable of Perceived Role of Ethics and Social Responsibility.
Group N Mean SD Mean Dif- Standard T Value Remarks ference Error Dif- ference Finance 150 18.253 8.9968 4.4400 .9396 4.725 0.000** Marketing 150 13.813 7.1760 ** Significant at 0.01 level. emphasizing the idea of CSR in academics in real manner as well as spirit to tap the as well as the company to generate enormous potential of the social mandate to understanding about the CSR mandate. The ensure that it might benefit the society. results of the study likewise highlight the References demand for building pro CSR mind sets in Ameen, E., Guffey, D., & the future beholders of social responsibility McMillan, J. (1996).Gender differences in habits for implementation of CSR mandate determining the ethical sensitivity of
IJBMR, 10(1), January - June, 2020 Page 5
INTERNATIONAL JOURNAL OF BUSINESS MANAGEMENT & RESEARCH- A Peer-Reviewed Bi-Annual Jour- nal (ISSN: 2249-2143) future accounting professionals. Journal of Technology, 3( 5). Business Ethics, 15(5), 591-597. McWilliams, A.,& Siegel, D. (2001). Bowen, H. R. (1953). Social responsibilities “Corporate Social Responsibility: A Theory of the Firm Perspective.” Academy of of the businessman, New York: Harper Management Review, 26(1), 117-127. & Row. JOHNSON, B. (1971). Household Schwartz, M. S., & Carroll, A. B. (2003). Behaviour. Penguin. Corporate social responsibility: A three- Caroll, A.B. (1979). A three dimensional domain approach. Business Ethics model of corporate social performance, Quarterly, 13(4), 503–530. Statistics Academy of managing Review, Singhapakdi, A., Vitell, S.J., Rallapalli, K.C. ,& Kenneth, L.K. (1996). “The perceived role 4(4), 497-505. of ethics and social responsibility: A scale Caroll, A.B. (1991). The pyramid of development.” Journal of Business Ethics, corporate social responsibility: Toward the 15(11), 1131-1140. management of organisational stakeholders, Singhapakdi, A., Vitell, S. J., &Leelakulthanit, Business Horizons, 34(4) 39-48. O. (1994) . A cross cultural Study of Moral Cole, B.C. & Smith, D.L (1996). Perceptions Philosophies, Ethical Perceptions and of business ethics: Students vs. business Judgements: A Comparison of American peo ple. Journal of Business Ethics, 15 (8), and Thai Marketers .International Marketing 889–896. Review, 11 (6), 65- 78. Dawson, L. M. (1997). Ethical differences Singhapakdi, A., Karande, K., Rao, C.P., between men and women in the sales &Vitell, S.J. (2001). “How important are ethics profession. Journal of Business Ethics, 16(1), and social responsibility? A multinational 1143-1152. study of marketing professionals.” European Elkington, J. (1997). Cannibals with Forks: Journal of Marketing, 35, 133-152. The Triple Bottom Line of 21st Century Simmons, R. S. , Shafer, W. E. , & Snell Business, Capstone Oxford, 1997, 402 pp. , R. S. (2009). Effects of a business ethics ISBN 1-900961-27-X. elective on hongkong Freeman, R. E. (1994). The politics of undergraduates’ attitudes toward corporate stakeholders’ theory: Some future directions. ethics and social responsibility. R e s e a r c h Business Ethics Quarterly, 4(4), 409-421. Gate, DOI: 10.1177/0007650309350282. Gill , S. (2010). Is gender inclusivity an Shafer, W.E., Fukukawa, & Lee, G.M. (2007). answer to ethical issues in business? An Values and the perceived importance of ethics Indian stance. Gender in Management: An and social responsibility: The U.S. versus International Journal, 25 (1), 37-63. China. Allemagne ; Springer, Heidelberg, Gholipur, T.H., Nayeri, M.D., & Mehdi, 70, 3, 265-284. S.M.M. (2012). Investigation of attitudes Shafer, W. E., & Simmons, R. S. (2008). about corporate social responsibility: Social responsibility, machiavellianism and Business students in Iran. African Journal of tax avoidance: A study of Hong Kong tax Business Management, 6 professionals. Accounting, Auditing and (14), 5105-5113. Accountability Journal, 21, 695-720. Kotler,P.,& Lee, N.(2005). “Corporate Social Sushmita C.A. (2013) Corporate Social Responsibility: Doing the Most Good for Your Responsibility : Current Scenario. Research Company and Your Cause.” John Wiley & Journal of Management Sciences 2(12),12- Sons, Inc. 14. Kraft, K.L. &Singhapakdi , A. (1995). The Uccello, C.(2009). Social Interest and Social relative importance of social responsibility Responsibility in Contemporary Corporate in determining organisational effectiveness: Environments, Journal of Individual student responses. Journal of Business Psychology, 65(4), 412-419. Ethics, 14(4), 315-326. www. mca. gov.in/ministry/pdf/The_ Kujala, J. (2010), Corporate responsibility Companies_Bill_2012.pdf perceptions in change: Finnish managers’ www.mca.gov.in/Ministry/.../National_ views on stakeholder issues from Voluntary_Guidelines_2011_12jul2011.pdf 1994 to 2004. Business Ethics: A European https://csrngo.files.wordpress. Review,19,14–34. com/2012/09/pms-10-point-charter-for- Kumar N. (2014). Corporate social companies.pdf responsibility: analysis of impact and • ht t ps : / / w w w . i s o. or g / i so /i s o - challenges in India, Abhinav gri-26000_2014-01-28.pdf International Monthly Refereed Journal of h ttp s:/ / www.iso .o rg/ iso -2 6 0 0 0 -so cia l- Research in Management and responsibility.html
IJBMR, 10(1), January - June, 2020 Page 6
INTERNATIONAL JOURNAL OF BUSINESS MANAGEMENT & RESEARCH- A Peer-Reviewed Bi-Annual Journal (ISSN: 2249-2143) Geographical Differentials and Household Characteristics among Wealth Quintile: A Cross Sectional Study of District Ludhiana, Punjab *Saroj Kumar Rana **Rajni Saluja *** Gurcharan Singh Ghotra
* Research Analyst, School of Health Sciences, PGIMER, Chandigarh ** Professor, Desh Bhagat University Mandi Gobindgarh Abstract Household’s basic amenities like drinking water, sanitation, electricity, housing, drainage etc are the important indicator of quality of life. Housing is the one of the important basic needs of individual after food and clothing. In current era, every individual wants basic amenities such as water, cooking and sanitation facilities.Objective is to study the household’s characteristics among socio-economic status in rural and urban areas of district Ludhiana of Punjab, India. The study used the multistage sampling procedures for data collection. District is selected using purposively in first stage. Blocks selected using cluster sampling in second stage, in third stage villages were selected stratified random sampling and fourth stage, households selected using random sampling. Total 400 households covered for the data collection rural and urban areas of Ludhiana district. Wealth quintile is generated by using Principal component statistical method for different assets of households. Monthly per capita expenditure for rural isRs.1793 and urban is Rs.1991. The study concluded that bottom quintiles such as poorest and poor shows low access to basic amenities like sanitation, cooking, water and housing. It was further seen that economic status of households is strongly related to basic amenities. Key words: Basic amenities, Socio-Economic Status, Households Characteristics, Toilet Facility, Source of Cooking, Wealth Quintile Introduction have toilet facility . Government has taken Household’s amenities show “quality of house”. various steps towards the improvement in Household’s assets and amenities present housing condition and basic amenities in the quality of life. The word “basic amenities” India and is successfully working from last refers to electricity, drinking water, sanitation few years, but still a some households lacking Household’s basic amenities like drinking basic amenities especially in rural areas water, sanitation, electricity, housing, of India. Studies show that the households drainage etc are the important indicators belongs to ST’s and SC’s and bottom quintile of quality of life. Housing is one of the according to consumption shows lack of important basic needs of an amenities . individual after food and clothing Data and Methodology Safe drinking water and sanitation are not Objective: To study the household’s only important in life but also an important characteristics among socio-economic element to health of individuals. Housing status in rural and urban areas of condition and access to basic households district Ludhiana of Punjab, India. amenities are related to the health condition Study Period: Cross sectional study was of individuals. Poor conditions of housing conducted from June to December 2017. affect the current and future health status of Area of study individuals. Both developed and developing Punjab: Punjab is the northern state of India countries have inequality in housing. Many of surrounded by the four states viz Jammu & the developed countries highlighted inequality Kashmir, Himachal Pradesh, Haryana and according to racial and ethnic difference in Rajasthan. It is bounded form North side housing. On the other hand, in developing by Jammu and Kashmir, Himachal Pradesh countries, better access to housing relates to from North-East side, Haryana form the their socio-economic and social status . Just South, Rajasthan from the South-West side. like the developing countries, India also reports Punjab came into existence on November inequality in basic amenities and housing 1, 1966 and the city of “Chandigarh” is the According to Census 2011, 13 percent joint Capital of Punjab and Haryana. The households do not have electricity, 16 percent word “Punjab” is combination of two Persian do not have safe water and17 percent do not words Panj (meaning five) and ab (meaning
IJBMR, 10(1), January - June, 2020 Page 7
INTERNATIONAL JOURNAL OF BUSINESS MANAGEMENT & RESEARCH- A Peer-Reviewed Bi-Annual Journal (ISSN: 2249-2143)
water). This signifies the land of five rivers Statistical Tool: Statistical software SPSS namely Beas, Chenab, Jhelum, Ravi and version 21.0 (SPSS Inc. SPSS Statistics for Staluj respectively. The total area of Punjab Windows, Version 21.0. Chicago) is used for is 50,362 km (19,445 square miles) with the analysis of data. Wealth quintile is generated cultivable area and its average elevation is by Principal Component Analysis (PCA)using 300 Meters (approx. 980 ft) above the sea level different households assets. with range from 100 Meters (590 ft) in the Results & Discussions South West to more than 500 Meters (1600 ft) Majority of households belongs to Sikh (63 towards the North East border. Punjab has 22 percent), Hindu (36.5 percent) and very districts which are geographically classified few to other (0.5 percent) in rural area, in to Majha, Malwa, Doaba and Poadh regions where as majority of households belongs to Ludhiana is a Punjab’s big city with area of Hindu (63 percent), Sikh (25 percent) and 310 square km. According to census 2011, other (12 percent) in urban areas. Based on Ludhiana has a population of 34,87,882, wealth quintile-wise results, in rural areas, Literacy rate is 73.5 percent for total majority of Sikhs belong to bottom quintile, population, of which male Literacy is 76.5 that is poorest (73.9 percent), poor (60.8 percent and female literacy is 69.4 percent. percent), Medium (72.3 percent), Rich (48.9 The sex ratio is 973 female to every1000 percent) and Richest (65.6 percent), where male. Total SC population is 9,23,358 and as in case of Hindu, majority of households the total number of households is 716,826 belongs to upper quintile that is Rich (51.1 percent) and Richest (34.4 percent) and very Data Collection: Four hundred households few Muslim/Christian/Other households were taken for data collection. A well- belong to bottom quintile that is poor (2.0 structured questionnaire used for collecting percent). In urban areas, wealth quintile- the information. Data collection was related wise results show that majority of Hindus to characteristics like religion, caste, belong to bottom quintile, that is poorest education & occupation of the head of (68.4 percent), poor (62.1 percent), Medium household, toilet facility, source of drinking (60.6 percent), Rich (66.7 percent) and water , source of light, type of house, Richest (56.3 percent), whereas in case of source of cooking and different assets etc. Sikhs, majority of households belongs to Sampling: The study adopted four multistage upper quintile that is Rich (43.8 percent) and - sampling procedures for the selection of Richest (43.8 percent) and whereas, Muslim/ households. In the First stage, districts Christian/Other households belongs bottom were purposively selected for this study. The quintile that is poor (2.0 percent) and poor selection of the districts was done on the (20.7 percent).(Table1). basis of the population. In the second stage, Majority of 58.8 percent households have blocks were selected by using cluster analysis. income between Rs.10001-15000, 10.2 Blocks were selected on the basis of higher percent have income between Rs.15001- population proportion to total population of 20000, 26.2 percent households have the district. Thus, two block were selected for income less than Rs.10000 and very few this study, one for urban and one for the rural. 4.8 percent households have income more In the Third Stage, villages were selected. than Rs.20000 respectively. Majority of rural Two villages from rural and two from urban households have average income between areas were selected. Thus, in all 4 villages were Rs.10001-15000 (58.5 percent), less than selected from the above mentioned district Rs.10000 (35.5 percent), average income using stratified sampling technique. In the between Rs.15001-20000 (5.5 percent) and Fourth stage, the selection of households was more than Rs.20000 (0.5 percent). Based on selected on randomly by using random number wealth quintile-wise results, in rural areas, generation. Same proportion of households households belong to upper quintile that is will be selected for data collection from four rich (72.3 percent) and richest (68.8 percent) villages from urban as well as from rural block. have more income, whereas lower quintile have
IJBMR, 10(1), January - June, 2020 Page 8
INTERNATIONAL JOURNAL OF BUSINESS MANAGEMENT & RESEARCH- A Peer-Reviewed Bi-Annual Journal (ISSN: 2249-2143)
Table 1: Religion among Wealth Quintile in Rural and Urban Areas
Area Religion/ Poorest Poor Medium Rich Richest Overall Wealth Quintile Hindu 26.1 37.3 27.7 51.1 34.4 36.5 Sikh 73.9 60.8 72.3 48.9 65.6 63 Rural Muslim/ Christian/ 0.0 2.0 0.0 0.0 0.0 0.5 Other Total 100.0 100.0 100.0 100.0 100.0 100 Hindu 68.4 62.1 60.6 66.7 56.3 63.0 Sikh 3.5 17.2 36.4 30.3 43.8 25.0 Urban Muslim/ Christian/ 28.1 20.7 3.0 3.0 0.0 12.0 Other Total 100.0 100.0 100.0 100.0 100.0 100 Hindu 56.3 46.3 41.3 57.5 47.5 49.75 Sikh 23.8 45.0 57.5 41.3 52.5 44 Total Muslim/ Christian/ 20.0 8.8 1.3 1.3 0.0 6.25 Other Total 100.0 100.0 100.0 100.0 100.0 100 Source :- Primary Survey, 2018 Table 2: Social Group among Wealth Quintile in Rural and Urban Areas
Social Poorest Poor Medium Rich Richest Overall Area Group/ Wealth Quintile SC 34.8 35.3 14.9 8.5 37.5 24.5 OBC 39.1 17.6 19.1 19.1 21.9 21.5 Rural General 26.1 47.1 66.0 72.3 40.6 54 Total 100.0 100.0 100.0 100.0 100.0 100 SC 21.1 10.3 18.2 18.2 50.0 25.5 OBC 47.4 51.7 39.4 36.4 16.7 37.5 Urban General 31.6 37.9 42.4 45.5 33.3 37 Total 100.0 100.0 100.0 100.0 100.0 100 Source :- Primary Survey, 2018 poor (52.9 percent), poorest (34.8 percent) (20.8 percent), whereas very few households and medium (55.3 percent) respectively. have average income greater than Rs.20,000, In urban area, households having average upper quintiles that is rich (15.2 percent) income between Rs.10001-15000, and richest (10.4 percent) shows more households belong to lower quintile poorest proportion of average income.( see Table 3) (61.4percent), poor (69 percent) shows Majority of households have nuclear (81.5 more proportion than other quintiles, where percent) followed by joint (18.5 percent) households with average income Rs.15001- family system. In rural areas, nuclear family 20000 shows more proportion in upper (79.5 percent) dominated as compared to quintile that is rich (18.2 percent)and richest joint (20.5 percent), where as in urban areas,
IJBMR, 10(1), January - June, 2020 Page 9
INTERNATIONAL JOURNAL OF BUSINESS MANAGEMENT & RESEARCH- A Peer-Reviewed Bi-Annual Journal (ISSN: 2249-2143) Table3: Income Level among Wealth Quintile in Rural and Urban areas
Area Income Poorest Poor Medium Rich Richest Overall level/ Wealth Quintile
IJBMR, 10(1), January - June, 2020 Page 10
INTERNATIONAL JOURNAL OF BUSINESS MANAGEMENT & RESEARCH- A Peer-Reviewed Bi-Annual Journal (ISSN: 2249-2143)
Table 4: Family Type among Wealth Quintile in Rural and Urban Areas Area Family Poorest Poor Medium Rich Richest Overall type/Quin- tile Nuclear 65.2 90.2 76.6 78.7 78.1 79.5 Rural Joint 34.8 9.8 23.4 21.3 21.9 20.5 Total 100.0 100.0 100.0 100.0 100.0 100 Nuclear 96.5 86.2 75.8 69.7 81.3 83.5 Urban Joint 3.5 13.8 24.2 30.3 18.8 16.5 Total 100.0 100.0 100.0 100.0 100.0 100 Nuclear 87.5 88.8 76.3 75.0 80.0 81.5 Total Joint 12.5 11.3 23.8 25.0 20.0 18.5 Total 100.0 100.0 100.0 100.0 100.0 100 Source :- Primary Survey, 2018 Table 5: Type of Latrine among Wealth Quintile in Rural and Urban Areas
Area Poorest Poor Medium Rich Richest Overall Flush 34.8 51.0 74.5 74.5 46.9 59.5 Pit Latrine 30.4 15.7 8.5 6.4 15.6 13.5 Rural Open Pit 8.7 27.5 6.4 10.6 31.3 17 Other 26.1 5.9 10.6 8.5 6.3 10 Total 100.0 100.0 100.0 100.0 100.0 100 Flush 1.8 6.9 39.4 48.5 25.0 22 Pit Latrine 87.7 75.9 45.5 39.4 62.5 65 Urban Open Pit 10.5 13.8 12.1 12.1 4.2 10 Other 0.0 3.4 3.0 0.0 8.3 3 Total 100.0 100.0 100.0 100.0 100.0 100 Flush 11.3 35.0 60.0 63.8 33.8 40.8 Pit Latrine 71.3 37.5 23.8 20.0 43.8 39.2 Total Open Pit 10.0 22.5 8.8 11.3 15.0 13.5 Other 7.5 5.0 7.5 5.0 7.5 6.5 Total 100.0 100.0 100.0 100.0 100.0 100 Source :- Primary Survey, 2018 and richest (15.6 percent) show less use of Majority of households used LPG (88.7 pit latrine. Further, use of open pit is found percent) source of cooking followed by Fire more in top quintile i.e richest (31.6 percent), wood/ crop residue (8 percent) and Cow whereas other type of latrine is found more dung/coal/Kerosene (3.3 percent). In rural in use in poorest quintile (26.1 percent). In areas, majority of households used LPG (84 urban areas, use of flush latrine is found percent) source of cooking followed by Fire more in top quintile that is rich (48.5 percent) wood/ crop residue (10.5 percent) and Cow and richest (25 percent), whereas use of pit dung/coal/Kerosene (5.5 percent), whereas latrine is found more in bottom quintile like urban households used LPG ( 93.5 percent) poorest (87.7 percent) and poor (75.9 percent). source of cooking followed by Fire wood/ The use of Open pit is found more in bottom crop residue (5.5 percent) and Cow dung/ quintile that is for poorest (10.5 percent) and coal/Kerosene (1 percent). Quintile-wise poor (13.8 percent) and top quintile that is rich result shows that in rural areas, majority of ( 12.1 percent) use of open pit .(seeTable 5) households who belong to top quintile shows
IJBMR, 10(1), January - June, 2020 Page 11
INTERNATIONAL JOURNAL OF BUSINESS MANAGEMENT & RESEARCH- A Peer-Reviewed Bi-Annual Journal (ISSN: 2249-2143)
Table 6: Cooking Source among Wealth Quintile in Rural and Urban Areas
Area Cooking Poorest Poor Medium Rich Richest All Source/ Wealth Quintile LPG 60.9 86.3 93.6 89.4 75.0 84 Fire wood/ 26.1 11.8 4.3 4.3 15.6 10.5 crop resi-
due Rural Cow dung/ 13.0 2.0 2.1 6.4 9.4 5.5 coal/Kero- sene Total 100.0 100.0 100.0 100.0 100.0 100 LPG 89.5 93.1 97.0 97.0 93.8 93.5 Fire wood/ 10.5 3.4 3.0 0.0 6.3 5.5 crop resi-
due Urban Cow dung/ 0.0 3.5 0.0 3.0 0.0 1 coal/Kero- sene Total 100.0 100.0 100.0 100.0 100.0 100 LPG 81.3 88.8 95.0 92.5 86.3 88.7 Fire wood/ 15.0 8.8 3.8 2.5 10.0 8.0 crop resi-
due Total Cow dung/ 3.8 2.5 1.3 5.0 3.8 3.3 coal/Kero- sene Total 100.0 100.0 100.0 100.0 100.0 100 Source :- Primary Survey, 2018 more proportion use of LPG as rich (89.4 (19.5 percent) and very few households have percent) and richest (75 percent) respectively. 7.5 percent Katcha house, whereas in urban Fire wood/ crop residue are found more in households have pucca houses (79 percent), bottom quintile poorest (26.1 percent) and semi-pucca (20.5 percent) and very few poor (11.8 percent) whereas cow dung/coal is households have 0.5 percent Katcha houses. found more in poorest (13 percent). In urban Quintile wise in rural areas, top quintile areas, majority of households who belong to have more pucca house among top quintile top quintile shows more proportion use of LPG that is for rich (83 percent) and richest (68.8 as rich (97 percent) and richest (93.5 percent) percent), whereas bottom quintile like poorest respectively. Fire wood/ crop residue is found (30.4 percent ) and poor (72.5percent), semi- more in bottom quintile poorest (10.5 percent) pucaa houses are found more in bottom and poor (3.4 percent) where as cow dung/coal quintile like poorest (43.5 percent) and poor found more in poor (3.5 percent).(seeTable 6) (23.5 percent). Katcha houses found more Majority of households have pucca houses on bottom quintile like poor (26.1 percent), followed by semi-pucca (20 percent) and where as urban areas, top quintile have more very few households have 4 percent Katcha pucca houses among top quintile that is for house. In rural areas, majority of households rich (90.9 percent) and richest (85.4 percent), have pucca houses (73 percent), semi-pucca whereas bottom quintile like poorest (63.2
IJBMR, 10(1), January - June, 2020 Page 12
INTERNATIONAL JOURNAL OF BUSINESS MANAGEMENT & RESEARCH- A Peer-Reviewed Bi-Annual Journal (ISSN: 2249-2143)
Table 7: House Type among Wealth Quintile in Rural and Urban Areas
Poorest Poor Medium Rich Richest Overall
Katcha 26.1 3.9 6.4 4.3 6.3 7.5 Rural Semi-Pucca 43.5 23.5 6.4 12.8 25.0 19.5 Pucca 30.4 72.5 87.2 83.0 68.8 73 Total 100.0 100.0 100.0 100.0 100.0 100
Katcha 1.8 0.0 0.0 0.0 0.0 0.5 Urban Semi-Pucca 35.1 27.6 9.1 9.1 14.6 20.5 Pucca 63.2 72.4 90.9 90.9 85.4 79 Total 100.0 100.0 100.0 100.0 100.0 100
Katcha 8.8 2.5 3.8 2.5 2.5 4 Total Semi-Pucca 37.5 25.0 7.5 11.3 18.8 20 Pucca 53.8 72.5 88.8 86.3 78.8 76 Total 100.0 100.0 100.0 100.0 100.0 100 percent) and poor (72.4percent), semi pucaa proportion of improved source of drinking houses are found more in bottom quintile like water. Poorest (78.3 percent) quintile shows poorest (35.1 percent) and poor (27.6 percent). less proportion of improved cooking, whereas Katcha houses are found more in bottom richest (84.4 percent) quintile shows more quintile like poor (1.8 percent). (seeTable 7) proportion of improved cooking.Similarly, Improved water sources are found more in improved latrine is found more in top quintile top quintiles that is rich (91.5 percent) and rich (80.9 percent, whereas richest (62.5 richest (90.6 percent), where bottom quintile percent) shows marginally less proportion like poorest( 56.5 percent ) shows less as bottom quintile poor(65.2 percent). (See Figure 1: Improved Latrine Source, Cooking Source and Water Source among Wealth quintile in rural area
Fig. 1) In urban areas; Improved water cooking, where as rich (100 percent) and source found more in bottom quintiles richest (93.8 percent) quintile shows that is poorest (96.5 percent) and poor more proportion of improved cooking. (96.6 percent), whereas top quintile Similarly, improved latrines found like richest (95.8 percent) shows less more in bottom quintile poorest (89.5 proportion of improved source of percent), where poor (82.8 percent) drinking water. Poorest (89.5 percent) shows less proportion as top quintile quintile shows less proportion of improve richest (87.5 percent). (See Fig 2) IJBMR, 10(1), January - June, 2020 Page 13
INTERNATIONAL JOURNAL OF BUSINESS MANAGEMENT & RESEARCH- A Peer-Reviewed Bi-Annual Journal (ISSN: 2249-2143)
Figure 2: Improve Latrine source, Cooking source and Water Source among Wealth Quintile in Urban area
Conclusion:- status of urban and rural households and Study showed that the religion - wise lower also bottom quintiles reports less use of quintile in urban and rural areas that is poor basic amenities. Further, it is seen that basic and poorest reports less proportion. But it is amenities and socio-economic condition are contradictory, bottom quintile report higher correlated to each other. proportion of OBC as that of top quintiles. References Lower Income level in rural households Shaw, A. (2007). Basic Amenities in Urban is found more in poor as compared to top India: Analysis at State and Town Level Quintile whereas in case of urban households Calcutta: Indian Institute of Management. poor quintile shows less proportion of high Arya, Y.B., (2009). Water and Sanitation in income level and compared to top quintiles. U.P., Fresh Water Action Network for South The proportion nuclear family varies Asia (FANSA). marginally in each quintiles, whereas joint Bajpai, P. &Bhandari,L. (2001). Ensuring family is found more in bottom quintile that is Access to Water in Urban Households, poor and poorest in rural areas and in urban Economicand Political Weekly, 36(39). households, this is reverse mean joint family Marsh, A., Gordon, D. Heslop, P. report less proportion in bottom quintile and &Pantazis,C. (2000). Housing Deprivation more proportion in top quintiles. Sanitation and Health: A Longitudinal Analysis. varies across all quintile. In rural areas and HousingStudies,15(3),411-428 urban areas, bottom quintile shows less Uehara, E.S. (1994). Race, Gender and proportion of use of flush latrine. Improved Housing Inequality: An Exploration of source of cooking and drinking found less in the Correlates of Low-Quality Housing bottom quintiles than that of top quintiles. Among Clients Diagnosed with Severe Hence, we concluded that distribution of basic and Persistent Mental Illness. Journal of amenities is unequal in all socio-economic Health and Social Behavior, 35(4), 309-321.
IJBMR, 10(1), January - June, 2020 Page 14
INTERNATIONAL JOURNAL OF BUSINESS MANAGEMENT & RESEARCH- A Peer-Reviewed Bi-Annual Journal (ISSN: 2249-2143)
Krivo, L.J. & Kaufman,R.L. (2004). Housing Sample Survey Organization, 94th issue, and Wealth Inequality: Racial- Ethnic Volume XXVIII, No. 3&4, December 2008 Differences in Home Equity in the United Kumar, A.(2013, July – Dec). Access to States. Demography, 41(3), 585-605. Basic Amenities in Urban India, An Analysis Elmelech, Y. (2004). Housing Inequality in across Size Class of Towns/ Cities, Urban New York City: Racial and Ethnic Disparities India, National Institute of Urban in Homeownership and Shelter-Cost Burden. Affairs,33( 2), 127-140, Housing, Theory and Society, 21(4), 163- 175 Dreze, Jean&Amartya, Sen, (2013). An Srinivasan, K. &Mohanty,S. K. (2004). Uncertain Glory: India and Its Deprivation of Basic Amenities by Caste and Contradictions, Penguin Books, New Delhi Religion: Empirical Study Using NFHS Data, Kumar,A.(2014a). Access to Basic Amenities: Economic and Political Weekly, 39(7), 728-735 Aspects of Caste, Ethnicity and Poverty in Rural Huang, Y. &Jiang, L. (2009). Housing and Urban India-1993 to 2008–2009, Journal Inequality in Transitional Beijing. of Land and Rural Studies, 2(1), 127-148 International Journal of Urban and Kumar, A.(2014 b), Devalaya and Regional Research, 33(4), 936-956 Shauchalaya, Addressing Socio- Ahmad, S. (2012). Housing Inequality in Economic Inclusions, Journal of Studies Socially Disadvantaged Communities: in Dynamics and Change, 80-87 Evidence from Urban India, 2009. Environment and Urbanization ASIA. 3(1), 237-249 Kundu, A. Bagchi, S. &Kundu, D.(1999). Regional Distribution of Infrastructure and Basic Amenities in Urban India: Issues Concerning Empowerment of Local Bodies. Economic and Political Weekly. 34(28), 1893-1906 Srinivasan, K. &Mohanty,S. K. (2004). Deprivation of Basic Amenities by Caste and Religion: Empirical Study Using NFHS Data. Economic and Political Weekly. 39(7), 728-735 Edelman B., &Mitra,A.(2006). Slum Dwellers’ Access to Basic Amenities,The Role of Political Contact, Its Determinants and Adverse Effects. Review of Urban and Regional Development Studies. 18(1), 25-40 Census of India, (2011) P.C.Mohanan, &Chakraborty,S.(2008) Inter- state comparisons of housing conditions-a study based on NSS 58th round, Sarvekshana, Journal of National
IJBMR, 10(1), January - June, 2020 Page15
INTERNATIONAL JOURNAL OF BUSINESS MANAGEMENT & RESEARCH- A Peer-Reviewed Bi-Annual Journal (ISSN: 2249-2143) Impact of Corporate Social Responsibility on Profitability in Corpo- rate World in India-An Empirical Study Parminder Kaur Assistant Professor, Department of Commerce, St. Soldier Co. Ed. College, Jalandhar
Abstract Corporate Social Responsibility has gained much applaud in the last decade in the corporate world. CSR is a concept which has become dominant in business reporting as per the provisions of Companies Act, 2013. It is no longer acceptable for a corporation to enjoy economic prosperity in isolation from those agents impacted by its actions. International data has shown the significant relation between CSR and profitability of the firms. CSR is considered as a profit motivating decision. This paper tries to test the impact of CSR on profitability, using correlation technique, of 10 companies listed on NSE India. CSR demonstrates the reciprocal activity towards society where it works. The social responsibility discharged by the organization puts the positive impact not only on the goodwill of the firm but on the profitability as well. CSR also gives the competitive advantage to the firms. This fact has been explained in this paper that there is a positive impact of corporate social responsibility on the profitability of the firms.
Key Words: Corporate social responsibility, profitability, India, correlation. Introduction CSR as “Corporate Social Responsibility is Corporate social responsibility (CSR also the continuing commitment by business to called corporate conscience, corporate behave ethically and contribute to economic citizenship or responsible business) is a form development while improving the quality of of corporate self-regulation integrated into a life of the workforce and their families as well business model. CSR policy functions as a self- as of the local community and society at large” regulatory mechanism whereby a business Why Sustainability Programs are monitors and ensures its active compliance good for Industry Associations? with spirit of the law, ethical standards and 1. Help attract and retain members: national or international norms. With some Sustainability and CSR programming models, a firm’s implementation of CSR goes increases the value and relevance of the beyond compliance and engages in “actions association to current and prospective that appear to further some social good, members. It reduces the risk that members beyond the interests of the firm and that will have their CSR and sustainability needs which is required by law.” The aim is to reap met by other organizations or initiatives. long-term profits through favourable public 2. Enhance innovation in the sector: relations, high ethical standards to reduce Cost-effective pre-competitive CSR and business and legal risk, and shareholder trust sustainability collaborations can result in by taking responsibility for corporate actions. industry innovation, enabling the industry CSR strategies encourage the company to to improve its collective CSR impacts while make a positive impact on the environment driving business and operational benefits. and stakeholders including consumers, 3. Build positive government and NGO employees, investors, communities, and relations: Associations that increase others. their CSR or sustainability expertise are LiteratureReview better positioned to contribute positively Business dictionary defines CSR as “A to regulatory initiatives by government and company’s sense of responsibility towards other agencies and to engage constructively the community and environment (both with NGOs and other stakeholders. ecological and social) in which it operates. Associations with voluntary industry Companies express this citizenship (1) CSR and sustainability standards that through their waste and pollution reduction exceed compliance requirements are processes, (2) by contributing educational able to forestall government regulation. and social programs and (3) by earning 4. Help identify industry priorities: Many adequate returns on the employed resources.” generic global CSR and sustainability Lord Holmes and Richard Watts defined initiatives and standards are now available,
IJBMR, 10(1), January - June, 2020 Page 16
INTERNATIONAL JOURNAL OF BUSINESS MANAGEMENT & RESEARCH- A Peer-Reviewed Bi-Annual Journal (ISSN: 2249-2143) and this in turn can make priority-setting regulators have responded to this unrest and for members difficult. An industry approach the National Voluntary Guidelines for Social, can assist member companies to develop Environmental and Economic Responsibilities an industry-relevant model tailored to the of Business or the NVGs (accompanied by the sector’s most material risks and opportunities. Business Responsibility Reports mandated by 5. Fulfill association goals: Typically the SEBI for the top 100 companies) and the association goals include assisting members CSR clause within the Companies Act, 2013 to be competitive and profitable. CSR are two such instances of the steps taken and sustainability is one tool to enhance This combination of regulatory as well as member profitability and competitiveness. societal pressure has meant that companies 6. Build industry reputation and brand: An have to pursue their CSR activities more association’s CSR and sustainability program professionally. This handbook attempts to demonstrates the sector’s commitment to bring together good practices of companies sustainable practices and leadership. It can and grant-making foundations so as to build positive stakeholder relationships with assist companies pursue their CSR activities customers, communities, NGOs, suppliers effectively, while remaining aligned with the and others. In doing so, it enhances the requirements of the Companies Act, 2013. sector’s social license to operate and grow. Legislative Status 7. Enhance employee recruitment and The Companies Act, 2013 In India, the retention: Associations with CSR programs concept of CSR is governed by clause 135 of are able to attract and retain the best and the Companies Act, 2013, which was passed brightest employees who prefer to work for by both Houses of the Parliament, and had organizations aligned with their values. received the assent of the President of India Objectives on 29 August 2013. The CSR provisions 1.To study the relationship between within the Act is applicable to companies CSR expenditure and profitability. with an annual turnover of 1,000 crore INR 2.To study the impact of CSR on profitability. and more, or a net worth of 500 crore INR 3.Giving recommendations and and more, or a net profit of five crore INR suggestions to improve profitability. and more. The new rules, which will be India is a country of myriad contradictions. applicable from the the Act lists out a set of On one hand, it has grown to be one of activities eligible under CSR. Companies may the largest economies in the world, and an implement these activities taking into account increasingly important player in the emerging the local conditions after seeking board global order, on the other hand, it is still approval. The indicative activities which can home to the largest number of people living be undertaken by a company under CSR in absolute poverty (even if the proportion of have been specified under Schedule VII of the poor people has decreased) and the largest Act. The draft rules (as of September 2013) number of undernourished children. What provide a number of clarifications and while emerges is a picture of uneven distribution these are awaiting public comment before of the benefits of growth which many believe, notification, some highlights are as follows: is the root cause of social unrest. Companies • Surplus arising out of CSR activities will too have been the target of those perturbed have to be reinvested into CSR initiatives, by this uneven development and as a result, and this will be over and above the 2% their contributions to society are under figure The company can implement its CSR severe scrutiny. With increasing awareness activities through the following methods: - of this gap between the haves and the have- Directly on its own - Through its own non- nots, this scrutiny will only increase over profit foundation set- up so as to facilitate time and societal expectations will be on the this initiative - Through independently rise. Many companies have been quick to registered non-profit organizations that have sense this development, and have responded a record of at least three years in similar proactively while others have done so only such related activities - Collaborating or when pushed. Governments as well as pooling their resources with other companies
IJBMR, 10(1), January - June, 2020 Page 17
INTERNATIONAL JOURNAL OF BUSINESS MANAGEMENT & RESEARCH- A Peer-Reviewed Bi-Annual Journal (ISSN: 2249-2143)
• Only CSR activities undertaken in India put up for public comment, define net profit will be taken into consideration Activities as the profit before tax as per the books of meant exclusively for employees and their accounts, excluding profits arising from families will not qualify A format for the branches outside India. board report on CSR has been provided Research Methodology which includes amongst others, activity-wise In this research, the correlation technique , reasons for spends under 2% of the average has been used to find out the impact of net profits of the previous three years and a CSR expenditure on the profitability of the responsibility statement that the CSR policy, companies. We have collected the data of implementation and monitoring process is the companies for the year 2014-15 from the in compliance with the CSR objectives, in annual reports. To establish the relationship, letter and in spirit. This has to be signed the net profit to revenue from operations ratio by either the CEO, or the MD or a director and CSR expenditure to total assets ratio of the company Governance Clause 135 of have been used. the Act lays down the fiscal year 2014-15 Hypotheses onwards, also require companies to set-up Ho: There is no significant relation between a CSR committee consisting of their board CSR expenditure and profitability. members, including at least one independent H1: There is significant relation between CSR director. The Act encourages companies to expenditure and profitability. spend at least 2% of their average net profit Sample in the previous three years on CSR activities. In this research, sample of 10 companies The ministry’s draft rules, that have been listed on National Stock Exchange has been Table 1 : CSR Expenditure of Ten Companies Listed in National Stock Exchange
Revenue from Op- Net Profit before CSR Expenditure Name of Company Total Assets erations Tax Rs. In Crores Reliance Industries 5,04,486 761 3,75,435 31,114 SAIL 1,01,318.89 42.96 45,951.95 2463.97 ITC Ltd. 45990.79 217.41 38,834.81 14,362.05 Maruti Suzuki 34,478.6 37.25 50,801.40 4976 India Hindustan Unilever 14,430.80 8235 31,972.19 6,319.51 Ltd BHEL 70,888.68 102.06 30788.59 2,187.29 Tech Mahindra 19,848.10 58.30 22,621.30 3,618.10 Infosys 27,722 239.54 47,300 16,798 ONGC 3,37682.678 49.523 1,60,889.749 27,370.365 Tata Consultancy 73,660.88 220 94,648.41 26,298.49 services
taken. The data related to net profits before 0.054. The value of t-test is 1.883 at 5% level tax, CSR expenditure, total assets and of significance. The value of significance is revenue from operations that has been used 0.092 which shows that the null hypothesis in the research, has been extracted from the is accepted and alternative hypothesis is published annual reports of the companies. rejected. Result & Discussions Conclusions As the table shows, there is very low degree On the basis of the result, it is concluded of positive correlation between net profits and that there is positive correlation between net CSR expenditure. Coefficient of correlation is profits and CSR expenditure but degree of
IJBMR, 10(1), January - June, 2020 Page 18
INTERNATIONAL JOURNAL OF BUSINESS MANAGEMENT & RESEARCH- A Peer-Reviewed Bi-Annual Journal (ISSN: 2249-2143) correlation is very low. The result of hypothesis Stakeholders will think that when a company shows that profitability does not depend upon is fulfilling its social responsibility then how the CSR expenditure. The Indian companies it is possible that it will do anything bad for are aware of their social responsibility and them, so their trust will enhance on company. spending more for society’s welfare. But the 4. As with the passage of time impact of this expenditure on profitability is competition between the firms is increasing negligible. and stakeholders can easily switch from one Recommendations firm to another therefore firms should do 1. CSR expenditure is treated as capital investment therefore companies should more and more to attract stakeholders so that invest in CSR . companies financial performance increase. 2. Companies should continue to spend Therefore, firms should spend on performing on CSR. This will help increase the goodwill and worth of the companies. socially responsible activities.
3. Corporate social responsibility References manages reputation by creating good image in the mind of customers, suppliers etc. http://dhi.nic.in/writereaddata/
Table Showing Correlation between Net Profit Ratio CSR Ratio
Net Profit Ratio CSR Ratio Pearson Correlation 1 .054 Net Profit Ratio Sig. (2-tailed) .882 N 10 10 Pearson Correlation .054 1 CSR Ratio Sig. (2-tailed) .882 N 10 10
Source :- Author’s Calculation
Table 3 : Paired Sample t-test
Pair 1 Net Profit Ratio – CSR Ratio Mean 12.41490 Standard Deviation 20.84782 Paired Differences Std.Error Mean 6.59266
95% confidence intervals of Dif- Lower -2.49873 ference Upper 27.32853 T 1.883 Df 9 Sig. 2-tailed .092
Source :- Author’s Calculation Test
IJBMR, 10(1), January - June, 2020 Page 19
INTERNATIONAL JOURNAL OF BUSINESS MANAGEMENT & RESEARCH- A Peer-Reviewed Bi-Annual Journal (ISSN: 2249-2143)
UploadFile/BHEL%20AR%202014-15.pdf http://www.ongcindia.com/wps/ http://www.itcportal.com/about-itc/ wcm/connect/3ee30608-2cde- 46a7-a479- sh a re ho ld e r -va l u e/ann u al-rep o rts / 170207362211/ar1415. pdf?MOD=AJPERES i tc -a nnua l -re p o rt-2015/pdf/report - http://www.ril.com/ar2014-15/download- accounts-2015.pdf centre.html http://www.tatamotors.com/investors/ http://www.tcs.com/investors/ financials/70-ar-html/cons-bal-sheet.html Documents/Annual%20Reports/TCS_ http://coal.nic.in/content/annual- report- Annual_Report_2014-2015.pdf 2014-15 http://www.mahindra.com/resources/pdf/ https://www.infosys.com/investors/ listed-companies/Annual-Report-FY14-15. reports-filings/annual- report/annual/ pdf Documents/infosys-AR-15.pdf http://www.sail.co.in/sites/default/files/ ticker/anual_report_2014-15.pdf
IJBMR, 10(1), January - June, 2020 Page 20
INTERNATIONAL JOURNAL OF BUSINESS MANAGEMENT & RESEARCH- A Peer-Reviewed Bi-Annual Journal (ISSN: 2249-2143)
Role of Self-Help Groups in Women Empowerment with special reference to Jammu and Kashmir *Mohd Ashraf Mir **Dr. Payal Bassi *Research Scholar, Desh Bhagat University, Mandi Gobindgarh ** Associate Professor, RIMT University, Mandi Gobindgarh Abstract The territory of Jammu and Kashmir witness armed conflict from past two and a half decades which has crippled the economy of the state has now become a known fact. The conflict nature of the state has badly affected people’s livelihood, their living environment etc. But the truth is that the female folk of the valley has suffered worst. So, the formalization of self-help groups can be a fruitful weapon for the Empowerment of Kashmiri women. By executing these Self Help Groups women can be helped to learn various skill development programmes for their social and political development.
Keywords: SHG, Women Empowerment, Rural Development, JKWDC Introduction and community they live by inculcating the Jammu and Kashmir has faced armed conflict experiences about saving, budgeting and since last 25 years that negatively affected gaining knowledge to face various social and people’s livelihood, living environment, legal issues. Being a part of Self Help Group, health, eating habits, work and access to women need not to depend on others for any education. In this emerging crisis, women help; instead she can seek it from Self Help as a weaker section felt the most adverse Group to which she belongs. She can start an consequences at social, economic, political, income generation activity and can possibly health and educational fronts with huge have ample of opportunities to express herself. section of women as widows and half-widows. The idea of Self Help Group could be a device So, the problems of women especially of rural to engage ladies in marginalized families. It areas need to be addressed on priority basis initially results in economic empowerment, in order to ensure the overall sustainable but gradually leads to broader empowerment development of nation. Arrangement of in the areas of social and political contexts. Self Help Group (SHG) may be a powerful It forms a basis through which the activities medium that can guarantee the all circular related to economic development of improvement of ladies especially in rustic marginalized community can be implemented. regions. The affect of Self Help Groups is The Rio Declaration (1992) expressed that noteworthy in terms of self-worth like certainty “women have an imperative part to play in cum capacity building by demonstrating self natural administration and improvement business openings to meet the budgetary and after that full interest is basic for emergency. It moreover progresses the choice accomplishing feasible advancement. This making capacity in terms of different social, can be efficiently achieved through group political, financial, wellbeing and instructive efforts. Hillary Clinton (1995) said “it is issues and mobilizes ladies to battle against called micro and its impact is macro. The different sorts of abuses against them in data and introduction related to different family and society at huge. The formation of formative plans propelled by the Government Self Help Group is not ultimately a micro- is spread to Self Help Groups through the credit project but an empowerment process facilitators within the group so that members which means increased development in can know approximately their rights. capacity. Since women have limited access to Self Help Groups are novel and imaginative developmental services provided by various organizational setup in India for the ladies Government agencies, so formation of SHG is upliftment and welfare. All ladies in India are a viable alternative for them to ensure their given chance to connect any one of Self Help development and to address their challenges. Groups for preparing and improvement, so as It is the most effective way to attain self to be planned business person and talented reliance and social empowerment. It not only specialist. The Self Help Groups are advanced empowers the women but also their family by the Government as in case ladies in India
IJBMR, 10(1), January - June, 2020 Page 21
INTERNATIONAL JOURNAL OF BUSINESS MANAGEMENT & RESEARCH- A Peer-Reviewed Bi-Annual Journal (ISSN: 2249-2143) may not be clever sufficient to be business a vehicle to pursue diverse developmental people. When the Self Help Groups orchestrate agendas and even for the profit motive. preparing offices to carry out certain kind Kondal (2014) it states that women’s of work which are appropriate for ladies in participation in self-help groups has obviously India, bank must organize money related had a tremendous impact on poor women’s help to carry out fabricating and exchanging way of life and style and empowered them at exercises, orchestrating promoting offices different levels not only as individuals but whereas the Governments will obtain the also as members of the community’s family item of Self Help Groups, orchestrate for and society as a whole. They come together upgrading the capacity of ladies in terms of for the reason of solving their common issues administration quality and orchestrating for through self-help and mutual help. The more the administration of Self Help Groups by alluring plot with less exertion is Self Help themselves so as to have authoritative capacity. Groups (SHGs). It could be an instrument to As a social development with government evacuate destitution and move forward the bolster. Self Help Groups ended up more ladies business enterprise . or less a portion and allocate of the society. Methodology Review of Literature Both primary and secondary data was Senapoti and Dutta (2011) in his paper employed for preparing this article. Self Empowerment of Women has been recognized Help Groups (SHGs) and some Non- as central issue in deciding the status of Governmental Organization (NGOs) ladies. Empowerment covers perspectives where interacted and interviewed to get such as women’s control over materials and the primary data. The secondary data mental assets. The concept of Empowerment has been collected from books, journals, has been the subject of much mental research papers, magazines, newspapers dialog and examination. Empowerment is etc. The data collected was analyzed. characterized as the forms by which ladies Emergence of Self Help Group take control and proprietorship of their lives The concept of self-help groups serves the through development of their choice. Thus guideline „by the ladies, of the ladies, and for it is the process of acquiring the ability to the ladies. The beginning of self-help groups make strategic life choice in a context where is from the brain child of Gramin Bank of this ability has previously been denied. The Bangladesh, which was established by a Self Help Group (SHG) may be a gather of financial analyst Prof. Mohammad Yunus country destitute who volunteer to organize of Chittagong University within the year themselves in a bunch for annihilation of 1975, (Dr.B. Suguna, and Empowerment destitution of the bunch individuals. In a of Rustic Ladies through self-help groups). perfect world, on a more extensive canvas, This was only built up for the destitute. The SHGs can end up an additional conventional self-help group development got to be a quiet device for women’s Empowerment. transformation within a brief span within Sahoo (2013) stated that most of the women the country credit conveyance framework in in SHGs were in the age group of 30 and numerous parts of the world. In 1997, World women in SHG for taking a loan for personal Small scale Credit Summit at Washington use. Monthly income and expenditure have focalized the created and the creating nations been increased after the joining SHG and most to handle the genuine issue of destitution of the women accepted /feel that their power by utilizing smaller scale credit as an has increased in taking decisions after joining instrument to engage the poorest segment. SHGs either inside or outside of their family. Objectives of Self Help Group Rathore and Garg (2013) have quoted that The main objectives of self-help groups are:- Microfinance through Self Help Groups To teach the routine of saving and managing (SHGs) has become an important vehicle an account among the provincial women. to meet the savings and credit needs of To construct up believe and certainty the poor, especially women in rural areas. between the rustic women and the financiers. Das (2013) . Self Help Group today has become To create group action so that different
IJBMR, 10(1), January - June, 2020 Page 22
INTERNATIONAL JOURNAL OF BUSINESS MANAGEMENT & RESEARCH- A Peer-Reviewed Bi-Annual Journal (ISSN: 2249-2143) welfare and formative programs can and Zoroastrians are being financed under the be executed in distant better way with national minorities’ development and finance the interest of these women group. corporation (Dr.kavitasuri April 2003). To accomplish women and child welfare 2. Swarnjayanti Gram SwarozgarYojana programobjectivesbyeffectivelyincludingthese (SGSY). This scheme was introduced in women groups in all inclusive immunizational 1999 with the objective of developing micro programs, little family standards, enterprise in rural areas, thereby building widespread rudimentary instruction etc. upon the potentials of rural poor belonging to Livelihood Issues of Jammu and Kashmir below poverty line families beneath the plot, Women monetary help both withinthe shape of advance As per subtle elements from census 2011, and endowment is given to the recipients, Jammu and Kashmir has populace of 1.25 both people as well as self-help group, to set crores, of which male are 6,640,662 and female up their own endeavor. The Swarnjayanti are 5,900,640. Sex proportion in Jammu and Gram Swarozgar Yojana plot is executed in Kashmir is 889 i.e. for each 1000 male, which all the districts of Jammu and Kashmir more is underneath national normal of 940 as per or less as per the direct lines of the conspire census 2011. Hence, showing a decreased sex as per its report. The report; in any case, says proportion. The whole work drive in 2001 was that this plot lays overwhelming accentuation 37.54 lakh laborers comprising of 26.80 lakh on the formation of women’s self-help groups. males and 10.74 lakh females. In this way, 3. Jammu and Kashmir Women’s Development ladies can be demonstrated as a noteworthy corporation (JKWDC) has put forth various supporter to the developing economy. Ladies socio-economic schemes for the upliftment are the key operators for improvement. A of women belonging to minorities, backward number of plans have been propelled from and other classes (Dr. Kavitasuri April 2013). time to time for the upliftment of the ladies. 4. Different social welfare offices are Jairam Ramesh, the previous union minister too actualized different plans for the for Rural development, has said that state womens. At display, there are 150 social of Jammu and Kashmir will have 90,000 welfare centers which give different sorts self-help groups within the following five a of abilities to the women society. 5. A long time beneath National Rural Livelihood program of Empowering trained youthful Mission, locally named “Umeed” (Greater Women launched on 8th March, 2010. Jammu, August 2013) as a corner stone of 6. Swayam Sidha training is provided to national destitution lessening technique. The SGHs for their economic empowerment and center conviction of National Rural Livelihood government provides 100% grant in aid for Mission is that the destitute have intrinsic implementing the scheme (Suri, K, 2013). capabilities and a solid crave to come out Functions and Structure of Self Help Groups of destitution. The essential thought behind The perfect estimate of a self-help group is 10 National Rural Livelihood Mission is to make to 20 members. In spite of the fact that, there’s self-help groups particularly for ladies and help no difficult and to begin with run the show as them to begin a few entrepreneurial activities. respects to the participation, still in a greater Capacity Building of Women in Jammu group, members are not dynamic to take an and Kashmir interest. Too, legitimately it is required that a The truth is known that the women of casual group ought to not be of more than 20 Jammu and Kashmir have endured a part members. The group needs not to be registered. amid the final 25 a long time. Hence, capacity Membership: building can be one of the imperative choices 1. As it were one person from a family can to assist these women from their financial get to be a part of a self-help group (more trouble. For this reason, government has families can connect self-help group this way). propelled a few schemes/programmes for 2. The group ordinarily comprises of the upliftment of women; a few of these are; either as it were men or as it were women. 1. Women belonging to minority community 3. Women group are by and like Muslims, Buddhists, Sikhs, Christians,
IJBMR, 10(1), January - June, 2020 Page 23
INTERNATIONAL JOURNAL OF BUSINESS MANAGEMENT & RESEARCH- A Peer-Reviewed Bi-Annual Journal (ISSN: 2249-2143)
large found to perform well. 92,000 and begun the economic activity. 4.Members ought to be between The self-help group anticipates effective age group of 21-60 a long time. development of their economic activity. Up The primary function of self-help group is till presently, they have been able to produce that all the members ought to advance rules a considerable income. The said income has and regulations; a few illustrative rules for the made a difference for them in assembly the detailing of such rules and regulations are; essential instructive needs of their children. Meetings: The group ought to meet at regular On meeting the well known women of the interval. self help group specifically Haseena Bano Compulsory attendance: Full attendances cluster cordinator of cluster E at Nowgam. in all the group meetings will make it simple to 2.Khushi Self Help Group stabilize and begin working to the fulfillment The Khushi Self Help Group is located at of all. Membership register, minutes register Check Ganastan in area Bandipora.It has etc to be kept up to date by the group by been built up in 23rd July 2014. The group making the entries routinely. has ten members. Each of them contributed Record Keeping: It is conceivably the on month to month premise from their foremost imperative function in a self-help residential investment funds as Rs 50 at first group regularly limited to the outskirts. and directly Rs 100 per month. The display Group vigilance: The corpus fund of a group action of the group is agriculture related is completely contributed by its members and work and carpet weaving. They have bought consequently they alone must ensure that a chunk of land on rent premise. It is used the fund is managed and controlled by them for cultivation of vegetables and significant without any exterior obstructions, whatsoever. benefit is accomplished out of it. The other Banking relationship: Self-help groups are social activities incorporate giving loan to essentially savings and credit groups and members for tutoring of children, wellbeing profiting savings and credit services from care, and minor development work. The group nearby bank could be a consistent expansion targets to raise the economic standard of their of their development methodology to meet members and include other people as well in it. expanding credit demand from members. Analysis Additionally, getting to savings from banks The Self Help Groups have primary work to will give security to the pooled fund. The financially engage the members included. information collected from field uncovered The members join the group on voluntary the following information. The same is being basis. They are necessary to contribute out displayed within the frame of case ponders. of their personal pouch to begin a financial Case studies action. In any case they are guided by a The two case studies are below: few organizations, government or non- 1.Habakhatoon Self Help Group governmental organizations. Within the over This Self Help Group has been built up in cases two of the self-help groups were able 15th November 2014.It is located at Village to run these effectively. They have been able Nowgam Sumbal block in area Bandipora. to speed up towards the target they have The group comprises twelve members all are settled. They got legitimate outside as well as females. The seven members had a place to inside back .The SHG like over two can be a underneath destitution line and five members source of motivation for the other people who had a place to over destitution line families. wish to gain a considerable income for the The group at first begun with the objective satisfaction of the fundamental needs of their of joint utilization of the participation stores family. The groups can involve themselves pooled. Afterward with the combination of with diverse crafts/arts which are found the group, the income generating activities within the society and can look for the back of were begun, which included carpet government organizations etc to market these weaving, tailoring and sozne work. In this products. In this way they can be source for regard, the group collected a sum of Rs the defending their skills in different crafts.
IJBMR, 10(1), January - June, 2020 Page 24
INTERNATIONAL JOURNAL OF BUSINESS MANAGEMENT & RESEARCH- A Peer-Reviewed Bi-Annual Journal (ISSN: 2249-2143)
Because it has been found that middle men References all over valley misuse the craftsmen/ artisan. Senapoti and Dutta (2011). Economic The dealer and the middle man reap the Empowerment Of Women Through SHGS good thing about the difficult work of the Indibrugarh District, Assam: A SWOT craftsmen. This Self Help Group can be a Analysis Indian Journal of Commerce making a difference hand in this respect. & Management Studies pp 28-33 Conclusion Sahoo, A( 2013 ).Self Help Group & Women The Self Help Groups anyplace can be a Empowerment study on some selected solid method of financial strengthening of SHGs .International Journal of financially weaker areas of the society. The Business Management Invention members having energy to work truly and Rathore and Garg(2013). “Role of Financial dedicatedly are able to reach to the objective, Inclusion Through Self Help Group: A Study indeed in the event that continuously. There of Selected SHGs In Yamuna Nagar (District is requiring of back from the territory, family Haryana) India”, International Journal heads of the members included, and outside of Advanced Research in Management organizations. The concept of Self Help Group and Social Sciences, 2(2) pp.126-141. has great scope within the show widespread Das S.K (2013). Perception of Group Members unemployment situation. Government and on Self Help Groups‘Impact: An Empirical NGOs must include all the poor members’ Study. International Journal of Business provincial as well as urban ones and those and Management. 1(1) July 2013. P. 13-28. belonging to financially powerless groups Kondal(2014).Women Empowerment to take an interest within the SHGs. In any through Self Help Groups in Andhra case, there is requiring that they must be well Pradesh India. International Research taught around the strategy and hardships Journal of Social sciences, 3(1), 13-16 . they can confront in making these groups fruitful.
IJBMR, 10(1), January - June, 2020 Page 25
INTERNATIONAL JOURNAL OF BUSINESS MANAGEMENT & RESEARCH- A Peer-Reviewed Bi-Annual Journal (ISSN: 2249-2143) Goods and Services Tax (GST) and Its Impact on Indian Economy Impreet kaur, Assistant Professor, Future Foundation Institute, Ludhiana
Abstract The enforcement of Goods and Services tax was for long -term benefit. There were very few sectors that received an immediate benefit from the implementation of Goods and Services Tax (GST). The long-term benefit requires the patience of citizens. Where one sector in the country faces a positive aspect, on the other hand, the other sector faced the negative aspect. It is very important to know how and to whom the Goods and Services Tax (GST) had impacted. In a country where the population is 133.92 crores, [Source: World Bank, United States Census Bureau], implementation of a new tax regime was not less a big hurdle. It was required that the authority first understand the concept then it will be easy for the citizens to implement the concept of “One Nation One Tax”.
Keywords: Goods and Services Tax, Indian Economy Introduction GST. Fertilisers, an important element of GST is a consumption-based tax levied on agriculture, was previously taxed at 6% (1% sale, manufacture and consumption on goods Excise + 5% VAT). In the GST regime, the tax & services at a national level. This tax will be on fertilisers has been increased to 12%. The a substitute for all indirect tax as levied by same impact is on Tractors. Waiver on the state and central government. Exports and manufacture of Tractors is removed and GST direct tax like income tax, corporate tax and of 12% has been imposed. This is beneficial capital gain tax will not be affected by GST. as now the manufacturers will be able to Advantages of GST claim Input Tax Credit 1. Eliminate cascading effect of tax India’s milk production in 2015-16 was 2.Higher threshold for registration 160.35 million ton, increased from 146.31mt 3.Composition Scheme for small business in 2014-15.Currently, only 2% VAT is 4.Easy online procedure charged on milk and certain milk products 5.Lesser complications but under GST the rate of fresh milk is nil 6.Improved efficiency of logistics and skimmed milk is kept under 5% bracket 7.Regulated unorganised sector and condensed milk is going to be taxed at Disadvantages of GST the rate of 18%. Tea is probably one of the 1. High cost of software most crucial items in an Indian household. 2.Increased Operational cost The price of tea might also increase due to 3.SME will have higher tax burden the tax rate of 5% under GST rate from the 4.Entire Online system current average VAT rate of 4-5% with Assam Objective of the Study and West Bengal with the exception of 0.5 To study the impact of GST on various and 1%. sectors of Economy viz: Primary, Secondary 2. Impact on Manufacturing Sector and Tertiary sector. (a)Iron and Steel Industry Impact of GST on Various Sectors Three types of taxes are applied or imposed 1.Impact of GST on Primary Sector on the manufacturing of iron and steel. Those (a)Agricultural Sector taxes are: - GST is essential to improve the transparency, 1. 12.5% of Excise Duty reliability and timeline of supply chain 2. 5% of the Average Value Added Tax (VAT) mechanism. A better supply chain mechanism 3. 2% Central Sales Tax (CST) would ensure a reduction in wastage and There is a total of 19.5% net tax which is cost for the farmers/retailers. GST would imposed upon iron and steel. If there is an also help in reducing the cost of heavy article which is manufactured of iron and machinery required for producing agricultural steel are charged at the rate of 19.5%. The commodities. Under the model GST law, dairy rate of the tax charged is similar to the tax farming, poultry farming, and stock breeding rate for manufacturing iron and steel. In are kept out of the definition of agriculture. Punjab, the Value Added Tax (VAT) is 2.5% Therefore, these will be taxable under the for the substances or commodities which are
IJBMR, 10(1), January - June, 2020 Page 26
INTERNATIONAL JOURNAL OF BUSINESS MANAGEMENT & RESEARCH- A Peer-Reviewed Bi-Annual Journal (ISSN: 2249-2143) of iron and steel. Thus ,the pattern of tax (CGST) and the second is State Goods and charged is not the same in whole India. Services Tax (SGST). CGST is the domain Goods and Services Tax (GST) has a positive of Government and SGST is the domain of impact on the iron and steel and material State Government. With the advent of these made up of these. Kitchen utensils that are two types of Goods and Services Tax (GST), useful in day to day life become cheaper than the whole code or protocol of the banks and the previous. Utensils like pan, stainless steel relating sectors are altered in a stipulation cooker and many more are now charged with of the service which they provide to all 12% of Goods and Services Tax (GST). It is consumers. charged 7.5% less than the current tax laws. Every consumer or customer having their There are benefits for all the steel-related account in any bank has been offered a companies as there is a 5% low tax rate on “point of supply identification”. This helps all the large inputs used by them under the the customers in transfer of money in any Goods and Services Tax (GST). These inputs part of India. If a person has an account in are iron ore, coal, etc. a remote area, he will easily transfer money All the industries relating to Iron and Steel with the limitation of amount subjected to are getting benefits with the introduction of rules stated by Reserve Bank of India (RBI). Goods and Services Tax (GST). There is an Before the imposition of Goods and Services expectation that it will help in furthermore Tax (GST), the input tax credit was not benefits by reducing or lowering the input tax granted in accordance with the Central Value and logistics. Added Tax (CENVAT) protocols or code. 3. Impact on Service Sector However, after the Goods and Services Tax (a) Banking Sector (GST), the input credit tax is acknowledged to With the imposition of Goods and Services all the banks which will ultimately reduce the Tax (GST), the banking sector hasbecame evasion of tax when there are external supply more expensive. Previously, the tax on all funds. the services relating to banking was 15% but After Goods and Services Tax (GST), the after the enforcement of Goods and Services banking sector has approach in the whole of Tax (GST), the tax rate on all the banking India and even in the acquaintance countries service was increased upto18%. for the purpose of ensuring the continuous After the implementation of the Goods and and steady business. The sudden growing and Services Tax (GST), every bank is required spreading of business will lead to increase in to obtain a separate registration for all the claim of funds. And as the demand for funds branches within them. Before Goods and will increase, this will ultimately benefit the Services Tax (GST), all the employees working banks because of expansion in the number in the banks were getting out of their relief of transactions. mode because there was a concept of “single Every bank gives a variety of services to all centralized registration” for all the branches of its customers or consumers such as credit of banks. It was a complex task to be done card, debit card, internet banking, etc. When in a country like India because there were Goods and Services Tax (GST) came into excessive numbers of banks having a more force, there was an amendment in the rules excessive number of branches prevailing in and regulations relating to the banks and this India. The transaction between banks was emerged as the upgradation of all e-system not free including the Automated Teller Machine After the implementation of Goods and (ATM) and all the systems related to the Services Tax (GST), the money transaction, transaction as demanded by the department whether it was internally or externally, of IT. between the two different banks is done by 4. Real Estate imposing the tax. Before the GST, it was free. The imposition of Goods and Services Tax Under Goods and Services Tax (GST), there (GST) has some positive impact on the are two different kinds of taxes prevailing in property and real estate. Property buyers are India. First, Central Goods and Services Tax in profit due to the Goods and Services Tax
IJBMR, 10(1), January - June, 2020 Page 27
INTERNATIONAL JOURNAL OF BUSINESS MANAGEMENT & RESEARCH- A Peer-Reviewed Bi-Annual Journal (ISSN: 2249-2143)
(GST). 12% Goods and Services Tax (GST) completed, they are liable to pay registration charges of property value are liable on all charges and stamp duty. The state has the under-construction properties. It does not power to levy the stamp duty, Value Added include stamp duty and the charges on the Tax (VAT) and Registration Charges and all registration. Previously this provision was the figures of tax differ from state to state. applied in the properties which are prepared Centre has the power to levy the service or ready. tax and it was charged upon the There is an increase in profit for the builders construction. This makes the tax scheme and developers due to the input tax credit. very much complicated for all the buyers, This will additionally the profit to homebuyers. but Goods and Services Tax (GST) has According to them changed tax scheme, made this simpler. the under-construction properties i.e. flats Under Goods and Services Tax (GST) and buildings will be charged 18% Goods regime, tax is charged upon all the under- and Services Tax (GST) in which 9% will be construction properties are at 12% of the State Goods and Services Tax (SGST) and value of the property. It does not include the 9% will be Central Goods and Services Tax registration charges and stamp duty. There (CGST). The government has the power to was no imposition of indirect tax on the sale deduct the land value equal to the 1/3rd of property which is ready-to-move that is of the total amount which is charged by why there is no applicability of Goods and the builder. It will make the efficient rate Services Tax (GST) on sale of the ready-to- of tax as 12%. Positive Impact on Buyers move properties. Goods and Services Tax (GST) has some Positive Impact on Builders positive impact on the prices of property. It Before the enforcement of Goods and Services makes the tax system easy for all the buyers. Tax (GST), a developer or builder had to pay Before Goods and Services Tax (GST), buyers Value Added Tax (VAT), Central Excise Duty were accountable to pay the taxes which and Entry taxes which was the state domain. depends upon the property’s construction The state was collecting those taxes on the status and the state in which the property is cost of construction material. Developer and located. the builder were also liable to pay the tax at Buyers were also liable to pay the Value 15% for services such as approval charges, Added Tax (VAT), stamp duty, service tax, architect fees, labour, legal character, etc. and registration charges when they bought After the Goods and Services Tax (GST), there the under-construction property. But when was not much variation in the construction they buy the property which was ready or costs. In addition, logistics reduced cost will Table 1 : Comparison of Value Added Tax & Goods and Services Tax on Different Materials
Sr. No. Substance or Material Value Added Tax (VAT) Goods and Services Tax (GST) 1. Iron pillars and iron 20% 18% rods 2. Fly ash bricks and Sand 6% 5% lime bricks 3. Cement 20 to 24% 28% 4. Ceramic tiles, plaster, 20 to 25% 18% wallpaper, wall fittings, paint
IJBMR, 10(1), January - June, 2020 Page 28
INTERNATIONAL JOURNAL OF BUSINESS MANAGEMENT & RESEARCH- A Peer-Reviewed Bi-Annual Journal (ISSN: 2249-2143) lead to a lessening of expenses. To increase (GDP). The only thing required is to have the profit, the input tax credit is helpful. patience and continuous following of rules and Conclusion regulationsfor uplifting the country’s economy. The aim of the government is to bring India References into an umbrella of one tax promoting the “One https://cleartax.in/s/gst-real-estate- sector- Nation One Tax” system. Implementation of affect Goods and Services Tax (GST) substituted htt ps: //qui ckbooks . i nt ui t . c om /i n/ the regime of Value Added Tax (VAT) in resources/finance-and-accounting-taxes/ India. It merged all the indirect taxes which impact-of-gst-on-manufacturing-sector-in- was prevailing in the country during Value india/ Added Tax (VAT) regime. Imposition of Goods https://cleartax.in/s/impact-of-gst-on- and Service Tax (GST) was a big task in a agricultural-sector country like India where new changes are not http://gstinindia.in/Impact-of-GST-on-the- easily accepted. It was a complex system to Banking-Sector.aspx understand at first but later it is coming out https://taxguru.in/goods-and-service-tax/ as a long -term benefit for the country. There impact-gst-steel-industry.html are the various sectoral impact of Goods ht t ps: //econom i ct i mes. i ndi at i mes. and Services Tax (GST). Some sectors show a com/industry/ indl-goods/svs/ steel/ positive impact while others show a negative steel-industry-likely-to-benefit-from- impact. Due to a long- term benefit scheme, g s t - r a t e - s t a n d s - at- 18- p e r - c e n t / there is a less immediate positive impact on articleshow/58751901.cms Indian society and economy. However, it is https://www.deskera.in › gst-benefits-and- expected that there is an expectation of the impact-on-indian-economy growth of Indian Gross Domestic Product
IJBMR, 10(1), January - June, 2020 Page 29
INTERNATIONAL JOURNAL OF BUSINESS MANAGEMENT & RESEARCH- A Peer-Reviewed Bi-Annual Journal (ISSN: 2249-2143)
Strategies in Response to Porter’s Competitive Forces in Electronic Commerce Manu Sharma Research Scholar, Business Studies GNA University, Phagwara, India. Abstract E-Commerce or Electronic Commerce refers to use of the Internet to conduct business transactions. The amount of trade conducted electronically has grown extraordinarily since the spread of the Internet. E-Commerce is fundamentally changing the economy and the way business is conducted. E-Commerce forces companies to adopt new strategies to expand the markets in which they compete, to attract and retain customers by tailoring products and services to their needs, and to restructure their business processes to deliver products and services more efficiently and effectively. As businesses shift their focus from building a customer base to increasing revenue growth and profitability, companies should re- evaluate their current business strategies, if any, and develop new strategies that provide a clear path to success. This paper focuses on McCarthy’s four Marketing Mix model and Porter’s five competitive forces model for understanding strategies adopted by Internet companies that respond to the five competitive forces and thereby achieve a competitive advantage over others.
Key Words: E-Commerce, E-Business, Marketing Mix, Competitive Forces. Introduction E-Commerce Industry. The emergence of E-commerce is creating Methodology fundamental changes to the way business is Secondary sources including books, research conducted. The E-Commerce Industry has papers and journals are used for the purpose come a long way since its early days. The of study. market has matured and new players have Background entered the market space. E -commerce McCarthy’s Four Marketing Mix Model includes not only buying and selling goods The marketing mix (also known as the 4 Ps) over Internet, but also various business is a foundation model in marketing. The processes within individual organizations that marketing mix has been defined as the set of support the goal. Electronic Commerce refers marketing tools that the firm uses to pursue to a wide range of online business activities its marketing objectives in order to sustain in for products and services. It also pertains to the marketing for long run. It refers to four any form of business transaction in which broad levels of marketing decision, namely: the parties interact electronically rather than product, price, promotion, and place. by physical exchanges or direct physical Edmund Jerome McCarthy was an American contact. To deal with, the competition is the marketing professor and author. He proposed most important essence of today’s business. the concept of the 4 Ps marketing mix in 1960. The organization’s growth and profitability According to McCarthy (1960) and Perreault primarily depends upon how effectively and McCarthy (1999), a firm develops its organization deals with the competitor’s marketing strategies by first identifying the strategies, products, cost and profit level etc. target market for its products or services. It McCarthy’s (1960) four marketing mix model then develops a marketing mix—a particular and Porter’s (1980, 1985) five competitive combination of product, price, promotion, forces model helps to identify strategies and place (i.e., distribution and delivery for facing five competitive forces in thereby functions in the supply chain) designed to achieve a competitive advantage and provide enhance sales to the target market. A unique significant new insights into the development mix of these elements in a given industry and implementation of e-business strategies allows firms to compete more effectively, thus that contribute to increased profit. ensuring profitability and sustainability. For Research Objectives example, by coordinating various product To understand the strategies that can offerings and associated price discriminations be derived from the four marketing mix with sales promotions and effective logistics, responding to the five competitive forces and a firm can increase its sales and profit. Since thereby brings a competitive advantage to the Internet has a significant impact on
IJBMR, 10(1), January - June, 2020 Page 30
INTERNATIONAL JOURNAL OF BUSINESS MANAGEMENT & RESEARCH- A Peer-Reviewed Bi-Annual Journal (ISSN: 2249-2143) the makeup of this marketing mix, Internet (cost leadership). A company can also companies should develop strategies that achieve competitive advantage by altering take the unique nature of online marketing the competitive forces. The five competitive into account.The marketing 4Ps comprises of forces model provides a solid base for following (Van Waterschoot, W., & Van den developing business strategies that generate Bulte, C 1992). strategic opportunities. Since the Internet Product – The first of the Four Ps of marketing dramatically affects these competitive forces, is product.A product is an item that is built E- Commerce companies should take these or produced to satisfy the needs of a certain forces into account when formulating their group of people. It is important for marketers strategies. Porter (2001) remphasized the to reinvent their products to stimulate more importance of analyzing the five competitive demand once it reaches the sales decline forces in developing strategies for competitive phase. advantage.Following are the Porter’s five forces Price –Price of the product is basically the of competition analysis (Karagiannopoulos amount that a customer pays for to enjoy it. et.al. 2005): Price is a very important component of the I. Bargaining Power of Suppliers marketing mix as it determines firm’s profit The term ‘suppliers’ comprises all sources and survival. for inputs that are needed in order to provide Place -Place decisions outline where the goods or services. Supplier bargaining power product is sold and how it is delivered to the is likely to be high when: market .The goal of business executives is to The market is dominated by a few large get their products in front of the consumers suppliers rather than a fragmented source of who are most likely to buy them. supply. Promotion- Promotion includes advertising, There are no substitutes for the particular public relations and promotional strategy. input. This tie into the other three Ps of the The supplier’s customers are fragmented, so marketing mix as promoting a product shows their bargaining power is low. consumers why they need it and why they should be willing to pay a certain price for it. II. Bargaining Power of Customers Porter’s Five Competitive Forces Model The bargaining power of customers Michael Porter provided a framework that determines how much customers can impose models an industry as being influenced pressure on margins and volumes.Customers by five forces. According to Porter (1980, bargaining power is likely to be high when: 1985) and Porter and Millar (1985), a firm They buy large in volume, there is a develops its business strategies in order to concentration of buyers. obtain competitive advantage in terms of The product is undifferentiated and can be increased profit over its competitors. It does replaced by substitutes. this by responding to five primary forces: (1) Switching to an alternative product is the threat of new entrants, (2) rivalry among relatively simple and is not related to high existing firms within an industry, (3) the costs. threat of substitute products/services, (4) Customers have low margins and are price- the bargaining power of suppliers, and (5) sensitive. the bargaining power of buyers. A company The customer knows about the production assesses these five competitive forces , then costs of the product. tries to develop the market at those points III. Threat of New Entrants where the forces are weak (Porter 1979). The competition in any industry is higher, For example, if the company is a low-cost the easier it is for other companies to enter producer, it may choose powerful buyers and into this industry. In such a situation, new sell them only products not vulnerable from entrants could change major determinants substitutes. The company positions itself of the market environment (e.g. market so as to be least vulnerable to competitive shares, prices, customer loyalty) at any forces while exploiting its unique advantage time. There is always a latent pressure for
IJBMR, 10(1), January - June, 2020 Page 31
INTERNATIONAL JOURNAL OF BUSINESS MANAGEMENT & RESEARCH- A Peer-Reviewed Bi-Annual Journal (ISSN: 2249-2143) reaction and adjustment for existing players the number of people with Internet access in- in this industry. The threat of new entries creases, the competition for online business will depend on the extent to which there are in many industries will also increase. barriers to entry. These are typically: The Internet also brings many more compa- Economies of scale (minimum size require- nies into competition with one another by ments for profitable operations). expanding geographic markets (Porter 2001). High initial investments and fixed costs. The Internet changes the basis of competition Cost advantages of existing players due to by radically altering product/service offer- experience curve effects of operation with ful- ings and the cost structure of firms (e.g., cost ly depreciated assets. reductions in production, distribution, and Brand loyalty of customers. transaction). The Internet also changes the Scarcity of important resources, e.g. quali- balance of power in relationships with buy- fied expert staff. ers and suppliers by increasing or decreasing IV. Threat of Substitutes the switching costs of these buyers and sup- A threat from substitutes exists if there are pliers. By reducing customers’ search costs, alternative products with lower prices of bet- the Internet makes price comparison easy for ter performance parameters for the same pur- customers, and thus increases price compe- pose. They could potentially attract a signifi- tition (Bakos 1998). The price competition re- cant proportion of market volume and hence sulting from lowered customer search costs reduce the potential sales volume for existing increases rivalry among existing competitors players. This category also relates to comple- reduces switching costs of customers, and mentary products. Similarly to the threat of thereby shifts bargaining power to custom- new entrants, the treat of substitutes is de- ers. termined by factors like The Internet creates new substitution threats Brand loyalty of customers by enabling new approaches to meeting cus- Close customer relationships tomer needs and performing business func- Switching costs for customers tions (Porter 2001). The Internet also facili- The relative price for performance of substi- tates an electronic integration of the supply tutes chain activities, achieving efficient distribu- Current trends. tion and delivery. It also facilitates partner- V. Competitive Rivalry between Existing ships or strategic alliances by networking Players partners or allies. This force describes the intensity of competi- E-Business Strategies for Competitive Ad- tion between existing players in an industry. vantage Responding to Five Competitive High competitive pressure results in pressure Forces on prices, margins, and hence, on profitabil- This section considers the impact of the In- ity for every single company in the industry. ternet on marketing mix and competitive Competition between existing players is likely forces, and suggests strategies for achieving to be high when: a competitive advantage. There are many players of about the same Product Strategy size. On the Internet, consumers can easily collect Players have similar strategies. information about products or services There is not much differentiation between without travelling to stores to inspect players and their products; hence, there is products and compare prices. In the offline much price competition. market researching about the product can Impact of the Internet on Marketing Mix be extremely expensive and time consuming. and Competitive Forces As a result, consumers rely on suppliers The Internet can dramatically lower entry and retailers to aid them in the search, and barriers for new competitors. Companies can the suppliers and retailers take advantage enter into E-commerce easily because they of this situation by charging higher prices do not need sales forces and huge capital in- (Allen and Fjermestad 2000). Consumers vestments as they do in offline markets. As end up paying more and often not getting
IJBMR, 10(1), January - June, 2020 Page 32
INTERNATIONAL JOURNAL OF BUSINESS MANAGEMENT & RESEARCH- A Peer-Reviewed Bi-Annual Journal (ISSN: 2249-2143) the product they really wanted. However, in such as market information, managerial E-Commerce Market, a complete search of or technical expertise, and knowledge. Like product offerings is possible at virtually no traditional companies, Internet companies cost. Because consumers can easily compare can also expand their product line into areas prices and find close substitutes, companies related to their existing product lines. are forced to lower prices. Companies cannot Price Strategy achieve competitive advantage simply by The Internet enables consumers to compare exploiting consumers as in physical market. prices, products, and services across An alternative is for companies to make suppliers. For example, by logging on to consumers’ product comparison more price-comparison sites like Pricescan.com difficult by differentiating their products from and shopping agents like Bottomdollar.com, others. Possible competitive product related consumers can readily compare the prices strategies are: and features of more than 10,000 products Product bundling: Product bundling available on the Web (Sinha 2000). This leads promotes the benefits of the whole package, to increased price competition and lowers thus keeping buyers from comparing the prices of products or services. According individual items. to Bakos (1998), lower search costs for Innovation or the Introduction of Niche price and product offerings in Internet products:A niche product can be defined marketplaces promote price competition as product that is made and marketed for among sellers. TheInternet thus significantly use in a small and specialized but profitable affects competition, and intensive price market that counteracts the threat of product competition can eliminate sellers’ profits. substitutes, new entrants into the market, To overcome these threats, companies have and competition among existing firms. By to employ appropriate pricing strategies for using the direct access to consumers enabled selling products over the Internet which are by the Internet, companies can collect mentioned below: information, identify target consumers, and •Price Discrimination Strategy: Price better introduce products or services to discrimination is a microeconomic pricing meet consumers’ needs. Companies can also strategy where identical or largely similar collect information on new products desired goods or services are transacted at different by small segments of the market. By creating prices by the same provider in different products that meet the needs of consumers markets. Sinha (2000) suggests two in the niche markets which focus on specific strategies for price discrimination: price product, companies can command higher lining and smart pricing. Price lining refers prices (Sinha 2000). to the practice of offering the same products Customer-centric strategy: Another or services at various price points to meet strategy associated with niche products or different customers’ needs. Smart pricing innovation is customer-centric strategy. refers to the practice of charging various prices Compared to a product-centric strategy, from market to market, depending on market which pushes products to consumers, conditions and differences in how customers customer-centric strategy pulls information value the product. Bakos and Brynjolfsson from consumers to improve and customize (1997) points that bundling can also be products(Viehland 2000). thought of as a type of price discrimination as Expansion into aRelated Product Line: An it reduces the heterogeneity of choices facing expansion into related product lines can also consumers and thus their willingness to pay be a good strategy. According to Porter (1987), for individual items. the expansion into related product lines can •Cost Leadership strategy: Cost leadership exploit transfer of skills or sharing of activities is a concept developed by Michael Porter and such as promotion and distribution, which will utilized in business strategy. It describes a lead to competitive advantage. Sharing can way to establish the competitive advantage. lower costs by achieving economies of scale Basically it means the lowest cost of operation and effectively utilizing company resources in the industry. Companies can also protect
IJBMR, 10(1), January - June, 2020 Page 33
INTERNATIONAL JOURNAL OF BUSINESS MANAGEMENT & RESEARCH- A Peer-Reviewed Bi-Annual Journal (ISSN: 2249-2143) profits by achieving cost leadership in a The place aspects of the marketing mix particular market or industry. If sellers are closely related to the distribution and cannot price discriminate, the lowest price delivery of products or services. The Internet sellers can charge as cost of production. As and its associated application software have competition intensifies, companies may have significantly changed the way company’s to lower their production costs to protect products or services are delivered by profits. reducing transaction and distribution costs. Promotion Strategy One way for companies to differentiate their To manage e-brands effectively and efficiently, products from rival companies is faster and companies have to employ promotion more efficient delivery of products to their strategies different from those used by customers. One of the sources of Dell’s initial traditional marketing. competitive advantage can be attributed Customer-Centric Promotion Strategy to its famous direct selling and build-to- (Customer RelationshipMarketing): The order approach. Just-in-time (JIT) strategy concept of relationship marketing was first allowed the company to operate with the coined by Leonard Berry in 1983 which lowest inventory level in the industry. Dell means attracting, maintaining and enhancing works on customer driven strategies by customer relationships within organizations. collaborating with customers to find ways to It allows companies to provide customers make technology work for them (Bakos 1998). with information about their products, Strategy related to faster and more efficient collect information about their customers, delivery is integration of online and offline and engage in data mining. They can then businesses (clicks-and-mortar strategy) customize products to meet customer needs which is discussed below: and offer promotions tailored to specific Clicks and Mortar Strategy (Biyalogorsky, customer groups. This process helps build a E., &Naik, P. 2003) base of loyal and profitable customers (Sealey Click and mortar is a type of business 2000). The Internet encourages companies model that includes both online and offline to employ this marketing based on direct, operations, which typically include a website personalized relationships with customers. and a physical store. A click-and-mortar As consumers become proficient at using company can offer customers the benefits of the Internet, they will only buy products that fast online transactions or traditional face-to- precisely match their needs. Thus, companies face service. It is an Integration of Online and must formulate customer-centric promotion Offline Businesses. strategies that respond to this new customer The Clicks and Mortar model enables power. companies to build up competitive advantages •Viral Marketing strategy: Viral Marketing because of the following aspects: is a technique that uses a company’s best Lower costs: By integrating virtual and customers to promote the product. Viral physical channels internal and external Marketing is a strategy that relies on word- efficiencies can be improved by saving labour of-mouth to carry a marketing message to and delivering costs. a rapidly-growing number of people. When Improved trust: Click-and-mortar firms can people share a message with others and the achieve a competitive advantage over Web- recipients share with more people, it can based stores regarding the trust of customers. cause a chain reaction which leads to an Because there is a physical location where exponential growth of communication. In customers have a direct contact person order to devise a successful viral marketing and a direct address where they can return campaign, an e-commerce company must products, they perceive less risk. know their audience, engage viewer emotions Differentiation through value-added and make content easy to share. services: Value-added services can be offered Place Strategy in terms of content integration, information Place strategy plays a fundamental role in integration as well as logistic integration the marketing mix of a product or service. without necessarily increasing costs.
IJBMR, 10(1), January - June, 2020 Page 34
INTERNATIONAL JOURNAL OF BUSINESS MANAGEMENT & RESEARCH- A Peer-Reviewed Bi-Annual Journal (ISSN: 2249-2143)
Content integration refers to pre-purchase Bakos, Y., &Brynjolfsson, E. (2001). services like offering information about the Aggregation and disaggregation of product. Integrated information systems information goods: Implications for bundling, allow customers to locate the nearest store site licensing, and micropayment systems. and check inventory. Logistic integration of In Lectures in E-Commerce (pp. 103-122). the channels allows the customer to choose Springer, Vienna. the channel through which he picks up and Biyalogorsky, E., &Naik, P. (2003). Clicks returns the product. and mortar: the effect of on-line activities on Geographic and Product Market Extension: off-line sales. Marketing Letters, 14(1), 21-32. The Clicks and Mortar approach enables Karagiannopoulos, G. D., Georgopoulos, N., companies to extend its market reach as &Nikolopoulos, K. (2005).Fathoming Porter’s well as its product across geographical five forces model in the internet era. Info, 7(6), boundaries. 66-76. Conclusion McCarthy, E.J., Basic Marketing: A Every business needs to survive and develop Managerial Approach, Homewood, IL: Richard appropriate strategies to implement them. D. Irwin, 1960. In the field of E-Commerce in developing the Perreault, Jr. W.D. and McCarthy, E.J. Basic current competitive climate requires more Marketing: A Global-Managerial Approach, appropriate marketing strategies to develop (13thEd.). Homewood, IL: Irwin, 199. and promote. McCarthy’s four marketing mix Porter, M (1979) “How Competitive Forces model and Porter’s five forces model and serve Shape Strategy,” Harvard Business Review. as a tool for making decisions for gaining Porter, M. Competitive Strategy, New York: competitive advantage by adopting marketing Free Press, 1980. strategies that are very useful in business. Porter, M. E. (1989). From competitive These models are studied to understand advantage to corporate strategy.In Readings the strategies which are likely to bring a in strategic management (pp. 234-255). competitive advantage to Internet companies. Palgrave, London. By understanding the impact of the Internet Porter, M(2001). “Strategy and the Internet,” on marketing mix and competitive forces, e- Harvard Business Review, March 2001, pp. business managers can adopt appropriate 62-78. strategies for meeting the unique challenges Sealey, P (1999). “How E-Commerce Will of e-business. The E-commerce industry Trump Brand Management,” Harvard will be faced with challenges as it matures Business Review, pp.171-176. but there is potential for growth owing to Sinha, I (2000). “Cost Transparency: The rising internet users and advancement in Net’s Real Threat to Prices and Brands,” technology. Companies will need to work Harvard Business Review. harder to provide better service to customer as Van Waterschoot, W., & Van den Bulte, C. more companies will be foraying in commerce (1992). The 4P classification of the marketing business in future. So there is need for E- mix revisited. The Journal of Marketing, 83- commerce industry to adopt good marketing 93. strategies in reaction to various competition www.google.com forces which are increasing with increased www.wikipidia.com number of players in E- Commerce industry. . References Allen, E., & Fjermestad, J. (2000). E- Commerce strategies: The manufacturer retailer consumer relationship. AMCIS 2000 Proceedings, 67. Bakos, Y. (1998). The emerging role of electronic marketplaces on the Internet. Communications of the ACM, 41(8), 35- 42.
IJBMR, 10(1), January - June, 2020 Page 35
INTERNATIONAL JOURNAL OF BUSINESS MANAGEMENT & RESEARCH- A Peer-Reviewed Bi-Annual Journal (ISSN: 2249-2143)
Role of Foreign Direct Investments (FDI) in Service Sector in India Parminder Kaur *Assistant Professor, Department of Commerce, S.U.S Govt. College, Sunam
Abstract Service Sector is the lifeline for economic growth of a country. Service sector has emerged as the most dynamic sector of Indian economy particularly from last one and a half decade and this sector is contributing significantly to GDP, employment and structural transformations. Foreign direct investment has been instrumental behind the growth of service sector in India. The present paper focuses on the financial year-wise analysis of FDI equity inflows and to know the sectors attracting highest FDI equity inflows in India over the period of 2004-05 to 2014-15. The secondary data has been used for study. The analysis has revealed that service sector attracts the highest amount of FDI inflows into India. DDTA (Double taxation avoidance agreement) between India and Mauritius helps in obtaining maximum FDI via Mauritius.
Keywords: Foreign Direct Investment, Service Sector, India Introduction increasing significantly from Only US $ 97 India is a vast country and many sectors million in 1990-91 to more than 60.1 billion contribute to the country’s GDP. Indian in 2016-17. India has emerged as one of the Economy is classified into three sectors: leading FDI destinations among developing Primary, Secondary and Service Sector. The countries.Despite significant procedural primary sector is an economic description relaxations and liberal policies, FDI inflows concerned with the extraction of raw material. in India, though much higher than the past, It includes farming, fisheries, forestry and has not been able to reach the levels of the animal husbandry etc. Secondary sector ASEAN economies or China. FDI growth in includes manufacturing industries. In service important sector like services over all foreign sector all types of services are included. They inflow into the country increased 22% to $ include trade, hotel & restaurants, transport, 35.81 billion during year 2014-15. There storage, communication, health care, has been a significant growth in FDI inflows education etc. The reason for growth of service in 2013-14 and 2014-15 (April-October) in sector is due to increase in urbanization, general and in Services Sector in particular. privatization and more demand for In 2014-15 FDI inflows to service sector grew intermediate and final consumer services. The by a shopping 70.4 percent to 16.4 billion contribution of service sector has increased US $. The rising trend is continuing in the with pace because foreign investors have first seven months of 2014-2015 with the FDI shown interest in investing into the country. equity inflows in the services sector growing This because India has a large pool of highly by 74.7% to dollar 14.8 billion. It helps skilled, low cost and educated workers in to establish new companies. All of these the country. This shows a positive change in contribute to economic growth of the country. share of service sector in India’s GDP. Foreign Literature Review Direct Investment (FDI) means investment by Ahmad (2015) analyzes not only the impact non-resident entity/person resident outside of foreign direct investment on gross domestic India in the capital of the Indian company product but also to analyze trend of foreign under Schedule 1 of FEMA Regulations 2000. direct investment in India since liberalization. FDI inflows into core sectors are assumed Further he concludes that it is the need of to play a vital role as a source of capital, hour to adopt imperative and innovative management, and technology in countries policies and good corporate government of transition economies. It is a high level practices at par with international standards, indicator of economic health of a country. The to attract more foreign direct investments. new policies have succeeded in enhancing Sood(2015) analyzed the contribution of foreign capital inflows in the Indian economy. FDI for GDP growth. The study concluded With the volume of FDI inflows into India that the association and dependence of GDP
IJBMR, 10(1), January - June, 2020 Page 36
INTERNATIONAL JOURNAL OF BUSINESS MANAGEMENT & RESEARCH- A Peer-Reviewed Bi-Annual Journal (ISSN: 2249-2143) on FDI in India is found to be statistically analyses that service sector is fastest growing significant whereas the relationship and sector in India, contributing significantly to dependence of investment by FII on total GDP, GDP growth, employment, trade and FDI in India is insignificant. Singh (2015) investment. Aggarwal, Singla and Aggarwal analyses contribution of service sector in (2012) exhibited the sector-wise & year-wise GDP, employment, FDI and Export services. analysis of FDI’s in India, and ranked the The paper found that the service sector faces sectors based upon highest FDI inflows. It has a number of problems such as infrastructure been found that Mauritius invested highest facilities to poor, cost of service delivers is in India followed by Singapore, Japan, and high and some more. Arya and Ashwani USA and so on. It was also shown that there (2014) examine the impact of government has been a tremendous increase in FDI inflow expenditure in social sector on economic in India during the year 2000 to 2011.Bohra growth at state level for 15 major states. (2011) analyzes FDI to developing countries in Impact of expenditure on social sector has the 1990s was the leading source of external no significant impact on growth. But it has financing and has become a key component an impact on human resource development of national development strategies for almost and indirectly participates in economic all the countries in the world. development. Akhtar(2013)found and stated Research Methodology in his study on Inflows of FDI in India as To achieve the objective of the study secondary Pre and Post Reform Period that during pre data on Indian economy for the period 2004- liberalization period FDI has increased at 05 to 2014-15 has been used. The data Compounded Annual Growth Rate of 19.05 is obtained from governmental and non- % and during post liberalization period it has governmental published and unpublished grown to 24.28 %.Kumari (2013) examines sources, various websites related to foreign the present and future status of FDI in India. direct investment, annual reports, various She has done her study in the period of 2000- bulletins of Reserve Bank of India, World 2012 and tried to examine the equity inflow Investment reports and Economic Survey, of FDI and FDI trend in India during these Government of India. years with the help of regression analysis Objectives of the Study and correlation tests. The FDI trend analysis The main objectives of the study are: result shows the upward trend of FDI inflow in 1. To know the trend of FDI inflow in India. India, which clearly shows that FDI is going to 2.To study the sectors attracting highest FDI flourish in the near future, thereby increasing equity inflows in India. the economic growth. Mukherjee (2012)
Table 1: Financial Year-Wise FDI Equity Inflows in India
Year Amount In Crores Amount In USD Million % Growth 2004-05 10,064 3,219 47% 2005-06 14,653 3,219 72% 2006-07 56,390 12,492 125% 2007-08 98,642 24,575 97% 2008-09 1,42,829 31,396 28% 2009-10 1,23,120 25,834 (-)18% 2010-11 97,320 21,383 (-)17% 2011-12 1,65,146 35,121 64% 2012-13 1,21,907 22,424 (-)36% 2013-14 1,47,518 24299 8% 2014-15 1,89,107 30931 27% Source: As per DIPP’s FDI data base
IJBMR, 10(1), January - June, 2020 Page 37
INTERNATIONAL JOURNAL OF BUSINESS MANAGEMENT & RESEARCH- A Peer-Reviewed Bi-Annual Journal (ISSN: 2249-2143) Analysis and Interpretations decreased to US$ 2187.71 million in 2003- FDI is an investment made by an entity 04. FDI inflows increases rapidly in year in one country in an Industrial / business 2006-07 i.e. US$ 1249.77 million in this year. activity in another country. FDI becomes The reason behind this fast growth is change more vibrant in India after the introduction in policies regarding to retailing in India as of new economic policy 1991. After liberal Government gives approval for 100% for cash policies regarding Foreign Direct Investments and wholesale trading and 51% for single in 1991, the amount of FDI received by India branch retailing. In year 2009-10 and 2010- increased sharply. India attracts many Multi- 11 it started to dip by 18% and 19%. Again national enterprises due to lower labour costs FDI inflows started to gain its momentum and high economic growth. and foreign direct investment have been on To achieve the objectives of this study rise in India. There was a growth of total FDI an analysis on the basis of collected data is equity inflow of 27.29% during 2014-15 over done. The result on the basis of secondary 2013-14 in India. data are as follows: It shows that Mauritius and Singapore on From Table 1 it is analysed that total FDI the top among the chart of 10 top investing equity inflow in India from different sectors countries into India followed by USA, Cyprus during the year 2000-01 was US$ 2378.68 and Japan. millions. It increases to 2704.34 million but
Table 2: Foreign Direct Investment flow to India: Country wise
Source Country 2010-11 2011-12 2012-13 2013-14 2014-15 Total FDI 14,939 23,473 18,286 16,054 24,748
Mauritius 5,616 8,142 8,059 3,695 5,878 Singapore 1,540 3,306 1,605 4,415 5,137
U.S.A. 1,071 994 478 617 1,981 Cyprus 571 1,568 415 546 737 Japan 1,256 2,089 1,340 1,795 2,019
Netherlands 1,417 1,289 1,700 1,157 2,154 UK 538 2,760 1,022 111 1,891
Germany 163 368 467 650 942 UAE 188 346 173 239 327 France 486 589 547 229 347
Switzerland 133 211 268 356 292 Hongkong 209 262 66 85 325
Spain 183 251 348 181 401 China 2 73 148 121 505
Malaysia 40 18 238 113 209 South Korea 136 226 224 189 138 Luxembourg 248 89 34 539 204
Others 1,142 892 1,154 1,015 1,250 Source: www.rbi.org.in According to Table III, Service sector attracts Conclusion the highest FDI inflows with 20% of the total FDI plays an important role in economic inflows followed by construction development development of India. It became possible 12%, Telecommunication 7% and computer due to the liberal policies and regulations software and hardware 6% respectively. regarding foreign direct investments through Government route and automatic route. IJBMR, 10(1), January - June, 2020 Page 38
INTERNATIONAL JOURNAL OF BUSINESS MANAGEMENT & RESEARCH- A Peer-Reviewed Bi-Annual Journal (ISSN: 2249-2143)
Table 3 : Sectors Attracting Highest FDI Equity Inflows in India
Ranks Sector 2010-11 2011-12 2012-13 Cumalative %age of (April- (April- (April- inflows total in- March) March) March) flows (in terms of US $ 1. Service Sector 15,504 15,236 25,367 1,71,345 20% (3,296) (5,216) (4,660) (37,063) 2. Construction Development : 7,590 15,236 6,562 1,00,363 12% Townships, Housing, Built- (1,663) (3,141) (1,206) (21,954) ing-Up Infrastructure 3. Telecommunications (Radio 7,542 9,102 507 57,585 7% Paging, Cellular Mobile, Ba- (1,665) (1,997) (93) (12,645) sic Telephone Services) 4. Computer Software & Hard- 3,551 3,804 2,382 52,500 6% ware (780) (796) (435) (11,640) 5. Drugs & Pharmaceuticals 961 14,605 5,389 48,257 5% (209) (3,232) (1,008) (10,202) 6. Chemicals (Other than fer- 10,612 18,422 1,466 40,366 5% tilizers) (2,354) (4,041) (268) (8,857) 7. Power 5,796 7,678 2,871 36,085 4% (1,272) (1,652) (526) (7,825) 8. Automobile Industry 5,864 4,347 4,916 35,702 4% (1,299) (923) (895) (7,653) 9. Metallurgical Industries 5,023 8,348 7,439 34,375 4% (1,098) (1,786) (1,385) (7,426) 10. Hotel & Tourism 1,405 4,754 17,401 32,884 4% (308) (993) (3,190) (6,526) As India is in double taxation avoidance Sood Naveen (2015). Trend of FDI in India: agreement (DDTA) with Mauritius, which An Analytical Study of 2001-14. International helps in attracting maximum FDI from Journal of Commerce and Management. Mauritius. India received maximum foreign 9(6):56-62. investments from Mauritius, Singapore Singh Kuldeep (2015). The significance of and Japan which shows a positive impact Service Sector in Indian Economy. on growth of GDP of India. It is also International Research Journal of Management analysed that the service sector receives the and Commerce. 2 (4) : 13-25. highest amount of FDI inflows followed by Latha M.C. and Dr.Shanmugan V. (2014). telecommunications sector and construction Growth of Service Sector in India. IOSR sector during 2011 to 2014. Investors are Journal of Humanities and Social Science. 19 taking keen interest in investing and showing (1): 8-12. their growing confidence in India Economy. Ashwani S and AryaGaurav. Does In order to attract more and more FDI inflows Government Spending on Social Sector in country policy makers need to ensure Impact Growth? An Analysis Across Indian transparency and consistency in making the States for Last Two Decades. International policies. Research Journal of Commerce, Art and References Science. 5 (6) : 211-225. Ahmad Izhar Mohammad Yameen (2015). AkhtarGulshan (2013). Impact of FDI: Pre & Impact of FDI on GDP in India since Post Reform. International Journal of Liberalization. Pezzottaile Journals. 4 (3) : Humanities and Social Science Inventions. 1827-1834. 2(2) : 1-11.
IJBMR, 10(1), January - June, 2020 Page 39 INTERNATIONAL JOURNAL OF BUSINESS MANAGEMENT & RESEARCH- A Peer-Reviewed Bi-Annual Journal (ISSN: 2249-2143)
KumariNilanjana (2013). A Study of FDI AggarwalShalini, SinglaAnkur and in India. Journal of Economics and AggarwalRitu (2012). FDI in India. Sustainable Development. 4(3): 25-40. International Journal of Code Engineering and MukhrejeeArpita (2013). The Service Sector Management. 15 (5) : 93- 105 in India. ADB Economic Working Paper series Bohra Singh Narendra (2011). FDI in Indian No. 352. Service Sector. International Journal of Economic Research. 2(2): 10-18.
IJBMR, 10(1), January - June, 2020 Page 40 INTERNATIONAL JOURNAL OF BUSINESS MANAGEMENT & RESEARCH- A Peer-Reviewed Bi-Annual Journal (ISSN: 2249-2143)
Consumer Behavior towards Green Products Neenu Sharma Assistant Professor, Department of Commerce, SDAM College, Dinanagar
“Consumers are faced with less choice in their ambition to ‘go green’”. This article basically deals with how people define green products in their own perceptions and what have contributed to the appearance of Green Market. Key Words: Green Purchase Behavior, Environmentally Conscious Consumers, Environmental Concern, Environmental Knowledge
Introduction Objectives Consumer behavior means to know the “what- The present study was undertaken with the where-why-when and how” of the purchase following objectives: intention of the consumers. Understanding • To understand the concept of green product. the consumer behaviour has never ever been • To know consumers’ buying intentions a simple task. Many a times consumers regarding green products. ‘say’something else but ‘do’something else. Green Consumers: They are not very much touched with their The green consumer is defined as one who inner motivations. Many a times they respond adopts environment friendly behaviours to influences that change their minds at the and who purchases green products over the last minute. standard alternatives. Green consumers are According to Walter and Paul, “Consumer more internally-controlled. They strongly behaviour is the process whereby individuals believe that an individual consumer can decide whether, what, when, where and be effective in protecting the environment how and from whom to purchase goods and and they feel that the job of environmental services.” Marketing research is primarily protection should not be left to the concerned with behaviour of the consumers. government, business, environmentalists If the behaviour of the consumer towards and scientists only; they as consumers can a particular company or its product is also play a significant role in protecting the unfavourable, the Company will not be able environment. to sustain itself for too long. It is therefore in Green Product the interest of the company to ensure that Green products as such have no established people have a favourable inclination towards definition till date In simple words these are its products. the products that are manufactured to give Environment Concern due consideration to the life cycle. The life The concern for climate change and global cycle analysis of a product provides estimates warming is increasing. Environmental of the positive and negative environmental pollution is one of the most challenging impacts of the product from cradle to grave problems facing humanity and other forms i.e. from the extraction of raw materials, of life. Today, environmental concern and processing, packaging, transportation, use knowledge is on the rising scale. Many laws and disposal or end of life. have been formed. Even then our land and forest Consumer Preference for Green Product cover is decreasing, fresh water resources The dependent variable in this study is the are being polluted, watertable is declining factor affecting consumer preferences for and air pollution is increasing. Consumer’s green products. Everyone on this Earth, plays concern about the environment has been a vital role as a consumer. Consumers are the on the rise all over the world. However, the main factors that boost a country’s economy. understanding of the term ‘Greenness’ varies Each consumer has his very own perspective widely among the consumers. Manufacturers and preferences towards his consumption. make various claims about greenness of their Consumer from demographic factors such product but there is little the consumer can as background and society may influence do to authenticate such claims. the behaviour in making decisions while
IJBMR, 10(1), January - June, 2020 Page 41
INTERNATIONAL JOURNAL OF BUSINESS MANAGEMENT & RESEARCH- A Peer-Reviewed Bi- Annual Journal (ISSN: 2249-2143) purchasing products. Thus, it undeniable norms are important motivators of ecologically stated that consumers’ preferences and their responsible behaviour. The strength of the perspective towards goods and services are normative influence of the consumers’ family hard to predict. Their preference for the green and social groups on purchasing decisions products depends upon the following factors: depends on the characteristics of the product Knowledge and Attitude towards e.g. luxury rather than a necessity. Environment and Green Product Advantages of Green Products in Market There is a general belief among the For companies, a green business model can researchers and the environmental activists transform the way companies are being run. that by purchasing environmentally friendly Thus by combining an eco-conscious outlook products or green products, products with a with good safety practices, businesses can recyclable packaging, consumers indirectly enjoy a wealth of benefits. Green business will can contribute significantly in order to improve also help in cutting down the costs which is the quality of the environment. The quality due to unnecessary waste associated with it. of the environment depends on the level of Apart from this, introducing a green business knowledge, attitudes, values and practices of will not only aid the company in cutting down consumer. Attitudes are the most consistent their costs but also help in providing their clarifying factor in predicting consumers’ employees with a safe and healthy workplace. willingness to pay for green products This Therefore, developing a green business can means, price is not the main cause to avert help companies to operate more sustainably, consumers from purchasing green products. safely and efficiently. The other advantage Influencing consumer behaviour is a complex of green products in market is that it can and difficult task requiring knowledge of its become a powerful competitive weapon in the determinants. The most convincing support market. It has opened up a new market for of the growing influence of the ecologically- green products. Thus the companies should friendly consumer is the increase in the be ethical and have a social responsibility number of individuals that are willing to pay towards to the environment while introducing more for environmentally friendly products green products to the market. Social Norms and Values According to the articles that have been Studies have also investigated that the reviewed, the factors that determine interest in green initiatives is not expected the consumer willingness to buy green to emanate only from external impositions products are their consciousness about and inducements but also from the internal the environment and their health. People sense of responsibility of a firm towards the are more willing to pay for green products society in which it exists. The sensitivity of especially in metropolitan cities. Other than the people towards the environment can be that, consumers are more willing to purchase intensified by creating awareness towards green products because green products have environmental problems such as global less harmful effects on the environment warming and pollution. Such problems at and human health Therefore, it could be world level will force firms to behave in a said that consumers are willing to buy green more socially responsible manner and reflect products because they are “green” and eco- an image of due diligence and commitment to friendly. However, there might be some sustainability. Green purchasing is primarily consumers who may not prefer to purchase motivated by degree of consumer ecological green products for various reasons such as consciousness. package size, unit bias, and size labels. Due Social norms influence individuals to take to this, it shows that product preferences into consideration the opinions of the other plays an important role in determining members of society when choosing a green consumer’s intention of purchasing a green product over another: if they think that the product. In addition, other reasons that people in their circle are approving green influence consumers to be less willing to buy products over standard products, there are green products are because consumers may induced to buy green products. Thus social consider green products to be less effective
IJBMR, 10(1), January - June, 2020 Page 42
INTERNATIONAL JOURNAL OF BUSINESS MANAGEMENT & RESEARCH- A Peer-Reviewed Bi-Annual Journal (ISSN: 2249-2143) than conventional products. It could be said products rather than green products. This is that consumers are not willing to buy green because even though they have paid a higher products because they are not so sure about price for green products but they cannot get the quality standards of the green products an equal or an even better satisfaction from as compared to conventional products. Other the products. reason is that consumers sometimes may As a conclusion, all the aspects that have also think that green products are more been discussed in this review are important costly as compared to conventional products. because all of the aspects are correlated. These product preferences are actually the One may affect the others and viceversa. reasons that consumers are unwilling to Therefore, to start a new business in a new purchase green products. Moreover, it is not market, marketers may have to take wider just the product preferences but consumers consideration before carrying out the actual behaviors and perceptions that contribute to moves. the reasons for why consumers decide not to References buy green products. Ankit, G., & Mayur, R. (2013). Green The People who are willing to pay more marketing: Impact of green advertising on for green products are the ones who have consumer purchase intention. Advances in realized that the environmental issues are Management, 6(9), 14-17. becoming worst. Due to this, it has developed Actual vs. perceived corporate social into an opportunity for sellers to make responsibility scores. (2008). Business & the profits by introducing green business. While Environment with ISO 14000 Updates, 19(12), introducing a new business, they must fulfill 8-8. their social responsibility barriers to adoption Ajzen, I & Fishbein, M. (1980), Understanding of Green Products to the environment. Attitudes and Predicting Social Behavior. Conclusion Prentice-Hall,Inc., Englewood Cliffs,New Basically, this article is about how Jersey. people define green products in their own David L Loudon & Albert J Della Bitta perceptions and what has contributed to the (2006), TMGH, 4th. Edition, 2006.,Consumer appearance of green market. It shows that Behaviour. people have different description towards Zaltman G and Wallendorf M, John Wiley & green products with regards of their own Sons, 1983,Consumer Behaviour : Basic perceptions. Therefore, it could be said Findings and Management Implications. that a clear understanding for the purpose J Paul Peter, Jerry C Olson Peter, J Paul, of green products and green market are Olson, C Jerry (1990), Consumer Behaviour equally important. It is because it helps to & Marketing Strategy, 2nd. Edition. avoid the problems of targeting the wrong James F Engel, Roger D Blackwell & Paul W market and purchasing fake green products. Miniard, 8th. Edition, 1995. Consumer It is important to have a good knowledge Behaviour, the Dryden Press.John A Howard towards the products producers are 1989,Consumer Behaviour in Marketing selling. Furthermore, there is a correlation Strategy, , Prentice Hall. Leon G. Schiffman & between product preferences, consumers Leslie Lazar Kanuk, PHI –EEE, 9th. Edition, behaviours and advertisements credibility. 2006. Consumer Behaviour. As the credibility of the advertisements is trustworthy and true, consumers will perceive it as a believable message and thus buying the product solely based on the advertisements message. Other than that, product preference is also one of the main factors that may influence consumer’s consumption. If green products quality are low and with a higher price compared to conventional products, consumers may consider buying conventional
IJBMR, 10(1), January - June, 2020 Page 43
An Official Publication
Faculty of Buisness Management, Commerce & Economics Desh Bhagat University Mandi Gobindgarh
All rights reserved @ 2020, Desh Bhagat University