APJRBM Volume 2, Issue 1 (JANUARY 2011) ISSN 2229-4104 Sri Krishna International Research & Educational Consortium http://www.skirec.com -178- STATUS OF CORPORATE SOCIAL RESPONSIBILITY: IN INDIAN CONTEXT MRS PARUL KHANNA MRS GITIKA GUPTA Lecturer Rayat- Bahra Institute of Management, Hoshiarpur Introduction In the last twenty years, there has been a sea change in the nature of the triangular relationship between companies, the state and the society. No longer can firms continue to act as independent entities regardless of the interest of the general public. The evolution of the relationship between companies and society has been one of slow transformation from a philanthropic coexistence to one where the mutual interest of all the stakeholders is gaining paramount importance. Companies are beginning to realise the fact that in order to gain strategic initiative and to ensure continued existence, business practises may have to be moulded from the normal practise of solely focussing on profits to factor in public goodwill and responsible business etiquettes(Reynard and Forstater, 2002). An examination of some of the factors which have led to the development of the concept of corporate social responsibility (CSR) would be ideal starting ground for the conceptual development of suitable corporate business practises for emerging markets. The business environment has undergone vast changes in the recent years in terms of both the nature of competition and the wave of globalization that has been sweeping across markets. Companies are expanding their boundaries from the country of their origin to the evolving markets in the developing countries which have been sometimes referred to as emerging markets. The current trend of globalization has brought a realisation among the firms that in order to compete effectively in a competitive environment; they need clearly defined business practises with a sound focus on the public interest in the markets (Gray, 2001). The increase in competition among the multinational companies to gain first mover advantage in various developing countries by establishing goodwill relationships with both the state and the civil society is ample testimony to this transformation. Secondly, in most of the emerging markets, the state still holds the key to business success because of the existence of trade and business regulations restricting the freedom of multinational companies to incorporate their previously successful business doctrines which have been tried and tested in the developed nations. The state with its duty of protecting the interests of the general public would naturally be inclined to give preference to companies which take care of the interests of all the stakeholders. Thirdly, emerging markets have been identified as a source of immense talent with the rising levels of education. For example, the expertise of India in churning out software professionals and China in manufacturing has now become internationally renowned. In order to draw from this vast talent pool coming up in developing countries, companies need to gain a foothold in these markets by establishing sound business practices addressing social and cultural concerns of