Public Policy and Administration Research www.iiste.org ISSN 2224-5731(Paper) ISSN 2225-0972(Online) Vol.5, No.3, 2015 5 Development and Testing of Corporate Social Responsibility (CSR) Index for Pakistan Gulfam Khan Khalid (Corresponding Author) Management Sciences Mohammad Ali Jinnah University (M.A.J.U) Dr. Zafar Mueen Nasir Business Studies, Institution: Pakistan Institute of Development Economics (PIDE) Abstract In this paper the Corporate Life Sustainability Theory and Index has developed on the basis of literature review and reported the Index in five selected industries of Pakistan through quantitative and qualitative methods with counter in-depth interviews. In light of results the ranking of Industries have qualified in assignment of rank and the values of dimensions have changed with respect to industrial scope of dimension. In depiction of literature review and construct the expression of Corporate Life Sustainability Theory has developed with introduction and description of concept of Intentional Constant. The conclusive Industrial Level and Degree has developed to report and rank at the organizational level, further the concept and derivation of Industrial Constant and Transition Period has introduced and described. Keywords: Corporate Social Responsibility (CSR), Corporate Life Sustainability (CLS), Environment, Humane, Intentional Constant, Industrial Constant (IC) Introduction The earliest definition of CSR is given by H.R. Bowen (1953) which states it as the responsibility of businessmen to follow those politics, to make those judgments, or follow those lines of action which are appropriate in terms of the objectives and beliefs of our society (Carroll 1999, p.269). In Pakistan concept of CSR has been evolving and every organization has its own understanding about CSR. As Ali Habib, head of corporate affairs, Standard Chartered Bank (SCB) has defined CSR as “Commonly the banking industry and specifically Standard Chartered Bank (SCB) has a long term vision of results of its economic, governance and social after-effects and environmental actions. We don’t use the term CSR which tells how ethically we run our business because it is not a broad enough term to include all these four factors. Instead we believe on ‘sustainability’ or building a sustainable business showing a long term approach” (Mandviwalla, 2009), whereas internationally, CSR speaks beyond sustainability. Similarly Adeel Hashmi, communications manager Nokia, Pakistan, Iran and Afghanistan during his interview with Synergyzer depicted CSR as “For us, CSR concerns with the management of all company procedures for the overall optimistic impact on society, as a good business and a prosperous society are sophisticatedly linked.” Sadia Khurram, director marketing operations and CSR, Mobilink GSM viewed that Mobilink believes CSR is a continuous commitment by our company to contribute to economic progress, while raising the living standards of our labor force, their families, the community and society at large (Mandviwalla, 2009). In order to increase the accountability and social responsibility of a corporation, a CSR index is necessary, which is not available till now in developing countries like Pakistan. In such countries, it is the responsibility of the government to guarantee the social responsibility discharge and accountability of the corporation. According to Samuels (1990), governments of developing countries need to have a strict regulatory mechanism to ensure greater accountability. Moreover, his proponent Momin (2006) also suggested that a home country government should, by law, ensure the responsibility of multi-national corporations (MNCs) for the operation and social and environmental reporting of their subsidiaries, to the home country. Momin also added that the real need is to restructure the legislative structure to make CSR mandatory, and pass initiatives for political and social development in favor of CSR or developing an accountability mechanism, which would benefit all members of the society. United Nations (UN) and European Union (EU) are working hard to standardize definition of CSR, its dimensions, guidelines, standards, policies & procedures. Moreover international bodies (as mentioned methodology) have defined standards and policies to measure different aspects of CSR. In developed countries governments have started interfering and companies have started reporting on CSR. In addition of this, lot of work has been done to devise recommendations to bound corporations to design CSR policies. But unluckily little work has been done in this field in developing and underdeveloped countries especially in Pakistan. In Pakistan, there are numerous obstacles in achieving CSR, where the institutions, standards and appeals system, which more than often give life to CSR are relatively weak. The first code of Corporate Governance (CG) in Pakistan is promulgated in March 2002 by the SECP, which is the apex regulator of corporate sector in country. Since then no further development has been taken place at government end till the introduction of ‘Voluntary