Global Organisations and SME in India: A Comparative Study of Sustainability Initiatives

Sustainability has become a mandatory strategy for survival on the planet. Sustainable development is an imperative for survival and growth for nations, peoples and the organisations. The study embraces the sustainability initiatives of Global and Small/Medium enterprises (SME) working in India. Data was collected for the study using a questionnaire. Mid-senior level executives were contacted for their take on sustainability initiatives by their organisations in India. The responses were collected both from globally operating organisations and SME in India. The summarised data was analysed to arrive at the conclusions. The study indicates that global organisations are operating at global scale in corporate sustainability programs for competitive advantage, to mitigate risk, for building a brand, and to regulate the complexity of global supply chains for business growth to ensure an enhanced market share/customer growth. The SMEs in India are found at a nascent stage with respect to sustainability and are only involved in activities necessary for their survival. Incorporating sustainability initiatives in the business practices of SME will need awareness and policy frame. On the other hand, the global organisations have a long way to go to create appreciable impact on the planet via their sustainability efforts. However, changes of responsible product, processes and global supply chain designs are being incorporated in their culture. These initiatives will need further push through governance and policy announcements at a regional and country level for far reaching impact. And for emerging countries like India they can be leaders in sustainability efforts for other Indian organisations particularly SME to follow sustainability based practices.


Introduction
Climate changes have raised a need for Sustainable development.Most countries, organisations, peoples are working to achieve a solution.This was also reported two decades back in Brundtland Commission Report (WCED, 1987) and by Gibson B.R (2001) that "Continuing environmental degradation was leading not only to local and regional resource depletion and damage to essential ecological functions, but also it is leading to cumulative global effects".Sathaye et al (2006) have outlined that in developing countries usually the Sustainable development discussions lie on economic trade-off between economic development and the conservation of environment.But evidences and growing problems are proving the degradation of natural resources like soil, forests; biodiversity etc is getting aggravated and will enhance more by climate change.
The sentiment is clearly understood as recently countries worldwide made efforts on curbing emissions.A plethora of other steps were suggested to reverse the climate change a COP-21 meet in Paris.(COP-21, 2015).There were pledges and concrete action plans both by the developing and the developed countries.
A decade back, sustainability efforts had the focus only on curbing environmental emissions/standards along with specific degradation concepts.In recent time the business complexity is increasing which makes it imperative for organizations to adopt new environmentally and socially conscious approaches to enhance profitability and reduce risks (Agnihotri & Tripathi, 2015).Authors claim that inclusion of sustainability initiatives has been gradual and is fuelled by fiscal disorder and turmoil in the economies.Researchers also argue that corporate organisations especially global organisations with big brand values are working to implement policies, processes and procedures in their organisations as a way to stabilise and improve their supply chain and product quality.This is helping the organisations ultimately to minimise financial risks and capture more business value.It is culminating in achieving their ultimate financial and economic goals (Dauvergne & Liste, 2012).
The SME or small/medium enterprises which are significant to India's economy due to massive contribution to local income growth, job generation, market innovation .They are ostensibly oriented with the imperatives of globalisation, market strategies, innovation etc.The Indian policies do not match to help the organisations since the reforms that happened in early 1990s (Das 2008).Rupa (2013) argues that this is particularly due to the inherent problems present in small/medium enterprises in India.The sector is unorganised with little bargaining power and access to different markets.Tough financial conditions and lack of economic and market prowess make their survival difficult.Hence the sector needs bolstering from government policies.Sustainability could be a way forward for society and organisations/enterprises wholesome development.
MIT Sloan Management Review (Kiron et al., 2013) argues the same facet that "economic downturn accelerated greater shift towards corporate focus on sustainability issues particularly those which have impact on bottom-line profits of an organization".Sustainability is helping the organisations with improved bottom lines, cost saving, and branding as a responsible business organisation.Today's Global brand business organisations understand that their sustained success depends upon the economic, social and ecological contexts in which they operate.They have to find ways to be more meaningful and these contexts can no longer be taken for granted.People want to see the efficient use of available resources as an economic imperative and there has been tremendous work to understand what that means for individual business (Reinhardt, 2015) The physical environment is becoming more unpredictable.More interconnected global economy is altering social conditions, and technological innovation is transforming the nature of consumption and production (Kiron et al., 2015) Hence, the greatest drivers of corporate sustainability programs had been the stakeholders involved.And businesses too are taking a note with enhanced government regulation, consumer and employee interest.(Kiron et al. 2013).Global organisations need to prune their bottom lines for risk management and hence the policies for sustainable or holistic development.In line with this, small/medium enterprises need sustainability to match the quality and competitiveness of global giants.
While industry represents single biggest threat to society and the natural world, it can also represent one of our greatest allies in our mission to safeguard it and provide for its sustainable development.Marsden (2000) insisted in conclusion at the world wide fund for nature's international conference.Today, a company's profits are tied to the prosperity of its consumers, customers, employees, communities and society.More than ever before, profitability and sustainability are synonymous.(Indira Nooyi, Sustainability reporting 2014).

Literature Review
Sustainable development may not be at the forefront of businesses but the issues are lingering with respect to it.Sustainability as a concept also has issues as its complex and still there is no settled evaluation or methodology to adopt sustainability in processes or policies of an organisation (Lee 2006).However, still Munoz et al (2008) based on their research point out that even if there are no settled policies/processes with respect to Sustainability but organisations are committed to their stakeholders and hence through sustainability want to enhance their social and financial performance, which is key to long term growth of an organisation.
Along with the need to be more responsible, the impending Climate change is coming at the forefront for many policy/processes changes or improvement.According to Ernst and Young (2013) report, there are six growing trends in corporate sustainability.Organisations may not talk about climate change directly or employ the business practices with respect to climate change.All are being buffeted by its effects and issues including deforestation and shrinking bio-diversity that are affecting the availability of agricultural products.And thus, risk management for global supply chains is making sustainability an important part of corporate agenda.Organisations as envisaged by Yilmaz & Flouris (2010) also use sustainability as a risk management strategy to reduce the potential losses and to explore new business opportunities.New technologies are being worked upon, along with redesigning or products/processes to build sustainable communities.Authors Yilmaz & Flouris (2010) also through their research work elaborately define that since past decades Corporate Sustainability has been the interest of risk managers.Though it's a complex concept but is being defined through environment, economic and social context for business management through economic prosperity, social equity and ecological conservation.Sustainability as a risk management strategy can help organisations to expand globally and still remain relevant for local operations through working with three facets of sustainability and hence improvement in processes/products and external stakeholder management (Yilmaz & Flouris, 2010) Various research works also reiterate the fact that global organisations which have presence in multiple locations, have policy implementations at regional level are involved in Sustainability based practices.MIT Sloan Management review (Kiron et al. 2013) elaborate in their report that nearly two-thirds of respondents rate social and environmental issues, such as pollution or employees health, as "significant" or "very significant" among their sustainability concerns.Yet only about 40% report that their organizations are largely addressing them.Even worse, only 10% say their companies fully tackle these issues.Interestingly, MIT Sloan Management Review (Kiron et al., 2013) further state that companies that perceive sustainability issues as significant, thoroughly address them and share distinct characteristics.For example, Kiron et al. (2013) claim that, • Organisations which perceive Sustainability important, 90% have developed a sustainability strategy, compared to 62% among all respondents.
• These organisations top management give lots of importance to Sustainability and 70% of respondents placed sustainability as one of their important strategy agenda, compared to an average of 39%.
• 69% of Organisations have Sustainability agenda have developed their sustainability business case, compared to only 37% of all respondents The Ceres roadmap (Ceres, 2014) for Sustainability report also stresses that Global organisations or organisations with presence across multiple locations are leading with their efforts.The report particularly highlights that organisations have substantially accelerated and broadened their sustainability efforts.Global organisations are embracing sustainability efforts to create long term shareholder value.According to the report: • More Global organisations are showing evidence that top management is having an oversight of sustainability issues, with 54% performing or conforming to the expectations.
• Globally, the Food and Beverage sector showed marked improvement in their efforts to engage with stakeholders than other sectors.
• The report also stresses on the fact that "The Food and Beverage sector is the leader across the Ceres Roadmap's disclosure expectations, showing particularly strong use of a variety of communication vehicles to convey sustainability progress, including those aimed at investors".
• The important finding of the report being that the leading beverage organisations are engaging their employees to connect sustainability goals to broader business goals.The Food and Beverage sector is beginning to seize this opportunity and the report clearly illustrate that nearly 60 per cent of companies are actively engaging their employees on sustainability issues.(Ceres, 2014) Authors (Lopez et al., 2007) argue in their work that for creation of long term value sustainability has an effect.This is established by various sustainability based indexes to cater to financial performance of an organisation.Authors concluded that for firms initially the sustainability initiatives may be economically very viable but in long term it creates and delivers value and is not seen to have any repercussions on performance indicators (Lopez et al., 2007).
In India SME sector is involved with sustainability only in the capacity of business partners or as a part of supply chain.Mohanty & Prakash (2013) elaborate through their research that small/medium enterprises have been involved in green supply chain practices only to the extent of their participation as suppliers, distributors and in other capacities as business partners.Small/medium enterprises face external pressure when they are part of global supply chain and resort to practices only as a part business partner/supplier (Desouza & Awazu, 2006) As the Ceres roadmap (Ceres, 2014) stresses though the awareness and intent for sustainable way of development has increased among organisations yet the efforts need more pace and number of companies have to start the journey towards sustainable development.
Leading global organisations with presence across multiple locations are working on the goal of delivering superb financial performance with greater sustainable growth and shareholder value.Organisations are working through business practices for sustainable communities to reduce environmental and carbon footprint, along with an inclusive work environment for associates and partners.There are efforts on minimizing the impacts on environment through energy; water conversation as well reduced use of packaging material (PepsiCo 2014, Ceres 2014).Some of the global organisations are becoming more responsible and are adopting newer approaches for resource conservation and are adopting business practices to reduce their human, environmental and social impacts.
Global organisations are also making public their initiatives, actions and plans for sustainability using GRI guidelines to ensure transparency .This action by Indian SME sector or small/medium enterprises is dismissal.Reports highlight that in India disclosures on sustainability or Sustainability reporting is very less (Majuamdar et al., 2015).And the organisations which are disclosing information are having lesser externally certified (less than 25%) reports and 41% reports in India do not have carbon disclosures.(Majuamdar et al, 2015 andDesouza &Awazu, 2006).

Sustainable Business Practices and Indian Organisations
Indian Organisations have started making efforts on sustainability and is visible through their plethora of initiatives as envisaged in the annual report "India's top companies for CSR and Sustainability-2015". Majuamdar et al 2015 have listed that mainly organisations which are globally interconnected and has presence across diverse portfolios is working through and with initiatives to reduce their emissions, have innovative strategies for resource utilisation, product and Consumer responsibility and transparency.Authors of the report reveal that Indian Manufacturing organisations are spending more through mandatory CSR proceeds on the local communities.Large manufacturing sectors are spending more than service sectors and with a greater thrust to "Make in India" concept, business responsibility is increasing.Still the report mandates that Indian Organisations are more involved with activities in their CSR spend though Sustainability efforts are increasing each year.Also the authors highlight the disclosure practices of Indian organisations.Indian Organisations are having lesser externally certified (less than 25%) reports and 41% reports in India do not have carbon disclosures.(Majuamdar et al 2015).
Researchers (Kaur et al., 2015) also highlight that organizations in India are resorting to sustainability based initiatives due to greater government regulation for CSR spends and environmental regulation.India is committed to reduce its carbon emission by 33% to 35% by 2030 (Plucinska, 2015).And Indian Manufacturing organisations primarily are focusing on sustainability based reporting using GRI guidelines.In Indian private organizations the focus is more on environment and social factors than economic factors to become sustainable or to follow sustainable development.Indian organisation have long way to become sustainable.Now with COP-21 agreement and our commitment to reduce the emissions, there has to be more work on this front.Authors (Kaur et al., 2015) also point out that organizations need sustainability measures economic, environment and social factors to transform organizational culture which will in turn lead to increased innovation, enhanced brand values, more internal efficiencies and more customer, stakeholder loyalty.Hence, being sustainable is not just a climate perspective but a business prerogative as well.
Nevertheless, Majuamdar et al 2015 conclude in their report that the sustainability efforts of organisations are enhancing.In India, mostly organisations are resorting to sustainable business practices in product/services and internal operations.Majuamdar et al 2015 point out that as compared to sustainability efforts organisations are more prudent on their CSR spends to develop communities and employees.And this is particularly due to Companies Act 2013 which mandates the CSR spends to be 2% of organisations profit.
The Companies Act 2013 demands that the organisations to put 2% of their profits in Corporate Social responsibility acts.Majuamdar et al 2015 claim that with this the organisations have a certain point upto which they have to spend and thus it helps in CSR spend decision making.But Sustainability lacks such policy and government framework and thus cannot be curtailed through spends and can be only integrated through business practices which are adopted by organisations.
• Make in India will put focus on Sustainable supply chain and hence make a perfect sense for organisations to enhance their efforts for sustainability.
• Indian organisations are becoming global and sustainability is the only solution to manage risks and create a reputation via a brand This is further elaborated by Dauvergne & Lister (2012) that lists that branded/global organisations are resorting to sustainability for more control over their global supply chain and it's an essential need to manage risks and for acceptance through local community innovation for the likes of global organisations, such as Coke, IBM, Dell, General Motors etc .
In India the global branded MNCs are leading the path for adoption of sustainability business practices.Authors assert that the Global organisations are adopting more of Sustainability programs as cost considerations which make it imperative for production to happen in emerging economies like India and with sustainability initiatives they can remain relevant to the supply chain in the country along with manage and mitigate their business costs ( Dauvergne & Lister, 2012 ) So the question arises that have the global organisations or big branded organisations have become sustainable.Not necessarily, Dauvergne & Lister (2012) point out that what they are achieving is mere a measurable incremental advances in corporate sustainability.These gains however are concrete efforts to reduce carbon footprint, better resource utilisation and at the same time to become responsible with respect to human factors.
And thus this is a road map for Indian SME enterprises and other organisations to spruce up their efforts to reverse and mitigate risk, build brand and enhance the profitability by being more conscious and responsible whilst adapting sustainable business practices in their organisations.Dauvergne & Lister (2012) point out that in Global organisations sustainability efforts alone will not resolve the eco-pressures from a growth-dependent world economy.Effective global environmental governance will ultimately involve a shared governance approach with strong regulation and sustained advocacy to go beyond the important but ultimately incremental big brand market improvements.(Dauvergne & Lister 2012).And with draft of COP-21 ready and India having a huge case to curb emission and develop at a faster rate, Sustainability is the way for private, public and government Indian Organisations.And if like CSR law of 2% profits spend, the sustainable efforts are also gauged with policy and law framework, it will surely help organisations to become sustainable.

Research Methodology & Data Collection
The research study aimed to understand the Sustainability efforts of organisations operating at global level and for SME in India.Global Organisations chosen for the study had their operations in many countries around the world and medium/small enterprises had local operations at various locations in India with revenues less than 10 million dollars (Desouza & Awazu, 2006) Researchers like (Agnihotri & Tripathi, 2015;Majuamdar et al., 2015) claim that in India disclosures are also increasing for Sustainability efforts amongst the organisations resorting to Sustainability practices.The Global Reporting Initiative (GRI, 2002) is a disclosure practice and is framework for Sustainability reporting utilised by organisations worldwide or typically Global organisations.Authors Hedberg and Malmborg (2003) further claim that organisations are disclosing information on sustainability to enhance their legitimacy and responsibility in the view of stakeholders.And thus disclosure practices GRI guidelines is getting more prominence on the lines of accepted national or international reporting standards.The GRI (GRI, 2002) uses a Sustainability framework which has three focus areas, namely social, economic, and environmental.Each Sustainability factor within GRI framework consists of categories, aspects, and indicators.The guideline clearly indicates the parameters to be used while resorting to Sustainability reporting for Organisations.(Labuschagne et al, 2007).
The GRI guidelines were used to frame a questionnaire on Likert scale.A quantitative survey approach for data collection was used.Survey is an attractive method of data collection, because of its potential to afford the researcher a large amount of information that can be analyzed to test relationships between two or more variables (Prentice & Miller, 1992).And survey is considered more important because of its ability to generate diverse and great amount of information for the purpose of study Kerlinger, 1986(cited in Yang, 2013).
A questionnaire was created (attached herewith in Appendix -1).Also, to achieve specific objective of the research paper the questionnaire had a specific question about sustainability efforts in an organisation on 5 point likert scale (Saraswat, A. & Tewari, R., 2015).
The questionnaire was administered to Executives at various levels to ascertain their views with respect to Sustainability in their organisations.81 responses were collected which were segregated into global and SME in India, so it was 40 for global organisations and 41 for SME in India.
The Questionnaire was pilot tested for reliability using Cronbach alpha (0.83).The organisations profile is depicted below,

Parameter
Global The responses collected were summarised and a hypothesis was framed to test the data using Non-Parametric test.
According to Mcknight & Najab (2010), Chauhan (2015) -to measure the differences between two groups on a single and ordinal variable with no specific distribution Mann-Whitney U test, which is also known as the Wilcoxon rank sum test is used.This helps the researchers better because as compared to independent samples t-test, which is also a test of two groups, requires the data to have a normal distribution and variables need to be measured at the interval or ratio level, rather than the ordinal level.So Mann-Whitney U test is the nonparametric version of the parametric t-test.Both tests require two independently sampled groups and assess whether two groups differ on a single, continuous variable, in this case Sustainability.And the two tests only vary on the assumed distribution.When data do not meet the parametric assumptions of the t-test, the Mann-Whitney U tends to be more appropriate.

So accordingly for Mann Whitney U test
For Sample 1, U 1 = R 1 -n 1 (n 1 +1)/2 where n1 is the sample size for sample 1, and R1 is the sum of the ranks in sample 1.
For sample 2, The sum of two values is given by, As the main objective of the research paper was to test difference between two groups so Mann Whitney test was used for Sustainability data collected through questionnaire and to verify if there was significant difference in the sustainability efforts of organisations working at different scales/operations at different level (Chauhan 2015).
Ho: There is no difference in the Sustainability efforts of Global and SME in India.
Ha: There is a significant difference in the Sustainability efforts of Global and SME in India

Number of Responses
Senior Level Management/managers 32 Mid-Level Management/managers 49

Group-1 = Global organisations in India
Group 2 = Medium/small enterprises in India As the P value is less than 5 per cent level of significance, it was concluded by the data that there is significant difference in the sustainability efforts of Global organisations and SME in India (Mcknight & Najab 2010, Chauhan, 2015) The questionnaire further revealed that, in India for the organisations with respect to Sustainability-

Economic Factors
• All the respondents (Both for Global and SME) agreed that Economic performance is of highest value for their organisations.
• In Global organisations 70% of respondents strongly agreed to the fact that Sustainability is not taken into consideration in decisions involving economic performance of an organisation.
• Only 20% respondents in Global organisations partially agreed that in decisions related to economic performance particularly for supply chain management, they also consider sustainability with respect to natural resources and the society.

Environmental Factors
• More than 70% respondents from Global organisations agreed that for the decisions related to Environmental factors such as materials, products and services they also consider sustainability with respect to natural resources and the society and its impact on the environment which was not the case with SME in which only 20% partially agreed for the same and rest SME respondents chose to be neutral or disagreed with the statement they measure Sustainability for Environmental factors.
• And for the decisions which are related to energy, biodiversity, water, emission, effluent, compliance and transport in Global organisations 60%-80% respondents agreed / strongly agreed that they consider sustainability with respect to natural resources and the society and its impact on the environment as opposed to SME respondents.

Social Factors
• 60% of respondents in Global organisations 30% SME agreed they include social performance .And the organisations follows fair labour practice rules and regulations in relation to employment, labour /management relations, occupational health and safety, training and education, diversity and equal opportunity, non-discrimination, freedom of association and collective bargaining.
• In both Global organisations and SME majority of respondents were neutral to aspect of including product responsibility with respect to Customers

Conclusion
Millennium Goals for countries, Kyoto protocol, COP-21 agreement etc have spruced up the talk about climate talks and action within countries for it.Sustainability is an important yardstick for curbing environmental emissions, to spruce up innovation and for acts which are more responsible but not at the rate of growth for countries.Sustainability though still is a complex business case which doesn't has any settled framework for organisations worldwide to follow.Sustainability disclosures by organisations are increasing worldwide and it is enhancing in Indian organisations as well.
Sustainability is not followed widely as a business case in India.Indian organisations are more engaged in CSR perspective in community and employee enhancement due to government regulation to limit the CSR spends at 2% of their profits which large manufacturing organisations are resorting to.The companies act 2013 mandates the CSR responsibility for organisations and hence it is prominently lying on the agenda though awareness about Sustainability as a business case is increasing and so are disclosures such as through GRI framework.The Indian Global organisations have Sustainability as an important agenda due their presence across different countries and hence this helps them to become more relevant for the local population and for risk management across their supply chain.The sustainability efforts of SME (medium/small enterprises) are not particularly great and they need more work.
The research paper presents a comparison between Sustainability efforts of Global organisations operating in India along with medium/small enterprises in India.There is a clear and significant difference in Sustainability efforts of organisations.And further the questionnaire also reveals that Global organisations and SME consider economic aspects as a priority.With respect to Sustainability Global organisations are focussing on the environmental aspects such as emissions, energy, biodiversity, water, emission, effluent and continue working to improve their social aspects such as fair labour practice rules and regulations in relation to employment, labour /management relations, occupational health and safety, training and education, diversity and equal opportunity, non-discrimination, freedom of association and collective bargaining.SME however is showing come progress on Sustainability for Social factors.As the medium/small enterprises organisations are involved locally and hence they incorporate factors which make them socially relevant in the respective arena.
The Global organisations that have tremendous presence across the globe have made great gains and have sustainability embedded in their business practices.To reduce their risks, and for greater stakeholder value the organisations are resorting to Sustainability practices which is in contrast to SME in India.Medium/small enterprises (SME) are important for India and maximum workforce is employed by them.They are not rule makers but can have tremendous effect on Sustainability efforts in India.The presence of Sustainability case in India is due to global organisations but through value chains the efforts can be transmitted to supplier which can eventually be perpetuated down across the value chain of organisations.
It makes a strong case for SME to work on to become sustainable which also makes a great business case.It will also need some regulation and policy framework as achieving or reducing emissions up-to 33-35% that will call for tremendous efforts and cooperation at all levels.The global organisations need to spruce up their efforts and SME which are far lagging behind due to lack of policy framework and knowledge that must step forward and adopt sustainable business practices to develop new solutions, uncover new opportunities and, ultimately, build the viable, trusted companies of tomorrow for a better and sustainable planet.Hence, intervention through shared governance approach which includes stronger state regulations, sustained social pressure, a more responsible individual consumerism, and tougher national/international legal constraints will help to achieve sustainability.
And thus this will be beyond the ultimate goal of business gains and India will achieve more transformational progress.

When taking decisions, economic
performance is of highest value in our organization.
In decisions related to economic performance, we also consider sustainability w.r.t resources and the society.

Environmental factors
For the decisions related to materials we also consider sustainability w.r.t natural resources and the society and its impact on the environment.
For the decisions related to energy we also consider sustainability w.r.t natural resources and the society and its impact on the environment.
For the decisions related to water we also consider sustainability w.r.t natural resources and the society and its impact on the environment.
For the decisions related to Bio-diversity we also consider sustainability w.r.t natural resources and the society and its impact on the environment For the decisions related to emission we also consider sustainability w.r.t natural resources and the society and its impact on the environment For the decisions related to effluent and waste we also consider sustainability w.r.t natural resources and the society and its impact on the environment For the decisions related to products and services we also consider sustainability w.r.t natural resources and the society and its impact on the environment

Social factors
We follow the fair labor practices rules and regulations for the decisions related to employment.
We follow the fair labor practices rules and regulations for the decisions related to labor/management relations