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ITC e-Choupal: Corporate Social Responsibility in Rural India

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Business decisions need not be intentionally altruistic, but empowering the community eventually creates both notional wealth (in the form of brand recognition) and actual wealth (in the form of profits) for companies. Set against the backdrop of underserved, overexploited rural India, this case highlights how the use of technology by the Indian conglomerate ITC has transformed the lives of many rural Indians while at the same time benefiting the company. Continually plagued by an inefficient supply chain in rural agriculture, ITC implemented the e-Choupal initiative in 2000. By establishing a direct channel between the farmer and ITC, e-Choupal significantly marginalised the role of middlemen, thereby ensuring farmers more money for their produce. In doing so, e-Choupal not only mitigated ITC's agrarian supply chain concerns, but also achieved a greater good—the economic uplift and empowerment of the Indian farmer. Although e-Choupal was conceived as ITC's answer to its supply-chain woes, ITC was quick to realise that it had discovered the delicate balance between achieving corporate profitability and making a social contribution. Aware of the multitude of challenges faced by impoverished rural Indians, ITC extended its e-Choupal framework to deliver core services, such as healthcare, education and information. Evolving into a platform for community development, e-Choupal is both eradicating poverty and chipping away at rural isolation, even while ITC continues to enjoy the benefits of functional procurement and distribution value chains.

Learning Objective:

Blending social responsibility with corporate profitability

Year of Publication: 2008
Ref. No.: 08/384C
Discipline: Social Enterprises & Ethics, Strategy & General Management
Industry: Conglomerates, Food, Beverage & Tobacco
Country: India
Company: ITC
Languages: English
Pages of Text: 26