What is National Voluntary Guidelines ?
The NVGs serves as a guidance document for businesses of all size, ownership, sector, and geography to achieve the triple bottom line. In 2012, subsequent to the release of the NVGs the Securities and Exchange Board of India (SEBI), a market regulator, mandated the Annual Business Responsibility Reporting (ABRR), a reporting framework based on the NVGs.
Meaning of National Voluntary Guidelines
The National Voluntary Guidelines (NVG) are unique, not just in what they represent, which is an India specific comprehensive understanding of business responsibility", but also in the way they have been formulated. The "process" was premised on widespread intensive stakeholder consultations to bring out the commonly agreed elements of business responsibility in keeping with India's unique developmental challenges and priorities.
The NVGs serves as a guidance document for businesses of all size, ownership, sector, and geography to achieve the triple bottom line. In 2012, subsequent to the release of the NVGs the Securities and Exchange Board of India Board of India (SEBI),[3] a market regulator, mandated the Annual Business Responsibility Reporting (ABRR), a reporting framework based on the NVGs.
9 Principles of National Voluntary Guidelines
The national framework on Business Responsibility is essentially a set o
nine principles that offer businesses an Indian understanding and approach to inculcating responsible business conduct. Those are as follows :
✔️ Principle 1 :
Businesses should conduct and govern themselves with ethics, transparency and accountability.
✔️ Principle 2 :
Businesses should provide goods and services that are safe and contribute to sustainability throughout their life cycle.
✔️ Principle 3 :
Businesses should promote the well-being of all employees.
✔️ Principle 4 :
Businesses should respect the interests of and be responsive towards all stakeholders.
✔️ Principle 5 :
Businesses should respect and promote human rights.
✔️ Principle 6 :
Business should respect, protect and make efforts to restore the environment
✔️ Principle 7 :
Businesses, when engaged in influencing public and regulatory policy, should do so in a responsible manner.
✔️ Principle 8 :
Businesses should support inclusive growth and equitable development.
✔️ Principle 9 :
Businesses should engage with and provide value to their customers and consumers in a responsible manner.
Steps in Implementation of Guideline of National Voluntary Guidelines
The NVG suggested the process of implementation of the guidelines. The proposed process had 4 steps :
Step 1 - Leadership :
The Chairman/CEO/Owner/ Manager should play a proactive role in convincing the board/top management and staff within the business that adopting these principles is crucial for success. The board and senior management need to ensure that the principles are fully understood across the organization and comprehensively executed.
Step 2 - Integration :
These principles and core elements must be embedded in the business policies and strategies emanating from the core business purpose of the organisation. For this to happen, these must align with each business internal values and/or must provide clear business benefits.
Step 3 - Engagement:
Building strong relationships and engaging with stakeholders on a consistent, continuous basis is crucial.
Step 4 - Reporting :
Implementation process includes disclosure by companies of their impact on society an environment to their stakeholders.