Responsible Leadership at the Time of the Pandemic: SMEs in India

Abstract

AbstractUNIDO (United Nations Industrial Development Organization) for long has emphasized the need to include corporate social responsibility (CSR) into the core business strategy of firms to tide over global recessions or uncertainties. At times, it is argued that the SMEs inherently follow some of the aspects of social responsibility as they have a greater consciousness of local issues and political contexts; greater connections with local civil society and a commitment to operate in a particular area. However, the socially and environmentally responsible actions of SMEs remain below the radar of academic discourse. It is suggested that entrepreneurs can contribute to solving environmental problems by helping existing institutions achieve their goals, by creating new and more environmentally sustainable products, services and institutions. Several terms are used to describe this responsible behaviour of entrepreneurs, namely, ‘sustainable entrepreneurship’, ‘green entrepreneurship’, ‘environmental entrepreneurship’, ‘eco-preneurship’ and ‘social entrepreneurship’. At the level of an organization, the role of Responsible Leadership (RL) is to ensure the triple bottom line of sustainability at the economic, environmental and social fronts. While describing the various qualities of a Responsible Leader, scholars maintain that an RL is a ‘role model’ for society. In the existing literature, the role of the leader does not seem to depend much on the size of the firm or the organization. At the same time, however, we know that uncertainties challenge firms differently across their size class. It is generally acknowledged that smaller firms suffer more, compared to their larger counterparts when the economy is not functioning well, as the former have lesser resources and opportunities to deal with such upheavals. However, smaller ones often have an edge due to their flexible modes of operations. A recent study has indeed shown that many small scale Indian firms managed to survive the Covid-19 situation through the extensive use of ‘digitization’, ‘multi-sector collaborations’, ‘localization’, and incorporation of social agenda in their business strategy. In this chapter, we discuss how responsible leadership in smaller and medium-sized firms in developing countries can make an impact at times of economic crisis. Rather than formally adhering to the standardized structure of CSR, they can work by improvising their ways to solve local problems in a socially engaging, yet economically sound manner. We analyse these actions by taking examples from grey literature and social media platforms.KeywordsSMEsResponsible leadershipSustainabilityCSRIndia