Many corporates are spending in the name of CSR but those expenditures are mostly not covered as CSR as per the latest amendments made by Govt. of India
IndiaCSR News Network
HYDERABAD: A two-day workshop on CSR will be organized by New Delhi based Greentech Foundation. The Workshop will be conducted by Dr. Bhaskar Chatterjee, IAS (Retd), Director General & CEO, Indian Institute of Corporate Affairs, Ministry Corporate Affairs, Government of India in Goa on May 30-31 informed Kamleshwar Sharan, President of Greentech Foundation. He was in city today on a roadshow to create awareness about the forthcoming workshop on CSR.
Now with New Companies Act already in force, making CSR Mandatory for “All companies with turnover of Rs 1,000 crore and more – or a net worth of Rs 500 crore and more or net profit of Rs 5 crore and more – will have to spend at least two percent of their three-year average profit every year on CSR activity,” there is an urgent need for such a training and workshop, informed Kamleshwar Sharan.
To give a better understanding on the subject of CSR Dr. Chatterjee himself will throw light on the same in the workshop.
CSR spending has become mandatory w.e.f. 1st April 2014 onwards. There are many companies who are spending in the name of CSR but those expenditures are mostly not covered as CSR as per the latest amendments made by Govt. of India recently. Most of companies are not aware of the guidelines laid down as per the recent amendments in the Indian Companies Act informed Kamleshwar Sharan.
Only few companies qualify for CSR who have turnover of over Rs. 1,000 croreor average net profit of Rs. 5 croreor more in the preceding three years. There are around 20,000 companies in India who qualify for mandatory CSR spending. Hence there is an urgent need for those companies to know all the provisions of the CSR.
They have to spend 2% of the profit after tax.It is mandatory to spend and also report to the Government.If the companies do not spend, as above, they have to report the reason. If they don’t spend and don’t report, then the Government will penalize and impose fine etc. under Section 134.If the companies do not spend the CSR amount as per the framework laid down, the amount spent will not be considered as CSR expenditure.
Considering the urgent need of the companies, Greentech Foundation is shortly organizing two-days workshop on CSR to train executives of those companies, covered under CSR, about concept, implementation and reporting. The workshop will equip them with detail knowledge about CSR spending informed Kamaleshwar Sharan, in a press note issued in Hyderabad today. The knowledge gained from the workshop will save them from penalties.
The days of cheque book charity where you give a cheque to a temple or an organizationor are over. Under this new law there are many more things to take care of. CSR must be conducted by professional implementation agencies. Any activity that is not a project is not CSR. The Project should have a starting date and an ending date. Mere monitoring or documenting with pictures of a program or activity is not CSR.
According to Dr. Bhaskar Chatterjee corporates must go beyond financial gains and must be accountable for social, economic and environment effects of their business. What CSR means to western world is different from what it means to us. For us in India social development is more important. The ministry wants companies also to take part in the development of the society.
Projections are that it will increase CSR spending in India by Rs 27,000 crore per year.
The smart, structured CSR will play a key role in contributing to India’s development. India with population of over 1.2 billion, faces many challenges. Government is taking a proactive approach to involve companies in the quest for practical solutions in an effort to ensure that the whole population profits from economic growth said Dr. Bhasker Chatterjee.