India CSR News Network
AHMEDABAD: Activities under Corporate Social Responsibility (CSR) by firms in Gujarat have been increasing as companies from the state increased their CSR spendin in the financial year 2015-16. In fact, the state ranks third -after Maharashtra and National Capital Territory (NCT) of Delhi -in CSR spending by listed firms.
As per the report covered in Times of India, an analysis by Crisil Foundation shows that as many as 118 companies listed on BSE (the Bombay Stock Exchange) from Gujarat spent Rs 666 crore on CSR activities in the financial year 2016, which is a rise of 14.82% over the Rs 580 crore spent by 95 companies in the previous financial year.
Under the Companies Act-2013, all companies having net worth of Rs 500 crore or more, or a turnover of Rs 1,000 crore or more, or a net profit of Rs 5 crore or more, during any financial year are required to spend at least 2% of the average net profits of the company in the three immediately preceding financial years. The new CSR rules came into effect on April 1, 2014 and the financial year 2014-15 was the first year of implementation.
The Crisil study further states that over 54.10% of the firms succeeded in spending 2% or more of their three years’ average net profit in CSR activities, while 45.90% could not meet the mandatory spending requirement. The bulk of the money went into education, skill development, he althcare and sanitation initiatives.
“In fiscal 2015, smaller companies had spent relatively more, but in fiscal 2016, the larger ones have done well with more than half of them adhering to the 2% mandate versus approximately a third previously ,” the study says.
Across the country , 1,158 out total 4,887 firms listed on BSE reported on their CSR activities. All these firms cumulatively spent Rs 8,300 crore, which showed an increase of Rs 2,500 crore or 22% over Rs 5,800 crore in the financial year 2014-15.
“As much as Rs 5,300 crore were spent on CSR activities linked to education, skills development, healthcare and sanitation which are also the government’s priority areas,” the report says.