Companies in India have spent over Rs 50,000 crore on Corporate Social Responsibility (CSR) works in 5 last years. Companies Act was amended in 2013-14 making it mandatory for cos with a specified level of profit to spend 2% of it on social welfare.
The corporate sector has set aside over Rs 10,000 crore every fiscal year since 2014-15 towards corporate social responsibility.
Maximum funds have been given to projects for poverty alleviation, safe drinking water, education, health.
Mandatory CSR is an attempt by the government to involve businesses in the nation’s sustainable development goals and to supplement government efforts in this regard through monetary contributions.
It gives a freedom to donors on how they can spend their philanthropic rupee – limited to the categories mentioned in Schedule VII of the Act, and in ways mentioned therein.
The companies with a net worth of over Rs 500 crores, or a turnover of over Rs 1,000 crores, or a net profit of over Rs 5 crore in the preceding financial year are required to spend 2 per cent of their average net profit of the preceding three years on CSR. The companies are liable to disclose the CSR related details in the Director’s Report every year.
Out of the total CSR prescribed of Rs 23,247 crores in FY18, the companies spent only Rs 13,326 crores, which is only 57 per cent of the required expenditure.
The companies which are liable for CSR must have their CSR policies, however out of 21,337 companies that reported itself liable for the CSR expenditure, only 6,326 companies said that they have a CSR policy.
