Godrej Consumer Product Ltd (GCPL) has spent Rs 19.49 crore on the corporate social responsibility (CSR) initiatives in FY 2019-20. It is about 23% lower than the mandated amount of Rs 25.34 crore. Company spent Rs 21.87 crore in FY 2018-19.
Godrej Consumer Products is a part of the over 123-year-young Godrej Group, enjoys the patronage of
1.15 billion consumers globally, across different businesses.
A total of Rs 19.49 crore was spent, against the mandated amount of Rs 25.34 crore. The unspent amount is Rs 5.85 crore, the company annual report said.
The CSR provision requires affected companies to spend at least 2% of their average net profits made in the preceding three years on CSR.
In its annual report, the company said its average net profit in the last three fiscal years stood at Rs 1,267 crores and prescribed CSR budget was Rs 25.34 crore for the 2019-20 fiscal.
The CSR Committee has approved that the unspent funds be carried forward to the 2020-21 fiscal in addition to the prescribed 2% CSR budget for 2020-21, it said.
According to GCPL, projects worth this amount had been sourced and committed, with signed MoUs and deliverables agreed during the financial year itself.
In order to ensure proper utilization of funds and high-quality results from our CSR initiatives, we believe in funding projects on tranche basis. The whole grant is not given upfront in advance and is instead given in stages when certain milestones are achieved, the report added..
This led to an underspend of Rs 5.85 crore during the financial year. The Company is committed to spend the unspent funds specifically for the selected projects in 2020-21, it added.
The company spent CSR funds on livelihood enhancement projects, promoting preventive healthcare, rural development projects, environment sustainability, education and traditional arts during 2020-21.
As per Section 135 of the Indian Companies Act, 2013, a company, meeting the applicability threshold, needs to spend at least 2% of its average net profit computed as mandated by the Act for the immediately preceding three financial years on CSR activities. The Act prescribes that every company having a net worth of Rs. 500 crore or more, or turnover of Rs. 1,000 crore or more, or a net profit of Rs. 5 crore or more during any financial year shall ensure that it spends, in every financial year, at least 2% of the average net profits computed as mandated by the Act, in pursuance of its CSR Policy.
