HDFC Bank Limited, one of the largest private sector bank, has spent Rs 535.31 crore on various Corporate Social Responsibility (CSR) initiatives during FY 2019-20, in accordance with Companies Act, 2013, the company’s annual report revealed. Previous year CSR expenditure was Rs. 443.77 crore.
The Bank has spent 2.01% (previous year: 2.02%) of its average net profit for the last three financial years as part of its CSR for the year ended March 31, 2020.
Average net profit of the Bank for last three financial years stood at Rs. 26,680 crore. Prescribed CSR Expenditure (two percent of the amount as in item 3 above) stood at Rs. 534 crore, in accordance with the provisions of Section 198 of the Act.
The Bank contributed Rs. 70 crore towards Prime Minister’s CARES Fund to support the government’s fight
against the COVID-19 pandemic.
Its Rural Development Programme has touched another 16 lakh people across more than 1,200 villages in 17 states.
The Bank’s CSR is implemented under the aegis of ‘Parivartan’ which is the umbrella brand for all the Bank’s social initiatives. Parivartan aims to bring about a transformation in the communities in which the Bank operates through multiple initiatives in the areas of Education, Skill Training and Livelihood Enhancement, Health Care, Environmental Sustainability and Rural Development.
The Bank’s programs are guided by CSR Policy duly approved by the Board which is driven by the vision of ‘Creating Sustainable Communities’. The CSR policy and programs are aligned to comply with the requirements of Section 135 of the Companies Act, 2013 and are monitored by a board level committee.
The Corporate Social Responsibility (CSR) Committee of the Board has been constituted to identify, execute and monitor CSR projects and assist the Board and the Bank in fulfilling its corporate social responsibility objectives and achieving the desired results. The Committee shall also ensure legal and regulatory compliance from a CSR perspective and reporting as well as communication to all the stakeholders on the Bank’s CSR initiatives.
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.
Rusen Kumar is the founder and managing editor of India CSR. He regularly writes on Sustainability and CSR.