It is not mandatory for the corporate sector to spend 2% of the companies’ profit on CSR activities, says Moily
Apart from certain guidelines for the central public sector enterprises (CPSEs), there are no mandatory guidelines or provisions for spending by Indian companies on CSR activities, Corporate Affairs Minister Veerappa Moily informed the Lok Sabha in a written reply.
The minister replied in negative to a question whether the government has conducted any assessment to ascertain the companies’ compliance to the laid down CSR guidelines.
Moily further said that the government has not made it mandatory for the corporate sector to spend 2% of the companies’ profit on CSR activities.
However, the Department of Public Enterprises had issued guidelines in April 2010 for CPSEs for mandatorily creating a CSR budget as a specified percentage of net profit of the previous year, he said.
The Ministry of Corporate Affairs in July last year had released National Voluntary Guidelines on Social, Environmental and Economic Responsibilities of Business to be adopted by companies as part of their business practice.
Besides, market regulator Sebi earlier this month mandated inclusion of Business Responsibility Reports as part of the annual reports for top 100 listed entities by market capitalisation at the BSE and NSE.
In addition, other listed companies may voluntary disclose their Business Responsibility Reports, the minister said.
(Press Trust of India / New Delhi Aug 30, 2012)