Axis Bank Demonstrates Strong Commitment to Corporate Social Responsibility
In line with the legal provisions of Section 135 of the Companies Act, Axis Bank has not only formulated a CSR policy but also initiated various interventions across India. Operating since 2006, the Axis Bank Foundation (ABF) has been at the forefront of these activities, conducting CSR initiatives directly, and through other credible partners. The bank has also established a dedicated CSR Committee to oversee these operations.
CSR Policy: Integrated Approach towards Holistic Development
The CSR policy of Axis Bank reflects its philosophy to bring about meaningful change in the lives of disadvantaged communities in the country. The bank is deeply committed to enhancing livelihood opportunities, improving education and skills development, and raising awareness about financial literacy, health, and hygiene.
The policy also demonstrates the bank’s commitment to environmental sustainability and conservation, besides contributing to improvements in health and nutrition. The bank aims to provide access to formal banking channels for unbanked and under-banked sections of society – a critical step towards financial inclusion.
The CSR initiatives are implemented either directly by the bank, through Axis Bank Foundation (ABF), or by other implementation partners, as set out in the annual action plan (AAP). The Board of Directors of Axis Bank approves this AAP.
A Comprehensive Spectrum of CSR Activities
Since the introduction of Section 135, Axis Bank has expanded its scope of CSR activities. The bank now conducts a wide array of developmental initiatives across India in accordance with Schedule VII of the Companies Act.
These include targeted interventions to support the socially, economically, financially, and physically excluded or challenged communities across India. The bank seeks to create opportunities that enhance living standards and foster overall development, by improving the quality of education and promoting skills development.
Promoting Financial Inclusion and Environmental Sustainability
Financial inclusion and environmental sustainability form crucial pillars of Axis Bank’s CSR strategy. The bank is keen on facilitating access to formal banking channels for un-banked and under-banked sections of the society, an important step towards achieving financial inclusion.
Meanwhile, the bank also remains committed to supporting environmental sustainability and conservation efforts. These initiatives underline Axis Bank’s commitment to not just financial growth but also the growth and wellbeing of society and the environment.
CSR Expenditure Analysis for the Fiscal Year 2022-23
| Description of the Item | Amount in Rs. Crores |
|---|---|
| (a) Average net profit of the company as per sub-section (5) of Section 135 | 9973 |
| (b) Two percent of average net profit of the company as per sub-section (5) of Section 135 | 199.46 |
| (c) Surplus arising out of the CSR projects or programmes or activities of the previous fiscal years | NIL |
| (d) Amount required to be set-off for the fiscal year, if any | Not applicable |
| (e) Total CSR obligation for the fiscal year [(b)+(c)-(d)] | 199.46 |
| (a) Amount spent on CSR projects (both ongoing project and other than ongoing project) | 171.61 |
| (b) Amount spent in administrative overheads | 0.59 |
| (c) Amount spent on impact assessment, if applicable | 0.11 |
| (d) Total amount spent for the fiscal year [(a)+(b)+(c)] | 172.31 |
Analysis
- CSR Obligation & Expenditure: The company has an obligation to spend Rs 199.46 crores towards Corporate Social Responsibility (CSR), based on the requirement of 2% of the average net profit (Rs. 9973 crores). However, during this fiscal year, the company has spent Rs. 172.31 crores, which is less than its obligation.
- Expenditure on Projects: Out of the total expenditure, a significant amount (Rs. 171.61 crores) was directed towards CSR projects. This indicates that a large proportion of the budget was spent on actual projects rather than being consumed by administrative costs or impact assessment, suggesting efficient budget management.
- Administrative and Impact Assessment Costs: The company has managed to keep its administrative overheads ( Rs. 0.59 crores) and impact assessment costs ( Rs. 0.11 crores) relatively low in comparison to the total expenditure. This demonstrates effective allocation of funds.
- Set-off & Surplus: The company has not indicated any set-off amount or surplus from previous years’ CSR projects, which implies that the calculation of the CSR obligation is based solely on the 2% of the average net profit. This may also imply that all funds allocated for CSR in previous years were utilized and none were carried forward.
Analysis of CSR Spending and Surplus Management for Fiscal Year 2022-23
Here is the table you’ve provided, which summarizes the company’s Corporate Social Responsibility (CSR) financials for a certain fiscal year.
| Sl. no. | Particular | Amount (in Rs. crores) |
|---|---|---|
| (i) | Two percent of average net profit of the company as per sub-section (5) of Section 135 | 199.46 |
| (ii) | Total amount spent for the fiscal year | 201.92 |
| (iii) | Excess amount spent for the fiscal year [(ii)-(i)] | 2.46 |
| (iv) | Surplus arising out of the CSR projects or programmes or activities of the previous fiscal year, if any | NIL |
| (v) | Amount available for set off in succeeding fiscal years [(iii)-(iv)] | 2.46 |
Let’s analyze this table
- The first row indicates that the company is required to spend Rs. 199.46 crores on CSR activities. This is calculated as 2% of the average net profit of the company, in accordance with sub-section (5) of Section 135 of the Companies Act, 2013 in India.
- The second row shows that the company has actually spent Rs. 201.92 crores on CSR activities for the fiscal year, which is more than the amount they were required to spend.
- The third row indicates the excess amount spent on CSR activities by the company, which is Rs. 2.46 crores. This is calculated as the difference between the total amount spent and the 2% of average net profit obligation (i.e., Rs. 201.92 crores – Rs. 199.46 crores).
- The fourth row indicates that there was no surplus arising out of CSR projects or programmes or activities from the previous fiscal year.
- The last row indicates the amount that the company can set off in the succeeding fiscal years, which is Rs. 2.46 crores. This is calculated as the difference between the excess amount spent and any surplus arising out of CSR projects (i.e., Rs. 2.46 crores – NIL).
