NEW DELHI (India CSR): Corporate social responsibility (CSR) spending by Central Public Sector Enterprises (CPSEs) surged by 19% to Rs. 4,911 crore in FY24, marking a four-year high, according to the Public Enterprises Survey released by the Ministry of Finance. The increase highlights the growing commitment of CPSEs toward societal development and sustainability.
Introduction: CSR at a Four-Year High
In FY24, CPSEs ramped up their CSR activities, recording a 19% rise in spending compared to FY23. The total expenditure of Rs. 4,911 crore reflects the highest level since FY20, demonstrating a rebound in social responsibility efforts after a dip in the previous fiscal year.
“This increase in CSR spending by CPSEs showcases their dedication to contributing to India’s socio-economic development,” said a senior government official.
Top Contributors to CSR Spending
The top five CPSEs leading CSR expenditures in FY24 include:
- Oil and Natural Gas Corporation (ONGC)
- Indian Oil Corporation (IndianOil)
- Power Grid Corporation of India
- REC Limited
- Power Finance Corporation
Collectively, the top 10 CPSEs accounted for 56.72% of the total CSR spending. These funds have been channeled into initiatives such as healthcare, education, environmental sustainability, and rural development.
Key Facts on CSR Spending and CPSEs Financial Performance (FY24)
| Aspect | Key Information |
|---|---|
| Total CSR Spending by CPSEs | Rs 4,911 crore (19% increase from FY23) |
| Top CSR-Contributing CPSEs | ONGC, Indian Oil Corporation, Power Grid Corporation, REC Limited, Power Finance Corporation |
| Top 10 CPSEs Contribution to CSR | 56.72% of total CSR expenditure |
| Profit-Making CPSEs (Net Profit) | Rs 3.43 trillion (38.66% increase from Rs 2.47 trillion in FY23) |
| Loss-Incurring CPSEs (Net Loss) | Rs 21,000 crore (27.6% decrease from Rs 29,000 crore in FY23) |
| Mandated CSR Spending | Minimum 2% of average net profit of the past three years for eligible companies |
| Key CSR Focus Areas | Healthcare, sanitation, education, rural development, environmental sustainability, women empowerment |
| Gross Revenue from Operations | Rs 36.08 trillion (4.7% decline from FY23) |
| Top Revenue-Generating CPSEs | IndianOil, BPCL, Hindustan Petroleum Corporation, Food Corporation of India, NTPC |
| Sectoral Contribution to Revenue | – Petroleum: 56.62% – Power Generation: 6.11% – Transport & Logistics: 5.05% – Trading & Marketing: 4.86% |
| Growth in Operating CPSEs Profits | 47.4%, reaching Rs 3.22 trillion |
Sectoral Growth in Financial Performance
While CSR spending saw a notable rise, CPSEs also experienced robust financial growth:
- The net profit of profit-making CPSEs increased by 38.66%, reaching Rs 3.43 trillion in FY24 compared to Rs 2.47 trillion in FY23.
- Sectors such as petroleum refining and marketing were significant contributors to this growth, with ONGC, IndianOil, Bharat Petroleum Corporation (BPCL), NTPC, and Coal India leading the pack.
On the downside, net losses among loss-incurring CPSEs reduced by 27.6%, falling to Rs 21,000 crore from Rs 29,000 crore in FY23. Key loss-makers included Bharat Sanchar Nigam Limited (BSNL), Rashtriya Ispat Nigam, and Mahanagar Telephone Nigam Limited (MTNL).
Government Mandate on CSR Spending
The surge in CSR activities aligns with the government’s mandate that all companies with a net worth of at least Rs 500 crore, a turnover of Rs 1,000 crore, or a net profit of Rs 5 crore allocate 2% of their average net profits from the previous three years to CSR.
The funds are utilized for diverse projects, including:
- Healthcare and sanitation
- Rural development
- Education and skill development
- Environmental sustainability
- Empowerment of women and marginalized communities
“CPSEs are not just profit-making entities; they are agents of change, driving development in critical sectors,” remarked an industry expert.
Revenue and Sectoral Contributions
Operating CPSEs saw a 47.4% rise in net profits, reaching Rs 3.22 trillion in FY24. However, gross revenue from operations declined by 4.7% to Rs 36.08 trillion.
Key sectors contributed significantly to the overall revenue:
- Petroleum (56.62%)
- Power generation (6.11%)
- Transport and logistics (5.05%)
- Trading and marketing (4.86%)
Among the highest revenue generators in FY24 were IndianOil, BPCL, Hindustan Petroleum Corporation, Food Corporation of India, and NTPC.
You Learn
The remarkable increase in CSR spending by CPSEs underscores their commitment to addressing India’s pressing socio-economic challenges. As profits rise and the government strengthens regulations, CPSEs are poised to play an even more significant role in fostering inclusive growth.
“The rise in CSR spending reflects a balance between profitability and responsibility,” said an economist. “It’s a step forward in creating a sustainable and equitable future for India.”
(India CSR)
