Guidelines on CSR and Sustainability


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By Sutanu Behuria 

In the last few years, the pioneering initiatives of the Department of Public Enterprises (DPE) in promoting awareness of the concept and philosophy of Corporate Social Responsibility (CSR) in the public sector enterprises in India through issue of guidelines on the subject, and regular interface with the management of CPSEs to ensure adherence to the guidelines in letter and spirit, has resulted in widespread understanding and acceptability of CSR in the country.

The first guidelines on CSR issued by DPE in April 2010 made it mandatory for public sector enterprises to set aside a fixed percentage of their profits for CSR activities. Subsequently, DPE explored a new dimension of CSR as a form of responsible business to be adopted voluntarily by the companies.

After extensive consultations with all key stakeholders, DPF  issued revised guidelines on CSR and Sustainability, effective from 1st April 2013, Which incorporated the global best practices but retained focus on the domestic socio- economic requirements of our country.

As a result, DPF guidelines were very well received by the practitioners, the stakeholders and CSR experts, and got wide acclaim in international for also where DPE was invited to share its views with the international audience.

The thrust of DPE guidelines on CSR and Sustainability has been on inclusive growth, development of backward regions, upliftment of the marginalized under privileged and weaker sections of the society, empowerment of women, environment sustainability, promotion of green and energy efficiency technologies and sustainability development in all its diverse aspects. The CSR and Sustainability initiatives taken by CPSEs.

In compliance of DPE guidelines on the subject have made tangible socio-economic and environmental impact for the betterment, though comprehensive studies have not yet been undertaken to accurately measure the impact.

More importantly, there is a discernible change in the mind-set of the top management of the CPSEs in their commitment to conduct business in a socially, economically and environment responsible manner that promotes sustainable development.

The incorporation of specific provisions on CSR in the Companies Act 2013 was, in a way, a vindication and culmination of the efforts of DPE to mobilize the support of all key stakeholders to propagate the concept and philosophy of CRS and ensure its proper implementation in a developing economy like ours.

The Companies Act 2013 makes it mandatory for all companies which fulfil the eligibility criteria based on profitability to spend at least 2% of their average net profits of three preceding years on CSR.

India is perhaps the first country to make it mandatory by legislation for companies to discharge their Corporate Social Responsibility in a prescribed manner.

Since CSR and Sustainability are dynamic subjects, DPE is constantly exploring new dimensions of these subjects and devising new implementation strategies to make CSR and Sustainability portent tool for achieving national development agenda along with sustainable development goals.

( Sutanu Behuria is secretary of HIPE)

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