In a time when corporate social responsibility (CSR) is increasingly emphasized, Infosys Limited’s unspent CSR funds pose a question: Do these represent a missed opportunity for social impact or a strategic reserve for future initiatives?
BENGALURU (India CSR Exclusive): According to its latest Integrated Annual Report 2022-23, technology major Infosys Limited seems to have missed a significant opportunity to maximize its social impact, leaving a substantial Rs. 45.33 crores of its Corporate Social Responsibility (CSR) funds unspent.
As mandated by Indian law, Infosys is obliged to allocate 2% of its average net profits from the preceding three financial years toward Corporate Social Responsibility activities. For the fiscal year 2023, Infosys reportedly spent Rs. 391.51 crores on various projects, an admirable effort but still short of their total CSR commitment.
The report reveals that the remaining Rs. 45.33 crore, while planned for various ongoing projects, has yet to be put into action. Although this sum will be transferred to the unspent Corporate Social Responsibility account and spent in accordance with the Companies (Corporate Social Responsibility Policy) Rules, 2014, and amendments afterthat, it does bring into question why these funds remained unused during fiscal 2023.
Details of unspent CSR amount
| Sl. No. | Preceding Financial Year(s) | Amount Transferred to Unspent Account under Sub-Section (6) of Section 135 (In INR Crore) |
|---|---|---|
| 1 | Fiscal 2020 | – |
| 2 | Fiscal 2021 | 49.52 |
| 3 | Fiscal 2022 | 51.79 |
In addition to the unspent amount, Infosys disclosed that they spent Rs. 64.39 crore on ongoing projects from fiscals 2021 and 2022. This suggests that the company has an ongoing issue with efficiently allocating and spending its Corporate Social Responsibility budget within the allocated fiscal year.
Moreover, while Infosys proudly announces its CSR expenditures in other parts of the world, including the United States, Australia, and Europe – over and above their statutory requirement in India – it’s worth asking whether the company could channel its unspent funds more effectively.
The management’s seeming inability to fully utilize allocated Corporate Social Responsibility funds within the given fiscal year signals a lack of planning or perhaps a disconnect between Infosys’s CSR commitments and their execution. As one of India’s leading corporations, Infosys has a significant role to play in driving social impact. It is hoped that moving forward, they will be able to address these issues to maximize their Corporate Social Responsibility spending and, consequently, their social impact.
Also Read: Who Is The Chairperson Of The CSR Committee At Infosys Limited
CSR Spending Analysis
Here’s a detailed breakdown of Infosys’s Corporate Social Responsibility spending in fiscal 2023:
| Particulars | Amount (INR Crore) |
|---|---|
| Average net profit (Section 135 (5)) | 21,842.00 |
| 2% of average net profit (Section 135 (5)) | 436.84 |
| Surplus arising from CSR projects or programs | Nil |
| Amount required to be set-off | Nil |
| Total CSR obligation for the year | 436.84 |
| Amount spent on CSR projects | 390.17 |
| Unspent | 45.33 |
| Amount spent on administrative overheads | 0.85 |
| Amount spent on impact assessment | 0.49 |
| Total amount spent for the year | 391.51 |
