NEW DELHI (India CSR): Corporate Social Responsibility (CSR) is more than just a regulatory obligation; it’s a commitment by companies to contribute to societal well-being and environmental sustainability. For communities reliant on such initiatives, these funds represent tangible hope—a new school building, access to healthcare, or cleaner environments. When reports emerge detailing significant unspent CSR funds, it often prompts questions about the efficacy of corporate giving and the immediate impact on deserving communities. Nilkamal Limited, a prominent Indian company, recently released its Annual Report for the Financial Year 2024-25, which shed light on its CSR performance, revealing a substantial amount of unspent funds, prompting a closer look at its social investment trajectory.
Nilkamal’s Unspent CSR Funds: Overview
| Category | Details |
|---|---|
| Company Name | Nilkamal Limited |
| Financial Year | 2024–25 |
| Average Net Profit (Past 3 Years) | Rs 1,312.27 crores |
| Total CSR Obligation | Rs 2.61 crores (Rs 2,61,78,000) |
| CSR Spent Amount | Rs 40.55 lakhs (Rs 40,55,000) |
| Unspent CSR Amount | Rs 2.21 crores (Rs 2,21,90,000) |
| Unspent Amount Transfer Date | April 23, 2025 (to Unspent CSR Account) |
| Previous Year Unspent CSR (FY 2022–23) | Rs 1.10 crores |
| Surplus Carried Forward | Rs 0.67 lakhs (Rs 67,000) |
| Administrative Overheads | Nil |
| Impact Assessment Cost | Nil |
| Related Party CSR Contribution | Rs 7.05 lakhs to Nilkamal-controlled Trust |
| Primary CSR Focus Areas | Education, Healthcare, Environmental Sustainability |
| Implementing Agency | Nilkamal Foundation (Section 8 Company) |
| Renewable Energy Usage | 26% of total energy consumption |
| Carbon Emissions Reduced | ~9,572 tonnes |
| Recycled Packaging Material | Over 100 tonnes |
| Use of Post-Consumer Waste | Exploring 100% use of recycled polypropylene polymer |
| Tree Plantation | 8,700+ trees planted |
| Green Certifications | Green-Pro, GRIHA, Green Co Gold (CII), CE Certification, IGBC Membership |
| CSR Committee Meetings Held | 2 |
| Chairman Change in CSR Committee | From Mr. K. R. Ramamoorthy (till June 27, 2024) to Mr. Ashok Kumar Goel |
| Other CSR Committee Members | Hiten V. Parekh, Nayan S. Parekh |
ALSO READ | Nilkamal CSR Spending Report of Rs 40.55 Lakhs for FY25
The Core of the Unspent Funds
For the financial year ending March 31, 2025, Nilkamal Limited’s total Corporate Social Responsibility obligation stood at Rs 2 crore 61 lakh 78 thousand. This figure is calculated based on two percent of the company’s average net profit, which for this period was Rs 131 crore 22 lakh 27 thousand, with a minor adjustment from a previous year’s surplus of Rs 67 thousand. However, the company reported that it spent only Rs 40 lakh 55 thousand on its CSR projects. This considerable gap resulted in an unspent CSR amount of Rs 2 crore 21 lakh 90 thousand for FY 2024-25.
In compliance with statutory provisions, this unspent amount of Rs 2 crore 21 lakh 90 thousand was duly transferred to a designated Unspent CSR Account on April 23, 2025. While this action fulfills the regulatory requirement under Section 135(6) of the Companies Act, 2013, it highlights a challenge in translating allocated funds into immediate, on-the-ground impact within the intended financial year. The company’s detailed report confirms that no amount was spent on administrative overheads related to CSR, nor was any allocated for impact assessment for the year.
Understanding Nilkamal’s CSR Framework
Nilkamal Limited’s CSR framework is governed by the provisions of Section 135 of the Companies Act, 2013. The company has a clearly articulated CSR Policy, which is publicly available on its website, outlining its primary aim to provide education and healthcare facilities and maintain environmental sustainability. The Board of Directors had approved this policy in accordance with Schedule VII of the Companies Act, 2013.
To oversee and monitor its CSR activities, Nilkamal has constituted a dedicated CSR Committee. For the financial year 2024-25, this committee convened two times. Notably, there was a change in the committee’s leadership: K. R. Ramamoorthy ceased to be an Independent Director and Chairman of the CSR Committee on June 27, 2024, upon completing his second term. Subsequently, Ashok Kumar Goel was appointed as the new Chairman effective June 28, 2024. Mr. Hiten V. Parekh and Mr. Nayan S. Parekh also serve as members of this committee, demonstrating executive involvement in the company’s social initiatives.
Beyond the Numbers: Initiatives and Impact
Despite the significant unspent portion, Nilkamal Limited has actively pursued various CSR initiatives. The company undertakes these activities either directly or through various NGOs and trusts, with Nilkamal Foundation – a Section 8 Company – serving as a key implementing agency. The core areas of intervention align with its policy: promoting education and healthcare, alongside other activities specified under Schedule VII of the Companies Act, 2013.
The company’s commitment to sustainability, often intertwined with its environmental CSR, is also evident in its operational philosophy. Nilkamal achieved a notable 26% renewable energy usage out of its total energy consumption during FY 2024-25, leading to an estimated reduction of 9,572 tons of carbon emissions. This is supported by initiatives like optimizing partnerships with wind energy farms and planning the purchase of energy-efficient injection molding machines. The company has also demonstrated efforts in circular economy principles, initiating the recycling of over 100 tonnes of packaging material and exploring the use of 100% post-consumer waste polypropylene polymer. Nilkamal’s environmental dedication has garnered prestigious recognitions, including the Green-Pro, GRIHA Green Co Gold award from CII, CE Certification, and IGBC Membership. Furthermore, in line with its “green future” vision, Nilkamal planted over 8,700 trees around its manufacturing facilities during the financial year, involving employees and their families in these efforts.
The Annual Report also highlights a related party transaction for CSR expenditure, with Rs 7 lakh 5 thousand contributed to a trust controlled by the company, likely Nilkamal Foundation. This indicates direct investment into specific social projects through its own foundation.
The Imperative of Effective CSR Spending
The existence of a substantial unspent CSR amount, totaling Rs 2 crore 21 lakh 90 thousand, signals a potential disconnect between intention and execution for Nilkamal Limited in FY 2024-25. While the regulatory compliance of transferring these funds to an Unspent CSR Account is met, the immediate benefits to the intended beneficiaries are deferred. This isn’t an isolated incident for the company; the report notes that in a previous year, FY 2022-23, Rs 1 crore 10 lakh of CSR funds also remained unspent and were transferred to the designated account. The continued recurrence of such unspent amounts raises questions about the company’s planning and implementation capabilities for its social initiatives.
Effective CSR is not merely about allocating funds but ensuring their timely and impactful deployment. Unspent funds, even if transferred to a special account for future use, represent missed opportunities for addressing immediate societal needs and enhancing community well-being in the present.
Path Forward: Strengthening Community Engagement
Nilkamal Limited’s commitment to social responsibility and sustainable development is clearly articulated in its policies and various initiatives, particularly in environmental stewardship and fostering equitable opportunities, as championed by leaders like Mr. Sharad V. Parekh. However, the significant unspent CSR funds for FY 2024-25 present a critical area for improvement.
To enhance its societal impact, Nilkamal could focus on strengthening its CSR execution strategies by:
- Proactive Project Planning: Developing more robust, long-term projects with clear implementation roadmaps that can absorb the allocated funds within the financial year.
- Enhanced Partnerships: Expanding collaborations with NGOs and trusts with proven track records in education, healthcare, and environmental sectors, ensuring efficient and timely deployment of funds.
- Streamlined Processes: Reviewing internal processes for CSR project identification, approval, and monitoring to minimize delays and bottlenecks that lead to unspent amounts.
- Increased Transparency: Beyond regulatory requirements, engaging in proactive public communication about the reasons for unspent funds and specific plans for their utilization in the future, fostering greater trust among stakeholders.
By addressing the challenge of unspent CSR funds, Nilkamal Limited can further solidify its position as a truly responsible corporate citizen, ensuring that its financial commitment translates into tangible, transformative benefits for the communities it aims to serve. The company has a strong foundation of values, as emphasized by the late Mr. Vamanbhai V. Parekh, who shaped Nilkamal’s culture of care and humility, focusing on “people—the lives uplifted”. This human-centered approach must remain at the forefront of its CSR endeavors to ensure every rupee dedicated to social good reaches its intended purpose without delay.
(India CSR)
