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故事

2016年1月10日

India: CSR spending increased, but more needs to be done

The Companies Act, 2013, requires companies above a certain financial threshold to spend at least two per cent of their average net profit of the preceding three years on CSR. Although CSR spending is compulsory, the Act has taken a ‘comply or explain’ approach, where a company has to provide reasons if the spending is less than the stipulated amount. Spending on activities by the top 100 increased to Rs 5,240 crore in 2014-15. The figure had stood at Rs 3,000 crore in 2012-13, when CSR spending was voluntary. Although the increase looks healthy, Institutional Investor Advisory Services (IiAS), the corporate governance consultancy that has compiled these numbers, points out that the figure, at Rs 5,240 crore, was actually 26 per cent lower than the amount indicated in the law. This underlines the largely pro forma approach to CSR spending, and its limited utility as a means of promoting awareness of social responsibility in the corporate world.

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