India’s top 100 companies spent nearly a billion dollars on corporate social responsibility in the last financial year, more than double of what they had spent three years ago.
A study of BSE 100 companies by Institutional Investor Advisory Services Ltd. revealed that CSR spends rose 25 percent in 2015-16 to Rs 6,500 crore over the previous financial year.
That compared with Rs 3,000 crore in 2012-13, before the ‘comply or explain’ regulation was brought in as part of the Companies Act, 2013, said Amit Tandon, MD and founder, IiAS.
State-owned companies’ CSR spends rose 41 percent in the last financial year, said the report.
Under the Companies Act, firms are required to spend 2 percent of their average three-year profits on corporate social responsibility. This amounts to Rs 7,600 crore for the BSE 100 companies. The report said 46 companies complied with the requirement fully, with BSE 100 companies together spending 86 percent of the limit.
Nearly 48 companies used CSR to spend on themes aligned to their businesses, according to the report.
Themes For CSR
Education: Rs 2,030 crore
Hunger/Healthcare/Poverty Alleviation: Rs 1,960 crore
Rural development: Rs 1,000 crore
Environment: Rs 430 crore
Swacch Bharat: Rs 360 crore
Top CSR Spenders
Energy companies were the biggest CSR spenders in the last financial year at Rs 2,170 crore, followed by mines and metals at Rs 740 crore and bank and non-banking financial companies at Rs 130 crore.
Amit Tandon said 59 companies studied impact assessment of their CSR spends. Boards are now spending time on how the money is being used, while some companies make detailed disclosures. There is room for more rigour and discipline, said Tandon.
This article was taken from here.