Companies based in Gujarat are quite conscious of their corporate social responsibility (CSR). Nearly 56% of the state’s companies have spent 2% or more of their net profits on CSR activities in fiscal 2015.
As per data provided by the CRISIL Foundation, as many as 95 companies in Gujarat reported expenditures on CSR in their annual reports. Out of these 53 firms spent 2% or more, while remaining companies failed to do so.
Across the country, 1,300 listed companies figure under the ‘Mandatory CSR spend’ criteria and 75% of them spent less than 2%. Cumulatively these companies have spent Rs 6,800 crore on CSR activities.
As per the new rules regarding CSR in the Companies Act, 2013, all corporate firms having a net worth of Rs 500 crore or more, or turnover of Rs 1,000 crore or more or a net profit of Rs 5 crore or more during any financial year are required to spend at least 2% of three preceding years’ average net profit.
Companies that have recorded a CSR spending of 2% or more include Adani Enterprises Ltd, Adani Ports and Special Economic Zones, Cadila Healthcare, Torrent Power and Torrent Pharma and Arvind Ltd, to name a few.
“Companies in industrialised states such as Gujarat, Tamil Nadu and Maharashtra have performed well in terms of CSR spending,” states a CRISIL Foundation report.
Analysis of top Gujarat firms’ annual reports shows that health and education topped the list of sectors for these companies’ CSR activities. Other sectors where these companies have taken up CSR are empowerment of women, sustainable livelihood and rural infrastructure.
“On the ground, Gujarat companies have done a lot on the CSR front. I personally believe that they spend more than 3% of their net profit if we consider contributions made by them to sectors such as religious as well as towards creating educational, housing and health facilities for their respective employees. However, these sectors are not included in CSR activities under the Companies Act,” said Sunil Parekh, a city-based industrial expert.
This article was taken from here.