Indian corporates spent Rs 8,691 crore on corporate social responsibility (CSR) during the current financial year as per a survey.
KPMG published an analysis named ‘India CSR Reporting Survey 2019’ depicting the rise in CSR spending by India Inc year-on-year. Report shows that CSR has become a Board agenda and gained the attention of the high-positioned dignitaries to create an impact. Around 65% of CSR committees include the CEOs which indicate how companies are going beyond the demands of the Act.
In 2014-15 CSR spending was 5115 crore and now it has proliferated. It’s been five years since India passed the CSR Act, the Section 135 of the Companies Act, 2013. It encompasses all companies with a net worth of Rs 500 crore, or revenues more than Rs 1,000 crore, or net profit exceeding Rs 5 crore, to spend 2% of their average profit over the last three years on CSR programmes. If they fall short, they have to specify the reason for inability to spend. It encourages corporates to work closely with the social sector.
Around 76% of companies as compared to 38% in 2014-15 stated that they spend at least 2% of profits for CSR. Firms have started formalising their social impact strategies. They are establishing new CSR departments and formalising the processes.
While the overall CSR spending is increasing, the governance indicators have also displayed steady improvement around CSR over the years. The indicators represent the working of the CSR committee and its diversity.
Annually around 30% of the companies have more than three CSR committee meetings and 41% of companies have aligned CSR projects to Sustainable Development Goals (SDGs).