Consumer goods companies show aggressive CSR activities

Six major companies spent over Rs 300 crore in the first year of operation of new CSR rules

GN Bureau | August 20, 2015


#corporate social responsibility   #csr   #ITC   #Hindustan Unilever   #Nestle India   #Godrej   #Dabur   #emami  


The Corporate Social Responsibility (CSR) law has changed the way companies approach their activities as many old sectors do not fall under CSR categories. However, the good news is that the consumer goods companies’ share in CSR sector has risen by 57% in 2014-15.

The CSR rules, came into force on 1 April last year under the Companies Act 2013 and companies with a net worth of Rs.500 crore or more or revenue of at least Rs.1,000 crore or a net profit of Rs.5 crore in a given fiscal year should spend 2% of the profit of the last three years on CSR activities.

In the first year of implementation, six major companies ITC Ltd, Hindustan Unilever Ltd, Nestle India Ltd, Godrej Consumer Products Ltd, Dabur Ltd, Emami Ltd spent Rs.343.2 crore. Their initiatives focused mostly in health, nutrition, livelihoods and sanitation, according a report published in Mint daily.

Most noteworthy contribution is by ITC Ltd. The company has doubled its CSR spending to Rs.214 crore.

It spent on soil conservation (Rs.31.45 crore) and livelihood initiatives (Rs.28.53 crore) where it trains dairy farmers and help set up of modern milk collection networks.

However, Nestle missed meeting the 2% CSR spend and its CSR spending fall in 2014. According to its annual report, Nestle India had to spend Rs.30.7 crore in 2014, but it spent only Rs.8.5 crore. Its CSR spend fell by 64% from Rs.23.9 crore in 2013.

From Rs.8.5 crore, Nestle donated Rs.5 crore to the Swach Bharat Kosh set up by the Central Government for the promotion of sanitation and making available safe drinking water. It spent Rs.1.5 crore on raising nutritional awareness among government school children around its eight manufacturing units.

In its annual report it said: “The company has been implementing societal activities since many decades. As per the strict interpretation of the new CSR rules, some of these initiatives may not be eligible under the 2% CSR spend.” It also said it has ensured that the cumulative spend on societal activities is over 2%

The other multinational Hindustan Unilever Ltd spent Rs.82.3 crore in fiscal 2015. HUL’s CSR spend grew 40% over a year ago, and spent Rs.2.5 crore more than the 2% limit. HUL has various CSR initiatives from water conservation programmes to skill building initiatives, and some of its initiatives are also closely tied to its businesses be it the Lifebuoy hand washing programme which creates awareness about handwashing to prevent diseases, or giving micro-loans to the poor to be able to buy their water purifiers, Pureit, according to its annual report.

HUL’s highest spend was in fact towards its Project Shakti. It spent Rs.46.5 crore during the year to train rural men and women called Shaktimaan and Shakti ammas to sell the company’s products and in turn become entrepreneurs. For that, the company trains them in basic accounting, selling skills and relevant IT skills.

The highest increase in CSR spend among the six firms was seen in Godrej, as its spending rose four times to Rs.16 crore during the year. Their CSR activities include development of renewable energy and livelihood creation.

Dabur, which met its 2% target by spending Rs.14.7 crore, showed a 29% drop in CSR spend versus last year.  Many companies’ CSR spends will fall because much of what they were doing as CSR earlier won’t be considered as CSR under the new guidelines. The activities carried out by the companies should be listed in Schedule VII of Section 135 of the act.

Comments

 

Other News

Former president Ram Nath Kovind on some of his unforgettable journeys

Triumph of the Indian Republic: My Life, My Struggles By Ram Nath Kovind Rupa Publications, 400 pages, Rs 795   All our presidents so far stand out, each for a different reason. Ram Nath Kovind, the 14th president of India, from 2017 t

Uday Kotak on history, Indian economy, growth and more

Pathbreakers: How 10 Visionary Leaders Transformed India by award-winning journalists  By Sucheta Dalal and Debashis Basu Rupa Publications, 304 pages, Rs 695  

₹5,000 crore saved from suspected financial fraud

In a significant gain for citizen protection in the digital economy, the Department of Telecommunications (DoT) has helped prevent suspected cyber fraud losses of more than ₹5,000 crore through its Financial Fraud Risk Indicator (FRI) within fifteen months of its launch on May 22, 2025. This money did

Capital acquisition proposals worth Rs 1.10 lakh crore for defence forces cleared

The Defence Acquisition Council (DAC), under the chairmanship of Raksha Mantri Rajnath Singh, on Monday accorded Acceptance of Necessity (AoN), that is, in-principle administrative approval to various acquisition proposals of the defence forces at an estimated cost of about Rs 1,10,000 crore.

How Rafi, Raj Kapoor helped pave the way for a great uranium deal

There`s a certain moment in diplomacy that`s too personal to be captured in a communiqué, too small to make the front page, but more revealing than the front page. This week, prime minister Narendra Modi reached Tashkent and, amid the pomp of state visits, managed to evoke the old Bollywood tunes

Distinguishing Fish 1 and Fish 2: The pragmatism behind India’s WTO ratification

 India became the 123rd WTO member to ratify the multilateral Agreement on Fisheries subsidies (AoFS) when it deposited the Instrument of Acceptance for Phase 1 on July 20, 2026. The ratification is restricted to disciplining Illegal, Unreported and Unregulated fishing (IUU), protection for overfished

Upcoming Conferences



-->

Archives

Current Issue

Opinion

Facebook Twitter Google Plus Linkedin Subscribe Newsletter

Twitter