CSR, Public sector, Six women-led companies,State Bank of India, Axis Bank Ltd, ICICI Bank Ltd, Hindustan Petroleum Corporation Ltd, LIC Housing Finance, Apollo Hospitals Ltd
GN Bureau | September 28, 2015
They have been part of promoting social values for the last five years but still the public sector companies’ show less satisfactory progress than private sector companies when it comes to corporate social responsibility (CSR). Since 2010, public companies have been spending anywhere between 0.5% and 5% of net profits as per as the guidelines issued by department of public enterprises.
However, the public sector spent just above 16% of half their funds (only 66.7%) of what they had to spend in the year ended March 31 while private companies contribution is just 18% short of full CSR budget spending (82% of mandatory spending).
According to showed data compiled by NextGen, a CSR management firm, that the 19 public sector unit (PSU) companies spent Rs.1,686 crore FY15, while 66 private companies spent Rs.3,307 crore. It is based on the data was collected till September 14.
The data also shows that women-led companies had a better rate of meeting the 2% spending target. Six women-led companies (State Bank of India, Axis Bank Ltd, ICICI Bank Ltd, Hindustan Petroleum Corporation Ltd, LIC Housing Finance, Apollo Hospitals Ltd) saw their CSR spending reach 90.5%.
The data says that only 33 of the 85 companies spent the entire 2% of their profits or more on CSR while 52 did not meet the target in the first year.
The companies have to mandatorily disclose the reasons why they failed to meet the 2% target. The most common reason that companies cited for not meeting the target is that they had undertaken long-term projects. This means that the amount has been earmarked for a long-term initiative. Many companies also said that they lacked prior expertise and delay in project identification as reasons for not spending.
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