The Companies Act mandates spending on CSR activities by the companies
Jasleen Kaur | October 24, 2016 | New Delhi
The spending under the corporate social responsibility (CSR) by the NSE listed companies has seen a huge increase of 28% in 2015-16. The Companies Act (2013) has statutory provisions, making the CSR mandatory for companies with net worth of Rs 500 crore or more, turnover of at least Rs 1,000 crore and net profit of at least Rs 5 crore are required to spend at least 2 percent of their average net profits of last 3 years on CSR activities, while constituting a separate committee on their board. The law, implemented from April 2014, makes India the only country with legislated CSR.
There are 1,579 companies listed on NSE, 1,520 companies were listed during 2015-16 (balance 59 have got listed subsequent to April 2016). Out of 1,520 companies, annual reports for 2015-16 have been released by 1,421 companies.
Of these 1,421 companies, 1,332 had details relating to CSR given in the annual reports, while no such details were available for the rest of the 89 companies.
Of the 1,332 companies, 920 were applicable under the provisions of CSR in the Companies Act, up from 895 companies in 2014-15. The analysis is thus based on the data of 920 companies.
According to Prime Database, which compiles data on capital markets and related matters, which has done analysis of this data - the average net profit of these 920 companies over last 3 years was Rs 4.60 lakh crore. As per the CSR provision, the companies were required to spend Rs 9,146 crore. The companies, however, went one step further and spent Rs 9,309 crore, Rs 163 crore more than the requirement.
However, Rs 1,984 crore remain unspent and the final actual CSR expenditure by these companies was Rs 8,345 crore. This is an increase of 28 percent from Rs 6,526 crore spent in 2014-15.
The data shows that the maximum spending of CSR by the companies has been on the education sector, followed by Healthcare.
In comparison to previous year, CSR spending as contribution to PMs funds saw the maximum increase by 418% from Rs 168 crore in 2014-15 to Rs 701 crore in 2015-16. This was followed by spending on hunger/poverty (66% increase) and gender equality (38 %). Meanwhile, spending on child mortality and maternal health saw the maximum fall with 22 %. According to Pranav Haldea, allocation as a percent of total under different schedules though remained fairly constant.
According to data the top 10 companies in terms of CSR spend are
|Rank||Company||CSR expenditure (Rs.cr)|
|1||RELIANCE INDUSTRIES LTD.||651.57|
|3||OIL & NATURAL GAS CORP.LTD.||409.01|
|4||TATA CONSULTANCY SERVICES LTD.||294.23|
|7||TATA STEEL LTD.||204.46|
|9||POWER FINANCE CORP.LTD.||196.88|
|10||ICICI BANK LTD.||171.51|
|Company||Prescribed CSR expenditure (Rs.cr)||Actual CSR expenditure (Rs.cr)||Excess spend (Rs.cr)|
|RELIANCE INDUSTRIES LTD.||557.78||651.57||93.79|
|TVS MOTOR CO.LTD.||7.15||78.26||71.11|
|TATA STEEL LTD.||150.00||204.46||54.46|
|COAL INDIA LTD.||19.69||73.26||53.57|
|GUJARAT MINERAL DEVELOPMENT CORP.LTD.||14.47||66.03||51.56|
|POWER FINANCE CORP.LTD.||145.79||196.88||51.09|
|NLC INDIA LTD.||44.27||81.93||37.66|
|STEEL AUTHORITY OF INDIA LTD.||57.20||76.16||18.96|
|Company||Prescribed CSR expenditure (Rs.cr)||Actual CSR expenditure (Rs.cr)||Unspent Amount (Rs.cr)|
|OIL & NATURAL GAS CORP.LTD.||593.70||409.01||184.69|
|BHARTI AIRTEL LTD.||189.00||43.94||145.06|
|HCL TECHNOLOGIES LTD.||144.63||14.16||130.47|
|HDFC BANK LTD.||248.00||127.28||120.72|
|HINDUSTAN ZINC LTD.||170.05||63.26||106.79|
|TATA CONSULTANCY SERVICES LTD.||360.00||294.23||65.77|
|CAIRN INDIA LTD.||107.21||51.50||55.71|
|HOUSING DEVELOPMENT FINANCE CORP.LTD.||139.26||85.70||53.56|
|BHARAT HEAVY ELECTRICALS LTD.||110.03||66.20||43.83|
According to Haldea, PSU spending saw a huge increase of 41 % from previous year. The 48 PSUs spent Rs 2,078 crore in 2014-15. Whereas, 47 PSUs spent Rs 2,936 crore in 2015-16.
The CSR Act also mandates companies to appoint a CSR committee comprising at least 3 members of the board of which at least 1 should be independent. 1197 out of 1520 companies had such a CSR committee in place. Several companies though went beyond the requirement. According to Haldea, as many as 331 companies had appointed more than 3 members.
The USA declaring Hizbul Mujahideen chief Syed Salahuddin as a specially designated global terrorist may not take the sting out of terrorists’ plans in Kashmir immediately but it has given a huge setback to Kashmiri separatists who had always hoped for American intervention in the Indo-Pak standoff o
Vani Jairam’s childhood dream of becoming a playback singer was realised when veteran film music composer Vasant Desai gave her the opportunity to sing Bole Re Papi Hara and two other songs in the movie Guddi. After that, the multilingual singer went on to sing for eminent music per
Should there be death penalty for those involved in lynching?
On May 23 this year, the ministry of environment issued ‘Rules on prevention of cruelty to animals (regulation of livestock market)’ with the purported aim of regulating animal markets. When one reads the rules – notwithstanding the lame efforts from union ministers to issue clarificati
BEML, a mini ratna category-1 enterprise of the defence ministry, has set a target of using 100 percent renewable energy for its own consumption. In this connection, BEML’s 9 MW Windmill Park installed at Bagalkot District in Karnataka was recently
Bharat Heavy Electricals Limited (BHEL), a Maharatna enterprise, has recorded nearly 14 percent growth in its intellectual capital in 2016-17 fiscal. During the year, a record 508 patents and copyrights were filed by the company, translating into filing of nearly two patents/copyrights