Making corporate social responsibility more meaningful
When it comes to creating impact money doesn’t always equal effectiveness. Businesses engaging with the government to support vulnerable communities is not a new concept. There are examples of corporate social responsibility (CSR) spending that date back as far as the 1800s.
In a country like ours where a mixed economy has sustained and borne the fruits of economic growth, it only seems more rational to have partners within the business community to achieve sustainable social growth.
Previously, all CSR spending was strictly voluntary in nature. But India became the first country in the world to mandate a minimum CSR spending (2% of average profits of the past three years) for corporations above a certain size. This was considered a bold move on the part of the government of India to tackle social causes and bring private sector resources to address some fundamental challenges.
The government has recognised and shared 10 major areas for spending in education, gender equity, environmental sustainability, sanitation measures, availability of safe drinking water, poverty and malnutrition, encouraging preventive healthcare, protecting our national heritage, spending for the benefit of armed force veterans and contributing to the Prime Minister’s Relief Fund – all of which provide the necessary guidance for corporates to do their bit and be part of it.
However, it is disheartening to observe that despite
THE GOVT HAS RECOGNISED AND SHARED 10 MAJOR AREAS FOR SPENDING IN EDUCATION, GENDER EQUITY, ENVIRONMENTAL SUSTAINABILITY, SANITATION MEASURES, AVAILABILITY OF SAFE DRINKING WATER, POVERTY AND MALNUTRITION
the strength companies have in making an impact in society, 460 companies have cited debatable reasons for either not spending on CSR, or for having spent less than the minimum required.
It could be true that limited potential or the understanding in taking crucial steps to formulate CSR policies have shown a slower pace of support from big and small businesses at large, but it is still early days in making sure private companies recognise the importance of societal development at all levels.
The government after having observed the reasons shared by corporates, needs to prepare a stronger monitoring mechanism and encourage partnerships within the corporate sector as well as with government and civil society. This will attract companies to invest in social and developmental programmes as they go about implementing these in full faith.