Govt amends CSR norms, corona fight to ‘get boost’

New Delhi, Aug. 25: The government has amended the corporate social responsibility rules under the companies law that is likely to help boost funding for developing new vaccines, drugs and medical devices related to the coronavirus pandemic.

With the latest amendments, companies engaged in research and development (R&D) activity of new vaccine, drugs and medical devices in their normal course of business have been allowed to undertake R&D activity of new vaccine, drugs and medical devices related to Covid-19 under the CSR ambit.

This would be applicable for three financial years — 2020-21, 2021-22 and 2022-23 — subject to certain conditions. This means that money spent on such activities would be considered as Corporate Social Responsibility (CSR) spending under the Companies Act, 2013.

Under the Act, certain categories of profitable companies are required to shell out at least 2 per cent of their three-year annual average net profit towards CSR activities in a particular financial year.

The corporate affairs ministry, which is implementing the Act, issued two notifications related to

CSR on August 24.

Changes have been made to Schedule VII of the Act that pertains to CSR activities. Now, contributions to incubators or R&D projects in the field of science, technology, engineering and medicine, funded by the central or state governments or public sector undertaking or any agency of the central or state government would be considered as CSR.

Contributions to public funded universities, Indian Institutes of Technology (IITs), national laboratories would also come under the CSR ambit, according to a notification.