In September last year, government had set up an 11-member high-level panel to review the existing framework, guide and formulate the roadmap for a coherent policy on Corporate Social Responsibility (CSR) activities under the companies law.
Now in a latest after six months of setting up the panel, the panel is likely to suggest tweaks and widen the definition of CSR , which would allow funding to all incubators to be counted towards CSR spend, reported Economic Times citing government officials aware to the development.
The suggestion is made by the Department for Promotion of Industry and Internal Trade (DPIIT), formerly DIPP.
Currently, contributions or funds provided to technology incubators qualify as CSR only if it is located within academic institutions and approved by the government. If the suggestion by the panel incorporated then funding to all the technology/ startup incubators in the country will qualify for CSR spending.
Only about Rs 54 crore was spent on technology incubators under CSR during 2014-17, which is meagre compared to spend on education, at Rs 10,651 crore, and healthcare, at Rs 6,671 crore.
The panel is also expected to look at other changes based on stakeholder feedback. and experience. The report is expected soon and could be taken up for implementation post elections.
Corporate social responsibility (CSR) is a company’s efforts to improve society in some way or other that contributes to sustainable development by delivering economic, social and environmental benefits for all stakeholders.
In 2013, India enacted Section 135 of the Indian Companies Act that requires large companies to spend at least 2% of their profits every year on CSR. The bill applies to companies with an average net profit of at least 50 million rupees (approximately $816,000 USD) over a period of three years.
While many corporate houses like Tata group, Pepsico and others have been traditionally engaged in doing CSR activities voluntarily, the new CSR provisions 2013 put formal and greater responsibility on companies in India to set out clear framework and processes to ensure strict compliance.