by Dr Poornima M Charantimath
Corporate Social Responsibility (CSR) makes the business socially responsible in how it impacts the environment, serves the community or helps create a better world. The Ministry of Corporate Affairs has notified Section 135 and Schedule VII of the Companies Act 2013 which came into effect on April 1, 2014, mandates companies to formulate a CSR policy and incur a given minimum expenditure on social activities. The new paradigm allows the companies to look into CSR as a strategic vision of the organization, which throws up both challenges and opportunity.
CSR has been defined as the “Commitment of business to contribute to sustainable economic development working with employees, their families, the local community, and society at large to improve their quality of life, in ways that are both good for business and good for development”.
How will the requirement be enforced?
The act requires that companies set up a CSR board committee, which must consist of at least three directors, one of whom must be independent. The board committee is responsible for reviewing, approving, and validating the company’s investments in CSR. The board’s independent director helps ensure the credibility of this process.
The committee must ensure that the company spends “at least 2 percent of the average net profits of the company made during the three immediately preceding financial years” on CSR activities.
CSR Impact: According to Government of India estimates about 8,000 firms would contribute Rs 12,000-15,000 crore for CSR activities under the Companies Act 2013.
[email protected]: A Case Study of Polyhydron Foundation
Polyhydron Foundation was incorporated in 2012 to support initiatives in health, education and welfare. The benefits of the Foundation shall be open to all irrespective of cast, creed or religion. All the members of the Foundation shall strive to achieve above objects with ethical and selfless commitment.
a. To contribute to the economic development while improving the quality of life of industrial workers and staff, their families as well as of local community and society at large.
b. To impart industrial and computer training, provide scholarships to children of industrial workers and staff.
c. To focus on and contribute to the improvement of health, income, education, employment and quality of life of the general public.
d. Sponsor community projects which enhance the quality of life.
e. To work for rural / tribal society to improve the quality of their life.
f. To focus on under-privileged children and help them to transform their lives through good education.
g. To improve healthcare infrastructure and help children from underprivileged section of the society to gain access to primary healthcare.
h. Encourage underprivileged people participating in sports by giving them honorarium, helping them to participate in District / State / National / International Level competitions.
i. To create an awareness among the corporates about their social responsibilities.
j. To take part in events which are aimed at the betterment of the society.
k. To help, contribute for a cleaner environment and a better society through active interaction and participation.
1. Leadership Adoption Program (LEAP):
Leap provides an opportunity to the children of under privileged community to learn LIFE SKILL i.e. ability for adaptive and positive behaviour that enable individuals to deal effectively with the demands and challenges of everyday life. It provides training to students in the areas beyond academics. M/s. People Pro Belgaum provides training to students of Machhe High School, Machhe, Belgaum.
2. Assistance to Sportsmen
To encourage Body Builders and Swimmers of Belgaum for taking part in competitions at different levels (District, State, National & International level) Polyhydron Foundation provides financial assistance.
3. Preventive Health programs:
Polyhydron Foundation sponsors Medical Expenses at Health Camps conducted by M/s. Arogya Foundation in villages of Khanapur Taluka of Belgaum District.
About the Author: Dr Poornima M Charantimath, is Professor at KLS IMER, Belgaum.
K LS IMER, BELGAUM is organisging a Workshop of Corporate Social Responsibility (CSR) on 27th September, 2014 for details contact KLS IMER or [email protected].