If you like this article then please like us on Facebook so that you can get our updates in future ……….and subscribe to our mailing list ” freely “
Corporate Social Responsibility
As per the explanation given by Cambridge dictionary Corporate Social Responsibility means the idea that a company should be interested in and willing to help society and the environment as well as be concerned about the products and profits it makes. Corporate social responsibility can be referred to as “corporate citizenship” and can involve incurring short-term costs that do not provide an immediate financial benefit to the company, but instead promote positive social and environmental change. CSR in India has traditionally been seen as a philanthropic activity. And in keeping with the Indian tradition, it was an activity that was performed but not deliberated. As a result, there is limited documentation on specific activities related to this concept. However, what was clearly evident that much of this had a national character encapsulated within it, whether it was endowing institutions to actively participating in India’s freedom movement, and embedded in the idea of trusteeship. The Companies Act, 2013 has introduced the idea of CSR to the forefront and through its disclose or explain mandate, is promoting greater transparency and disclosure. Schedule VII of the Act, which lists out the CSR activities, suggests communities to be the focal point. On the other hand, by discussing a company’s relationship to its stakeholders and integrating CSR into its core operations, the draft rules suggest that CSR needs to go beyond communities and beyond the concept of philanthropy. It will be interesting to observe the ways in which this will translate into action at the ground level, and how the understanding of CSR is set to undergo a change.
CSR activities shall include:
eradication of hunger and poverty, promotion of education, promoting gender equality and women empowerment, reducing child mortality and improving maternal health, combating human immuno deficiency virus(HIV), acquired immune deficiency syndrome (AIDS), malaria and other diseases, ensuring environmental sustainability,employment enhancing vocational skills, social business projects, contribution to the Prime Minister’s National Relief Fund.
Statutory obligation :
Considered first of its kind, the new legislation requires certain class of companies to spend at least 2% of their 3 years average annual net profit towards CSR activities. Companies having net worth of at least Rs 500 crore or having minimum turnover of Rs1,000 crore or those with at least net profit of Rs 5 crore, have to make CSR contribution. The first company that comes to mind as a beacon of good corporate governance is the Indian IT industry bellwether, Infosys. Indeed, Infosys is one of the companies that has set benchmarks for other companies not only in India but all over the world in the way corporate governance and social responsibility are handled and projected to the outside world Infosys’ commitment to giving back can be gauged by the fact that the company became one of the first in the country to abide by the new stricture of spending 2% of their average net profit on Corporate Social Responsibility (CSR) activities. On July 11 this year, Infosys donated Rs 240 crore this fiscal to its philanthropic arm, Infosys Foundation. Set up in 1996, the non-profit trust works across sectors, including healthcare, education, culture, destitute care and rural development. Recommended Articles
AS 5 Net Profit or Loss for the Period, Prior Period ItemsAccounting Standard 15: Accounting for Retirement BenefitsEarning Per Share Complete Guide with DefinitionAccounting standard 2, Inventory valuationAS 1 Disclosure of Accounting Policies
