1. Corporate Social Responsibility: A Snapshot
National Seminar on Managing Business with Human Values: Challenges and Measures
Corporate Social Responsibility: A Snapshot
Pankaj Jain
Founder and CEO
IRE CFO Services LLP
(A Jain Ventures Initiative) 📞 📩
irecfo.com
IPEM Program

2. The information contained herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavor to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act on such information without appropriate professional advice after a thorough examination of the particular situation and we will not be responsible in any circumstances, whatsoever.

3. Discussion Points India – Key Socio Economic Facts
Corporate Social Responsibility (CSR) Pyramid
CSR in India - Some Ground Realties
Relevance of CSR for Companies
National Voluntary Guidelines for CSR
SEBI Guidelines for Business Responsibility Reporting
Duties of Board of Directors
Functioning Mechanism of CSR Committee
CSR Spending and Emerging Trends in Responsible Business

4. India – Key Socio Economic Facts
India was 7th largest economy worldwide in India's economy is expected to overtake that of Britain and France to become the fifth largest in the world in dollar terms in next few years, and third largest by Therefore, India is important player as emerging global leader in terms of economic growth.
However, on social front India is legging behind as nearly 27.5 % of India’s population still lives below the poverty line and 38.4% of children under five in India are undernourished, while 51.4% of women in reproductive ages are anemic.
=> What emerges from above two perspectives is a picture of uneven distribution of the benefits of growth which many believe, is the root cause of social unrest in our country. In this context, Social Responsibility becomes utmost important for every citizen and more so for Corporate Citizens.

6. CSR In India – Some Ground Realties.1
CSR in India has traditionally been seen as a philanthropic activity.
The practice of CSR in India still remains within the philanthropic space, but now it has moved from institutional building like educational, research and cultural to community development related areas and activities through various projects.
It is now getting more strategic in nature (that is, getting linked with business) than philanthropic, and a large number of companies are reporting the activities they are undertaking in this space in their official websites, annual reports, sustainability reports and even publishing CSR reports.

7. CSR In India – Some Ground Realties.2
The Companies Act, 2013 has introduced the idea of CSR to the forefront and through its disclose-or-explain mandate, is promoting greater emphasis, transparency and disclosure.
The CSR is applicable to companies with an annual turnover of 1,000 crore INR and more, or a net worth of 500 crore INR and more, or a net profit of five crore INR and more. The new rules, which are applicable from the fiscal year onwards also require companies to set-up a CSR committee consisting of their board members, including at least one independent director.

8. CSR In India – Some Ground Realties.3
Companies to spend at least 2% of their average net profit in the previous three years on CSR activities
India is the first country in the world to enshrine corporate sector for social responsibility through enforcement of law.
If the company did not spend CSR, it has to explain the reasons for not spending in its annual report.
=> Non-disclosure or absence of the details will lead to penalty from Rs. 50,000 to Rs. 25 lakh or even imprisonment of up to 3 years

9. Relevance of CSR for Companies
CSR is not only relevant because of a changing policy environment but also due to its ability to meet business objectives and being socially responsible can have host of benefits for the companies such as:
Strengthening relationship with all stakeholders
Enabling continuous improvement and encouraging innovation
Attracting the best industry talent as a socially responsible company
Risk mitigation due to effective corporate governance framework
Enhanced ability to manage stakeholder expectations
These benefits are important and most companies that are engaged in CSR, are revisiting their strategies and expanding their operations to reap enhanced benefits for contributing towards inclusive growth.

10. National Voluntary Guidelines.1
National Voluntary Guidelines (NVGs) on Social, Environmental and Economic Responsibilities of Business, have been laid down by the Ministry of Corporate Affairs. These are applicable to all businesses irrespective of size, sector or location. The nine principles of National Voluntary Guidelines are: Principle 1: Businesses should conduct and govern themselves with ethics, transparency and accountability. Principle 2: Businesses should provide goods and services that are safe and contribute to sustainability throughout their life cycle. Principle 3: Businesses should promote the wellbeing of all employees. .

11. National Voluntary Guidelines.2
Principle 4: Businesses should respect the interests of, and be responsive toward all stakeholders, especially those who are disadvantaged, vulnerable and marginalized. Principle 5: Businesses should respect and promote human rights. Principle 6: Business should respect, protect, and make efforts to restore the environment. Principle 7: Business when engaged in influencing public and regulatory policy, should do in responsible manner.

12. National Voluntary Guidelines.3
Principle 8: Businesses should support inclusive growth and equitable development. Principle 9: Businesses should engage with and provide value to their customers and consumers in a responsible manner. => These guidelines are based on 3P Model i.e. the business should engage itself for the interests of People, Planet and Profits.

13. SEBI Guidelines for Business Responsibility Reporting
SEBI has issued a circular on 13 August 2012 mandating top 100 listed companies to report their ESG initiatives in their annual report by way of Business Responsibility Report (BRR) describing initiatives taken by the listed entity from an Environmental, Social and Governance perspective, in the format as specified by the Board.
The BRR requires companies to report their performance on the nine NVG principles.
Other listed companies have also been encouraged by SEBI to voluntarily disclose information on their ESG performance in the BRR format.

14. Format of Business Responsibility Report

15. Duties of Board of Directors for CSR
Board of Directors will
Approve CSR Policy
Ensure implementation of CSR policy
Disclose the contents of CSR policy in the Board report
Place the same on company’s website, if any
Ensure CSR spending amounting to at least 2% of the average net profit of the preceding three financial years
Board’s Report shall specify the reasons for not spending the specified amount
=>There is no penalty for failure to spend 2% of net profit on CSR

16. Functioning Mechanism of CSR Committee

20. Emerging Trends in Responsible Business
Regular discussions on ‘Responsible Business’ in business forums
CSR embedded in organizational structure
Incorporating best global practices
Proactive government – Guidelines & directives
Partnerships between government, corporate and civil society
CSR and Sustainability are becoming criteria for performance evaluation for public sector companies

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Let us Explore Possibilities
Pankaj Jain
Founder and CEO
IRE CFO Services LLP
(A Jain Ventures Initiative) 📞 📩
irecfo.com
IRECFO is team of diverse professionals having rich and strong multi-dimensional experience of Real Estate Business while working at Top Corporate Level positions with unique competency of taking Deep Dive into such complex matters having multi-level cascading long term impacts on Real Estate Business. We are providing End to End Customized solutions in RERA / IBC related matters with in depth analysis on business operations and are closely working with many leading developers, on all sizes of Real Estate projects, to resolve such issues.