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What the CSR numbers don’t tell
As per the NGO Box October 2015 India CSR outlook, which is an informative analysis of 460 companies and the spends of 250 Companies, who together had a corporate social responsibility requirement of Rs. 7,040 crore in 2014-15, onlyRs. 5,563 crore was actually spent. This is up by only 13.8 per centcompared with the previous year, when there was no mandate prescribing how much a company was to spend on CSR.
This is about a fifth of estimates that have ranged anywhere from Rs. 25,000 crore upwards, that ‘experts’ and media have been talking aboutever since the Companies Act, 2013 came into force in April 2014. Maharashtra receives the highest spends, in the range of Rs. 1,000 crore, or 18 per cent. It also has the highest number of farmer suicides! Incidentally, many of India’s millionaires also reside in Mumbai. Maharashtra is followed by Rajasthan, which receives about Rs 500 crore, or 10 per cent, and Karnataka, which gets Rs. 400 crore, roughly 8 per cent.
What does all this mean for the country, in the overall context of giving? According to Venkat Krishnan of Give India, India’s largest online giving portal, all the giving put together is presently about 0.4 per cent of the GDP. Even with the new mandate of 2 per cent - if we were to indeed become 2 per cent - as a percentage of total giving,it would be less than a tenth of what the government spends on welfare.
The Governor of the Reserve Bank of India, Dr.Raghuram G.Rajan in his address at the Institute of Rural Management, Anand on November 25, 2014, said that write-offs on large loans by commercial banks to some corporate houses were in the range of Rs. 161,018 crore, about 1.27 per cent of GDP. This would have allowed 1.5 million of the poorest children to get a full university degree with all expenses paid, even in a private university. “Wilful defaulters should not be lionised as captains of industry, but as freeloaders on a hardworking people” he said.
It’s time we had an informed debate, minus the hype and hysteria and placed the dialogue within the realm of responsible business practises instead of CSR spends.
The India Responsible Business Forum (IRBF) Index 2015 is an initiative by Oxfam India in partnership with Corporate Responsibility Watch, Praxis and Partners in Change, non-profits which look at corporate accountability and business responsibility.
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