CSR in India — a small write-up
Corporate Social Responsibility (CSR)
When a large factory comes up in an area, it draws heavily on local resources. Some of these are…
a. It displaces a large number of people & and renders them homeless.
b. It draws water from local rivers and lakes.
c. It acquires agricultural land depriving its owner of his livelihood.
d. It flattens the ground by cutting off trees and forests, razes old places of worship, schools and small businesses.
e. It poisons the air by emitting gases and smoke, and pollutes the rivers and water bodies by discharging effluents.
In other words, it damages the environment irreversibly, and causes great hardship to local people. The company, however, makes large profits.
Even in case of non-manufacturing companies such as IT firms, trading houses, banks insurance companies etc. it can be said that they owe a lot to local resources. The man power they recruit to run their businesses are all educated and trained by educational institutions that are either run or aided by government. So, they owe their success to the local communities in no small measure.
In view of the above, it becomes incumbent on the corporate to pay back to the society at least a small part of the gains they make by using public resources.
Some companies do it willingly, while some others do it when compelled by law. The corporates do it in so many ways. They give employment to local people, build hospitals and schools, run day care centres, conduct health awareness campaigns, promote sports competitions etc.
Some of the the companies who do commendable work with regard to CSR are the Tatas, Wipro, Infosys, Vedanta, Hindustan Lever, Hindustan Steel, Coal India, NMDC, Aditya Birla group, Indian Oil Corporation etc.
Corporate Social Responsibility (CSR) in no more a voluntary obligation. It has been give legal foundation through legislation. The Companies Act, 2013, stipulates that any company having
a. a net worth of Rs. 500 crore or more or
b. a turnover of Rs. 1,000 crore or more or
c. a net profit of Rs. 5 crore or more
should mandatorily spend at least 2% of last 3 years average net profits on CSR activities. Thus, we are going to see more of CSR related work of corporate in the years to come.
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