Business Other News 06 Nov 2016 Corporate Affairs Mi ...

Corporate Affairs Ministry to hold sensitisation workshops on CSR norms

PTI
Published Nov 6, 2016, 2:08 pm IST
Updated Nov 6, 2016, 2:17 pm IST
The move comes against the backdrop of instances of discrepancies in data and lapses being noticed by the Ministry with regard to CSR rules.
Arjun Ram Meghwal
 Arjun Ram Meghwal

New Delhi: To ensure better compliance, the Corporate Affairs Ministry plans to conduct workshops for officials and other stakeholders to sensitise them about social welfare spending norms under the companies law.

The move comes against the backdrop of instances of discrepancies in data and lapses being noticed by the Ministry with regard to compliance with CSR rules for the financial year 2014-15 -- when these norms came into effect.

 

Under the Companies Act, 2013 -- implemented by the Ministry -- certain class of profitable entities are required to shell out at least two per cent of three-year annual average net profit towards Corporate Social Responsibility (CSR) activities. In case of non-spending, then they have to provide reasons for the same.

Sources said there have been instances of requisite forms related to CSR spending not being filled properly, making it even difficult to understand whether the companies concerned comes under the CSR ambit or not.

The Ministry is facing problems in compiling the data and it has been decided to conduct "sensitisation workshops" for the stakeholders at various places across the country, they added.

According to sources, these workshops are aimed at ensuring that there is "better compliance" with CSR regulations. Earlier this year, the Ministry had asked hundreds of companies to submit details about utilisation of CSR funds after noticing discrepancies in the data submitted by many of them in their statutory filings.

A random analysis of filings had indicated discrepancies in submissions about CSR activities, with instances of firms submitting that they do not come under CSR ambit whereas financial data suggested otherwise, according to sources.

Companies having a turnover of at least Rs 1,000 crore, minimum net worth of Rs 500 crore and those having net profit of Rs 5 crore or more in a financial year are required to comply with CSR norms.

In July, the government had said that more than 1,900 companies shelled out a total of Rs 8,029 crore towards CSR activities in 2014-15 "An assessment of CSR expenditure of 4,257 companies for the year 2014-15 indicates that 116 public sector undertakings and 1,790 private sector companies together have spend Rs 8,029 crore during 2014-15," Minister of State for Corporate Affairs Arjun Ram Meghwal had said.

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