Proactive Rather Than Reactive CSR Efforts Needed

Taxi aggregator Uber declared a weeklong (2 to 7 May) initiative to collect funds for drought relief. About Rs.2.75 lakh was collected and passed on to not-for-profit World Vision India, which will provide dry rations and water to more than 100 affected households in Maharashtra. These are just two among many such corporate initiatives in Maharashtra but, in effect, they are little more than band-aid solutions. “There is increased interest by firms and individuals who want to help, but it is not the surge I would have expected given the scale and intensity of the drought distress,” says Zarina Screwvala, founder and managing trustee of the Swades Foundation, a not-for-profit working in the state.

According to her, the overall problem is so large that it’s not just water conservation that needs to be addressed when fighting drought. “Each region has its own unique geographical, topographical, social and political aspects.

To tackle the drought, one needs to have a 360-degree approach,” she adds. Echoing the view, Amrit Pandurangi, partner and leader of infrastructure and capital projects at Deloitte Touche Tohmatsu India Llp, points out, “One of the key concerns is that we are still in a ‘reactive’ mode rather than taking proactive action towards water sustainability. People conserve water only if there is an acute scarcity, usually in the summers, and then it’s business as usual.” “Sending water trains only reflects how poor our water management is,” he said. “It is not a bad idea to allot CSR (corporate social responsibility) funds to water conservation. But nothing can substitute state funding… CSR funds can only supplement state funding.” The CSR rules as defined in Section 135 of the Companies Act direct firms with a net worth of Rs.500 crore or revenue of Rs.1,000 crore or net profit of Rs.5 crore to spend 2% of their average profit in the past three years on social development-related activities listed in Schedule VII of the Rules.

In FY15, Maharashtra was the highest recipient of CSR funds in the first year of implementation of the CSR Rules—Rs.680.14 crore. Of the top 100 NSE-listed companies, 47 are registered in Maharashtra. As per an analysis by NextGen, a CSR consultancy firm, based on the annual reports of these companies, they together spent Rs.2,571.10 crore on CSR in FY15, just short of the prescribed amount of Rs.2,888.73 crore. But, despite 52% of Maharashtra being drought-prone, only a minuscule part of the CSR funds was spent on water conservation, with NextGen pegging the figure at about Rs.1.44 crore. This number was arrived at by taking into account only that expenditure that firms specified as being for the state and for water-related initiatives. To be sure, water conservation is not defined as a separate category in Schedule VII of the CSR Rules and FY15, being the first year of their operation, saw many variations in reporting by companies. The Maharashtra government’s Jalyukt Shivar Abhiyan, an integrated programme to address the deeper causes of drought in the state and find long-term solutions launched in 2014, has also received lukewarm response from corporates. The scheme was intended to make 5,000 villages water secure every year and make the state drought-free by 2019. “Companies are working independently and a majority of the funds are being given to the chief minister’s relief fund, from where they get distributed to various government drought relief efforts,” says Vinod Wakhare, deputy secretary, water conservation department, and head of the Jalyukta Shivar Abhiyan, by way of an explanation for why the scheme has found few takers. Wakhare’s department has no data regarding CSR contributions to the scheme. A few corporates such as Volkswagen India did pitch in. In an email interview, Andreas Lauermann, president and managing director of Volkswagen India Pvt. Ltd, said that the company undertook a project in Naiphad last year, which was handed over to the gram panchayat on 16 April after an investment of approximately Rs.51 lakh.

The project focused on desilting and rejuvenating existing water bodies to increase their storage capacity as well as increase water percolation.

Godrej Industries chose to deploy its CSR funds for water conservation in partnership with the government-owned National Bank for Agriculture and Rural Development. Its 1,000-hectare watershed programme in Beed district got underway last year.

The initiative is a shift from the company’s traditional approach of working towards sustainability within its manufacturing systems and relief work with local communities on a need-basis, says Vikas Goswami, head of the good and green campaign of Godrej Industries. It will spend between Rs.70 lakh to Rs.1 crore on the programme. There are several companies that prefer to work on water conservation through their philanthropic arms.

The Bajaj group, through its philanthropic arms—Kamalnayan Jamnalal Bajaj Foundation and Jamnalal Kaniram Bajaj Trust—has worked to revive 210km of small streams and seasonal rivers in the Wardha region of Maharashtra. According to Haribhai Mori, who heads the CSR initiatives of the Bajaj group of companies, it costs Rs.10 lakh to revive a 1km stretch of a stream/rivulet.

Ambuja Cement too is working on water conservation in Maharashtra through its philanthropic arm Ambuja Cement Foundation. It has built 80 check dams in the Chanderpur area of the state at a cost of Rs.50 lakh. “We recognize the severity of the situation and that is why over 25% of the total CSR funds received by the foundation is spent on water conservation efforts across India,” said Pearl Tiwari, head of the foundation. Consumer goods giant Hindustan Unilever Ltd (HUL) too works in the field of water conservation through its philanthropic arm Hindustan Unilever Foundation.

In an email response, Ravi Puranik, CEO of the foundation, said the company has a partnership with the Watershed Organisation Trust (WOTR) across 75 villages of Jalna district in Maharashtra. “The soil and moisture conservation work carried out till March via the project will be able to harvest more than 8,500 million litres of rainwater in the area,” Puranik said, refusing to reveal details of the funds deployed on the project. HUL’s annual report for 2014-15 suggests that water conservation projects, as part of CSR activities across India, received Rs.2,112 lakh up to March 2015. CSR apart, activists stress the importance of water conservation within firms.

Citing the example of the state government’s circular issued to all sugar mills in April, which asks them to donate Rs.10 lakh to the CM’s drought relief fund, Parineeta Dandekar, a Pune-based ecologist said, “CSR or drought relief measures cannot be used as an excuse to let industry off the hook regarding the water stress in the state—of which industry is a major contributor.” With increasing water scarcity, it is necessary that companies, not-for-profits and government agencies look at drought proofing and not mere relief work. “Governments/water departments should draw up and implement plans for effective water utilization, involving the private sector and taking innovations on board.

These efforts should go on year round and not only during the crisis months,” said Pandurangi. Harish Ithape of the Naam Foundation, a not-for-profit set up by actor Nana Patekar to work on farmer assistance in Maharashtra, agrees. “Money cannot create water. Infrastructure along with behavioural change is needed to increase water availability,” he says. Ithape believes that along with measures like increasing water storage through check dams, rejuvenating streams, ponds, etc., there should be efforts to optimize water-use. “This is only possible if those wanting to help take up long-term projects and involve local communities,” he adds.