Retrospecting CSR in 2016
As we come to the end of another year with mixed feelings, there are various ways in which one bids adieu. Let us retrospect 2016 in the CSR sphere. The highs and lows, the anticipations, expectations from all stakeholders, aligning core business values and activities in a sustainable manner and much more.
FY 2015-16 is the second year after the 2% CSR mandate for corporates came into place under Section 135. As compared to the first year where the spend had to be met, corporates had more time to be familiarised with projects to invest in and create a long term plan for beneficiaries. The framework of working also began to see an expansion on the ground of sharing and creating values for the last unit. Individuals in the decision making process, from the public and private sectors expressed their stands and opinions too.
“There hasn’t been a dramatic development in CSR. The industry is still evolving along with the top management taking a keen interest in the financial reporting structures to where one needs to invest to utilise their complete potential. The next step forward is donor engagement and showcasing impact and reporting in a storytelling format,” said Prerana Langa, CEO, YES FOUNDATION.
For the financial year, 2014-15 as many as 460 listed firms disclosed spending Rs 6,337 crore towards CSR activities. The domain this year saw an increase in spend by 28% along with the Registrar of Companies (RoC) serving warnings to about 100 companies over non-disclosure or improper disclosure of their corporate social responsibility (CSR) spending, sending a strong signal that the government is very serious about compliance. The CSR norms require companies with at least Rs 5 crore net profit or Rs 1,000 crore turnover or Rs 500 crore in net worth to spend at least 2 per cent of their 3-year average annual net profit on CSR activities in each financial year.
An important event was India formally joined the Paris Climate Change Agreement by submitting its instrument of ratification at UN headquarters in New York on the birth anniversary of Mahatma Gandhi. The Paris Agreement is underpinned by 162 intended nationally determined contributions (INDCs). From those details 189 countries plans to reduce emissions and enhance their resilience to climate impacts. The 2030 Agenda consists of 17 Sustainable Development Goals (SDGs), which are further broken out into 169 targets. Various corporates have planned, evaluated & expanded their CSR activities to fulfil the objectives.
“Ultimately all activities by corporates are aligned to the goals and to manage carbon footprints. It is a two way working system where both have a large bearing on each other,” said S.Govindan, Head, CSR, DHFL.
LabourNet is a social enterprise that provides employable workforce through skill development, education, entrepreneurship and employment across various sectors. Gayathri Vasudevan, CEO and Co-Founder, LabourNet said, “Poverty alleviation is what our efforts are all about. Creating sustainable livelihoods through the 3 pillars of Education, Employment and Entrepreneurship. Reduction of poverty and an equitable society cannot happen through subsidies. Opportunities for income generation and increase in the real income of people are critical to alleviate poverty.”
Not only coporates but crucial implementation partners such as NGOs came forward to participate and be an entity in the process. “CSR is a boon to the recipient organisation as it entirely changes the scenario and work-culture of the people at receiving end. In my experience, the CSR domain is not easily accessible to all the organisations on various levels who are supposed to be the beneficiaries of the same. The process is very long and formalities and documentation required become more of a liability than an asset,” said Siddhant Mohite, Founder, OYE (Organsation for the Youth & Elderly), which has over 3,000 volunteers globally.
Another important factor is that of collaboration and translation of values. While work is happening, the change in habit and behavioural change has yet to come around. Necessities are being created, but not utilised correctly to facilitate its purpose. “There are two areas of concern. One is corporate need to engage and work closely with communities to take meaningful steps. The children being educated and increased awareness is a good way forward. Second is, more collaboration is needed between the coporates and government and amongst the private sector to make a large difference. Everyone has strength and weaknesses and we need to go beyond cheque book philanthropy,” said Kaushik Sinha, Head of CSR, Magma Fincorp.
Central to growth of an individual is sports. This year a total of 117 athletes (63 men and 54 women) across 15 disciplines were fielded by the Indian Olympic Association (IOA) at the Rio Olympics. It was the country’s largest ever delegation sent to the Olympics. India performed spectacularly at the Rio Paralympic games, claiming their best ever haul of four medals, including two golds, a silver and a bronze medal, outpacing their Olympic counterparts, who just managed two medals. “11 out of 19 athletes from the contingent were supported with CSR funding. From the CSR budget, a very small percentage is directed towards sports. It is just the tip of the ice berg. It is upto us as individuals to provide support to the children and streamline the process. Sports excellence has a lot of value to inspire the youth. Companies opening up and coming forward to support, can have a great impact in the sports ecosystem,” said Deepthi Bopaiah, Executive Director, GoSports Foundation.
The announcement of demonetisation altered plenty approaches in circulation and ways of working for the citizens. “In CSR the essence of expenditure is mainly through banks and this decision would not have a mammoth effect as most are programs or project based decisions. In certain places there has been an influence of the decision, but interlinked solutions are present,” said S.Govindan, Head, CSR, DHFL.
There has been a huge requirement for clarity from the government and policymakers. This is in terms of reporting for CSR, transparency in the process, qualification of projects and foreign investment amongst others.
“As CSR matures and evolves, the government must look at policies that help CSR to function sustainably. For instance, to drive innovation. As efforts reach out to remote geographies, businesses can start using the opportunities of that footprint to create innovative products and services. Media has already been reporting positively on a constant basis. There is a clear viewership for these initiatives. However media can build on coverage by better communication and articulation of ROI, to enable viewers to make better sense of these projects,” said Gayathri Vasudevan, CEO and Co-Founder, LabourNet.
There is an increased appreciation in companies doing CSR seriously. Not just the larger companies but even mid sized and small companies are beginning to take a serious view of social development.
“In the last few years we have been seeing a positive movement towards well planned and aligned CSR activities. With a strong government policy in place and the companies are realising the importance of contributing towards societal development through strategically planned CSR is now being viewed as something more than a philanthropic obligation,” said Anshul Bhargava, Chief People Officer, PNB Housing Finance Ltd.
“In this New Year, we hope that all stakeholders groups work in a cohesive manner to support and supplement the programs ensuring a seamless execution. A collaborative response to uncertainty and shared challenges will create closer and more strategic relationship between stakeholders,” said Paul Abhraham, COO, IndusInd Bank
The outlook for 2017 is to increase collaborations and create immense impact. From the ratification of the Paris Agreement to stellar performances by athletes, all sections and sectors in society are working in sync positively towards a better tomorrow. Individual contribution is important entity in any equation, has and will always be vital to the sustainable solutions of the future.
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Regards,
The CSR Journal Team
