In a major boost to the CSR activities, over 90 per cent of companies have complied with provisions of section 135 of the Com-panies Act 2013. The res-ults are based on disclosures of 1,181 listed companies on BSE that had to comply with Section 135.
“In the first financial year, around '6,400 crore has been spent. Almost 55 per cent of that has been channelled to education, skills, livelihoods, health and sanitation,” according to a CII-ITC Centre of Excellence for Sustaina-ble Development report.
Most of the companies have projects in industrialised parts of the country, Maharashtra and Gujarat leading the pack. Only about 2 percent of '6,400 crore have gone to PM’s relief fund.
By March 31, 2015, 97 per cent of the companies had board-level CSR committee and 94 per cent of the companies had CSR policy, of which 91 per cent had disclosed it on company’s website. Almost 50 per cent of the chairs of CSR committees are independent directors.
CESD analysis reveals that 87 per cent of the eligible listed companies have actually spent on CSR, though around 52 per cent spent less than two per cent. Around 83 per cent of those 52 per cent of the companies have given reasons for underspend, said the report. “Most of the companies lost time in the beginning to understand a fairly complex piece of legislation and then setting the governance structure, drafting a policy, and identifying projects or aligning ongoing projects to Schedule VII of the Companies Act.
The other reasons for underspend are projects being multi-year, or companies couldn’t find right projects or implementing agencies,” said the report.
“This comprehensive analysis corrects all distorted perceptions that compliance on section 135 was abysmal. For thousands of crores of Rupees to be spent every year, it is important to get the fundamentals correct, have processes and governance in place,” said the CII report.
