|A CSR initiative by GAIL|
BP Rao, CMD, BHEL, who is also the chairman of CII council on PSU is one of the key persons anchoring the initiative. The two-day summit will discuss, deliberate and assess the issues and share the best practices for...
managing PSE’s in terms of corporate governance, HRD, streamlining business processes, environment excellence and above all corporate social responsibility across the globe, says the CII website.
The conference assumes significance against the backdrop of the new Companies Act that seeks to encourage firms to use CSR to integrate economic, environmental and social objectives with their operations and growth. The Act seeks to actively engage top management by constituting a CSR board committee of three or more directors.
Section 135 of the Act makes it mandatory for companies “having net worth of Rs 500 crore or more, or turnover of Rs 1,000 crore or more or a net profit of Rs 5 crore or more during any financial year” to spend two percent of their after-tax profits to the society.
Now, if a company fails to spend the specific amount on CSR, instead of a penalty, they will have to issue an annual statement about the reasons for it. The Act has stated in clear terms where the company can spend and they have the liberty to choose areas that are the most beneficial for them as per their CSR policy. Nine activity areas like education, healthcare, environmental sustainability, gender equality, employability etc are specified where they can spend funds.
There were also reports that for several years the profit-making Maharatna and Navratna CPSEs have not been fully utilising the CSR funds.Thus, during 2011-12, CIL earmarked Rs 553 crore for CSR but spent only Rs 77 crore while ONGC allocated Rs 378 crore and spent only Rs 121 crore. IOC allocated Rs 96 crore and used only Rs 83 crore and SAIL allocation was Rs 64 crore and spent only Rs 61 crore on CSR activities for FY 12, say figures tabled in Parliament.