Generic selectors
Exact matches only
Search in title
Search in content
Post Type Selectors
Generic selectors
Exact matches only
Search in title
Search in content
Post Type Selectors
Five years on, mandated philanthropy not delivering in India

Five years on, mandated philanthropy not delivering in India

Corporate Social ResponsibilityBy Amit Kapoor,

India is now into the fifth year of its unique experiment of legally binding companies to be socially responsible. This push by the government to solve the country’s most challenging social problems was based on the idea that the corporate sector will come up with transformative solutions that will scale up impact across the country. As the development goals of the country are immense and everyone recognises that the challenges can only be overcome with the effort of every stakeholder in the ecosystem, many scholars viewed it as the right move by the government.

The CSR (Corporate Social Responsibility) sector has matured over the years, but no significant impact has been made in the development issues that India faces. There are many challenges that need to be addressed before CSR becomes a powerful force for change.

Ministry of Corporate Affairs data reveals that out of 5,097 companies that filed annual reports until December 31, 2016, for the financial year 2015-16, only 3,118 had done some CSR expenditure. For the financial year 2014-15, 3,139 companies had spent 74 per cent of the prescribed CSR expenditure. Many of the companies made their CSR investments to the Prime Minister’s Relief Fund. The reasons stated by the companies for zero spendings include non-finalisation of location of the project, technical difficulties and organisational capacity to identify projects still in creation. Some of the companies even cited that their profile does not gel with the concept of CSR and they are not required to constitute a CSR committee.

These findings provide two major insights about Indian businesses. First, while many of them are making efforts to address societal challenges, they lack strategic planning to identify the ideal projects for investment. The grants made by most of the companies have no long-term strategic thinking behind it. Second, most of the businesses still do not consider it their responsibility to invest in the advancement of communities around them. They fail to consider CSR as a holistic view of the impact that businesses have on society and the environment through their operations. Even if these companies make some investments in future, their behaviour suggests that there will be a lack of engagement.

The lack of strategic planning, innovation and experimentation and the lack of engagement by businesses will not lead to high-impact results. It is important for businesses to understand the challenges faced by the citizens to make a meaningful impact.

One way is to enable businesses to see new opportunities to solve public problems. They should get hold of a social issue that is at the core of their business and then use their resources and capabilities to address the problem in a way that will help not only society but will reap benefits for the company as well. This implies that they should focus on creating “shared value”. The other route to tackle the social challenges that India is facing is that businesses start embracing strategic CSR and adopt strategies that will help move the needle towards urgent needs.

Both these solutions require an in-depth analysis of the well-being of our country — analysis that can bring out state-specific social challenges and areas of relative weaknesses. Such a tool can act as a useful guide for companies as to where and how they can best effect change by helping them identifying key focus areas for prioritisation and investments. Social progress is a concept that can enable businesses to harness their full potential to enhance well-being in society.

Social progress views development beyond the concept of GDP. It focuses on capturing the real issues faced by the people. This is already helping businesses to improve people’s lives in many other countries. In Brazil’s Amazon, a detailed social and environmental diagnosis of 772 municipalities spurred Coca-Cola and Natura to conduct a community-needs survey based on the Index framework. This laid the foundation for a new development programme that was a collaboration between citizens, government, business, and civil society.

The programme, guided by the social progress data, has improved water and sanitation infrastructure, providing 500 households with consistent sources of clean water for the first time. They also constructed new river piers to improve transportation during seasonal flooding and increase connectivity with neighboring communities. These improvements have been made possible because businesses in that region took responsibility for the well-being of society.

Similarly, businesses in India can use the tool for their CSR action plans to determine areas in which they can allocate resources and improve the quality of life across communities. For instance, when it comes to nutrition and basic medical care, the Index shows that Madhya Pradesh performs the worst among all states. Uttar Pradesh and Jharkhand follow closely. Therefore, FMCG companies can undertake targeted initiatives across this belt to tackle the perpetual problem of nutrition in India and companies in the pharmaceutical and medical sector can help improve the condition of basic medical services in these states.

There exists immense scope for corporates to aid social progress in India and it does not even have to be forced down their throats. Merely making use of indices like the Social Progress Index to identify areas of social need that intersect with their line of business and contributing their two cents should suffice. It just might also make for a unique business opportunity for them. One only needs to look.

(Amit Kapoor is chair, Institute for Competitiveness. The views expressed are personal. He can be contacted at Amit.Kapoor@competitiveness.in and tweets @kautiliya. Manisha Kapoor, senior researcher, Institute for Competitiveness, has contributed to the article.)

—IANS

Electric car makers seek cut in batteries’ GST from 28% to 12%

Electric car makers seek cut in batteries’ GST from 28% to 12%

electric carNew Delhi : Ahead of the GST Council’s next meeting on Saturday, the Society of Manufacturers of Electric Vehicles (SMEV) has called for reducing the GST of 28 per cent on batteries. It has pointed out the anomaly of the higher tax on these when sold separately as against 12 per cent when sold with the vehicles.

“Lithium batteries usually need to be sold separately from the electric two-wheelers to give a choice of the batteries at the point of sale. Such batteries have become significantly costlier because of the 28 per cent GST on them, leading to a big dampener for the electric two-wheeler customers,” an SMEV release said on Friday following its annual general meeting (AGM) here earlier this week.

“SMEV is requesting uniform GST rate for EVs (electric vehicles) and batteries at point of sale,” it said.

At its meeting with the Department of Heavy Industry (DHI) and NITI Aayog officials, the SMEV emphasised the need for incentives and appropriate policy measures to encourage wider use of electric vehicles in the country.

“Short-term measures and incentives for the existing manufacturers are the need of the hour,” SMEV Director (Corporate Affairs) Sohinder Gill said in a statement.

“The FAME (Faster Adoption and Manufacturing of Hybrid and Electric Vehicles) India scheme is expiring this month and we request the government to announce its continuation at the earliest,” he added.

The FAME scheme, extended earlier for six months till September-end provides incentives for purchase of electric and hybrid vehicles in particular areas.

The SMEV also called for prioritising the development charging infrastructure, which is mostly limited to the private sector.

“The government needs to build a robust charging infrastructure for mass usages of EVs,” the statement said.

Meanwhile, Heavy Industries Minister Anant Geete has said that the government is considering the extension of the FAME scheme by six more months.

“Most likley, we will extend it for another six months after the end of September. Earlier, the phase one of the FAME scheme was extended by six months,” Geete said at the 57th SIAM Annual Convention here on Thursday.

—IANS

India’s 40 percent rural people prefer to stay single: Census

India’s 40 percent rural people prefer to stay single: Census

The Union Minister for Finance, Corporate Affairs and Information & Broadcasting, Shri Arun Jaitley addressing at the release of the New Socio-Economic and Caste Census (SECC), in New Delhi on July 03, 2015. The Union Minister for Rural Development, Panchayati Raj, Drinking Water and Sanitation, Shri Chaudhary Birender Singh and the Chief Economic Adviser, Dr. Arvind Subramanian are also seen.

The Union Minister for Finance, Corporate Affairs and Information & Broadcasting, Shri Arun Jaitley addressing at the release of the New Socio-Economic and Caste Census (SECC), in New Delhi on July 03, 2015. The Union Minister for Rural Development, Panchayati Raj, Drinking Water and Sanitation, Shri Chaudhary Birender Singh and the Chief Economic Adviser, Dr. Arvind Subramanian are also seen.

New Delhi: (IANS) Over 40 percent people living in India’s rural areas prefer not to marry and live single, according to Socio-Economic and Caste Census (SECC) data released here on Friday.

The data said 41.64 percent people have never married and stayed single in rural areas. Nagaland, Meghalaya and Jammu and Kashmir led the tally for being home to such people.

Nagaland has the maximum 55.88 percent people preferring not to marry followed by Meghalaya and Jammu and Kashmir with 53.33 and 51.64 percent respectively, the data said.

The SECC data said Daman and Diu was home to the largest number of married people with 52.73 percent followed by Andaman and Nicobar and Kerala with 49.35 and 47.86 percent respectively.

Mizoram (1.08 percent), Lakshadweep (0.51) and Meghalaya (0.35) were the states having the maximum number of divorced people, it said.