Effective CSR needs change in mindset
Three years on, the results testify to the success of the CSR law. The total spending by the companies under this head has been growing. As Union Minister for Corporate Affairs Arjun Ram Meghwal told Parliament in its just-concluded session, an assessment of CSR expenditure of 172 companies shows that they spent Rs 3,360 crore in 2015-16 against the mandated Rs 2,660 crore. This means that many companies have started going beyond the legislative mandate. There are many large companies like Infosys, Wipro and Tata Steel which have their own well-established foundations through which their CSR funds are spent. However, a vast majority of companies lack both experience and expertise to plan activities that come under the CSR and tie up with one or more non-profit organisations.
Three years after the CSR law, it is now time to review its impact and think of ways to improve it. Corporate social responsibility should not remain confined to mere compliance with the law. It is a commitment to support initiatives that measurably improve the lives of the underprivileged, and both the government and the corporate leaders must realise this. A new generation of Indian business leaders has emerged to change the perception that business is antithetical to societal needs. This change must be deepened through interactions between the government and industry leaders. The mandatory spending on CSR should not be reduced to another piece of legislation. It should lead to a change in the mindset of the corporate world that looks up to CSR as an opportunity for growth. The CSR law must be transformed into an instrument of social and economic change.