PM Narendra Modi Endorses GDP Suggestion On CSR Spending


In the GDP Magazine’s first annual issue on CSR in June 2017, while we were compiling data for FY15 and FY16 regarding CSR, we found that ample amount of fund was coming out in the form of CSR mandatory expenditure from each company and if this handsome amount was spent on some unilateral cause, it could certainly make a difference as the total CSR spending of one year was bigger than the total budget of many states. In fact, during FY16 and FY15, India Inc. spent Rs. 13,828 crore and Rs 9,565 crore respectively on CSR and this mammoth amount caught our attention. If such huge fund could be channelised in a focused way to improve upon some social sector like education, health care or even sanitation (as happened in Swachh Bharat Abhiyan during recent years), it would surely bring a sea change on the ground and the Human Development Index of the country would certainly improve.

As we know that the CSR spending has been made mandatory for companies, we made a humble suggestion to PM Narendra Modi that the “Government can put forward a guideline to channelise the CSR fund towards some set agenda on yearly basis, say education in one year and health care in the next year, and all companies earmark some amount (say half) towards the betterment of that sector during that year.” This suggestion of ours is based on the success of Swachh Bharat Abhiyan. While PM Narendra Modiji has initiated an outstanding campaign in the form of Swachh Bharat Abhiyan, the change that CSR spending has brought to India’s sanitation problem is known to everybody. This can be taken as a pilot model and with the government working as a catalyst to channelise the CSR funds towards a designated sector.

The GDP is thankful to Honorable Narendra Modi for initiating action on this humble suggestion, as while addressing a CPSE Conclave in Delhi recently, the Prime Minister urged all PSUs and other companies to focus on one specific theme each year.  PM Modi said that there should be more focused spending of PSUs’ CSR funds. “In 2014, the PSUs had focused on building toilets, because it was the theme for the year and the initiative worked well. Now PSUs should define a theme every year for focused spend of CSR funds. This way there can be much progress in the selected sector,” he added. The PM said that one good theme could be the development of 115 aspirational districts identified by NITI Aayog for special focus. He said CPSEs could also take up skill development programmes as part of CSR.

Importantly, this is exactly the same initiative that we suggested in our last year’s issue on CSR. Interestingly, during that same programme, PM Narendra Modi set a 100-day deadline for the heads of central public sector enterprises (CPSEs) to come up with a roadmap with “measurable targets” for strengthening state-owned companies and promoting development activities.

This article is part of 2nd Annual Issue of GDP Magazine on CSR. Governance Democracy& Politics (GDP) Magazine’s Special Issue on #CSR Takes A Deep Dive on the state of CSR Spending. It has a regressive database of 6000+ companies on CSR Spending. 

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