The government’s recent move to expand the list of projects eligible for CSR spend has come as a relief to the CPSEs struggling to exhaust fund allocation under this head.
Housing for economically weaker sections (EWS), slum re-development, activities undertaken for promotion of road safety, and social business projects for giving medical and legal aid, and treatment to road accident victims are some of the additional projects which the central public sector enterprises (CPSEs) now can take up under corporate social responsibility (CSR).
?These new categories will give CPSEs flexibility in selecting CSR projects and in expediting spending?, says Ranjan Mohapatra, president, Vision Consulting, a management & CSR consultancy.
Many such projects are being undertaken by major PSUs and these would now qualify for credit under the CSR guidelines.
The government has also allowed companies to provide their CSR funds to established NGOs or trusts which can carry out the CSR projects. This is also being practised by many companies. Bhel, for example, provides financial assistance to various NGOs/trusts/social welfare societies that are engaged in social welfare activities throughout the country.
Similarly, Steel Authority of India Ltd (Sail ) has established super-speciality hospitals and primary health centres to provide specialised and basic healthcare to people living in the vicinity of its factories.
Last week, a circular issued by the ministry of corporate affairs said works in the areas of disaster relief and setting up of trauma care around highways, and projects meant for development of rural India will be covered as a legitimate CSR activity. As per the circular, supplementing government schemes like mid-day meal by corporates through additional nutrition would qualify under the new CSR norms.
As a result, the CSR projects undertaken by ONGC like women?s empowerment, girl child development, gender sensitive projects, water management including ground water recharge, are all under the list of cleared CSR projects.
?The expanded list of activities under CSR will give a boost to the efforts undertaken by the leading CPSEs. Earlier, the interpretation of the rules to the CSR clause denied such activities as something that will qualify for CSR activities,” said a corporate lawyer.
The inclusion of housing for economically weaker sections will encourage companies to take up group housing projects, said a realty consultant. Citing the case of Coal Mines Officers’ Housing Society?run by non-profit organisation Society for Advancement in People?s Dwelling, Health & Action (Sopan) in Delhi/ NCR for executives of Coal India and other leading CPSEs like Sail, Bhel, NTPC?he said, societies like Sopan can build homes for the economically weaker sections on behalf of PSUs.