CSR works can unlock up to Rs 20,000 cr for social sector: Prez

Says the idea of CSR reflects a sense of responsibility of companies beyond their shareholders

Corporate social responsibility spending can unlock funds that are estimated to be as much as Rs 20,000 crore for the country's social sector, President Pranab Mukherjee said today.

Under the Companies Act, 2013, certain class of profitable firms are required to shell out at least 2% of their three-year average annual net profit towards CSR activities in each fiscal.

Mukherjee said CSR spending by companies can result in unlocking substantial amount of money for the social sector.

This amount is "estimated to be Rs 8,000 to 20,000 crore", he said.

It needs to be ensured that these funds are efficiently used, he added.

Mukherjee was speaking at the 'National CSR Summit -- Partnering the National Agenda' organised by industry body CII here.

According to him, the idea of CSR is reflects a sense of responsibility of companies beyond their shareholders.

The CSR norms, which are part of the Companies Act being implemented by the Corporate Affairs Ministry, came into effect from April 1 last year.

Corporate Affairs Secretary Anjuly Chib Duggal indicated that more activities beyond those mentioned in the Act could be taken up for CSR activities by companies.

Schedule VII of the Act can be "liberally interpreted", she said.

This Schedule lists out activities which can be included by companies in their CSR policies. These include works related to eradicating extreme hunger and poverty, promotion of education, promoting gender equality and empowering women; reducing child mortality and improving maternal health.