In recent news, the President of India has bestowed the inaugural National Corporate Social Responsibility (CSR) Awards to select corporations. The Ministry of Corporate Affairs established these awards as a way of acknowledging the outstanding CSR initiatives of corporations aimed at promoting inclusive and sustainable development. The Indian Institute of Corporate Affairs (IICA), a thought leader within the Ministry, provided logistical and technical support throughout the stringent awarding process.
The National CSR Awards: Categories and Dates
The honours and awards were divided into three distinct categories. The first category, Corporate Award for Excellence in CSR, was determined based on the level of a company’s spending on CSR initiatives. The second category, Contribution of CSR in Challenging Circumstances, was delineated by geographic regions including north, east, west, south, and north-east. Lastly, the third category, Contribution to the National Priority Areas, considered contributions to fields such as Education, Skill Development and Livelihoods, Agriculture & Rural Development, among others. The announcement of the National CSR Awards will occur annually on October 2nd.
The Concept of CSR in India
The term “Corporate Social Responsibility” is generally defined as a corporate endeavor to evaluate and assume responsibility for the company’s environmental impact and its impact on social welfare. In India, CSR operations are guided by clause 135 of the Companies Act, 2013. This Act mandates a certain class of profitable companies to allocate at least two per cent of their three-year average annual net profit to CSR activities in a given financial year. India has the distinction of being the first country globally to legally require CSR spending along with establishing a framework to identify potential CSR activities.
The Underlying Philosophy of CSR: Mahatma Gandhi’s Trusteeship Philosophy
The philosophy underlying CSR is deeply rooted in the trusteeship concept proposed by Mahatma Gandhi. This socio-economic theory encourages capitalists to act as custodians, rather than owners, of their wealth and behave in a socially responsible manner. Gandhi’s trusteeship concept emerged from his belief in non-possession’s law and reflects his spiritual evolution, which he partly attributed to his in-depth engagement with and study of theosophical literature and the Bhagavad Gita.
Quick Facts About CSR in India
| Fact | Detail |
|---|---|
| First country to mandate CSR spending | India |
| Law governing CSR | Clause 135 of the Companies Act, 2013 |
| Minimum CSR contribution required from profitable companies | 2% of their three-year average annual net profit |
| Annual National CSR Awards | October 2nd |
The Role of IICA in India’s Corporate Landscape
The Indian Institute of Corporate Affairs (IICA) has played a crucial role in the implementation of these awards. As a think-tank for the Ministry of Corporate Affairs, IICA liaised in providing the necessary technical and logistic support throughout the demanding awarding process.
