Around Rs 22,000 crore to enter social sector as India Inc steps up CSR plans

MUMBAI: Surgeon-social entrepreneur Devi Shetty of Narayana Health is agonising over an issue of the nonmedical kind these days. The electricity bill of his expanding hospital complex in Bangalore has spiralled to Rs 1.2 crore a month, straining his financials. Shetty is now reaching out to corporates to help him tide over this energy emergency through deploying of energy-efficiency interventions and their corporate social responsibility (CSR) monies 

Around Rs 22,000 crore is expected to gush into the social sector from the next financial year onwards as Indian companies ramp up CSR spends in keeping with provisions under the Companies Act, 2013. It stipulates certain companies — with a net worth of Rs 500 crore or a turnover ofRs 1,000 crore or a net profit of Rs 5 crore — to spend at least 2% of their average net profits made over three preceding years on CSR programmes.

At a conference last week in Mumbai to link up companies with social sector players, Shetty told an eclectic gathering of corporate decisionmakers, foundation heads, and NGOs that the idea of "disassociating healthcare from affluence" could indeed come true, given the new circumstances. "We need 2 million heart surgeries a year," he said, urging companies to devise partnerships or seek out patients from under-privileged sections directly.

Companies had sunk into complacence as the Companies Bill traversed through the laborious legislative process through the year. Now, with April 2014 looming large, many are staring at the woeful inadequacy of the CSR initiatives they had been flaunting over the years.

After an initial phase of indifference and, later, even sly attempts by a few at gaming the rules — fitting in what they are doing currently as CSR or looking for loopholes to avoid doing what they ought to be doing — companies are now preparing for a new era or a new genre of CSR interventions. 

On sensing the corporate hurt at 'being told what to do', the government too has been changing its stance: from citing Section 134 — which talks of fines and imprisonment — to a more liberal view of defining what constitutes CSR, and implementation methodologies.