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Govt finalises CSR guidelines for PSUs

Revised guidelines on corporate social responsibility and sustainability would come into effect from April 2013

 New Delhi, March 12: The Government today said it has finalised the CSR guidelines for public sector units under which they will have to earmark a portion of their profit for social activities.

In a written reply to the Rajya Sabha, Heavy Industries and Public Enterprises Minister Praful Patel said the revised guidelines on corporate social responsibility (CSR) and sustainability would come into effect from April 2013.

According to the guidelines, “the financial component/budgetary spend on CSR and sustainability would be based on the profitability of the company and shall be determined by the profit after tax (PAT) of the company in the previous year”.

If the PAT of CPSE in the previous year is less than Rs 100 crore, the range of budgetary allocation for CSR and sustainability activities would be 3-5 per cent and if the PAT is between Rs 100 crore and Rs 500 crore, it would be 2-3 per cent.

For the public sector unit whose PAT in the previous year is Rs 500 crore and above, the range of budgetary allocation for CSR and sustainability activities would be 1-2 per cent, it said.

It said that loss-making companies are not mandated to earmark specific funding for CSR activities.

“However, they must pursue CSR and sustainability policies by integrating them with their business plans, strategies and processes, which do not involve any financial expenditure,” it said, adding, the PSUs are required to have a policy approved by their respective boards of directors.

According to the guidelines, the unutilised budget for CSR activities planned for a year will not lapse and will instead be carried forward to the next year, it said, adding, “however, the CPSEs will have to disclose the reasons for not fully utilising the Budget allocated”.

Further, it said it is mandatory for CPSEs to take up at least one major project for development of a backward district as identified by the Planning Commission for its backward region grant fund scheme and one major project for environment sustainability.

“Five per cent of the annual budget for CSR and sustainability activities has to be earmarked for emergency needs, which includes relief work undertaken during natural calamities,” it said.


This story was first published in The Hindu Business Line on March 12th, 2013, here.

CSR by PSU's

Under the garb of CSR & sustainability innumerable MLA/MP NGO's will sprout and they will have to be finaced by the PSU 's and other corporates.If psu perform well and give service and also profit nothing more is required..... Why should anyone depend on doles beyond govt schemes.???/In fact if the govt plugs the leakage in the funds by the depts , it will be many times higher than the 2-3 % ...

It is shameful that instead of plugging the holes they are adding one more vehicle which will esnure that thier coffers fill up....


Agree; it should not be about govt or some community but a person itself. One concern is population if govt really wanted to do something than make some laws against population blast which i think is the mother problem. Each and every problem is linked with it only. And about CSR for PSU's, this sector only is able to resolve the issue right now and govt (every one) knows it thats why this binding is!

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