In the recent revised guidelines, made by the Department of Public Enterprises the government has made it mandatory for all profit-making central public sector companies to spend money on CSR activities.
Besides, these enterprises cannot include money spent on sustainable development efforts under the Corporate Social Responsibility (CSR) scope.
The Department of Public Enterprises (DPE) has come out with the revised guidelines following the new Companies Act 2013 making social welfare spendings mandatory for cantral public sector undertakings.
In case of CPSEs only to comply and explain formula reasons for not spending this amount in a particular year would not be sufficent and the unspent amount in a particular year would not lapse.
The amount shall be carried forward to the next year for utilisation for purpose for which it was allocated.
The department has said that public sector companies should look at collaborations in CSR activities for “social, economic and environmental protection measures which are strictly necessary.”
Above all the public sector enterprise shall act as extended arms to make these spendings and shall be required to spend the amount out of the profits even if it does not meet the criteria as laid down under the Act.
