While the central government mandated CSR activity by India Inc. to combat Covid-19, and in a welcome move by the Finance Minister, Nirmala Sitharaman, supporting the CSR efforts to root out cases of Covid-19 from the nation, categorized it as an "eligible CSR" activity.
"Keeping in view of the spread of novel Coronavirus (COVID-19) in India, its declaration as pandemic by the World Health Organisation (WHO), and, decision of Government of India to treat this as a notified disaster, it is hereby clarified that spending of CSR funds for COVID-19 is eligible CSR activity," a circular issued by the Ministry of Corporate Affairs dated March 23 said.
CSR in focus to combat Covid-19
According to section 135 of the Companies Act, 2013, it is required of firms with a net worth of Rs 500 crore, a turnover of Rs 1000 crore or more to set aside 2 percent of their average net profits over the last three years for corporate social responsibility activities.
According to the Ministry of Corporate Affairs (MCA), funds spent by organisations on preventative care, medicines, medical equipment and provision of infrastructure will be considered as an eligible CSR activity.
"In view of the spread of novel #CoronaVirus in India, its declaration as pandemic by the WHO, and decision of Government of India to treat this as notified disaster, it is hereby clarified that spending of CSR funds for COVID-19 is eligible CSR activity," Sitharaman tweeted.
It is further stated that broad based items as per Schedule 7 of the CSR policy that enlists CSR activities can be interpreted liberally for this purpose. Post announcement by the Finance Minister, suggestions have been pouring in, requesting the Government to create a CSR portal wherein specific requirements depending on the need of the hour is clearly posted and corporates are advised to contribute in cash or kind towards those specific requirements.
CSR spends by Corporate India
Country's largest public lender State Bank of India (SBI) has committed to invest 0.25% of its annual profit for 2019-20 for CSR activities to fight out Covid-19. The bank will be using this money for various purposes such as provision of healthcare facilities for the underprivileged and the poor, cooperating with healthcare professionals and the industry.
TVS Motor Company and Sundaram Clayton have announced that it will spend Rs 30 crore to fight the coronavirus outbreak. The funding will come through Srinivasan Services Trust (SST), the social arm of TVS Motor Company and Sundaram-Clayton Ltd. SST will also manufacture and distribute 1 million face masks to those delivering essential services from healthcare to food supplies. The companies are further evaluating collaborations with 3D printing companies to make ventilators that will help support hospitals which lack the necessary life support systems to cope with patient care for COVID-19 victims. The company also claims that it will supply dry rations to daily wage workers and villagers in Baddi of Himachal Pradesh, who don't have a food supply.
DCB Bank commits to Rs 1 crore CSR spending over the next three months to take all possible measures to prevent, control and curb spreading of coronavirus. "The bank will engage with various agencies and partners to manage the response to Covid-19 in India. It aims to deploy this fund within the next three months," DCB Bank said in a statement.
IT firm Cognizant said that it will give its executives who are at the associate level and below in India and the Philippines, an additional 25 per cent on base pay as a bonus to recognize their extraordinary commitment and continuity-of-service efforts amid the coronavirus outbreak. The bonus for employees will be processed in their April paycheck.
Rahul Bajaj, Chairman of the Bajaj Group, has committed a whopping Rs 100 crore in efforts to fight out the global pandemic, coronavirus. Appreciating the undeterred commitment of sanitation, healthcare, local police and emergency support workers striving hard in these tough times to help us cope with the crisis, Bajaj stated, "We all need to come forward in ways more than ever before, to ensure that all citizens have access to healthcare and other necessities of life." Bajaj Group will be working with the Indian government and 200 of its NGO partners to provide immediate help and services to those in need.
ITC sets up a Rs 150 crore Covid-19 contingency fund to help healthcare professionals in the frontline fighting the pandemic, by providing them with PPEs and hygiene products. The company will be working with the state government and local authorities to ensure that assistance in food supply and medical care, attention is provided to the needy sections of society. Considering the supply of groceries and medicines are badly hit, the company will be working round-the-clock to ensure manufacturing and distribution of essentials continue without interruption.
Earlier, Reliance Industries announced setting up of the country's first Covid-19 hospital and isolation centre to ensure immediate attention and care to coronavirus positive cases.
Meanwhile, domestic auto major Mahindra & Mahindra is working on a ventilator prototype priced at Rs. 7,500, which otherwise costs Rs 10 lakh to help India combat the coronavirus pandemic. It will be launched in the next two days. Since India is falling short of ventilators, a lifesaving medical device, the company is working with two large PSUs and an existing manufacturer to simplify design of high spec ventilators and scale up production capacity.
