Human Resource Info4all

↑ Grab this Headline Animator

Corporate Social Responsibility Guidelines for PSU-Identification, Implementation and Evaluation

1.1. Public Corporations have legal responsibilities to maximize shareholder profits; but a shift in corporate mindset led by social expectations and pressure is causing business leaders to rethink their responsibilities with respect to corporate performance measured in terms of economic impact, social impact and environmental impact - commonly called the Triple Bottom Line.

1.2. Economic growth is possible only through consumption of inputs available in the environment and society. The harnessing of natural resources has a direct impact on the economy, the environment and society at large. Corporate Social Responsibility (CSR) is a concept whereby organizations serve the interests of society by taking responsibility for the impact of their activities on customers, employees, shareholders, communities and the environment in all aspects of their operations.

1.3. Corporate Social Responsibility is a Company's commitment to operate in an economically, socially and environmentally sustainable manner, while recognizing the interests of its stakeholders. This commitment is beyond statutory requirements. Corporate Social Responsibility is, therefore, closely linked with the practice of Sustainable Development. Corporate Social Responsibility extends beyond philanthropic activities and reaches out to the integration of social and business goals. These activities need to be seen as those which would, in the long term, help secure a sustainable competitive advantage.
2.1. The planning for Corporate Social Responsibility should start with the identification of the activities/projects to be undertaken. CSR projects/activities may be undertaken in the periphery where a company carries out its commercial activities as far as possible. Where this is not possible or applicable, a Company may choose to locate CSR projects anywhere in the country. Company specific Corporate Social
Responsibility strategies should be developed that mandate the design of Corporate Social Responsibility Action Plan (Long-term, medium-term and short-term), with a shift from the casual approach to the project
based accountability approach. The business plan under CSR should be integrated with the social and environment concerns related to the business of the company.

2.2. Selection of activities under CSR may be made to ensure that the benefits reach the smallest unit i.e. village, panchayat, block or district depending upon the operations and resource capability of the company.
The approach to CSR planning needs to be shifted from an ad-hoc charity to a long-term sustainable approach. The Project. Management and Monitoring skills available with the companies could be shared as far as possible, with the local administration by training and setting up required structures and systems.
2.3. The long-term Corporate Social Responsibility Plan should match with the long term Business Plan. This should be broken down intomedium term and short term plans. Each of these plans should clearly specify:
i) Requirements relating to baseline survey;
ii) Activities to be undertaken;
iii) Budgets allocated;
iv) Time-lines prescribed;
v) Responsibilities and authorities defined;
vi) Major results expected.

2.4 Such plans should also clearly specify the implementation guidelines and the involvement of the implementing agency. The procedures and methodologies prescribed for monitoring should be highlighted as well as the modalities of the concurrent and final evaluation. Finally, there should be a clear specification regarding mandatory documentation of the experience.
a. CSR initiatives of Central Public Sector Enterprises (CPSEs) should consider the following parameters for
identification/selection of schemes/projects:
(i) Thrust should be given wherever possible to areas related to the business of the CPSEs as a natural corollary to the business.
(ii) Investment in CSR should be project-based. Mere donations to philanthropic/ charity or other organizations would not come under the category of CSR.
(iii) CSR activities should generate community goodwill, create social impact and visibility.
(iv) For every project, the time-frame and periodic milestones should be finalized at the outset.
(v) CSR activities should also involve the suppliers in order to ensure that the supply-chain also follows the CSR principles.
(vi) CSR activities should help in building a positive image of the company in the public perception.
(vii) CSR activities may be related to United. Nations Global Compact Programme on Environment.
(viii) CSR projects may be closely linked with the principles of Sustainable Development, based on the immediate and longterm social and environmental consequences of their activities.
(ix) Every CPSE should shoulder responsibility for restoring /compensating for any ecological damage that is taking place  as a result of its operations.
(x) Care may be taken to ensure that CPSEs work towards fulfillment of the National Plan goals and objectives, as well as the Millennium Development Goals adopted by our country, ensure gender sensitivity, skill enhancement, entrepreneurship development and employment generation by co-creating value with local institutions/people.
(xi) Central Public Sector Enterprises should redefine their business continuity plan to factor in hazards, risks and vulnerabilities. They should also create value in innovative social investments in the community and may focus on the areas of "Preparedness and Capacity Building" in Disaster Management (OM).
(xii) Public-Private Partnership between the Government and the Central Public Sector could also be encouraged to leverage the strengths of the latter in Disaster Management. CPSEs need to network with the Ministries in Government of India / NOMA at the National level and State Governments / SOMAs at the State level to strengthen and formalize their role in the OM process for ensuring preparedness of the communities towards disaster resilience.

3.2 Project activities identified under CSR are to be implemented by Specialized Agencies and generally NOT by staff of the CPSE concerned. Specialized Agencies could be made to work singly or in tandem with other agencies.

3.3 Such specialized agencies would include:-
i) Community based organizations whether formal or informal;
ii) Elected local bodies such as Panchayats;
iii) Voluntary Agencies (NGOs);
iv) Institutes! Academic Organizations;
v) Trusts, Missions, etc.;
vi) Self-help Groups;
vii) Government, Semi-Government and autonomous Organizations;
viii) Standing Conference of Public Enterprises (SCOPE);
ix) Mahila Mandals! Samitis and the like;
x) Contracted agencies for civil works;
xi) Professional Consultancy Organizations, etc.
3.4 CPSEs should generate awareness among all levels of their staff about CSR activities and the integration of social processes with business processes. Those involved with the undertaking of CSR activities should be provided with adequate training and re-orientation.

3.5 Initiatives of State Governments, District Administration, Local Administration as well as Central Government Departments! Agencies, Self-Help Groups, etc., would be dovetailed! synergized with the initiatives taken by the CPSEs.

3.6 Every care should be taken to ensure that there is no duplication of CSR activities undertaken by the CPSEs with that of programmes run by Central, State and Local Governments.

3.7 While assigning CSR projects to specialized agencies, every possible effort must be made to verify the reliability and clean track record of such agencies. CPSEs may make efforts to prepare suitable panels of such agencies or they may select from panels maintained by Government, Semi-Government, Autonomous Organization or the National CSR Hub, etc.

3.8. Activities related to Sustainable Development will form a significant element of the total initiatives of CSR.

3.9. Such activities should come under the 3 UN Global Compact Principles pertaining to the Environment. Businesses are asked to:
i) Support a precautionary approach to environmental challenges;
ii) Undertake initiatives to promote greater environmental responsibility;
iii) Encourage the development and diffusion of environmentally friendly technologies.
3.10. Companies may also keep in mind the Environmental Management System as per ISO 14001.


4.1. The Department Of Public Enterprises, in conjunction with SCOPE and the CPSEs will create a National CSR Hub which will undertake/facilitate the following activities:
i) Nation-wide compilation, documentation, and creation of database;
ii) Advocacy;
iii) Research;
iv) Preparation of Panels of Implementing organisations/ monitoring and valuation Agencies;
v) Promotional activities, including production of short films, printing of brochures, pamphlets etc.;
vi) Conferences, Seminars, Workshops - both national and international;
vii) Act as a Think Tank;
viii) Any other matter as entrusted to it from time to time by the Department of Public Enterprises (OPE)

4.2 The National CSR Hub will begin operations with funding provided by Department of Public Enterprises. It will, however, be free to receive funds from:
i) SCOPE and both Central as well as State PSEs;
ii) UN Agencies, reputed international agencies such as World Bank, EU and other multilateral bodies and organisations;
iii) Reputed National and State Bodies;
iv) Government Departments, Autonomous Organisations, Planning Commission, Attached and Subordinate Offices, Corporations etc.
v) Philanthropic Missions, Trusts, etc. of national and international repute.

4.3. Decisions relating to the location and functioning of the HUB will be taken by DPE. SCOPE will be kept informed of such decisions and will be free to offer suggestions, inputs etc.

5.1 The CSR budget. will be mandatorily created through a Board Resolution as a percentage of net profit in the following manner:-
Type of CPSEs Expenditure range for CSR
in a Financial Year Net Profit (Previous Year) (% of profit)
                           (i) Less than Rs. 100 crore 3%-5%
                           (ii) 100 crore to Rs. 500 crore 2%-3%(Subject to a Minimum of 3 crores)
                           (iii) 500 crore and above 0.5%-2%

5.2 Loss-making companies are not mandated to earmark specific funding for CSR activities.

5.3. They should achieve CSR objectives by integrating business processes with social processes wherever possible and taking up such initiatives which do not involve cash outgo, e.g., by synergising their CSR activities with those of other profit-making coso
5.4. The CSR Budget should be fixed for each financial year. This funding will not lapse. It will be transferred to a CSR Fund, which will accumulate - as in the case of non-Iapsable pool- for the North East.
5.5. In case CPSEs have different Profit Centers like Factories I Plant locations, they may be allocated separate CSR budgets to be spent by them under the Annual CSR Budget allocations.

6.1. These Guidelines will supersede/override any other Guidelines/Circulars/lnstructions etc. that may have been issued by any Ministry/ Department on any prior date. Guidelines on CSR for CPSEs will henceforth issue only from the Department of Public Enterprises.

6.2. These Guidelines are fully in consonance with the draft Guidelines for Corporates issued by the Ministry of Corporate Affairs as per their website.

6.3. Such companies who are operating in sectors such as financial services, and have no specific geographical area or limited area, would adopt and define the areas of their choice for undertaking CSR activities.

6.4. Activities and expenditure related to staff benefits will not count as CSR.

6.5. Also grants to organizations/ institutions that are not specifically implementing CSR projects specified by the CPSE would not count as CSR.

6.6. These Guidelines may be amended by the Department of Public Enterprises from time to time with the approval of the competent authority.
7.1. The impact made by CSR activities should be quantified to the best possible extent with reference to base line data, which need to be created by the CPSEs before the start of any project. Hence Base-line Surveys are mandatory.

7.2. Meticulous documentation relating to CSR approaches, policies, programmes, expenditures, procurement, etc., should be prepared and put in the public domain, (particularly through the internet) and made available to the National CSR Hub.

8.1. Monitoring of the CSR projects is very crucial and needs to be a periodic activity of the Enterprise.

8.2. The Boards of CPSEs should discuss the implementation of CSR activities in their Board meetings.

8.3. Each CPSE should include a separate paragraph/chapter in the Annual Report on the implementation of CSR activities/projects including the facts relating to physical and financial progress.

8.4. The implementation of CSR guidelines will form a part of the Memorandum of Understanding that is signed each year between CPSEs and Government.

8.5. The performance of each CPSE with reference to its CSR activities should be monitored by the Ministry/Department concerned on a regular basis.

8.6. In MoU Guidelines from 2010-11 onwards, 5 marks have been earmarked out of the non-financial parameters for CSR activities and 5 marks for Sustainable Development initiatives.

8.7. For proper and periodic monitoring of CSR activities, companies may appoint a CSR committee or a Social Audit Committee or a suitable, credible external agency.

8.8 CSR projects should also be evaluated by an independent external agency. This evaluation should be both concurrent and final.
i) Drinking Water Facility
ii) Education
iii) Electricity Facility
iv) Solar Lighting System
v) Health and Family Welfare
vi) Irrigation Facilities
vii) Sanitation and Public Health
viii) Pollution Control
ix) Animal Care
x) Promotion of Sports and Games
xi) Promotion of Art and Culture
xii) Environment friendly technologies
xiii) Promotion of livelihood for economically weaker sections through forward and backward linkages
xiv) Relief to victims of Natural Calamities like eartl}-quake,. cyclone, drought & flood situation in any part of the country
xv) Supplementing Development Programmes of the Government.
xvi) Non-conventional Energy Sources
xvii) Construction of Community Centres/Night Shelters/Old Age Homes
xviii) Imparting Vocational Training
xviii) Setting up of skill development centres.
xix) Adoption of vi"ages
xx) Taking action on points suggested by Ministry of Forest and Environment pertaining to Charter on Corporate Responsibility for Environment Protection for 17 categories of Industries.
xxi) Scholarships to meritorious students belonging to SC, ST, OBC and disabled categories.
xxii) Adoption/Construction of Hostels (especially those for SC/ST and girls),
xxiii) Skill training, entrepreneurship development and placement assistance programmes for youth.
xxiv) Building of Roads, Pathways and Bridges.
xxv) Entrepreneurship Development Programme (EDP)
xxvi) Disaster Management Activities including those related to amelioration/ mitigation.
xxvii) Activities related to the preservation of the Environment/Ecology and to Sustainable Development

For more CSR info. and corporate ranking in CSR visit
If you like the posting, you may subscribe for related articles or follow me for coming up articles.
Share |


Anonymous said...

Are there any guidelines about how to implement CSR in a PSU ?

Anonymous said...

The post you read are guidelines for PSU's only but in a way they are broad guidelines. Apart from these, PSU's have drafted their own CSR schemes which are again extracted from DPE guidelines.

Anonymous said...

please can you help me with some questionaries regarding CSR for customer and for companies
my thesis is the CSR programe inhace the performance of bussiness
and i have to ask bussiness tha how thay see ha csr improve their profits.thanks ela

Post a Comment

Found useful? Leave a comment and recommend to others

Related Posts Plugin for WordPress, Blogger...