Corporate social responsibility could be law: Khurshid
March 24th, 2010 - 7:07 pm ICT by IANS
New Delhi, March 24 (IANS) The government will look at all options, including legislation, to make more companies adopt corporate social responsibility (CSR), Corporate Affairs Minister Salman Khurshid said Wednesday.
“You can’t hope that everything will work without a basic legislative line drawn. But where that line should be drawn must come by way of consensus from industry,” Khurshid told IANS on the sidelines of a CII conference on inclusive growth.
“The response to our voluntary guidelines has indicated that some people think in some areas we should move towards instructions, and in some areas the voluntary guidelines are adequate,” added Khurshid.
The corporate affairs ministry has put up a set of voluntary guidelines on CSR and corporate governance on its website for discussion and to elicit response.
Asked if the government would consider bringing in clauses on csr in the new companies bill, Khurshid said: “It depends, the new law is still coming in. The discussions are still going on, people come and make presentations to the standing committee as well.”
“So such areas that the standing committee wants to include in the law will certainly be included in the law.”
CSR activities are still taken as charitable initiatives by most companies. But there are a few which have embedded their CSR activities with their existing business models. Among these are the ITC group, the Tatas, Bharti Airtel and state-run firms like the State Bank of India.
The government is in the process of issuing guidelines to state-run firms on CSR spending, which could be in the range 3-5 percent of net profits of up to Rs.100 crore.
Those earning net profit of more than Rs 100 crore may be asked to contribute up to two per cent of the amount.
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