India Inc. steps up CSR activities in pandemic times

Companies in India have made significant progress in fulfilling their corporate social responsibility (CSR) obligations in FY21, with fewer defaults and more exceeding their legal obligations. Legislative changes incentivized companies to comply with their CSR obligations, including penalties for failing to meet them and flexibility for those exceeding the 2% net profit spending requirement on CSR activities. The number of companies meeting the 2% requirement for CSR nearly doubled to 1,477, while the number of profit-making companies that did not spend anything dropped significantly to 3,202. Experts attribute the increased spending to the pandemic year and changes in statutory provisions regarding CSR. In FY21, India Inc. spent over ₹25,700 crore on CSR, with many companies spending on healthcare activities and contributing to the PMCARES Fund. The government expanded the scope of CSR activities, allowing private sector efforts to complement state measures. The legislative changes and pandemic exigencies contributed to this trend, with businesses more willing to contribute to the community’s needs.