After one quick read of Section 135 in the Companies Bill, you will think how simple and practical it is. Then, if you will think again, you will realise that the 10 points in Schedule VII which are written on the last page of the Bill are the core of Section 135, and focus on them is a must for the country’s progress.
Yes, naysayers do exist, but they are in the minority and most of them are business owners. They are crying foul, saying governments have passed on its duties to businesses. (It may be noted here that the ministry of corporate affairs has clearly said that none of them will be penalised for ‘not’ spending on CSR – just that they will have to give concrete reasons for their inability to do so.) Do these people have concrete reasons, is yet another story.
For the rest of us, here are the 10 points to follow in Schedule VII – elaborated with examples of possible programmes to make them read and sound better and, of course, make a meaningful impact – benefiting the company as also the programmes’ intended beneficiaries.
What is in Schedule VII?
Every CSR activity of the company, starting from the creation of the policy to the writing of the impact report, will depend upon the objective and the intent of the company, and these 10 points will help in shaping the same. No, the 10 activities do not justify the CSR spectrum and scope as per global CSR norms and practices, but they are relevant in the Indian context – the country needs development at a fundamental level, beginning from the grassroots. The most interesting part here is that if the first 8 of the 10 prescribed points are implemented with zeal and enthusiasm, the country can expect to see the beginning of the change process that it really wants to see. All of these causes or issues are interrelated.
Here are the listed activities. Note that all the activities undertaken by the company have to be focused at the outside public and not at the company’s employees or their families.
THE 10 POINTS
1. Eradicating extreme hunger and poverty
Well, the Food Security Bill has been passed, but the government surely knows the implementation hassles and practical limitations thereof. So, a larger and focused role has to be played by the corporate groups in eradicating hunger and poverty.
(Is it a business function? Well, the moment you will think like this or ask similar questions to yourself or the governments, the intent with which the CSR should be done will suffer and so will the social programme. Let’s accept the law the way it is and not compromise on what we ‘really’ have been wanting to do – that is, our bit towards bringing about the change.)
So, what all can a company do? Well, one simple way is to adopt a few families in abject poverty and start giving them food – funded by your CSR budget – on everyday basis. But if the company decides to pull the plug for whatever reasons, the hunger will remain. Hence, a sustainable CSR programme wherein the poor are not given a fish to eat, but are trained to do fishing as well as taught to sell it in the market, will make some difference. Create self-help groups, train them, and then fund them for micro businesses and use your business expertise in developing their business alongside. How about creating a self-help group that can somehow be a vendor of the company? Who’ll not benefit?
No, those langars and bhandaras, and food for Amarnath and Vaishno Devi pilgrims or biryani at Haji Ali will not eradicate hunger. It rather makes its eradication more difficult and cannot be considered a part of corporates’ responsibility, or of the Bill in this case. For charitable purposes and with regard to religious respect, they may make some sense.
2. Promotion of education
Yes, the country has a Right to Education wherein schooling is free for all, but since the government does not want us to continue to crib about inefficient systems, they have given the baton in the hands of businesses.
How can a corporate group help? One of the best case studies on ‘promotion of education’ by a corporate group’s foundation is the Satya Bharti School Program. It is a rural education initiative of Bharti Foundation, the philanthropic arm of Bharti Enterprises. You can Google and see the sustainability and scalability aspects of the same.
For a smaller business, who just about falls within the CSR Bill’s ambit, adopting a running school in a remote village and upgrading its infrastructure as well as running campaigns across villages to inform and educate people to pursue them to send children to schools shall make a difference.
Something to note: It is not that most children or their parents do not want to avail of free education, but there are multiple factors, primarily the poverty-generated troubles, that stop them. So, the education programme cannot be deemed a success unless every child in its vicinity is attending the school.
3. Promoting gender equality and empowering women
We need not delve into the Women’s Reservation Bill for the same reasons as mentioned for the free food and free education acts. We all know the condition of women in the hinterland and understand why this needs attention.
To begin with, identify the humiliated and exploited women at the grassroots and empower one so much that she becomes a role model for the ones around her. This has always worked.
How? There are plenty of ways. The women empowerment project should follow these steps (in the given order): motivation, introduction to freedom, creation of union, education and employment.
Over 95 per cent of the self-help groups are being run by women. More than 99 per cent of them are successful and growing.
4. Reducing child mortality and improving maternal health
Crores of rupees have been earmarked for Nirmal Bharat Abhiyan, which promises to ensure toilets in the remotest of villages in India. Numerous funds have been pumped into developing primary health centres and setting up of anganwadis across the country. (We need not discuss their impact here.) The corporate groups have been given an opportunity (that is how we shall look at it) to contribute, and it is a serious cause.
The root cause of infant as well as child mortality in India is the ill health of the mothers. The CSR programme can help in creation of necessary medical facilities or upgrading of the existing ones, and ensure they are being used appropriately.
How about engaging the company’s medical staff or hiring one to maintain health records of all – especially the ones who are pregnant – and ensure assistance until the infant becomes a toddler. Such programmes cannot be self-sustaining. Hence, a programme to empower the women shall run alongside, so that the women can earn what they deserve. The success shall be measured not on the basis of reduced mortality but on the basis of ‘how many women paid to avail of the facility’.
5. Combating human immunodeficiency virus, acquired immune deficiency
For those who do not know: The US$2.5 billion National AIDS Control Plan III (NACP) was set up by India in 2007, while NACP IV is in the making. The programme also received support from UNAIDS, while charities like Clinton Foundation, with strong financial backing, are also engaged in eradication of the disease.
And now, businesses are expected to join the league. Well, yes, awareness campaigns help. Street plays and campaigning at the grassroots have been cited as the best communication tool. Adopt an area, engage with its youth, and create awareness teams comprising the company’s representatives, local influencers, theatre artists and, if possible, a celebrity, and reach as many people as you can, and as many times as you can.
The idea should be this: The team should be able to sit on a cot with the AIDS patient and announce that this man/woman will be the last one to have AIDS.
6. Ensuring environmental sustainability
The country has a full ministry to ensure environment sustainability, which is an aspect that by all means is a part of the basic hygiene practised by professional companies.
All large corporations, at least the ones who bring out their annual sustainability report, have been ensuring this for a long time now. From using various means for conservation of all natural resources to engaging in replenishment activities including plantation, harvesting and recycling, corporate groups have been doing their bit.
However, these activities now have to move out of the company’s premises, to places where these are most needed. For example, developing the waste patches of land, adopting the barren grounds, and joining hands with conservation projects are some of the ways of fulfilling your CSR obligation.
Yes, programmes focused towards conservation of natural resources, anti-pollution activities and biodiversity conservation, especially the endangered species of animals, birds and plants, too can be included under this header.
7. Employment-enhancing vocational skills
Hundreds of vocational courses are being conducted in thousands of government institutes and polytechnics across the country. And now, businesses are expected to create more such programmes, if not centres. Or at least help some of the existing ones run. This is important. How can you otherwise empower the individual?
The best way to go about this will be to find what sort of workforce you need on a regular basis and what skills are required. Identify the underprivileged individuals, train them in a particular trade, and hire them. If you do not have the space to accommodate them all, set up an employment exchange, communicate with your vendors and clients – the chain can go up to their vendors and clients – and help in finding jobs for them.
The programme should be deemed successful when the exchange has more offer letters and worker seekers than job seekers.
8. Social business projects
Now, what are these? Shouldn’t your business be also called the same since a considerable amount of your profits will be channelled towards social projects?
Well, any argument on this front will lead you nowhere as ‘social business projects’ here clearly means the projects whose return in investment (ROI) is not in terms of the revenues but in the form of social impact.
No, social business project should not be confused with social media projects. Facebook and Twitter campaigns alone cannot make a full impact, they can only support one. Do not think of spending the CSR fund towards a social media campaign.
Businesses like microfinance in rural areas, setting up of direct retail channels for rural artisans, cooperatives that empower the women and youth, modern businesses focused at people and planet – basically the businesses that earn to sustain themselves as well as the cause that they are working towards need corporate groups’ assistance. They fall in the CSR Bill’s ambit.
9. Contribution to the Prime Minister’s National Relief Fund or any other fund set up by the central government or the state governments for socioeconomic development, and relief and funds for the welfare of the Scheduled Castes, the Scheduled Tribes, other backward classes, minorities and women
This point should not be that difficult to decode. It simply says that if you are not being able to chose a CSR programme, let your funds go the government. It knows where, how and when to spend for a cause.
However, when CSR programmes have a lot more to them than just spending towards a social cause, this second-last point should be the last option for a corporate group to look at.
10. Such other matters as may be prescribed…
Like it always happens in most of the government’s documents – it is a screw that has been left loose so that it can help in tuning (or tweaking?) whenever needed. For instance, if a company is spending/spends towards a programme that does not fall in the categories listed above but still makes a social impact that the makers of the Bill failed to see/visualise when the Bill was being drafted, such spends or that particular programme can fit in the last point.
This also happens to be the last point on the last page of Companies Bill 2012.
CauseBecause has developed a CSR Kit that brings together the process of ideating, implementing and reporting CSR on automation. The Kit is at implementation stage at various corporate groups as well as at a few small and medium enterprises (SMEs) in manufacturing, entertainment and services sectors.
Interestingly, the Kit does not cost companies anything – rather, it channelizes funds from public relations (PR) and branding departments towards CSR without compromising on the value of either.
- Decoding the CSR clause in Companies Bill 2012 – Part 1
- Decoding the CSR clause in Companies Bill 2012 – Part 2