Corporate Social Responsibility (CSR)
became a statutory responsibility for the
Indian companies with the passing of the
Companies Act, 2013. In the last year’s
report the theme of CSR has been dealt with
in the great detail in a separate Chapter.
1
by Manas Ratha. Companies are required
under the Act to spend a part of their profits
on specific themes that have a social welfare
objective. The companies are required to
frame policies, commit funding, ensure
oversight and report results in order to
ensure that the money spent is well spent.
The private sector and corporates’
involvement in promoting welfare of com-
munity and achieving economic and social
empowerment of vulnerable people is much
older than the recent government initiative.
A survey of top 300 companies in India car-
ried out showed that 142 of these companies
had set up a separate foundation. These
foundations had mostly been set up before
the year 2010 and some of the foundations
more than 50 years old. These foundations
had taken up a wide variety of activities in
education, health, livelihoods, community
empowerment and other related areas.
While quite a significant part of the welfare
activities had been in areas where the manu-
facturing units were situated or targeted at
potential customers of these companies,
a large part of the welfare measures went
much beyond their areas of operations
or their customers. In effect a number of
initiatives carried out by these founda-
tions addressed general issues of people
with whom the company did not have any
commercial or business dealings. In these
cases the companies went far beyond being
a mere donor to the foundation’s activities.
The companies allowed the use of their
name to lend credibility to the foundation,
took care of administrative, infrastructural
and structural needs and bore the expenses
on employees.
The companies also pro-
vided senior management expertise from
the companies’ rolls for the foundation
in order to manage the operations of the
foundation well. The study carried out
by Prakruthi
2
found that a large part of
the work done by the foundations was in
partnership with NGOs. This enabled the
foundations to leave the detailed field related
implementation aspects to institutions that
are competent and retain the planning and
strategic aspects of development interven-
tions with themselves. This appears to have
been a win-win situation that had developed
over a period of time.
After the Companies Act, 2013 came into
effect there have been several doubts raised
on the nature of interventions, eligibility of
certain types of existing development works
Private Sector Engagement
in Livelihoods and
Corporate Social
Responsibility
Chapter
8
1
Chapter 4: Corporate Social Responsibility and
Livelihoods, Manas Ratha, SOIL, 2014.
2
Archana Shukla Mukherjee, Sunanda Poduwal,
VirafM.Mehta, 2015, Study onCorporate Foundations:
An EmergingDevelopment Paradigm? India: Prakruthi.
