The most popular mode of undertaking Corporate Social Responsibility (CSR) since 2014 has been through nonprofit organisations. Forty-three percent of all CSR funds spent in the last four years were disbursed through these entities.

In 2018, the Ministry of Corporate Affairs (MCA) convened a High-Level Committee (HLC) on CSR to review the effectiveness of Section 135 of the Companies Act, 2013—which makes CSR mandatory for companies above a certain level of net worth—and suggest changes. As part of this effort, ATE Chandra Foundation partnered with Samhita Social Ventures to conduct a national consultation with 320 nonprofits to understand their experiences with and views on accessing CSR funds and implementing CSR projects, which led to some interesting insights.

  • Smaller nonprofits surveyed had received fewer CSR funds in the past year, than larger ones
  • Nonprofits in central India are less likely to receive CSR funding
  • Nonprofits working in specific cause areas are left out
  • Lack of information is a significant barrier to access
  • Nonprofits are looking for long-term commitments
  • A split verdict on the effectiveness of employee engagement
  • CSR by Public Sector Undertakings (PSUs) remained a sore point

Despite the concerns and challenges around access to CSR, most nonprofits were optimistic about tapping into this opportunity. To enable that, the HLC made several recommendations to the government, which include:

  • Aligning Schedule VII with a broader set of principles of inclusive development, and a list of widely accepted objectives such as the Sustainable Development Goals, rather than a prescriptive list of activities.
  • Clarifying that focus on local areas is only a directive rather than a mandate, and advising companies to balance local area preferences with national priorities.
  • Strengthening reporting of CSR spends, with better information disclosures and dissemination, with respect to the selection of projects, locations, implementing agencies, and so on, to facilitate more transparency.

Read the full article about how nonprofits view CSR by Anushree Parekh at India Development Review.