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Corporate Social Responsibility (CSR) is enshrined under Section 135 and Schedule VII of the Companies Act, 2013. India is the only country where this altruistic responsibility is compulsory for companies which have a net worth of Rs. 500 Crores or more or earns a net profit for rupees 5Crores or more, or has a turnover of Rs. 1000 Crores or more. This has helped to change the dimension of such responsibility towards the citizens, where companies instead of focusing only on capitalism, pay a bit attention to socialism as well.
The pandemic of COVID-19 has brought about an ethical responsibility in which companies are contributing. A lot of companies such as Reliance Industries Limited, Vedanta, Mahindra and Mahindra, Tata etc. have actively been participating in fighting the pandemic through providing meals, PPE’s ad various other initiatives. Even a lot of MNCs have been actively contributing to help India win the battle against Coronavirus.
The Government of India had also released a notification declaring that the contribution made to the PM CARES Funds would be considered as valid CSR. A criticism of the same is that the CSR funds lack accountability as it doesn’t fall under the scope of the Right to Information Act. If the same was available to the public they would be able to contribute towards the sector which has been lagging. Moreover, contributions made to the CM relief fund do not come under the arena of CSR in India, thus if contributed to the central fund it is a part of CSR but if contributed to the State it does not fall under CSR, thus leaving the states with lack of funds to fight against the pandemic.
The main reason behind a lot of company contributing through the CSR funds is that firstly, they won’t have to make any other further contribution; secondly, the public is actively involved in scrutinizing companies. Companies which have been actively involved have been gaining a goodwill in the eyes of the customers, thus helping to enable loyalty. Thus a lot of companies have also contributed by providing financial assistance through a contribution in the PM CARES Funds. The CSR has not only helped in procuring ventilator supplies but has also tried to ensure that no one has to go to sleep empty stomach. The public and private sectors have equally contributed towards the fund and proves the fact that “we are all in this together”.
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