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   Friday, May 24, 2013
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Corporates differ but government firm on CSR compulsion


Finally, the large and small corporates will have to spare some of their increasing profits for social work and benefits. Government may make it mandatory for India Inc to set aside 2 per cent of their average net profit as Corporate Social Responsibility (CSR) budget. The proposal had been mooted back in 2009 by the parliamentary Standing Committee in its recommendations on the Companies Bill 2009.

Though government thinks that even after keeping 2 per cent aside as a part of their share of CSR, the total contribution is too less, but a few corporates disagree to this compulsion.

Government’s priority is to ensure enactment of the new company law in the forthcoming session of Parliament. The new bill seeks to delegate greater responsibility to independent directors and provide more say to shareholders.

If at all the law is made mandatory, there will be uproar from a lot of corporates. The need of the hour is an efficient implication of the law and it should be made sure that no corporate giants have an escape.
It would be interesting to wait and see how generous the business giants can be.

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The question that must be asked is: does water saved get reallocated to those who deserve it more? Ironically, the distribution system has no such provision and whatever little is saved gets sucked within the inefficient system itself. Afterall, municipal consumption is less than 10 per cent of the total water consumed across diverse sectors. For the big picture change, focus needs to shift from acts of personal consumption to gross failure of the system that controls and delivers water. Any campaign taking consumers on a guilt trip by engaging them in what-you-can-do-to-save-the-earth guilt trip is surely misdirected! 

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