Finance Minister Palanivel Thiaga Rajan on Monday urged corporates to address grassroots-level problems through the corporate social responsibility (CSR) initiative. He said such issues often fell through the cracks of policymakers and government departments.
“Sometimes, the nature of government structures is not conducive to the aspirations of our people. We need some profound reforms in the system,” he said, releasing the Tamil Nadu Corporate Social Responsibility Report.
The report was released on the sidelines of the first Tamil Nadu CSR Summit 2021, organised by Sattva Consulting, in partnership with the Madras Management Association and Dhwani Foundation.
Mr. Rajan said the corporate world had skill sets like data-driven, performance-oriented, benchmarkable, accountable and documentable processes, which a government with a development agenda ought to have but does not.
Value of CSR
The real value that CSR can add to society is by helping systems and processes — data-driven, evaluation-driven and so on — reach the last mile, he said.
The problem with governments is that big problems get recognised, but the smaller ones fall through the cracks. Here, CSR can play a big role, Mr. Rajan said.
There have been many times when CSR has been a leading example, such as in water conservation efforts made by NGOs (supported by corporates). CSR can become a benchmark for the government to live up to, he said.
Mr. Rajan said he had a negative view on CSR 20 years ago. Compared to 20 years ago, now there is a crucial role to be played by corporate entities, which also greatly benefits society, he said.
Many of the greatest democracies are the ones that hold governments accountable — the balance of power in a democracy requires institutions and civil society, supported by corporates and CSR, Mr. Rajan added.
Tamil Nadu received ₹4,094 crore from 2014 to 2020, and is the fourth highest CSR spender in India, since the CSR mandate was made into a law in 2014, according to the report.
In the last two years of 2018-2019 and 2019-2020, the State received over ₹800 crore each from different corporates in the country. Companies headquartered in Tamil Nadu played a key role, with 72% CSR funds received coming from them, it added.
Education was the most preferred segment, with healthcare and rural development coming in the second and third places.
According to the report, Chennai received a major chunk of CSR outlays, at close to 25%, with Vellore and Coimbatore receiving over 6% and 5% respectively.
However, NITI Aayog-recognised aspirational districts Ramanathapuram and Virudhunagar received less than 1% of the outlay across the last six years, it said.
The three districts of Ariyalur, Tenkasi and Tirupattur received none at all, the report said.
The Finance Minister said data showing meagre spending of CSR funds in aspirational districts should be a wake-up call for corporates to be more thoughtful, granular and detailed in their approach.