As we enter March, many organisations are looking to utilise their unallocated and unspent CSR funds. With the end of the financial year looming, there is added pressure to meet compliance obligations.
Some companies opt to meet their CSR requirements by directing capital towards a fund permitted under Schedule VII of the Companies Act, 2013. However, to maximise impact, we recommend exploring other avenues for zero-hour utilisation of unallocated and unspent funds and creating greater impact:
- Redirect Capital to Research
Contributing to research projects undertaken in the fields of science, technology, engineering, and medicine by public-funded universities and other permitted bodies, in alignment with items aimed at promoting the SDGs (ix)(b).
2. Inject into Incubators
Contributing to incubators and accelerators in STEM such as NSRCEL and CIIE, which are housed within IIMB and IIMA respectively and are aligned with item (ix)(a).
3. Social Impact Schemes
Funding innovative programmes such as Credit Guarantee Schemes for MSMEs, or using funds to unlock additional capital for social programs like skilling programmes, which are aligned to items (ii) and (iii).
4. Employ Implementation Agencies
Procuring and handing over capital assets required by eligible implementation agencies that are executing projects or support ongoing infrastructure programmes and require additional funding, aligned with any of the items listed under Schedule VII.
5. Community Causes
Conducting health and wellness camps, community clean-up campaigns, or green initiatives such as tree plantations, aligned with items (i) or (iv).
Some advantages of undertaking any of the above as opposed to contributing to a fund permitted under Schedule VII are:
1) When contributing to a fund, a company may not have direct oversight or influence over the CSR projects undertaken, and has very little control over how their funds are utilised.
2) Opting for direct CSR initiatives instead of contributing to funds can positively impact a company’s reputation as it facilitates more personal engagement with stakeholders, which in turn can lead to better public perception.
3) Direct involvement allows companies to tailor their CSR initiatives to their organisational objectives and values.
4) Prioritising direct engagement can demonstrate genuine commitment to social responsibility rather than simply meeting regulatory requirements, which may also be perceived as less impactful.
Sattva has been working with various non-profits and social organisations as well as corporate clients to help them define their social impact goals. Our focus is to solve critical problems and find scalable solutions. We assist organisations in formulating their long-term CSR strategy by strategically aligning with business to provide meaningful solutions to social issues.
For more information get in touch: impact@sattva.co.in.
