CORPORATE SOCIAL RESPONSIBILITY ADVISORY SERVICES

CORPORATE SOCIAL RESPONSIBILITY ADVISORY SERVICES

CORPORATE SOCIAL RESPONSIBILITY, COMPANIES ACT 2013 Corporate Social Responsibility (CSR) spending has been made obligatory under Section 135 of the new Companies Act, 2013, thereby reinforcing a culture of public service for businesses CSR is deemed compulsory for companies that fall under the following categories: 500cr 5cr 1,000cr or more of net worth or or more of net profit or or more of turnover The Act mandates companies to spend a minimum of 2% of their average net profit in the previous three years on CSR. Companies can implement their CSR activities through an NGO, a trust, a section 8 company or by themselves. As a result of this Act, over 10,500 companies now come under the compliance requirement of CSR. An initial estimated 20,000cr would be committed to CSR activities by companies. This combination of regulatory as well as societal pressure has meant that companies have to pursue their CSR activities more professionally LIST OF CSR ACTIVITIES UNDER SCHEDULE VII Education Women empowerment Rural sports Environmental sustainability Culture promotion Healthcare Sanitation Skill enhancement Care for the aged Others COMPANIES STRUGGLE TO FALL WITHIN CSR COMPLIANCE CSR compliance: % of companies 44% that spent <2% of their profits on CSR in 2016 i.e. failed to comply with CSR Act An analysis of 4,887 companies listed on the Bombay Stock Exchange showed there were 133 companies that either did not spend a dime, or were still formulating their CSR agenda. CHALLENGES TO PARTNERSHIP 36% 28% 20% 16% CSR spend by sales turnover size: 2015 2016 2015 2016 2015 2016 53% 57% 50% 56% 53% 31% 100-500cr 500-10,000cr > 10,000cr Do not know how to report on partnerships in accordance with the Companies Act 2013 Do not know whom to partner with The spending profile of larger companies improved by 22% points in 2016, while smaller companies continued to do well. The 22% points improvement in CSR spending profile can be attributed to: Do not know how to structure working model for partnership Do not have approvals from management PARTNERSHIP helps boost compliance % companies that used agencies: 53% 67% 84% 100-500cr 500-10,000cr > 10,000cr 1. Overcoming large-scale interventions 2. Using external agencies i.e., credible NGOs, trust and section 8 companies 3. Selection of good quality projects 4. Close and effective monitoring 5. impact assessment of the initiatives The challenges call for external CSR advisory services providing team who are an expert in helping bypass the hurdles and achieve maximum output out of CSR partnerships Source: Report on CSR by IBM, CRISIL CSR Yearbook 2017, Handbook on CSR in India by PWC,

ACTION FOR INDIA - CSR ADVISORY SERVICES In the way it is conceptualized, the CSR Act, 2013 provides enterprises a unique opportunity to help accelerate the social and human development in India through alignment of their CSR spends to national priorities. Adhering to such regulations is only the beginning, businesses must aim to make impactful and meaningful investments, which requires the right strategy, methodology and implementation with expertise in the social innovation sector. AFI s CSR ADVISORY ENCOMPASSES SERVICES ACROSS THE ENTIRE CSR VALUE CHAIN CSR POLICY FRAMING Helping create a holistic policy model indicating priorities and project details Ensuring highimpact CSR spend Developing a governance structure to effectively deliver CSR action plan CSR PROGRAM DESIGN Carrying out social baseline assessment surveys and identifying key impacts and their significance Creating 3-5 year roadmap for effective implementation of CSR programs addressing the identified key impact areas CSR PROGARM IMPLEMENTATION Identifying partners: exposure to compelling causes from 5 years of AFI s experience Rolling out capacity building programs for business CSR team and implementation partners IMPACT ASSESSMENT Defining KPIs and methodology for performance measurement of rolled out CSR programs Setting up of performance measuring team and MIS for the ongoing CSR activities LEGAL COMPLIANCE Ensuring legal compliance of the CSR program Preparing legal compliance report for business stakeholders as well as for submitting to the government BRANDING AND PR Identifying best opportunities and medium to showcase CSR activities for company s branding Assisting in creating communication material VALUE ADDITION OF FOCUSSED CSR ACTIVITIES FOR BUSINESSES As companies move from left to right on the value curve, greater returns are realized as CSR becomes more integrated into core business strategy. Innovation and growth Brand building Legal compliance Adherence to CSR laws stated by Companies Act, 2013, clause 135 Strategic CSR Alignment of CSR activities with social issues that reflect the core values of the business Positive branding of the company and improved connection with customers, employees and communities Access to new markets, new partnerships or product/ service innovations that prove beneficial for the business in long run

WHY AFI AFI IS PLACED TO BE THE IDEAL PARTNER TO COMPANIES AFI s PAN-INDIA NETWORK AFI brings together a network of 500+ leading social innovators of India, as well as influencers: impact investors, mentors, technology resources, government agencies and local partners. Integration of CSR initiatives would result in a mutually beneficial ecosystem. The network is growing fast owing to AFI s initiatives including AFI Annual Forum, which brings together various stakeholders of the social innovation sector; launching and expansion of social innovation hubs across India; among other dedicated efforts. Every year AFI conducts the Silicon Valley Challenge to identify the top five social innovators in India who have the potential to make large scale impact, and connect them to the right guidance and funds to achieve their goals. AFI has put together a small, dynamic and agile team to deliver meaningful solutions as part of its CSR Advisory Service. AFI s CSR team is headed by Dr. Bhaskar Chatterjee, widely acclaimed as the Father of Corporate Social Responsibility in India and instrumental in framing and issuing the 2% CSR legislation for Public Sector Enterprises in 2010. Thereafter, he played a major role in the inclusion of Section 135 in the Companies Act of 2013 and in the framing of the rules. He is a retired IAS Officer who in his last role was the head of the Indian Institute of Corporate Affairs. He is coming on board as a Senior Adviser at AFI and will be heading our CSR Advisory Service. AGILE TEAM WITH CSR EXPERTISE DR. CHATTERJEE ABOUT AFI Action or India (AFI) is a non-profit organization with the objective of helping social innovators in India overcome barriers to scale and achieve greater impact at the bottom of the Pyramid. Over the period of last 5 years, AFI has been able to impact social initiatives in agriculture, education, energy healthcare, livelihoods and financial inclusion, under the leadership and guidance of Sanjay Kadaveru, Sam Pitroda and Desh Deshpande 6 AFI ANNUAL FORUMS PAN INDIA INNOVATION HUBS SILICON VALLEY LEADERSHIP CIRCLE 3 ANNUAL SVC TREKS Hosted 6 AFI Annual forums so far where 600 handpicked social innovators connected with leading impact investors, executives, and entrepreneurs of Silicon Valley for help and guidance for their initiatives Launched Vision 2020 to build a pan-india learning network for social innovators through 20 regional social innovation hubs by the year 2020 Built Silicon Valley Leadership Circle - a distinguished set of investors, entrepreneurs, executives & academics to help India s most promising social innovators groom Successfully conducted 3 Silicon Valley Challenge treks for 15 leading social innovators selected from Annual Forums, to connect with the mentors, philanthropists and AFI s SVLC for help and guidance

Contact us Action For India S-6, Second Floor, DDA Shopping Complex, Mayur Vihar Phase-I Near Jeevan Anmol Hospital New Delhi-110091 India Email: info@actionforindia.org Ph: +91-81057 32008