About CSR

Corporate Social Responsibility (CSR) has been in existence for a very long time and has only gained significance and new relevance with each passing decade. Reference to CSR can be traced in management literature in the 1930’s and 1940’s but the contribution of business houses to social welfare was in existence much before. In the context of India, sewa and dana was part of the family-run businesses which believed in the punya or reaping the benefits of doing good for future. The concept of dana (giving) is notified in our ancient scriptures like Rig Veda.

As per United Nations Industrial Development Organization, ‘Corporate Social Responsibility is a management concept whereby companies integrate social and environmental concerns in their business operations and interactions with their stakeholders’ (UNIDO). CSR works on “Triple Bottom –Line-approach” which is achieving a balance between People, the Planet & Profit. CSR has developed into a powerful tool for advancing the Sustainable Development Goals (SDGs), with a heavy emphasis on social performance as seen in the organisations' CSR projects. Businesses have contributed to society in a way that has not only benefited people but also raised their standard of living.

The Companies Act of 2013, which came into effect on April 1, 2014, was the catalyst for the development of CSR into a legislation. The first official document that encouraged the social responsibility of business was the CSR Voluntary Guidelines brought out in 2009 laid down the framework of what constitutes socially responsible business practices. This came after the Ministry of Corporate Affairs (MCA) published National Voluntary Guidelines (NVGs) on Social, Environmental, and Economic Responsibilities of Business in July 2011.

According to the Companies Act 2013 amendment in 2019, CSR is permissible for:-

• Contribution to incubators or research and development projects in the field of science, technology, engineering and medicine, funded by the Central Government or State Government or Public Sector Undertaking or any agency of the Central Government or State Government;
• Contributions to public funded Universities; Indian Institute of Technology (IITs); National Laboratories and autonomous bodies established under Department of Atomic Energy (DAE); Department of Biotechnology (DBT); Department of Science and Technology (DST); Department of Pharmaceuticals; Ministry of Ayurveda, Yoga and Naturopathy, Unani, Siddha and Homoeopathy (AYUSH); Ministry of Electronics and Information Technology and other bodies, namely Defense Research and Development Organisation (DRDO); Indian Council of Agricultural Research (ICAR); Indian Council of Medical Research (ICMR) and Council of Scientific and Industrial Research (CSIR), engaged in conducting research in science, technology, engineering and medicine aimed at promoting Sustainable Development Goals (SDGs)”.

Earlier funding was limited only to government approved technology incubators located within academic institutions. This provision was rather narrow and restricted. Currently, the schedule VII of the Companies Act governs all research and development activities and implementation causes. These efforts are linked to 17 SDGs and 169 UN Sustainable Development Goal Metrics. Public Funded R&D laboratories now can offer their expertise, technologies and knowledgebase in many of the areas covered in Schedule VII of CSR. CSR has developed into a powerful tool for advancing the SDGs, with a heavy emphasis on social performance as seen in the organisations' CSR projects. Businesses can contribute to society in a way that shall not only benefit people but also raise their standard of living.

Importance of CSR in Research & Development (R&D): Corporates are increasingly recognizing the value of investing in R&D through CSR as a means of achieving both business growth and societal impact, particularly in areas such as healthcare, sustainability, and innovation.
Companies prefer social development causes (education, healthcare rural and slum development projects, livelihood etc) over any other areas for CSR investment. Companies prefer initiatives with tangible, quantifiable outcomes that can be achieved over a short period of time. Despite the opportunity, there remains a significant gap between available CSR funds and the amount currently being directed toward R&D projects. This untapped potential represents a major opportunity for research institutes to secure additional funding.