Spending rule to state-owned enterprises such as State Bank of India (SBI) and those formed by special acts of Parliament including Life Insurance Corporation of India (LIC), the government may widen the mandatory corporate social responsibility (CSR), officials with direct knowledge of the matter said on condition of anonymity.
Companies above a certain size have to spend 2% of their average profit (for the past three years) on CSR activities.
A high-level committee, which submitted its recommendations on Tuesday to the government, suggested extending CSR obligation to banks registered under the Banking Regulation Act, 1949. “The applicability of CSR provisions may also be extended to similarly placed entities not covered under Companies Act through necessary amendments in Companies Act and, if necessary, in their respective statutes,” the committee said in its report.
A finance ministry spokesperson confirmed that the committee has submitted its recommendations to the government and the same would be considered by it. SBI and LIC did not offer any comment. SBI’s website, however, said that the bank has been undertaking CSR activities since 1973. It said that the bank is required to spend 1% of its profit on CSR work as per Reserve Bank of India (RBI) regulations.