March , 2021
CSR activities of PSUs
13:45 pm

Kishore Kumar Biswas


The Companies Act, 2013 replaced the nearly six-decade old legislation that governed the way corporate functioned and were regulated in India. Under the Companies Act, 2013, the profitable companies with a sizeable business would have to spend every year at least 2% of three-year average profit on Corporate Social Responsibility (CSR) works.

This is not applicable for all companies. This would apply to the companies with a turnover of `1,000 crore and more or net worth of `500 crore and more or net profit of `5 crore and more. As per those proposals, from the beginning of 2013-14, it was seen that some of the top earning PSUs like ONGC, BHEL and NTPC had to increase their expenditures on CSR as per the those guidelines. The guidelines were made by the Department of Public Enterprises (DPE).

PSUs with net profit between `100-`500 crore were required to earmark 2%-3% of their income. Each of the company responsible for the programme has to ensure that it must spend full amount earmarked for, otherwise it has to disclose why it can not spent the fund. 

Basic ideas for CSR

It is known that the CSR activities are undertaken under the heads identified under Schedule VII of the Companies ACT 2013, with special focus on health, nutrition, sanitation, skill development, rural development, women empowerment, environment centric initiatives and care for the elderly and differently-abled persons. So the areas in which the CSR activities are to be done is legally fixed.

The initiatives taken by the companies preferably should be in the nearby areas of the district where the companies are established. The activities are undertaken by PSUs themselves or through agencies or departments as per their approved procedures. Actually there is no basic difference of rules and laws for PSUs and private sector companies in implementing CSR projects.   

The PSUs with a profit of less than `100 crore are required to contribute 3% of their income for undertaking such activities. The guidelines state that if PSU's are unable to spend the earmarked amount for CSR in a particular year, it has to be spent in the next two years. The guidelines continue to exempt sick and loss-making PSUs from allocation of budget for undertaking CSR activities. So if there has been any unspent amount remains in a particular that must be carried forward in the next year. In fact, all the projects are of three years duration. But if any project remains incomplete after three years then that should be stopped. The money left with the company under the programme is to be transferred to the government. The oil PSUs spend good amounts in CSR projects as most of them have been earning good amounts of profits.

PSUs under limelight for their CSR activities

Western Coalfield Limited (WCL) in its new CSR initiative has tied-up with the Central Institute of Petrochemical Engineering and Technology Bhopal to train 57 rural youth living in around its operation as machine operators and in plastic processing.

Mazagon Dock Shipbuilders Limited has been actively supporting the nation’s effort to fight the Covid-19 Pandemic. To support the Government’s Covid-19 vaccine drive it has gifted a refrigerated truck worth `32.

Power Finance Corporation Ltd, a leading NBFC in the power sector has extended financial support the construction of stilt plus a two storied school building at Dr. KB Hegdewar School premises in Bambolin, Goa as part of CSR activities. 

Amrapali Chandragupta areas of Central Coalfield limited have started a ‘Sewing Training Centre’.

Northern Coalfields Limited organised free general health camps in nearby villages.

NTPC Bongaigaon and Kokrajhar Municipal Board have joined hands for a Clean and Green Kokrajhar.

SJVN Limited, a Mini Ratna and Schedule a CPSU, organised a motivational talks by Dr. Gaur Das for all the employees at head quarters.

Indraprastha Gas Limited has been undertaking several CSR projects coving various focus areas. 

Easter Coalfield Limited organised a free cataract camp Jamgram village in Bardhaman District. 

Powergrid Western Region II provided a 6.5 cubic metre capacity truck-mounted vacuum road sweeping machine at a cost of `79.14 lakh to Bhopal Municipal Corporation. 

In this way the PSUs have been organising CSR activities in the country. In most of the cases those have done good jobs for the common people. 


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