Mumbai: Asking India Inc to embrace the concept of 'growth with equity' as part of their Corporate Social Responsibility (CSR) motto, Vice-President Mohammad Hamid Ansari Monday said industries should voluntarily take up community projects instead of being pushed by laws to to do.
He said there was a great scope for the business community to undertake CSR efforts.
"The answer, however, does not lie in enacting new laws to make CSR mandatory for all. It has a greater chance of success through voluntary commitments by all able enterprises, in private or public sector. This would be a win-win proposition for the businesses and the society in which they exist and flourish," he said, addressing a financial conclave organised by the Indian Merchants' Chamber (IMC) here.
Ansari called upon the captains of Indian industry to embrace the concept of 'growth with equity' as part of their CSR motto.
"Empirical evidence shows growth without equity is not sustainable in the long run. Desired levels of equity can't be attained without rapid and sustained growth. Hence the solution is not in 'either-or' but in 'both'".
The Vice President said businesses promote growth directly by increasing production and they help in inclusion by generating employment and creating wealth.
He said the Companies Act, 2013 has brought the idea of CSR to the forefront by making it mandatory for certain class of enterprises.
After the changes made in the Act last year, every company (private or public), which either has a net worth of Rs 500 crore or a turnover of Rs 1,000 crore or net profit of Rs 5 crore, needs to spend at least 2 per cent of its average net profit for the immediately preceding three fiscal years on CSR activities.
According to Indian Institute of Corporate Affairs, at least 6,000 companies are required to undertake CSR projects under the provisions. Some estimates indicate CSR commitments from companies can amount to as much as Rs 20,000 crore.
Ansari observed that CSR in India has traditionally been seen as a philanthropic activity. "Over the years, it has evolved from institution building to community development through educational, cultural or research projects."
He called for allocation of more resources for uplift of weakest segments of society.
Maharashtra Chief Minister Devendra Fadnavis said, "To eradicate poverty, the country needs investment, new jobs, wealth and value creation."
