Hello everyone good afternoon i welcome
you all to help your ngos webinar on csr
toolkit matching corporates and ngos
where we are going to discuss the
compliances execution and the challenges
involved in csr without further ado i`ll
quickly introduce our panel for today
a first panelist is praveen kadle
praveen is currently the director of
tide water oil company india limited he
is also a member on the board of various
other renowned companies and has been
associated with the tata group for over
close to three decades praveen has been
a recipient of many recognitions and
awards and is also actively involved
with various public charitable
institutions
praveen holds a bachelor`s degree in
honors in commerce and accountancy is a
qualified chartered accountant cost and
management accountant and company
secretary it`s a pleasure to have you
with us today sir thank you
our second panelist is pierce tucker
pierce brings with him a rich experience
of over 20 years across large and
mid-sized indian and multinational
organizations of which 15 years have
been in the financial services industry
alone
tush is currently the ceo of quantum
advisors private limited prior to
quantum push was associated with mars
india
tush has a bachelor`s degree in commerce
and is also a qualified chartered
accountant welcome pews
thanks nishant to be here
a third panelist is nausea sector expert
and sector heavyweight nausea is the ceo
at cap through which he provides
compliance related advisory to
non-profits and corporate social
initiatives in a career spanning over 35
years in the non-profit sector nausea
has worked with a diverse range of
organizations he is currently serving as
a member on the advisory board of the
international center for not-for-profit
law and also serves as a trustee in
several foundations
nausea has authored several resource
books and serves as a guest faculty at
leading business school
it`s an honor to have you with us today
thank you
and i am nishant
i am a chartered accountant by
qualification and i had the research and
advisory services vertical at healthcare
ngo i`m the moderator for today
now before we proceed with uh the panel
discussion with our panelists let me
quickly take you through the evolution
of csr in india over the years
now since 2015 when this act came into
first financial year 2014 2015 to
financially in 1920 in a span of six
years 92 000 crore plus 92 000
crore plus has been spent on csr in fact
in just less than in just six years the
amount has more than doubled so now let
us see where has this money been spent
in terms of sector preference there are
certain favorite sectors that corporates
love donating money to the predominant
ones being education healthcare rural
development and to some extent
environment livelihood and vocational
skills
what`s also remarkable to note that
there are several sectors which have
received almost negligible money like
animal welfare senior citizen welfare
and sports infra development
now let`s see which parts of india
received how much out of this 92 000
crore worth of csr money
so again the uh spending has been very
very skewed the top seven states between
them have taken away almost 40 percent
of the total money spent total money
spent by corporates pan india includes
data of those companies who have
implemented csr in more than two states
but have not reported their spending
separately
again here there is a very stark
difference densely populated states like
uttar pradesh and bihar have received
very very little money
so let us try and understand from a
panelist as to what is it that
corporates look for and how can ngos
access csr funding
so we move on to the next segment of our
webinar today which is the panel
discussion
so my first question is for you nausea
you know the last financial year 1920
saw several major amendments in csr with
companies allowed to uh offset the
excess spend uh on csr that they have
incurred the government of india making
it mandatory for ngos to obtain
registration
if they want to access csr funds and
also making it mandatory for companies
to undertake impact assessment for
certain programs now in in the light of
all of this how do you think csr is
shaping up in india
thank you very much first of all nishant
i think the way i see it shaping up
right now from whatever and i`ve been
having a lot of interactions
with these
quite a few of them
and
i would say that right now companies are
feeling the forces that cstar is shaping
up as complex
complicated
compulsory
and a little bit confusing
and the serious feedback i`m giving
newponies are very very serious
uh
they have learned to leave sr and uh
what is expected out of it but they do
feel these four c`s complex
uh complicated
sorry now
gone are the days six years ago when uh
sure shame
uh
i mean why you did not do it give a
reason and move on that`s not there i
mean you better do that if you fail to
do it there will be fines penalties just
recently
we read in the paper how certain
companies are being for non-compliances
with csr etc we read about that so
is the going now you mentioned about two
or three aspects of the change law since
january
one is about
uh
this requirement all implementing
agencies csr implementing agencies
including the company`s own foundation
to register under csr1 in my opinion
this is a fairly simple process and
as far as things stand today it`s a
one-off
you
log in somebody else about your agency
etc society or a section 8 company
and you`re getting a unique ideation
number and after that many ngos seem to
think that oh now we have to report to
the ministry of corporate affairs also
the answer is no you do not so far that
is not envisaged the reporting to mca is
by the company and not by but what has
changed this until january
if the ngo had merely tax exemption
under 12 way it was good and that is
what is most important because income
tax gives you a 12a registration
now which is called 12ab
recognizing you to be instance for what
is quote
charitable purpose and that is enough
atg is a benefit that the donor gets but
now under the rules you need both 12a
and atg
now what`s the other downside
many organizations do not have 12aa they
have a better exemption which is under
1023c these are educational institutions
these are research institutions 1023c
completely ignored under csr1
even when taxability is concerned some
organizations have a better tax
deduction than the 3512 and 3513
which is about scientifically
statistical research and which gives the
donor 100 percent no talk about 35 one
to 35 country so this i feel is
something that ministry of corporate
awareness needs to take cognizance of
uh with regarding to
uh
the issue which you mentioned about
offsetting i think companies are more
than that i don`t think anyone is
scribbling about that that if i spend
three percent can i send it off to yours
i think no one maybe ngos may feel that
okay if they have already sent it off
maybe next year i may be in trouble so
so that is a possibility and there is
this
thing about impact assessment now again
with regard to impact assessment which
is required under the new rules is who
can do impact assessment for you there
is complete silence i mean do we go to
the big four can our chartered
accountant audio ad tax studies can a
privacy do it
what should be the track record of such
an agency
one matrix for impact first of all half
the time we use the term impact just
very loosely
please understand under the csr rule we
also talk about monitoring and
evaluation and monitoring and evaluation
is not to be confused with impact both
are exclusive mutually exclusive
so who does impact assessment what are
the matrix
how it is to be done
so
what i see is
how csr is shaping i think there is
increased control and lens requirements
and
fines and penalties are still there
maybe they took away the jail term which
was threatened last year
but uh the jail term is gone by the
fines penalties
show ensure show or shame
age is gone now just do it if you can`t
do it we`ll tell you how to do it i mean
there are always government funds you
can give it to
i`ll stop that nishant
right no very valid points nurses that
you`ve made and it always helps to have
have you because you give us insights
both from the nonprofit`s point of view
as well as the corporate`s point of view
so now now that you mentioned nausea you
know that it is companies earlier it was
complied or explained now it`s comply or
pay penalty right so on these lines what
do you think are the key factors that
companies should keep in mind while
framing their csr strategy
well first let me get into that because
you know i think only legally so now
companies
first make sure that whosoever you are
dealing with is registered as a trust
society or a
and which is now also renewed please
understand and the
12-way and atg is now given only for a
period of five years
some ngos are managed to get their
renewal under maybe
some have still not of course there is
still august so it is quite valid there
is even a probability that the
new date may be extended but please i i
don`t speak on behalf of the income tax
because the income tax bottle was
supposed to come out with a seamless new
portal on first of june and for those 50
days after this launch it currently went
haywire and it still has glitches which
has have not beast
so
uh that`s going to be another thing if
there is no further extension after 30th
of august which is at the end of this
month
companies are going to be very very
about giving funds to such institutions
ensure that the ngo has track record of
three years of service and that they are
registered under csr1 look at part pass
performance
i`ve also noticed that a lot of
companies
do not give grants to ngos they have a
works contract with them and charge them
uh for tds
at the rate of 10 because they think
they are providing a professional
service and therefore tds must be
deducted and then 194g they also insist
that the ngo should have gst and they
are quite happy and willing to pay gst
because of course they would get a tax
credit anyway for it but this is not the
way to go
csr must be given as a grant the grant
is in the nature of a gift please avoid
works contract i mean videos they exist
for
purpose so
uh that`s an important point i wish to
tell company about
more importantly give money to ngos now
in tranches i mean and the worst thing
that i see companies doing
offloading in the february and march and
then expecting the ngo to say okay i
mean how did you use my one crore of
rupees after offloading it in the month
of february and march at the end of the
financial year
i think not a good idea doing all that
so i i thought and again i know i`m
coming from an ngo perspective over here
i mean
uh
there is a lot of suffering that i see
out there and uh
there is a little bit of a disconnect
which uh hopefully seminars like these
webinars like this will help to bridge
so i`ll stop here
yes thank you thank you for sharing your
thoughts nausea and i completely agree
with the point that you make that you
know though ngos are receiving funding
it`s usually towards uh your early part
of q4 wherein companies suddenly realize
that they and they have an unspent csr
uh budget so in effect yes you know they
are going to do it you might as well
have better planning surrounding it
yes
now my next question is to you praveen
you know tidewater oil company has been
doing some fantastic work they are in
fact one of the earlier companies which
uh had focused or encouraged uh doing
renew of supporting development of
renewable energy as part of varma i see
that you`ve also aligned your csr
activities with your company`s strength
wherein you provide training empower
training to mechanics and garage owners
can you can you tell us
in short as to what is the factors that
the cons company considered while
selecting the sectors for support
okay so the uh withdrawal is the
the tidewater which has the brand of
widow
they are in the automobile industry and
typically automobile industry is
supposed to be
uh
you know
the
contributor significantly to the
economic
of the
or the environmental kind of issues in
terms of the
the uh
you know emissions and the
co2 kind of emissions and all of that
issues so
the uh from the point of view of
bringing the carbon neutrality
the company decided that they need to
really get into the solar power and
support that so to that extent they can
neutralize whatever they are
contributing to the emission so that was
the first point secondly of course uh
the solar power of course is uh least
expensive from the consumer`s point of
view so that was also the second point
and the third point of course is the
whole economy or the world is moving
towards the
you know whether it is immobility or
whatever you call in terms of how
the world can shift to the alternate
sources of
power so that was also the second point
and third point and therefore
this company decided to
use its csr money towards that kind of
objective the issue related to giving
the training to the mechanical uh people
or the mechanics is basically from the
point of view of creating more
employment you know you`ve got a lot of
uh
i would say uneducated but a lot of
youngster or young generation and we all
talk about in india we all talk about
the
demographic dividend which we have but
we if we have to really kind of convert
that so-called dividend
into real dividend and not
have demographic liability then we need
to have enough employment opportunities
especially to
the young
uh less educated people you know and
that`s why we thought we are in that
business and we should give the
training
in to the mechanics to the unemployed
and
i would say not fully educated kind of
for youngsters
to earn money either on their own or by
working with the garages or whatever so
that was the second
point of view so to give employment or
have employability opportunities for
them so that was the main update
very well said sir thank you and it`s a
very noble gesture to have uh such a
thought process where you think of not
just yourself but also the environment
in which your company is carrying out
its operations
thank you
pierce my next question is to you so you
are also a part of quantum csr committee
could you tell us what are the factors
that you considered while finalizing
your csr strategy and within that when
you`ve shortlisted the sectors for
support how do you decide on the fund
allocation within the sectors
sure mission thanks so just to clarify
i`m not part of the csr committee but we
work with the committee help them decide
on the projects so how do we
which factors we consider while
finalizing the csr strategy so very
early in our csr journey we realized
that to make a meaningful impact
with our limited budgets we need to have
a very focused approach towards our cs
suspense while we did not want to spread
ourselves too thin we also did not want
to be overly concentrated with only one
or two projects
so the factors we considered were
where the outcome can be measured very
clearly
where our support to a project can help
it becoming self-sufficient in few years
or create livelihood for beneficiaries
who are underprivileged
or underserved without any bias towards
any religion or community
where we can help create real assets
real capital assets and in recent years
similar to what praveen mentioned how it
helps us offset our carbon footprint
while the focus being still on creating
livelihoods
and the last being the availability of
viable projects near our geographical
area of operations to help us diversify
our cs aspect so looking at this we
selected two broad areas
education and rural health
education as it helps create livelihood
through our support for higher education
or night school transformation program
which helps school achieve a certain
grade so that they can start functioning
independently without the need for donor
support on a continued basis and rural
health
as it helps us create tangible assets in
the form of sanitation units or drinking
water supply
and talking about the fund allocation
between sectors so we did not we do not
decide a top-down fund allocation it`s
more of a bottom up approach where we
look at individual projects and select
individual projects based on this sector
priorities and the sector allocation is
an end result of those selection of
individual projects
okay thank you thank you for the inside
push now if i may just add to this so
we`ve already had the csr strategy in
place we know what we are to do the next
step would of course be identifying the
non-profits who would be in a position
to implement the program can you tell us
what are the factors that you considered
while shortlisting non-profits for
support sure so the some of the things
we look at are the trek record of the
ngo and their project execution and
monitoring capability
their awareness and knowledge about the
local area in which the project will be
implemented and the connect with the
beneficiaries or the local community in
that area
the scalability of the project purses so
that if the project is successful it can
be replicated on a larger scale in uh
like
if we are successful with one school can
we cover more schools for that
transformation program or if we are
successful with one village can we cover
more villages for making them
open defecation free so how scalable is
the project
community involvement in implementation
of the project that`s one of the key
areas for us in projects like rural
heads
and
how much of the budget will be directly
utilized for the project itself and how
much of it will be admin overheads and
with certain basic factors like nausea
mentioned about tax registration apg
approval etcetera so these are the
things we look at while selecting the
ngos
thank you thank you in fact uh i would
just like to mention over here that
quantum has been supporting its partners
for more than seven years now and we`ve
helped your ngo is the body uh assisting
quantum with its csr activities and
we`ve literally seen our partner
non-profit scaling up exponentially so
thank you pews
uh trevine if you could help us identify
i mean share your thoughts on what are
the points that your organization
considers while selecting ngos for
support
i think the first point i would like to
make this is basically extension of what
uh nausea mentioned as well as what bush
mentioned
you know we and this is i think is
should be the
kind of a
process which all the companies should
follow we all have you know
i`m talking about companies which are
basically
commercial organizations we all have our
budgets
we have a monthly reviews in terms of
what revenue we have achieved as against
the target and what were the issues and
so on and so forth
i think uh
every company and every csr committee of
that company should take this same
approach when it comes to the csr
monitoring and not just what like no she
mentioned looking at the end of the
year and how we spend the money or not i
think we should really have the budgets
like any budgetary processes
typically all the companies
before the new year starts you know
before the end of the march they
finalize their budget so csr budget also
should be finalized approved by the csr
committee approved by the board
and if not on a monthly basis the csr
committee should review it at least on a
quarterly basis and the way one should
look at is
this is not
kind of a
one-time
kind of a review activity or would they
go kind of a thing they clean up not
that way but really
monitoring order on a regular basis at
least on a quarterly basis like you
review the performance of the company
that`s what my advice is and that`s why
that`s what we try to do it in most of
the companies where i`m associated with
on the
ca software
typically uh your question was it refers
to what are the other things which
we look at
in terms of and i think both the points
which uh
which in fact not both all the points
which uh push made
we kind of look at those points very
carefully
i mentioned about the uh
you know the uh
the demographic dividend point which i
mentioned i think the corporate sector
should really look at how this so-called
advantage which we have or the dividend
that we have
can be really exploited by the country
as a whole and both the csr
organizations and the corporates can
really work together towards that and i
strongly believe that uh
you know if you don`t have affordable
education and if you don`t have
affordable health
you know all these young population
which we are talking about between zero
to say
a child which is born till the age of 18
and then they supposed to get into the
employment or earning kind of a
kind of a life
one should really provide the affordable
education and affordable health
otherwise it will become a big liability
and my personal belief is
both the ngos and the companies
should work towards making it happen so
when you showed the pie chart and you
showed that bulk of the money is
spending on education is being spent on
education and health
i`m not surprised the only point is one
should really look at it that how it is
being spent
in true
sense of
really creating a big positive impact
otherwise you know you have seen a lot
of wasted interest both in educational
areas as well as in the health areas and
that should be
kind of a
not encourage i would say discourage
very strong so companies when they are
looking at the
ngos from the point of partnering
they should really look at which are the
ngos which are really creating
big positive impact in these areas we
talk about rural development
fine
in the areas of rural development or
rural areas health and education are the
most important things
as compared to the urban areas so
therefore i look at it health and
education as the key primary areas the
other area i look at is
not so much about rural empowerment
rural
development but
women empowerment i think women
empowerment is another important thing
because
you know in rural areas
women are exploiting
and that is something which should be
avoided and therefore ngos which are
really
into
the woman empowerment area should be
encouraged and we look at that
kind of uh those injuries which are kind
of
working in these specific areas
right thank you praveen for sharing your
thoughts in fact the course of events
over the past one and a half two years
has pretty much made everyone realize
the importance of you of education as
well as health care and i`m sure
everyone also acknowledges that yes it
is high time that substantial funding is
given to these sectors
this uh nasher i was seeing that you
were quite in agreement with the points
that both pius and praveen made
especially with respect to having a
doing csr in a more organized way can
you tell me how can we get corporates to
be more serious about their csr and not
just do it like a one-time activity like
pravin said
uh
because i mean a common routine that i
hear from corporates is that
end of the day now they have made csr
something like a compulsory charity tax
and uh
this is literally quote unquote from
some companies uh that i mean uh you
know it`s far more
easier some additional
health education involved give it but i
mean you`re making me do impacting video
monitoring and evaluating you`re making
my um
making me go through all this rig bar
all i mean it`s easier for me if i give
you two as my charity tax and be done
with it
and certainly
smes small industries are literally
saying i mean the easiest way perhaps
for me is to give it to pm cares or pa
prime minister`s national relief fund
and that`s it after that if i give it
more or 50 lakhs nobody
did you do impact assessment did you do
monitoring and evaluation i gave it and
my compliance is over
and this is also a reality so how do we
make csr
interesting enough for me
first of all please understand that
india is probably among just one or two
countries that has mandated csr
even in the u.s and uk it is not
mandated and yet companies do it and
make it an important component of their
business
why because they see an enlightened
interest in doing css there is no one
who is monitoring them no one is selling
them have you done anything have you
done monitoring and evaluation do you
have a csr committee have you spent two
percent none of that and look at the csr
in those mncs all over the world and you
will find that csr is given that
importance because they see csr as an
investment in the economy it`s an
investment in the community
companies do realize that you cannot
have islands of prosperity in a sea of
poverty it`s as simple
you got to do in companies you cannot
say that people will buy my products if
the people are poor you`ve got to ensure
that the people rise above a certain
economic level you cannot say that in an
uneducated community my business will
thrive you build on that hr you need to
develop skills you need to invest in
education so that you get that right hr
so csr is an investment in the community
csr is an investment in the economy and
this is where we have failed to promote
csr we have reduced unfortunately csr to
a
mathematic if you meet the
turnover net worth profit
calculate two percent
as per schedule 7 these are the things
you can do make sure there`s a csr
committee make sure it`s support driven
process have you monitored it have you
even did it have you done an impact
study
talk of impact i mean
you want that after three years
you want that impact to be done do you
think impact can be measured after three
years or at least minimum one year of
completion impact sometimes cannot be
seen for the next 50 years
yes you can want you can evaluate you
can see how what`s the outcome you can
use a theory of change but impact is a
term
and
you make that mandatory if you are
spending more than 10 crores in a year
then impact assessment is necessary for
you
you cannot spend more than five percent
or 50 lakhs whichever is less on impact
assessment
how is this going to how is this their
recommending who who arrived at these
figures and how
and sorry i get a little carried away
with these kind of issues but i`m just
expressing like this right right now so
i think the bit that you mentioned about
impact and quantifying impact rather was
quite happily summarized by mr einstein
when he said that not everything that
counts can be counted and not everything
that counted can not everything that can
be counted actually counts
let me add to this the domain of indian
industry grd tada at one of the rotary
functions he was asked long before he
died
that how would you like to see india
and people thought he will say i would
like to see india as a superpower as a
super economic and he says i would like
india to be a happy
do not forget words of this doing of
indian industry i want india to be a
happy country can you do
the happiness quotient which bhutan is
known about that is the essence of csr
right thank you thank you for your
thoughts no and while we were at
the uh well we were discussing did i
think it would be a good time to just
see how our corporates doing their csr
how are they executing it in terms of
doing it in-house contributing it to
government bodies and taking the easy
way out because they do not wish to get
into the hassles of impact assessments
and other things that are involved so
like we can see from the slide 42
percent of the people who had uh for
whom data is available till fight 20
have outsourced their csr to a third
party and 32 percent of them are
companies who are doing it directly
in-house two percent is going to
companies set up by the central
government and for uh remaining nine
percent is going to uh trust a society
set up by the company in-house
now based on this uh push can you tell
us what was the rationale behind quantum
choosing to outsource its csr activities
as against doing it in-house
sure so it was quite simple for us
actually we looked at what expertise are
required to evaluate and do a due
diligence of project monitor
implementation and outcome on on an
ongoing basis
and can we build such expertise
internally in a cost effective manner
and the answer was no so there was no
point duplicating the infrastructure at
a higher cost so it was an easy decision
to outsource this to people who do it
day in and day out as this was not our
core strength
uh while we have outsourced the bulk of
the activity we also have our in-house
csr officer and two-member team
appointed internally uh which is not a
full-time position so this internal team
helps the board in taking decision at
the policy level at strategy level and
external agency complements and supports
the internal effort so we think it gives
us that added comfort and assurance
pews thank you
uh praveen could you tell us how are the
activity csr activities of vidal done
are they done in-house or have they been
outsourced and what was the rationale
behind the same
no whether it`s
tied water or whether it is tata
companies where i have been associated
it`s a mixture of
both in-house and using the ngos of
course in tata
companies we have the
the great advantage of having the tata
truss
you know there is a full kind of uh
what should i say full scale machinery
which has been there for ages now
and uh we
actually
uh in many data companies now we have
been diverting not everything rather we
are contributing directly to data trusts
rather than doing it ourselves
and there is a lot of alignment between
the
the objectives which trust setups and uh
what the individual companies have so i
think
there`s a complete alignment there so in
a way you can say tata trust acts as the
outsource partners and we do more or
less something similar in tidewater also
where we have
external agencies which have specialized
in the objectives
which we are setting up for ourselves
two hours for the csr committee and
partly we do it ourselves but we
have a
i would say
60 external 40 internal kind of a ratio
right right now i know we have
highlighted on the bit about you know
measuring program output and program
outcome and impact assessment but could
you just uh praveen quickly tell us that
how does your organization measure the
success of the program or the projects
that it has supported
yeah so i talked about education now as
uh roshi said you can`t really look at
education over just one or two years i
mean you need to really
look at let`s say you
have a child education started from
nursery or pre-primary primary whatever
and for the child to kind of get to
an educational level of even up to 12
standard you are looking at the impact
of 12 years or just
one year or two years and then
so we kind of
when we choose any particular
educational institution to be supported
we look at giving them the long-term
benefit
then of course
you can still and then how many kind of
uh students from that institution
passed and got some kind of a jobs
whether it would be
in the form of entrepreneurial jobs or
entrepreneurial rules or working
somewhere
not necessarily in the organized sector
but unorganized sector
that`s one criteria of looking at the
impact but here on here also we can look
at in terms of you know what`s the
passing percentage what kind of uh
you know the marks these students got
what kind of a
participation they had in the
you know extracurricular activities and
did they kind of
get certain awards rewards recognition
whatever
i think we encourage an all-around
development of a child and that`s where
we measure the
performance of the impact
kind of a
assessment
the areas in the areas of health of
course the you can say that impact can
be
seen much
more regularly than
what you can see in education so you can
see you know how many
patients were treated and they were
and we just not look at the
you know the normal medical centers but
we also look at some of the work which
is being done in the
you know long term
you know or diseases which have really
created a big negative impact on the
country
you know it could be in the area of
cancer it could be in the area of
uh we look at even child you know
nourishment or
you know some of these areas and how our
contribution can be very effective so
that`s how we try to
look at the impact resistance
yes thank you thank you and
i must say that this is where
ngos who specialize in this particular
impact assessment really help because we
don`t as uh mentioned
it`s not our business to really look at
and we can`t really hire those kind of
experts so it`s the best ways to go to
the specific ngos who can really do a
very good job in terms of impact
assistance and they are specialists in
that area
right right
yes yes praveen thank you and the point
that you make is also actually very
valid that you know one year three year
is too lesser time to actually identify
uh or to analyze the kind of impact that
of any particular program is making
so push my next question is to you you
know quantum has been supporting its
partner ngos for several years now
obviously is a lot of effort that goes
on from the ngo side to get a program
going do you think there should be some
minimum commitment from a corporate in
terms of the number of years of support
that it is going to provide to the
non-profit just so that the efforts put
in by the ngos are worthwhile yeah
definitely nishant i agree fully agree
with that and it works both ways
actually
not just from the ngo side because if
they get a commitment of long-term
support then they can plan their
activities based on that support and
they don`t have to worry about looking
for support on an year-on-year basis and
that program getting discontinued
because of that for the corporate also
it`s much more easier to commit to a
long-term project because the effort
which goes in
evaluating selecting doing a due
diligence on a project it is elaborate
and so if
if we get opportunity to support
something on a multi-year basis it works
best for us also because some once we
take a policy decision in one year based
on the annual milestones or outcomes
that project continues
for
three four five years but
we also look at
that
the project should be such that over few
years it should become self sufficient
and then we move to something else so if
we are supporting three schools for four
years and those three schools reach a
certain grade and then they are self
sufficient then we move to other schools
so the project continues the
beneficiaries change
then it the success is replicated so
it`s some in some sense like build
operate and then transfer
right right push i think that`s a very
uh very good thought process to have and
you know quite a lot of companies
actually guilty of making a one-off
donation or just supporting making an ad
hoc donation to meet the csr requirement
for that year and then just totally
disappearing on that note nausea could
you could you highlight or could you
tell us chavetas what are some of the
common mistakes that companies make with
respect to undertaking their csr
yeah sure i mean and what i have been
this has faq is literally every other
day is ngos are saying that companies
are now insisting that the ngo must all
so it its admin expenditure to only five
percent
please understand that the company`s csr
policy rules puts this cap of not more
than five percent on administrative
overheads only for the company read the
language of the law that
since the year
2014 when csr came into force the
legislative maintained it and what it
stands even today please do not impose
what companies have put upon you because
what was the legislative inter that
companies if they were doing csr on
their own then they should not be
putting all these admin costs with their
own staff under csr because there was a
fear that
older employees who would be put to
pasture will be given the csr portfolio
their salaries can be they will do a
little csr work and
that these were debated in parliament
when mr sachin pilot was putting this
matter in the parliament
this is one of the biggest mistake
companies i`ve seen making this year
itself in this financial year almost
every other day i get this query from
both companies and from ngos that we
have been told our administrative
overheads should not be more than five
percent sorry this is only for the
company not to be imposed on the ngo the
second one i think i`ve already spoken
about that is offloading in the towards
the end of the shell here please do
not do it please plan and now the school
say that you should have a plan of
action for the year i hope by by the
time the first quarter of the financial
year is over your plan into place and
you have started giving out money please
do not offload this in the last quarter
of the financial year
uh
another thing which i see is companies
confusing
their hr responsibilities for csr can we
vaccinate our employees vaccinating
noise is an hr response not a csr i mean
the company csr policy rules are very
clear in god what you do for your
employees is not csr it is hr
yes if you are doing it for the
community and where some of you is
incidentally may avail a vaccination
that`s a different story altogether but
do not try to pass these things off or
even pr budgets i mean okay so during
the pandemic uh uh you must wash your
hands and towards the end put a little
ad yes ours is the best disinfectant use
you know 99 percent kills the virus that
is your pr budget that is not your csr
budget you walk about the importance of
wearing a mask wearing uh using
sanitizing all that is good but if you
are using that as a platform to market
your then i`m sorry that is not csr that
is pr so these are some of the mistakes
and the other big mistake is
because it has defined an ongoing
project for three years
now it`s come to this that after three
years we will not support your ngo first
of all please understand when free or
ongoing project come in it kicks in only
when the company has underspend its
money if it has been
this
ongoing project loss does not even kick
in for you
so yes
as uh our friends here already spoke
about that commitment you want to commit
support to an ngo for five years go
right ahead and do that uh the project
can change its shape it can change its
direction etc but it doesn`t mean that
after three years you say bye bye i mean
i`m saying you should not create
dependency for the ngo but do not use
all these
stupid crutches that the triers have to
say bye bye to use you know
now it`s an ongoing project that ongoing
project has been three years it has not
said that you cannot support an ngo or
an implementing agency after three years
so please understand the nuances of the
law and that`s what i would like to say
over here
thank you thank you now the fact that
obviously you`ve highlighted that there
are multiple mistakes that companies are
making and there is a lot of scope for
improvement let us try and understand
from push as to what are the challenges
that companies are facing with respect
to their csr
so so i won`t say challenges but some of
the things which can be improved upon uh
and an aussie i would kind of flip your
argument about the end of the year
so we at times
when we are located at the beginning of
the year and the amount is dispersed
the ngos come back to us at the end of
the year with some unspent amount and
that creates a complication for us
so if we get better estimation on an
ongoing basis
or projections that this amount is going
to remain unutilized we can use that in
some other projects in a better way as
rules regarding unspent amount and carry
forward of the budget are quite
instringent and we would like to kind of
spend our budget in the year in which we
have allocated and as per the plan which
is given to us so some improvement which
can be done there
and also at the initial proposal stage
the groundwork can be done in a better
way so that the budgeting which is given
to us is proper and project doesn`t get
into cost overruns because again then it
creates a problem for us to take money
from some other project and allocate to
this project which is getting into
overruns etcetera so it works both ways
not sure from the corporate side also
better planning and from ngo side also
better estimation on an ongoing basis i
completely agree
and i go back to what i said earlier
that give money now in tranches even if
you decide to give it every quarter it
may be fine i mean or do it half
you know show us what you have done so
that you know you are able to ensure
that the entire two person gets utilized
and yes
if you are looking at also capacity
building unfortunately that`s a
provision that`s taken out of the
company csr policy rules which existed
but i think one of the capacities that
india
for ngos is just things around this
helping ngos to budget correctly helping
ngos to market helping men jews to
communicate better there is so much of
this kind of csr that can be done but
unfortunately csr as a lamborgh has been
reduced to an arithmetic
right but thank you i agree with you
so we`ll take one final question for the
panel discussion uh before we move on to
the next segment and so that`s for
praveen praveen we have a lot of friends
from our ngo uh representing ngos who
are participating today and almost all
of them would want to know the answer to
one very simple basic question how can
ngos access funds from corporates and
you know in our experience corporates
are slightly hesitant to support ngos
that are working at the grassroot levels
and you know usually they prefer working
with the popular ones who already have
good enough funding from existing donors
now do you think if a credibility
partner like help your ngo takes charge
of due diligence and program reporting
and monitoring copyrights will have an
added level of comfort and assurance in
going ahead and taking a bet on these
relatively small and mid-sized ngos
i think that would certainly help but
you know we need to have this kind of
monitoring
agencies like what you talked about so
that will certainly help
but i think
ngos also on their own should look at
what value they are bringing to the
table
for the corporates from the point of
view of really creating
a positive impact whether it is
measurable not measurable
in the short term long term is a
is a question which we can set aside
from time being but my point is are they
really going to do something which is
really going to contribute to the
society
that`s
and address the issues which the
country is facing
on the social economic front and i think
that is going to be the critical thing
and that`s what i would request the ngos
also to really do the
self introspection and really look at it
thank you thank you praveen so with this
we have a closure on our panel
discussion now we`ve seen as to what are
the challenges that companies face while
identifying csr partners so allow me to
quickly give you a brief of services
that help your ngo has to offer

now for our corporate clients we offer
ngo due diligence in respect of those
ngos that they`ve shortlisted for
support already we also have an option
of payroll giving where their employees
also can participate in doing social
good we also organize ngo events and
exhibitions for corporates and obviously
last but not the least we have csr
consultancy services
now i`ll quickly take you through the
csr advisory process that we have for
corporates step one begins with meeting
the non meeting the corporate
understanding their requirement and
based on that digging into our pool of
650 non-profits and paneled with
healthcare ngo and obtaining a detailed
proposal from them
once we`ve received this proposal a team
of research analysts that includes
chartered accountants will thoroughly
vet this proposal
and those proposals are those ngos
meeting two criterias one of course
meeting the donors giving strategy and
second help your ngos internal due
diligence norm will be shortlisted for
support
so typically healthcare ngos due
diligence norm covers multiple factors
such as ensuring necessary documents are
in place ensuring that the ngo has a
high percentage spent on beneficiary
ensuring that the program has a good
track record and more importantly has a
sustainability plan in place once we are
convinced about this what we do is we
share a proposal with the corporate
and then we assist the cooperate with
finalization of the mou as well as the
grand dispersal process
and the fourth step is with something
which is ongoing in nature with which is
monitoring and evaluation now a team of
analysts are in regular touch with the
non-profit to know what what is the
development happening at the grassroot
level in addition to this we regularly
provide our donors with a fund
utilization statement as well as a
program report
so corporates have the option of
outsourcing their csr to help your ngo
since we have the expertise to execute
end-to-end csr services
now for our partner ngos we know that
they need to support they need to submit
proposals to obtain grants so we assist
them in the proposal writing process we
also help them in getting the
facilitating the grant dispersal as well
as helping them out with preparing a
template for report or preparing the
reports on their behalf that they need
to submit to the donors
now through the multiple programs that
we`ve supported over the years have
facilitated over the years we`ve covered
a wide range of unsdgs now in the course
of the next few slides i`ll be quickly
taking you through some of the programs
that we`ve supported
so we support one of our partners had
supported
a rural health improvement program which
basically involved construction of
sanitation units to make several
villages hundred percent open defecation
free
then we have certain programs in rural
rajasthan which were pertaining to
education as well as menstrual hygiene
management a topic which is still
considered as taboo in many parts of
india
this was a unique program wherein
digital literacy was imparted to
students studying in government schools
and night schools by way of a mobile van

and owners choosing to offset their
carbon footprint and enthusiastic
villagers joining in the whole tree
plantation drive
these are some of our clients who`ve
chosen to partner with us availa
services for doing social good
thank you thank you for listening to me
for allowing explain the wonderful work
that help your ngo does now we`ll
quickly move on to the last segment of
today`s webinar which is the q a session
we`ve already been receiving several
questions from all our participants for
all the panelists uh i think it`s
already 450 so we`ll try and take as
many questions as we can
so the first question uh nausea is for
you
how is
how is the sector coping with the
reduced access to csr funds
considering yeah
last year in particular i mean because
of covet a lot of money went uh for coed
relief and rehabilitation uh also pm
cares uh
mopped up a lot of csr funds as we all
know from the statistics available to us
but how did they
mean uh
you used every problem
of
whether a resilient organization they
find a way around and so some resorted
to
raising money through crowdfunding using
social media
some who had purposes and reserves
were lucky enough to dip into those
corpuses and reserves that they had and
were able to sustain themselves
and yes unfortunately many organizations
that i personally know also had to
resort to cutbacks back on their
spending
their on certain programs and
they also had to retrain staff and
actually seen that happening and we know
that whether it`s in the for-profit
sector or non-profit sector people have
lost livelihoods and jobs so
i mean those everybody could not work
from home so i mean
so
i think the
moral and lesson that we learned from
2020 onwards is that do not rely on any
one source of funding i mean do not
create dependency on csr do not
dependence only on foreign funding these
things can change
just as in your investing world you talk
about don`t put all your eggs in one
basket and
investment in mutual funds market risk
in right manner working in the nonprofit
sector is subject to all these funding
risks
so
i mean keep your options wide i mean
there are
uh various studies including studies
done by sukhoi et cetera shows that
individual giving is always today
perhaps we are emotional is the neighbor
before in this country but i mean
how are we going to do that what sort of
resources have we created to tap into
that perhaps institutions like quantum
and help your ngo can
jump into those hnis and ultra hnis and
become the platform for mobilizing those
resources for ngos
right right including your investors
including your investors
thank you thank you
so uh praveen my next question is to you
with government offering better covert
19 related csr benefits to copyrights
would corporates still be keen to
support other programs

so what do you mean by other programs
so the ones which are not eligible for
csr i mean which are eligible for csr
but not qualifying under covert 19.

yeah i
i don`t know what the specific question
is but there are so many kind of you
showed the pie chart right and in the
pie chart you showed so much of uh money
being used by corporates or by other
institutions towards the csr activity
that focus will still continue in
whether there`s a kovid or not so i
think
i think the companies or enterprises
will still look at this supporting this
causes and
one should really look at supporting
this process
right right
now uh push the next question is for you
quantum has developed its own
proprietary esg score does quantum csr
policy reflect the framework that its
funds managers are adopting
sure
so when we evaluate companies on esg
from our fund management side csr is one
component that we evaluate and while
evaluating that we look at factors like
whether the company has met the minimum
two percent spend requirement
if not met whether they were genuine
reasons for the same like they were
funding an ongoing project multi-year
project etc we also look at the quality
of the csr spent whether the spending
itself is genuine and who are the
beneficiaries whether it`s directed
towards vulnerable and marginalized
section of the society and for example
if the csr project is building in a
capital asset like an educational
institute with sections of the society
that institute will cater to is it only
for the employees of the company or the
fee structure is such that only rich can
avail admission then we don`t view those
efforts by the companies positively and
we score them uh poorly in our scoring
mechanism
also once the spending is done is there
proper mechanism and measuring and
monitoring the outcome and impact
many times companies implement their csr
through their own foundation and i saw
some comments in the chat about that so
this itself is not bad but what`s the
level of visibility on utilization and
activities of that foundation or the
money is given to foundation it`s lying
they`re unutilized it`s just a tick the
box approach so if there are such cases
then we don`t rate positively
corporates on these factors and when we
evaluate our csr policy outcome we
evaluate ourselves based on the same
factors who are the real beneficiaries
how the amounts were effectively
utilized what was the outcome and the
impact and how it compares against the
targets so we put the same lens on
ourselves also through which we evaluate
other companies in our investable
universe
right thank you thank you for sharing
this view now while we are in the topic
of esd uh praveen there`s a question for
you it says that copyrights that would
be rated poorly on esg tend to use csr
fun just pr will mandatory esg make
corporates better and more sensitive
yeah i think
i would say that esg is something which
is
we are doing business
and it should not be treated as a pr
exercise
you know good companies need to
contribute towards
environment
need to contribute towards meeting the
social objectives each company would
have its own
different objectives on the social front
and lastly
but not the least important thing is
each company should spend
enough attention money whatever you want
to call and have the processes
in terms of having a sound corporate
governance system
so i think esg is way of doing doing
business it`s not something which is
to be dictated by government regulation
or to be done by
because you feel uh it`s now obligatory
it shouldn`t be taken as a good soft
corporate citizens road
in terms of ehd
so i would say that
every company should be taking this as a
part of their doing the business
and not something because of there`s
some regulation or whatever
right
thank you thank you praveen now uh not
sure the next question is directed
towards you is fcra registration
advisable to be obtained in the current
socio-political and legal scenario
oh that`s a loaded one
well if you are if you`re going to be
receiving uh
csr
gram
a branch of a foreign company or
a subsidiary of a foreign company which
is not registered under the indian
companies act you i mean if you want to
tap those monies you will need fcra but
as you know that fcra is a very complex
piece of legislation
the
uh
perhaps one of the most draconian pieces
of law that ngos have to deal right now
roughly around 20 to 22 000 ngos are
registered under fcra once upon a time
there was upwards of 14 of them
many have been deregistered some of them
rightly some of them wrongly
but
ngos have to go through hell and back
for registering
uh for renewal
including provisions now of opening a
pacific bank account with state banking
a new delhi main branch
uh and even after opening that they are
going through all the hassles of okay
the money has come but it is still not
credited into my account and
that`s a different i mean
you could have a separate webinar on fcr
initiation someday i`m happy to talk
about that but it`ll touch our raw nerve
if i start talking about it
sure no sir thank you so push the next
question is for you
uh
mr pugh can you share some success
stories of the programs that quantum has
supported so far yeah would be happy too
so the rural sanitation project which we
supported started supporting from 2015.
we started with one village with
construction of 30 sanitation units and
over the last five six years we have
covered 16 villages
uh constructed over 500 units and helped
to make those 16 villages open
defecation free so that`s
like an uh success for us
in our night school transformation
project
we helped two schools improve their
grades from grade c to grade a which
will help them become self-sufficient
and they can be on their own going
forward
in
and one particular story i want to share
about our higher education support cell
so there was this individual from
rajasthan he was living in mumbai and
due to family emergency his father
passed away he had to move back to
rajasthan leaving his education in
between and once he came back it was in
the middle of the year so he
passed ssc through the night school and
after that
he became aware of our
long-term capital
long-term education support program and
he enrolled for that he enrolled for
doing chartered accountancy he`s cleared
two levels of chartered accountancy as
of now and he is waiting to give his
final exam so these are the stories
which give which are which give you a
sense of fulfillment which are
heartening and you see for us it`s two
percent and our two percent making a
more than hundred percent difference in
the life of people
that`s like uh we that`s that makes
those four c`s nausea which you talked
about it makes worth tackling those
forces
i agree i agree the these are human
stories and this is the real impact
these are not the matrix that mce mca
wants you to be measuring i mean they
are looking at
some esoteric abstract impact and again
when we speak of impact i mean uh
on what matrix that is still unknown to
us
right
thank you thank you for sharing uh the
success story reviews now uh i know it`s
already five but with the permission of
our panelists could we extend the
webinar for another five to ten minutes
since we have a lot of questions coming
in from the audience surely
thank you problem
thank you thank you
the next question praveen is for you it
says that given the momentum that esg
has gained in recent times should the
esd score of a company start reflecting
on its stock price to get companies more
conscious about the impact of their
business activities on society
so question to me
yes praveen
yeah esg score uh will it get reflected
in the stock price
i`m not too sure i`m not an expert and
push can talk about it because he`s in
the same business
i think the stock market many times
behaves completely
independent of
what companies do
they all say that stock market sometimes
behaves irrationally
so
i would
leave it at that and request to use to
comment on this particular point because
i am not in a position to correlate the
ehd score and the stock market price
robot views yeah so
nishan the
basic premise is that
better esg practices by corporate would
lead to a better esg score and better
esg practices by corporate would make
them sustain better
uh tackle business challenges better
would in
short medium and long term improve their
profitability which would eventually uh
reflect on their stock price
so yes better esg would reflect in
better stock prices over time
yes
doing the right things repeatedly over a
period of time to fetch results piece
yeah as praveen said over the short
terms markets may be rational and the
price may not reflect value but over
long term it will reflect the values
through the better years you practices
yes thank you pews
so the next one is for me it says what
is percentage spend on beneficiaries
that i covered in my earliest life so
sure i`ll be uh happy to explain this so
percentage spent on beneficiary
something that help your ngo has device
it`s basically giving the donor an idea
as to how much money is actually being
utilized towards the end beneficiary so
in effect say an ngo has a percentage
spent of on beneficiary of 89
so this means that 89 out of 100 rupee
donation made by you as a donor 89
rupees is directly being utilized for
the welfare of the beneficiary and
another 11 rupees the balance 11 rupees
is being utilized towards admin expenses
fundraising and so on in fact healthcare
injury is the only organization in india
which arrives at such a number and users
of our financial statements of our
websites find this uh information to be
very very useful in fact someone from
the helper ngo team could just uh share
share the page i`ll be able to just
quickly take you through that

okay i think
that`s fine
maybe there`s a
yeah
yes so we see right at the top we have
for this non-profit massoum
the percentage spent on beneficiary is
989 percent now when we go slightly
lower
we know that okay out of this 89 out of
100 rupee donation that a donor has made
89 rupees is being utilized being
utilized for direct activities which are
contributing to the beneficiary and
remaining 11 rupees are going towards
admin and other overheads so in effect
what our team of research analysts does
is analyze the financials of these
non-profits and standardize them to
facilitate easy comparison so no matter
whether the company whether the
nonprofit is registered as a section 8
company as a trust or a society and no
matter what format you are using to
prepare your accounts on help your ngo`s
website the data is completely
standardized to facilitate easy
comparison of different ngos
thank you
the next question is again for you
nausea
it says since there is no clarity on
impact assessment how can ngos meet this
criteria while working with csr funds
from companies who have limited in-house
capacity for measuring impact
so impact assessment is a
duty that has been trust upon the
companies and not on the ngo
you merely cooperate
company that will identify who will do
the impact assessment of the project uh
which is there on your part you merely
provide the data and information provide
your cooperation towards that
this is not on the ngo so
i do not see this as something for you
to lose sleep over i mean
let the company figure out who will do
the assessment
will another ngo do this will it be a
company will it be one of the big force
doing it uh
who does it leave it to the company to
decide
you merely cooperate
okay okay
so we`ll take one final question for
today which applies to all the three
panelists what does the future of csr in
india look like
nashville you could go first
well the csr future does look promising
because if we look at these statistics
that we saw csr is on the rise there is
giving and now because it is being
mandated you have to spend two percent
uh certainly figures will
show but who is taking most we just saw
that it`s skewed there are certain
states that get most
operational areas are not getting enough
there are education and health care is
mopping up uh whereas sports
arts culture
continues to remain neglected
cause of the elderly and we are an aging
population yes i mean uh yes i mean we
have more youth today than
uh ever before but there is also a huge
elderly population and
there is need for addressing those needs
also there is nitty and there is a whole
bunch of problems that is not and i
think what i would say is that
is really to grow in india
then csr also needs to be incentivized
by the government that uh
first of all as we know the csr is not a
business expenditure it is not something
that you can deduct under section 37 of
the income tax act it it is a mandatory
spend that you do at best under 80 you
will get a 50 percent tax deduction
if you spend on csr allow 100 tax
deduction incentivize it that might be
helpful
let companies
give off their products there are many
companies you`re doing who wanted to
give off their
medication oxygen concentrators but that
didn`t count as csi
uh so what was you give money to an ngo
and which in turn will buy those
equipment or the medication and use it i
mean why go the roundabout way when the
company will happily give its medication
it will give and i`m talking of medicine
only because it`s over times but even
otherwise computer companies could give
that whatever they are mentioning it may
be computers it may be tablets and let
that be counted as csr employee
engagement which is the big chunk in csr
giving in the us and the uk they say our
employees gave so many thousands of
worth of employee time engaging with
communities that is not factored in
their csr so i come back to the thing
csr is reduced to a charity tax
get to the essence and the spirit of csr
and i think if you incentivize csr
perhaps it will be good for this country
uh it is here we away
compliance burdens will be there it will
remain complex
but then when we hear stories as they
appear related to us perhaps those four
seas that i started out talking about
may be worthwhile so i agree with pio
show over there but that would be my
thought
thank you thank you
uh praveen your thoughts on the same
i think the uh
corporate sector`s attention towards csr
is definitely a positive thing whether
it was because of this csr regulation or
not and i agree with uh no that it
should be
allowed as a tax deductible expenditure
because today
it`s still not a resort issue in fact
there is still a lot of litigation on
that
and it should be resolved by the finance
ministry or tax department or whatever
but i think one good thing is thanks to
this regulation
companies are definitely looking at
achieving or looking at these all these
social economic issues in the country
and of course some of the companies are
genuinely
looking at this esg issue which was
referred to earlier i think that`s a
good positive development
profits of the companies are increasing
so it`s also another good thing that two
percent of the profits as the profit
pool increases the amount of they will
also increase so that`s also a good
positive thing so i think overall
i would say
it`s a
what government has done directly or
indirectly has
is suddenly going to help
so
thank you thank you praveen pews your
thoughts on the future of csr in india
sure ben before i get there i saw a
question in the chat a few minutes back
about
why amc`s are not generous enough to
launch mutual fund schemes which would
allow investors to donate for
development goals so just want to tell
that for quantum mutual fund it`s
already there in place for last few
years you can invest in any quantum
mutual scheme and through the smile
option
give to a ngo or cause of your choice
annually and you can decide the
percentage so that facility is already
there and we hope that more mutual funds
and more amc`s adopt that
coming to the future of csr in india i
agree with the nausea and praveen it`s
promising there are challenges
but more and more corporates are
giving it the attention it deserves in
the right spirit
with the growing focus on sustainability
and esg
and with
the the inequalities which are brought
in by this pandemic the growing
inequalities
all this has put focus on csr and i
think if as noshi said some of the
challenges can be resolved by government
of things can be made slightly easier it
would be better for everyone
yes yes please thank you thank you for
sharing your thoughts so quickly to
summarize uh what we`ve discussed you
know so we all agree that yes csr is
here to stay company is going to grow
over a period of time as a result of
which the funds flowing out to ngos is
also going to drastically increase over
the years so and ngos now also have an
insight as to what it is that corporates
look for
so all said and done you know one with
with all its ups and downs what the year
2020 has done for csr is that it has
officially appended the csr movement for
most companies and they`ve now actually
taken that path towards doing the csr
activity in a much more organized manner
with this i would like to conclude
today`s webinar and i would like to take
the opportunity to thank our panelists
not just for their time but also for
their generosity to share their
knowledge with us thank you nausea thank
you pews and thank you praveen thank you
thanks for having us
thank you and i and i hope our
participants enjoyed attending the
webinar as much as we enjoyed putting it
together for all of you
thank you thank you thank you all
stay well thank you
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