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Corporate social responsibility not a charity, says Moily

The new Companies Bill, which is expected to be tabled in the monsoon session of Parliament, will make it mandatory for the corporate world to set aside 2 per cent of the profits as part of Corporate Social Responsibility (CSR) in backward districts.

Talking to presspersons here on Monday, Minister for Corporate Affairs M. Veerappa Moily said there were 300 backward districts that had not seen any investment. He expected the corporate world to do its share by way of infrastructure creation or capacity building of the human resource.

Mr. Moily said: “We have about 300 districts where no investment has taken place and hence roping in the corporates to contribute 2 per cent of their profits will be a step to get them involved. I am not seeing it as some kind of charity but I see it more as Corporate Social Business, which will ultimately benefit the corporate world. Though I am not satisfied with 2 per cent and would like to go higher, I am looking at the larger social impact of such a move. While 2 per cent contribution will be mandatory, there will be some clauses to provide for exceptions.”

Social change

The Minister said he looked forward to talking to corporates and the concept of investing profits as part of the CSR could turn out to be an agent for social change in backward districts.

Deflecting questions on reservation in private companies, he said this debate was going on for long.

However, he referred to the proposed mandatory clause of 2 per cent investment for CSR, saying this would be akin to some affirmative action that would benefit society.

Lokpal issue

On the Lokpal issue, Mr. Moily said the government was keen on introducing the Bill in the monsoon session. The scourge of corruption had to be tackled through legal and constitutional means. “There are a few representatives in the civil society who want to go beyond the existing law but in the Indian democratic system, it is Parliament that is supreme and the Lokpal Bill has to be within the purview of the law and the Constitution.”

Referring to the Lokayukta report on illegal mining in Karnataka and its implications, Mr. Moily said he would not like to comment on a fragment of a leaked report but would study the same when it was made public. The BJP had to respond to the new development as there was a question mark over its commitment to fight corruption.

If the Lokayukta was serious, he could make a declaration under Section 13 of the Lokayukta Act to seek the Chief Minister's resignation and refer it to the appropriate authority.

Refuting suggestions that he felt belittled of being divested of the Law Ministry, Mr. Moily said he was happy about some of the initiatives taken during his tenure, including the decision to reduce the high rate of pendency in courts that would have a bearing on the future.



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