october 2021

Smile Foundation

IN FOCUS 3

Impact: CSR Spending on Pandemic Relief Efforts

Rs. 1,00,000 crore.

This is the amount that has been spent on corporate social responsibility (CSR) in India since it was made mandatory seven years ago. Notably, 40% of these funds were spent in the past two years only, after the COVID-19 pandemic hit.

Overall CSR spending in FY 2020 was Rs 21,231 crore. In this, 1,387 listed companies accounted for about Rs 14,431 crore (~26% more than in FY 2019), and 19,962 unlisted companies accounted for Rs 6,800 crore (~7% less than in FY 2019), a Crisil report states.

The enormity of these figures is something that needs to be noted. This is because one must also consider where all these CSR funds are going. When the government added COVID relief to the list of approved CSR activities, companies rallied their funds towards this cause. The trends saw that as the pandemic got aggravated, a growing number of corporate started opting for more in-kind direct interventions.

This is where development organizations such as Smile Foundation have been playing a major role. If we look at some of our own biggest corporate supporters, we can begin to assess the impact that CSR funds are having on pandemic relief work.

PepsiCo Foundation and PepsiCo India have spent approximately Rs 6 cr with Smile Foundation. These funds have been used to provide 4.5 million meals to over 10,000 daily wage workers and migrant workers. PPE kits were distributed to over 50,000 frontline health workers. Along with this, life-saving medical equipment and hygiene kits were also donated using these funds.

Deutsche Bank has spent Rs 5.85 cr on COVID relief interventions implemented through Smile Foundation. Families and frontline workers in Mumbai, Pune, Jaipur, and Bangalore have benefitted from these funds. More than 11,000 families were given ration kits and more than 2600 frontline workers were provided with PPE kits using these funds.

The CRISIL report also said, “Given the severity of the second wave, support largely came in the shape of supporting the healthcare infrastructure with equipment such as ventilators, oxygen concentrators, cylinders, testing kits, and donation of food/ration where an exact monetary value could not be ascribed.’

Strengthening the healthcare infrastructure and oxygen repositories also emerged as a major source of CSR spending during the pandemic. S&P Global Foundation and S&P Global have allocated Rs 3.7 cr from their CSR funds towards COVID relief efforts. The funds have been used to distribute 83 oxygen concentrators and 8,000 PPE kits to government hospitals in Delhi NCR. Additionally, ration kits were also distributed to 10,200 families in Delhi, Haryana, Telangana, Maharashtra, and Gujarat.

As per estimates presented in the report, India Inc would have spent Rs 22,000 crore in FY 21 on CSR activities. This shows a growth of 3.2% from the previous year. A majority of these funds have been allocated for pandemic relief efforts.

The successive waves of COVID-19 have been a litmus test of corporate altruism. Employee well-being initiatives, business imperatives, social contract, and the government’s CSR mandate all have to be balanced while spending CSR funds.

As of 3 May 2021, corporate India had already committed Rs 5,806 cr towards India’s fight against COVID-19. The probability of diverting more funds during this FY 21 seems imminent.

Our understanding and on-ground work has lead us to believe that given the COVID situation in India and the pace of vaccinations, at least for the next one year or so, corporates would continue to prioritise their activities in and around COVID-19. Most CSR activities would be COVID compliant. Thus, NGOs will have to recalibrate the definition and scope of their processes so that even non-health related causes can go on without disruption despite the pandemic.

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