CSR push: Listed firms' spending jumps 23% in FY25 on robust profits, Pg15

Key Highlights:

• CSR spending by listed companies surged by 23% in FY25, reaching Rs 22,212 crore, driven by robust corporate profitability.
• 98% of mandated firms, totaling 1,521 companies, reported CSR expenditure in FY25, up from 1,372 in FY24.
• Education received the highest CSR allocation at Rs 1,157 crore, followed by healthcare at Rs 840 crore.
• The CSR framework in India, effective since April 2014, mandates eligible companies to spend 2% of their average net profits on CSR.

Detailed Insights:

• The increase in CSR expenditure is attributed to a 22% growth in the average net profits of listed companies over the preceding three years.
• After a period of stagnation, CSR spending is showing strong recovery, with a 16% increase recorded in FY24.
• While most companies increased their CSR commitments, 28 companies failed to spend any amount despite being obligated.
• Education and healthcare sectors receive the most funding, while areas like slum development and disaster management receive minimal support.
• The CSR mandate applies to companies with a net worth of Rs 500 crore or more, turnover of Rs 1,000 crore or more, or net profit of Rs 5 crore or more.

Key Concepts Involved:

• Corporate Social Responsibility (CSR): A self-regulating business model that helps a company be socially accountable to itself, its stakeholders, and the public.
• Net Profit: A company's total earnings after all expenses, including taxes and interest, have been deducted from revenue.
• Financial Thresholds: Specific financial criteria (net worth, turnover, profit) that determine a company's eligibility for CSR obligations.