Bhaskar Chatterjee, director general and CEO of Indian Institute of Corporate Affairs (IICA), a think tank under the aegis of the union ministry of corporate affairs, retired last week after five years at the institute. Credited with drafting the Corporate Social Responsibility (CSR) Rules, 2014, Chatterjee traces his engagement with the corporate world back to 2009, when he was made the secretary at the department of public enterprises (DPE).
It was here that the blueprint for CSR Rules was prepared with a similar directive to government-owned firms that they spend part of their profits on social development.
CSR Rules 2014 direct firms with a net worth of Rs500 crore, a revenue of Rs1,000 crore or a net profit of Rs5 crore to spend 2% of their average profit in the last three years on social development-related activities such as education, healthcare and sanitation. In 2010, a similar mandate was issued by the DPE for government-owned companies, which was also drafted by Chatterjee.
Now, eager to switch over to the execution side of CSR, after seven years tracing from 2009 as part of the policymaking, Chatterjee said the big change he has noted among firms—government and private alike—“is the recognition of the benefits of CSR and the need for impact in CSR”.
Although firms were initially apprehensive about the law, Chatterjee said, the rules have helped streamline their scattered efforts.
As he moves on from his active role in IICA, Chatterjee suggests that two years from the introduction of the rules, firms should now consider real-time monitoring and social impact assessment of their projects.
“Companies shouldn’t conduct surveys or assessments post-mortem. They need to be constantly overseeing the developments so that any required course correction, addition or substraction can be addressed immediately,” said Chatterjee. This would help create a better impact via CSR and also increase the soft benefits that firms receive, such as brand-building.
“The purpose of the law is not to put money into government coffers but instead complement and supplement government efforts. The CSR initiatives of firms can be dove-tailed with government efforts because government priorities are also national priorities and need to be addressed to improve the overall socio-economic conditions,” he added.
A great believer in the role of the not-for-profit sector in implementing CSR initiatives, Chatterjee said, “They remain best implementors because of proximity to the grassroots as well as connection with the community.”
The role of not-for-profit organizations in implementing CSR has been questioned by firms repeatedly, as Mint has reported earlier, but under Chatterjee’s charge, the IICA aimed to address this issue via capacity-building exercises to help make such organizations more efficient and transparent. The institute has also set up an IICA Implementing Agency Hub that lists around 300 organizations currently verified by it as credible CSR partners for companies.
Other initiatives that Chatterjee has taken during his tenure at IICA are set to shape the future of CSR in India.
For instance, for the last two years, IICA has offered a nine-month certificate course in CSR management “to bring professionalism into the sector”, said Chatterjee. Two batches of 170 and 130 students each have completed this course.