NEW DELHI: Amid differences over the CSR proposal in the Companies Bill, Corporate Affairs Minister Veerappa Moily today said his ministry has worked out a formula which is acceptable to the industry.
“We are also providing a cushion in order to ensure that the compliance of CSR will also form a part and parcel of the responsibilities of the respective companies,” he added.
He said that he was hopeful that the Companies Bill 2011, would come up for consideration and passage in the monsoon session of the Parliament.
“The Parliamentary Standing Committee has submitted its report to the Speaker who is yet to forward it to the ministry and we will work on it as soon as it arrives, but cannot comment as to what all recommendations are contained therein,” he said.
On being asked if the Committee as suggested any changes in the CSR (Corporate Social Responsibility) clause, which mandates large companies to spend 2 per cent of three years’ average net profit on CSR activities, Moily said he was not aware of any such amendments.
“I am not aware of any kind of amendments that are there and until it comes to us I will not be in a position to take a call as to whether the CSR will continue to remain voluntary or not,” he said.
As per the Bill, every company with a networth of Rs 500 crore or more, or turnover of Rs 1,000 crore or more, or net profit of Rs 5 crore and above in a fiscal will have to form a CSR Committee, consisting of three or more directors, of which at least one director should be an independent director.
On being asked about his views on Competition Commission of India (CCI) slapping a Rs 6,307-crore penalty on 11 leading cement firms for price cartelisation, Moily said that if the governance, risk management and compliance norms are followed in totality by industry and corporate bodies, “perhaps they will not get into these contingencies”.
“Ultimately the rule of law will have to be ensured and compliance is very important as non-compliance of the rules and regulations would mean that you are not in the regime of rule of law,” said the minister.
He further said economic slowdown was a temporary phenomenon caused by certain international and domestic developments and the government is aggressively working to restore the growth trajectory back on its rising path.
“I can assure that within next two-three months things will certainly turn around,” he said.