Unspent CSR funds hit five-year high in FY23

Not all listed companies above a threshold have spent on corporate social responsibility (CSR) in the way they were required to do.

The aggregate unspent amount in 2022-23 (FY23) stood at a five-year high of Rs 1,475 crore.

In FY23 listed companies spent Rs 15,602 crore while the amount to be expended was Rs 15,787 crore, according to the data from corporate tracker primeinfobase.com.

But some overspent.

The final amount spent also includes administrative expenses and impact assessment cost.

The amount required to be spent in each financial year excludes the amount set off, viz excess amount spent in previous financial years.

Companies on the basis of their net profit, net worth, and turnover are required to spend at least 2 per cent of their average net profit during the immediate three preceding financial years on things such as environment, health, skill development, drinking water, and sanitation.

This data covers all companies listed on the National Stock Exchange and those exclusively listed on the BSE with a market capitalisation exceeding Rs 1,000 crore.

These listed companies allocated Rs 99 for every Rs 100 mandated for CSR projects.

This marks the lowest ratio in the past five years.

On average, each company spent Rs 11.29 crore on CSR in FY23, a 4 per cent decrease from FY22 and a 9 per cent decline from FY21.

Listed companies, on aggregate, spent 1.91 per cent of their net profits on CSR, less than the prescribed requirement.

According to the National CSR Portal, under the Ministry of Corporate Affairs, the number of defaulting companies, whose expenditure has been less than the prescribed amount, is 4,855, one-fifth of the total.