PSUs that do well may be told to park 5% profits for doing goodhttps://indianexpress.com/article/news-archive/web/psus-that-do-well-may-be-told-to-park-5-profits-for-doing-good/

PSUs that do well may be told to park 5% profits for doing good

The government is considering asking public-sector undertakings (PSUs) to set aside a portion of profits each year towards meeting their “corporate social responsibility (CSR).”

The government is considering asking public-sector undertakings (PSUs) to set aside a portion of profits each year towards meeting their “corporate social responsibility (CSR).” If the amount is not spent,it will be carried over to the next financial year.

The proposal,floated by the Department of Public Enterprises,suggests that public sector undertakings (PSUs) must spend between 0.5% and 5% of their net profits towards CSR.

Based on their 2007-08 results,PSUs would have to spend at least Rs 1,500 crore. Of the 244 PSUs,160 earned a net profit of Rs 91,083 crore in 2007-08,2 per cent of which amounts to Rs 1,821 crore.

According to the proposal,PSUs with profits of Rs 500 crore and above will spend up to 2%,those with profits between Rs 100 crore and Rs 500 crore will shell out 2-3% of their profits while those with profits of less than Rs 100 crore will spend as much as 5% of their profits for CSR,sources told The Indian Express.

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The DPE has discussed the proposal in the Committee of Secretaries. Most Ministries have agreed. Once the CoS clears it,the proposal will be sent to the Cabinet for approval.

The DPE has said that the CSR activities of PSUs should be related to the United Nations Global Compact Programme and “thrust be given to areas related to the business of the PSU.”