As part of efforts to quickly channelise funds for the development of the health infrastructure required to fight the Covid pandemic, the government has allowed investments in such activities to qualify as eligible corporate social responsibility (CSR) activities.
The Ministry of Corporate Affairs on Wednesday clarified that spending of CSR funds directly or through pooling of resources for ‘creating health infrastructure for COVID care are eligible CSR activities.
Resources for ‘creating health infrastructure for COVID care’, would include ‘establishment of medical oxygen generation and storage plants’ and ‘manufacturing and supply of Oxygen concentrators, ventilators, cylinders and other medical equipment for countering COVID-19’.
Any funds moving in these activities by companies would qualify being termed as CSR spending for meeting annual compliance.
All companies, including government entities, with a net worth of Rs 500 crore or more, a turnover of Rs 1,000 crore or more, or net profit of Rs 5 crore or more, are required to spend 2 per cent of their average profits of the previous three years on CSR activities every year.
A ministry of corporate affairs circular said that CSR spending on health infrastructure and other activities can be undertaken directly by a company or in collaboration as shared responsibility with other companies.