Union Finance Minister Nirmala Sitharaman has announced that companies will now have to explain where they spent the money allocated for Corporate Social Responsibility (CSR). She added that if that amount is not being spent, it has to be moved to an escrow account.
“Gandhiji’’s trusteeship principle is with which profit-making cannot be devoid of social responsibility. The amendments we are bringing now are only to sharp focus that and make it far more effective... Here is a Companies Act that is undergoing major changes. We are trying to bring in ease of doing business, bringing in a robust framework through which the Companies Act can be implemented.”Nirmala Sitharaman, Finance Minister
The move was criticised by many on Twitter. It is equal to penalising the firm, said many Twitter users.
‘Terrible Idea’
Economist Rupa Subramanya said, “If company doesn’t spend it, government will sequester the money, which is from hard earned profits, in an environment that is not easy to do business in,” she argued.
Journalist Shekhar Gupta said, “One awful decision made by a government will be made worse by its successor...”
“UPA brought in the idiotic compulsory CSR and NDA now uses it to usher in a new inspector Raj,” he wrote.
‘The Soviet Republic of India’
It is “the worst form of Inspector Raj,” said one Twitter user.
Another Twitter user compared it to a Soviet Republic.
Meanwhile, activist Rahul Easwar chose to disagree, calling it a “courageous move by Nirmala Sitharaman”.
‘Gandhi Must Not Be A CSR Model’
One Twitter user said Mahatma Gandhi “cannot be, should not be, must not be a model for any kind of CSR”.
‘Isn’t Paying Tax CSR?’
Other Twitter users questioned the government’s move considering businesses are “paying one of the highest taxes in the world under business unfriendly environment”
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