Institutionalisation of CSR stakeholders: an analysis of the Indian corporate sector in the mandatory regime

Abstract

Purpose

This study aims to analyse the deployment of mandatory corporate social responsibility (CSR) expenditure incurred by Indian corporate sector, under various development heads as specified by CSR statutes in India.

Design/methodology/approach

The thematic distribution of mandatory CSR expenditure is calculated on a large sample of top 500 Bombay Stock Exchange-listed companies in India over a time span of seven years from 2014 to 2015 till 2020–2021. The money spent on each of the specified stakeholders is extracted from the annual reports of the sampled companies to calculate the average expenditure under each of the development heads.

Findings

The findings indicate that the distribution of CSR expenditure by Indian companies into various development heads is unbalanced. Some of the heads such as “Education”, “Healthcare”, “Development Projects”, “Employment” and “Environment” attract more CSR contributions, whereas some other equally important heads such as “Art & Culture”, “Sports”, “Armed Forces” and “Technology Incubators” have comparatively received much less contributions in all the years of assessment. However, during the times of COVID, Indian companies proactively contributed to combat the virus so much so that “COVID-19 Relief” received all-time high contributions among all the development indicators.

Practical implications

The institutionalised back up has replaced the randomness in stakeholders’ approach followed by Indian companies. To ensure the balanced development of the country, the disproportionate contribution into various development heads in all the years of mandatory CSR era calls for further assessment of CSR guidelines issued by the Ministry of Corporate Affairs (MOCA).

Originality/value

This study gives significantly novel insights into the CSR literature by comprehensively analysing the deployment of mandatory CSR funds into various development heads as specified by MOCA in India.

Citation

Bhatia, A. and Dhawan, A. (2024), "Institutionalisation of CSR stakeholders: an analysis of the Indian corporate sector in the mandatory regime", International Journal of Ethics and Systems, Vol. ahead-of-print No. ahead-of-print. https://doi.org/10.1108/IJOES-10-2023-0230