policy

CORPORATE SOCIAL RESPONSIBILITY (CSR) POLICY

Summary of Policy

 

Policy Name Corporate Social Responsibility(CSR) Policy
Related policies and regulations Section  135  of  Companies  Act,  2013  read  with  Companies(Corporate  Social Responsibility Policy), Rules 2014
Issue date May 2014
Effective date May 2016
Date of last review Original Version
Date of next review May 2017
Owner / Contact DMI Finance Private Limited
Approver Board of Directors of DMI Finance Pvt. Ltd.
Implementer CSR Committee
Annexures I
Appendices Appendix A - Policy Review History.

 

1. BACKGROUND

Ministry  of  Corporate  Affairs(‘MCA’) has issued guidelines  on  Corporate Social  Responsibility under Section 135 of Companies Act, 2013 read with Schedule VII i.e. Companies (Corporate Social Responsibility Policy), Rules 2014 to companies meeting a certain criteria.

While  there  may  be  no  single  universally  accepted  definition  of  CSR,  each  definition  that  currently exists underpins  the  impact  that  businesses  have  on  society  at large  and  the  societal  expectations  of them.  Although  the  roots  of  CSR  lie  in  philanthropic  activities  (such  as  donations,  charity,  relief work,  etc.)  of  corporations,  globally,  the  concept  of  CSR  hasevolved  and  now  encompasses  all related concepts such as triple bottom line, corporate citizenship, philanthropy, strategic philanthropy, shared value, corporate sustainability and business responsibility.

The Companies Act, 2013 has introduced the idea of CSR to the forefront and through its disclose - or - explain  mandate,  is  promoting  greater  transparency  and  disclosure.  Schedule  VII  of  the  Act,  which lists  out  the  CSR  activities,  suggests  communities  to  be  the  focal  point.  On  the  other  hand,  by discussing a company’s relationship to its stakeholders and integrating CSR into its core operations, the rules suggest that CSR needs to go beyond communities and beyond the concept of philanthropy.

2. APPLICABILITY

In  India,  the  concept  of  CSR  is  governed  by  Section 135  of  the  Companies  Act,  2013,  which  was passed by both Houses of the Parliament, and had received the assent of the President of India on 29 August 2013 and became applicable w.e.f April 01, 2014.

The CSR provisions within the Act is applicable to companies:

a. having net worth of rupees five hundred crore or more, or

b. turnover of rupees one thousand crore or more or

c. a net profit of rupees five crore or more during any financial year

DMI Finance Pvt. Ltd. (“DMI/the company”) falling within the ambit of the above mentioned clauses needs to comply with the said section and rules related to CSR.

3. ROLE OF BOARD OF DIRECTORS

The  Board  of  Directors  of DMI will after  taking  into  account  the  recommendations  made  by  the Corporate  Social  Responsibility  Committee,  approve  the  Corporate  Social  Responsibility  Policy  for the company and disclose contents of such Policy in its report, if any, in such manner as prescribed in Annexure - I; and also place it on the company's  website in a manner prescribed; and ensure that the activities as are included in CSR Policy of the company are undertaken by the company.

The Board of Directors are required to disclose the reasons if the amount allocated for CSR activities are not spent during a financial year in the Board’s Report.

4. FORMATION OF CSR COMMITTEE

DMI shall constitute a Corporate Social Responsibility (CSR) Committee of the Board as per details mentioned below:

Name of CommitteeName of CommitteeComposition of CSR CommitteePeriodicity of Meetings
Corporate Social Responsibility (CSR) Committee

A. Formulate  and  recommend  to  the  Board,  a  Corporate    Social    Responsibility    Policy  which   shall   indicate   the   activities   to   be undertaken  by  the  company  as  specified  in  Schedule VII of Companies Act, 2013

B. Recommend  the  amount  of  expenditure  to be  incurred  on  the  activities  referred  to  in  clause (a);

C. Monitor the Corporate Social Responsibility Policy of the company from time to time.

Minimum  3  Directors  of  the  company  including  1  director  from  the Investors (as per Investment Agreement) Half yearly

 

5. CSR ACTIVITIES

Activities to be undertaken by the CSR committee as per Schedule VII of Companies Act, 2013 are:

a. Eradicating   hunger,   poverty   and   malnutrition,   promoting   preventive health care and sanitation and making available safe drinking water.

b. Promoting education, including special education and employment enhancing vocation skills especially   among   children,   women,   elderly   and   the   differently   abled   and   livelihood enhancement projects.

c. Promoting  gender  equality,  empowering  women,  setting  up  homes  and  hostels  for  women and  orphans,  setting  up  old  age  homes,  day  care  center  and  such  other  facilities  for  senior  citizens and measures for reducing inequalities faced by socially and economically backward  groups.

d. Ensuring  environmental  sustainability, ecological  balance,  protection  of  flora  and  fauna, animal  welfare,  agro  forestry,  conservation  of  natural  resources  and  maintaining  quality  of soil, air and water.

e. Protection of national heritage, art and culture including restoration of buildings and sites of historical   importance   and   works   of   art;   setting   up   public   libraries;   promotion   and development of traditional arts and handicrafts.

f. Measures for the benefit of armed forces veterans, war widows and their dependents.

g. Training  to  promote  rural  sports, nationally  recognized  sports, Paralympic sports  and  Olympic sports.

h. Contribution to the Prime Minister’s National Relief Fund or any other fund set up by the central government for socio - economic development and relief and welfare of the scheduled  castes,  the scheduled tribes, other backward classes, minorities and women

i. Rural development projects.

I. The  Board  of  Directors  of  DMI  may  take  up  the  above  mentioned  activities  through  the following manner:

1. Registered Trust or;

2. Registered Society or;

3. Company established either by subsidiary under Section 8 of Companies Act, 2013

II. The  above  said activities  shall be  implemented  directly by the  management of the  company  with an oversight by the CSR committee

III. CSR  committee  shall  review  the  status  of  the  CSR  activities every half  year and  report  the  same to the Board for their review.

6. CSR  EXPENDITURE

The Board shall ensure that the company spends, in every financial year, at least two per cent of the “Average Net Profits” of the company made during the three immediately  preceding financial years, in pursuance of its Corporate Social Responsibility Policy:

The  company  shall  give  preference  to  the  local  area  and  areas  around  it  where  it  operates,  for spending the amount earmarked for Corporate Social Responsibility activities

a. CSR expenditure to be undertaken in India only

b. Activities that benefit only the employees of the company and their families shall not be considered CSR activities

c. Expenditure related to CSR capacity building of own personnel and implementing not to exceed 5% of the total CSR expenditure

7. CSR REPORTING

The Board’s Report of DMI pertaining to a financial year shall include an annual report on the CSR activities undertaken in the particulars as mentioned in Annexure - I;

8. DISPLAY OF CSR ACTIVITIES ON WEBSITE

The company will display the on its website:

a. CSR activities being carried out by the company
b. Composition of CSR committee
c. CSR Policy

Format for the Annual Report on CSR Activities to be included in Board’s Report:

1. A  brief  outline of the company’s CSR policy, including overview of projects or programs proposed to be undertaken and a reference to the web-link to the CSR policy and projects and programs

2. The composition of CSR Committee

3. Average net profit of the company for last 3 financial years.

4. Prescribed CSR expenditure(2% of the amount as in item 3 above)

5. Details of CSR spent during the financial year:

a. Total amount to be spent for the financial year

b. Amount unspent, if any;

c. Manner in which the amount spent during the financial year is detailed below:

(1)(2)(3)(4)(5)(6)(7)(8)
S.no.CSR project or activity definedSector in  which  the project is coveredProjects or programs

1)Local area or other

2)Specify the state and district where projects or programs were undertaken
Amount outlay(budget) project or program wiseAmount spent on the projects or programs Sub - heads:

(1)Direct expenditure on projects or programs.

(2)Overheads:
Cumulative expenditure upto the reporting the period.Amount spent: Direct or through implementing agency:

6. In case the company has failed to spend the two percent of the average net profit of the last 3 financial years or any part thereof, the company shall provide the reasons for not spending the amount in its Board Report

7. A responsibility statement of the CSR committee that the implementation and monitoring of CSR policy, is in compliance with CSR objectives and Policy of the company.

Sd/-
 
(CEO or MD or Director)
Sd/-
 
(Chairman of CSR committee)
Sd/-
 
(Person specified under clause  (d)  of  section  380(1) of the Act)(wherever applicable)