CSR: Will corporates look at CRISIL ratings now?

CSR: Will corporates look at CRISIL ratings now?
Ranjan Kaplish August 12, 2014

One of the leading agencies known for its diverse rating systems has now developed a rating system for non-government organizations (NGOs) and will be grading them on the scale of 1–5, with VO-1A being the highest and VO-5A being the lowest grade.

With the new Companies Act mandating corporate social responsibility (CSR) spends for large corporate groups, the demand for credible NGOs with sound performance records has soared. This new rating system by CRISIL is likely to help businesses in making their first short lists while seeking CSR implementation partners.

CRISIL in a news report claims that NGOs will be evaluated on various parameters including the people driving the NGO, the processes that are in place for attaining its objectives – such as training of field staff or a grievance mechanism for beneficiaries, and impact analysis of flagship programmes which includes site visits. The agency will then conduct financial analysis to determine the ability of the NGO to raise funds and also its utilization.

One of the first NGOs to be rated under the system is HelpAge India, which has been assigned a VO-1A grade, denoting ‘very strong’ delivery capability and high financial proficiency. SOS Children's Village (SOSCV) was given a VO-2A grade, which denotes ‘strong’ delivery capability and high financial proficiency, as per the rating agency.

It is to be noted that there are more than 20 lakh NGOs registered in the country, but there is no consolidated system to track their works or to measure the impact that they could be making. Recently, the Central Bureau of Investigation (CBI) had been entrusted with collating data on NGOs. Failing in its attempt, CBI informed the Supreme Court that the task is difficult given the mind-boggling number of NGOs as many do not file audit reports with the authorities. Hence, such a system by CRISIL may be a welcome move for many organizations.

Yet, it may also be noted that thousands of NGOs are based out of small towns and villages and do meaningful work on shoestring budgets. How CRISIL will reach them in the first place and then evaluate them on financial proficiency is a matter of wait and watch.

Also, if CRISIL has developed a revenue model for itself, then its focus may remain on the large foundations that are funded by corporate groups or foreign charities, and there is a fear of limiting the grading to posh organizations that can afford public relations agencies

Embedding PM Modi vision in CSR, businesses building toilets in the rural

Embedding Modi vision in CSR, businesses building toilets in the rural
CauseBecause Bureau, September 2, 2014

‘I want to start on this one work from today. There should be a toilet in all the schools of our country. A separate toilet for girls... it is only then that our girls will not have to quit schools.’

It was the first-ever extempore speech by an Indian prime minister on Independence Day, the speech being annually delivered at the Red Fort. This year, Prime Minister Narendra Modi acknowledged before international dignitaries that half of our countrymen did not have access to toilets. He did not shy away from elaborating on the evils of open defecation, faced especially by the women.

While he urged the government machinery to step up efforts to build toilets across every household in the country, corporate India too seems to have got the message. Large corporate groups for whom the corporate social responsibility (CSR) spend has been mandated are investing their social spends toward building toilets for rural communities. Here are a few companies that recently announced big-budget toilet-building projects.

Tata Consultancy Services (TCS)

One of the largest software services companies, Tata Consultancy Services (TCS) was the first one to proclaim its commitment towards financing hygienic sanitation facilities for girls. The company has announced that it has pledged Rs 100 crore to build toilets in about 10,000 schools.

‘We firmly believe that achieving the mission of providing hygienic sanitation for girl students will have a tangible impact on the level of education achievement and development of India's next generation,’ TCS CEO and Managing Director N Chandrasekaran said.

Bharti Foundation

Another Rs 100 crore commitment came from Bharti Foundation, the CSR arm of Bharti Enterprises. The Foundation in a media release said that over the next three years it would be constructing toilets for every rural household in Ludhiana District lacking such facilities. In addition to rural household sanitation, the Satya Bharti Abhiyan will also invest in improving sanitation facilities in government schools in rural Ludhiana by building new toilets for girls.

‘It is our commitment that no single household or school in rural Ludhiana will be without a toilet by the end of this tenure,’ said Bharti Foundation Chairman Sunil Bharti Mittal, who happens to hail from Ludhiana. Bharti Foundation Co-Chairman Rakesh Bharti Mittal assured that he would be personally monitoring the progress of the project.

L&T Public Charitable Trust

L&T Public Charitable Trust, the CSR arm of Larsen & Toubro group, has unveiled plans to build 5,000 toilets. Group Executive Chairman AM Naik announced a major CSR initiative that would add traction to the Swachh Bharat Abhiyan programme. The company’s statement read that the investments from L&T Public Charitable Trust would cover water supply and distribution, sanitation facilities, healthcare and skills training.

Vedanta

Vedanta Hindustan Zinc has joined hands with the Rajasthan government to construct toilets for 20,000 households in Rajasthan. Initially, these toilets will be constructed in the three panchayat samities of Bhilwara and Chittorgarh districts. With a CSR fund of about Rs 25 crore, the project will be completed in three years.

Hindustan Zinc has already constructed nearly 1,750 toilets in collaboration with DRDA-Total Sanitation Project.

Sulabh International

NGO Sulabh International recently handed over 108 low-cost toilets to villagers at Katra Sadatganj in Badaun and adopted the hamlet as model village for a nationwide ‘Toilets for Every House’ campaign. The sanitation drive was launched in the wake of alleged gangrape andmurder of two sisters in Katra in May. The NGO said the campaign was in furtherance of women’s right to safe toilets and it plans to make the village free of open defecation in phases with 300 more Sulabh toilets in the pipeline.

It is to be noted that as per a UNICEF report only 48 per cent of rural Indian population has access to toilets and sanitation facilities. About 50 per cent of schools in states like Andhra Pradesh, Telangana, Bihar, Odisha, Madhya Pradesh, Rajasthan and West Bengal do not have toilets. There is a direct link between health and sanitation and human wellbeing. When about 50 per cent of Indian population defecates in the open, it leads to improper disposal of the waste, sanitation issues and dangerous diseases.

Toilet Effort in Government Circles

Defence Research and Development Organisation

Speaking at a function at Defence Research and Development Organisation (DRDO) research centre in Hyderabad, Union Urban Development Minister Venkaiah Naidu put the spotlight on the DRDO-developed bio-toilets (called bio-digesters) that have been set up for the army in certain areas. Naidu noted that the toilets could be replicated for the civilian population as well, saying, ‘The prime minister has already declared that under the Swachh Bharat Abhiyaan, India should become Swachh Bharat by 2019. For that, you need to provide a toilet to each household in rural and urban areas. This bio-toilet is something that is affordable and nature-friendly.’

Human Resources Ministry

Addressing a conference for state education secretaries in New Delhi, Human Resources Minister Smriti Irani directed departments to ‘prepare an action plan for construction of toilets in all government schools so that the goal set by the prime minister for providing all these schools with toilets within one year becomes a reality.’ The minister said that states should meet the target by July 2015.

Ministry for Drinking Water and Sanitation

The Ministry for Drinking Water and Sanitation has prepared a Cabinet note for enhancement of monetary support for building different categories of rural toilets in the country. Under the new proposal, rural households without sanitation will get Rs 15,000 each for constructing toilets, while schools will get Rs 54,000 for the same.

A number of other ministries including the ministry of rural development and the ministry of urban infrastructure are also preparing to contribute their bit in building toilets.

It is not that the problem of open defecation has been noticed just now. In 1986, the then government had started the Central Rural Sanitation Programme (CRSP) primarily with the objective of improving the quality of life of rural people and also to provide privacy and dignity to women. The UPA government started Nirmal Bharat Abhiyan (NBA), previously called Total Sanitation Campaign (TSC). This was a community-led sanitation programme that evolved from the limited achievements of CRSP. The main goal of Nirmal Bharat Abhiyan was to eradicate the practice of open defecation by 2017. However, the programme was not solely focused on building infrastructure; it aimed to change cultural norms to prevent open defecation. In Maharashtra, where the programme started, more than 2,000 gram panchayats have achieved ‘open defecation-free’ status. The campaigning ambassador for Nirmal Bharat Abhiyan was Vidya Balan. The status of the campaign at present is not known, though Team CauseBecause will get in touch with the concerned authorities to figure out the exact impact of the investments.