CSR Mission Statement
At IndusInd Bank, we believe that ‘Good Ecology is Good Economics’. We will continue to create value for all our stakeholders and emerge as a ‘Best-in-Class’ Bank that is committed to sustainable economic growth. We will ensure that the Bank’s business grows consistently and responsibly, benefitting those we directly serve while also promoting the well-being of our employees, our natural environment and the community at large. IndusInd Bank will support and design sustainable CSR programs, that primarily empower and benefit marginalized and weaker sections of society, high-risk and high-stressed communities.
CSR Philosophy
IndusInd Bank, is committed to running its business in a way that generates sustainable value for its customers, clients, shareholders and employees. The Bank recognizes that since its sphere of activity and influence extends beyond the boundaries of the financial system, it needs to work through various CSR initiatives for uplifting the marginalized/underserved while undertaking projects under Environmental Conservation.
Guiding Principles
We recognize our on-going commitment to engage with our stakeholders to be a crucial and powerful tool for the way we conduct business. We will pursue a process of continuous improvement of our CSR policy and practices and shall be guided by the CSR Act/Rules as notified by the Ministry of Corporate Affairs. Our vision is to be trusted, valued and respected for our financial, environmental and social performance.
- Strong commitment to bring about grassroots level change in our Country
- Engage with disadvantaged / minorities to improve livelihood and make them self - sustainable
- Also support to promote Rural development, Environment, Education, Inclusive Sports and livelihood.
- Specific focus on women & children for transforming lives
- All activities done with utmost compliance and highest levels of governance
- Engage with diverse stakeholders and pool our resources and capabilities for higher impact
- Monitor and measure our impact
- Build a strong Brand through communication
- Engage employees and create a sense of pride in them
- Partner with reputed implementing agencies for smooth execution and focus on design & development for maximum impact
- Projects and Programs will be distinctive and unique to the Bank designed innovatively with end beneficiary in mind
- Work in collaboration with various ecosystem players and consultants to understand & adopt best practices
- The Bank will ensure that its CSR projects are non-discriminatory in nature and do not have any restrictive political or religious affiliations
- The programs/projects will be beyond business as usual
- The programs/projects will be implemented within the country (with an exception if any as permitted by the CSR rules) and; preferably in areas where the Bank has its presence
- Programs/Projects should not be exclusively for the benefit of employees of the company or their family members or those that are conducted /undertaken exclusively in pursuance of the normal course of business
- The programs/projects should exclude activities that are to be supported on sponsorship basis for deriving marketing benefits for its products or services
- The programs/projects should exclude activities carried out for fulfilment of any statutory obligations under any law in force in India.
Applicability
This policy shall apply to all the employees of IndusInd Bank especially the Corporate Social Responsibility Department for governance and compliance. It shall also be applicable to employees in fully owned subsidiaries/associates of the Bank in case of CSR collaboration.
Scope
This policy shall cover all the activities, projects, initiatives, as enumerated in Section 135 of Companies Act 2013 & rules under Amendments thereof and strategies directed by CSR Committee. It shall also be applicable to fully owned subsidiaries/associates of the Bank in case of CSR collaboration.
BFIL, being a 100% subsidiary of the Bank will also have a CSR Policy which is guided by the Bank’s CSR Policy and a documented governance framework for the CSR activities undertaken by BFIL.
There will be strict arms-length maintained in all CSR activities with Hinduja Group.
Focus Areas
The Bank has adopted a long term approach with programs which provide maximum societal impact, aligning with the CSR mission of designing sustainable CSR programs. IBL has categorized its CSR spends into 2 portfolio
- Flagship Program and
- Strategic Projects
This is summarised below in a table format:
| Portfolio Approach | Flagship Program | Strategic Project |
|---|---|---|
| Definition | Long term programs designed to create deep social rural impact | Short term theme based projects designed to solve critical issues in the ecosystem. Urban / Tier II / Tier III cities in focus |
| Implementation Model |
|
|
| Branding | Owned/Co-owned by IBL | Co-branded with industry / NGO partners |
| Impact | 50-60% budget | 40-50% budget |
| Focus Area | Sustainable Holistic Rural Development | Sustainable Environment, Education, Inclusive Sports, Livelihood as focus themes as focus themes |
| Employee Engagement | IBL Employees engagement / volunteering in key causes / campaigns | IBL Employees engagement / volunteering in key causes / campaigns |
Flagship Programme
Holistic Rural Development Program, designed and owned by IBL with a mission to improve the income levels and standard of living aligning with NITI Aayog Aspirational Districts. It would have a long term perspective of 5-10 years, with impact on:
- > Economic Empowerment of communities
- > Improved efficiency in natural resource management
A significant allocation of CSR spends would be towards this as the program scales up and stabilizes.
Strategic Projects
Projects of 3-5 years taken up in broad thematic areas of:
- 1) Environment Sustainability: This will include programs in verticals such as Water Stewardship, Afforestation, Renewable Energy, Climate Adaptation and Waste Management. (Schedule VII – iv)
- 2) Education and Employability: 1) This will include programs in areas of foundation learning and numeracy, Remedial Education, Fellowship, Scholarship Programs, skill and entrepreneur development. (Schedule VII – ii)
- 3) Inclusive Sports: This will include programs in verticals such as Sports for Women, Sports for People with Disabilities, Sports for the Underprivileged. (Schedule VII – vii)
- 4) Livelihood: This will include the activities undertaken through “Bharat Sanjeevani” project. (Schedule VII – ii)
Other Areas: Exception need based projects as per Schedule VII activities of the CSR Law will be supported on a case-by-case basis.
Priority Geographies
IBL’s Business existing & potential presence in the selected states will be considered in order to serve the needs of communities in regions where IBL operates. States with low scores in SDG scores will be prioritized for maximum societal impact.
CSR Budget
The Bank shall ensure that the 2% of average net profits from the immediately 3 preceding years is spent on CSR initiatives undertaken by the Bank.
The overall amount to be committed to CSR will be approved by the Board as recommended by the CSR committee through its Annual Action Plan carrying list of CSR projects or programs approved to be taken.
The following guiding principles to be adhered to in terms of CSR Budget Outlay and Expenditure:
- The administrative overheads shall not exceed five percent (5%) of the total CSR expenditure of the Bank for the financial year
- Any surplus generated from CSR activities shall not form part of the business profit of the Bank and shall be treated as follows: a. Ploughed back into the same project b. Transferred to a designated Unspent CSR Account (UCSRA) and spent in pursuance of CSR policy and Annual Action Plan of the Company c. Transferred to a Fund specified in Schedule VII, within the prescribed timeline as specified in the CSR Rules.
- Any unspent amount shall be reported to the Board in its report specifying the reasons for not spending the amount and shall be dealt with in accordance to Section 135 of the Act and rules under Amendments thereof.
- In case, the Bank spends an amount in excess of requirement of its CSR obligations in a financial year, such excess amount may be set off against the requirement of CSR spending up to immediate succeeding three financial years’ subject to fulfilment of conditions specified under the Companies (CSR Policy) Amendment Rules, 2021 as maybe amended from time to time.
- The Bank may spend its CSR budget for creation or acquisition of a capital asset subject to fulfilment of conditions specified under the Companies (CSR Policy) Amendment Rules, 2021 and any amended to the same.
During any financial year, the Annual Action Plan of the Company may be modified with approval of the board to include any unbudgeted expenditure, either on account of new project(s) or due to increase in the outlay for approved projects.
Governance
The Bank will follow a committee based approach with the following hierarchy:
- Bank’s Board of Directors
- CSR Committee of Bank’s Board of Directors
- CSR Department
A) CSR Department of the Bank will be responsible for administering and executing the CSR policy.
B) CSR Committee of the Board will consist of three or more directors including at least one Independent Director. The Committee will meet at least twice a year.
The following shall be the terms of reference of the CSR Committee of the Board.
- To approve the Bank’s CSR strategy, policy and goals and revision thereof, as may be required and recommend to the Board.
- To approve the CSR Annual Action Plan pursuant to the Act.
- To monitor the Bank’s CSR performance from time to time to ensure compliance with policy and that the Bank meets the mandatory CSR compliance requirements.
- To review regulatory reporting, communication and appropriate disclosures to stakeholders on the Bank’s CSR projects/initiatives
- To ensure that the surplus arising out of the CSR projects or programs or activities do not form part of the business profit of the Bank
- To carry out any other roles and responsibilities as is mandated by the Board from time to time and / or enforced by any statutory authority including any modification or amendment as may be applicable.
The Budget and Annual Action Plan, detailing the CSR budget spend for the year across several projects and any new initiatives taken up by the CSR Department will be presented to the CSR Committee of the Board for approvals.
Based on recommendations of the CSR Committee, the Board will review and approve the CSR Policy, the Annual Action Plan and the overall governing mechanisms for implementation of the same. The Board shall satisfy itself that the CSR funds so disbursed are aligned to the CSR Policy of the Bank and have been utilized for the purposes and in the manner approved by it. The CFO or appropriate authority shall certify the same to the effect.
Implementation
CSR Programs aligned with the policy will be reviewed by the unit based on predefined criteria and approved for implementation as per the Annual Action Plan.
- Implementation will be either a) Through a company established under section 8 of the Act, or b) Registered public trust or a registered society having an established track record of at least 3 years in undertaking similar activities for which the grant is being given.
- The preferred mode of implementation of CSR projects will be through well-established and reputed partners.
- Partners will be selected based on detailed due diligence and as per pre-defined criteria.
- These organizations would need to be registered under section 12A and 80 G of the Income Tax Act, 1961. The above entities shall register with the Central Government by filing the form CSR-1 electronically with the Registrar, with effect from the 1st April 2021.
- The Company may engage International Organizations (as defined in Clause 2(g) of the Companies (Corporate Social Responsibility Policy) Rules 2014) for designing, monitoring, and evaluation of CSR Projects as well as capacity building of their personnel.
Monitoring and Evaluation
- CSR Department will attend to all activities related to CSR.
- Consultants with required competency and experience may also be hired from time to time.
- Projects will be regularly monitored by the CSR Team, which will also be responsible for holding regular reviews with the relevant Implementing Agencies.
- The Bank may use the services of internal teams, employee volunteers, expert agencies, consultancy firms etc. wherever required for carrying out need assessments, base line surveys, guidance on program design and implementation, impact assessment surveys, volunteering activities and so on.
- Site Visits
- CA certified/audited Utilization certificates
Audit
- All CSR projects > = 50 lakhs Outlay will be audited by External Auditor appointed by the Bank. The same will also supported by CA certified Utilisation certificate from the Implementing Partners
- All CSR projects < 50 lakhs to obtain CA certified Utilization Certificates from the implementing partners.
Impact Assessment
The Bank shall undertake impact assessment of its projects through an independent agency, of the CSR projects having outlays of one crore rupees or more, and which have been completed not less than one year before undertaking the impact study including Social Returns On Investment (SROI) The impact assessment reports shall be placed before the Board and shall be reported in the annual report on CSR.
Branding & Communication Strategy
The CSR programs will be branded under ‘Sattvam – Our Country. Our Commitment’. The Brand stands the spirit of goodness in one and all of us, with a strong nation building focus. The Brand will help reach out to both internal and external stakeholders and enhance the Bank’s presence in media. The Bank will have a clear CSR communication strategy for external and internal stakeholders, which is aligned with the Bank’s overall logo and communication strategy.
Internally, with employees, CSR will provide a platform to deepen employee engagement with the bank by participation in CSR programs and several employee engagement opportunities.
Bank will adhere to the FAQ’s released by MCA dated: 25th August 2021 via General Circular No. 14 /2021
“Companies shall not use CSR purely as a marketing or brand building tool for their business, but brand building as a collateral benefit does not vitiate the spirit of CSR”
As per the rule, any activity designed exclusively for the benefit of employees shall be considered as an “activity benefitting employees” and will not qualify as permissible CSR expenditure.
https://www.mca.gov.in/Ministry/pdf/FAQ_CSR.pdf
Review of the CSR Policy
The CSR Policy will be subject to revision/amendment in accordance with the guidelines as may be issued by Ministry of Corporate Affairs and/or as per Bank’s internal guidelines on policy renewal from time to time, on the subject matter.
- The CSR Committee shall review the Policy for making suitable amendments for better implementation of the Policy. It would be subject to revision / amendment by the Board based on the recommendation of the CSR Committee in accordance with the Act and the Rules.
- The Bank reserves its right to alter, modify, add, delete or amend any of the provisions of this Policy.
- These will, however, be reported to or tabled before the CSR Committee of the Board, from time to time, to ensure CSR Committee’s oversight on these issues.
Disclosures
Appropriate disclosures pursuant to the Act and Amendments thereof in the Annual Reports and Bank Website in prescribed formats, will be made by the Bank.
