- ThinkCap Advisors Team
How To Write a Good CSR Policy
Updated: Apr 24
Clients frequently ask us how to write a CSR policy document, which is one of our CSR advisory services. The simplest way to get started is to Google templates. Is that, however, the best approach? Organizations have different perspectives on their vision and societal contributions. As a result, similar CSR policies are not possible. A company should consider its vision, values, and the impact it wants its CSR programme to have on the community when creating a CSR policy. This will ensure that the CSR policy developed captures the true essence of the enterprise’s CSR objectives and is unique in every way.
CSR Policy – The meaning
As per Companies Act 2013, “CSR Policy” means a statement containing the approach and direction given by the Board of a Company, taking into account the recommendations of its CSR Committee, and includes guiding principles for selection, implementation and monitoring of activities as well as formulation of the annual action plan
CSR Policy – Inclusions
After working with several clients on multiple CSR consulting services projects and creating/reviewing multiple CSR policies, we have outlined key elements below that should form a part of your CSR policy.
Vision –This section should highlight the vision of the company – why does the company want to undertake CSR, intended contribution to the society and how it wants to be viewed/perceived by the relevant stakeholders, in terms of its philanthropic actions
Focus Areas – In this segment, the company should mention the thematic areas (out of Schedule VII) based on which its CSR programmes/activities will be conducted.
The CSR Governing Structure – Detail how the CSR programmes will be governed. Clearly highlight the role of the Board of Directors, CSR Committee and implementation team supporting the Committee
Implementation Mechanism – Mention how the CSR initiatives will be executed:
How will the projects be selected
Whether the company intends to invest in ‘on-going projects’ or 1-year projects
Whether the company will execute the projects on its own, collaborate with implementing agencies (to derive benefit of their expertise) or implement projects through in-house foundation
Selection parameters of partners
Monitoring & Reporting – This section covers aspects relating to CSR reporting and monitoring and evaluation framework that will be adopted by the company to track expected outcomes. Evaluation framework should also cover impact assessment details, specifically for projects where the assessment is mandatory as per regulations.
Apart from the above elements, the policy may also include: aspects relating to employee engagement, treatment of unspent budget, preferred geographical areas etc.
To develop a CSR policy, you may find it useful to observe what other companies in your industry are doing. There is no harm in drawing some inspiration and picking up some best practices from your peers. You can also consider societal issues that impact communities in your sector when choosing thematic areas.
In conclusion, a CSR policy is only the beginning of defining CSR initiatives. It is the actual strategy and well-planned and monitored execution that ensures effective implementation of CSR programmes on ground, and achievement of desired social outcomes.