Ministry of Corporate Affairs Current Affairs - 2019

Category Wise PDF Compilations available at This Link

President Kovind presents National Corporate Social Responsibility Awards

President Ram Nath Kovind presented the National Corporate Social Responsibility Awards (NCSRA) to selected companies in New Delhi. These awards are highest recognition given by Government of India in domain of CSR and are awarded to companies for their outstanding contribution in area of Corporate Social Responsibility (CSR).

About National Corporate Social Responsibility Awards (NCRSA)

The awards have been instituted in 2017 by Union Ministry of Corporate Affairs (MCA) to recognize corporate initiatives in area of CSR to achieve inclusive growth and sustainable development. The awards were instituted subsequent to the recommendations of High Level Committee on CSR.

In 2019 edition of NCRSA, 19 companies from a total of 528 entries have been selected for the award based on the submissions by the companies and reports of the independent assessment by CSR experts, Jury.

Objectives:

  • Increasing competition in various categories of companies so as to infuse excellence in their CSR activities
  • Encouraging companies to spend entire amount i.e. eligible CSR spend
  • Recognising impact, usage of technology, innovation, gender and environment issues, scalability, replicability and sustainability of CSR activities.
  • Channelising CSR initiatives of corporate so that benefits of these activities reach in remote areas of country and to marginalised sections of society

Categories of Awards:

Total number of awards of NCSRA is 20 in 3 categories are-

1. Corporate Awards for Excellence in CSR:

a) Recongnition to a company based on total eligible CSR Spend (4 awards)-

  • above Rs.100 crores
  • between Rs.10 crores and Rs.99.99 crores
  • between Rs.1 crores and Rs.9.99 crores
  • Spend below Rs.100 crores

b) Honourable Mention: In addition to four main awards, there may be four honourable mentions for companies that have undertaken appreciable CSR activities.

2. Corporate Awards in CSR in Challenging Circumstances:

a) Recognition to a company based on its CSR efforts in challenging circumstances, difficult terrains or disturbed areas, aspirational districts among others (up to five awards)- North; North East; East; West; South.

b) Honourable Mention: In addition to 5 main awards, there may be 5 honourable mentions for companies which have undertaken appreciable CSR activities.

3. Recognition to a company to be given based on contribution to National Priority Schemes (NPS), so as to motivate corporates to spend in these areas. (Up to 11 Awards)

a) Honourable Mention: In addition to 11 main awards, there may be 11 Honorable Mentions of companies which have undertaken appreciable CSR activities.

Government relaxes norms for shares with differential voting rights

Union Ministry of Corporate Affairs (MCA) has amended provisions relating to issue of shares with Differential Voting Rights (DVRs) provisions under Companies Act. This move is aimed at enabling promoters of Indian companies to retain control of their companies in their pursuit for growth and creation of long-term value for shareholders, even as they raise equity capital from global investors.

Key changes made are

The existing cap of 26 % of total post issue paid up equity share capital raised to 74 % of total voting power in respect of shares with DVRs of a company.

The earlier requirement of distributable profits for 3 years for a company to be eligible to issue shares with DVR now has been removed.

Alongside above two changes, time period within which Employee Stock Options (ESOPs) can be issued by Startups recognized by Department for Promotion of Industry & Internal Trade (DPIIT) to promoters or Directors holding more than 10% of equity shares, has been increased from current 5 years to 10 years from date of their incorporation.

Background

Promoters/founders who are instrumental in starting up company often lose control of firm when they dilute their stakes to raise multiple rounds of funding. Differential Voting Rights do not follow common rule of one share-one vote. DVRs enable promoters to retain control over company even after many new investors come in, by allowing shares with superior voting rights or lower or fractional voting rights to public investors.