MCA to Use AI Data Analytics to Monitor CSR Activities

New Delhi: Corporate Social Responsibility (CSR) activities of India Inc will now be closed watched by the Ministry of Corporate Affairs (MCA), as it is planning to use data analytics and artificial intelligence for any discrepancies through its new disclosure form – CSR 2, according to people in the know.

If data analytics suggests irregularities or misuse of CSR rules, companies can be show caused and even penalized, they said.

The new disclosure form seeks granular details of CSR activities, which would help authorities to carry out a wider investigation covering aspects that hitherto went unnoticed, an official said.

Last week, MCA mandated companies to give comprehensive details of their CSR activities of FY21, along with broader details of two preceding fiscal years (FY20, FY19) in the newly CSR -2 form by end of March 2022. For the current financial year –FY22, disclosures need to be made by September 2022.

According to the experts, the new disclosure norms will ensure that the companies comply with CSR rules brought in recently. Disclosing those separately will bring greater transparency and enhance governance, they say.

“CSR form 2 will ensure greater transparency in allocation and utilization of funds by corporates in such activities and at the same time discourage them to tinker with rules under the garb of the CSR activities,” said Anshul Jain, partner, PwC. S-ET

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