Social Audit

  I have demonstrated earlier,  the ESG rating, by agency like  CRISIL needs, more  good practice of inducting the third party "Social Audit" before publishing the ESG rating, when there is past history of ESG practice violation.   Any poor or exaggerated ESG rating shall alter the share market price. Now a days this is the perception of the investors that strong ESG compliance of company, is  good indicator of safe investment and excellent return. This is also the target of the Government of India to achieve the Sustainable Development Goal ( SDG Goal ). This SDG Goal mandate, mostly is achieved through  the regulatory authority SEBI.  The SEBI has mandatorily implemented the ESG evaluation of various companies. This rating evaluation now is not matured. The rating agency like the  CRISIL so far has been rating the ESG parameter of the various companies.    CRISIL mostly captures ESG compliance through the document disclo...

  . When some complain is there on the ESG Practice,  then continuous third party Social Audit is required from the "Social Auditor". This is mandatory to validate the  ESG practice whether improved or not ? This is good practice.  Rating validation through any public domain  information, mostly the voluntary BRSR document,  is bad practice, when past complain is there. In the ESG Rating, Social Audit, is necessary for accounting the business risks including the  impacts to all stakeholders, global citizens and covering mostly the human resource capital working in the company. This is basically the audit of the dominated HR function. This "Social Audit" needs, trained human resource expert to scan the social issues and welfare aspect on the human resource practices.     Since, ESG Audit, is mostly audit of the "non financial practices". Hence, the "ESG Audit", which is gaining shape compulsorily in the SEBI listed entity, needs honest ef...

Nayara Energy Limited has jetty location  in ocean, where this company unloads crude imported petroleum. Since, the company is using ocean. Hence, it has social responsibility to protect the environment of the ocean including the submerged heritage sites here. These crude petroleum products are transported to Vadinar Refinery, situated near the Ocean.  Most of the CSR Department in India do not do proper home-work in identifying proper CSR Projects, where company should invest CSR Funds. This is the "lack of skill" as well as "lack of business related experience" of the CSR Department. Another problem is that the CSR Team is not aware with the latest law on the SEBI Provision, where the qualification of the Social Auditor is provided. Many unqualified people are silently working in the market which are engaged in conducting the Social Impact Assessment Audit. This is highly objectionable and against the SEBI Provision. Entire Board of Directors and company officers ...

The boy with "Tiger's Heart", only conducts regular "Social Impact Assessment Audit" or meet "CSR Compliance". This is reality. Weak, confused CSR Head, avoids "Social Impact Assessment Audit" as well as the compliance. They wait for the limit to cross. This is poor culture. Such CSR Head, fails to understand the difference between the "National Vision" Vs. the "Individual Vision" and the difference between the "voluntary social audit" and the "compulsory social audit." Regular "Social Impact Assessment Audit" is a good sustainable practice.  Good Companies follow regularly  "Lean Management" with "5S Audit and Social Audit". They demonstrate here, social oriented responsibility. They do not wait for the threshold to cross, as seen in the Indian and small Chinese companies.  The  good practice of regular conduct of Social Audit, is a wisdom, which only comes from the compan...

* Birendra K Jha Practitioner "Social Impact Assessment Audit"; "Social Audit"; "CSR Audit";  Qualified Member of the Institute of Social Auditors of India; Director, HR Lab   The SEBI Board in its meeting held on September 28, 2021 had given specific note to the Ministry of Corporate Affairs (“MCA”), Ministry of Finance (“MoF”) and Ministry of Home Affairs (“MHA”) to change Company Law 2013 and FERA Provision on the accountability check by the Social Auditor. This has been done to ensure clean route in the social projects and the CSR fund utilization. The SEBI ICDR and SEBI AIF Regulations, have  already been amended. This amendment, with immediate effect has changed the SEBI Listed entities to conduct CSR's Social Impact Assessment Audit, as per the new Law.   Now, only Qualified Social Auditor can conduct the Social Impact Assessment Audit. The Ministry of Corporate Affairs is also changing the provision with regard to the Corporate Social Responsib...

* Birendra K Jha Practitioner "Social Impact Assessment Audit"; "Social Audit"; "CSR Audit";  Qualified Member of the Institute of Social Auditors of India; Director, HR Lab The SEBI (LODR) Regulations 2015, Amendment 2023, has moved one step further and defined clearly the "Social Impact Assessment" Audit and the "Social Auditor" and clearly given the Qualification norms of the "Social Auditor". This definition is absent in the Company Law 2013 so far. This law is immediately applicable in all the SEBI listed companies. The CSR compliance for the SEBI listed Companies, shall have to go with the new SEBI Law.  The important part of the SEBI Law change this year is not only the clear definition and direction on the   "Social Impact Assessment" Audit and "Social Auditor", but has also added another wing on the social economy. This is  the creation of the Social Stock Exchange. Now fund scarcity NGOs, who begs...

  * Birendra K Jha Practitioner "Social Impact Assessment Audit"; "Social Audit"; "CSR Audit";  Qualified Member of the Institute of Social Auditors of India; Director, HR Lab During "Social Impact Assessment Audit", most of the time, what  we see, the CSR department has no any  "CSR Need Assessment". At the last hour, just for the sake of utilization of CSR fund call at random XYZ NGOs and use CSR fund in the name of discharging obligation. This is done to save from the penal  punishment for not using the CSR fund "on-time". A stringent penal punishment is there separately against the  CSR officer and Company's MD both, for not using the CSR fund. This is although a poor practice of discharging CSR Obligation.  Sound CSR department is the one, which prepares "CSR Need Assessment". This "Need Assessment" is a very complex procedure, where expertise  is needed in determining the "Need Assessment...