Hitachi Solutions India Private Limited

CSR Policy

1. BACKGROUND

As per Section 135 of the Companies Act, 2013 and rules framed thereunder, the provision of Corporate Social Responsibility (CSR) obligations shall be applicable to Hitachi Solutions India Private Limited (the Company / HSIN) in the event of net profits exceeding INR 50 million in the immediately preceding
financial year. Accordingly, it becomes necessary to have a CSR policy in place and the Board of Directors (‘the Board’) of HSIN to supervise the implementation
of the same. CSR at HSIN goes beyond business and extends to the implementation of socially relevant activities for the benefit of society at large.

2. OBJECTIVES

HSIN CSR Policy intends to:

  • Strive for economic development that positively impacts society at large.
  • Ensure that communities connected with and identified by the Company benefit from its CSR initiatives.
  • Embrace responsibility for the Company’s actions and encourage a positive impact through its activities on hunger, poverty, malnutrition, environment, communities, stakeholders and society.

3. FOCUS AREAS

In accordance with the requirements under the Companies Act, 2013, HSIN CSR activities, amongst others, will focus on:

  • HUNGER, POVERTY, MALNUTRITION AND HEALTH: Eradicating extreme hunger, poverty and malnutrition, promoting healthcare including preventive healthcare and sanitation and making available safe drinking water.
  • EDUCATION: Promoting education, including special education and employment-enhancing vocational skills especially among children, women, elderly and the differently abled, and livelihood enhancement projects; monetary contributions to academic institutions for establishing endowment funds, chairs, laboratories, etc., with the objective of assisting students in their studies.
  • GENDER EQUALITY, EMPOWERMENT OF WOMEN & SUPPORT OF THE ECONOMICALLY BACKWARD GROUPS: Promoting gender equality and empowering women; supporting initiatives for women, orphans, senior citizens and other socially and economically backward groups as may be identified from time to time.
  • ENVIRONMENTAL SUSTAINABILITY: Ensuring environmental sustainability, ecological balance, protection of flora and fauna, animal welfare, agro-forestry, conservation of natural resources and maintaining the quality of soil, air and water.
  • NATIONAL HERITAGE, ART AND CULTURE: Protecting national heritage, art and culture including restoration of buildings and sites of historical importance and works of art; setting up public libraries; promoting and developing traditional arts and handicrafts.
  • PROMOTE SPORTS: Training to promote rural sports, nationally recognized sports, Paralympic sports and Olympic sports.
  • GOVERNMENT FUNDS: Contribution to the Prime Minister’s National Relief Fund or any other fund set up by the Central Govt. for socio economic development and relief and welfare of the schedule castes, tribes, other backward classes, minorities and women.
  • RURAL DEVELOPMENT PROJECTS: Contribution to the Rural development Projects and Slum area development projects.
    Note: For the purposes of this item, the term `slum area’ shall mean any area declared as such by the Central Government or any State Government or any other competent authority under any law for the time being in force. CSR may include other activities as laid down in Schedule VII of the Companies Act, 2013 and amended from time to time.

CSR activities will not include the following:

  • Activities undertaken in pursuance of the normal course of business of the company.
  • Any activity undertaken by the company outside India except for training of Indian sports personnel representing any State or Union territory at national level or India at international level;
  • Contribution directly or indirectly to political parties.
  • Activities benefiting employees of the Company.
  • Activities supported by the company on sponsorship basis for deriving marketing benefits for its products or services;
  • Activities carried out for fulfilment of any other statutory obligations under any law in force in India.

4. COMPOSITION OF CSR COMMITTEE OF THE BOARD OF HSIN:

In terms of first proviso to Section 135 (1) of the Companies Act 2013, since HSIN is not required to appoint an Independent Director under sub-section (4) of
section 149, the CSR Committee shall be constituted with two or more Directors.

5. ROLE & RESPONSIBILITIES OF THE CSR COMMITTEE:

The role of the CSR Committee is to institute a transparent monitoring mechanism for implementation of the CSR projects or programs or activities undertaken by
the company. Indicative responsibilities of CSR Committee are:

  • Formulate and recommend to the Board for approval, a CSR policy in accordance with the CSR Policy of the HSIN, which shall indicate the activities to be undertaken by the HSIN as specified in Schedule VII of the Companies Act, 2013, as amended from time to time.
  • Conduct a meeting of the CSR committee at least once in every financial year. The meeting of the CSR Committee can be held at any place as may be convenient to the Committee members or by means of Video Conferencing.
  • The Committee may approve the urgent matters by passing resolutions by Circulation.
  • Recommend the amount of eligible expenditure to be incurred on the activities referred to in the clause above for approval by the Board.
  • Monitoring the implementation from time to time to comply with the requirements as per the Companies Act 2013.
  • Ensure that the CSR activities undertaken by the company are broadly as per the CSR policy.
  • Reporting to the Board from time to time, coinciding with scheduled Board meetings about activities pursued and amount spent.
  • Any other activity as may be mandated by the Board

The Board’s responsibilities towards CSR are as follows:

  • Upon recommendation of the CSR Committee, to approve spending of such amounts as may be deemed expedient on one or more Projects outlined above.
  • Review the CSR activities undertaken by the company are in line with the CSR policy.
  • Ensure implementation of the activities under CSR and to ensure expenditure of requisite amount on CSR activities every year as per Act and Rules made thereunder, as amended from time to time.
  • Provide reasons if the allocated amount is not spent in the respective financial year, and to transfer the unspent amount to a Fund as specified by the Act and Rules made thereunder.
  • Carry forward and set off any excess amount spent in the earlier Financial Year, in the succeeding Financial Years in terms of the provisions of the Act and Rules made thereunder.

6. UNDERTAKING CSR ACTIVITIES

HSIN will undertake its CSR activities as may be approved by the Board through following methods:

  • CSR activities will be undertaken either by the Company itself or through a trust or section 8 Company (under the Companies Act, 2013) to be established by the Company.
  • A Company established under section 8 of the Act, or a registered public trust or a registered society, registered under section 12A and 80G of the Income Tax Act, 1961, and having an established track record of at least three years in undertaking similar activities.
  • Every entity, whether a trust or section 8 Company who intends to undertake any CSR activity, shall register itself with the Central Government by filing the form CSR-1 electronically with the Registrar w.e.f. 01 April 2021.
  • A Company may also collaborate with other Companies for undertaking projects or programs or CSR activities in such a manner that the Board or CSR committee of respective companies are in a position to report separately on such projects or programs in accordance with these rules.
  • In case of ongoing project, the Board of a Company shall monitor the implementation of the project with reference to the approved timelines and year-wise allocation and shall be competent to make modifications, if any, for smooth implementation of the project within the overall permissible time period.
  • The Board of a Company shall satisfy itself that the funds so disbursed have been utilized for the purposes and in the manner as approved by it and the Chief Financial Officer or the person responsible for financial management shall certify to the effect.

7. LOCATION OF CSR EFFORTS

The Board will decide the locations for CSR activities.

8. FUNDING, SELECTION AND MONITORING PROCESS

The Board will evaluate proposals received under the CSR focus areas and projects will be prioritized by assessing their impact. The Board will deliberate on the proposals recommended by CSR Committee for implementation and approve proposals at its discretion. HSIN representatives will collaborate with stakeholders to monitor the status of each project and will report its findings to the CSR Committee / Board periodically.

9. UNSPENT CSR EXPENDITURE

Any CSR expenditure remaining unspent at the end of the Financial Year, shall be treated in the following manner:

A) In case of an ‘ongoing project’:

  • ‘Ongoing Project’ means a multi‐year project undertaken by the Company, where the project period shall not exceed 3 years excluding the Financial Year in which it was commenced.
  • In case of an ongoing project, the Board shall approve expected timeline to complete the project, budget allocation and manner in which project shall be completed.
  • Projects which were initially not approved as multi‐year projects but whose duration has now been extended beyond 1 year, can be treated as an ongoing project by the Board based on a reasonable justification.
  • Any unspent amount related to the ongoing project is to be transferred to a separate Bank Account named ‘Unspent C’R Account’ within 30 days of the end of the Financial Year.

    • Such transferred amount to the ‘Unspent C’R Account’ shall be spent towards the CSR projects within 3 financial years from the date of such transfer.
    • Else, the portion of the unspent amount shall be transferred to a Special Fund specified by Schedule VII of the Act, within 30 days from the date of completion of the aforesaid 3 financial years.

B) In any other case:

  • Transfer the unspent amount to the Fund specified by Schedule VII of the Act within 6 months from the end of the Financial Year.

10. REPORTING

  • The Company’s Annual Report would include the Annual Report on CSR as per the particulars specified under CSR rules.
  • The report shall include a responsibility statement of the CSR Committee that the implementation and monitoring of CSR Policy is in compliance with CSR objectives and Policy of the company.
  • The Annual Report on CSR Activities shall be signed in accordance with the provisions of the Act and Rules made thereunder, as amended from time to time.

11. GENERAL

The CSR Policy referred to above is to be read in conjunction with Companies Act, 2013 and Companies (CSR Policy) Rules, 2014. Any or all provisions of the CSR Policy would be subject to revision / amendment in accordance with the guidelines on the subject as may be issued by the Government from time to time or as decided by the Board of Directors of the Company. The above policy guidelines are subject to review at suitable intervals and subject to revision accordingly.