With corporate philanthropy gradually expanding beyond India’s metro areas and into the country’s developing Tier-2 cities and industrial belts, corporate social responsibility (CSR) funding in India is undergoing a significant geographic change. The seventh edition of Sattva Consulting’s annual State of CSR in India report, “CSR’s Next Act: How the Coming Decade Will Redefine Corporate Impact”, states that over the last three years, CSR inflows to Tier-2 cities have increased by 55% and to industrial hubs by 120%, respectively, indicating a structural reorientation in India Inc.’s social investments.

Nearly 30% of all CSR financing is still allocated to Tier-1 city districts, with an additional 3% going to nearby clusters. However, metros’ once-dominant hold is eroding. Between FY 2022 and FY 2024, the CSR share of cities with a population of one to two million people nearly doubled (from 13.5% to 16.2%), while industrial districts now receive 7.4% of all CSR allocations, up from 4.4% two years earlier. According to the research, the rate of growth in these areas has surpassed the 30% increase in CSR spending nationwide. According to Srikrishna Sridhar Murthy, CEO and co-founder of Sattva Consulting, “Corporate India is clearly looking beyond traditional centres of philanthropy.” “From Vadodara to Madurai, we’re witnessing businesses establishing their operations in smaller cities, manufacturing corridors, and industrial clusters. The idea of Viksit Bharat, a future in which development finance flows to all districts rather than just a select few, is greatly encouraged by this change. It’s a crucial stag

According to the report, there is still a lack of equity in the allocation of CSR financing, notwithstanding its increased geographic diversity. Three-quarters of all district-level CSR financing has been allocated to 193 districts during the last three years, with approximately 90% of that investment going to low-poverty areas. Of the 54 high-poverty districts in India, only three are listed among the top CSR grantees. Due to a steady increase in private-sector involvement, funding in Aspirational Districts has increased threefold over the last ten years, from 1.3% of overall CSR inflows in FY 2015 to 4.5% in FY 2024. Bigger corporations are starting to allocate a larger portion of their CSR budget—roughly 5%—to these developing areas, especially in the BFSI, energy, and mining sectors. With 11% of their CSR budgets going to Aspirational Districts—nearly three times the rate for the private sector—public sector businesses continue to play a crucial role.

“The geography of philanthropy is shifting, and the opportunity ahead demonstrates deepening, not just diversifying, of India’s CSR footprint,” Krishna stated. The most thorough examination of CSR expenditures in India may be found in the State of CSR report, which is released annually. It incorporates analysis of each company’s annual report and pulls from MCA’s annual report of 21,489 companies. The report’s findings include the following: India’s PSUs and large enterprises drive breadth and depth through considerable local investments, while multinational firms ‘punch above their weight’, generating higher effect through focus and scalability. Nearly one-fifth of all CSR funding in FY 2024 went through institutions, including universities, hospitals, and accelerators, and more than 60% of big corporations now run flagship programmes through their own foundations, indicating the growing number of non-NGO partners.

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