Govt should greenlight CSR spending on tech innovation: Sumit Tayal, CEO, Give

Indian Express

4 days ago

Sumit Tayal is the CEO of Give, a digital-first platform that helps Corporate Social Responsibility (CSR) teams at companies and individual donors give to non-profits in India.
Give, via its Give Grants division, connects institutional donors, companies, and foundations with non-profits, while Give.do connects individual small donors with non-profits. Give Discover provides credible information on all stakeholders in the CSR and non-profit ecosystem.
Sumit was earlier the COO of Netscribes, a global data and insights firmPrior to it, he was the director at Helix Investments, an India-focussed private equity fund. Sumit is an engineering graduate from Visvesvaraya National Institute of Technology, Nagpur, and an MBA from IIM Bangalore.
Sumit spoke to indianexpress.com on the challenges companies face in spending their CSR funds on tech innovation, the state of the CSR system in India, and what the government could do to change the situation. Edited excerpts:
Sumit Tayal: There are 27,000 companies that file for CSR in India. There are around 200 companies at the top end of the CSR ecosystem whose spending is around Rs 15,000 crore, which is around 50 per cent of the total CSR spending in India. I estimate that somewhere around 20 per cent of them would be utilising tech platforms to manage, track, and monitor their projects. A lot of work still happens through email and Excel sheets. Another 20 per cent would be using a patchwork of tech systems, using them for finance, procurement, or other functions.
The next 800 companies in the top 1000 use a bare modicum of tech. You might get the impression that 40% of the top 200 use tech in at least some form. But then, what are they using? They are perhaps using some kind of project management software. So, they are using tech platforms for CSR fund allocation or monitoring, and not necessarily for driving innovation.
We at Give have set benchmarks in the ecosystem in many ways, especially to make giving simple and trustworthy. We have built systems and processes to do due diligence on non-profits and only then onboard them on our platform. We also check if the work that was intended is happening on the ground. There are two parts, one for individual donors to donate to causes that they are passionate about, and for corporates to deploy their CSR funds effectively.
For instance, last year, around one lakh online donors donated to around 600 non-profits through our platform. All these donors found us online. Our processes are tech-driven. It is like an online consumer-facing platform, and the entire crowdfunding cycle is fully automated, from how non-profits get onboarded to how campaigns are created, shared, and promoted across social media and online platforms.
Our interactions with non-profits are, however, offline and will continue to be so. There will always be an offline part, as finally, what we are working for is creating an impact on the ground, where we reach out to hundreds of non-profits individually every year to collect data on how the money was used. There are impact reports. A lot of that collection may be digital, but it still has high manual effort because a large majority of non-profits who are operating on the platform are relatively small without tech support.
Sumit Tayal: We started the reports last year, and it is now an annual feature. In 2024, India completed ten years of CSR. It is the only country in the world that has made legally mandated CSR work on this scale. So, it was a milestone year and was completely missing from the popular narrative around CSR.
Last year, we spoke to companies about CSR spending, and this year, the survey team also interacted with non-profits that are the implementers of CSR. The key takeaways of the report are that CSR is the dominant source of money in the Indian giving space, and it will only become more dominant in the years to come as it is tied to corporate profits.
Secondly, more than half of all Indian non-profits now derive more than half of their total annual budgets from CSR. So, this is the largest force shaping the private giving scenario in India.
Thirdly, all Indian CSR is merely one per cent of the Indian government's social spending. Not the government's total budget, but the government's social spending. So, it is too much to expect that CSR alone can make wonders.
Importantly, in the report, we have asked corporates about how they view spending on tech innovation, and we have some interesting insights. We found that CSR is highly regulated and compliance-heavy; therefore, risk appetite is low. Even today, the CSR law holds directors individually responsible for any errors, omissions, non-compliance, and so on. So, CSR leaders must be very cognisant of compliance and cannot take bold calls beyond a point. Tech innovation is risky and hence a low priority.
Corporates don't want to be in a situation where they are sitting on a bunch of tech projects that have not delivered any results. Delivery is key in the CSR system. Because that's how success is viewed. CSRs prefer to fund programmes that have some proof of concept already established. They are willing to scale what works. They are not the venture capitalists or the angel funders.
It is not that CSR leaders do not want to experiment, but the acceptability of risky projects at the board level and their likely negative impact on compliance weighs on their minds.
Sumit Tayal: The top 200 corporates are collectively spending Rs 15,000 crore on CSR. If you look at the number of companies that may be funding tech innovation in some way, it is our guesstimate that 30% of these (around 60 companies with an aggregate spending of Rs 4,500 crore annually) collectively spend around Rs 250 crore on tech innovation.
Companies have focused on funding startup incubators and accelerators at colleges and universities, academic research, and some of them might be funding some early pilot tech innovation work. But in their individual portfolios, it is unlikely that funding for tech innovation will be more than five per cent of their total spend. So, for tech innovation, particularly for tech for social impact, it could be around Rs 250 crore. These are broad estimates.
There is a high acceptance of funding government-approved incubators and accelerators, and the reason for that is that the CSR law explicitly says that funding for these incubators and accelerators is eligible under the CSR law. What it does is it allows the corporates to work with reputed institutes like IIMs or IITs. They also fund academic research being done by credible institutes. So, BITS Pilani or the IITs are all now able to access CSR funding.
The third aspect that gets funded is if the company is already working with a non-profit, they are open to funding tech pilots being done by existing partners. For example, there is Sneha, a non-profit working on maternal and childcare in urban slums in Maharashtra. They invested in a WhatsApp bot-based solution for their field force to connect with their beneficiaries and give them relevant and timely information as required. So, corporates who had funded Sneha in the past are open to funding their tech innovations now, but a new funder would not be keen on such tech-centric projects.
Sumit Tayal: There are no regulatory hurdles; there are only perception hurdles, if any. Nothing in the CSR law says that you cannot fund an early-stage tech pilot.
The government, to the best of my understanding, has absolutely no problem if you fund innovation, which may result in learning, but not a specific output. Nowhere in the CSR law is there any provision that says that if your output is less than expected, that is non-compliance. They want funds to be allocated and spent or utilised in a timely manner.
CSR committees and decision makers understandably don't want to take on high-risk, uncertain bets when there are more time-tested, steady, and predictable projects. They see tech innovation spending as high risk.
Since the government has clarified that funding for incubators and accelerators from CSR funds are welcome, that funds have flown into this sector. Many tech majors today fund these accelerators.
Tech education is a different ball game. Google, Microsoft, Capgemini, Infosys, Wipro, TCS, every large company in India is focused on either AI skilling or STEM education, as part of their CSR spending.
Sumit Tayal: There are a few where CSR has funded the development and/or deployment of tech-first solutions. One of them is WhatsApp-based chatbots. They are increasingly finding their way into education, healthcare, and livelihood interventions. The typical case is where a non-profit needs to be in touch with their communities remotely and needs to provide targeted information.
The second one is platforms like MindSpark by Educational Initiatives, for adaptive learning. Its programmes help children bridge the learning gap. For example, when a child is in grade four, but their learning level is at grade one, how do we help them catch up over time at their own pace? While MindSpark has been deployed in international schools, it is also in government schools and low-income schools with CSR funding.
Alstom, the energy major, has picked up the theme of sustainable mobility. They are very open to funding non-profits and for-profit social enterprises, whoever is innovating in the theme of sustainable mobility. Some corporations fund tech for impact initiatives in their areas of interest and operations, but this is not huge.
Sumit Tayal: The tipping point would come when the government indicates that it is keen that the corporate sector should look at tech innovation or tech for social impact in a positive manner. It could also happen when the board at a large corporate house shows enthusiasm for tech innovation with CSR funds in the same way it is excited about the use of technology in its business operations. Indian companies are amongst the best-placed players when it comes to innovation in their search for new products and markets. The day that appetite is transferred to the CSR sector, and when the fear of failure subsides, we will see a lot of tech for good projects coming up in the social sector, which will impact communities in a positive way.
The Piramal Foundation is a good example. It may not be something specific to tech, but it is relevant here. They spent years running pilots in tribal communities before they were able to fine-tune their model on what works. And today, they do not hesitate to acknowledge that they had failed for years, but got it right finally. That kind of messaging is what gives comfort.
Sumit Tayal: The government needs to clarify that it is keen that CSR funds go to fund tech innovation in the tech for social impact space. Such a signaling would be of the greatest help.