Groups fault CSR projects undertaken by private sector operators
To promote transparency and accountability in Corporate Social Responsibility (CSR) reporting, Oxfam and Actionaid have argued that there should be room for independent validation and auditing of CSR expenditure on projects by professional bodies in Nigeria.
This, according to them, is expected to prevent incidence of tax evasion by companies in the Organised Private Sector (OPS) undertaking such actions and related projects.
Oxfam and Actionaid in a recent conducted survey, which focused on identifying the nexus between CSR practice by firms’ in the OPS and taxation, made available to journalists, maintained that the absence of policy framework on CSR actions could create avenues for tax evasions by corporate organisations.
“We request that the proposed CSR enabling policy should provide for professional bodies independent validation of CSR expenditure on projects and programmes in order to promote accountability and transparency in reporting of CSR actions and prevent incidence of CST related tax evasion.
Furthermore, they suggested that government must formulate a comprehensive and detailed framework in consultation with the private sector for proper accounting of CSR actions, sustainability of CSR and blockage of any tax leakage on accounts of CSR.
Specifically, the Chairman steering Committee of Strengthening Public Finance in Nigeria (STREPFIN), David Nwachukwu in a press briefing held in Lagos at the weekend said: “Many of the players in the OPS have had cause to embark on infrastructure development projects ostensively to fill some gap in their operating environment.
“But a number of them would want to deal with the cost of providing such infrastructure project as part of their CRS in their environment for activities and in doing so, would also like to claim tax relief in such expenditures.”
Speaking on the flaws identified by the report in relation to CSR actions by Nigerian companies, he said the study clearly showed that CSR actions do not necessarily flow solely from community needs but rather based on joint company agreement than community needs.
He stressed the need for corporate firms to allow CRS actions be driven by community need assessment and national development agenda in order to foster cohesion in the pursuit of such development particularly citizens welfare.
“We call for social audit of CRS actions to ensure value for money in the benefitting communities. We call for the incentivisation of CSR actions as a move to further encourage continuity and sustainability of actions.”
The Director of Finance, Actionaid, Oluwole Elegbede pointed out that there is clear linkage between CSR and taxation in terms of social infrastructure development and citizen wellbeing but however noted that projects not driven by community needs could induce poverty and corruption.
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