CAIRR Update September 21,2022

Summary of the Circular issued by SEBI on 19/09/2022

SEBI notifies disclosure norms for Non-Profit Organisations (NPOs) listed on the Social Stock Exchange (SSE)/ that have raised funds through it

I. SEBI prescribes the following disclosures to be made by the NPOs on an Annual Basis (i.e.) within 60 days from end of Financial Year as per Regulation 91 E of SEBI LODR:

(1) Disclosures on General aspects:

1. Name of the organization (legal and popular name)
2. Location of headquarters and location of operations
3. Vision / Mission / Purpose
4. Organizational goals, activities, products and services
5. Outreach of organization (Type and number of direct, indirect and institutional beneficiaries / stakeholders reached)
6. Scale of operations (Including Employee and Volunteer strength)
7. Details of top donors or investors of organisation – List of Top 5 donors or investors (budget wise)
8. Details of top 5 programs in disclosure period – List of Top 5 interventions/programs (budget wise)

(2) Disclosures on Governance aspects:

1. Ownership and legal form
2. Governance Structure (outlines board and management committee structures, mandates, membership, charters, policies and internal controls)
3. Details of governing body including names of the members of the body
4. Executives with key responsibilities
5. Number of meetings by governing body and other committees formed by them along with attendance and the process of performance review
6. Organisation level potential risks and mitigation plan.
7. Reporting of related party transactions.
8. Mechanisms for advice and concerns about ethics, along with conflict of interest and communicating other critical concerns
9. Remuneration Policies
10. Stakeholder grievance, process of grievance redressal and number of grievance received and resolved
11. Compliance management process and statement of compliance from senior decision maker
12. Organisation registration certificate and other licenses and certifications

(3) Disclosures on Financial aspects:

1. Financial Statement (Balance Sheet, Income statement and Cash Statement) and program wise fund utilization for the year
2. Auditors report and auditor details

 II.  SEBI prescribes the following disclosure norms for Annual Impact Report as per Regulation 91E of SEBI’s LODR:

1. All NPOs will have to provide duly audited Annual Impact Report (AIR) to SSE within 90 days from the end of Financial Year

2. The AIR shall capture :

•  the qualitative and quantitative aspects of the social impact generated by the entity
• the impact that is generated by the project
• In case an NPO is only registered without listing any security : significant activities ( including projects covered under a listed security), intervention, programs during the year and the methodology for determination of its significance.
• In case of a Social Impact Fund where the underlying recipients of funds are SEs which have raised funds using SSE: an overall AIR for the fund covering all investee/grantee organizations where the fund is deployed.

• a. Strategic Intent and Planning

  b. Approach

  c. Impact Score Card

• A detailed guidance note in respect of these disclosures is provided in the notification.

3. The AIR shall be audited by Social Auditors and the NPOs shall disclose the report of the Social Auditor along with AIR

 III. Listed NPOs shall submit statement of utilisation of funds to SSE, within 45 days from the end of quarter.

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