A small review of Corporate Social Responsibility:

 

Section 135 of the Companies Act 2013 mandates certain categories of companies need mandatory to contribute towards Corporate Social Responsibility:

Definition  of Corporate Social Responsibilities:

As per the Act, 'Corporate Social Responsibility' means and includes but is not limited to:

·       Projects or programs relating to activities specified in Schedule VII to The Act.

·       Projects or programs relating to those activities which are undertaken by the Board of Directors of a company in ensuring the recommendation of the CSR Committee of the Board as per declared CSR Policy along with the conditions that such policy will cover subjects specified in Schedule VII of the Act.

Applicability of CSR:

The provisions of CSR applies to every company fulfiing any of the following conditions in the preceding financial year:

·       Net worth of more than Rs.500 crore

·       Turnover of more than Rs.1000 crore

·       Net profit of more than Rs.5 crore

The Board of Directors of every company for which the CSR provisions apply must ensure that the company spends in every financial year at least 2% of its average net profits made during the immediately preceding three financial years as per its CSR policy. If the company has not completed three financial years since its incorporation, it must spend 2% of its average net profits made during the immediately preceding financial years as per its CSR policy.

 

**More to come—Please follow and comment on this blog to get a complete guideline of CSR**