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Corporate Social

MBA Programme
Lecture 9
CSR in India
CSR in India
Common Thematic Area 40%


Livelihood CSR thru,

94% Health own
Care department
28% CSR thru’
or own Partnership
Foundations with other
72% Companies
Source : E&Y Study
Mindful, catalytic
participation of corporate Purpose of
India in development Section 135 &
CSR Rules

Opened new opportunities

for nation building
Section 135 and Its Characteristics

Requires qualifying companies to

spend a prescribed formula-based
amount on CSR

A “comply or explain” law

Companies Act, 2013: Section 135- Focus Area

Set up CSR process

Governance structure

Allocation of CSR budget mandatory for a stipulated

category of profit making companies
CSR Implementation Parameters As per the Act

CSR action: Set measurable

Partner with NGOs
programmatic outcomes

CSR Committee of the

Board: monitor the CSR Review CSR Policy
Section 135 : Eligibility of Companies
Apply to all Companies that have any one of the following
in any financial year
Net worth Net profit
500 crore or more • 5crore or more
($100 million or ($1 million or
more) more)

• 1000crore or more
($200 million or

An average of the previous three financial years’ profit before tax will be
considered for calculating the 2% for CSR
Section 135 : Requirements

Constitute a Corporate Social Responsibility

Committee of the Board

The Board's report should disclose the

composition of the CSR Committee

The Board should report the details about the

CSR policy developed

The Board should report the CSR initiatives

implemented by the company taken on during
a particular financial year
Section 135 : Roles & Responsibilities of the
Appoint the CSR Committee through Board Resolution

Approve the CSR Policy of the Company

Disclose names of CSR Committee members, CSR Policy in the

Annual Report as well as on the website

Ensure CSR spend: Procure Utilization Certificates from Partnering


Ensure CSR Monitoring Mechanism

Section 135 : Roles & Responsibilities of the CSR
Formulate & seek approval from
the Board for the CSR policy

Identify CSR activities for the


Monitoring of the policy and CSR

Schedule VII : Thematic Areas

1. Eradicating hunger, poverty 2. Promotion of

and malnutrition, promoting education, special
health care, sanitation & safe education and
drinking water vocational skills

3. Gender Equality,
Women empowerment , 5.
4. Protection Benefits to
senior citizens and of National
economically backward armed forces
Heritage, art veterans,
groups and culture war widows
Schedule VII : Thematic Areas (contd)

6. Ensuring
environmental 7. Technology 8. Rural sports,
sustainability, ecological incubators Paralympic and
balance, wildlife & within academic Olympic sports
natural resources institutions

9. PM National Relief Fund and any other 10. Rural

funds setup by the Central Govt. for socio Development
economic development & welfare of projects
Section 135 : Implementation of CSR
Operationalizing Implementing
the institutional Agencies
Developing a CSR Development –
mechanism – team (conducting due
Strategy Detailed Project
identification & diligence, if
Report (DPR)
capacity building required

Project approval – Finalizing

Clear identification insertion of the agreement with the Project
of CSR Budget approved projects implementing Implementation
in the policy agency

Documentation, Evaluation Preparation of

Monitoring (at (Concurrent, Final & Project impact reporting format
Board and Sub- preferably Third assessment and placement in
board level) Party) public domain
Section 135 : Activities not admissible as CSR
• Projects that benefits only employees of the
company & their families

• One of events like marathons -------

• Activities which are not taken up in a project mode

• Expenses incurred by companies for any Act

/statute of regulations

• Contribution of any amount directly or indirectly to

political party

• Activities undertaken by the company in pursuance

of its normal course of business
Reporting Template
1. 2. 3. 4. 5. 6. 7. 8.
Sr CSR project/ Sector in Projects/ Amount outlay Amount spent on Cumulative Amount
No. activity which the (budget) the programme / spend up to spent
identified project is project/ project the reporting Direct
covered programme Subheads period or
wise 1.Direct through
Expenditure Implementing
on projects
the state/
district 2.Over heads

* Give details of Implementing Agency

Reporting template
 Signed

 (CEO/Managing Director/Director)

 (Chairman CSR Committee)

 (Person specified under clause (d) of sub-section (1) of section 380 of the Act)
(wherever applicable)