CSR FAQs
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CSR FAQs
Corporate Social Responsibility (CSR) refers to a company’s commitment to operate ethically and contribute to economic development while improving the quality of life of employees, local communities, and society at large.
Companies with a net worth of ₹500 crore or more, turnover of ₹1,000 crore or more, or net profit of ₹5 crore or more in the preceding financial year must comply with CSR provisions.
CSR activities must fall under the categories specified in Schedule VII of the Companies Act, such as education, healthcare, environment, rural development, poverty alleviation, and disaster relief.
Activities listed under Schedule VII of the Companies Act, 2013 are considered valid CSR activities. These include education, healthcare, poverty eradication, environmental sustainability, rural development, and more.
According to Section 135 of the Companies Act, 2013, companies that meet any of the following criteria during the preceding financial year must comply with CSR rules:
Net worth of ₹500 crore or more, or
Annual turnover of ₹1,000 crore or more, or
Net profit of ₹5 crore or more.
Activities under Schedule VII of the Companies Act, 2013, such as:
Eradicating hunger, poverty, malnutrition
Promoting education and healthcare
Ensuring environmental sustainability
Empowering women and supporting senior citizens
Promoting sports, culture, and heritage
Disaster relief and rural development
Contribution to government relief funds
Draft a clear CSR policy aligned with Schedule VII.
Choose impactful projects and credible partners.
Maintain transparent monitoring and documentation.
File timely reports and conduct CSR audits.
Companies must disclose reasons for non-spending in their Board Report.
Unspent amounts may need to be transferred to prescribed government funds or unspent CSR accounts.