What is Companies Act 2013?
India is the only country to have made Corporate Social Responsibility for companies with a turnover of over Rs 1,000 crore or having a net worth of Rs 500 crore five hundred crore or a net profit of rupees Rs 5 crore or more.
Such companies are mandated to form a CSR Committee of the Board consisting of three or more directors, out of which at least one director shall be an independent director. The Board has to ensure that the company spends, in every financial year, at least two per cent. of the average net profits of the company made during the three immediately preceding financial years.
With the passing of the law, we at CAF India have been instrumental in implementing the law and helping companies pursue their CSR vision.More details on Ministry of Commerce website
Which causes to choose from for CSR?
The Schedule VII of companies Act lists out thematic areas from which companies can choose from and formulate a CSR strategy around it.
Eradicating hunger, poverty and malnutrition
Promoting education, including special education and employment enhancing vocation skills
Promoting gender equality, empowering women, setting up homes and hostels for women and orphans; setting up old age homes etc.
Ensuring environmental sustainability, ecological balance, protection of flora and fauna, animal welfare, agroforestry, conservation of natural resources etc.
Protection of national heritage, art and culture :- including restoration of buildings and sites of historical importance and works of art; setting up public libraries; promotion and development of traditional art and handicrafts etc.
Measures for the benefit of armed forces: veterans, war widows and their dependents
Training to promote rural sports, nationally recognised sports, paralympic sports and olympic sports
Contribution to the prime minister's national relief fund: or Prime Minister’s Citizen Assistance and Relief in Emergency Situations Fund (PM CARES Fund)] or any other fund set up by the central govt.
Contribution to incubators or research and development projects
Rural development projects
Slum area development
This includes relief, rehabilitation and reconstruction activities
Notification in the wake of COVID 19
Any company engaged in research and development activity of new vaccine, drugs and medical devices in their normal course of business may undertake research and development activity of new vaccine, drugs and medical devices related to COVID-19 for financial years 2020-21, 2021-22 and 2022-23 subject to the conditions that-
- such research and development activities shall be carried out in collaboration with any of the institutes or organisations mentioned in item (ix) of Schedule VII to the Act.
- details of such activity shall be disclosed separately in the Annual Report on CSR included in the Board’s Report”
10 principles of Good Business
UN GCNI has listed 10 principles pertaining to human rights, labour standards, environmental protection and anti-corruption, which every business should follow.Learn More