A Study of CSR Rules under Companies Act, 2013



Corporate social responsibility has become an increasingly popular and contentious field of study since the 1970s. CSR is the process by which an organization thinks about and evolves its relationships with stakeholders for the common good, and demonstrates its commitment in this regard by adoption of appropriate business processes and strategies. CSR is not charity or mere donations. Governments around the world and international frameworks are increasingly establishing mandates for the private sector to shift from a purely financial bottom-line approach to what is now known as triple bottom line (people, planet and profit).

Introduction of a Corporate Social Responsibility clause has made India the first country to mandate CSR through a statutory provision.  While CSR is not mandatory for Companies, the rules are in line with the ‘Comply or Explain’ principle with penalties applicable only if an explanation is not offered.

“88% of consumers said they were more likely to buy from a company that supports and engages in activities to improve society.” Better Business Journey, UK Small Business Consortium

This paper is focused on Companies Act, 2013 & its provision on mandatory spending and disclosure of Corporate Social Reasonability activities

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