THE LEGAL ASPECTS OF CORPORATE SOCIAL RESPOSIBILITY.pptx
1. THE LEGAL ASPECTS OF CORPORATE
SOCIAL RESPOSIBILITY
SUBMITTED TO- MR. ADITYA MISHRA
SUBMITTED BY- HARSH(Asu2018010100239)
2. INTRODUCTION
• CORPORATION’S INITIATIVE TO ASSESS AND TAKE RESPONSIBILITY
FOR THE COMPANY’S EFFECTS FOR ENVIROMENTAL AND SOCIAL
WELLBEING.
• IT IS A CONCEPT THAT PEOPLE SHOULD BE ACCOUNTABLE FOR THEIR
ACTIONS AND NOT IMPACT THEIR SOCIETY IN A NEGATIVE MANNER.
• EARLIER IT IS VOLUNTARY BUT FROM 2014-2015 IT IS MANDATORY
FOR THE COMPANY TO CONTRIBUTE FOR CSR PURPOSE.
• THERE ARE FOUR KEY ASPECTS OF SOCIAL RESPONSIBILITY:
3. 1-ETHICAL ACTIONS
->ONE OF THE MOST IMPORTANT ELEMENTS OF SOCIAL
RESPONSIBILITY
->MAKE CHOICES BASED ON WHAT IS RIGHT, NOT WHAT JUST LEGAL
2-LEGAL ASPECTS
-> COMPANY ALSO NEEDS TO UNDERSTAND THE RULES OF
REGULATORY BODIES
->ALL BUSINESSES HAVE LEGAL RESPONSIBILITY TO DO SO
4. 3-ECONIMIC INTERESTS
->IT IS SOCIALLY RESPONSIBLE FOR THE COMPANY TO THRIVE AND MEET ITS
REVENUE GOALS.
->ECONIC INTERESTS ARE NOT THE ONLY GUIDEPOSTS AND SHOULD NOT BE
VIEWED IN A VACUUM.
4-PHILANTHROPIC RESPONSIBILITIES
->ACTIONS TAKEN BY COMPANY TO IMPROVE SOCIETY AROUND THEM
->BY HELPING THOSE IN NEED, BUSINESSES MAKE A POSITIVE DIFFERENCE IN
THE LIVES OF PEOPLE IN THEIR COMMUNITIES.
5. DEFINITION OF CSR IN COMPANIES ACT
• SECTION 135 OF COMPANIES ACT, 2013 AND THE COMPANIES
(CORPORATE SOCIAL RESPONSIBILITY POLICY) RULES, 2014 PROVIDES
FOR THE PROVISIONS OF CSR.
6. APPLICABILITY
• EVERY COMPANY WHICH FULFILLS ANY OF THE FOLLOWING LIMITS
DURING THE IMMEDIATELY PRECEDING FINANCIAL YEAR:
1- NET WORTH: 500 Cr or more, or
2- TURNOVER: 1000 Cr or more, or
3- NET PROFIT: 5Cr or more
SHALL FORM A CORPORATE SOCIAL RESPONSIBILITY COMMITTEE
7. CORPORATE SOCIAL RESPONSIBILITY
COMMITTEE CONSIST OF:
• 1- 3 OR MORE DIRECTORS WITH ALTEAST ONE BEING AN
INDEPENDENT DIRECTOR.
• 2- IN CASE OF PRIVATE LIMITED COMPANIES: 2 OR MORE DIRECTORS
• 3- IN CASE OF FOREIGN COMPANY: ATLEST TWO DIRECTORS, OF
WHICH, ONE BEING AN INDIAN RESIDENT AND ON NOMINATED BY
FOREIGN COMPANY
8. RECOMMENDARY ROLE OF CSR
COMMITTEE
• 1- FORMULATE AND RECOMMEND TO THE BOARD, A CSR POLICY INDICATIVE
OF ACTIVITIES TO BE UNDERTAKEN AS PER SCHEDULE VII OF THE COMPANY’S
ACT ,2013
• 2- RECOMMEND EXPENDITURE AMOUNT FOR (1)
• 3- MONITOR CSR POLICY FROM TIME TO TIME
• 4-PREPARE A TRANSPORT MONITORING MECHANISM FOR ENSURING
IMPLEMENTATION OF THE PROJECTS/ PROGRAMMES/ ACTIVITIES PROPOSED
TO BE UNDERTAKEN BY THE COMPANY.
9. BOARD OF DIRECTOR’S ROLE:
• APPROVE POLICY FORMULATED BY CSR COMMITTEE
• DISCLOSURE OF CSR POLICY CONTENT IN BOARD’S REPORT
• TO PLACE CSR POLICY ON COMPANY’S WEBSITE, IF ANY
• MAKE SPENDING ON ACTIVITIES MENTIONED IN CSR POLICY
10. NET PROFIT REQUIRE SPENDING ON CSR
ACTIVITY
• TO ENSURE THAT AT LEAST 2% OF AVG. NET PROFIT 3 IMMEDIATELY
PRECEDING YEARS IS SPENT ON CSR
• FOR FINANCIAL YEAR 2014-15 CALCULATION:AVG NET PROFIT OF FY 2011-
12,2012-13 & 2013-14 NEEDED TO BE CONSIDERED.
11. CSR ACTIVITIES LISTED IN ANNEX VII
INCLUDES
• ACTIVITIES SHALL BE UNDERTAKEN AS PER CSR POLICY EXCLUDING ACTIVITIES
UNDERTAKEN IN PURSUANCE OF ITS NORMAL COURSE.
• BOARD MAY DECIDE TO UNDERTAKE ITS CSR ACTIVITIES APPROVED BY THE CSR
COMMITTEE, THROUGH A REGISTERED TRUST, OR A REGISTERED SOCIETY OR A
COMPANY ESTABLISHED BY THE COMPANY OR ITS HOLDING OR SUBSIDIARY OR
ASSOCIATE COMPANY.
• A COMPANY MAY ALSO COLLABORATE WITH OTHER COMPANIES FOR
UNDERTAKING PROJECTS OR PROGRAMS OR CSR ACTIVITIES.
• CSR PROJECTS OR PROGRAMS UNDERTAKEN IN INDIA SHALL AMOUNT TO CSR
EXPENDITURE.
12. ACTIVITIES DOESN’T INCLUDE IN
CSR:
• ACTIVITIES UNDERTAKEN IN NORMAL COURSE OF BUSINESS
• ACTIVITY UNDERTAKEN OUTSIDE INDIA
• CSR PROJECTS THAT BENEFIT ONLY THE EMPLOYEES OF THE COMPANY AND
THEIR FAMILIES
• CONTRIBUTION OF ANY AMOUNT DIRECTLY OR INDIRECTLY TO ANY POLITICAL
PARTY
• ACTIVITY NOT COVERED WITHIN SCHEDULE VII OF THE 2013 ACT
13. SCHEDULE VII MANDATES
EXPENDITURE FOR THE FOLLOWING
ACTIVITY-
• 1-ERADICATING HUNGER, POVERTY AND MALNUTRITION.
• 2-PROMOTING EDUCATION, INCLUDING SPECIAL EDUCATION AND EMPLOYMENT
ENHANCING VOCATIONAL SKILLS.
• 3-PROMOTING GENDER EQUALITY, EMPOOWERING WOMEN, SETTING UP
HOMES AND HOSTELS FOR WOMEN AN ORPHANS.
• 4-ENSURING ENVIROMENTAL SUSTAINABILITY ECOLOGICAL BALANCE,
PROTECTION OF FLAURA AND FAUNA.
• 5-PROTECTION OF NATIONAL HERITAGE, ART AND CULTURE .
• 6-MEASURES FOR THE BENEFIT OF ARMED FORCES VETERANS, WAR WIDOWS
AND THEIR DEPENDENTS;
14. • 7- TRAINING TO PROMOTE RURAL SPORTS, NATIONALLY RECOGNISED
SPORTS,PARAOLYMPIC AND OLYMPIC SPORTS;
• 8-CONTRIBUTION TO THE PRIME MINISTER’S NATIONAL RELIEF FUND OR ANY
OTHER FUND SET UP BY THE CENTRAL GOVERNMENT;
• 9-TECHNOLOGY INCUBATORS LOCATED WITHIN ACADEMIC INSTITUTION,
• 10-RURAL DEVELOPMENT PROJECTS
• 11-SLUM AREA DEVELOPMENT
16. The World Business Council for Sustainable Development in its
publication Making Good Business Sense by Lord Holme and Richard
Watts mentioned
“ Corporate Social Responsibility is the continuing commitment by
business to behave ethically and contribute to economic development
while improving the quality of the workforce and their families as well
as the local community and society and large”
