This document outlines the corporate social responsibility (CSR) requirements for companies in India according to the Companies Act. It specifies that companies meeting certain financial thresholds must spend 2% of their average net profits on CSR activities. It describes the responsibilities of the CSR committee and board in formulating a CSR policy, recommending projects, and monitoring implementation. Permissible CSR activities are outlined in Schedule VII and include poverty reduction, health, education, gender equality, environment, rural development, and heritage preservation. The key highlights of the CSR rules include formulating a policy, establishing a committee, recommending an annual plan and projects, and monitoring expenditures and progress.

1. Corporate Social Responsibility
CSR

2. Net profit >= INR 5 croresTurnover >= INR 1000 croresNet worth >= INR 500 crores
1 2 3
OR OR
Spend 2% of average Net Profits
of last 3 years on CSR activities
Every company of certain financial strength
ApplicabilityRequirementExecutionResponsibility
CSR Committee of the Board to be set up which shall:
• Comprise of min. 3 Directors including 1 Independent
Director
• Formulate CSR Policy
• Recommend CSR projects & expenditure to Board
• Monitor and implementation of CSR Policy
Board shall set up CSR sub committee of the Board which shall:
• Recommend CSR Policy and activities for Board approval
• Monitor CSR activities and 2% spend
• Report reasons for Non-compliance
Expenditures
The Indian context
CSR Provisions of the Companies Act
• Expenditure on projects / programs / activities under
Schedule VII, recommended by the CSR Committee and
approved by the Board
• Expenditure on CSR capacity building of own personnel
as well as those of implementing agencies through
institutions with established track record of at least 3
years is allowed as long as it is not more than 5% of
total CSR expenditure per annum

3. Permissible under CSR Act
Not permissible under CSR Act
• Company can execute through the companies own, holding company, subsidiary company , registered
Trust , society , Section 8 Company.
• If the entity is not set up by the company then it must be an established entity (at least 3 years old)
• Must specify project and programs and monitoring system
• Companies may collaborate / pool resources together but companies should be able to report
separately
• Activities exclusively for benefit of employees and their families shall not be considered
• Activities undertaken in pursuance of normal course of business of the company shall not be
considered
• Only CSR activities within India will be taken into consideration
• Contribution directly or indirectly to political parties shall not be considered as CSR spend
• No religious activity
CSR Rules - Key Highlights
i. Formulation of CSR Policy
ii. Formation of CSR Committee
iii. List of Projects for 14-15 to be recommended by CSR Committee for Board approval
iv. CSR Expenditure monitoring mechanism
CSR activities as per New Companies Act

4. CSR requirements - Schedule VII
Themes Areas /Activities Target Population
Poverty Reduction • Eradicating Hunger
• Addressing Malnutrition
 Socially and
Economically backward
groups and populations
Health • Preventive Health Care
• Access to Sanitation
• Access to Safe drinking Water
 Socially and
Economically backward
groups and population
Promoting Education • Includes Special Education
• Employment Enhancing Vocation skills
• Livelihood Enhancement projects
 Children,
 Women,
 Elderly
 Differently Abled
Promoting Gender
equality and
empowerment of
women
• Setting up homes and hostels
• Setting up old age homes
• Setting up day care centers
• Setting up other facilities for senior citizens
• Measures for reducing inequalities faced by
socially and economically backward groups
 Women
 Orphans
 Elderly / Senior Citizens
 Socially and
Economically backward
groups
Ensuring
environmental
sustainability and
ecological balance
• Protection of Flora and Fauna
• Animal Welfare
• Agro forestry
• Conservation of Natural Resources & maintaining
quality of soil, air and water

5. Themes Areas Target Population
Armed Forces • Measures for the benefit of armed veterans,
war widows and their dependents
 War widows &
dependents
 Armed forces veterans
Sports • Training to promote Rural Sports
• Nationally recognized sports
• Paralympics sports
• Olympic sports
 Rural Populations
 Youth
 Differently abled
Rural Development
Project
• Not specified  Rural Population
Protection of Natural
Heritage, art and culture
• Restoration of buildings and sites of historical
importance and works of art
• Setting up public libraries
• Promotion and development of traditional arts
and handicrafts
 Protection of Natural
Heritage, art and
culture
Technology Incubators • Contributions or funds provided to technology
incubators located in academic institutions
 Academic institutions
approved by central
government
Social , Economic,
Welfare and Relief Funds
• Prime Ministers Relief Fund or other funds set
up by the central government for socio
economic development and relief and welfare
 SC, ST, OBC Minorities
and women
CSR requirements - Schedule VII

6. To be done on Priority
1. Form Board CSR sub-Committee
2. CSR Policy- Prepare and approve by Sub committee
3. Upload on website
4. Roll out SOP: including Process Flow, DOA, MIS Format
5. Annual budget and CSR Plan: Prepare and Get approved
6. Initiate Need Assessment study.
7. Review progress and minute.
8. Report as per the Govt. Format.
9. Upload report on website

7. Thanks