CSR@ 2%: A New Model of Corporate Social Responsibility in India
International Journal of Academic Research in Business and Social Sciences, October 2014, Vol. 4, No. 10, ISSN: 2222-6990
10 Pages Posted: 2 Dec 2014
Date Written: December 2, 2014
Corporate Social Responsibility (CSR) earlier applied as corporate philanthropy and has been in practice in India since ages. However, philanthropy in globalised and modern India does not solve the purpose in quantity and quality. Clause 135 of Company Act 2013 created huge hue and cry among the business community in India. As per clause 135 of the Companies Act, 2013, every company with an annual turnover of 1,000 crore INR ($161 million) and more, or a net worth of 500 crore INR ($80 million) and more, or a net profit as low as five crore INR ($800,000) and more have to spend at least 2% of their average net profit over the previous three years on CSR activities. With the introduction of new Company Act 2013, India became the first country in the world to have legislation for compulsory CSR spending. The paper aims at analyzing the motive of making CSR spending mandatory. It also attempts to explain the concept of CSR in the present Indian scenario, the social issues addressed by the Indian corporations, and methodologies adopted by them to address those issues.
Keywords: CSR, Company Act 2013, India, Philanthropy, CSR Disclosure, Mandatory CSR
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