A Critical Analysis of the Provisions of Corporate Social Responsibility

The IUP Journal of Corporate Governance, Vol. XVI, No. 3, July 2017, pp. 7-25

Posted: 6 Aug 2018

Date Written: 2017

Abstract

Section 135 of the Companies Act, 2013 mandates that a company having net worth of 500 cr or more, or turnover of 1,000 cr or more or a net profit of 5 cr or more should spend 2% of its average net profit on Corporate Social Responsibility (CSR). This provision legislating social responsibility by companies in India started a debate regarding the logic behind such mandate because the meaning of the word CSR is itself not clear and different scholars and practitioners have defined the word in different ways. The meaning of the word CSR differs from time to time and place to place. Hence, it also becomes difficult to implement such a law as different stakeholders like companies, implementing agencies, beneficiaries, academicians and regulators interpret it in their own way. The present paper provides a critical analysis of the Companies Act, 2013, Companies (CSR) Rules, 2014, Schedule VII of the Companies Act, 2013 and various other notifications issued by the Ministry of Corporate Affairs. The paper also highlights the intent of the Government of India to incorporate provisions mandating CSR by companies in India.

Suggested Citation

Sinha, Shiv Nath, A Critical Analysis of the Provisions of Corporate Social Responsibility (2017). The IUP Journal of Corporate Governance, Vol. XVI, No. 3, July 2017, pp. 7-25. Available at SSRN: https://ssrn.com/abstract=3215136

Shiv Nath Sinha (Contact Author)

Independent

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