CSR Consulting & Advisory Services

Section 135 of the Companies Act, 2013 specifies certain CSR requirements that need to be mandatorily undertaken by organizations. These new regulatory provisions impose responsibilities such as setting up a Board level CSR committee, planning and approving CSR activities (for the year), as well as ensuring their implementation.

The Companies Act, 2013 attempts to place onus on the Board of Directors towards governance of CSR activities, prescribing specific mandatory requirements to be adhered to:

Applicability of the CSR regulations:
Companies meeting any one or more of the following criteria are required to contribute toward CSR:
01. Net worth of INR 500 crore or more.
02. Turnover of INR 1,000 crore or more.
03. Net profit of INR 5 crore or more.

Board-Level CSR Committee:
01. Comprising 3 or more Directors with at least one Independent Director.
02. Composition to be disclosed in the annual Board of Directors’ report.

Responsibilities on the Board:
01. Approve and disclose the CSR policy in the annual Directors’ report and on the company website.
02. Ensure implementation of CSR activities as per the policy.
03. Directors’ report to specify reasons in case the specified amount is not spent.

Responsibilities of the CSR Committee:
01. Formulate and recommend a CSR policy and amount of CSR expenditure.
02. Regular monitoring of the CSR initiatives.
03. Board to approve CSR policy; disclose its contents in the Board report; make it public on the company website and deploy the funds.

Annual spending on CSR:
01. Every financial year, at least 2% of the average net profits made during the three preceding financial years.
02. Schedule VII of the Act indicates activities that may be included by a company in their CSR policies.

How we can help!
CSR advisory partner – Providing an end-to-end solution
While most companies have an internal team that manages the execution of CSR activities, fraud risk-related vulnerabilities are, however, often overlooked or undiagnosed. Working alongside forensic experts can help reveal inadequacies in the CSR process/ activities on a real-time basis depending on the stage of involvement.

  1. Development of CSR strategy and policy.
  2. Identification of implementation Partner.
  3. Project evaluation and feasibility analysis.
  4. Project implementation.
  5. CSR effectiveness assessment.
  6. Need basis.