Q.State the meaning of Corporate Social Responsibility as per the Companies Act 2013.

Corporate Social Responsibility (CSR) is a company's continuing commitment to contribute to society's welfare and development while doing business — reflecting the impact business has on society and society's expectations of business. Under the Companies Act 2013 (Clause 135), qualifying companies must set up a CSR committee and are encouraged to spend at least 2% of their average net profit of the previous three years on CSR activities specified under Schedule VII of the Act. …

Meaning of Corporate Social Responsibility

• CSR flows from corporate sustainability — the role companies play in meeting the agenda of sustainable development, which balances economic progress, social progress and environmental protection.
• There is no single universally accepted definition, but every definition stresses the impact business has on society and society's expectations of business. Two widely cited views:
  • European Commission: CSR is "the responsibility of enterprises for their impacts on society".
  • World Business Council for Sustainable Development: CSR is "the continuing commitment by business to contribute to economic development while improving the quality of life of the workforce and their families, as well as of the community and society at large".

CSR as recognised under the Companies Act 2013

• In India, CSR is governed by Clause 135 of the Companies Act, 2013. It makes CSR a formal obligation for larger companies — those with an annual turnover of ₹1,000 crore or more, a net worth of ₹500 crore or more, or a net profit of ₹5 crore or more. …