At present, under the Companies Act, 2013, the Rules on CSR state that every company having a net worth of ?500 crore, or having a turnover of ?1,000 crore, or making a net profit of ?5 crore during a financial year shall ensure that at least 2 per cent of the average net profits made during the three immediately preceding financial years is spent on CSR. The companies are also mandated to set up a committee to oversee CSR activities.
The Finance Standing Committee of Parliament, which is looking into the Companies Bill, 2016, has questioned the government on why some of the earlier recommendations were not accepted, setting off a debate on the issue of mandating CSR.
A senior Corporate Affairs Ministry official said that “the Bill is still being examined by the Parliamentary Committee, so what the final decision will be cannot be said right now. We have not proposed it (making CSR mandatory)......................Read more