Abstract

In the present paper, the effectiveness of India’s CSR framework as stipulated under section 135 of the Companies Act of 2013 is evaluated and analysed to see if it amounts to mandatory philanthropy or a means of strategic business. Starting with an overview of the evolution of the CSR concept in India, the paper goes further to investigate the legal regime through which corporations are required to allocate two percent of their annual average net profits towards certain social actions. In doing this, the comparison between the traditional “mandated charity” approach of obligatory expenditure and lack of engagement and the new “strategic CSR” approach, in which organizations seek to create value while incorporating CSR within the business model will be used. This way, it will be shown that although most organizations consider this legislation as obligatory action, there are cases in which corporations can create strategy-oriented and mutually beneficial CSR initiatives. Finally, by comparing the Indian scenario with other countries’, it will become apparent that India stands out due to its unique approach of mandatory spending but flexible implementation. It concludes that while India’s CSR regime currently leans toward mandatory charity, it has the potential to evolve into a powerful strategic tool if supported by stronger governance and a shift toward impact-oriented practices.

The above analysis indicates that while the CSR system in India is presently tilted towards compulsory philanthropy, it can be transformed into an effective strategy if backed by effective corporate governance and impact-based activities.

Keywords: 

Corporate Social Responsibility (CSR), Companies Act, 2013, Compulsory CSR, Strategic CSR, Corporate governance and Sustainable development.

Introduction

The passage of Section 135[1] was highly controversial between legal experts, industrialists, and policymakers. Those in favour described it as the landmark move towards social accountability in corporate governance while critics considered it a move that goes too far, an attempt at legislative overreach and mandatory charity making the CSR function nothing more than a check-box activity.[2] Nine years down the line, the key question remains: is CSR policy in India mandatory charity, forcing companies to give away their money for charitable purposes without engaging in them, or have they transformed into strategic tools of creating value for themselves and others?

This essay will explore whether India’s CSR regime is mandatory charity or a strategic business tool. The history of CSR and how it emerged in India before and after colonization will be traced in detail along with Section 135, the Companies (CSR Policy) Rules, 2014, and Schedule VII. Two distinct approaches will be highlighted, the first being compliance-based CSR which involves spending on paper while the other is strategic CSR involving strategic planning and implementation.[3] A short overview of CSR globally will help in better understanding. The paper also highlights key challenges, including weak monitoring, “checkbook charity,” and uneven regional distribution of funds.[4] It posits that even though the legal requirement has been an opportunity for strategic CSR in some companies, many have regarded the requirement as mere compliance. The way forward lies in restructuring the framework to be outcome-oriented and flexible, among others, with better integration with business strategy.

Research Methodology

In undertaking this research project, this study will follow a doctrinal and comparative legal research method in analysing the regulatory framework of Corporate Social Responsibility (CSR). In a doctrinal analysis, one studies primary sources of law which include the provisions of Section 135 of the Companies Act, 2013, the Companies (CSR Policy) Rules, 2014 and Schedule VII of the Act, amongst others. Governmental policy documents related to this topic will also be reviewed to understand the rationale behind the development of this regulation.

The comparative research technique is applied by comparing India’s CSR regulation framework to other regimes of CSR across the globe, notably in nations like the United Kingdom, United States, Germany, and China. In this regard, comparisons are made between voluntary, market-based regimes of CSR, on the one hand, and government-inspired regimes and hybrid regimes, on the other hand.

Literature Review

It can be noted that the current literature on CSR has developed from voluntary and ethics-oriented concepts to more institutionalized frameworks. Much research has been done emphasizing the nature of CSR as voluntary practice driven by ethics. This relates mostly to liberal markets such as the United States and the United Kingdom where corporations are influenced by the market.

In other countries, however, different types of approaches are taken. For example, Europe adopts more institutionalized approaches with CSR embedded into larger frameworks, while the state influence is quite visible in China’s CSR policy.

Another significant body of literature is devoted to mandatory CSR in India and, specifically, the Companies Act, 2013, which introduces a legal requirement for some businesses to conduct CSR activities. According to Maheshwari et al., India’s case is unique in making several enterprises engage in mandatory spending on CSR. There are controversies regarding this concept because critics claim that mandatory CSR leads to ‘forced philanthropy’ with no positive outcome. Such problems as lack of oversight, impact assessment, and the tendency of corporations to concentrate on some sectors have been widely discussed.

On the contrary, the arguments in favour of the law maintain that it has institutionalized the concept of CSR in corporate governance and ensured that the companies engage in social development consistently. Further, the proponents of the law point out that strategically managed CSR initiatives can be more than just a compliance measure but can contribute to creating value for business sustainably in some corporations.

 In conclusion, from the analysis, the Indian model of CSR is a combination of legal obligations and opportunities for strategic management of social responsibilities by organizations.

Meaning and Concept of CSR

Defining Corporate Social Responsibility

As explained by the European Commission, the term “corporate social responsibility” refers to “the responsibility of businesses for their impact on society,” which includes activities conducted by the company outside legal requirements concerning social, environmental, and ethical issues. On the other hand, the World Business Council for Sustainable Development describes CSR in a more concrete way: “the ongoing commitment of businesses to operate responsibly and contribute to economic development by improving the quality of life of employees and their families as well as the local community and society as a whole.”

In the Indian perspective, however, the Companies Act, 2013 does not explicitly define the term; rather, it implicitly defines CSR through the process of CSR. Under Section 135, along with Rule 2(c) of CSR Rules, CSR means the activities which are performed by the company in the process of carrying out its CSR policy, but shall exclude those activities which are carried out in the normal course of the business operations, or those which are carried out exclusively for the benefit of the employees or their families.[5]

Theoretical Foundations

There are three key theoretical perspectives on CSR. The first one, known as the stakeholder theory, was developed by R. Edward Freeman. According to this concept, companies should consider not just the interests of the shareholders but those of all other stakeholders, which include employees, customers, suppliers, the community, and the environment. This perspective differs from another key theoretical concept called the shareholder primacy theory, proposed by Milton Friedman. Specifically, Friedman believed that “the social responsibility of business is to increase its profits.” In his opinion, CSR is “fundamentally subversive” to capitalism. Another theoretical framework is the creating shared value approach, suggested by Michael Porter and Mark Kramer. It attempts to find a middle ground between profitability.[6]

 

Dimensions of CSR

Archie Carroll’s widely used fourfold model involves economic responsibility (the obligation to be profitable), legal responsibility (obligation to follow laws), ethical responsibility (doing the right thing), and philanthropic responsibility (corporate social citizenship). While India’s mandatory section on CSR requires businesses to embrace the philanthropic dimension, other dimensions like ethical and environmental ones remain voluntarily. Such legislative approach has an immense impact on how strategic or philanthropic the initiative is going to be.[7]

Evolution of CSR in India

Pre-Colonial and Colonial Era

It is worth noting that the practice of CSR in India dates back even prior to the advent of company law. Prior to colonial era, the members of trading and mercantile classes performed philanthropic activities by building temples, wells, hospitals, and schoolhouses. Jajmani system was a practice followed during the pre-colonial times that demanded the richer sections of society give back to society in return for what they received from society. During the colonial period, rich entrepreneurs such as Jamsetji Tata, G.D. Birla, and Kasturbhai Lalbhai established institutions for educating people, providing healthcare facilities, and conducting scientific research. Setting up of the Indian Institute of Science by the Tata Group in 1909 is one such activity.[8]

Post-Independence Era (1947–1990)

After the country’s liberation, the Indian government followed a mixed economic model with central planning. According to the Industrial Policy Resolution of 1956, heavy industries were under state control and thus constrained corporate actions. In this era, CSR practices were confined to compliance with labor legislation and occasional philanthropic activities. Companies were persuaded by the government to play an active role in rural development within the Gandhian approach of trusteeship, yet there was no legal obligation. Some exceptions include the establishment of schools by Birla Group and community projects by Mafatlals.[9]

Liberalization Era (1991–2013)

CII popularized the idea of “corporate social responsibility.” Several organizations such as ITC, Infosys, and Wipro implemented advanced CSR strategies incorporated within the organization’s business operations. ITC’s e-Choupal initiative, wherein the farmers were connected to the market through internet kiosks, is an excellent example of strategic CSR in which agricultural productivity was increased and simultaneously the company ensured their supply chain.[10] The Ministry of Corporate Affairs issued guidelines titled “Corporate Social Responsibility Voluntary Guidelines” in 2009, followed by “National Voluntary Guidelines on Social, Environmental and Economic Responsibilities of Business” in 2011.

The Companies Act, 2013: A Paradigm Shift

The move from a voluntary to mandatory CSR was achieved through the enactment of the Companies Act, 2013. The Parliamentary Standing Committee on Finance, reviewing the draft act, noted that the CSR should not be voluntary or comply-or-explain but should be compulsory. The provision of the law took the recommendation on board and introduced Section 135 which became the first mandatory CSR statute in the world.[11] Such legal provision was unique to India since the failure by voluntary guidelines to achieve broad corporate participation led to legal requirement but with room for flexibility in execution.[12]

Legal Framework in India

Section 135: The Core Provision

Section 135 of the Companies Act, 2013 is the cornerstone of India’s CSR regime.

Sub-section (1) initiates the obligation where every business organization meeting either one of the above three criteria must form a CSR Committee of the Board of Directors. This CSR committee needs to consist of at least three directors with at least one of them being an independent director.[13]

Sub-section (3) requires the Board of Directors of the Company to ensure that the company makes CSR expenditure which is at least two percent of their average net profits of the last three financial years.

The sub-section (4) requires that if the company fails to spend that amount of money for social responsibilities, then they must explain why they failed to do so in their annual report.

It is important to note that before the amendment in 2019, if the required amount had not been spent, it was mandatory for the company to disclose the non-compliance. However, in the recent amendment done in 2019, it became necessary for the companies to transfer the unspent amount of money to the designated funds if the unspent amount is related to any unfinished project and the amount exceeds three years from its initiation.[14]

Companies (CSR Policy) Rules, 2014

Rule 2(c) clarifies the term ‘CSR Policy,’ which is an instrument stating the policy of the corporation regarding CSR, including information about the CSR projects to be implemented.

Rule 4 says that the CSR Committee will prepare a CSR policy and present it for approval to the Board, who will then adopt and publish it. The CSR activities of the firm will either be executed by the firm itself or by any trust, society, or Section 8 Company set up by the firm or its subsidiaries/holding firms.[15]

Rule 6 lays down substantial restrictions on CSR activities, and they must not be included in regular business operations, and expenditure incurred solely on these programs for the benefit of workers and their families cannot be termed as CSR expenditure.

Rule 7 mandates a corporation whose average CSR expense are Rs. 10 crore or above in the preceding three fiscal years to conduct impact assessment through an independent organization.[16]

Schedule VII: Permissible CSR Activities

Schedule VII[17] lists the activities eligible for CSR spending:

1. Elimination of hunger, poverty, and malnutrition; provision of health care services, including preventive health care and sanitation
2. Education, including special education, and vocational training for employment
3. Promotion of gender equality and empowerment of women and creation of homes for women and orphans
4. Environmental sustainability and ecological balance, protection of plants and animals
5. Preservation of national heritage, art, and culture
6. Measures for the welfare of ex-servicemen and war widows
7. Training for promoting rural games, nationally recognized games, and paralympic games
8. Contribution to the Prime Minister’s National Relief Fund and any other fund approved by the central government
9. Contributions to technology incubators maintained by educational institutions
10. Rural development projects
11. Development of slum areas

Administrative and Penal Provisions

The CSR regime is regulated by the Ministry of Corporate Affairs via the Registrar of Companies. The non-compliance with Section 135 was earlier restricted to just disclosures. “The Companies (Amendment) Act, 2019 introduced penalties: for failure to spend or transfer unspent amounts, the company is liable to a penalty of the unspent amount or ₹2 crore, whichever is lower, and every officer in default is liable to imprisonment up to three years or a fine between ₹50,000 and ₹5 lakh, or both”. These penalties remain rarely invoked, leading to criticism that enforcement is weak.[18]

CSR as Mandatory Charity

Charity Paradigm Definition

Mandatory charity concept CSR implies several characteristics. Firstly, expenditures are unrelated to operational processes since the law exempts any CSR activities carried out in ordinary business operations. Secondly, the two percent threshold is arbitrary and lacks any relation to either social needs or corporate resources. Thirdly, compliance focuses on costs instead of results; a firm satisfies its CSR responsibility by making donations without considering their consequences. Finally, taxation laws reinforce the notion by prohibiting CSR expenses as legitimate business costs but allowing tax credits according to section 80G.[19]

Indications of Charity-Motivated Compliance

Statistics show that charity-motivated practices prevail. Approximately 60 percent of all CSR expenditures are channelled through corporate foundations and trusts instead of being integrated into the company’s activities.[20] Most of these are one-off donations made to various relief funds, religious organizations, and scholarships and demand little strategic intervention.[21] Corporate actors prefer to pursue “low-hanging fruits” such as health camps and basic education programs.

The Incentive Problem Under Tax Law

Since Section 37(1) does not cover any deductions for CSR expenditure, but Section 80G provides such deductions for charitable contributions, CSR expenditure will be relatively expensive compared to donations to an approved fund. Therefore, the corporation will be more inclined to view CSR expenditure as a regulatory burden.[22]

Unequal Distribution and Absence of Need Assessment

Corporate spending on CSR is usually allocated to developed areas rather than those in need. The concept of “local area preference” resulted in disproportionately high allocations of corporate expenditures to economically better areas, whereas economically weaker regions lack CSR funds.[23]

CSR as Strategic Tool

What Is the Strategic Paradigm?

A strategic paradigm implies that a company will adopt certain measures aimed at creating value to achieve social responsibility through its business operations. There are four features of strategic CSR: alignment with business goals; long time horizon; outcome metrics; and stakeholder engagement. When CSR becomes strategic, corporate social spending ceases being costs and starts bringing competitive advantages.[24]

Evidence of Strategic CSR in India

Even with the mandatory structure, several Indian firms have managed to convert CSR into a strategy. One of the most well-known examples is ITC Limited. The company launched an initiative called e-Choupal, which involves setting up internet kiosks in rural villages, providing farmers with information on prices, weather forecasting, and best practices in agriculture. The farmers benefited through higher prices from their products, and the company enjoyed a sustainable source of high-quality supplies at low procurement costs. The initiative is now operational in more than 40,000 villages.[25]

Companies in the Tata group regularly practice strategic CSR. Training initiatives by Tata Motors to develop skills among the young people in Jamshedpur create opportunities for the company to hire skilled workers while reducing local unemployment levels. The efforts by Tata Chemicals to manage water resources in Mithapur, which is critical in chemical manufacturing, are other good examples of strategic CSR.[26]

Vocational training centers by Maruti Suzuki in Haryana and Gujarat train young people in skills related to automotive repair and manufacturing. The firm benefits by having a ready pool of skilled workers, and employees can be hired from among the graduates, who acquire skills required in employment. The program is funded through CSR but operates as an extension of the company’s human resource strategy.[27]

Hindustan Unilever Limited (HUL) incorporates the concept of CSR into its distribution system through Project Shakti, where rural women become distributors of HUL products by being directly involved in the selling process. Rural women get employment and empowerment, while HUL benefits by accessing the hitherto inaccessible rural marketplaces. Although this project existed even before CSR became obligatory, HUL has managed to extend this project utilizing CSR money.[28]

 Mechanisms for Strategic Transformation

There are several ways in which a corporation may go from charity to strategy regarding CSR. First, there are CSR committees formed at the board level and composed of executives responsible for operations within the company. Second, there are multi-year project approvals, introduced through the 2019 amendments to ensure that companies do not merely make one-year projects. Third, requirement of impact assessments in large CSR spenders ensures that companies focus on output and not input. Fourth, ESG (Environmental, Social, and Governance) investors exert increasing pressure on firms that engage in strategic CSR.[29]

Creating Shared Value as a Framework

The “Creating Shared Value” theory provides an academic foundation for strategic CSR. According to this theory, there is synergy between competitiveness and community well-being. India’s mandatory CSR regime, while imperfect, has created an institutional environment in which CSV can flourish.[30] Companies that treat CSR as a strategic investment achieve superior financial and social returns compared to those that treat it as a charitable tax.[31]

Comparative Analysis

United Kingdom: Enligthened Shareholder Value Model

Under the United Kingdom’s “enlightened shareholder value” model, Section 172 of the Companies Act 2006 states that the directors must act in such a way as to promote the success of the business, taking into account factors such as long-term impacts, interests of employees, interests of suppliers, customers and community, impacts on the environment, reputation, etc. This applies to directors, not companies themselves, and no compulsory amount of CSR expenditure exists. Thus, the company’s approach to CSR is voluntary, however, ESG disclosure is obligatory for large firms within the Companies (Strategic Report) Regulations 2013.[32]

Flexibility and discretion of directors characterize the UK. While big corporations tend to perform CSR extensively, small and medium-sized enterprises demonstrate low participation rates. In comparison with India’s mandatory approach, the United Kingdom retains the voluntary principle, thus making its implementation uncertain.[33]

United States: Shareholder Primacy with Permissible Voluntary CSR

 Shareholder primacy prevails in the United States, although the “benefit corporations” provide some space for corporate social responsibility. The Business Judgment Rule ensures that under the Delaware law directors should exercise their duties to the benefit of the shareholders.[34]

However, despite being voluntary, CSR activities may be seen as strategic and integrated since they are adopted voluntarily.[35]

Germany: Mandatory Due Diligence

In Germany, the Lieferkettengesetz enacted in 2023 compels large corporations to perform human rights and environmental due diligence activities throughout their supply chains. The organizations must adopt risk management mechanisms, carry out annual assessments, implement preventive actions, offer remedies, and report yearly.[36]

The framework integrates CSR into corporate activities and makes it more strategic compared to the financial expenditure-driven approach in India, although it is costly to implement.[37]

China: State-Directed CSR

China practices CSR under the state capitalism framework. Companies are required to perform social responsibility through laws, with CSR reporting being mandatory for state-owned and publicly listed firms.[38] Corporate Social Responsibility in China conforms to government policy goals like poverty alleviation and environmental conservation. Although it bears similarities with India’s top-down strategy, China’s CSR framework is more integrated with state plans and regulations.[39]

 Comparative Insights

India has a distinct position in the world; being the only nation to have a compulsory expenditure requirement, eligibility criteria for activities, and mandatory board level governance. The United Kingdom and United States focus on voluntary approach with transparency and disclosure requirements. In Germany, a compulsory process approach with no expenditure criteria is followed. In China, compulsory CSR in a state-driven model is followed.[40]

The comparison shows a trade-off between a compulsory approach that ensures compliance and predictability but risks limiting CSR to mere compliance, and a voluntary approach which leads to more legitimate participation but leaves much of its potential unexploited. Mandatory with flexibility adopted by India aims at combining the best of both worlds; its success depends on the implementation approach.[41]

Challenges in Implementation

The biggest challenge is poor enforcement and monitoring mechanisms. The Ministry of Corporate Affairs cannot monitor the claims by companies about their CSR expenditures. It is the company’s responsibility to submit annual reports (CSR-2 form). Also, there are no audits by the Registrar of Companies. There have been few cases where penalty clauses enacted by the government in 2019 have been used for inadequate spending rather than filing CSR reports.[42]

“Checkbook Charity” Practice

Many firms satisfy their CSR requirements by making contributions to trust funds, private organizations, and the Prime Minister’s Relief Fund. These are practices that entail minimal participation and accountability. The donation may even be made through company-sponsored trust funds with limited accountability measures. The Indian legal structure has no provisions for verifying if the CSR funds accomplish the stated purpose.[43]

Outcome-Oriented Shortcomings

There are more input-based approaches under the Act compared to outcome-based ones. For example, even if the company spends ₹10 crores on inefficient projects, they will fulfill their duties under Section 135. Rule 7 on impact assessments is only for companies which spend ₹10 crore or more annually on CSR activities. Additionally, implementation of the recommendations from the impact assessments is optional.[44]

Regional and Sectoral Disparities

The focus on CSR activities is still evident in states such as Maharashtra, Gujarat, Tamil Nadu, and Karnataka and sectors including education and healthcare. This was true under
the old regime of ‘local area preference’ too and continues to be so because of ease of administration and familiarity.[45]

Administrative Pressure on Small Businesses

Thresholds encompass small businesses that cannot afford strategic CSR initiatives. The need to establish a CSR committee and CSR policy, besides reporting to stock exchanges, encourages them to outsource or give minimum donations to avoid complexities.[46]

Double Taxation Paradox

Since CSR expenses are not deductible from taxes, there is an anomaly of double taxation. If a business earns ₹100 crore and spends ₹2 crore on CSR activities, the whole amount would be taxed instead of being deducted from taxes like charitable donations.[47]

Way forward

Shift from Input-Based to Outcome-Based Accountability

The most crucial change must be from the present compliance framework of CSR expenditures to outcome-driven reporting. Corporations can disclose their social impact resulting from CSR expenditure. For example, a company must disclose the number of students who have successfully completed their courses, learned something, or secured employment rather than disclosing how much money was invested in the field of education. The Ministry of Corporate Affairs should develop standardized outcome metrics across Schedule VII categories to ensure comparability.[48]

Enhance Monitoring and Enforcement

The Ministry of Corporate Affairs needs to form an independent CSR monitoring cell with powers to audit CSR expenditure and impacts. The audits must be risk-oriented, focusing on organizations with large budgets, previous instances of non-compliance, or allegations of misuse. The penalty structure for any fraudulent CSR reporting should be upgraded, holding directors accountable for knowing violations. The Registrar of Companies must publish annual CSR compliance reports at the company level for public examination.[49]

Eliminate the Tax Disincentive

The Income Tax Act should recognize CSR expenditure as an allowable deduction under the business income provision provided that the organization adheres to Section 135 and Schedule VII requirements. This would correct the dual taxation problem and harmonize tax provisions with legislation. Otherwise, a tax credit might encourage corporate engagement with CSR activities.[50]

Facilitate Multi-Year Projects without Annual Reset

While the 2019 amendment introduced multi-year projects, the practice prefers annual projects. Regulations must permit CSR projects lasting between three to five years without resetting annually. This would encourage long-term investments in capacity-building programs.[51]

Integrate CSR with Core Business Functions

The provision on conducting activities in the “normal course of business” needs to be strictly defined. The scope of CSR must extend to shared value propositions like workforce development, sustainable procurement, and mitigation of environmental risks. The Ministry of Corporate Affairs can provide specific guidelines for aligning CSR with corporate strategy without compromising regulatory goals.[52]

Make Mandatory Impact Assessment of All CSR Expenditures

Rule 7’s limit of ₹10 crore exempts all but a few companies from mandatory impact assessment. Bringing down this limit to ₹1 crore will cover a broader range of organizations. CSR expenditure assessments should be made public, and companies should justify how these results influence their subsequent CSR policies.[53]

Foster Collaboration and Pooled CSR

To overcome limitations arising from size, regulations should enable pooling CSR efforts by allowing several firms to contribute to joint programs through specialized agencies. Barriers in administration can be minimized, and organizations like CII and FICCI can facilitate coordination.[54]

Combine CSR with ESG and BRSR

CSR should be combined with Business Responsibility and Sustainability Reporting (BRSR) for a comprehensive reporting framework. Organizations that demonstrate effective ESG practices can be rewarded with certain regulatory benefits, making CSR more strategic.[55]

Conclusion

This study considered whether Section 135 of the Companies Act, 2013 imposes mandatory charity on Indian companies or provides for strategic value creation. This study finds that there is a degree of duality within India’s model of corporate social responsibility, which combines elements of both mandatory charity and strategic CSR. Within its legal structure, India’s CSR regime has a charitable character to it because of the requirement of spending two percent of average net profits, prescribed activities, exclusion from core business activities, and tax disincentive.[56]

However, this framework has allowed for strategic corporate social responsibility practices in India as well. Establishment of CSR committees, CSR policies, provisions for multiple year projects, and the requirement of impact assessments have led many organizations to align their corporate social responsibility spending with their business strategies. Examples of some Indian companies, such as ITC, Tata Motors, Maruti Suzuki, and Hindustan Unilever, illustrate strategic corporate social responsibility.[57]

This Indian CSR framework is unique on the world stage because it possesses both these features.

The above-mentioned difficulties, deficiencies in monitoring, checkbook philanthropy, absence of results-oriented approach, geographical inequalities, administrative costs, and taxation issues undermine the efficiency of CSR activities, although the suggested amendments may contribute to the development of a more rational CSR policy.[58] Nevertheless, legislation can oblige enterprises to spend money but not to be dedicated. The shift from philanthropy to strategy will become possible only when corporations regard CSR as a business necessity.[59]

Bibliography

Primary Sources

1. Companies Act, 2013 (Act No. 18 of 2013), § 135, Sched. VII.
2. Companies (CSR Policy) Rules, 2014, Gaz. of India, Extraordinary, Pt. II, Sec. 3(i). 
3. Companies (Amendment) Act, 2019 (Act No. 22 of 2019).
4. Income Tax Act, 1961 (Act No. 43 of 1961), §§ 37(1), 80G.

Secondary Sources: Articles & Books

1. Aparna Bhatia & Amandeep Dhawan, Legitimising CSR through the Institutional   Backup – Gauging Compliance of the Indian Corporate Sector in the Mandatory Regime, 65 Int’l J.L. & Mgmt. 614 (2023).
2. Avadh Bihari & P.K. Shajahan, Changing CSR Practices of Corporates – A Study of Institutionalization of Mandated Corporate Social Responsibility in India, 65 Int’l J.L. & Mgmt. 105 (2023).
3. Between Compliance and Commitment: Evaluating India’s ESG Regulatory Framework, 17 Amicus Curiae 1 (SAS Open Journals 2025).
4. Shaila Mehmood, Corporate Social Responsibility and the Companies Act of India: A Socio-Legal Perspective, 8 Int’l J.L. Mgmt. & Hum. 1212 (2025).
5. Atul Ghorpade & Sabuj Kumar Mandal, India’s CSR Spending Hits Record High, But Uneven Distribution and ‘Tick-Box’ Compliance Raise Concerns, India CSR (Oct. 20, 2025),https://indiacsr.in/indias-csr-spending-hits-record-high-but-uneven-distribution-and-tick-box-compliance-raise-concerns/.
6. Meenu Maheshwari et al., Regulatory Framework of Corporate Social Responsibility Across the World, in Corporate Social Responsibility in India: Law, Regulation and Politics 87 (Taylor & Francis 2024).
7. Reenu Dutt, Corporate Philanthropy in India: Legal Standards and Best Practices, 7 Int’l J.L. Mgmt. & Hum. 615 (2024).
8. Ambili Jayachandran et al., Evolution of CSR and ESG Concepts in the Frame of Sustainability: Insights From Thematic Evolution Across Nations, in Handbook of Research on Sustainability and Corporate Social Responsibility 201 (IGI Global 2024).
9. A Strategic Roadmap for Sustainable Corporate Social Responsibility: The Role of Social Audit, Inclusive Growth, and Creating Shared Value, Scite.org (2025), https://scite.org/reports/a-strategic-roadmap-for-sustainable-y8YME85p.
10. Indian Mining Industry: A Balancing Act? Social Accounting and the Path to Sustainable Corporate Social Responsibility, Scite.org (2024), https://scite.org/reports/indian-mining-industry-a-balancing-W8bDMZ9M.

 

 

 

By ~

Medhavi Jain & Shreya Nikhare

Faculty of Law, Jagran Lakecity University, Bhopal, Madhya Pradesh.

---

[1]Companies Act, 2013, § 135 (India).

[2] Aparna Bhatia & Amandeep Dhawan, Legitimising CSR through the Institutional Backup – Gauging Compliance of the Indian Corporate Sector in the Mandatory Regime, 65 Int’l J.L. & Mgmt. 614, 616-18 (2023).

[3] Meenu Maheshwari et al., Regulatory Framework of Corporate Social Responsibility Across the World, in Corporate Social Responsibility in India: Law, Regulation and Politics 87, 90-112 (Taylor & Francis 2024).

[4] Atul Ghorpade & Sabuj Kumar Mandal, India’s CSR Spending Hits Record High, But Uneven Distribution and ‘Tick-Box’ Compliance Raise Concerns, India CSR (Oct. 20, 2025), https://indiacsr.in/indias-csr-spending-hits-record-high-but-uneven-distribution-and-tick-box-compliance-raise-concerns/.

[5] Companies (Corporate Social Responsibility Policy) Rules, 2014, r. 2(c), Gaz. of India, Extraordinary, Pt. II, Sec. 3(i).

[6] See Michael E. Porter & Mark R. Kramer, Creating Shared Value, 89 Harv. Bus. Rev. 62 (2011).

[7] Archie B. Carroll, The Pyramid of Corporate Social Responsibility: Toward the Moral Management of Organizational Stakeholders, 34 Bus. Horiz. 39 (1991).

[8] Shaila Mehmood, Corporate Social Responsibility and the Companies Act of India: A Socio-Legal Perspective, 8 Int’l J.L. Mgmt. & Hum. 1212, 1215-16 (2025).

[9] Id. at 1216-17.

[10] Avadh Bihari & P.K. Shajahan, Changing CSR Practices of Corporates – A Study of Institutionalization of Mandated Corporate Social Responsibility in India, 65 Int’l J.L. & Mgmt. 105, 108-10 (2023).

[11] Bhatia & Dhawan, supra note 2, at 619.

[12] Mehmood, supra note 8, at 1218-19.

[13] Companies Act, 2013, § 135(1) (India).

[14] Companies (Amendment) Act, 2019, § 135(5)-(6) (India).

[15] Companies (CSR Policy) Rules, 2014, rr. 2(c), 4, 5.

[16] Id. rr. 6, 7.

[17] Companies Act, 2013, Sched. VII

[18] Ghorpade & Mandal, supra note 4.

[19] Between Compliance and Commitment: Evaluating India’s ESG Regulatory Framework, 17 Amicus Curiae 1, 8-10 (SAS Open Journals 2025).

[20]  Bhatia & Dhawan, supra note 2, at 625-27.

[21] Ghorpade & Mandal, supra note 4.

[22] Between Compliance and Commitment, supra note 19, at 12.

[23] Ghorpade & Mandal, supra note 4.

[24] Bihari & Shajahan, supra note 10, at 106-07.

[25] Mehmood, supra note 8, at 1222-23.

[26] Id. at 1223-24.

[27] Id. at 1224.

[28] Id. at 1224-25.

[29] Between Compliance and Commitment, supra note 19, at 15-17.

[30] Porter & Kramer, supra note 6.

[31] A Strategic Roadmap for Sustainable Corporate Social Responsibility: The Role of Social Audit, Inclusive Growth, and Creating Shared Value, Scite.org (2025), https://scite.org/reports/a-strategic-roadmap-for-sustainable-y8YME85p.

[32] Maheshwari et al., supra note 3, at 93-96.

[33] Id. at 97-98.

[34] Id. at 99-101.

[35] Jayachandran et al., supra note 3, at 205-07.

[36] Maheshwari et al., supra note 3, at 102-04.

[37] Id. at 105.

[38] Id. at 106-08.

[39] Id. at 109.

[40] Between Compliance and Commitment, supra note 19, at 20-22.

[41] Maheshwari et al., supra note 3, at 110-12.

[42] Ghorpade & Mandal, supra note 4.

[43] Bhatia & Dhawan, supra note 2, at 628-30.

[44] Between Compliance and Commitment, supra note 19, at 13-14.

[45] Ghorpade & Mandal, supra note 4.

[46] Reenu Dutt, Corporate Philanthropy in India: Legal Standards and Best Practices, 7 Int’l J.L. Mgmt. & Hum. 615, 622-23 (2024).

[47] Between Compliance and Commitment, supra note 19, at 12.

[48] Id. at 28-30.

[49] Id. at 31-32.

[50] Id. at 33.

[51] Bihari & Shajahan, supra note 10, at 118-20.

[52] Indian Mining Industry: A Balancing Act? Social Accounting and the Path to Sustainable Corporate Social Responsibility, Scite.org (2024), https://scite.org/reports/indian-mining-industry-a-balancing-W8bDMZ9M.

[53] Between Compliance and Commitment, supra note 19, at 34-35.

[54] Dutt, supra note 47, at 625-26.

[55] Between Compliance and Commitment, supra note 19, at 36-37.

[56] Bhatia & Dhawan, supra note 2, at 631-32.

[57] Mehmood, supra note 8, at 1226-28.

[58] Between Compliance and Commitment, supra note 19, at 38-40.

[59] A Strategic Roadmap for Sustainable Corporate Social Responsibility, supra note 32.