Legal Framework of CSR in 2025 is governed by the Companies Act, 2013, specifically Section 135, which mandates certain companies to allocate at least 2% of their average net profits from the preceding three financial years toward CSR activities.
Legal Framework of CSR (Corporate Social Responsibility) in 2025 and Key Legal Provisions for CSR in India
- Applicability – Companies with:
- Net worth of ₹500 crores or more
- Turnover of ₹1,000 crores or more
- Net profit of ₹5 crores or more
must comply with CSR regulations.
- CSR Committee – Eligible companies must form a CSR Committee with at least three directors, including one independent director.
- CSR Policy & Reporting – Companies must:
- Draft a CSR policy outlining their activities.
- Publish an annual CSR report in their board’s report.
- Permitted CSR Activities – As per Schedule VII of the Act, CSR funds can be used for:
- Education & skill development
- Hunger & poverty eradication
- Gender equality & women empowerment
- Environmental sustainability
- Healthcare initiatives.
- Regulatory Oversight – The Ministry of Corporate Affairs (MCA) monitors CSR compliance, and companies must disclose their CSR spending in their financial statements.
Corporate Social Responsibility (CSR) in India covers various categories under Schedule VII of the Companies Act, 2013. Here are the key types of CSR activities:
Categories of CSR Activities
- Education & Skill Development
- Promoting education, including special education
- Vocational training and employment-enhancing skills
- Healthcare & Sanitation
- Eradicating hunger, poverty, and malnutrition
- Promoting preventive healthcare and sanitation
- Environmental Sustainability
- Conservation of natural resources
- Renewable energy projects and afforestation
- Women Empowerment & Social Welfare
- Gender equality and women empowerment programs
- Setting up homes for orphans and senior citizens
- Rural Development & Infrastructure
- Development of rural areas and infrastructure projects
- Providing safe drinking water and sanitation facilities
- Technology & Innovation
- Supporting research and development in science and technology
- Encouraging innovation and entrepreneurship
- Disaster Relief & Rehabilitation
- Providing aid during natural disasters
- Rehabilitation programs for affected communities
- Sports & Arts Promotion
- Supporting training for sports and athletes
- Promoting art, culture, and heritage conservation
