Abstract

Spending on CSR is not new in India. It has raised a lot of expectations and gained growing recognition as a new and emerging form of governance in India after legislating of CSR mandate in Companies Act, 2013, w.e.f 1st April, 2014. India has become the first country to mandate CSR through a statutory provision. Countries like U.K, U.S.A, China, Germany and Australia have voluntary guidelines for CSR spending/reporting. Others like France, Denmark, Sweden, Indonesia and Malaysia have mandatory guidelines, but they follow a specific code and all companies do not come under the purview of mandatory guidelines. There is no strong legislation, as in India, for CSR spending.  Section 135 of Companies Act makes it mandatory for all the companies with turnover of Rs.1,000 crore and more or a net worth of Rs.500 crore and more or net profit of Rs.5 crore and more  to spend at least two percent of their three-year average profit every year on CSR activity. If the company fails to spend such amount, the Board shall give in its report the reasons for not spending. The paper investigates the CSR spending status of BSE listed companies for the year 2014-15. Data is collected from Business Responsibility Reports and Annual Reports of BSE listed companies and also grades are given to companies based on their CSR expenditure. Thus CSR Act has made companies understand their responsibilities towards the society and act conscientiously. It has opened new opportunities for all stakeholders to devise innovative ways to contribute to equitable social and economic development.

Keywords: CSR, Business Responsibility Reports, Companies Act 2013, Section 135, CSR Spending