Corporate Social
Responsibility
As A Business Strategy
BBA - 6A
Presented By:-
Nishchay
2021020079
What Is Corporate
Social Responsibility?
CSR refers to a company’s
commitment to operating in an CSR is an extension of the
economically, socially, and principles of sustainable
environmentally sustainable development and is based on
manner. This involves a the idea that companies have a
responsibility to act in the best
responsibility to contribute to
interests of society and to balance
the needs of stakeholders,
the long-term health and well-
including customers, employees, being of society and the
shareholders, suppliers, and the environment.
community.
Four Types Of Corporate Social
Responsibility
Environmental Responsibility Ethical Responsibility
Environmental responsibility refers to the Refers to a company’s commitment to operate their
organization’s commitment to sustainability business in an ethical manner that upholds human
rights principles, such as fair treatment of all
and environmentally friendly operations.
stakeholders.
Philantropic Responsibility Economic Responsibility
Refers to a corporation’s aims, goals and Economic responsibility refers to the practice of
objectives for actively bettering society as making financial decisions based on a
a whole. commitment to doing good
Benefits Of Corporate
Social Responsibility
Better Brand Operational costs
Recognition savings
Positive Business Better financial
Reputation performance
Increased sales and Easier access
customer loyalty to capital
Provisions of CSR Under Section 135 of
Companies Act 2013
Section 135(1) Provision to Section 135(1)
Every company having net worth of
rupees five hundred crore or more, or
turnover of rupees one thousand crore Provided that where a company is
or more or a net profit of rupees five not required to appoint an
crore or more during immediately independent director under sub-
preceding financial year shall constitute section (4) of section 149, it shall
a Corporate Social Responsibility have in its Corporate Social
Committee of the Board consisting of Responsibility Committee two or
three or more directors, out of which at more directors.
least one director shall be an
independent director.
Provisions of CSR Under Section 135 of
Companies Act 2013
Section 135(2) Section 135(3)
(a) formulate and recommend to the Board, a
Corporate Social Responsibility Policy which
shall indicate the activities to be undertaken
The Board's report under sub-section (3) by the company in areas or subject, specified
of section 134 shall disclose the in Schedule VII;
composition of the Corporate Social (b) recommend the amount of expenditure to
Responsibility Committee. be incurred on the activities referred to in
clause (a); and
(c) monitor the Corporate Social
Responsibility Policy of the company from
time to time.
Provisions of CSR Under Section 135 of
Companies Act 2013
Section 135(4) Section 135(5)
a) after taking into account the The Board of every company referred
recommendations made by the to in sub-section (1), shall ensure that
Corporate Social Responsibility the company spends, in every financial
Committee, approve the Corporate year, at least two per cent of the
Social Responsibility Policy for the average net profits of the company
company and disclose contents of such made during the three immediately
Policy in its report and also place it on
preceding financial years, in
the company's website, if any, in such
pursuance of its Corporate Social
manner as may be prescribed
Responsibility Policy:
Provisions of CSR Under Section 135 of
Companies Act 2013
1st Provision to Section 135(5) 2nd Provision to Section 135(5)
Provided that the company shall Provided further that, if the company
give preference to the local area fails to spend such amount, the
and areas around it where it Board shall, in its report made under
operates, for spending the amount clause (o) of sub-section (3) of
earmarked for Corporate Social section 134, specify the reasons for
Responsibility activities not spending the amount.
Characteristics Of Corporate
Social Responsibility
Sustainable development practices
Transparency and accountability
Maintain good relationship management
Advocacy of human rights
Compliance with accepted standards on CSR
Ethical business practice
Importance of Corporate
Social Responsibilty
CSR improves the public image by publicising
the efforts towards a better society and
increasing their chance of becoming
favourable in the eyes of consumers.
CSR increases media coverage as media
visibility throws a positive light on the
organisation.
CSR enhances the company’s brand value by
building a socially strong relationship with
customers.
CSR helps companies to stand out from the
competition when companies are involved in
any kind of community.
The CSR Committee will formulate and recommend a
CSR policy to the Board. CSR policy shall point out the
activities to be undertaken by the company as
enumerated in Schedule VII of the Act.
Duties of CSR Committee will recommend the amount of
CSR expenditure to be incurred on the CSR activities to be
undertaken by the company.
Committee CSR Committee will monitor the CSR policy of the
Company from time to time.
The CSR Committee will establish a transparent
controlling mechanism for the implementation of the
CSR projects or programs or activities undertaken by
the company.
Sustainable
Development
Practices
Corporate social responsibility, or CSR,
involves balancing corporate citizenship
and environmental responsibility to give
back to the communities in which they
operate, which also supports long-term
business success. Socially responsible
companies preserve environmental
resources crucial to future generations,
according to the International Institute
for Sustainable Development.
Transparency and
Accountability
CSR demonstrates transparency by openly
disclosing activities, setting measurable
goals, engaging stakeholders, and
undergoing independent verification.
Accountability is ensured through compliance
with regulations, regular reporting,
integration into business strategy, addressing
failures, and continuous improvement.
Eligible Activities Under CSR
1. Eradicating hunger, poverty, and malnutrition.
2. Promoting education, including special education and employment-
enhancing vocational skills.
3. Promoting gender equality, empowering women, setting up homes and
hostels for women and orphans.
4. Reducing child mortality and improving maternal health.
5. Ensuring environmental sustainability, conservation of natural
resources, and ecological balance.
6. Animal welfare, including veterinary services and animal shelters.
7. R&D in the areas of sustainable development.
8. Contributions to the Prime Minister's National Relief Fund or any other
fund set up by the Central Government for socio-economic development.
Non-Eligible Activities Under
CSR
1. Activities that benefit only the employees or shareholders of the
company.
2. Routine operational expenses not directly related to CSR
initiatives.
3. Donations to political parties or organizations affiliated with
political causes.
4. Activities that generate income for the company, except when
such income is used for CSR purposes.
5. Activities that contravene any law or regulation.
Demerits Of Corporate
Social Responsibility
Subject to Losing Sight Of
Greater Scrutiny What Matters
Risk to Client can
Reputation become impatient
Rising Costs Of Investor’s
Operations resistance
How Is Corporate Social Responsibility
Related To Marketing?
Customers Channel Members
CSR activities that supports social 1)Enhanced Reputation
causes such as education, healthcare, 2)Improved Relationships
poverty alleviation can directly benefit
3)Risk Management
customers by improving access to
essential services. 4)Employee Engagement
CSR Reporting
With respect to CSR Reporting, the provisions are as
follows :
The Board’s Report referring to any financial year
initiating on or after the 1st day of April 2014 shall
include an annual report on CSR.
In the case of a foreign company, the balance sheet
filed shall contain an Annexure regarding a report on
CSR.
To Community
CSR fosters ethical business practices by engaging
Ethical communities through sustainable initiatives, promoting
social welfare, respecting human rights, supporting
Business education, healthcare, and environmental conservation,
thereby contributing positively to society's well-being
Practice and development.
To Government
CSR practices ethically towards government by adhering
to regulations, paying taxes promptly, engaging in
transparent lobbying practices, and supporting public
welfare initiatives.
FAQs Related to
Corporate Social Responsibility
Why CSR is mandatory? How much CSR is mandatory?
The Companies Act, 2013 provides for
CSR under section 135. Thus, it is It is mandatory for the
mandatory for the companies covered companies covered under
under section 135 to comply with the CSR section 135(1) of the Companies
provisions in India. Companies are Act, 2013 to spend 2% of their net
required to spend a minimum of 2% of profit over the proceeding three
their net profit over the preceding three
years as per the CSR policy.
years as CSR.
Case Study: Vardhaman Group
Vardhman Group has been making positive contribution to the society in the form of its
products and services in the field of textiles since about last 50 years. With a growing
realization in the organization to contribute more directly for the up-liftment of the
society, the interface with society has become multidimensional. Noteworthy
contribution has been made in the field of education, vocational training for skill
development, agriculture and environment conservation.
The Group’s initiatives towards CSR in the past include setting up of Aurobindo Public School at
Baddi, Sri Aurobindo College of Commerce & Management at Ludhiana, Village Cluster Adoption
Program (VCAP) for improvement in cotton quality for benefit of farmers, Research on Treated
Wastewater for Irrigation Purpose, Capability Enhancement Training Programs, providing aid during
disasters/natural calamities and energy saving and conservation of natural resources through
environmental management etc.
CSR Policy of the Company
1. PROMOTION OF EDUCATION: To continue our endeavor for promoting education by setting
up schools, colleges to deliver high quality education to students of all strata of society
including wards of VSSL employees. It, inter-alia, includes various other initiatives such as
grant of scholarships to deserving-needy students, computer education and supply of
equipments to students and developing innovative teaching methods.
2. ENVIROMENT PROTECTION AND ENERGY CONSERVATION: To protect environment and to
sustain and continuously improve standards of Environment, Health and Safety through the
collective endeavor of Company and its employees at all levels towards attaining world
class standards.
3. DEVELOPMENT OF HUMAN CAPITAL: To encourage the development of human capital
through skills development, vocational training programmes.
4. RURAL DEVELOPMENT: To contribute to development in rural areas through agricultural
research and knowledge sharing, productivity and quality and other agri-extension practices
such as soil and moisture conservation and watershed management etc.
Thank You
Have a Great Day
