Strengthening the CSR framework is a profitable idea

Context:

Since the establishment of the Corporate Social Responsibility (CSR) regime in India under Section 135 of the Companies Act 2013, the CSR spending has risen from in 2020-21. However, the CSR spending is not in sync with the profits made by Indian and foreign companies.

The Estimates:

• Criteria for CSR spending: Besides, there were 2,926 companies in 2020-21 with zero spend on CSR while companies spending less than the prescribed limit of 2% rose from 3,078 in 2015-16 to 3,290 in 2020-21.
• Transferable in nature: If a company spends an amount in excess of the minimum 2%, as stipulated, the excess amount is liable to be set off against spending in the succeeding three financial years.