Report of High Level Committee on Corporate Social Responsibility
The report of the High-Level Committee on Corporate Social Responsibility (CSR) headed by Corporate Affairs Secretary Injeti Srinivas has submitted the report to the Minister of Finance and Corporate Affairs Nirmala Sitharaman.
Recommendations of the Committee
- The CSR spend by corporates should become tax-deductible i.e. the expenses towards CSR should be eligible for deduction in the computation of taxable income.
- The companies must be allowed to carry forward the unspent balance for a period of 3-5 years.
- Aligning Schedule VII under the companies act 2013 with the Sustainable Development Goals (SDG) by adopting an SDG plus framework (which would additionally include sports promotion, Senior Citizens’ welfare, welfare of differently-abled persons, disaster management and heritage protection).
- Balancing local area preferences with national priorities, introducing impact assessment studies for CSR obligation of ₹5 crore or more, and registration of implementation agencies on MCA portal.
- Developing a CSR exchange portal to connect contributors, beneficiaries and agencies.
- Allowing CSR in social benefit bonds.
- Promoting social impact companies, and third-party assessment of major CSR projects.
- CSR spending must be a board-driven process to provide innovative technology-based solutions for social problems and the companies having CSR prescribed amount below Rs 50 lakh may be exempted from constituting a CSR Committee.
- The violation of CSR compliance may be made a civil offence and shifted to the penalty regime.
The High-Level Committee tasked to review the existing CSR framework and make recommendations on strengthening the CSR ecosystem, including monitoring implementation and evaluation of outcomes has stated that CSR must not be seen as a means of resource gap funding for government schemes as it discourages passive contribution of CSR into different funds included in Schedule VII of the Act.