Context:
10th report on ‘Demands for Grants (2025-26)’ of Ministry of Corporate Affairs (MCA) highlights various issues regarding Corporate Social Responsibility (CSR)
Corporate Social Responsibility (CSR):
- CSR refers to the accountability of companies to contribute to the social, economic, and environmental development of society.
- It is a corporate initiative to assess and take responsibility for the company’s effects on the environment and social welfare.
- India is the 1st country to mandate CSR spending.
- Governed by Section 135 of the Companies Act, 2013.
- Applicable to companies meeting any of the following thresholds –
- Net worth of ₹500 crore or more.
- Turnover of ₹1,000 crore or more.
- Net profit of ₹5 crore or more.
- Companies must spend at least 2% of their average net profits from the preceding 3 financial years on CSR activities.
- A CSR Committee must be constituted to formulate and recommend a CSR policy and monitor CSR activities.
- Companies (Amendment) Act, 2019 introduced stricter compliance measures for CSR.
- Unspent CSR funds must be transferred to a specified fund within 6 months of the financial year-end.
- Activities Covered Under CSR (Schedule VII of the Companies Act, 2013) –
- Eradicating hunger, poverty, and malnutrition.
- Promoting education, gender equality, and empowering women.
- Combating diseases like HIV/AIDS and ensuring environmental sustainability.
- Contributions to the PM’s National Relief Fund or other government funds for socio-economic development.
- Rural development projects and slum area development.
Source: ET
Previous Year Question
In the context of finance, the term ‘beta’ refers to:
[UPSC Civil Service Exam – 2023 Prelims]
(a) the process of simultaneous buying and selling of an asset from different platforms
(b) an investment strategy of a portfolio manager to balance risk versus reward
(c) a type of systemic risk that arises where perfect hedging is not possible
(d) a numeric value that measures the fluctuations of a stock to changes in the overall stock market
Answer: (d)