Section 135 – Corporate Social Responsibility (CSR)
Key Points:
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Companies meeting certain thresholds (e.g., net worth ₹500 crore, turnover ₹1000 crore) are required to spend 2% of their average net profit on CSR activities.
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The company must establish a CSR Committee to oversee and implement CSR initiatives.
Compliance Steps:
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Form a CSR Committee comprising at least 3 directors, with at least one independent director.
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Ensure the CSR policy is aligned with the objectives set out by the committee and submit a report to the board.
Example:
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Larsen & Toubro (L&T) has consistently met its CSR obligations by investing in education, healthcare, and sustainable development. It prepares an annual CSR report, detailing its contributions and their impact.
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