In a recent reply to an unstarred question at Lok Sabha, the Minister of State in the Ministry of Corporate Affairs ( MCA ) stated that the existing legal and corporate governance framework provides for an effective and result oriented mechanism for CSR activities implemented by the Companies.
In a reply to the questions raised by Shri Eswarasamy K, whether the Government has developed any strategy for implementation of Corporate Social Responsibility ( CSR ) policy to make it more effective and result-oriented and if so, the details thereof;
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and the details of expenditure/contribution by Public Sector Undertakings (PSUs) and private companies/corporate houses along with the details of works/activities undertaken by them during the last three years and the current year under CSR in various States including Tamil Nadu, year/company/State/UT-wise, the Minister of State at the Ministry of Corporate Affairs, Harsh Malhotra stated that the The legal framework for Corporate Social Responsibility ( CSR ) has been provided under Section 135 of the Companies Act, 2013 (‘Act’), Schedule VII of the Act and Companies (CSR Policy) Rules, 2014.
It was further added that, “Under the Act, every CSR mandated company has to constitute a CSR Committee. The Committee formulates and recommends the CSR policy and the Board of the company plans, decides, executes and monitors the CSR activities of the company.
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The Board of the company is required to disclose the CSR Policy implemented by the company in its Board report and has to satisfy itself that the funds so disbursed have been utilised for the purposes and in the manner as approved by it, and the Chief Financial Officer or the person responsible for financial management shall certify to this effect. The CSR framework is disclosure based and expenditure on CSR activities is required to be audited by the statutory auditors of the company.”
The reply also clarified that the Ministry has notified the Companies (Auditor’s Report) Order, 2020, (“CARO, 2020”) applicable from FY 2021-22 which requires auditors to state details of any unspent CSR amount. The existing legal and corporate governance framework provides for an effective and result oriented mechanism for CSR activities implemented by the Companies.
(b): All data related to CSR filed by companies in the MCA-21 registry is available in public domain and can be accessed at CSR.”
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