₹100 Cr Companies to soon face Mandatory CSR Obligations from MCA? Know More
Reports suggest that proposed amendments are being effected to the Companies Act, 2013 to widen the scope of mandatory CSR compliance for medium-sized companies.
Recent reports circulating in the public domain indicate that an amendment is being effected to the Companies Act, 2013 through the Companies (Amendment) Bill, 2025 to propose a substantial expansion of India’s Corporate Social Responsibility (CSR) framework by lowering the financial thresholds that trigger mandatory CSR obligations under Section 135 of the Act. As of the time...
Recent reports circulating in the public domain indicate that an amendment is being effected to the Companies Act, 2013 through the Companies (Amendment) Bill, 2025 to propose a substantial expansion of India’s Corporate Social Responsibility (CSR) framework by lowering the financial thresholds that trigger mandatory CSR obligations under Section 135 of the Act.
As of the time of publication of this story, an official version of the Bill is yet to be located on government portals, however multiple extracts and extracts attributed to the Bill and its Statement of Objects and Reasons have been published by numerous sources online.
What does the Bill contain?
Under the existing CSR regime, companies are required to undertake CSR activities if, during the immediately preceding financial year, they have a net worth of ₹500 crore or more; turnover of ₹1,000 crore or more; or net profit of ₹5 crore or more.
Such companies must spend at least two per cent of their average net profits of the preceding three financial years on CSR initiatives.
As per the reported text of the Companies (Amendment) Bill, 2025, the government is considering lowering these thresholds to bring more companies within the CSR ambit.
The proposed amendment reportedly seeks to make CSR applicable to companies having a net worth of ₹100 crore or more; turnover of ₹500 crore or more; or net profit of ₹3 crore or more during the immediately preceding financial year.
The intent is to include a larger number of medium-sized companies in CSR funding, increasing private sector participation in social and community development.
The Statement of Objects and Reasons attributed to the Bill notes that CSR spending has already resulted in substantial investment in areas such as education, healthcare, sanitation, skill development, and social welfare. Expanding the CSR base is slated to increase the magnitude and actual reach of CSR operations across the country.
In addition to revising the financial thresholds, the Bill reportedly directs companies meeting the revised thresholds to constitute a Corporate Social Responsibility Committee of the Board, which shall consist of three or more directors.
The proposed framework requires the inclusion of at least one independent director and at least one director with extensive experience in planning and implementing CSR projects. However, where a company is not required to appoint an independent director under Section 149(4) of the Act, the CSR Committee may consist of two or more directors only.
Prior legislation did not mandate the appointment of independent directors but still had to include one on the CSR Committee. The proposed structure is intended to ensure expert oversight in CSR decision-making while aligning governance requirements and the company’s broader board composition.
Separately, the Ministry of Corporate Affairs has already notified the Companies (Corporate Social Responsibility Policy) Amendment Rules, 2025, effective from July 14, 2025, which tightens compliance requirements for CSR implementing agencies through a revised e-Form CSR-1.
If enacted in the form currently being reported, the proposed amendments could significantly expand CSR obligations across India’s corporate landscape, bringing in more entities under the umbrella of CSR.
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