Beyond CSR Compliancea Case Study on Coal India Ltd and Tata Steel Ltd

Abstract

India is the first country in the world to make Corporate Social Responsibility (CSR) a mandatory provision by introducing Section 135 of the Companies Act, 2013 and the Companies (Corporate Social Responsibility) Rules, 2014 which became effective from April, 2014. CSR is a statutory obligation for the corporate to undertake certain responsibilities towards economy, society and environment in which it operates and contribute to the sustainable development of the country as a whole. Before the introduction of Companies Act, 2013, several committees and guidelines were formed by several Ministries/Departments for CSR compliance, but those concepts were mainly voluntary and philanthropist in nature. Since the introduction of the new Companies Act, 2013, CSR spending is compulsory for both government and private sector companies+ which accelerated the spending from 6% to 8%, projects also increased by 25% during the last four years. Presently the Government is focusing on coherent CSR policy and as a result the Ministry of Corporate Affairs (MCA) has set up a Legal Sub-Committee to review the mandatory CSR compliance.

This article put focus on CSR activities of two such companies viz, Coal India Ltd and Tata Steel Ltd for the financial year 2017- 18 whose percentage compliance in terms of CSR is 309% and 271% of their average net profit of previous three years.