The Companies Act, 2013, makes it mandatory for listed and unlisted organisations of a certain size and net worth to spend at least two per cent of their average net profit towards corporate social responsibility ( CSR). Recent media reports have talked about how more than half of the 460 firms that filed their annual reports on CSR as of January 31, 2016, failed to spend the prescribed amount for 2014-15. In Irresponsible gaps in corporate social responsibility (1-15 September, 2015) DownTo
Earth pointed out that the rot is much deeper. Some 6,000 companies are required to invest in CSR under the Companies Act. But according to Ministry of Corporate Affairs data, two-thirds have failed to meet the two per cent spending mandate.