CSR Obligations Under The Companies Act, 2013: A Critical Analysis
- IJLLR Journal
- 5 minutes ago
- 2 min read
Anu Kumari, Bennett University
Vaishnavee Goyal, Bennett University
ABSTRACT
The paper is a critical analysis of the Corporate Social Responsibility (CSR) requirements, presented in the Companies Act, 2013, and an assessment of its effects on corporate behaviour, the governance system and social development in India. The paper provides the background and the conceptualization of CSR, which forms the ground on which Section 135 and the CSR Rules came into force, which is why India is the first country to require CSR spending by qualifying companies. The analysis of the legislation and regulatory environment reveals the impact of statutory requirements in creating higher levels of accountability, systematic execution, and additional involvement of companies in community welfare programs. Comparative analysis of CSR policies of other countries shows that the world tends to take diverse approaches with most jurisdictions preferring voluntary or disclosure model of CSR policies as opposed to compulsory adherence. The paper also examines the overlap between corporate governance and CSR, and shows that good governance practices improve ethical behaviour, transparency, and trust in the stakeholders. The paper, in its incorporation of stakeholder theory, highlights the importance of meeting the demands and expectations of the various groups so as to achieve socially highly effective and sustainable CSR results. Critical cases of law and brand examples of how CSR can be utilised are given to show how the law can be applied in practice and judicial viewpoints. Regardless of these developments, the paper cites a number of challenges, such as poor guidelines, transparency issues, implementation lapses, greenwashing, and poor awareness of the populace to fully ensure the success of CSR initiatives. The paper draws a conclusion that, despite the fact that the Companies Act, 2013 has created a solid basis of responsible corporate behaviours, it is important to enhance regulatory controls, transparency of reporting, and impact-oriented approaches to the implementation of the transformational potential of CSR in India.
