The Ministry of Corporate Affairs (MCA) has amended the Corporate and social Responsibilities (CSR) Rules under the Companies Act to provide greater transparency and flexibility to the corporate sector.
Amended CSR framework include mandating Impact Assessment for big CSR projects and revamping the reporting formats of the Board report.
The other major changes include mandatory disclosure of all CSR projects and activities besides CSR Committee’s composition on the company’s website.
The MCA has also now stipulated that an Annual action plan for CSR has to be presented to the company Board for its approval.
At the same time, the detailed guidelines have prescribed the modalities of spending the funds that have to be earmarked from the profits. Besides, it has mandated registration of agencies implementing CSR activities on behalf of companies. The rules come after the government decriminalised the provisions related to CSR spending and exempted companies with under Rs 50 lakh annual obligation from setting up dedicated committees.