- The Minister of Corporate Affairs (MCA) has constituted a Committee to review enforcement of Corporate Social Responsibility (CSR) provisions under Companies Act, 2013.
- The 12-member committee will be headed by Regional Director (Western Region) Manmohan Juneja. Two Sub Committees are also formed to aid and assist the Steering Committee.
- The Committee will review the functioning of CSR enforcement and will recommend a uniform approach for its enforcement.
- It will revisit guidelines for enforcement of CSR provisions and basis, including structure of Centralised Scrutiny and Prosecution Mechanism (CSPM).
- It will also look at methodologies for monitoring of compliance by companies with CSR norms for having an effective CSPM.
- It will also revisit Schedule VII of Companies Act, 2013 pertaining to the board list of CSR activities that can be taken up under the Act on basis of references received from various stakeholders.
- Under Companies Act, 2013, certain class of profitable companies (entities) are required to shell out at least 2% of their three-year annual average net profit towards CSR activities.
- In case of non-compliance, these companies have to furnish reasons to Ministry of Corporate Affairs (MCA).In recent times, MCA has come across rising instances of non-compliance with CSR requirement.
- As per the Office Order issued by the Ministry of Corporate Affairs, the Committee would have to submit their recommendations within 60 days to the Ministry. The guidelines issued will empower the Committee to invite any person of appropriate stature having expertise with the Companies Act.
Source: Hindustan Times