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CSR Advisory Section 135

Every BRSR-mandated company is also a CSR-mandated company. We help Indian companies design impactful CSR programmes, ensure Companies Act 2013 Section 135 compliance, measure social returns, and integrate CSR with their broader ESG strategy.

S.135
Companies Act 2013
2%
Avg Net Profit Spend
Sch VII
Eligible Activities
MCA
Form CSR-2 Filing
Applicability

Who Needs CSR Compliance?

Companies Act 2013 Section 135 mandates CSR spending for companies meeting any of these thresholds in the preceding financial year:

₹500 Cr+
Net Worth
Companies with net worth of ₹500 crore or more.
₹1,000 Cr+
Turnover
Companies with turnover of ₹1,000 crore or more.
₹5 Cr+
Net Profit
Companies with net profit of ₹5 crore or more.
Our Services

Comprehensive CSR Advisory

01

CSR Policy Design

Board-approved CSR policy aligned with Schedule VII activities, company values, and community needs. Focus area identification, geographic prioritisation, and governance framework.

02

CSR Programme Design

Multi-year CSR programme architecture. Thematic areas: education, healthcare, environment, livelihood, women empowerment, rural development. Project design, partner selection, and budget allocation.

03

NGO Due Diligence

Implementing agency screening and selection. FCRA status verification, financial health assessment, capacity evaluation, track record review, and governance check before partnering.

04

Impact Assessment

Social Return on Investment (SROI) analysis, outcome measurement, beneficiary surveys, and impact documentation. Mandatory for companies spending ₹10 crore+ on CSR.

05

CSR Reporting & Filing

Annual Report on CSR (Board Report annexure), Form CSR-2 filing with MCA, CSR committee meeting documentation, and unspent amount transfer management.

06

CSR-ESG Integration

Align CSR programmes with BRSR Principle 8 (Inclusive Growth) and UN SDGs. Map CSR spending to ESG KPIs. Unified reporting for investors and regulators.

BRSR compliance →
Schedule VII

Eligible CSR Activities

Companies Act Schedule VII defines eligible CSR activities. We help you select focus areas aligned with your business, geography, and stakeholder expectations.

Eradicating Hunger & Poverty

Nutrition, malnutrition, sanitation, safe drinking water programmes for underserved communities.

Education & Skills

Promoting education, vocational skills, livelihood enhancement, and special education for differently-abled.

Gender Equality

Women empowerment, setting up homes for women, orphans, and senior citizens. Reducing inequality.

Environmental Sustainability

Ecological balance, conservation of natural resources, animal welfare, agroforestry, soil conservation.

Heritage & Art

Protection of national heritage, art, culture, restoration of historical buildings and sites.

Healthcare

Promoting healthcare including preventive healthcare, sanitation, and disease eradication programmes.

Compliance Calendar

Key CSR Deadlines

June 30

Form CSR-2 annual filing with MCA for the preceding financial year. Report on CSR spending, projects, and unspent amounts.

September 30

Transfer unspent CSR amount (other than ongoing projects) to Schedule VII fund within 6 months of financial year end.

Ongoing

CSR Committee must meet at least twice a year. Board must approve CSR policy and annual action plan. Impact assessment for ₹10 Cr+ spenders.

3-Year Rolling

Unspent CSR on ongoing projects must be deposited in a separate bank account and spent within 3 financial years. Else, transfer to Schedule VII fund.

View full ESG Compliance Calendar with 75+ deadlines →

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Frequently Asked Questions

CSR Section 135 FAQ

How is the 2% CSR spend calculated?

CSR spending is calculated as 2% of the average net profits of the company for the immediately preceding three financial years. Net profit is computed as per Section 198 of the Companies Act 2013. This includes profit before tax but excludes certain items like profit from overseas branches. Companies in their first qualifying year use the preceding year’s net profit as the base.

What happens if CSR money is unspent?

Unspent CSR amounts must be dealt with per Section 135(5) and (6). For ongoing projects: transfer unspent amount to a separate bank account within 30 days of year-end; spend within 3 financial years, else transfer to Schedule VII fund. For non-ongoing projects: transfer to a Schedule VII fund (PM-CARES, PM National Relief, or other notified fund) within 6 months of financial year-end (by September 30). Non-transfer attracts penalties.

Is CSR impact assessment mandatory?

Yes, for companies with CSR obligation of ≤10 crore or more, or with average CSR spending of ≤5 crore or more in the preceding 3 financial years. The impact assessment must be conducted by an independent agency and covers all CSR projects with an outlay of ≤1 crore or more. The assessment should evaluate outcomes against stated objectives, measure social impact, and provide recommendations. RSustain conducts impact assessments using SROI methodology.

How does CSR relate to BRSR reporting?

CSR spending, programme details, and community impact are disclosed under BRSR Principle 8 (Inclusive Growth & Equitable Development). BRSR asks about CSR projects, input-output-outcome reporting, procurement from MSMEs and local suppliers, and the percentage of input material sourced from local/small producers. Companies that integrate CSR data with BRSR reporting demonstrate a coherent approach to social impact and score better on ESG ratings.

Can CSR spending count towards ESG targets?

CSR spending on environmental projects (Schedule VII item iv — environmental sustainability, ecological balance, conservation) can support ESG environmental targets. Similarly, CSR on education, healthcare, and livelihood supports social KPIs. However, CSR is legally separate from operational ESG performance — ESG rating agencies evaluate both independently. A company with strong CSR but weak operational ESG performance (e.g., high emissions, poor safety) will not score well overall. The best approach is to align CSR themes with material ESG topics identified through materiality assessment.

Design Impactful CSR. Stay Compliant.

Book a consultation to discuss CSR programme design, impact assessment, or Section 135 compliance.

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