CSR Compliance Software for Company Secretaries: Section 135 – Corporate Social Responsibility

Section 135 of the Companies Act, 2013 and the Companies (CSR) Rules mandate eligible companies to spend 2% of average net profit on Corporate Social Responsibility. CSR Committee, policy, and annual action plan are required. The Companies (Accounts) Second Amendment Rules, 2023 clarified CSR-2 filing. CSR compliance software automates policy, annual action plans, board resolutions, and board report disclosures.

Companies Act 2013 Provisions – Section 135 & CSR Rules

Section 135 applies to companies meeting specified net worth, turnover, or net profit thresholds. Eligible companies must constitute a CSR Committee, formulate a CSR Policy, and spend at least 2% of average net profit of the preceding three financial years on CSR activities. Schedule VII lists eligible activities. Unspent amount must be transferred to specified funds. Board report must disclose CSR initiatives.

• CSR Committee constitution
• CSR Policy
• Annual action plan
• Board resolution on expenditure
• Board report disclosure

Documents Required for CSR Compliance

• Board resolution (committee, policy, expenditure)
• CSR Policy document
• Annual action plan
• Board report disclosure text

Manual vs Automated CSR Document Drafting

CSR documents involve prescribed amounts, project-wise tables, Schedule VII mapping, and board report disclosure. Manual drafting is time-consuming and error-prone.

• Manual: 3–5 hours; project table built manually
• Automated: 30–60 minutes; project table structure pre-built
• Manual: Prescribed amount calculated manually
• Automated: Amounts and percentages auto-calculated

Software Automation Process for CSR Compliance

1. Select company – Company details load from database.
2. Enter financial year and amounts – Prescribed CSR (2%), amount spent, unspent.
3. Enter committee members – Names, chairman designation.
4. Enter projects – Project name, Schedule VII item, budget, mode (direct/agency), status.
5. Enter policy outline – CSR policy summary.
6. Generate documents – CSR policy, annual action plan, board resolution, board report disclosure, unspent transfer resolution (if applicable).

How CSR Compliance Software Automates Drafting

CSR compliance software generates CSR policy, annual action plans with project-wise tables (Schedule VII, budget, mode), board resolutions, and board report disclosure text. Use with directors report software and board meeting software. See the full event-based compliance guide.