Overview
Corporate Social Responsibility (CSR) is a statutory obligation under Section 135 of the Companies Act, 2013. A company must spend on CSR if, in the preceding financial year, it had net worth of ₹500 crore or more, turnover of ₹1,000 crore or more, or net profit of ₹5 crore or more. ESG reporting for India’s top 1,000 listed companies by market capitalisation is mandated through SEBI’s Business Responsibility and Sustainability Report (BRSR). CSR is about spending on eligible activities, while ESG reporting is about disclosing environmental, social and governance performance.
Services in This Category
- CSR Compliance and Project Governance: Applicability, the CSR committee and policy, the annual action plan, implementing agencies, unspent amounts, impact assessment and CSR-2 reporting.
- ESG and BRSR Reporting Support: BRSR preparation, BRSR Core indicators, data collection systems and governance of ESG disclosures.
Who Needs This Category
Companies crossing the Section 135 thresholds, listed entities in the top 1,000 by market capitalisation, and unlisted companies that are voluntarily adopting ESG reporting for lenders or supply-chain customers.
CSR & ESG in Chennai / Tamil Nadu
CSR and BRSR requirements are national. Companies in Tamil Nadu often implement CSR through implementing agencies in the state that are registered with CSR-1. KVA supports companies across India, and companies in Chennai from its Chennai office.
CSR Applicability and Governance
CSR obligations apply to companies that meet the statutory applicability thresholds and conditions. Once applicable, the company should evaluate its CSR policy, governance approvals, eligible activities, spending obligations and reporting requirements against the current rules.
- Assess statutory applicability
- Review the CSR policy and governance structure
- Identify eligible activities and implementing arrangements
- Track approved expenditure and supporting records
- Complete the applicable disclosures and reporting
ESG as a Broader Management Framework
ESG extends beyond statutory CSR spending. It can cover environmental practices, social factors, governance controls, stakeholder expectations and the quality of non-financial information used by management and investors. The appropriate scope should be proportionate to the organisation and its reporting obligations.
CSR, ESG and BRSR Compared
The three terms are linked but not interchangeable.
| Aspect | CSR | ESG | BRSR |
|---|---|---|---|
| Nature | Statutory spending duty for qualifying companies | Framework for measuring impact | SEBI disclosure format |
| Applies to | Companies meeting the thresholds | Voluntary, often investor-driven | Top listed companies |
| Governing source | Section 135 | Frameworks and investor standards | SEBI listing regulations |
Typical CSR Focus Areas under Schedule VII
CSR spending must fall within listed areas.
| Area | Examples |
|---|---|
| Health and sanitation | Hospitals, clean water, hygiene programmes |
| Education | Schools, scholarships, skills |
| Environment | Conservation, tree planting |
| Rural development | Infrastructure, livelihoods |
Documentation and Reporting
A defensible CSR or ESG process depends on traceable evidence: approvals, project records, expenditure support, impact information, policies and disclosures. The reporting framework should match the company's applicable legal and stakeholder requirements rather than rely on generic claims.
How KVA Handles CSR & ESG
Karthick Vijayakumar & Associates, Company Secretaries, supports you through each stage with a single point of contact and a clear record of what has been done.
| Step | Stage | What KVA does |
|---|---|---|
| 1 | Requirement review | We understand your entity, objective and timeline, and confirm what CSR & ESG involves for your specific facts. |
| 2 | Document checklist | You receive a clear list of documents, particulars and approvals needed, with gaps flagged early. |
| 3 | Preparation and filing | Our team prepares, reviews and files the required forms and records, and tracks each acknowledgement. |
| 4 | Completion and follow-up | We hand over final records and explain the compliance that follows, so nothing is missed afterwards. |
Why Karthick Vijayakumar & Associates
Work is handled by company secretaries who deal with statutory filings and governance every day.
Timelines for CSR & ESG are tracked so that approvals and filings do not slip.
Plain-language updates at each stage, with no guesswork about what is pending.
Organised, decision-ready documentation that supports audits, banks and future filings.
Frequently Asked Questions
No. It applies only to companies that meet the net worth, turnover or net profit thresholds in Section 135(1).
At least 2% of the average net profits of the three immediately preceding financial years, calculated under Section 198.
No. BRSR is mandated by SEBI for the top 1,000 listed entities. Other companies may adopt it voluntarily.
No. CSR is a spending obligation on specified activities. ESG covers how the company manages and discloses its environmental, social and governance performance.
Expenditure incurred to meet the Section 135 obligation is not deductible as a business expense under the income-tax law. This should be confirmed under the Income-tax Act, 2025.
Section 135 of the Companies Act, 2013, Schedule VII and the Companies (Corporate Social Responsibility Policy) Rules, 2014, as amended.
Companies that meet the net worth, turnover or net profit thresholds in any financial year, as stated in Section 135, must follow its requirements.
Environmental, Social and Governance factors are used to assess how a company manages its environmental impact, relationships with people and the quality of its governance.
CSR is a legal spending and governance obligation for covered companies, while ESG is a broader approach to measuring and disclosing sustainability performance across operations.
No. CSR expenditure is not allowed as a business expense under the Income-tax law, though some contributions may qualify for other deductions as the law provides.
A policy approved by the board stating the activities to be undertaken from Schedule VII, the approach to implementation and monitoring, and the mechanism for reporting.
In the board’s report and on the MCA through form CSR-2, together with the company’s website disclosure as the rules require.
Activities listed in Schedule VII, such as education, health, rural development, environment, and contributions to specified funds.
Yes. The agency must be a registered entity with CSR-1 registration and 12A and 80G registration where applicable, and a written agreement should record the project.
The Business Responsibility and Sustainability Report is a SEBI-prescribed disclosure on ESG performance for the top listed entities by market capitalisation.
A board-approved framework stating the company’s commitments, goals, responsibilities and metrics on environmental, social and governance matters.
Energy use, emissions, water, waste, workforce statistics, safety, supply-chain information and governance records, collected using consistent methods.
Increasingly yes. Many investors and lenders use ESG data in assessing risk and eligibility, which makes credible reporting a business advantage.
By mapping material topics, collecting baseline data, adopting a policy and building a simple reporting process, which can be expanded as the business grows.
We advise on applicability, policy and committee set-up, project governance and reporting, and prepare disclosures aligned with the applicable law and frameworks.
Reviewing Your CSR or ESG Obligations?
Contact Karthick Vijayakumar & Associates to discuss the requirements that apply to your company.
Contact UsSpeak with Karthick Vijayakumar & Associates
Third Floor, New No. 599, Old No. 230, Konnur High Road, Ayanavaram, Chennai, Tamil Nadu, 600023, India
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