CSR implementing agency set up by a corporate

Others 444 views 2 replies

Geetha Gupta

Accountant

325 Points Posted on 10 April 2021

Dear all,

CSR activities can be implemented by a company through an NGO established by itself.

Can others, who want to do charitable activities, also use that NGO or will it be used solely by the company that set it up?

The words - established by the company, either singly or along with any other company - in Companies (Corporate Social Responsibility Policy) Rules, 4(1)(a) seem to indicate that a NGO set up by a company is solely for its use only. Or if it is a joint set up, with other corporate entities, those who set it up will use it. It looks as if such an NGO will not be able to implement projects for any other entity.

Thank you in advance

Regards

Geetha Gupta

Replies (2)

Vibs Ravat

18 Points Posted on 20 April 2021

Other companies can also make donations under CSR activity thru that charitable trust, and it will fall under clause (d) and therefore the charitable trust should be MANDATORILY into those activities for a period of atleast 3 years in order to be eligible to undertake CSR activities for other companies..

Geetha Gupta

Accountant

325 Points Posted on 22 April 2021

Dear all

In a NGO be where desirous/founding persons are a combination of Natural persons and Artificial judicial persons(AJP),

1) Will such a NGO be considered as having been set up by that AJP, as per CSR Rule 4(1)(a), if one of the AJP is a company ?

2) An NGO set up by another company/AJP means, that company/AJP, through its authorised signatory, will have to subscribe to the MOA of the NGO as its founder member. Can the company/AJP, thru the authorised signatory, be a part of only desirous/founding persons and not be a part of the 1st or subsequent governing body/Board of Directors? In general, having a representative of an company in a governing position can lead to interference in the NGO's activities. Can a NGO restrict some categogory of members from ever becoming a part of governing body, with or without voting rights.

Regards,

Geetha Gupta