What is CSR? Corporate Social Responsibility (CSR) encompasses the practices and policies that companies implement to operate ethically and sustainably. The focus of CSR extends beyond mere profit generation, aiming to contribute positively to social, environmental, and economic well-being.
In India, CSR is mandated by law. According to Section 135 of the Companies Act, 2013, companies that meet certain financial criteria are required to spend a minimum of 2% of their average net profits on CSR activities. The law identifies specific focus areas, including health, education, sanitation, environment, and rural development.
Q1. How has CSR evolved in India?
Answer: CSR in India has shifted from being a voluntary effort to a strategic initiative that addresses critical social and environmental challenges. It now plays a significant role in national development, especially with Public Sector Undertakings (PSUs) leading impactful projects.
Q2. What are the key focus areas of CSR activities in India?
Answer: Major focus areas include health and nutrition, education and skill development, sanitation and drinking water, women empowerment, environmental sustainability, and support for art, culture, and sports.
Q3. What role do PSUs play in CSR in India?
Answer: Public Sector Undertakings (PSUs) are leaders in CSR due to their extensive resources and reach. They focus on poverty alleviation, healthcare, education, and infrastructure development, significantly contributing to India’s socio-economic upliftment.
Q4. How does CSR benefit companies?
Answer: Companies engaging in CSR enhance their brand reputation, increase employee satisfaction by fostering a sense of purpose, and improve operational efficiency through sustainable practices that lower costs and boost profitability.
Q5. What challenges are faced in implementing CSR?
Answer: Challenges include a lack of expertise in identifying impactful activities, inefficient fund allocation, limited participation from small and medium enterprises, and difficulties in measuring CSR initiative effectiveness.
Question 1: What is the minimum percentage of net profits that companies must spend on CSR activities as mandated by Indian law?
A) 1%
B) 2%
C) 5%
D) 3%
Correct Answer: B
Question 2: Which of the following is NOT a focus area of CSR activities in India?
A) Sanitation and drinking water
B) Space exploration
C) Education and skill development
D) Health and nutrition
Correct Answer: B
Question 3: What significant role do PSUs play in CSR initiatives?
A) They have limited reach
B) They lead impactful projects
C) They avoid CSR activities
D) They only focus on profit-making
Correct Answer: B
Question 4: How does CSR contribute to environmental sustainability?
A) By promoting waste management
B) By ignoring climate change
C) By increasing pollution
D) By focusing solely on profits
Correct Answer: A
Question 5: Which of the following is a challenge faced by companies when implementing CSR?
A) Abundance of expertise
B) Inefficient use of funds
C) Increased employee satisfaction
D) Clear measurement of effectiveness
Correct Answer: B
Question 6: What is a key benefit of CSR for companies?
A) Decreased operational efficiency
B) Enhanced brand reputation
C) Lower employee morale
D) Reduced customer trust
Correct Answer: B
Question 7: What aspect of CSR helps marginalized communities?
A) Increased profits
B) Training and education programs
C) Focus on luxury markets
D) Ignoring social issues
Correct Answer: B
Kutos : AI Assistant!
