How to Set Up a CSR Committee in an Indian Company: A Practitioner's Guide (2026)

Marpu Foundation
Jul 7
12 min read

The CSR Committee is the governance body that sits at the centre of a company's Corporate Social Responsibility work. It is created under Section 135 of the Companies Act 2013, formulates the CSR Policy and the Annual Action Plan, recommends CSR activities and expenditure to the Board, monitors the CSR programme, and shapes the tone the company brings to its social impact work.

Yet many companies set up the Committee reactively, in the weeks after they first cross the CSR applicability thresholds, and treat it thereafter as a formality that meets when the calendar demands. This underuses the Committee.

A CSR Committee designed with intention, composed thoughtfully, run with discipline, and connected to the broader compliance framework produces significantly stronger CSR than one that exists only to satisfy the statutory requirement.

This article walks through how to set up a CSR Committee in an Indian company: when the requirement applies, who sits on the Committee, what the Committee is responsible for, how it should meet and document its work, how it connects to the broader CSR compliance framework, common patterns that weaken Committees, and suggestions for setting up a Committee that genuinely strengthens the company's CSR.

It is written for the Company Secretary, the Chief Financial Officer, the Board's independent directors, the CSR head, and the founder or leadership team of a company setting up a CSR Committee for the first time or restructuring an existing one. The article is a practitioner-voice operational reference. It is not a substitute for the company's own Company Secretary, Chartered Accountant, statutory auditor, and Legal counsel review of specific Committee decisions and structure.

Important note: This article provides operational guidance on setting up a CSR Committee under Indian law as of April 2026. It is informational guidance and does not constitute legal, financial, or compliance advice. The CSR framework, including Section 135 of the Companies Act 2013 and the Companies (CSR Policy) Rules 2014, is subject to amendment by the Ministry of Corporate Affairs. Every Committee structure, composition, and operational decision should be reviewed by the company's Company Secretary, Chartered Accountant, statutory auditor, and Legal counsel before adoption. Verify against the current text of Section 135, the CSR Rules, and any recent MCA circulars before finalising the Committee.

When a CSR Committee Is Required

The starting point is understanding when a CSR Committee is required at all. Section 135 of the Companies Act 2013 sets out the applicability of CSR and the specific requirement to constitute a Committee.

Two thresholds matter for this question.

The CSR applicability threshold under Section 135(1). A company is required to comply with the CSR framework if, during any financial year, it meets any of the specified thresholds relating to net worth, turnover, or net profit. Companies that meet these thresholds must comply with the CSR requirement, including the constitution of a CSR Committee as set out in the Section
The exemption under Section 135(9). The Companies (Amendment) Act 2019 introduced a provision under which companies whose CSR obligation for a financial year does not exceed a specified amount are not required to constitute a CSR Committee. In such cases, the functions of the Committee are discharged by the Board itself

Companies should verify the current thresholds against the live text of Section 135 with their Company Secretary and Chartered Accountant, because the specific figures have been the subject of amendment across the years.

Two implications follow from this framework.

Larger companies with meaningful CSR obligations constitute a Committee. These are the companies for which the rest of this article is most directly relevant
Smaller companies with modest CSR obligations may not require a separate Committee. For these companies, the Board itself performs the Committee's functions, and the substantive discipline the article describes still applies, just held at the Board level

The Composition of the CSR Committee

Section 135(1) sets out the composition of the CSR Committee. The Committee is constituted by the Board and consists of three or more directors, out of which at least one director should be an independent director.

Several nuances of this requirement are worth naming.

The Committee consists of directors, not other executives. Company Secretaries, CFOs, HR heads, and CSR heads may attend Committee meetings, but the members of the Committee itself are directors of the company
At least one independent director should be on the Committee. This ensures that the Committee has an independent voice in its deliberations, which strengthens the governance dimension of CSR
Certain company categories have specific provisions. Companies that are not required to appoint an independent director under Section 149(4), and certain private companies and foreign companies, are subject to modified composition requirements. Companies in these categories should confirm the applicable requirement with their Company Secretary
The Board's discretion in choosing the specific directors matters. Beyond the statutory minimum, the Board should choose Committee members whose interests, backgrounds, and availability produce a Committee that will engage substantively with the CSR programme

The Committee's Responsibilities

Under Section 135(3), the CSR Committee has specific responsibilities that the article outlines below. These responsibilities are the core of what the Committee does.

A CSR Committee is a governance body, not a formality. Set up thoughtfully and run with discipline, it produces significantly stronger CSR than one that exists only to satisfy the statutory requirement.

1. Formulate and Recommend the CSR Policy

The Committee formulates the company's CSR Policy, which sets out the areas of CSR work the company will undertake, the approach the company will take, and the framework the CSR programme operates within. The Policy is recommended to the Board for approval.

2. Recommend the Amount of Expenditure

The Committee recommends to the Board the amount of expenditure to be incurred on CSR activities, based on the statutory obligation calculated under Section 135.

3. Monitor the CSR Policy

The Committee monitors the CSR Policy on an ongoing basis, reviewing whether the Policy is being implemented as intended, whether adjustments are needed, and whether the Policy remains fit for purpose as the company evolves.

4. Formulate and Recommend the Annual Action Plan

Following the January 2021 amendment to the CSR Rules, the Committee is also responsible for formulating and recommending to the Board an Annual Action Plan under Rule 5(2) of the Companies (CSR Policy) Rules 2014. The Annual Action Plan sets out the specific projects, execution approach, modalities of fund utilisation, and monitoring mechanism for the financial year.

5. Support the Broader CSR Governance

Beyond the statutory responsibilities, strong Committees support the broader CSR governance of the company, including engaging with implementation partners, considering long-term programme direction, and connecting CSR to the company's sustainability and stakeholder narrative.

How the Committee Should Meet

The Committee's meeting rhythm shapes whether the Committee engages substantively with CSR or treats the role as a formal box-tick. Several practices produce stronger meeting discipline.

1. A Regular Meeting Cadence

Committees that meet quarterly at minimum, with additional meetings as programme milestones require, engage more substantively with CSR than Committees that meet only when the annual calendar demands. The quarterly rhythm allows the Committee to review programme progress, respond to what is working and what is not, and shape the programme across the year rather than only at year-end.

2. Substantive Agendas

Committee meetings work best with agendas that focus on substance. Programme progress, partner reviews, financial deployment, upcoming decisions, and forward-looking discussion produce stronger meetings than agendas dominated by procedural items.

3. Documented Minutes

Committee minutes should record what was discussed, what was decided, what was recommended to the Board, and what actions were assigned. Minutes support the Committee's own memory across meetings, the Board's understanding of Committee work, and the statutory audit's verification of the CSR governance process.

4. Preparation Ahead of Meetings

Members prepare more meaningfully when materials are circulated in advance. Reports on programme progress, financial deployment, partner performance, and upcoming decisions should reach members with enough time to review before the meeting.

5. Follow-Through Between Meetings

The strongest Committees do not go dormant between meetings. Actions assigned at one meeting are pursued in the intervening weeks so that the following meeting can review progress rather than restart discussion.

What the Committee Documents

Beyond meeting minutes, the Committee produces or supervises several categories of documentation across the year.

The CSR Policy, formulated by the Committee and approved by the Board
The Annual Action Plan for each financial year under Rule 5(2)
Records of Committee meetings, including agendas, minutes, and actions
Recommendations to the Board on CSR spend, programme approvals, and partner selection
Programme progress reports the Committee reviews across the year
The Board's Report disclosures on CSR under Section 134, which draw on the Committee's work
Form CSR-2, the annual report on CSR, which reflects the Committee's oversight
Impact assessment references, where impact assessment applies under Rule 8(3)

This documentation supports the company's compliance across the framework and produces the audit trail that the statutory audit and any subsequent verification will draw on.

How the Committee Connects to the Broader CSR Framework

The CSR Committee does not exist in isolation. It sits within a broader set of governance and compliance structures that work together.

The Board of Directors, which considers the Committee's recommendations and provides final approval on the CSR Policy, Annual Action Plan, and CSR spend
The Company Secretary, who supports the Committee's procedural work, meeting notices, minutes, and coordination with the broader Board work
The Chartered Accountant and statutory auditor, who verify actual CSR spend against approvals and support the Board's Report disclosures
The CSR team or CSR head, who executes the day-to-day CSR programme and reports to the Committee
Implementing agencies, which deliver programmes on the ground and provide reports the Committee reviews
The Legal function, which supports compliance verification across the framework
BRSR reporting, for listed companies, which draws on the Committee's oversight and the programme's outcomes

The Committee's effectiveness depends significantly on how well these connections are running. A well-supported Committee with strong information flows from CS, CFO, CSR head, and implementing partners can engage substantively with the programme in a way that an isolated Committee cannot.

Five Common Patterns That Weaken CSR Committees

Across observed practice, five recurring patterns weaken CSR Committees even when the statutory composition is met.

1. The One-Meeting-a-Year Pattern

The Committee meets once a year to approve the Annual Action Plan and Board's Report, and otherwise goes dormant. This satisfies the minimum but misses the substantive value the Committee can add through year-round engagement.

2. The Rubber-Stamp Pattern

The Committee approves whatever the CSR team or implementing partners propose, without substantive review or challenge. This treats the Committee as a procedural checkpoint rather than a governance body, and produces weaker CSR than a Committee that engages actively.

3. The Weak Materials Pattern

Committee members receive materials shortly before meetings, or receive superficial materials that do not support meaningful review. Strong materials, circulated with enough time for review, are foundational to strong Committee work.

4. The Executive-Dominated Pattern

In some Committees, executive directors dominate discussion and the independent director's voice does not shape decisions. The independent director's role is precisely to bring independent judgement, and Committees that use this well produce stronger governance than those that do not.

5. The Isolated Committee Pattern

The Committee operates without meaningful information from the CSR team, the implementing partners, or the CFO on financial deployment. Committees that are isolated from the operational reality of the CSR programme can only engage at a distance, which limits their contribution.

Five Suggestions for a Strong CSR Committee

The following suggestions reflect practice that produces stronger CSR Committees. They are observations, not prescriptions.

1. Meet Quarterly at Minimum

A quarterly meeting cadence, with additional meetings when programme milestones require, produces substantively stronger Committee engagement than an annual rhythm. Quarterly review keeps the Committee close to the programme.

2. Invest in Committee Materials

Materials that support meaningful review, circulated with enough time for members to prepare, are foundational. Investment in materials pays significant returns in the depth of Committee discussion.

3. Use the Independent Director Genuinely

The independent director's presence is a statutory requirement, but their contribution is what makes it valuable. Committees that genuinely invite and use the independent director's judgement produce stronger governance than those that treat the role as compliance box-tick.

4. Connect the Committee to the CSR Team and Implementing Partners

Committees that hear directly from the CSR team, implementing partners, and CFO on programme progress engage more substantively than Committees that receive only summarised materials. The connection strengthens the Committee's ability to add value.

5. Refresh the Committee's Focus Annually

Annual review of the Committee's own operating rhythm, its materials, its cadence, and its engagement with the CSR programme keeps the Committee learning and evolving. Committees that stay static tend to weaken across the years even when composition remains strong.

A Note on Setting Up a Committee for the First Time

For companies that have just crossed the CSR applicability thresholds and are setting up a Committee for the first time, several practical considerations help the setup go well.

Start with the statutory requirements confirmed. The Board should have Company Secretary and Legal advice confirming the applicability of Section 135, the specific composition requirement, and any specific provisions that apply to the company's category
Choose members thoughtfully. Beyond meeting the composition requirement, the members chosen should have the interest and availability to engage with CSR substantively. This choice shapes the Committee's character for years
Draft the CSR Policy carefully. The first CSR Policy will be revisited annually, but it sets the direction. A thoughtful Policy, connected to the company's identity and sector, produces stronger downstream work than a generic Policy
Establish the meeting rhythm from the start. A quarterly cadence set at the first meeting is easier to maintain than a rhythm attempted later
Connect early to the operational side. The Committee should meet the CSR team and hear from potential implementing partners early, so its first year of work is grounded in operational reality rather than in abstraction

A Note on Restructuring an Existing Committee

For companies with an existing Committee that has become weak, the following steps often help.

Review whether the composition still serves the company's current CSR programme and, where the Board judges it useful, refresh the membership
Establish a stronger meeting cadence, moving from once-a-year to quarterly if that is the current pattern
Rebuild the materials package that supports Committee meetings, drawing on richer input from the CSR team, CFO, and implementing partners
Re-engage the independent director in genuine governance discussion
Connect the Committee to the broader CSR compliance framework, ensuring information flows from Company Secretary, Chartered Accountant, statutory auditor, and BRSR reporting where applicable

A Note on the Limits of This Article

This article provides operational guidance on setting up a CSR Committee based on the requirements of Section 135 of the Companies Act 2013 and the Companies (CSR Policy) Rules 2014 as understood as of April 2026. It is informational guidance and does not constitute legal, financial, or compliance advice.

The specific composition requirements, thresholds, and Committee provisions are subject to amendment by the Ministry of Corporate Affairs, and specific facts of each company (size, listing status, private or public status, category under Section 149) affect the application of the framework. Every Committee structure and operational decision should be reviewed by the company's Company Secretary, Chartered Accountant, statutory auditor, and Legal counsel.

Verify against the current text of Section 135 of the Companies Act 2013, the Companies (CSR Policy) Rules 2014, Section 149 on independent directors, Section 134 on the Board's Report, and any recent MCA circulars before finalising the Committee. The guidance in this article is a starting reference, not a definitive setup manual, and should be adapted to each company's specific facts with professional review.

What This Article Is Actually Saying

Three things are worth holding onto.

1. A CSR Committee is a governance body, not a formality. Set up thoughtfully and run with discipline, the Committee produces significantly stronger CSR than one that exists only to satisfy the statutory requirement.

2. The composition matters, and so does what happens between meetings. The statutory minimum on independent director representation is a floor, not a ceiling. The strongest Committees combine sound composition with quarterly meeting discipline, strong materials, genuine use of the independent director's voice, and connection to the operational CSR programme.

3. The Committee sits within a broader framework. The Company Secretary, the Chartered Accountant, the statutory auditor, the CSR team, the implementing agencies, and where applicable BRSR reporting all connect to the Committee's work. A Committee well-supported by these connections adds substantially more value than one that operates in isolation.

The companies that produce the strongest CSR outcomes tend to be those whose CSR Committees are treated as substantive governance bodies from the start. The compounding effect across years is considerable, both for CSR outcomes and for the company's broader compliance and stakeholder posture.

Working With Marpu Foundation Downstream of Your Committee's Decisions

At Marpu Foundation, we operate as an implementation partner across our network of 250+ corporate partnerships and 23+ Indian states. Our role sits downstream of the CSR Committee's decisions, delivering the programmes the Committee approves and providing the operational discipline that supports the Committee's oversight.

For CSR Committees making implementation partner decisions for FY 2026-27 and beyond, the ways we support the Committee's oversight function include the following:

Programme design input: Contributing programme design that the CSR Committee reviews and approves, aligned to the Committee's chosen focus areas and geographies
Schedule VII alignment: Documenting the Schedule VII clause each project aligns with, so the Committee's programme approvals are grounded in clear regulatory alignment
Continuous reporting: Providing programme progress reports at the cadence the Committee sets, supporting quarterly review rather than annual assembly
Documentation discipline: Maintaining the activity-level, financial, and Utilization Certificate documentation that supports the Committee's oversight, the statutory audit, the Board's Report drafting, and where applicable BRSR Principle 8 disclosure
Governance-friendly working style: Supporting the Committee's own governance rhythm through timely responses to Committee questions, clear communication, and honest reporting on programme progress including where challenges emerge

We hold current CSR-1 registration, 12A registration, and 80G registration, and our documentation supports corporate partners' Committee oversight across the annual cycle.

For CSR Committees considering implementation partners for the coming financial year, Marpu Foundation would be glad to be evaluated alongside other candidates the Committee is considering. Write to connect@marpu.org or visit marpu.org. Send a brief note on your focus areas, your geographies, your sectors, and your Committee's decision timeline, and we respond within two working days with our registration documentation, project portfolio references, and a programme proposal aligned to your Committee's priorities.

For companies setting up or restructuring a CSR Committee with any implementation approach, the guidance above is the working reference. Confirm the applicability with Company Secretary and Legal counsel, choose Committee members thoughtfully, establish a quarterly meeting cadence, invest in strong materials, use the independent director's voice genuinely, and connect the Committee to the operational CSR programme. The Committee that engages substantively is the Committee that produces the CSR the company can be proud of.