{"id":25649057,"date":"2026-06-04T15:44:04","date_gmt":"2026-06-04T10:14:04","guid":{"rendered":"https:\/\/entri.app\/blog\/?p=25649057"},"modified":"2026-06-04T15:44:04","modified_gmt":"2026-06-04T10:14:04","slug":"what-is-corporate-social-responsibility-csr","status":"publish","type":"post","link":"https:\/\/entri.app\/blog\/what-is-corporate-social-responsibility-csr\/","title":{"rendered":"What is Corporate Social Responsibility (CSR)? How Does it Work?"},"content":{"rendered":"<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_79_2 counter-hierarchy ez-toc-counter ez-toc-custom ez-toc-container-direction\">\n<p class=\"ez-toc-title\" style=\"cursor:inherit\">Table of Contents<\/p>\n<label for=\"ez-toc-cssicon-toggle-item-6a2172d5a41d6\" class=\"ez-toc-cssicon-toggle-label\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #999;color:#999\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #999;color:#999\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/label><input type=\"checkbox\"  id=\"ez-toc-cssicon-toggle-item-6a2172d5a41d6\"  aria-label=\"Toggle\" \/><nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/entri.app\/blog\/what-is-corporate-social-responsibility-csr\/#Key_Takeaways\" >Key Takeaways<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/entri.app\/blog\/what-is-corporate-social-responsibility-csr\/#More_about_Corporate_Social_Responsibility\" >More about Corporate Social Responsibility<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/entri.app\/blog\/what-is-corporate-social-responsibility-csr\/#The_Four_Areas_of_CSR\" >The Four Areas of CSR<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-4\" href=\"https:\/\/entri.app\/blog\/what-is-corporate-social-responsibility-csr\/#How_Corporate_Social_Responsibility_Works_in_India\" >How Corporate Social Responsibility Works in India<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-5\" href=\"https:\/\/entri.app\/blog\/what-is-corporate-social-responsibility-csr\/#What_can_Companies_Spend_the_Money_on\" >What can Companies Spend the Money on?<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-6\" href=\"https:\/\/entri.app\/blog\/what-is-corporate-social-responsibility-csr\/#Top_3_Benefits_of_CSR_for_Companies\" >Top 3 Benefits of CSR for Companies<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-7\" href=\"https:\/\/entri.app\/blog\/what-is-corporate-social-responsibility-csr\/#Conclusion\" >Conclusion<\/a><\/li><\/ul><\/nav><\/div>\n<p>Imagine that there\u2019s a popular food stall in your neighbourhood. As part of running the business, that food stall uses local water, buys vegetables from local vendors, and sells food to people living in the nearby areas. However, what if this stall throws its trash right on the street? It is quite natural that neighbours will get angry and stop eating there. On the other hand, if the owner uses a little bit of their profit to clean up the street and put up streetlights, everyone will love them and buy more food.<\/p>\n<p>This is the basic idea behind <strong>corporate social responsibility<\/strong>.<\/p>\n<p>For a long time, corporations or businesses were bothered only about making money. However, today, things have changed a lot. Big companies use a lot of public resources such as water, electricity, and roads. Due to the fact that they use so much of public resources, they should give something back to the community. Let&#8217;s look at how this works in India.<\/p>\n<p style=\"text-align: center;\"><a href=\"https:\/\/entri.app\/course\/personal-finance-course-in-kerala\/\" target=\"_blank\" rel=\"noopener\"><b>Ace your personal finance journey with Entri&#8217;s Personal Finance Online Course. Join Now!<\/b><\/a><\/p>\n<h2><span class=\"ez-toc-section\" id=\"Key_Takeaways\"><\/span><strong>Key Takeaways<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n<ul>\n<li><strong>Simple Meaning:<\/strong> It means companies doing good things for people and the planet, instead of just counting their profits.<\/li>\n<li><strong>India is a Leader:<\/strong> India was the very first country to pass a law making this helpful spending mandatory for big companies.<\/li>\n<li><strong>The Rule Of 2%:<\/strong> Big, successful companies must spend 2% of their average profits on helping society.<\/li>\n<li><strong>Areas to be Spent:<\/strong> It builds free schools, helps rural clinics, plants trees, and provides clean drinking water.<\/li>\n<li><strong>How It Matters:<\/strong> Communities get real help, and companies get love, trust, and happier customers.<\/li>\n<\/ul>\n<h2><span class=\"ez-toc-section\" id=\"More_about_Corporate_Social_Responsibility\"><\/span><strong>More about Corporate Social Responsibility<\/strong><img loading=\"lazy\" decoding=\"async\" class=\"aligncenter wp-image-25649061 \" src=\"https:\/\/entri.app\/blog\/wp-content\/uploads\/2026\/06\/233879.webp\" alt=\"Corporate Social Responsibility\" width=\"601\" height=\"254\" srcset=\"https:\/\/entri.app\/blog\/wp-content\/uploads\/2026\/06\/233879.webp 1500w, https:\/\/entri.app\/blog\/wp-content\/uploads\/2026\/06\/233879-300x127.webp 300w, https:\/\/entri.app\/blog\/wp-content\/uploads\/2026\/06\/233879-1024x432.webp 1024w, https:\/\/entri.app\/blog\/wp-content\/uploads\/2026\/06\/233879-768x324.webp 768w, https:\/\/entri.app\/blog\/wp-content\/uploads\/2026\/06\/233879-150x63.webp 150w, https:\/\/entri.app\/blog\/wp-content\/uploads\/2026\/06\/233879-750x317.webp 750w, https:\/\/entri.app\/blog\/wp-content\/uploads\/2026\/06\/233879-1140x481.webp 1140w\" sizes=\"auto, (max-width: 601px) 100vw, 601px\" \/><span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>In simple words, <strong>corporate social responsibility<\/strong> (CSR) is a plan where companies take care of the world around them. To keep it simple, it is a promise that a company will not harm society just to make a quick profit. Instead of aiming only at profits, they focus on three things and they are <strong>People, Planet, and Profit.<\/strong><\/p>\n<p>In India, this isn&#8217;t a new idea. For generations, business families gave money to temples or handed out blankets to the poor. But today, it is much more organized. It is no longer about just giving random charity. It is about fixing real, long-term problems like lack of education or dirty water.<\/p>\n<h2><span class=\"ez-toc-section\" id=\"The_Four_Areas_of_CSR\"><\/span><strong>The Four Areas of CSR<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p><img loading=\"lazy\" decoding=\"async\" class=\"aligncenter wp-image-25649060 \" src=\"https:\/\/entri.app\/blog\/wp-content\/uploads\/2026\/06\/13442225_5226252-e1780567108938.webp\" alt=\"Corporate Social Responsibility\" width=\"451\" height=\"428\" srcset=\"https:\/\/entri.app\/blog\/wp-content\/uploads\/2026\/06\/13442225_5226252-e1780567108938.webp 2000w, https:\/\/entri.app\/blog\/wp-content\/uploads\/2026\/06\/13442225_5226252-e1780567108938-300x285.webp 300w, https:\/\/entri.app\/blog\/wp-content\/uploads\/2026\/06\/13442225_5226252-e1780567108938-1024x971.webp 1024w, https:\/\/entri.app\/blog\/wp-content\/uploads\/2026\/06\/13442225_5226252-e1780567108938-768x728.webp 768w, https:\/\/entri.app\/blog\/wp-content\/uploads\/2026\/06\/13442225_5226252-e1780567108938-1536x1457.webp 1536w, https:\/\/entri.app\/blog\/wp-content\/uploads\/2026\/06\/13442225_5226252-e1780567108938-24x24.webp 24w, https:\/\/entri.app\/blog\/wp-content\/uploads\/2026\/06\/13442225_5226252-e1780567108938-150x142.webp 150w, https:\/\/entri.app\/blog\/wp-content\/uploads\/2026\/06\/13442225_5226252-e1780567108938-750x711.webp 750w, https:\/\/entri.app\/blog\/wp-content\/uploads\/2026\/06\/13442225_5226252-e1780567108938-1140x1081.webp 1140w\" sizes=\"auto, (max-width: 451px) 100vw, 451px\" \/><\/p>\n<p>When companies design their helpful projects, they usually focus on four main areas:<\/p>\n<h3><strong>1. Taking Care of Nature<\/strong><\/h3>\n<p>Companies try to cut down the damage they cause to the environment. Some relatable examples include activities like using solar energy, planting trees, stopping the use of plastic, and recycling water.<\/p>\n<h3><strong>2. Being Fair and Honest<\/strong><\/h3>\n<p>This means treating everyone with respect and this includes paying workers fairly, refusing to buy from factories that use child labour, and being completely honest with customers.<\/p>\n<h3><strong>3. Giving Donations<\/strong><\/h3>\n<p>This is straightforward charity. Companies use their money to build public assets like hospitals, colleges, or libraries that anyone can use for free.<\/p>\n<h3><strong>4. Smart Business Choices<\/strong><\/h3>\n<p>This ties everything together. It means a company chooses to do the right thing even if it costs a bit more money. An example is buying an expensive machine that does not pollute the air, instead of relying on a cheap one that emits toxic smoke.<\/p>\n<div class=\"lead-gen-block\"><a href=\"https:\/\/entri.app\/blog\/wp-content\/uploads\/2026\/04\/Program-in-Indian-Stock-Market-and-Forex-Trading-1-compressed.pdf\" data-url=\"https:\/\/entri.app\/blog\/wp-content\/uploads\/2026\/04\/Program-in-Indian-Stock-Market-and-Forex-Trading-1-compressed.pdf\" class=\"lead-pdf-download\" data-id=\"25556854\">\n<p style=\"text-align: center;\"><button class=\"btn btn-default\">free download Stock market course roadmap<\/button><\/p>\n<\/a><\/div>\n<h2><span class=\"ez-toc-section\" id=\"How_Corporate_Social_Responsibility_Works_in_India\"><\/span><strong>How Corporate Social Responsibility Works in India<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>While doing good is optional in most countries, India made it a strict rule. The Government of India, in 2013, passed a law making <strong>corporate social responsibility<\/strong> mandatory for large businesses. Believe it or not, the amount of money spent on CSR initiatives now stands at around Rs.40,000 crore.<\/p>\n<p>Here is how the law works:<\/p>\n<h3><strong>Which Companies Have to Pay?<\/strong><\/h3>\n<p>Small shops or struggling new start-ups do not have to pay this. The rule is only for big, highly profitable companies that meet any of these conditions:<\/p>\n<ol>\n<li>They are worth \u20b9500 crore or more.<\/li>\n<li>Their total sales reach \u20b91,000 crore or more.<\/li>\n<li>Their yearly net profit is \u20b95 crore or more.<\/li>\n<\/ol>\n<h3><strong>The 2% Math<\/strong><\/h3>\n<p>If a company fits the description above, it must calculate its average net profit from the last three years. Then, it has to spend <strong>at least 2%<\/strong> of that average amount on social welfare projects every year. HDFC Bank and Reliance Industries were the top CSR contributors in India in FY24.<\/p>\n<h2><span class=\"ez-toc-section\" id=\"What_can_Companies_Spend_the_Money_on\"><\/span><strong>What can Companies Spend the Money on?<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p><img loading=\"lazy\" decoding=\"async\" class=\"aligncenter wp-image-25649064 \" src=\"https:\/\/entri.app\/blog\/wp-content\/uploads\/2026\/06\/2150196689.webp\" alt=\"Corporate Social Responsibility\" width=\"508\" height=\"339\" srcset=\"https:\/\/entri.app\/blog\/wp-content\/uploads\/2026\/06\/2150196689.webp 1500w, https:\/\/entri.app\/blog\/wp-content\/uploads\/2026\/06\/2150196689-300x200.webp 300w, https:\/\/entri.app\/blog\/wp-content\/uploads\/2026\/06\/2150196689-1024x683.webp 1024w, https:\/\/entri.app\/blog\/wp-content\/uploads\/2026\/06\/2150196689-768x512.webp 768w, https:\/\/entri.app\/blog\/wp-content\/uploads\/2026\/06\/2150196689-150x100.webp 150w, https:\/\/entri.app\/blog\/wp-content\/uploads\/2026\/06\/2150196689-750x500.webp 750w, https:\/\/entri.app\/blog\/wp-content\/uploads\/2026\/06\/2150196689-1140x760.webp 1140w\" sizes=\"auto, (max-width: 508px) 100vw, 508px\" \/><\/p>\n<p>Companies cannot spend this money on whatever they want. For example, a company cannot throw a luxury party for its managers and call it charity. The government has a specific list of approved activities.<\/p>\n<p>Some of the most common ways companies use their CSR money in India are:<\/p>\n<ul>\n<li><strong>Fighting Hunger and Poverty:<\/strong> Feeding poor families and giving nutritious food to undernourished children.<\/li>\n<li><strong>Better Healthcare:<\/strong> Setting up free medical camps, donating ambulances, and providing clean drinking water to villages. ICICI Bank donated Rs.625 crore in 2025 October as part of its CSR activity to construct a new cancer care building at Tata Memorial Centre\u2019s (TMC) Advanced Centre for Treatment, Research and Education in Cancer (ACTREC). It will be one of India\u2019s largest radiation therapy centres.<\/li>\n<li><strong>Schooling and Education:<\/strong> Fixing broken government schools, buying computers for students, and supporting girls who want to study.<\/li>\n<li><strong>Helping Women:<\/strong> Giving skill training to women so they can start small businesses and earn their own money.<\/li>\n<li><strong>Saving Nature:<\/strong> Cleaning up dirty rivers, protecting wild animals, and planting forests.<\/li>\n<li><strong>Disaster Relief:<\/strong> Giving money directly to emergency funds (like the PM CARES fund) to help people during floods, earthquakes, or medical crises.<\/li>\n<\/ul>\n<p>In FY 25, the CSR spending by companies listed on stock exchanges rose by 23%. In the previous year, i.e. FY 24, the surge in CSR spending was 16%.<\/p>\n<h2><span class=\"ez-toc-section\" id=\"Top_3_Benefits_of_CSR_for_Companies\"><\/span><strong>Top 3 Benefits of CSR for Companies<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p><img loading=\"lazy\" decoding=\"async\" class=\"aligncenter wp-image-25649065 \" src=\"https:\/\/entri.app\/blog\/wp-content\/uploads\/2026\/06\/13442179_5246622-scaled-e1780567229967.webp\" alt=\"Corporate Social Responsibility\" width=\"422\" height=\"252\" srcset=\"https:\/\/entri.app\/blog\/wp-content\/uploads\/2026\/06\/13442179_5246622-scaled-e1780567229967.webp 2560w, https:\/\/entri.app\/blog\/wp-content\/uploads\/2026\/06\/13442179_5246622-scaled-e1780567229967-300x179.webp 300w, https:\/\/entri.app\/blog\/wp-content\/uploads\/2026\/06\/13442179_5246622-scaled-e1780567229967-1024x611.webp 1024w, https:\/\/entri.app\/blog\/wp-content\/uploads\/2026\/06\/13442179_5246622-scaled-e1780567229967-768x458.webp 768w, https:\/\/entri.app\/blog\/wp-content\/uploads\/2026\/06\/13442179_5246622-scaled-e1780567229967-1536x916.webp 1536w, https:\/\/entri.app\/blog\/wp-content\/uploads\/2026\/06\/13442179_5246622-scaled-e1780567229967-2048x1222.webp 2048w, https:\/\/entri.app\/blog\/wp-content\/uploads\/2026\/06\/13442179_5246622-scaled-e1780567229967-150x89.webp 150w, https:\/\/entri.app\/blog\/wp-content\/uploads\/2026\/06\/13442179_5246622-scaled-e1780567229967-750x447.webp 750w, https:\/\/entri.app\/blog\/wp-content\/uploads\/2026\/06\/13442179_5246622-scaled-e1780567229967-1140x680.webp 1140w\" sizes=\"auto, (max-width: 422px) 100vw, 422px\" \/><\/p>\n<p>You might think companies hate spending this money, but they actually love it. Here is why:<\/p>\n<h3><strong>1. It Builds Strong Reputation<\/strong><\/h3>\n<p>Consumers in India generally prefer to purchase from brands they trust. When a company helps build a village or a school, people easily associate with it. This good reputation acts as a saviour for the brand in case they make a mistake in the future.<\/p>\n<h3><strong>2. It Attracts Good Workers<\/strong><\/h3>\n<p>It is not that young professionals work just for the sake of getting a salary. On the other hand, they want to feel proud of the organisation with which they work. Companies with great social programs easily hire the smartest young minds.<\/p>\n<h3><strong>3. It Pleases Investors<\/strong><\/h3>\n<p>People who invest big money into companies prefer safe businesses. A company that takes care of its environment and local people face fewer protests and less legal trouble, making it a safe choice for investors.<\/p>\n<p>The latest news is that the Ministry of Corporate Affairs (MCA) now allows companies to spend up to 10% of annual CSR budget on Zero Coupon Zero Principal (ZCZP) instruments listed on Social Stock Exchanges.<\/p>\n<p style=\"text-align: center;\"><a href=\"https:\/\/entri.app\/course\/personal-finance-course-in-kerala\/\" target=\"_blank\" rel=\"noopener\"><b>Ace your personal finance journey with Entri&#8217;s Personal Finance Online Course. Join Now!<\/b><\/a><\/p>\n<h2><span class=\"ez-toc-section\" id=\"Conclusion\"><\/span><strong>Conclusion<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p><strong>Corporate social responsibility<\/strong> is no longer just a marketing gimmick to create a good impression on television. On the other hand, it has become a powerful way in India to develop the country. By collecting money from big corporate profits and spending it on grassroots problems, it helps everyone grow together. To keep it simple, CSR is proof that businesses can make great money while making the world a better place.<\/p>\n<div class=\"alert alert-warning\"><strong>Disclaimer:<\/strong>\u00a0The information provided in this article is for general informational purposes only and is not intended as investment advice, financial guidance, or an offer or solicitation to buy or sell any securities. Readers should conduct their own research or consult a qualified financial advisor before making any investment decisions. The author(s) and the publisher disclaim any liability for any loss or damage arising directly or indirectly from the use of or reliance on the information provided herein.<\/div>\n<table>\n<tbody>\n<tr>\n<td colspan=\"2\">\n<p style=\"text-align: center;\"><b>RELATED POSTS<\/b><\/p>\n<\/td>\n<\/tr>\n<tr>\n<td style=\"text-align: center;\"><a href=\"https:\/\/entri.app\/blog\/ultimate-guide-to-personal-finance-in-india\/\" target=\"_blank\" rel=\"noopener\"><b>The Ultimate Guide to Personal Finance in India\u00a0<\/b><\/a><\/td>\n<td>\n<p style=\"text-align: center;\"><a href=\"https:\/\/entri.app\/blog\/ultimate-guide-to-personal-finance-in-india\/\" target=\"_blank\" rel=\"noopener\"><b>The Ultimate Guide to Personal Finance in India\u00a0<\/b><\/a><\/p>\n<\/td>\n<\/tr>\n<tr>\n<td>\n<p style=\"text-align: center;\"><a href=\"https:\/\/entri.app\/blog\/your-take-home-salary-under-new-labour-laws\/\" target=\"_blank\" rel=\"noopener\"><b>Your Take Home Salary Under New Labour 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