Corporate Social Responsibility (CSR) has emerged as a powerful mechanism for driving social change. It allows companies to contribute meaningfully to society while funding crucial development projects in areas such as education, healthcare, rural infrastructure, and more.
While corporate philanthropy has long existed in India, CSR has formalized the process. Under the Companies Act, it is now mandatory for eligible businesses to allocate a portion of their profits towards social development initiatives. This framework ensures consistency, accountability, and broader impact.
One of CSR’s most significant contributions is that it has created opportunities for grassroots NGOs to access funding. These small but impactful organisations are now able to scale their work through partnerships with corporations. On the other side, companies benefit by engaging with trusted organisations that are deeply rooted in communities and equipped to implement effective programmes.
This ecosystem of strategic CSR partnerships ensures that social initiatives are implemented efficiently while also contributing to long-term business value.
What Is CSR?
The full form of CSR is Corporate Social Responsibility. As defined by the United Nations Industrial Development Organization (UNIDO), CSR is “a management concept whereby companies integrate social and environmental concerns in their business operations and interactions with stakeholders.”
In simpler terms, it refers to a company’s commitment to balancing economic, environmental, and social goals—also known as the Triple Bottom Line approach.
While the concept of CSR began evolving in the 1950s and 60s, it gained momentum globally in the 1990s and 2000s. According to a 2017 KPMG survey, only 35% of the world’s largest 250 companies were reporting their CSR efforts in 1999. This number grew to 45% in 2002, 64% in 2005, and over 80% by 2008. From 2011 onwards, over 90% of these companies consistently report their CSR work.
CSR in India: A Legal Mandate
India became the first country in the world to mandate CSR through the Companies Act, 2013. The law requires qualifying companies to spend 2% of their average net profit on CSR activities each financial year.
Since this mandate came into effect, the impact has been remarkable. In FY 2020–21, over 18,000 Indian companies collectively spent more than ₹25,000 crore on CSR projects across 14 focus areas, including rural development, education, health, environment, and more.
For businesses, CSR is not just about compliance. It is about giving back to the community they operate in and contributing to the social fabric that supports their success.
The Role of Partnerships in CSR Success
Effective CSR implementation depends heavily on collaborations with the right partners—be it NGOs, government bodies, or community-based organisations. While corporates may have the funds, they often lack the on-ground expertise to carry out large-scale development initiatives.
This is where partnerships become vital. For example, a company based in Mumbai can support flood relief efforts in rural Assam by partnering with a local NGO that understands the region’s specific needs. Similarly, CSR funds can support government programmes to amplify impact—such as during the COVID-19 pandemic, when several companies contributed to national healthcare and relief efforts.
When partnerships are aligned in purpose and values, the outcome is more impactful and far-reaching.
Moving Beyond CSR: Strengthening Implementation
However, selecting the right partner is key. Corporates must conduct thorough due diligence to ensure that the funds they allocate are used transparently and effectively. Long-term partnerships, rather than short-term funding cycles, help drive deeper, more sustainable impact.
Organisations receiving CSR funds must also maintain ongoing communication and collaboration, aligning their goals and operations with corporate expectations. Meanwhile, companies should build robust monitoring and evaluation (M&E) systems to track progress and measure outcomes.
As India’s corporate sector grows, so will its CSR contributions—unlocking the potential for transformational change. But this will only be possible if the funds are deployed efficiently through meaningful partnerships.
The Way Forward
CSR is more than compliance—it is a pathway to social equity, shared growth, and inclusive development. When companies collaborate with the right partners, they help create a society that is stronger, fairer, and better equipped for the future.
Partnering for Impact: A Call to Action
At Smile Foundation, we believe in building a more equitable world for all children. Since our inception, we’ve worked alongside corporations to drive impact through CSR—particularly for children and communities from low-income backgrounds.
We invite like-minded organisations to join us in creating lasting change through strategic CSR partnerships.
