Setting Up a Corporate Foundation In the Context of CSR
What Is a Corporate Foundation? A corporate foundation is a dedicated non-profit entity established by a company to plan, fund, and manage its Corporate Social Responsibility (CSR) activities in a structured and sustainable manner. Rather than routing CSR funds through external non-governmental organisations (NGOs) on a project-by-project basis, a corporate foundation gives the company a permanent institutional vehicle to own and drive its social impact agenda. In India, the obligation to spend on CSR arises under Section 135 of the Companies Act, 2013, which mandates that companies meeting prescribed thresholds of net worth, turnover, or net profit must spend at least 2% of their average net profits of the preceding three financial years on eligible Schedule VII activities. A corporate foundation is one of the recognised modes of implementation under these rules — either as the implementing entity itself or as a channel that further sub-grants to other registered non-profits. Un...