CSR must inherently include environmental responsibility: Supreme Court
New Delhi, Dec 20, 2025
Synopsis
The Supreme Court has linked corporate social responsibility with environmental protection. Companies must now consider the environment and other living beings. Funds for corporate social responsibility are seen as a fulfillment of constitutional duty. The court issued directions to protect the Great Indian Bustard. Non-renewable power generators must operate with consideration for the endangered species' habitat.
In a significant ruling, the Supreme Court has said that corporate social responsibility cannot be separated from corporate environmental responsibility and companies cannot claim to be socially responsible while ignoring equal claims of the environment and other beings of the ecosystem.
A bench of Justices PS Narasimha and AS Chandurkar passed a slew of directions to protect the Great Indian Bustard, a species which is on the verge of extinction and faces threat from the operation of non-renewable power generators in Rajasthan and Gujarat.
"Therefore, the corporate definition of 'social responsibility' must inherently include environmental responsibility. Companies cannot assert to be socially responsible while ignoring equal claims of the environment and other beings of the ecosystem," the bench said.
It added that the Constitution of India, under Article 51A(g), imposes a fundamental duty on every citizen "to protect and improve the natural environment, including forests, lakes, rivers and wildlife, and to have compassion for living creatures."
"A corporation, as a legal person and a key organ of society, shares this fundamental duty. CSR funds are the tangible expression of this duty. Consequently, allocating funds for the protection of the environment is not a voluntary act of charity but a fulfilment of a constitutional obligation," the top court said.
The bench said under Section 135 of the Companies Act, 2013, Parliament institutionalised this duty by mandating companies to meet specific financial thresholds espousing social responsibility.
[The Economic Times]
