MCA Prescribes Implementation Framework for CSR Investments Through Social Stock Exchange Instruments

The Ministry of Corporate Affairs (“MCA”) has amended the Companies (Corporate Social Responsibility Policy) Rules, 2014 by inserting Rule 4(7), prescribing the implementation framework for CSR expenditure undertaken through subscription to Zero Coupon Zero Principal (“ZCZP”) Instruments issued by Not-for-Profit Organisations (“NPOs”) listed on a Social Stock Exchange. ¹³

Under the amended framework, the NPO receiving the CSR funds must utilise the proceeds for a project having a duration of not more than three succeeding financial years from the date of issuance of the instrument. Further, upon delisting or termination of the instrument, any unspent amount must be transferred to a fund specified under Schedule VII of the Companies Act, 2013 and a compliance report must be submitted to SEBI.

The amendment complements the recent expansion of Schedule VII by establishing operational safeguards and accountability mechanisms for CSR investments routed through the Social Stock Exchange.

Conclusion

The amendment introduces a structured compliance framework for CSR investments through Social Stock Exchange instruments and seeks to ensure transparency, accountability, and effective utilisation of CSR funds.

Last Updated on 24 June, 2026