CSR projects in community disaster resilience
How corporate social responsibility money can fund disaster management in India, and what makes a project last beyond its first monsoon.
A company in an industrial district has set aside its annual CSR budget, and a nearby village sits on a river that floods every few monsoons. Can that money legitimately go into disaster preparedness, and if so, what should it buy? The role of CSR in disaster management is often reduced to relief camps after the water has already come. The law allows much more, and the projects that protect people best are usually the ones built before the event. This article explains what the Companies Act permits, how a CSR project in community disaster resilience is typically structured, and where such projects tend to fail.
What does the law say about CSR in disaster management?
Corporate social responsibility in disaster management is permitted because Schedule VII of the Companies Act, 2013 lists "disaster management, including relief, rehabilitation and reconstruction activities" as item (xii). The Ministry of Corporate Affairs inserted it by a notification dated 30 May 2019 [2].
The wider rules are these:
- Who must spend. A company with a net worth of ₹500 crore or more, turnover of ₹1,000 crore or more, or net profit of ₹5 crore or more in any financial year must form a CSR committee of its board [1].
- How much. The board must ensure the company spends at least 2 % of its average net profit of the three preceding financial years on Schedule VII activities [1][3].
- Who decides. CSR is board-driven: the board plans, decides, executes and monitors the activities. A company may act itself or through implementing agencies. Since 1 April 2021 these agencies must be registered with the Ministry [3][4].
- Local preference. The Act asks companies to give preference to the local areas around where they operate [8].
- Evaluation. A company with an average CSR obligation of ₹10 crore or more over the three preceding years must have projects of ₹1 crore or more evaluated by an independent agency, once they have been complete for at least a year [3].
Schedule VII has been amended more than once, most recently in May 2026, when item (xiii) was added [5]. The current text of the Act and Rules should always be checked before a project is approved. The Ministry's own data show about ₹34,909 crore of development CSR expenditure in FY 2023-24 [3], so the funding stream is large. The CSR legal framework has no provision for allocating CSR funds [3], which means disaster resilience competes for a board's attention with every other item.
Why fund preparedness and not only relief?
India's own disaster plan asks for it. The National Disaster Management Plan, 2019 says there is a need to involve the private sector in disaster management and lists technical support, reconstruction effort, risk management and financial support among the areas [6]. It also calls for reconstruction plans to be drawn up with the affected community, NGOs and the corporate sector [6].
The case for acting before the event is simple. In its 2022 report, WMO and UNDRR noted that countries with limited early warning coverage have disaster mortality eight times higher than those with broader coverage [7]. A village that receives a warning in time can move people and cattle. A village that does not will need relief later.
What kinds of CSR projects build community disaster resilience?
A CSR project in community disaster resilience usually combines several of these:
- Monitoring. River level, rainfall or surface velocity sensors upstream of the village. See how a flood early warning system works.
- Warning dissemination. Sirens, voice messages, SMS and a local volunteer chain, designed so that every household can hear or read a warning. See early warning dissemination: sirens, SMS and CAP.
- Preparedness. Evacuation maps, safe-route signs, first-aid and rescue kits, and training of local volunteers.
- Drills. Rehearsals that test the whole chain. See running a community flood drill with sirens.
- Recovery support. Rehabilitation and reconstruction after an event, which Schedule VII item (xii) also covers [2].
How should a company plan such a project?
Good projects are designed for years, not for an inauguration photograph. Four questions decide whether a warning system still works in its third monsoon.
1. Who will run it? Equipment needs an owner. The project should name the gram panchayat, the district disaster management authority or a registered implementing agency, and write the handover into the agreement. The district and state authorities issue official warnings, so a community system should connect to them, not compete with them. Our post on who issues warnings in India explains the roles.
2. Who pays for operation? A siren needs a working battery and a tested link. A sensor needs cleaning and a datum check after the monsoon. If the budget covers only purchase and installation, the system degrades. See the total cost of a monitoring network and siren testing and maintenance.
3. How will it be measured? Count outcomes that matter: households reached in a drill, time from alert to siren, tests completed, faults repaired. Avoid counting only units installed.
4. Does the village have a say? NDMP 2019 stresses participation of the affected community [6]. Siren locations, tones and messages should be agreed with the people who will hear them.
An illustrative budget
The figures below are illustrative arithmetic, not a real project. A company with an average net profit of ₹60 crore has a CSR obligation of 2 % × ₹60 crore = ₹1.2 crore a year. The board decides to commit one-quarter of that, ₹0.3 crore, to a flood-warning project for five villages along one stream, spread over three years:
In this split, 25 % goes to operation and maintenance and 15 % to training and drills. That is deliberate: the money that keeps a system alive is as important as the equipment.
What goes wrong, and how do projects avoid it?
| Common problem | Why it happens | Better practice |
|---|---|---|
| Equipment installed, then unused | No owner or operating budget after handover | Name the owner and fund operation for several years |
| Warnings nobody trusts | False alerts, or no link to official sources | Agree thresholds with the district authority and test the chain |
| Only the nearby village is covered | Preference for the company's local area leaves out upstream or downstream settlements | Design around the river, then fund the villages that the river puts at risk |
| One-off relief spending | Easier to approve and announce | Pair relief with a preparedness line in the annual plan |
| Impact unknown | No baseline or indicators | Set indicators at the start and review them every monsoon |
Key points
- Schedule VII item (xii) of the Companies Act, 2013 allows CSR spending on disaster management, including relief, rehabilitation and reconstruction [2].
- Qualifying companies must spend at least 2 % of average net profit on Schedule VII activities, through the company or registered implementing agencies [1][3][4].
- The National Disaster Management Plan, 2019 asks for private sector involvement, and early warning coverage is linked to lower disaster mortality [6][7].
- Name the owner, fund operation and maintenance, test the warning chain and include the community.
- Check the current Schedule VII and Rules before approving a project.
Where ClimMaTech fits
At ClimMaTech we build the equipment and software that a flood-warning project of this kind needs. RAKSHAK is a multi-hazard warning siren with a built-in library of 15-20 user-selectable siren tones and voice messages for floods, other disasters and civil defence (air-raid) warnings, and our flood warning page describes how monitoring, alerts and sirens fit together for a river community.
References
- Government of Uttarakhand, CSR portal, Statutory requirement: Section 135 of the Companies Act, 2013 (net worth, turnover and net profit thresholds; 2 % of average net profit; local-area preference). csr.uk.gov.in. The thresholds are also quoted at the Government of Odisha CSR portal: csr.odisha.gov.in
- Companies Act, 2013, Schedule VII (see section 135), item (xii), inserted by Ministry of Corporate Affairs notification dated 30 May 2019 (text as reproduced, with the notification link, at ca2013.com)
- Press Information Bureau, Ministry of Corporate Affairs, Annual filings by companies on development CSR expenditure totals over 1,44,159 crores in last five FYs (2019-20 to 2023-24), 10 February 2026. pib.gov.in
- Press Information Bureau, Ministry of Corporate Affairs, 17,130 Implementing Agencies are registered with MCA21 registry, 29 November 2021. pib.gov.in
- Press Information Bureau, Ministry of Corporate Affairs, MCA facilitates Corporate Social Responsibility (CSR) through Zero Coupon Zero Principal Instrument by expanding the scope of Schedule VII of the Companies Act, 2013, 29 May 2026. pib.gov.in
- National Disaster Management Authority, National Disaster Management Plan, 2019 (revised edition, November 2019), sections 9.2.1 and 9.6.3. ndma.gov.in
- World Meteorological Organization, UN warns that half the world is not prepared for disasters, 13 October 2022. wmo.int
- Press Information Bureau, Ministry of Steel, Funds in Corporate Social Responsibility, 23 March 2022 (first proviso to section 135(5): preference to local areas). pib.gov.in