CORPORATE SOCIAL RESPONSIBILITY (CSR) POLICY

1. PREFACE

Corporate Social Responsibility (CSR) is a concept whereby organizations serve the interests of society by taking responsibility for the impact of their activities on customers, employees, shareholders, communities, and the environment in all aspects of their operations.

CSR is a company’s commitment to operate in an economically, socially, and environmentally sustainable manner while recognising the interests of its stakeholders. CSR is, therefore, closely linked with the practice of Sustainable Development. CSR extends beyond philanthropic activities and reaches out to integrate social and business goals.

Narayani Gems and Ornaments Private Limited (“the Company”) primarily recognises that the Company, being a business citizen should go beyond having a profit-making objective, to develop the society within its reach and accordingly, take the initiative to contribute towards the welfare of various segments of society by undertaking socially and economically useful programs for sustainable development of the community and society at large.

This CSR Policy encompasses the Company’s philosophy towards corporate social responsibility and lays down the guidelines and mechanism for undertaking socially relevant activities or programmes for sustainable development of the community and society at large and at the same time, to comply with the relevant local regulations.

2. PHILOSOPHY AND VISION

To align the Company’s vision with that of the society and integrate sustainable development of the community and society into the Company’s business model.

3. CSR OBJECTIVES

The CSR Objectives of the Company are to build long-term and sustainable partnerships with the communities around the Company based on the CSR activities that would be undertaken by the Company from time to time.
 

4. OBJECTIVES OF CSR POLICY

The objectives of this CSR Policy are to define the framework for undertaking CSR activities for achieving the CSR objectives of the Company and to lay down the guiding principles concerning the following-

• CSR Spend
• Identification of CSR Projects
• Mode of implementation of the CSR Projects
• Formulation of an Annual Action Plan
• Manner of monitoring Mechanism of the CSR spending with respect to the CSR Projects undertaken by the Company

5. CSR COMMITTEE

The Board of Directors shall constitute a CSR Committee of the Board of Directors (CSR Committee) consisting of at least two or more directors to review and recommend the CSR budget and the Annual Action plan with respect to the CSR activities to be undertaken and to monitor the CSR spend and implementation of CSR activities by implementing agencies. The main functions of the CSR Committee shall be:

• To formulate the CSR Policy and recommend the Board for its approval;
• To recommend the Board of Directors regarding any modifications to the CSR Policy;
• Recommending Annual CSR Budget to the Board of Directors;
• Identify CSR activities to be undertaken by the Company and formulate the Annual Action Plan and recommend the same for the approval of the Board of Directors;
• Institute a transparent monitoring mechanism for the implementation of the CSR activities;
• Monitor the implementation of the CSR activities;
• Submitting a report to the Board on a periodic basis on the CSR activities undertaken by the Company and the expenditure incurred on the same.

6. CSR ACTIVITIES

6.1 To attain its CSR objectives in a professional and integrated manner, the Company shall from time to time undertake the activities enumerated under Schedule VII of the Companies Act, 2013 (“Act”), as amended from time to time or such other activities as may be notified by the Ministry of Corporate Affairs from time to time, as may be approved by the Board of Directors of the Company.

6.2 For undertaking CSR activities and programmes, preference shall be given to the areas where it has strong employee presence. It may also be opted to undertake CSR activities and programmes

at other places in India. Depending on the programmes, activities and needs, long-term, medium-term, and short-term CSR activities may be undertaken.

6.3 CSR activities shall not include activities undertaken by the Company during the normal course of its business.

7. CSR SPEND

7.1 CSR Budget

i. The Board of Directors shall ensure to spend at least two per cent of the average net profit made during the three immediately preceding financial years towards CSR activities/programs. The computation of average net profits shall be in accordance with the Act.
ii. The Annual CSR Budget shall be approved by the Board of Directors of the Company on recommendation of the CSR Committee before undertaking any CSR spend.
iii. Prior approval of the CSR Committee and the Board of Directors shall be obtained for any change in the CSR Budget already approved by the Board.
iv. Any surplus arising out of the CSR activities and programmes shall not form a part of the business profits and shall be utilized for CSR activities in accordance with the Act. However, this spend shall not be considered for calculating the minimum 2% CSR spend as required under the Act.

7.2 Excess CSR Spend

Subject to the provisions of the Act, CSR spend in excess of the statutory requirement, may be set off against the requirement to spend towards CSR activities for the subsequent years with the approval of the Board.

8 MODE OF IMPLEMENTATION

8.1 The CSR activities and programmes shall be undertaken directly or through Section 8 Company/ Registered Public Trust/ Registered Society registered under Sec 12A and 80G of the Income Tax Act established by any of the following and having CSR Registration Number allotted by the Ministry of Corporate Affairs:

• Company singly or along with any other Company
• Central or State Government
• Any third party provided that the said entity has a track record of minimum 3 years in undertaking similar activities
• Any entity established by an Act of Parliament or State Legislatures

8.2 The Company may also collaborate with other Companies for undertaking CSR activities or programs.

9 FORMULATION OF AN ANNUAL ACTION PLAN

On the basis of the CSR activities or programs identified, the CSR Committee shall prepare an Annual Action Plan including but not limited to the below mentioned details and submit to the Board of Directors for their approval:

i. Details of CSR activities or programmes identified including the details of beneficiaries of the proposed CSR programs
ii. Corresponding activity as per Schedule VII of the Act.
iii. Location of the project
iv. Amount allocated for the project
v. Mode of implementation
vi. Details of Implementing Agency which shall include the below details:
a) Registration Certificate under section 12A
b) Registration Certificate under 80G of the Income Tax Act, 1961
c) CSR Registration Number allotted by the Ministry of Corporate Affairs
vii. Project duration which shall include the below details which shall include the below details:
a) Timeline for contributing the CSR fund to the Implementing Agency
b) Timeline for utilization of the CSR fund by the Implementing agency
viii. Monitoring and reporting mechanism for each CSR Project
ix. Details of the need for impact assessment, if any, required to be undertaken for the CSR projects to be undertaken by the Company as required under the Act.

10 MONITORING

For an effective implementation of CSR activities and programmes, an internal monitoring mechanism as approved by the CSR Committee will be put into force. Internal Monitoring Mechanism shall ensure the following:

10.1 Prior approval of the Board for each spending

CSR activities/programmes shall be approved by the Board of Directors before undertaking any CSR spend. For this purpose, a detailed Annual Action Plan shall be formulated by the CSR Committee and placed before the Board of Directors for their review and approval.

10.2 Execution of CSR Projects/Programs

CSR Committee shall work with the respective implementing agencies for making the CSR contribution and shall monitor the execution of CSR projects by the implementing agencies and utilization of CSR fund as per the Annual Action Plan approved by the Board. Where the CSR activities are undertaken directly by the Company, the CSR Committee shall ensure that the CSR spend is incurred as per the approved Annual Action Plan.

10.3 Annual reporting to Board on the amount spent and activity(ies) undertaken

The CSR Committee shall submit report to the Board on the details of CSR spend, utilization and status of CSR activities/programs periodically.

10.4 Periodic meetings of CSR Committee

The CSR Committee shall recommend to the Board of Directors CSR Budget and CSR activities/programs to be undertaken by the Company based on the Annual Action Plan. For effective implementation and monitoring of the CSR activities, CSR Committee shall meet periodically.

10.5 Annual review of CSR activities by the CSR Committee and recommend the changes in the CSR activities to the Board of Directors for the approval.

10.6 Unspent CSR Amount

Any unspent CSR amount at the end of a financial year shall be reported by the CSR Committee to the Board of Directors specifying the reasons for not spending the amount which in turn shall be reported by the Board of Directors in their Report for that particular financial year. Transfer of the unspent CSR amount to government specified fund shall be governed by the applicable provisions of the Act.

11 PUBLICATION OF CSR POLICY AND PROJECTS

Contents of the CSR Policy, CSR Projects approved and other details in compliance with the requirement under the Act shall be displayed on the Company’s website, if any.

12 AMENDMENTS TO CSR POLICY

The Board of Directors of the Company shall have the powers to revise/modify/amend this Policy from time to time, as the Board may think fit, based on the recommendations made by the CSR Committee to confirm to the revision/amendment, if any, to be made to the Act/Rules.