Authors: Aditi Sarkar; Adreeja Bagchi

INTRODUCTION

Sustainability, whose major focus is on environmental and economic practices to bring inclusive growth, has become a governance and legal issue and no longer remains a questionof ethics, compliance and social responsibility. According to section 135 of the Companies Act 2013, every eligible company must spend at least 2% of its average net profits on social impact activities that benefit society at large. CSR by itself is a small part of sustainability, but it certainly makes companies more accountable to society, which is a positive step. However, CSR spending does not necessarily imply an extensive sustainable business. Section 166 of the Companies Act of 2013 provides a legal basis for integration of sustainability. The directors duties codified in this section, promotes the objectives of the company wherein the director must act in good faith. The director are required to act towards promoting the objectives of the company for the benefit of the members as a whole. This idea has been further strengthened through judicial precedents along with section (2)2 wherein the below consideration came about:

Section 166 of the Companies Act of 2013, provides a legal basis for integration of sustainability. The directors duties codified in this section, promotes the objectives of the company wherein the director must act in good faith. The director are required to act towards promoting the objectives of the company for the benefit of the members as a whole. This idea has been further strengthened through judicial precedents1 along with section (2)2 wherein the below consideration came about:

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