Corporate Social Responsibility Policy

Context

In accordance with the provisions of Section 135 of Companies Act, 2013 (“the Act”), read with Schedule VII of the Companies Act, 2013 and the Companies (Corporate Social Responsibility Policy) Rules, 2013, “Jaipur Rugs Company Limited” (hereinafter referred as “JRCL” or “the Company”) has formulated this Corporate Social Responsibility (CSR) Policy to fulfill the sense of responsibility towards the community and environment in which it operates.

Objective and Scope

The objective of this Policy is to outline guidelines for the Company’s CSR activities to make a positive contribution to society through social and economic welfare programs. All CSR Projects / Programs / Activities will be conceived and implemented by the Company through a focused approach towards target beneficiaries for generating maximum impact.

This Policy shall apply to all CSR Projects / Programmers / Activities undertaken by the Company in India as per Schedule VII of the Act.

Policy Statement

To enable JRCL to sustain and strengthen its position as a responsible corporate entity driving socio-economic transformation of rural communities through its inclusive rug value chain and broader grassroot initiatives for community development.

Policy Framework

Building on the experience of JRCL in working with grassroots communities, the evidence is clear that provisioning of sustainable livelihood opportunities has helped people come out of the vicious cycle of poverty while continuing to live in their traditional rural habitations. JRCL has been instrumental in enabling such communities, comprising the base of the economic pyramid, to build relevant capabilities and participate in broader economic ecosystems, without sacrificing their avenues for alternative livelihoods. Such economic empowerment of grassroots communities also opens various avenues for social security and development linkages, thus reaffirming livelihood security as the first step toward other developmental imperatives.

Definitions

1. “Act” means the Companies Act, 2013 including any statutory modification or re-enactment thereof.
2. “Board” means the Board of Directors of the Company.
3. “Board’s Report” shall mean report of the Board of Directors prepared in accordance with section 134(3) of the Companies Act, 2013.
4. “Company” means M/s Jaipur Rugs Company Limited.
5. “Corporate Social Responsibility (CSR) Activities” means the activities as mentioned in Schedule VII of the Act, as amended from time to time.
6. “CSR Committee” means the Corporate Social Responsibility Committee constituted by the Board of the Company from time to time in terms of the provisions of Section 135 of the Act.
7. “CSR Policy” means the Corporate Social Responsibility Policy as set out herein and as amended or modified from time to time.
8. “Implementing Agency” means any entity registered with Ministry of Corporate Affairs for undertaking CSR projects, which is engaged by the Company to implement various projects in pursuance of CSR Policy.
9. “Net Profit” shall be the net profit of the Company calculated in accordance with the provisions of section 198 of the Act.
10. “Rules” shall mean the Companies (Corporate Social Responsibility Policy) Rules, 2014 and shall include any amendments made thereto.

Any term used in this policy but not defined herein shall have the same meaning assigned to them under the Act and CSR Rules as applicable to the Company.

CSR Committee

The Board of Directors of the Company shall constitute a Committee called the “Corporate Social Responsibility Committee” (“CSR Committee”) in accordance with the provisions of Companies Act, 2013 and rules made thereunder.

Subject to provisions of Companies Act, 2013 and rules made thereunder, the CSR Committee shall hold one meeting in every financial year or may meet at such intervals, in such manner and may carry out matters in such manner and function generally as per such guidelines as it deems fit.

The CSR Committee shall have, inter alia, the following roles, powers and responsibility:

1. Formulate and recommend to the Board, a CSR Policy which shall indicate the activities to be undertaken by the Company in areas or subject, specified in Schedule VII;
2. Recommend the amount of expenditure to be incurred on the activities referred to in clause (i) above;
3. Submit reports / status update to the Board in respect of the CSR activities undertaken by the Company;
4. Monitor the CSR Policy from time to time;
5. Formulate and recommend to the Board, an Annual Action Plan which shall include the following:
   1. the list of CSR projects or programmes that are approved to be undertaken in areas or subjects specified in Schedule VII of the Act;
   2. the manner of execution of such projects or programmes as specified in sub-rule (1) of rule 4 of Rules;
   3. the modalities of utilisation of funds and implementation schedules for the projects or programmes;
   4. the monitoring and reporting mechanism for the projects or programmes; and
   5. details of need and impact assessment, if any, for the projects undertaken by the Company.

   The Board of Directors are empowered to alter the annual action plan during the financial year, if so recommended by the CSR Committee, based on the reasonable justification for such change.

6. Carry out all such acts, deeds, matters and things as may be required in connection with aforesaid matters and generally for any matter connected with the CSR policy of the Company;
7. To perform such functions as may be entrusted by the Board of Directors from time to time.

Role of the Board

The Board of every Company shall:

1. after taking into account the recommendations made by the CSR Committee, approve the CSR Policy of the Company;
2. ensure that the activities as are included in CSR Policy of the Company are undertaken by the Company;
3. satisfy itself that the funds so disbursed have been utilised for the purposes and in the manner as approved by it and the Chief Financial Officer or the person responsible for financial management shall certify to the effect;
4. The Board of the Company may decide to undertake CSR activities, as approved by the CSR Committee, through an implementing agency, including a registered trust, a registered society or a company established under Section 8 of the Act. Such entities may be established by the Company, either singly or jointly with its holding, subsidiary or associate company or along with any other company or its holding, subsidiary or associate company. In cases where the implementing entity is not established by the Company, either singly or in the manner stated above, such entity shall have an established track record of at least 3 years in undertaking similar CSR programmes, projects or activities.

CSR Activities

The Company proposes to undertake the CSR activities in any of the following areas as mentioned in Schedule VII of the Act, as amended from time to time:

1. Eradicating hunger, poverty and malnutrition, promoting preventive health care and sanitation including contribution to the Swachh Bharat Kosh set-up by the Central Government for the promotion of sanitation and making available safe drinking water;
2. Promoting education including special education and employment enhancing vocation skills specially among children, women, elderly and differently able and livelihood enhancement projects;
3. Promoting gender equality, empowering women, setting up homes and hostels for women and orphans, setting up old age homes, day care centers and such other facilities for senior citizens and measures for reducing inequalities faced by socially and economically backward groups;
4. Ensuring environmental sustainability, ecological balance, protection of flora and fauna, animal welfare and agroforestry, conservation of natural resources and maintaining quality of soil, air and water including contribution to the Clean Ganga Fund set-up by the Central Government for rejuvenation of river Ganga;
5. Protection of national heritage, art and culture including restoration f buildings and sites of historical importance and works of art; setting up public library; promotion and development of traditional art and handicrafts;
6. Measures for the benefit of armed force veterans, war widows and their dependents, Central Armed Police Forces (CAPF) and Central Para Military Forces (CPMF) veterans, and their dependents including widows;
7. Training to promote rural sports, nationally recognized sports, paralympic sports and Olympic sports;
8. Contribution to the prime minister's national relief fund or Prime Minister’s Citizen Assistance and Relief in Emergency Situations Fund (PM CARES Fund) or any other fund set up by the central govt. for socio economic development and relief and welfare of the schedule caste, tribes, other backward classes, minorities and women;
9. Contribution to incubators or research and development projects in the field of science, technology, engineering and medicine, funded by the Central Government or State Government or Public Sector Undertaking or any agency of the Central Government or State Government; and
10. Contributions to public funded Universities, Indian Institute of Technology (IITs), National Laboratories and autonomous bodies established under Department of Atomic Energy (DAE), Department of Biotechnology (DBT), Department of Science and Technology (DST), Department of Pharmaceuticals, Ministry of Ayurveda, Yoga and Naturopathy, Unani, Siddha and Homoeopathy (AYUSH), Ministry of Electronics and Information Technology and other bodies, namely Defense Research and Development Organisation (DRDO), Indian Council of Agricultural Research (ICAR), Indian Council of Medical Research (ICMR) and Council of Scientific and Industrial Research (CSIR), engaged in conducting research in science, technology, engineering and medicine aimed at promoting Sustainable Development Goals (SDGs);
11. Rural Development Projects;
12. Slum Area Development (“slum area‟ shall mean any area declared as such by the Central Government or any State Government or any other competent authority under any law for the time being in force);
13. Disaster Management, including relief, rehabilitation and reconstruction activities;
14. Such other activities as may be recognized by the Committee/Board or as may be required/ permissible under prevailing law(s).

For the purpose of the CSR Policy, the CSR activities shall exclude activities undertaken in pursuance of the normal course of business of the Company.

CSR Expenditure

1. The Board shall ensure that in each financial year the Company spends at least 2% of the average net profits of the Company made during the three immediately preceding financial years, calculated in accordance with Section 198 of the Act, in pursuance of its CSR Policy. Further, while spending the amount earmarked for CSR activities, preference should be given to local areas and areas around the Company where it operates. However, this shall not bar the Company from pursuing its CSR objects in other areas;
2. The CSR activities undertaken in India only shall amount to CSR Expenditure;
3. Any surplus arising out of CSR projects, programs and activities shall not form part of the business profits of the Company and shall be ploughed back into the same project or can be transferred to Unspent CSR Account and spent in pursuance of CSR policy and annual action plan of the Company or transfer such surplus amount to a fund specified in Schedule VII, within a period of 6 months of the expiry of the Financial year;
4. The Company will report reasons for under spending, if any, of the allocated CSR budget of the current financial year in the Board`s Report;
5. Any amount spent in excess of requirement may be set off against the requirement to spend up to immediate succeeding 3 financial years subject to the conditions that the excess amount available for set off shall not include the surplus arising out of the CSR activities, if any and the Board of the Company shall pass a resolution to that effect.

Disclosure of the Policy

The CSR policy recommended by the CSR Committee and approved by the Board shall be displayed on the Company’s website and shall be disclosed in the Board’s Report as well.

CSR Reporting

The Board Report of a Company shall include an Annual Report on CSR containing particulars specified in Annexure to the CSR Rules as per the prescribed format.

Amendment and Review

The CSR Committee shall review and recommend revisions to the CSR Policy, whenever it deems fit and place before the Board the CSR Policy containing such draft revisions for the Board’s approval. Any change in the Policy shall be approved by the Board. The Board shall have the right to withdraw and/or amend any part of this Policy or the entire Policy, at any time, as it deems fit or from time to time and the decision of the Board in this respect shall be final and binding. Any subsequent amendment/modification in the Act or the rules framed thereunder and/or any other laws in this regard shall automatically apply to this Policy.

Note: This Policy was last approved by the Board of Directors on recommendation of Corporate Social Responsibility Committee at its meeting held on 06.09.2025.