Corporate Social Responsibility (CSR) Policy

1. Objective and Scope

1.1. Objective

Iswarya Health Private Limited (hereinafter referred to as 'the Company') is committed to conducting its business in a manner that is socially responsible, environmentally sustainable, and beneficial to the communities it serves. The Company's Corporate Social Responsibility (CSR) framework is guided by its core mission of promoting women's health and reproductive well-being, and extends to broader societal goals including advancement of healthcare access, support for education, environmental stewardship, and the upliftment of marginalised communities. The Company shall operate with transparency, accountability, and a long-term commitment to social good.

1.2. Scope and Coverage

The Company shall have the freedom and flexibility to undertake any of the CSR activities specified in Schedule VII of the Companies Act, 2013, as amended from time to time. Any statutory amendments to Schedule VII that add, remove, or modify eligible activities shall automatically be read into this Policy without requiring a formal amendment, to the extent permissible under law.

2. Definitions

In this Policy, unless the context otherwise requires:

2.1. 'Act' means the Companies Act, 2013, including all rules, schedules, and amendments made thereunder.

2.2. 'Corporate Social Responsibility (CSR)' means the activities and obligations as defined under Section 135 of the Companies Act, 2013, read with the Companies (Corporate Social Responsibility Policy) Rules, 2014, and any amendments thereto.

2.3. 'Net Profit' means the net profit of the Company computed in accordance with the applicable provisions of the Act for the relevant financial year, and shall exclude:

1. any profit arising from overseas branch operations of the Company, whether operated as a separate entity or otherwise; and
2. any dividend received from other companies incorporated in India that are themselves covered under and compliant with the provisions of Section 135 of the Act.

2.4. 'Ongoing Project' means a multi-year CSR project undertaken by the Company in fulfilment of its CSR obligations, with a project timeline not exceeding three years from the financial year of commencement. A project initially approved for a single year may be reclassified as an ongoing project if the Board extends its duration beyond one year based on documented and reasonable justification.

Words and expressions used in this Policy but not defined herein shall carry the meanings respectively assigned to them under the Act and the Rules framed thereunder.

3. CSR Committee

3.1. Constitution

Pursuant to Section 135 of the Act, the Board of Directors of the Company shall constitute a Corporate Social Responsibility Committee ('CSR Committee'). The Committee shall comprise at least two Directors, including the Managing Director, as may be required under applicable law. The composition of the Committee shall be disclosed in the Company's Annual Report and on its website.

3.2. Functions and Powers of the CSR Committee

To enable effective discharge of the Company's CSR objectives, the CSR Committee is vested with the following responsibilities and powers:

1. Formulate the CSR Policy and recommend it to the Board of Directors for approval, and recommend any revisions or amendments thereto as may be required from time to time;
2. Identify and recommend CSR activities, projects, and programmes aligned with Schedule VII of the Act and the Company's stated CSR objectives;
3. Recommend the quantum of CSR expenditure to be incurred in each financial year;
4. Explore and recommend opportunities for undertaking CSR activities in collaboration with group companies, other corporates, implementing agencies, NGOs, or other eligible entities, and ensure compliance with reporting requirements in respect of such collaborative activities;
5. Prepare and recommend the Annual Action Plan and CSR budget to the Board for approval;
6. Oversee and ensure that approved CSR funds are deployed in accordance with the Act, the Rules, and this Policy;
7. Design and implement a transparent and robust monitoring mechanism for all CSR initiatives;
8. Submit periodic reports to the Board on the status, progress, and impact of CSR activities undertaken;
9. Review and monitor adherence to this CSR Policy and recommend updates as needed; and
10. Invite and authorise senior executives or external experts to attend CSR Committee meetings as and when deemed necessary.

4. CSR Implementation

The CSR Committee shall be responsible for the approval, execution, implementation, and monitoring of all CSR projects and programmes. CSR activities shall ordinarily be executed directly by the Company, and where deemed appropriate, through partnerships with other corporates, local government bodies, non-governmental organisations (NGOs), implementing agencies, and other service providers.

5. CSR Budget

The CSR Committee shall prepare and present to the Board an annual CSR budget, aligned with the Annual Action Plan approved for the relevant financial year. The Company shall endeavour to spend, in each financial year, at least the minimum amount prescribed under Section 135(5) of the Act, computed on the basis of the Company's average net profits of the three immediately preceding financial years, at the rate prescribed under the Act.

The CSR budget and the Annual Action Plan shall be presented to the Board for approval before the commencement of the financial year, or within such timelines as may be prescribed under law.

6. CSR Expenditure

6.1. Eligible Expenditure

CSR expenditure may include amounts spent on approved CSR activities as well as amounts utilised for creation or acquisition of capital assets. Capital assets created through CSR funds shall be held by:

• A company established under Section 8 of the Act, or a registered public trust or registered society with charitable objects and a valid CSR Registration Number;
• Beneficiaries of the CSR project, including self-help groups, collectives, or similar entities; or
• A public authority or government body.

6.2. Administrative Overheads

The Board shall ensure that administrative overheads relating to CSR activities do not exceed five percent (5%) of the total CSR expenditure of the Company in any given financial year.

6.3. Excess CSR Expenditure

In the event the Company spends an amount in excess of the minimum required under Section 135(5) of the Act in any financial year, such excess may be set off against the mandatory CSR obligation for up to three immediately succeeding financial years, subject to the following conditions:

• The excess amount eligible for set-off shall not include any surplus generated from CSR activities; and
• The Board shall pass a specific resolution authorising such set-off.

6.4. Surplus from CSR Activities

Any surplus arising out of CSR activities undertaken by the Company shall not form part of the Company's business profits and shall be:

• Reinvested into the same CSR project; or
• Transferred to the Unspent CSR Account and subsequently deployed in accordance with this Policy and the Annual Action Plan, or transferred to a Fund specified in Schedule VII of the Act, within six months from the close of the financial year.

6.5. Activities That Do Not Constitute CSR Expenditure

The following activities shall not qualify as CSR expenditure for the purposes of this Policy and the Act:

1. Activities undertaken in the normal course of business; provided that research and development (R&D) activities for new vaccines, drugs, and medical devices may be included as CSR activities subject to the conditions prescribed under applicable law;
2. Activities conducted outside India, except for training of Indian sports personnel representing any State, Union Territory, or India at national or international level;
3. Direct or indirect contributions to any political party under Section 182 of the Act;
4. Activities that primarily benefit the Company's own employees, as defined under the Code on Wages, 2019;
5. Activities undertaken on a sponsorship basis by the Company for the purpose of deriving marketing or brand-building benefits; and
6. Activities carried out solely to fulfil statutory obligations prescribed under any other law in force in India.

7. Failure to Spend the Mandatory CSR Amount

In any financial year where the Company is unable to spend the full mandatory CSR amount as prescribed under Section 135(5) of the Act, the CSR Committee shall submit a written report to the Board of Directors detailing the reasons for such shortfall. The Board shall, in turn, disclose the reasons for underspending in the Directors' Report for the relevant financial year.

Such underspending shall not reduce the mandatory CSR expenditure requirement for subsequent financial years.

Any unspent CSR amount at the close of a financial year shall be handled as follows:

• If the unspent amount relates to an ongoing project, the Company shall transfer the amount to a dedicated 'Unspent Corporate Social Responsibility Account' in a scheduled bank within thirty days from the end of the financial year. The amount shall be utilised in fulfilment of the Company's CSR obligations within three financial years from the date of transfer; failing which, the amount shall be transferred to a Fund specified in Schedule VII within thirty days from the end of the third financial year.
• If the unspent amount does not relate to any ongoing project, it shall be transferred to a Fund specified in Schedule VII of the Act within six months from the close of the financial year.

8. Disclosure and Reporting

The Company shall make the following disclosures in its Annual Report, in accordance with the Act and Rules:

• Details of the CSR Policy adopted and implemented by the Company;
• An overview of CSR initiatives and projects undertaken during the financial year;
• Details of CSR expenditure incurred, including amounts spent and unspent, if any, and reasons therefor; and
• Any other disclosures required under the Act, Rules, or applicable regulatory guidelines.

This Policy shall be subject to amendment in accordance with applicable provisions of the Act and any notifications, circulars, or guidelines issued by the Government of India from time to time. The Chairperson of the CSR Committee is authorised to make incidental or procedural amendments to this Policy, subject to subsequent ratification by the Board.

9. Impact Assessment

Where the Company's average CSR obligation over the three immediately preceding financial years exceeds INR 10 Crore, the Company shall be required to undertake an independent impact assessment for CSR projects with an individual outlay of INR 1 Crore or more, which have been completed at least one year prior to the date of the assessment.

Impact assessment reports shall be placed before the Board of Directors and annexed to the Annual CSR Report.

Expenditure incurred on impact assessment activities may be treated as CSR expenditure for the relevant financial year, subject to a ceiling of two percent of the total CSR expenditure for that year or INR 50 Lakhs, whichever is higher.

10. Monitoring Mechanism

10.1. At the CSR Committee Level

The CSR Committee shall periodically review the implementation of this Policy and shall, among other matters, attend to the following:

• Verify that all CSR projects are being executed either directly by the Company or through eligible implementing agencies duly registered with the Central Government (by filing Form CSR-1, as applicable from April 01, 2021);
• Monitor the utilisation of approved CSR funds against sanctioned budgets;
• Evaluate the actual outcomes and impact of CSR activities on intended beneficiaries, communities, and the environment;
• Identify and address deviations from approved plans, and recommend corrective action where required; and
• Ensure timely compliance with all disclosure and reporting requirements under the CSR provisions of the Act.

10.2. At the Board Level

The Board of Directors shall, at least annually, review and ensure the following:

• All CSR expenditures, including fund utilisation and any unspent balances, are in compliance with the guidelines set forth in this Policy and the applicable Rules;
• All disclosure obligations with respect to the Company's website and Annual Report have been duly fulfilled;
• Ongoing projects are on track within approved timelines and year-wise allocations, and the Board shall have the authority to approve modifications to ongoing projects to ensure timely completion within permissible limits; and
• The Chief Financial Officer or the officer responsible for financial management has certified that CSR funds have been utilised solely for the purposes and in the manner approved by the Board.

11. Review and Amendment of Policy

The Board of Directors may revise, update, or amend this CSR Policy at any time, based on the recommendations of the CSR Committee or to align the Policy with statutory amendments, regulatory guidance, or changes in the Company's business or operating context.

Notwithstanding any provision contained in this Policy, the requirements of the Companies Act, 2013 and the Rules thereunder shall at all times prevail. In the event of any conflict or inconsistency between this Policy and applicable law, the provisions of the law shall supersede this Policy.

— End of Policy —