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Republic of the Philippines 
HOUSE OF REPRESENTATIVES 
Quezon City 
First Regular Session 
TWENTIETH CONGRESS 
House Bill No. 847
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Introduced by REP. JESUS MANUEL “BONG” C. SUNTAY 
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EXPLANATORY NOTE 
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Corporate Social Responsibility (CSR) has emerged as a key pillar of sustainable 
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development and inclusive economic growth. Recognizing the vital role of businesses in 
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addressing social, economic, and environmental challenges, this bill seeks to encourage 
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and operationalize CSR across all business organizations. 
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While Philippine corporations have increasingly engaged in CSR, there remain gaps in 
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accountability, standards, and clarity on how resources, including retained earnings, 
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should be allocated to ensure projects truly benefit communities. This measure 
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strengthens existing legal frameworks by requiring clear plans, board approvals, 
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timelines, and reporting mechanisms for CSR-related retained earnings. It also provides 
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guidance on eligible CSR activities, encourages best practices, and enforces 
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transparency. 
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With these improvements, CSR becomes a meaningful tool for nation-building rather 
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than a loophole for avoiding dividends. It aligns corporate actions with national 
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development goals and global standards, advancing social welfare, environmental 
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protection, and sustainable growth. 
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Immediate passage of this measure is earnestly sought. 
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REP. JESUS MANUEL “BONG” C. SUNTAY 
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July 1, 2025
2:20 pm


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Republic of the Philippines 
HOUSE OF REPRESENTATIVES 
Quezon City 
First Regular Session 
TWENTIETH CONGRESS 
                    House Bill No. 847 
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Introduced by REP. JESUS MANUEL “BONG” C. SUNTAY 
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AN ACT ENCOURAGING CORPORATE SOCIAL RESPONSIBILITY, 
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PROVIDING INCENTIVES, AND ESTABLISHING GUIDELINES FOR THE 
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JUSTIFIED RETENTION OF EARNINGS FOR CSR PROJECTS, AND FOR 
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OTHER PURPOSES 
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Be it enacted by the Senate and House of Representatives of the Philippines in Congress 
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assembled: 
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SECTION 1. Short Title. 
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This Act shall be known as the “Corporate Social Responsibility Act.” 
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SEC. 2. Declaration of Policy. 
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The State recognizes the vital role of the private sector in nation-building and shall 
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encourage active participation in fostering sustainable economic development, social 
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welfare, and environmental protection through meaningful corporate social 
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responsibility (CSR). 
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SEC. 3. Corporate Social Responsibility. 
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All business organizations established and operating under Philippine laws, whether 
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domestic or foreign, are hereby encouraged to observe CSR in their operations. 
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For purposes of this Act, CSR refers to the voluntary commitment of businesses to 
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contribute to sustainable economic development by working with stakeholders to 
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improve lives in ways that benefit business, advance the national sustainable 
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development agenda, and promote social good. 
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CSR-related activities may include but are not limited to: 
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a) Charitable programs and projects;
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b) Scientific research;
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c) Youth and sports development;
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d) Cultural or educational promotion;
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e) Services to veterans and senior citizens;
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f) Social welfare;
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g) Environmental sustainability;
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h) Health development; 
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i) Disaster relief and assistance; 
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j) Socialized and low-cost housing; and 
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k) Employee and worker welfare-related activities. 
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Business organizations may donate products and services under their CSR-related 
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activities for disaster relief and assistance, in accordance with regulations issued by the 
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appropriate government agency. Any law or regulation restricting LGUs under a state of 
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calamity or national emergency from accepting such donations is hereby amended. 
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SEC. 4. Deduction from Unrestricted Retained Earnings for CSR. 
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To encourage CSR engagement, Section 42 of Republic Act No. 11232, otherwise known 
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as the “Revised Corporation Code of the Philippines,” is amended to read: 
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“SEC. 42. Power to Declare Dividends. – xxx 
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Stock corporations are prohibited from retaining surplus profits in excess of one 
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hundred percent (100%) of their paid-in capital stock, except: 
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(a) when justified by definite corporate expansion or for corporate social 
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responsibility (CSR) projects or programs that: 
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  1) are formally approved by a two-thirds vote of the board of directors; 
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  2) have a detailed CSR plan specifying budget, timeline, measurable objectives, and 
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identified beneficiaries; 
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  3) are disclosed in audited financial statements and CSR periodic reports; 
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  4) will be implemented within two (2) years from retention; and 
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  5) comply with standards and guidelines set forth in the implementing rules and 
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regulations (IRR) of this Act; 
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(b) when the corporation is prohibited under a loan agreement with financial 
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institutions or creditors from declaring dividends without their consent, and such 
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consent has not yet been secured; or 
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(c) when retention is clearly necessary under special circumstances, such as creating 
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reserves for probable contingencies.” 
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CSR funds retained under this provision must be fully utilized within two (2) years of 
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board approval. Any unutilized amount after the period shall be included in the 
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computation of excess retained earnings subject to dividend declaration or appropriate 
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tax adjustments. 
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SEC. 5. CSR Plan Standards. 
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Corporations retaining earnings for CSR shall prepare and submit a CSR Plan to the 
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Securities and Exchange Commission (SEC) containing: 
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a) Description of projects or programs; 
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b) Target communities or beneficiaries; 
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c) Detailed budget breakdown; 
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d) Implementation timeline; 
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e) Expected social or environmental outcomes; and 
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f) Metrics for measuring impact. 
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SEC. 6. Verification and Reporting. 
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CSR-related retention of earnings shall be subject to verification by the SEC. 
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Corporations shall submit board resolutions, CSR project documents, audited 
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expenditures, and proof of implementation as part of their annual reports, certified by 
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an independent external auditor and signed by the company’s president and CSR officer. 
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SEC. 7. Awards and Recognition. 
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The Department of Trade and Industry (DTI) shall recognize and reward business 
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organizations for outstanding, innovative, and world-class CSR programs. The DTI shall 
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endorse domestic and foreign corporations in the Philippines as candidates for 
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international CSR awards. 
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SEC. 8. Local Government Unit Assistance. 
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LGUs where CSR activities are conducted shall provide necessary assistance to business 
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organizations implementing approved CSR programs. 
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SEC. 9. Penalties for Misrepresentation. 
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Any corporation misrepresenting the use of retained earnings for CSR shall, after due 
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process, be liable to an administrative fine of not less than 100% of the misused amount, 
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suspension of retention privileges, and possible revocation of corporate registration for 
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repeated offenses. 
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SEC. 10. Implementing Rules and Regulations. 
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Within sixty (60) days from effectivity, the Secretary of Finance, in coordination with 
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the DTI and the SEC, shall promulgate rules and regulations for the effective 
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implementation of this Act. 
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SEC. 11. Separability Clause. 
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If any provision of this Act is declared invalid or unconstitutional, the remaining 
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provisions shall remain in full force and effect. 
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SEC. 12. Repealing Clause. 
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Section 42 of Republic Act No. 11232 is hereby amended. All other laws, decrees, orders, 
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rules, regulations, or issuances inconsistent with this Act are repealed or modified 
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accordingly. 
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SEC. 13. Effectivity. 
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This Act shall take effect fifteen (15) days after its publication in the Official Gazette or a 
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newspaper of general circulation. 
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Approved. 
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