This article was originally published FastCompany.com.

Corporate social responsibility (CSR) is no longer a choice for Indian companies of a certain size: It’s a legal requirement. In April 2014, the hotly debated Companies Act forced approximately 3,000 organizations to form a CSR committee, and spend 2% of their average net profits over the past three years on social development and environmental projects. The initiative only affects Indian companies with a market cap over 5 billion INR (about $77 million USD), turnover above 10 billion INR (about $155 million USD), or annual profits greater than 50 million INR (about $770,000 USD).

In theory, the mandate has its appeal; it’s comforting to think that “too big to fail” is, at least in one country, also associated with “big enough to do their part.” In the highly competitive North American talent market, however, companies that champion social initiatives also improve their employer brand, and ultimately their ability to recruit employees. In the United States, where CSR is voluntary, determining a company’s true level of commitment remains a challenge for job seekers. While there is no universal measurement tool for social impact, pressure from job seekers has forced organizations to recognize the impact they have on the world, which may ultimately prove more effective than any government legislation.

“Everyone has a different definition, and its called different things at different companies, but it’s about more than philanthropy; it’s about how you operate as a corporate citizen,” said Karyn Margolis, the director of CSR and sustainability at Avon Products Inc. “It goes back to authenticity; it has to be about how the company operates, and philanthropy and social programs are an extension of that, but it’s much broader than giving away money.”

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