There is no doubt that the rise of ESG has sparked significant transformations on a global scale. As we observe the shifts and obstacles associated with the environmental, social, and governance aspects, it becomes evident that leaders must revaluate their strategies to align with corporate principles and address the themes introduced by stakeholders. This is particularly relevant in India, where the impact of ESG is becoming increasingly pronounced. By embracing these principles, leaders can navigate the complexities of ESG and ensure sustainable growth while meeting the expectations of their stakeholders.
According to the reports, as stated In July 2023, SEBI added new ESG metrics for mandatory disclosure under ‘BRSR Core’ for certain listed companies in India. The Business Responsibility and Sustainability Report (BRSR) format was initially introduced in May 2021 and replaced the previous Business Responsibility Report (BRR).
Besides, let us acquaint ourselves with ESG reporting as per SEBI BRSR in India and dive deep into the factors that dictate the same.
What is ESG Reporting?
ESG Reporting is a type of disclosure that focuses on an organization's efforts and progress in environmental, social, and governance activities. The primary purpose of such disclosures is to transparently record the company's ESG activities and encourage other organizations to do the same. Accordingly, the ESG framework mainly reports metrics involving Human rights policies, greenhouse gas emissions, and risk management strategies.
In contrast, reporting is seen as a strategic way to demonstrate that an organization is meeting requirements and genuinely committed to ESG projects rather than making empty promises. An ESG report provides valuable insights into the progress achieved in environmental sustainability and corporate governance. It outlines the efforts made and their impact on the overall ESG data. Additionally, ESG reports serve as a means of communication, providing necessary information to regulatory authorities, employees, and investors.
How is BRSR Different from BRR?
The origins of ESG Requirements in India can be traced back to 2012 when the Securities and Exchange Board of India established it. At that time, the mandate was for the top 100 companies in India, focusing on market capitalization, to file a business Responsibility Report (BRR). Over time, this evolved into the BRSR, a reporting framework for ESG. This development has been crucial in helping to bridge the gap in accurately measuring the depth of reporting. As of 2021, this is a significant achievement.