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For many small and medium enterprises, ESG reporting is treated...
As businesses worldwide pivot toward responsible and sustainable practices, Indian enterprises are also embracing this crucial shift. With increasing challenges related to Environmental, Social, and Governance (ESG) dimensions, Indian business leaders recognize the need to reorient their corporate purpose beyond mere profit maximization to encompass broader stakeholder value creation.
In this context, SEBI has issued the Business Responsibility and Sustainability Reporting (BRSR) guidelines in 2021. This mandates certain listed companies to disclose their ESG practices, marking a significant leap in integrating sustainability into the core operations of Indian businesses.
The journey of Business Responsibility and Sustainability Reporting (BRSR) in India reflects an increasing commitment to corporate sustainability. It began in 2009 with the Ministry of Corporate Affairs (MCA) releasing the Voluntary Guidelines on Corporate Social Responsibility (CSR), which laid the groundwork for responsible business practices.
In 2011, India took significant strides by endorsing the United Nations Guiding Principles on Business and Human Rights (UNGPs) and introducing the National Voluntary Guidelines on Social, Environmental, and Economic Responsibilities of Business (NVGs). These initiatives emphasized the integration of human rights and sustainability into corporate strategies.
The Business Responsibility Report (BRR) was introduced in 2012 for the top 100 listed companies, marking a critical step in promoting transparency and accountability in corporate governance. However, in 2021, SEBI upgraded this framework to the more comprehensive BRSR, requiring companies to enhance their ESG disclosures and better align with global sustainability standards.
By 2022-23, BRSR became mandatory for the top 1,000 listed companies, further solidifying the commitment to sustainability. The evolution continued in July 2023 with the launch of BRSR Core, mandating enhanced ESG disclosures in Annual Reports, thus emphasizing the importance of sustainability throughout the entire value chain.
Together, these developments chart a clear course toward embedding sustainability into the core of Indian business practices, aligning them with the global movement for responsible corporate behavior.
BRSR reporting transcends mere regulatory compliance; it serves as a gateway for businesses to align with global sustainability standards, attract ESG-focused investors, and enhance long-term competitiveness. This commitment to sustainability and transparency signals a broader responsibility to society.
Embracing BRSR allows Indian companies to adopt a framework emphasizing holistic growth, ethical practices, and responsible corporate conduct. It also showcases their contributions toward sustainability goals, such as the UN’s Sustainable Development Goals (SDGs).
These principles are designed to ensure that Indian businesses contribute positively to society while minimizing their environmental impact.
The BRSR guidelines provide a structured approach for companies to report on their ESG performance. The framework is divided into three sections:
Indian companies must adhere to these guidelines to provide a comprehensive view of their sustainability efforts.
The BRSR framework is a powerful tool for Indian businesses to showcase their commitment to responsible and sustainable practices. By adhering to BRSR guidelines and aligning with its nine principles, companies can build resilient, ethical, and future-ready business models.
As the world shifts toward sustainable growth, BRSR reporting will not only be a compliance requirement but also a key differentiator for businesses seeking to lead in this new era of responsible business. With the introduction of BRSR Core, which emphasizes enhanced ESG disclosures and value chain transparency, companies will have an opportunity to further demonstrate their commitments towards environmental and social wellbeing.
Indian companies that embrace BRSR and its core components now will be well-positioned to thrive in the evolving global economy, where sustainability is increasingly paramount. By investing in these practices, businesses can enhance their reputation, attract investment, and contribute to a more sustainable future.
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About the author
Director – Projects & Value Chain at SAM Corporate LLC
Follow the expert:
Rajagopal Kannan is the Director of Projects & Value Chain at SAM Corporate LLC, leading ESG, risk management, and sustainability initiatives. With over 20 years of experience, including a decade in banking and financial risk, he specializes in credit structuring, Basel II & III, ISO 31000, COSO ERM, internal audit, and regulatory compliance under CBUAE, DFSA, ADGM, and SCA.
His current focus lies in ESG integration, climate and sustainability risk management, and value chain sustainability. A GRI-certified Sustainability Professional and GARP-certified SCR holder, he also holds multiple global credentials including PRM®, GRCP, GRCA, CRCMP, CBiiiPro, CSM, and CISI Level 3.
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