Preparedness of Indian Public Equities for Business Sustainability Disclosure and Reporting

Through its board resolution passed on November 24th, 2011, the Securities and Exchange Board of India (SEBI), has mandated listed companies to report on Environmental, Social and Governance (ESG) initiatives undertaken by them through a Business Responsibility (BR) report which would form part of a company’s annual reports/filings.

This briefing presents an insight into the current policy framework in India related to Business Responsibility reporting, especially the National Voluntary Guidelines on Social, Environmental and Economic Responsibilities of Business and elucidates the need and drivers for business sustainability reporting.

The brief also describes the state of Business Responsibility reporting of large Indian public equities based on findings of a study on the disclosure levels of Sensex companies with respect to National Voluntary Guidelines on Responsible Business.

Finally the brief discusses the way forward for Business Responsibility reporting by the companies and the opportunities and challenges associated with it. With the new regulation, adoption of Business Responsibility reporting will see a sharp uptake which in turn might also sensitize the remaining companies about the benefits of enhanced disclosure of non-financial performance, such as that related to environmental, social and governance metrics.