Comparing Global and Indian Standards for ESG Reporting: A Path to Sustainable Corporate Practices

As sustainability gains increasing importance in the corporate world, companies worldwide are adopting ESG (Environmental, Social, and Governance) reporting to showcase their commitment to responsible practices. ESG reporting provides transparency and a comprehensive view of a company's performance in areas such as environmental impact, social responsibility, and governance practices. While global standards have gained prominence, it is crucial to understand the similarities, differences, and convergence between global and Indian standards for ESG reporting. This article delves into the comparison and highlights the path towards aligning global and Indian standards for sustainable corporate practices.

Global Standards for ESG Reporting: Several globally recognized frameworks guide companies in their ESG reporting endeavors. The Global Reporting Initiative (GRI) Standards offer a comprehensive framework covering various ESG topics. Emphasizing materiality and stakeholder engagement, these standards help companies integrate sustainability into their business strategies. The Sustainability Accounting Standards Board (SASB) Standards focus on specific industry sectors, providing industry-specific metrics for comparability. The Task Force on Climate-related Financial Disclosures (TCFD) recommends reporting on climate-related risks and opportunities to encourage transparency in addressing climate change. 


Indian Standards for ESG Reporting: In India, the Securities and Exchange Board of India (SEBI) has taken significant steps to promote ESG reporting. The Business Responsibility and Sustainability Reporting (BRSR) framework requires the top 100 listed companies to disclose their Business Responsibility Reports (BRRs) with a specific focus on ESG aspects. The BRSR framework highlights governance, environmental impact, social initiatives, and stakeholder engagement. Additionally, the National Voluntary Guidelines on Social, Environmental, and Economic Responsibilities of Business (NVGs) offer guidance to Indian companies on incorporating sustainable practices into their operations, emphasizing responsible business conduct and environmental stewardship.


Comparing Global and Indian Standards: While global standards provide a strong foundation for ESG reporting, Indian standards cater to the specific context and priorities of the Indian business landscape. Both share common goals, such as transparency, stakeholder engagement, and integration of ESG considerations into business strategies. However, differences exist in reporting requirements, metrics, and materiality thresholds.

Convergence and the Path to Sustainable Corporate Practices: Achieving convergence between global and Indian standards is crucial for enhancing comparability and facilitating global benchmarking. Efforts are underway to bridge the gap and align Indian standards with international practices. The SEBI recognizes the significance of global frameworks like GRI and SASB in shaping Indian reporting practices. Many Indian companies voluntarily adopt the GRI Standards to ensure consistency and comparability with international peers. The NVGs also incorporate principles from global frameworks, providing guidance on ethical practices and responsible governance. Converging global and Indian standards will enable Indian companies to attract sustainable investments, gain access to global capital, and demonstrate their commitment to sustainable development. It will also facilitate cross-border comparability and assist investors in making informed decisions aligned with their ESG preferences.

I am summing up by saying, ESG reporting has become integral to corporate transparency and accountability worldwide. While global standards set the foundation, Indian standards address local contexts and priorities. Comparing and converging global and Indian standards for ESG reporting is essential for sustainable corporate practices. It will enhance transparency, comparability, and the integration of ESG factors into business strategies. The alignment of standards will empower companies to drive positive change, attract responsible investment, and contribute to the global sustainable development agenda.


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