All-about the Mandatory Sustainability (ESG) Reporting
22nd March, 2023
CA. Chintan N. Patel
Covering
Why Sustainability
Sustainable Development, Goals and Objectives
Global Sustainability Standards
Reporting requirements in India and BRSR format specified by the SEBI
Information required
Way forward
Chintan N.
CA.
Patel
CA. Chintan N. Patel
Sustainable development is the development that meets the needs of the present without compromising the ability of future generations to meet their own needs.CA. Chintan N. Patel
CA. Chintan N. Patel
Objectives of Sustainable Reporting
Customer satisfaction and retention
Gain a competitive advantage
Provides accountability
Employee satisfaction and retention
Provide specific information instead of Greenwashing
Demonstrate Process
CA. Chintan N. Patel
Global Sustainability Standards
COP 26: ‘comprehensive global baseline’ of sustainability disclosures
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CA. Chintan N. Patel
SASB formed in 2011 ~ Value Reporting Foundation June 2021
ISSB - SASB Standards ~ IFRS Sustainability Disclosure Standards
77 Industry Standards
BRSR Requirement in India
• SEBI – mandates top 1,000 listed companies by Market capitalisation to have mandated BRSR for FY 2022-23
Why BRSR matters?
Business Responsibility
BRSR to be integrated with MCA filing
CA. Chintan N. Patel
Sustainability Index will be developed through information captured
BRSR Reporting
Section A - General Disclosures
Section B: Management and Process Disclosures
Section C: Principle wise Performance Disclosures
Details of the listed entity, products/services, operations, H/S/A
Markets served, employees related, representation of women
CSR details, transparency & disclosures compliances
Policy & management processes Governance, leadership & oversight
Essential indicators (Mandatory)
Leadership indicators (Voluntary)
Chintan N.
CA.
Patel
NGRBC: 9 Principles
P1: Businesses should conduct and govern themselves with integrity, and in a manner that is ethical, transparent and accountable.
P2: Businesses should provide goods and services in a manner that is sustainable and safe.
P3: Businesses should respect and promote the well-being of all employees, including those in their value chains.
P4: Businesses should respect the interests of and be responsive to all its stakeholders.
P5: Businesses should respect and promote human rights.
P6: Businesses should respect and make efforts to protect and restore the environment.
P7: Businesses, when engaging in influencing public and regulatory policy, should do so in a manner that is responsible and transparent.
P8: Businesses should promote inclusive growth and equitable development.
P9: Businesses should engage with and provide value to their consumers in a responsible manner.
CA. Chintan N. Patel
PRINCIPLE 1 Businesses should conduct and govern themselves with integrity, and in a manner that is Ethical, Transparent and Accountable.
Essential Indicators
Summary of Information required:
• Training and awareness programmes
• Details of fines / penalties /punishment/ award/ compounding fees/ settlement amount paid in proceedings (by the entity or by directors / KMPs) with regulators etc.
• Anti-corruption or anti-bribery policy and disciplinary action if taken by any law enforcement agency
• Complaints with regard to conflict of interest
• Process details of any corrective action or issues on corruption and conflict of interest
CA. Chintan N. Patel
PRINCIPLE 2 Businesses should provide goods and services in a manner that is sustainable and safe
Essential Indicators
Summary of Information required:
• % of R&D and Capex to improve environment and social impacts of products and process to Total
• Procedure for sustainable sourcing
• Reclaim of your products for reusing, recycling and disposing at the end of life
• Extended Producer Responsibility (EPR) applicability to entity
CA. Chintan N. Patel
Essential Indicators
Summary of Information required:
• Details of measures for the well-being of employees, workers
• Details of retirement benefits
• Accessibility of workplaces
• Equal opportunity Policy as per the Rights of Persons with Disabilities Act, 2016
• Return to work and Retention rates of permanent employees, workers that took parental leave
• Grievance mechanism –receive and redress
• Employees and worker membership in association/unions recognised by listed entity
• Training given on health and safety measures and skill upgradation
• Performance and career development reviews
• Health and safety management system
• Details of safety related incidents and measures taken
• Complaints by worker/employees on working conditions and health/safety related
• Assessment of health/safety and working conditions by third party and corrective actions
PRINCIPLE 3 Businesses should respect and promote the wellbeing of all employees, including those in their value chains
CA. Chintan N. Patel
PRINCIPLE 4: Businesses should respect the interests of and be responsive to all its stakeholders
Essential Indicators
Summary of Information required
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Processes for identifying key stakeholder groups of the entity
• List stakeholder groups identified and frequency of engagement with them CA. Chintan N. Patel
PRINCIPLE 5 Businesses should respect and promote human rights
Essential Indicators
Summary of Information required
• Training on human rights
• Minimum wages details
• Median remuneration/ salary/ wages – category-wise
• Human right issue addressing mechanism – focal point, redress, complaints
• Third party assessment of human rights compliances and corrective actions
Chintan N. Patel
CA.
PRINCIPLE 6: Businesses should respect and make efforts to protect and restore the environment
Essential Indicators
Summary of Information required
• Energy consumption and intensity
• Site/facilities if identified under the Performance, Achieve and Trade (PAT) Scheme of the Government of India
• Water – withdrawal and consumption
• Air emission details
• Greenhouse gas emission details
• Waste management
• Environmental impact assessment projects if any, compliance with environmental laws/regulations
CA. Chintan N. Patel
Essential Indicators
Summary of Information required
PRINCIPLE 7 Businesses, when engaging in influencing public and regulatory policy, should do so in a manner that is responsible and transparent •
Affiliations with trade and industry chambers/ associations • Corrective actions taken based on anticompetitive conduct by the entity, based on adverse orders from regulatory authorities CA. Chintan N. Patel
PRINCIPLE 8 Businesses should promote inclusive growth and equitable development
Essential Indicators
Summary of Information required
• Details of Social Impact Assessments (SIA) of projects
• Information on project(s) for which ongoing Rehabilitation and Resettlement (R&R)
• Grievances mechanism for community
• Input source from MSME/local suppliers
CA. Chintan N. Patel
PRINCIPLE 9
Businesses should engage with and provide value to their consumers in a responsible manner
Essential Indicators
Summary of Information required
• Consumer complaints and feedback
• Turnover relevant to environment, safe usage, recycling etc. to total turnover
• Product recalls if any
• Cyber security
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Corrective actions taken on actions by regulators relating to advertising, delivery of essential products, cyber security etc.
CA. Chintan N. Patel
Way Forward
Staff Awareness and training
Accuracy of information
Completeness
Multi-function co-ordination
SOP/Policies
Interaction with Suppliers, Management etc.
CA. Chintan N. Patel
CA Aanchal Kapoor 21 For More Information, Visit: https://taxmann.com/ Get in touch with us on Social Media: Follow us on Social Media: Download Taxmann App