CS Arti Ahuja Jewani & CS Hasti Vora – [2024] 163 taxmann.com 129 (Article)
In the modern corporate landscape, Environmental, Social, and Governance (ESG) criteria have become indispensable for evaluating a company’s sustainability and its impact on society. As stakeholders—ranging from investors to consumers—increasingly demand ethical and sustainable practices, companies face growing pressure to improve their ESG performance. This shift necessitates a strong governance framework, making the role of company secretaries more crucial than ever. Company secretaries are pivotal in embedding ESG principles into the corporate fabric, ensuring that companies comply with regulatory requirements and proactively engage in responsible business practices. Their expertise and oversight help companies navigate the complex landscape of ESG compliance, ultimately contributing to a more sustainable and ethical business model.
Understanding ESG Compliance
ESG compliance encompasses a broad spectrum of responsibilities, from ensuring environmental stewardship and social responsibility to maintaining robust governance practices. Company secretaries are pivotal in embedding these principles into the corporate ethos. They must ensure that the company adheres to relevant laws, regulations, and standards, and that it reports its ESG performance transparently and accurately.
Raining Disclosures & Framework
SEBI-mandated disclosure for listed entities in India1
From FY 2023 –2024, the top 1000 listed entities (by market capitalization) shall make disclosures as per the updated BRSR format as part of their Annual Reports.
Listed entities shall mandatorily undertake reasonable assurance of the BRSR Core, as per the glide path specified in the following table:
| Financial Year | Applicability of BRSR Core to top-listed entities (by market capitalization) |
| 2023-24 | Top 150 listed entities |
| 2024-25 | Top 250 listed entities |
| 2025-26 | Top 500 listed entities |
| 2026-27 | Top 1000 listed entities |
Prevailing Challenges
Some common challenges faced by Company Secretaries while ESG reporting include lack of standardization, data collection and quality, evolving regulatory requirements, balancing materiality & stakeholder expectations, integrating ESG into corporate strategy, addressing green washing concerns and more.
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