In the fiscal year 2022–2023, the top 500 publicly traded firms in India, which make up the NSE 500 index, produced 1.78 billion tonnes (Bt) of carbon dioxide equivalent (CO₂e) emissions. According to the analysis, Nifty 500 firms account for 45% of India’s carbon emissions. The World Bank estimates India’s total emissions in 2021 were 3.9 Bt CO₂e. The research emphasizes the business sector’s significant role, even when it accounts for a rise in overall emissions in 2023.

Devana Varshith, Team Lead at the public policy think tank Foundation for Democratic Reforms (FDR), conducted the study that led to this conclusion. The data clearly show that a significant portion of India’s emissions come from listed firms.

Manufacturing Sector Dominates Corporate Emissions

Forty per cent of the Nifty 500 firms are in the services industry, while sixty per cent are in manufacturing. The industrial sector accounts for an astounding 97.8% of all emissions from Nifty 500 businesses, while the service sector only contributes 2.2%. This means that the emissions share is far from proportionate.

Cement, iron, metals, electricity, oil and gas, and vehicles are among the industries within the manufacturing sector with the most significant emissions. Because these businesses’ operations are intrinsically energy-intensive, the research attributes this discrepancy to their “hard-to-abate” character.

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Reporting Practices Show Scope 3 Gaps

For 2022–2023, 415 of the 500 enterprises disclosed their Scope 1 and 2 emissions. Only 140 businesses, nevertheless, reported their Scope 3 emissions. Emissions that originate directly from sources that the business owns or controls, including boilers or furnaces, are referred to as Scope 1. Indirect emissions from power purchases are included in Scope 2. All additional indirect emissions across the value chain are covered under Scope 3.

Although many businesses have started accounting for emissions, the investigation found that gathering data on Scope 3 is still tricky. The intricate supply chains and the participation of several suppliers and distributors, especially Small and Medium Enterprises (SMEs), which frequently lack organized emissions tracking, are to blame.

Additionally, it was mentioned that more than 114 companies in the Nifty 500 had pledged to achieve net-zero goals before 2050. With more businesses embracing global norms and environmental goals, this change is viewed as encouraging. Nifty 500 firms account for 45% of India’s carbon emissions, making their role in climate targets crucial.

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