The corporate sustainability landscape is significantly transforming with the new statement “Sebi ESG Rules: Stringent But In Right Direction” from the sustainability summit 2023. The Sebi ESG rules have garnered attention for their tough nature, prompting insightful discussions among India’s top sustainability executives at the Summit. While these regulations have posed challenges, experts concur that they represent a progressive stride towards aligning with global ESG standards.
Acknowledging the need for robust ESG standards, industry leaders have lauded Sebi’s initiative as a step in the right direction. However, some voices from the corporate sphere have pointed out that India Inc. might not have been fully prepared for the rigor of these regulations. Pradeep Panigrahi, the Head of Corporate Sustainability at L&T, emphasizes the importance of supporting companies navigating these new requirements. “A lot of handholding and knowledge sharing is required for the companies,” Panigrahi stated, underscoring the collaborative effort required for a successful transition.
Sebi’s mandate makes it obligatory for leading listed companies to comply with the new ESG rules starting this year. Companies such as ITC, which proactively embraced sustainability practices over the past decade, find themselves in a more advantageous position to adapt. ITC’s Vice President and Chief Sustainability Officer, Madhulika Sharma, noted that the company’s long-standing commitment to sustainability facilitated an easier alignment with Sebi’s standards. While acknowledging that other organizations may need time to acclimate to these regulations fully, Sharma emphasized that the endeavor signifies a promising beginning. “It’s a good start; there is intent,” she stated, emphasizing that transitioning to comprehensive ESG disclosures is an evolving process.
Enhancing Transparency and Uniformity
Sebi’s stringent ESG rules are set to revolutionize the landscape of corporate transparency, fostering uniformity in ESG disclosures across diverse industries. Sanjay Khajuria, Director of Corporate Affairs and Sustainability at Nestlé India, welcomes these stringent regulations as a catalyst for improved transparency. He views the regulations as a mechanism to enhance accountability, enabling companies to showcase their adherence to ethical practices. Moreover, the new disclosure standards usher in a valuable dimension of comparability, allowing stakeholders to gauge companies’ performances against industry peers.
The significance of science-based targets in ESG reporting is a sentiment echoed by Sanjeev Panchal, Country President and Managing Director of AstraZeneca Pharma India. Panchal asserts that establishing science-based targets aligns reporting with intrinsic organizational values, resulting in a more seamless and authentic disclosure process. Hetal Gandhi, Director of Research at CRISIL, affirms this stance, emphasizing that robustly substantiated data aligned with science-based targets effectively communicates an organization’s commitment to transparency. This alignment not only fulfills the expectations of international investors but also signifies an organization’s dedication to responsible practices.
In the fast-evolving landscape of ESG considerations, Sebi’s stringent rules undoubtedly present challenges for Indian corporations. However, these regulations are poised to foster a culture of enhanced transparency, accountability, and comparability. The collective journey towards aligning with global ESG standards is a testament to India Inc.’s commitment to sustainable growth. As the corporate landscape adapts, guided by Sebi’s regulations, the trajectory appears promising, reinforcing the belief that the path is right.
Overall, “Sebi ESG Rules: Stringent But In Right Direction” encapsulates a transformative phase for Indian corporations, encouraging them to stride purposefully toward a more sustainable and transparent future.