ESG Laws in India | Latest ESG Guidelines and Rregulations

Understand ESG laws in India, SEBI ESG reporting guidelines, and whether ESG reporting is mandatory. Explore ESG regulations, applicability, and standards.

Environmental, Social, and Governance (ESG) frameworks are rapidly reshaping the compliance and disclosure environment for companies in India. In a global economy driven by sustainability, the Indian legal ecosystem is witnessing a transformational shift with the introduction and implementation of ESG laws in India, spearheaded by regulators like SEBI.

ESG Laws in India

In this blog, we break down the ESG guidelines India, their reporting applicability, and answer key questions like “Is ESG reporting mandatory in India?” and “What are ESG regulations in India?”

📘 What Are ESG Regulations in India?

ESG regulations in India are a set of guidelines and frameworks introduced to ensure businesses report on their environmental, social, and governance impacts. These regulations promote transparency, responsible investing, and sustainable business practices.

The Securities and Exchange Board of India (SEBI) is at the forefront of this regulatory evolution, having introduced mandatory ESG reporting in India through frameworks like the Business Responsibility and Sustainability Report (BRSR).

🏛 SEBI Guidelines on ESG Reporting: The Backbone of ESG Laws in India

To streamline sustainability disclosures and align them with international best practices, SEBI has introduced a phased approach to ESG reporting:

✅ BRSR (Business Responsibility and Sustainability Reporting)

• Mandatory for the top 1000 listed companies by market capitalization.

• Replaced the previous Business Responsibility Report (BRR).

• Covers ESG-related disclosures across nine principles, aligned with the National Guidelines on Responsible Business Conduct (NGRBC).

✅ BRSR Core (Effective from FY 2023–24 onwards)

• A quantitative subset of BRSR indicators for assurance-based disclosures.

• Mandatory for the top 150 listed companies (expanding to 1000 in phases).

• Introduces reasonable assurance requirements for ESG disclosures.

These SEBI guidelines on ESG reporting form the regulatory foundation for ESG laws in India, making ESG not just a voluntary or ethical consideration – but a statutory obligation.

📌 Is ESG Reporting Mandatory in India?

Yes, ESG reporting is mandatory in India for a select group of listed entities. The key highlights are:

• BRSR is mandatory for the top 1000 listed companies from FY 2022–23 onwards.

• BRSR Core with assurance obligations applies to the top 150 listed companies from FY 2023–24.

• Other companies are encouraged to voluntarily adopt the BRSR framework.

Thus, ESG reporting applicability in India is currently scoped based on market capitalization but is expected to broaden in the future.

🌱 What Are the 4 Pillars of ESG?

While ESG is commonly seen as a tripartite framework, Indian regulators and global best practices are increasingly focusing on four operational pillars for practical compliance:

1. Environmental – Climate risk, energy efficiency, emissions, waste management.

2. Social – Human rights, labour practices, diversity, community impact.

3. Governance – Board oversight, ethics, executive compensation, risk controls.

4. Disclosure – Transparency, data quality, stakeholder communication.

🌍 What Are the Big Four ESG Standards?

To align ESG reporting with global benchmarks, Indian companies are increasingly referencing the big four ESG standards:

1. Global Reporting Initiative (GRI)

2. Sustainability Accounting Standards Board (SASB)

3. Task Force on Climate-related Financial Disclosures (TCFD)

4. Carbon Disclosure Project (CDP)

SEBI’s ESG guidelines in India aim to integrate aspects of these global standards through the BRSR Core indicators.

📊 ESG Reporting Guidelines in India: Practical Compliance Checklist

To comply with the ESG reporting guidelines in India, companies should:

• Identify ESG metrics under BRSR Core.

• Establish internal ESG data collection and validation protocols.

• Obtain third-party assurance where mandated.

• Communicate ESG risks and opportunities clearly in annual reports.

• Align with global ESG standards wherever feasible.

🔎 ESG Reporting in India: Challenges and Opportunities

While India’s ESG regime is still evolving, it offers both compliance challenges and strategic advantages:

Challenges:

• Lack of ESG reporting expertise

• Evolving assurance frameworks

• Integration with financial disclosures

Opportunities:

• Attract ESG-focused investors

• Strengthen risk management

• Enhance brand reputation and stakeholder trust

🧭 Concluding:

ESG laws in India represent a pivotal shift in corporate accountability and sustainable development. With SEBI guidelines on ESG reporting becoming more stringent, Indian companies must align ESG reporting not just for compliance, but for long-term value creation.

As regulators move from voluntary frameworks to mandatory ESG reporting in India, businesses that embed ESG principles today will be best positioned for tomorrow’s challenges – from capital access to reputational resilience.

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This content is for general informational purposes only and does not constitute legal advice.