Home Ministry of Corporate Affairs BRSR Core, ERP Guidelines, & ISSB Requirements

BRSR Core, ERP Guidelines, & ISSB Requirements

BRSR Core, ERP Guidelines, & ISSB Requirements

In July 2023, SEBI added new ESG metrics for necessary disclosure underneath ‘BRSR Core’ for sure listed corporations in India. The Enterprise Accountability and Sustainability Report (BRSR) format was initially launched in Could 2021 and changed the earlier Enterprise Accountability Report (BRR). Whereas SEBI has stipulated a timeline for necessary compliance underneath the BRSR Core, as of FY 2023, all the prime 1000 listed corporations by market cap in India should file their BRSR Report.

The Securities and Change Board of India (SEBI) requires the highest 1000 listed entities in India by market capitalization to make filings as per the Enterprise Accountability and Sustainability Report from FY 2023. It needs to be included of their Annual Reviews.

Additional, upon the suggestions of the ESG Advisory Committee and after conducting public consultations, the SEBI is implementing the ‘BRSR Core’ for assurance by particular listed entities. As well as, the Board has determined to introduce disclosures and assurance for the worth chain of listed entities, aligning with the rules set out within the BRSR Core.

What’s BRSR Core?

The BRSR Core represents a subset of the great BRSR and features a particular set of key efficiency indicators (KPIs) / metrics throughout 9 ESG attributes. With a concentrate on the Indian / rising market context, extra KPIs have been recognized for assurance, akin to job creation in small cities, enterprise openness, and gross wages paid to girls. To facilitate higher international comparability, depth ratios based mostly on income adjusted for buying energy parity (PPP) have been included.

To facilitate simple reference, the BRSR Core features a cross-reference to the disclosures discovered within the BRSR.

Instance of KPIs underneath BRSR Core and cross-reference to the BRSR

Sr. No.

ESG attribute


Cross-reference to the BRSR


Inexperienced-house gasoline (GHG) footprint


Greenhouse gasoline emissions could also be measured in accordance with the Greenhouse Gasoline Protocol: A Company Accounting and Reporting Commonplace

Complete Scope 1 emissions (Break-up of the GHG into CO2, CH4, N2O, HFCs, PFCs, SF6, NF3, if obtainable)

Precept 6, Query 7 of Important Indicators

Complete Scope 2 emissions (Break-up of the GHG (CO2e) into CO2, CH4, N2O, HFCs, PFCs, SF6, NF3, if obtainable)

Precept 6, Query 7 of Important Indicators

GHG Emission Depth (Scope 1 +2)

Precept 6, Query 7 of Important Indicators


Water footprint

Complete water consumption

Precept 6, Query 3 of Important Indicators

Water consumption depth

Precept 6, Query 3 of Important Indicators

Water Discharge by vacation spot and ranges of Therapy

Precept 6, Query 4 of Important Indicators


Vitality footprint

Complete power consumed


% of power consumed from renewable sources

Precept 6, Query 1 of Important Indicators

Vitality depth

Precept 6, Query 1 of Important Indicators


Embracing circularity – particulars associated to waste administration by the entity

Specified sorts of waste –  plastic, e-waste, bio-medical, building and demolition, battery, radioactive, different hazardous waste generated

Precept 6, Query 9 of Important Indicators

Complete waste generated

Precept 6, Query 9 of Important Indicators

Waste depth

Precept 6, Query 9 of Important Indicators

Every class of waste generated, whole waste recovered by way of recycling, re-using or different restoration operations

Precept 6, Query 9 of Important Indicators

For every class of waste generated, whole waste disposed by nature of disposal technique

Precept 6, Query 9 of Important Indicators


Enhancing Worker Wellbeing and Security

Spending on measures in the direction of wellbeing of workers and employees – value incurred as a % of whole income of the corporate

Precept 3, Query 1(c) of Important Indicators

Particulars of security associated incidents for workers and employees (together with contract-workforce e.g. employees within the firm’s building websites)

Precept 3, Query 11 of Important Indicators


Enabling Gender Variety in Enterprise

Complaints on POSH (sexual harassment)

Precept 5, Query 7 of Important Indicators

Gross wages paid to females as % of wages paid

Precept 5, Query 3(b) of Important Indicators


Enabling Inclusive Growth

Enter materials sourced from following sources as % of whole purchases – Straight sourced from MSMEs/ small producers and from inside India

Precept 8, Query 4 of Important Indicators

Job creation in smaller cities – Wages paid to individuals employed in smaller cities (everlasting or non-permanent /on contract) as % of whole wage value

Precept 8, Query 5 of Important Indicators


Equity in Partaking with Clients and Suppliers

Cases involving loss / breach of information of shoppers as a share of whole information breaches or cyber safety occasions

Precept 9, Query 7 of Important Indicators

Variety of days of accounts payable

Precept 1, Query 8 of Important Indicators


Open-ness of enterprise

Focus of purchases & gross sales performed with buying and selling homes, sellers, and associated events Loans and advances & investments with associated events

Precept 1, Query 9 of Important Indicators

Observe: For full data on attributes, parameters, measurement, information & assurance method, and cross-reference to the BRSR report, see Annexure-I of the SEBI Round.

Compliance timeline for BRSR Core

In its round issued July 12, 2023 (SEBI/HO/CFD/CFD-SEC-2/P/CIR/2023/122), the next timeline was supplied by SEBI the place the BRSR Core compliance will grow to be necessary for listed entities.

Monetary yr

Applicability of BRSR Core to prime listed entities (by market capitalization)


Prime 150 listed entities


Prime 250 listed entities


Prime 500 listed entities


Prime 1000 listed entities

Consequently, SEBI mandates the highest 150 listed corporations in India by market capitalization to supply “affordable assurance” on Environmental, Social, and Governance (ESG) metrics beginning FY 2023-24.

Multinational corporations in India are suggested to tread fastidiously on this regard as most areas on the forefront of ESG compliance, such because the European Union, solely require restricted assurance presently. By restricted assurance, it’s meant that auditors will be anticipated to depend on firm administration disclosures. Nevertheless, underneath SEBI’s course in India, the corporate’s auditors would want to verify the group’s ESG metrics and confirm its disclosures in opposition to precise protocols, efficiency, and requirements.

SEBI steering on assurance suppliers

The Board of the listed entity is answerable for guaranteeing that the reassurance supplier of the BRSR Core possesses the requisite experience to hold out affordable assurance.

The listed entity should assure the absence of any battle of curiosity with the reassurance supplier chosen to evaluate the BRSR Core. Particularly, it ought to be certain that the reassurance supplier and its associates don’t interact within the sale of their merchandise or supply any non-audit/non-assurance companies, together with consulting companies, to the listed entity or its group entities. This measure ensures independence and impartiality within the assurance course of, enhancing the credibility and reliability of the evaluation.

Up to date BRSR reporting format

For the comfort of customers, the format of the BRSR Core, which is topic to affordable assurance, is introduced in Annexure I (see right here) of the SEBI’s July 12, 2023 round. In the meantime, the BRSR format, encompassing the newly added KPIs of the BRSR Core, will be present in Annexure II (see right here). Consequently, the BRSR format as beforehand prescribed in Annexure 16 of the Grasp Round issued on July 11, 2023, has been revised to accommodate these updates.

ESG disclosures for worth chain

Within the Annual Report, listed corporations are required to reveal ESG-related data pertaining to their worth chain, following the rules set out within the BRSR Core. The worth chain ought to embody the principal upstream and downstream companions of the listed entity, which collectively account for 75 % of its purchases or gross sales (by worth).

For reporting functions, listed entities should current the KPIs outlined within the BRSR Core which might be related to their worth chain companions and attributed to their enterprise interactions with them. This reporting will be supplied individually for upstream and downstream companions or introduced in an aggregated format.

To make sure transparency and readability, the scope of reporting, in addition to any assumptions or estimations made, needs to be clearly disclosed within the report. This complete method will improve the understanding of the listed entity’s ESG efficiency and its affect on the worth chain.

ESG disclosures for the worth chain can be necessary (on a comply-or-explain foundation) for the highest 250 listed entities (by market capitalization) ranging from FY 2024-25. Firms falling underneath this class should adjust to the disclosure necessities. In distinctive instances the place compliance might not be possible, they’re required to supply a transparent rationalization for his or her resolution.

The restricted assurance of the above shall be relevant on a comply-or-explain foundation from FY 2025-26.

What’s BRSR?

By the Enterprise Accountability and Sustainability Report (BRSR) report, buyers are supplied with standardized data on an organization’s ESG parameters, thereby facilitating the identification and evaluation of sustainability-related dangers and alternatives for the enterprise and enabling better-informed funding choices.

The disclosures underneath BRSR (up to date format as effectively) are made underneath the next sections:

  • Part A: Common disclosures concerning the listed entity
  • Part B: Administration and course of disclosures
  • Part C: Precept-wise efficiency disclosure

The Nationwide Pointers for Accountable Enterprise Conduct (NGRBCs) as prescribed by the Ministry of Company Affairs (MCA) advocates 9 ideas as indicated within the desk under:

Ideas Guiding India’s Sustainability Reporting Beneath BRSR



Precept 1

Companies ought to conduct and govern themselves with integrity, and in a way that’s Moral, Clear and Accountable.

Precept 2

Companies ought to present items and companies in a way that’s sustainable and protected.

Precept 3

Companies ought to respect and promote the well-being of all workers, together with these of their worth chains.

Precept 4

Companies ought to respect the pursuits of and be aware of all its stakeholders.

Precept 5

Companies ought to respect and promote human rights.

Precept 6

Companies ought to respect and make efforts to guard and restore the surroundings.

Precept 7

Companies, when partaking in influencing public and regulatory coverage, ought to accomplish that in a way that’s accountable and clear.

Precept 8

Companies ought to promote inclusive development and equitable improvement.

Precept 9

Companies ought to interact with and supply worth to their shoppers in a accountable method.

Highlights of key disclosures associated to sustainability are indicated under:

  • A complete overview of the entity’s materials ESG (environmental, social, and governance) dangers and alternatives, together with their method to mitigating or adapting to those dangers, together with their monetary implications.
  • Disclosure of sustainability objectives, targets, and the entity’s efficiency in attaining them.
  • Setting-related disclosures masking useful resource utilization (power and water), air pollutant emissions, greenhouse gasoline (GHG) emissions, transition to a round economic system, waste technology and administration practices, biodiversity, and extra.
  • Social-related disclosures encompassing features associated to the workforce, worth chain, communities, and shoppers, akin to gender and social range amongst workers/employees, measures for differently-abled workers/employees, turnover charges, median wages, welfare advantages for everlasting and contractual workers/employees, occupational well being and security, coaching initiatives, Social Influence Assessments (SIA), Rehabilitation and Resettlement efforts, Company Social Accountability (CSR), and consumer-related features like product labeling, product recall, and shopper complaints pertaining to information privateness and cyber safety.

Entities already reporting sustainability data based mostly on internationally accepted frameworks like World Reporting Initiative (GRI), Sustainability Accounting Requirements Board (SASB), Job Power on Local weather-Associated Monetary Disclosures (TCFD), or Built-in Reporting (<IR>) can cross-reference their disclosures to align with the BRSR necessities.

Guidelines and rules for ESG rankings suppliers in India

Efficient from July 5, 2203, solely entities licensed by SEBI can be permitted to supply ESG ranking companies. See the Board’s Grasp Round issued July 12, 2023 right here.

To qualify for certification, the ESG ranking service supplier (ERPs) have to be included as an organization underneath the Firms Act, 2013, with specified ESG ranking exercise as the first goal in its Memorandum of Affiliation. If the ESG ranking supplier is related to or a subsidiary of a credit standing company, it should clearly distinguish ESG rankings from credit score rankings on its web site and ESG ranking reviews.

Enterprise mannequin

ERPs can comply with both of two enterprise fashions:

  • Subscriber-pays mannequin – the place the ESG ranking supplier derives its revenues from ESG rankings from subscribers like banks, insurance coverage corporations, pension funds, or the rated entity itself.
  • Issuer-pays mannequin – the place the ERP derives its revenues from ESG rankings from the rated entity, when it comes to a written contractual settlement between such entity and the ERP, which can comprise such provisions as specified by the SEBI.

Observe: To keep away from potential conflicts of curiosity, ERPs are required to chorus from adopting a hybrid enterprise mannequin. Particularly, an ERP shouldn’t assign sure ESG rankings based mostly on an issuer-pay mannequin whereas utilizing a subscriber-pays enterprise mannequin for different ESG rankings. This mandate ensures transparency and impartiality within the ESG ranking course of, selling belief and credibility within the rankings supplied by the ERP.

Audit paperwork

ESG ranking suppliers are obligated to submit all vital data and reviews to SEBI as per regulatory necessities. Moreover, they’re required to furnish monetary statements on the conclusion of every accounting interval. To make sure adherence to relevant legal guidelines, these suppliers should appoint a compliance officer answerable for monitoring compliance. Moreover, they need to keep books of accounts, information, and paperwork for a minimal interval of 5 years.


Licensed ranking businesses can be required to reveal their ranking methodologies for all ESG rankings on their web sites, whereas sustaining a steadiness between proprietary or confidential features of the methodologies. Moreover, they need to embody category-wise weightages of environmental, social, and governance components in ESG rankings, in addition to the weightage of high-level themes or key points inside every of the three components.

Merchandise provided by ESG ranking suppliers

As per CRA Rules, “environmental, social, and governance rankings” (ESG rankings) are ranking merchandise provided as opinions about an issuer or a safety’s ESG profile, traits, publicity to ESG danger, governance danger, social danger, climatic or environmental dangers, or affect on society, local weather, and the surroundings. These rankings are assigned utilizing an outlined rating system of ranking classes, no matter whether or not they’re explicitly labeled as “ESG rankings.”

An ERP should present the next ESG ranking merchandise at minimal:

  • ESG Ranking
  • Transition or Parivartan Rating
  • Mixed Rating
  • Core ESG Ranking
  • Core Transition or Parivartan Rating
  • Core Mixed Rating

The ESG Transition or Parivartan Rating evaluates the pace and magnitude of an organization’s efforts and investments in the direction of attaining Web Zero Targets and enhancing ESG danger administration. In essence, this rating displays the incremental modifications the corporate has undertaken in its transition journey in recent times, or the concrete plans and targets set to deal with the dangers and alternatives concerned in shifting in the direction of extra sustainable operations. Not like solely assessing their present profile, this rating considers the corporate’s progress and commitments to sustainability.

The Transition or Parivartan Rating might monitor modifications in quantitative metrics, akin to trend-lines or shifts in revenues generated from environmental/social companies and merchandise, or every other quantitative assessments based mostly on the ERP’s mannequin. This method permits for a complete analysis of the corporate’s sustainability efforts and encourages a forward-looking perspective in the direction of steady enchancment.

Guidelines for international ESG rankings suppliers

Even international businesses providing ESG ranking companies to entities in India might want to receive SEBI certification.

Additional, international ESG ranking suppliers searching for certification needs to be included in a jurisdiction that may be a member of the Monetary Motion Job Power (FATF) and acknowledged underneath their respective legal guidelines. They need to additionally possess a minimal of 5 years of expertise in offering ESG rankings of securities or corporations.

World efforts to enhance sustainability reporting and emphasis on ESG targets

Because the momentum behind sustainable improvement and the local weather change motion continues to construct, the worldwide panorama of sustainability reporting is quickly remodeling. This shift is primarily pushed by the growing calls for of buyers, who at the moment are pushing corporations to be extra clear and accountable for his or her sustainability efficiency. Consequently, reporting on environmental, social, and governance or ESG parameters has grow to be important for corporations to keep up a robust relationship with their stakeholders.

Over time, sustainability reporting frameworks have advanced, and corporations worldwide have embraced these frameworks to successfully measure, monitor, and disclose their efficiency in ESG areas. A number of the outstanding international ESG/sustainability disclosures and frameworks embody the GRI, <IR>, SASB, United Nations World Compact (UNGC), and CDP. Every of those frameworks outlines particular key efficiency indicators (KPIs) and ideas that corporations are required to speak in confidence to showcase their sustainability efforts.

Along with these international frameworks, ISO 26000 (Social Accountability Steering Commonplace) offers voluntary steering on social accountability, providing additional help for corporations searching for to include sustainable practices into their operations.

Many international locations the world over, like India, have additionally taken the initiative to introduce and mandate varied types of ESG-related disclosures, reinforcing the significance of sustainability reporting on a worldwide scale.

Inaugural international sustainability disclosure requirements from ISSB

On June 26, 2023, the Worldwide Sustainability Requirements Board (ISSB) marked a big milestone by releasing its inaugural requirements, IFRS S1 and IFRS S2. These Requirements set up a common language for disclosing the affect of climate-related dangers and alternatives on an organization’s prospects.

IFRS S1 units out complete disclosure necessities, permitting corporations to speak sustainability-related dangers and alternatives over the quick, medium, and long run to buyers. In the meantime, IFRS S2 focuses on particular climate-related disclosures, designed to enhance and be used along with IFRS S1.

Each Requirements totally incorporate the suggestions of the Job Power on Local weather-related Monetary Disclosures.



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