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BRSR - Every question you have -answered

Q) What are NGRBCs? The ministry of Corporate Affairs, Government of India issued a set of guidelines in 2011 called the National Voluntary Guidelines (NVGs). This was aimed at providing guidance on businesses on the social, environmental and economic aspects. In 2015, the NVGs were revised to align them with the Sustainable Development Goals (SDGs) and the “Respect” pillar of the United Nations Guiding Principles. After revision the new principles are called The National Guidelines on Responsible Business Conduct (NGRBCs)

The NGRBCs provide guidance on a wide range of issues related to responsible business conduct, including human rights, labour practices, environmental sustainability, anti-corruption, and transparent and accountable corporate governance.


Q) What is the basis for NGRBCs? The NGRBCs provide a framework for companies to assess their performance against responsible business practices, above and beyond regulatory compliances.

The NGRBCs capture the key national and international developments that have occurred since the release of the NVGs in 2011.

The key drivers of NGRBCs are:

· The UN Guiding Principles for Business and Human Rights’

· Paris Agreement on Climate Change (2015)

· Core Conventions 138 and 182 on Child Labour by the International Labour Organisation (ILO)

· Annual Business Responsibility Reports (ABRRs)

· Companies’ Act 2013


Q) How are NGRBCs and BRSR related? Business Responsibility and Sustainability Reporting (BRSR) refers to the practice of publicly disclosing information about a company's social and environmental performance, including its impact on stakeholders, governance and risk management processes, and sustainability goals and objectives based on the NGRBCs. This is mandatory for the top 1000 listed companies in India by market cap. It is expected that all businesses investing or operating in India, including foreign multinational corporations follow the NGRBCs and report their compliance in the BRSR format for disclosure.

(Reference SEBI Circular No. - PR No.18/2021 dated 10 May 2021)


Q) What should a company do to ensure BRSR compliance? To comply with BRSR, companies may follow these steps:

Familiarization with the BRSR framework and guidelines: Read the BRSR guidelines and regulations to understand the requirements and expectations of the standard.

Assess your current (As-Is) situation: Conduct a thorough assessment of your strategy, operations, and governance practices including your supply chain, products and services, to identify areas where you need to make changes to meet BRSR standards.

Develop a sustainability (ESG) strategy: Based on the results of your assessment, develop a sustainability /ESG strategy that outlines the steps you will take to meet BRSR standards.

Deploy the sustainability strategy: Put your sustainability strategy into action, making changes to your governance, operations and supply chain as necessary to meet BRSR standards.

Monitor and report on progress: Regularly monitor your progress towards meeting BRSR standards, and provide regular reports to stakeholders, including customers, employees, investors, and regulators.

Continuously improve: Regularly review and update your sustainability strategy and plan to ensure that you are meeting BRSR standards and making progress towards your sustainability goals.

It is important to seek the assistance of experts in sustainability and compliance if you need further guidance in meeting BRSR standards.


Q) What are the data requirements for BRSR compliance? On a broad level SEBI requires companies to disclose the following information in their BRSR reports:

ü Environmental and social impact of operations

ü Information on stakeholder engagement and materiality

ü Management approach towards sustainability

ü Details on energy consumption, greenhouse gas emissions, and water usage

ü Occupational health and safety practices

ü Community engagement and development activities

ü Diversity and equal opportunity policies

ü Business ethics and anti-corruption measures

ü Details on human rights and labour practices in the supply chain

ü Compliance with applicable laws and regulations

The specific data required for disclosure will depend on the company's size, sector, location, its impacts and dependencies as well as the sustainability reporting framework or standard used. However, some common data points that companies may be required to disclose include:

Environmental impact: Information about the company's greenhouse gas emissions, energy and water use, waste generation, and other environmental impacts.

Social impact: Information about the company's impact on employees, communities, and human rights, including information about working conditions, employee engagement, and diversity and inclusion.

Governance and risk management: Information about the company's governance structure, risk management processes, and internal controls.

Supply chain sustainability: Information about the sustainability practices of suppliers, including labour practices, environmental performance, and human rights.

Financial performance: Information about the company's financial performance, including revenue, expenses, and profit margins.

Stakeholder engagement and material issues: Information about the company's engagement with stakeholders, including customers, employees, suppliers, communities, and other key groups.

Sustainability goals and objectives: Information about the company's sustainability goals and objectives, including specific targets and progress towards meeting those targets.

It's important to note that not all companies will have data on all of these topics, and that some companies may report on additional data points that are specific to their industry or sector. However, the data disclosed should be relevant, material, and transparent, and should provide stakeholders with a clear understanding of the company's social and environmental performance


Q) How is the above data structured for reporting?

The BRSR consists of three sections, A, B, C, as detailed below:

1. Section A – General disclosures covering the operational, financial and ownership related information

2. Section B- Management and Process disclosures covering the structures, policies and processes to integrate the NGRBCs

3. Section C – Principle-wise performance indicators covering how well businesses are performing with respect to the NGRBCs.

Common sections that are typically included in Business Responsibility and Sustainability Reporting are:

  1. ESG Performance: Detailed information about the company's environmental, social, and governance performance, including data on emissions, resource usage, and labour practices.

  2. Stakeholder Engagement: Information about the company's engagement with key stakeholders, including employees, customers, suppliers, and communities.

  3. Material Issues: A description of the key sustainability issues facing the company, and how it is addressing these issues through its sustainability strategy and initiatives.

  4. Goals and Targets: Details of the company's sustainability goals and targets, as well as its progress in achieving these goals.

  5. Assurance and Verification: Information about the processes and procedures used to verify the accuracy and reliability of the sustainability information disclosed in the report.

  6. Future Priorities: A description of the company's future sustainability priorities and plans for continuing to improve its sustainability performance.

The above list is not exhaustive and some reports may include additional sections depending on the company's specific needs and reporting requirements.


Q) What can happen if an applicable company does not do BRSR compliance?

It's important for companies to comply with the requirements for BRSR maintain a positive reputation and relationship with stakeholders, in particular the regulatory authorities, investors and customers. Companies that fail to publish BRSRs may experience a loss of reputation, which can impact their business, brand image, and credibility.

Q) Which internal business functions is responsible for BRSR compliance?

Typically, the following individuals or departments are responsible for ensuring that the company complies with the BRSR and SR requirements:

Board of Directors: The Board of Directors has the overall responsibility for overseeing the company's CSR initiatives and ensuring that the company complies with the BRSR and SR requirements.

CSR Committee: Many companies have a CSR Committee, which is responsible for overseeing the company's CSR initiatives, including the preparation and publishing of the BRSR and SR.

Sustainability Department: Some companies have a dedicated Sustainability Department, which is responsible for managing the company's overall sustainability initiatives, including the preparation and publishing of the BRSR and SR.

Environmental, Social, and Governance (ESG) Teams: Some companies have ESG teams, which are responsible for ensuring that the company's operations are sustainable and socially responsible, and for preparing and publishing the SR.

HR Team: The HR team is responsible for implementing the employee related requirements of BRSR

The Ethics, Vigilance, and anti- corruption functions- They are responsible for ensuring the ethical practices across the entire value chain

External Auditors: External auditors may also play a role in ensuring that the company's BRSR is compliant with the relevant regulations and standards.

Ultimately, the responsibility for BRSR reporting in a company lies with the Board of Directors, who must ensure that the company complies with the requirements and that the reports accurately reflect the company's Sustainability initiatives and impact.

Q) Beyond BRSR - How can a company arrive at the right reporting framework for their sustainability efforts? The decision to adopt a sustainability framework depends on several factors, including the organization's goals, values, size, industry, and location. Here are some considerations that may help in choosing the right framework:

Purpose: Determine the primary objective of the sustainability initiative, such as reducing greenhouse gas emissions, improving social responsibility, or increasing resource efficiency.

Value alignment: Select a framework that aligns with the organization's values and priorities.

Industry-specific standards: Some industries have specific sustainability standards, such as the Global Reporting Initiative (GRI) for reporting sustainability performance or the Forest Stewardship Council (FSC) for responsible forest management.

Geography: Different frameworks may be more relevant in different countries or regions, depending on local regulations and cultural attitudes towards sustainability.

Size and complexity: Larger organizations may require more comprehensive frameworks, such as the, Global Reporting Initiative (GRI) standards, TCFD, ISO 26000, the Global Sustainable Development Goals (SDGs) or while smaller organizations may benefit from simpler frameworks like the Triple Bottom Line.

Stakeholder Mix: Consider the framework's ability to engage stakeholders and provide meaningful reporting and information.

Cost and feasibility: Evaluate the cost and resources required to implement and maintain the framework, as well as its compatibility with existing systems and processes.

It is important to note that sustainability frameworks are not a one-size-fits-all solution and that organizations may need to adapt or combine multiple frameworks to meet their specific sustainability needs.

Q) Where should a company publish their BRSR / sustainability reports? The sustainability report or BRSR disclosure can be integrated as part of the company’s Annual Report; alternatively, here are some domains where companies can upload their reports:

Company's Website / Microsite: Companies can upload their SRs on their official website, making it easily accessible to stakeholders, including investors, customers, employees, and the general public.

Stock Exchanges: Companies listed on stock exchanges are required to publish their SRs on the stock exchange website where they are listed. This helps ensure that the information is widely disseminated to investors and other stakeholders.

Ministry of Corporate Affairs (MCA) Portal: Companies can also upload their SRs on the Ministry of Corporate Affairs (MCA) Portal, which is the official portal for filing and accessing company-related information in India.

International Repository: Companies may also choose to upload their SRs on international sustainability reporting platforms, such as the Global Reporting Initiative (GRI) or the Sustainability Accounting Standards Board (SASB), to reach a wider audience.

It's important for companies to choose the appropriate platform(s) for uploading their SRs, based on their target audience and their reporting goals. The SR should be easily accessible to stakeholders and provide a clear and accurate picture of the company's sustainability initiatives and impact.


Q) Can a company be rated by external agencies basis of their BRSR / sustainability reports? Yes, a company can be rated on the basis of its sustainability report. There are several organizations and agencies that specialize in evaluating and rating the sustainability performance of companies. These organizations use a variety of methods, including qualitative assessments, quantitative data analysis, and peer review, to evaluate the sustainability performance of companies and provide them with a sustainability rating.

The most well-known sustainability rating organizations include:

  1. S&P Global / CRISIL: Provides sustainability ratings for companies based on their environmental, social, and governance performance.

  2. MSCI: Provides sustainability ratings for companies based on their exposure to sustainability risks and opportunities, as well as their management of ESG issues.

  3. CDP (formerly the Carbon Disclosure Project): Provides sustainability ratings for companies based on their disclosure of climate change-related information.

  4. ISS-Ethix: Provides sustainability ratings for companies based on their environmental, social, and governance performance, as well as their management of ESG risks and opportunities.

Sustainability ratings can be a useful tool for companies, as they can help to identify areas for improvement and provide a benchmark for their sustainability performance relative to their peers. Additionally, sustainability ratings can be used by investors and other stakeholders to make informed decisions about the companies they invest in or engage with.

It's important to note that sustainability ratings are not perfect, and that different rating organizations may use different methodologies, data sources, and criteria to evaluate the sustainability performance of companies. However, they can still provide valuable insights into a company's sustainability performance and help to drive improvements in sustainability practices.


Q) How can a company new to ESG create a core sustainability department? Creating a sustainability department in a company is a multi-step process that involves the following steps:

  1. Define the Purpose and Scope: Clearly define the purpose and scope of the sustainability department. Determine what the department will focus on, such as reducing the company's carbon footprint, reducing waste, or increasing energy efficiency.

  2. Get Executive Buy-In: Secure support from senior leadership to create a sustainability department. This will ensure that the department has the resources, budget, and support needed to succeed.

  3. Conduct a Company-Wide Assessment: Conduct an assessment of the company's current sustainability practices and identify areas for improvement. This will help you determine what resources and skills are required to create a sustainable future.

  4. Develop a Sustainability Strategy: Develop a comprehensive sustainability strategy that aligns with the company's business goals. The strategy should include clear objectives, milestones, and metrics to measure progress.

  5. Build a Team: Recruit and hire a team of experts to lead the sustainability efforts. The team should have a mix of individuals with experience in environmental science, engineering, sustainability management, and business.

  6. Establish Collaborative Relationships: Establish collaborative relationships with other departments within the company, as well as with external stakeholders, such as customers, suppliers, and NGOs.

  7. Implement Initiatives: Implement the initiatives outlined in the sustainability strategy. This could include reducing waste, increasing energy efficiency, and reducing greenhouse gas emissions.

  8. Monitor and Report Progress: Regularly monitor and report on the progress of the sustainability efforts. Use the metrics established in the sustainability strategy to measure progress and make necessary adjustments.

  9. Plan Do Check Act cycle: Continuously improve sustainability efforts by regularly reassessing the company's practices and incorporating new initiatives and technologies.

By following these steps, you can create a sustainability department that will help your company operate in a more sustainable and responsible manner.


Q) How can you find the right ESG partner for your requirements? When choosing an ESG (Environmental, Social, and Governance) partner, a company should consider the following factors:

Expertise: The consultant should have relevant expertise in ESG and sustainability reporting, as well as a deep understanding of the company's industry and sector.

Reputation: The consultant should have a good reputation for providing high-quality ESG and sustainability services, and should have a track record of working with other companies in similar industries.

Methodology: The consultant should have a clear and transparent methodology for ESG and sustainability reporting, and should be able to explain how they gather and analyse data.

Customization: The consultant should be able to provide customized services that meet the specific needs of the company, taking into account the company's size, sector, and location.

Independence: The consultant should be independent, impartial, and not have any conflicts of interest that could compromise the quality of their services.

Cost: The consultant should provide competitive pricing, and the company should carefully consider the cost of the services in relation to the value they will receive.

Communication and collaboration: The consultant should have excellent communication and collaboration skills, and should be able to work closely with the company to understand its ESG and sustainability reporting needs.

By considering these factors, a company can choose an ESG consultant that is well-suited to its needs and that can provide high-quality services that support its sustainability and responsible business practices.

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