SEBI – Chasing Tales

The Business Responsibility and Sustainability Reporting (BRSR) is India’s most significant regulatory intervention in the domain of Environmental, Social, and Governance (ESG) disclosures. Introduced by the Securities and Exchange Board of India (SEBI) as the successor to the Business Responsibility Report (BRR), the BRSR mandates that the top 1,000 listed companies by market capitalisation submit structured, principle-based ESG disclosures as part of their annual reports. The framework is anchored in the National Guidelines on Responsible Business Conduct (NGRBC), issued by the Ministry of Corporate Affairs (MCA) in 2019. The NGRBC itself replaced the earlier National Voluntary Guidelines (NVGs) of 2011.

Before we go ahead, here’s a brief map:

BRSR: This is the framework.
BRSR Core: This is a subset of the framework
Industry Standards: This is an interpretation guide.
Assurance/Assessment: How the reports are verified.
Value Chain Disclosures: The expansion.

History¹
India’s journey toward structured sustainability reporting began formally with the Business Responsibility Report (BRR), introduced under Regulation 34(2)(f) of the SEBI LODR Regulations, 2015. Initially applicable to the top 100 listed companies by market capitalisation from FY2013–14, the BRR was an attempt to institutionalise non-financial disclosures within the mainstream corporate reporting ecosystem.

However, the BRR had structural limitations that became increasingly apparent as the global ESG discourse matured:

The reporting format was largely narrative and open-ended, allowing considerable interpretive latitude that undermined comparability
There were no standardized quantitative metrics, making cross-company and cross-sector benchmarking virtually impossible
The framework had no third-party assurance requirements, leaving disclosures entirely self-declared and unverified
Coverage was limited to just 100 companies, leaving the vast majority of the Indian listed market outside the reporting ambit
The framework did not adequately reflect global developments such as the Paris Agreement, the UN Sustainable Development Goals (SDGs), or the rise of formal ESG investing frameworks

In May 2021, SEBI issued a notification amending the LODR Regulations, formally announcing the discontinuation of the BRR and its replacement with the Business Responsibility and Sustainability Reporting (BRSR) framework. The transition was planned in a phased manner to allow companies adequate time to build institutional capacity:

FY2021–22: Voluntary phase — the top 1,000 listed companies were encouraged, but not required, to adopt BRSR
FY2022–23 onwards: Mandatory phase — BRSR became a compulsory annual disclosure obligation for the same cohort

Who Must File?² ³
Under the amended LODR Regulations, the top 1,000 listed entities by market capitalisation are required to submit BRSR annually, starting from FY2022–23. The list of applicable companies is determined based on market capitalisation as of March 31 of the preceding financial year, introducing a dynamic element — companies moving in and out of the top 1,000 threshold will correspondingly enter or exit the mandatory disclosure obligation.

For FY2025–26, SEBI has reiterated that the top 1,000 listed entities by market capitalization remain obligated to file BRSR, with top 500 listed entities specifically required to obtain assessment or assurance of BRSR Core disclosures.

Unlisted companies are not currently required to file BRSR, regardless of size, unless they are captured within the consolidated reporting boundary of a listed parent
Subsidiaries of listed companies may be included within the reporting boundary if the parent opts for consolidated reporting
SME-listed entities are currently excluded, though SEBI has indicated potential future expansion
Foreign subsidiaries of Indian listed companies may be included or excluded based on the parent’s chosen reporting boundary

Filing Mechanisms⁴ ⁵
The BRSR must be filed as part of the annual report submitted to stock exchanges — typically by June 30, within three months of the financial year-end. Filing must be done in XBRL (eXtensible Business Reporting Language) format on the exchange portals (NSE/BSE NEAPS platforms), along with a PDF version for public viewing.

Structure⁶ ⁷ ⁸
The BRSR framework is organised into three sections:

Section A: General Disclosures
Section A establishes the organisational context within which all subsequent disclosures must be read. It functions as the foundational layer. Key disclosures include:

Company details: Name, Corporate Identification Number (CIN), registered office address, website, stock exchange listings, and the contact details of the BRSR designated officer — a requirement that enhances accountability by attaching a human name to the disclosure
Reporting boundary: Whether the report is prepared on a standalone or consolidated basis, and a clear explanation of what is included or excluded from scope
Business activities: Products and services contributing to 90% of the company’s turnover, along with individual percentage contributions — providing investors a clear map of what the company actually does
Markets served: Domestic and international presence, including export revenue as a percentage of total revenue
Employee and worker data: Total headcount broken down by permanent/temporary/contractual categories, gender diversity at the board and Key Management Personnel (KMP) level, and employee turnover trends across three financial years — providing a longitudinal view of workforce dynamics
CSR activities: A summary of Corporate Social Responsibility (CSR) initiatives and spending, though specific expenditure percentages are no longer separately required under BRSR, as they are captured in the Companies Act disclosures
Complaints and grievances: Any received on matters of responsible business conduct, including status of resolution

Section B: Management and Process Disclosures
This is the governance layer. Disclosures include:

Board oversight of ESG: Whether the board has a dedicated committee for sustainability, how frequently ESG topics appear on the board agenda, and whether a director has been designated as the responsible signatory for BRSR
Policies and frameworks: The existence, scope, and public availability of policies on human rights, labor standards, environmental protection, anti-corruption, data privacy, and other relevant domains — including whether these policies extend to value chain partners
Risk management integration: Whether ESG risks are formally integrated into the company’s Enterprise Risk Management (ERM) framework — a critical indicator of institutional maturity, as companies that treat ESG as separate from mainstream risk management are typically further behind in their sustainability journey
Stakeholder engagement: Formal mechanisms for identifying, mapping, and engaging with material stakeholders — employees, communities, suppliers, customers, investors, regulators, and civil society — including frequency and outcomes of engagement
Training and awareness programs: Details of training conducted on responsible business conduct across employee and worker categories
Grievance redressal mechanisms: Internal and external channels available to stakeholders to report concerns, and the effectiveness of these mechanisms

Section C: Principle-wise Performance Disclosures
Structured around the nine principles of NGRBC, it comprises both qualitative narratives and quantitative data points expressed in standardised units (kWh, tonnes of CO₂e, kiloliters, etc.). Each principle contains Essential Indicators (mandatory, 98) and Leadership Indicators (voluntary, 42). The tiered structure is strategically important for sectors with vastly different ESG profiles. A coal mining company and a software services firm face fundamentally different materiality landscapes; the essential indicators ensure a universal baseline while leadership indicators allow sector-specific differentiation.

The nine principles of the National Guidelines on Responsible Business Conduct (NGRBC)⁹ ¹⁰
Table:

#	Full NGRBC Statement
P1	Businesses should conduct and govern themselves with integrity, and in a manner that is ethical, transparent, and accountable
P2	Businesses should provide goods and services in a manner that is sustainable and safe
P3	Businesses should respect and promote the well-being of all employees, including those in their value chains
P4	Businesses should respect the interests of and be responsive to all their stakeholders
P5	Businesses should respect and promote human rights
P6	Businesses should respect and make efforts to protect and restore the environment
P7	Businesses, when engaging in influencing public and regulatory policy, should do so in a manner that is responsible and transparent
P8	Businesses should promote inclusive growth and equitable development
P9	Businesses should engage with and provide value to their consumers in a responsible manner

No principle can be reported on in isolation — SEBI and MCA both emphasize that they are interdependent, interrelated, and must be addressed holistically across a company’s operations and value chain.
Environmental disclosures are concentrated almost entirely in P6. Social obligations are distributed across P3, P4, P5, P8, and P9. Governance is embedded in P1, P7, and cuts across all nine through the Section B process disclosures.
Essential Indicators constitute the mandatory minimum disclosure requirement. These indicators are designed to be measurable, standardized, and verifiable, reducing the scope for narrative manipulation or selective disclosure.
Leadership Indicators represent best-practice and advanced-stage sustainability performance. They allow genuine sustainability leaders to differentiate themselves meaningfully from laggards, and they function as a forward-looking indicator of regulatory direction.

While Section C establishes the full ESG performance architecture, SEBI later identified a narrower subset of metrics that investors consistently relied upon — this became BRSR Core.

BRSR Core¹¹ ¹²
In July 2023, SEBI introduced the BRSR Core which is a focused subset of the most material, investor-relevant, and comparable ESG indicators within the broader BRSR. The BRSR Core comprises nine Key Performance Indicators (KPIs) organized across three ESG domains:

Environmental KPIs:

GHG Footprint (Scope 1 and 2 emissions, with PPP-adjusted intensity ratios)
Water Footprint (consumption and intensity)
Energy Footprint (consumption and intensity)
Waste Management (generation, recycling, disposal ratios)

Social KPIs:

Employee Well-Being and Safety (health benefits, accident rates, training metrics)
Gender Diversity in Business (gender representation across levels, pay gap disclosures, POSH complaints)
Enabling Inclusive Development (MSME procurement percentages, local sourcing)

Governance KPIs:

Fairness in Engaging with Customers and Suppliers (cybersecurity incidents, data privacy compliance, supplier payment terms)
Open-ness of Business (corporate governance disclosures, financial transparency indicators)

New KPIs introduced through March 2025 amendments include: job creation in small towns, openness of business metrics, and gross wages paid to women — reflecting SEBI’s intent to deepen the social dimension of BRSR Core.

The BRSR Core is not being rolled out uniformly across all 1,000 companies simultaneously. SEBI has adopted a company-size-stratified phased approach:

Financial Year	BRSR Core Applicability
FY 2023–24	Top 150 listed entities by market cap
FY 2024–25	Top 250 listed entities
FY 2025–26	Top 500 listed entities
FY 2026–27	Top 1,000 listed entities

This graduated expansion gives smaller companies within the top 1,000 additional preparation time while ensuring that the largest, most systemically important companies are subject to the most rigorous standards first.

Value Chain ESG Disclosures⁵ ¹² ¹³
SEBI recognises that for many industries, Scope 3 emissions (those embedded in purchased goods, logistics, and sold products) can represent 70–90% of total carbon footprint; excluding the value chain from sustainability reporting would render BRSR’s environmental data structurally incomplete. However, to ease implementation timelines, SEBI significantly revised the value chain disclosure framework through its March 28, 2025 circular, because many small and mid-size suppliers in Indian value chains are not yet equipped for formal ESG data reporting.

The value chain definition now explicitly covers upstream and downstream partners that individually contribute at least 2% of the listed entity’s total purchases or sales by value — a more precise and operationally workable threshold than the earlier reference to “top 10 suppliers and customers”
Companies may limit aggregate disclosures to partners covering 75% of total purchases and sales, providing a practical ceiling that prevents the exercise from becoming an administrative marathon
The applicable timeline is:

Financial Year	Value Chain Disclosure Requirement
FY 2025–26	Voluntary ESG disclosures for top 250 entities; prior year data voluntary
FY 2026–27	Voluntary assessment or assurance on value chain ESG disclosures

The shift from a comply-or-explain to a voluntary approach for FY2025–26 reflects SEBI’s responsiveness to industry feedback about implementation readiness — many small and mid-size suppliers in Indian value chains are not yet equipped for formal ESG data reporting.

Assurance Requirements¹²
When BRSR Core was introduced in July 2023, SEBI mandated reasonable assurance on BRSR Core disclosures in a phased manner. Reasonable assurance — the highest standard of verification in auditing practice — was considered the gold standard for ESG credibility, but proved operationally challenging given the nascent state of sustainability auditing in India.

In response to an Expert Committee recommendation, SEBI made a significant policy adjustment: through the March 2025 circular, the term “assurance” was replaced with “assessment or assurance” for BRSR Core verification. It means listed entities can now choose between:

Formal Assurance: Conducted by chartered accountants or statutory auditors following established auditing standards, providing a high degree of confidence in data accuracy
Assessment: A broader, potentially profession-agnostic verification process developed per standards by the Industry Standards Forum (ISF) in consultation with SEBI — designed to reduce compliance costs and open the market to qualified non-auditor sustainability practitioners

SEBI has specified that assessors and assurers must meet independence requirements — they cannot be entities that sell products to or offer consulting services to the reporting company.

The scope of assessment or assurance covers:

Accuracy of data reported in BRSR Core KPIs
Completeness of disclosures — are all required data points present?
Consistency with source documents — does reported data align with underlying records?
Compliance with BRSR format — are prescribed units, taxonomies, and templates used correctly?

Industry Standards on BRSR Core²
The December 20, 2024 circular introduced the Industry Standards on Reporting of BRSR Core, developed by the Industry Standards Forum (ISF) — a joint initiative of ASSOCHAM, FICCI, and CII (India’s three premier industry bodies). These standards are not legally binding but are strongly recommended by SEBI and are expected to become the de facto interpretation guide for listed entities and their assurance providers.

Key Provisions:

PPP-Adjusted Intensity Ratios: Companies must report environmental intensity metrics (GHG, energy, water, waste) per unit of revenue, with revenue figures adjusted for Purchasing Power Parity (PPP) using the latest IMF-published conversion rate for India. The same PPP rate must be applied consistently to both the current and prior year comparatives — preventing companies from manipulating apparent year-over-year improvement by switching conversion rates. This PPP adjustment is intended to facilitate meaningful comparison between Indian companies and global peers on investor dashboards.
Output-Based Intensity for Manufacturing: For manufacturing entities, output-based intensity ratios (e.g., tonnes of CO₂e per tonne of production) are required alongside revenue-based metrics. Service entities use Full-Time Equivalents (FTEs) as their input measure. This dual approach acknowledges that revenue-based intensity can be distorted by price fluctuations — a company’s emissions profile doesn’t change just because commodity prices spiked.
Spend-Based Estimation: Where primary measurement data is unavailable for emissions, energy, or water consumption, companies may temporarily use a spend-based approach — estimating environmental footprints based on annual expenditure data and published emission/consumption factors. This provides an entry point for smaller or less-instrumented companies while setting expectations that primary measurement will be established over time.
Greenhouse Gas Emission Factors: For Scope 2 emissions from purchased electricity, companies must use the latest grid emission factor published by the Central Electricity Authority (CEA). Companies using renewable energy certificates (RECs) or power purchase agreements (PPAs) for green power must clearly specify the accounting methodology.
Attribute-wise Technical Clarifications: The standards provide detailed technical guidance on each of the nine BRSR Core attributes.
Global Framework Alignment: The Industry Standards explicitly reference GRI (Global Reporting Initiative), SASB (Sustainability Accounting Standards Board), and TCFD (Task Force on Climate-related Financial Disclosures), establishing conceptual bridges between BRSR and the global sustainability reporting landscape. Companies that already report under these frameworks can leverage their existing infrastructure rather than building parallel reporting systems.

Common Reporting Errors¹³
In May 2024, SEBI’s Expert Committee issued a report identifying systemic quality failures in BRSR submissions. The most frequently identified problems included:

Incorrect units: Reporting energy consumption in megawatts (a measure of power capacity) instead of kilowatt-hours (a measure of energy consumed) — a fundamental error that renders the data meaningless
Mathematical inconsistencies: Reporting waste recovered as greater than total waste generated — an arithmetically impossible outcome that signals either poor data governance or deliberate inflation of recycling figures
Unexplained zero disclosures: Reporting zero renewable energy without explanation, particularly for large industrial companies where this is implausible
Headcount mismatches: Total employees reported differently across different sections of the same report — suggesting that data is being pulled from multiple, unreconciled sources
Training overreporting: Training hours provided to more workers than the company’s total worker strength — again, an arithmetically impossible outcome
Poor quality environmental data under Principle 6: Generic, unsubstantiated figures for energy and emissions that are clearly not grounded in actual metering or operational data

SEBI’s response to these failures was to require:

Internal verification protocols before submission, with the responsible director confirming accuracy
Consistent use of prescribed units throughout the report
Cross-referencing of BRSR data with corresponding data in audited financial statements and directors’ reports
Documented explanations for any “Not Applicable” responses — a blanket N/A without justification is no longer acceptable

Cross-Referencing with Global ESG Frameworks²
Companies that already produce GRI- or TCFD-aligned reports — typically multinationals or companies with significant international investor bases — can provide a mapping table (cross-walk) showing how their existing disclosures satisfy BRSR requirements. This avoids duplication of effort and leverages existing reporting infrastructure.

It’s also important because with the alphabet soup of sustainability reports plaguing ESG reporting, it’s the right step to not view BRSR as a competing or isolated framework but as part of a convergent global sustainability reporting architecture.

Final points:

BRSR is less about sustainability storytelling and more about data discipline.
And discipline, in capital markets, compounds.
BRSR positions India as one of the few emerging markets with regulator-mandated ESG reporting, ahead of many developed jurisdictions in structured ESG disclosures.

Sources

Tag: SEBI

SEBI BRSR Explainer

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