PwC India Study Highlights Shift Towards Sustainability Reporting
In a significant stride towards Environmental, Social, and Governance (ESG) reporting, over half of India’s top 100 listed companies have voluntarily disclosed their Scope 3 emissions data for the fiscal year 2022-23, as revealed by a report from PwC India titled “Navigating India’s Transition to Sustainability Reporting.”
Scope 3 emissions, covering various upstream and downstream categories crucial to understanding a company’s net zero journey, have emerged as a focal point for businesses as they navigate the evolving landscape of sustainability reporting.
The report highlights that the adoption of the Business Responsibility and Sustainability Reporting (BRSR) framework, introduced by the Securities and Exchange Board of India (SEBI) in May 2021, marks a pivotal regulatory development in mainstreaming ESG practices across Indian businesses. Drawing references from globally recognized reporting frameworks such as the Global Reporting Initiative (GRI) and the Task Force on Climate-Related Financial Disclosures (TCFD), the BRSR framework has ushered in a more transparent and inclusive reporting ecosystem.
Sambitosh Mohapatra, Partner & Leader, ESG, PwC India, emphasized the growing importance of sustainability in boardroom discussions, stating, “ESG considerations have become key strategic priorities, reflecting enhanced awareness of sustainability and responsible business practices.”
Sumit Seth, a Chartered Accountant, echoed this sentiment, noting that the introduction of the BRSR signifies a shift towards a transparent and globally harmonized reporting framework, empowering stakeholders to make informed decisions about a company’s sustainability performance.
The study’s key highlights include the disclosure of Scope 3 data by 51% of the analyzed companies, with 44% conducting life-cycle assessments of their products or services. Additionally, 89% of companies disclosed information on leadership indicators, while 34% and 29% reported reductions in Scope 1 and Scope 2 emissions, respectively. Moreover, 49% of companies increased their energy consumption from renewable sources, with 31% disclosing net-zero targets.
The analysis further revealed that companies are adopting various initiatives to reduce their carbon footprint, including the transition to energy-efficient technologies, adoption of renewable energy sources, and implementation of carbon offsetting measures.
As India aims to achieve its net zero vision by 2070, the business sector is poised to play a critical role in realizing this ambition. The government’s and regulators’ efforts to introduce new ESG regulations position India as a frontrunner in the global transition towards a more credible and transparent sustainability reporting landscape.
The evolving ESG landscape underscores the imperative for companies to assess and enhance their existing ESG frameworks, processes, and data management mechanisms to ensure quality and consistency in reporting.