New Delhi, India (CU)_ Industries that have focused on profitability now have the additional responsibility of reducing their carbon footprint and being socially responsible by implementing the Security Exchange Board of India’s (SEBI) standardized Environment Social Governance (ESG) framework this fiscal year. According to Dr. Rajeev Ranjan, director of the Center for Rural Outreach and advisor to the National Productivity Council, the framework introduced by the SEBI in 2021 was voluntary at the beginning. However, the Union Commerce Ministry made it compulsory for the nation’s top 1,000 listed companies in the current financial year. Accordingly, they will be given a rating, which will aid them in obtaining funds for their ventures.
In response to a question on whether sectors that do not comply with SEBI’s EGS framework will be punished, Dr. Ranjan stated that compliance should be mandatory. He said, “If there is an element of penalty involved, people will comply with the rules”. According to Dr. Ranjan, a former chief secretary of Tamil Nadu, the National Productivity Council, an autonomous organization under the Department for Promotion of Industry and Internal Trade, will host five workshops to educate the industry about the ESG framework, and the first of which will be held in Chennai.
According to Ranjan, India has vowed to reduce the carbon intensity of its economy by more than 45 percent by 2030. Training is being provided to assist the industry in comprehending how compliance works and the various obstacles encountered by companies in complying with the framework. Some businesses are energy-intensive or water-intensive, resulting in a significant carbon footprint. The emphasis will be on these industries adopting more effective carbon footprint-reduction technologies. According to him, companies in every industry may use such methods to boost their ratings.
In response to a question on how difficult it may be for Indian firms to execute the environmental, social, and governance ratings established by SEBI, Dr. Ranjan stated that the ESG standards framework is changing. He said, “The industries should realize that climate change is a reality and if they don’t comply, we all will face adverse climatic issues. Though there are challenges for the industries in complying with the guidelines the guidelines are evolving every now and then”. He stated that during the event, NPC specialists will assist businesses in completing the ESG framework forms and devise a strategy for its improvement.
