ESG in produce value chain

Understanding the BRSR Framework Established by SEBI

The Business Responsibility and Sustainability Reporting (BRSR) framework, established by the Securities and Exchange Board of India (SEBI). It represents a transformative shift. It alters how Indian corporates disclose their Environmental, Social, and Governance (ESG) activities. This is especially true for large manufacturers like cement factories, steel and metal industries, and thermal plants1 2 3.

What is the BRSR Framework?

The BRSR is a comprehensive reporting requirement. It applies to the top 1,000 listed entities in India by market capitalization. This requirement is mandated as part of their annual financial disclosures. This framework replaces the older Business Responsibility Report (BRR). It aligns India’s ESG reporting closer to leading global standards. These standards include the Global Reporting Initiative (GRI) and the Task Force on Climate-related Financial Disclosures (TCFD)1 2.

The BRSR framework is built around nine core principles. These principles are based on the National Guidelines for Responsible Business Conduct (NGRBC). They cover a spectrum of ESG topics, including environmental protection, respect for human rights, inclusive growth, and ethical business practices2 3.

Structure of BRSR Disclosures

BRSR disclosures are organized into three main sections:

General Disclosures: Company overview, business activities, structure, and compliance.
Management & Process Disclosures: Details on policies, risk management, ESG governance, and sustainability strategies.
Principle-wise Performance Disclosures: Quantitative and qualitative data mapped to each of the nine ESG principles2 4.

Within these sections, companies need to answer 140 questions—98 essential (mandatory) and 42 leadership (voluntary) indicators. Key environmental metrics now include energy mix (renewable vs non-renewable), water management, waste, emissions, resource efficiency, and sustainability goals1 5.

Introduction of BRSR Core and Value Chain Reporting

SEBI recognized the influence of large manufacturers on broader value chains. It introduced the BRSR Core subset. This subset focuses on Key Performance Indicators (KPIs) most relevant to Indian and emerging market contexts6 3. Critical updates include:

Mandating disclosure from both renewable and non-renewable energy sources.
Expanded water and waste management reporting.
Third-party assessment or assurance of data for greater credibility5 3.

Value Chain ESG Disclosures: From FY2025-26, companies must disclose ESG data from their main value chain partners. This disclosure covers 75% of total purchases/sales. It ensures that material upstream and downstream partners are included. These partners must represent 2% and above, by value. Assurance/assessment for these disclosures will be required from FY2026-27 onward3.

Importance for Heavy Industries: Cement, Steel, Metals, and Thermal Plants

For large manufacturers, especially resource- and emission-intensive sectors like cement, steel, metals, and thermal power:

High Environmental Impact: These sectors are significant contributors to India’s resource consumption, waste generation, and GHG emissions. BRSR mandates precise, comparable disclosure of energy use and emissions (GHG, air). It also requires reporting on water intensity, waste management, and circular economy practices. This forces accountability and innovation in sustainability5.
Regulatory Risk and Opportunity: Stricter reporting helps regulatory bodies, investors, and other stakeholders assess risks. It ensures compliance and identifies leaders and laggards in sustainable business practices7 3. For example, fly ash is now reused from coal thermal plants. This process is integrated into cement manufacturing. It is a reportable best practice for circularity and waste reduction8.
Value Chain Influence: BRSR disclosure requirements now extend to value chain partners. Manufacturers must assist suppliers in adopting responsible ESG practices. They should also guide customers in this effort. This will reduce reputational and operational risks.
Capital Market Access: Detailed BRSR reporting enhances a company’s profile with global investors. These investors are increasingly focused on ESG. This focus potentially affects access to capital and partnership opportunities9.

Illustration depicting various environmental, social, and governance (ESG) goals, featuring a diverse group of people, graphs, plants, and symbols representing sustainability and growth.

How BRSR Guides Corporates on ESG Goals

Standardized Measurement: Uniform metrics across essential ESG topics allow benchmarking within and across sectors.
Setting Goals and Tracking Performance: Companies are prompted to set sustainability goals. They report progress year-on-year. This practice enables internal improvements and external accountability10.
Assurance and Transparency: Independent, third-party assurance of disclosures improves reliability and credibility, building trust with stakeholders and regulators.
Facilitates Just Transition: Especially for sectors like power, cement, and steel, BRSR disclosures support “just transition” strategies. They balance climate action with social inclusion for workers and communities7.

Conclusion

The BRSR framework is a cornerstone of India’s ESG landscape. It pushes corporates and manufacturers—especially heavy industries—towards globally aligned reporting. This reporting is meaningful and transparent. SEBI focuses on the entire value chain. It implements phased coverage. This approach ensures the evolving needs of investors, regulators, and communities are met. It also allows companies time to build capacity for deeper sustainability practices and disclosures3 1 5.

Businesses that proactively embrace BRSR not only future-proof themselves against tightening global standards. They also foster resilience, stakeholder trust, and long-term value creation in a rapidly transitioning economy.