Business Responsibility and Sustainability Report – UPSC Prelims

Business Responsibility and Sustainability Report(BRSR):
  • It is a new reporting requirement by SEBI for the top 1000 listed companies.
  • BRSR is a significant step towards bringing sustainability reporting at par with financial reporting.
  • Sustainable Reporting is the disclosure and communication of environmental, social, and governance(ESG) goals. It also includes the company’s progress towards ESG goals.
  • Objective: The BRSR report will encourage businesses to go beyond regulatory financial compliance. It will make businesses to report on their social and environmental impacts.
  • As part of the annual BRSR report, companies will need to provide
    • An overview of their ESG
    • The risks and opportunities associated with the ESG
    • Approach to mitigate or adapt to the risks along with financial implications.
  • Applicability:
    • BRSR will be applicable to the top 1000 listed entities (by market capitalization).
    • The report will be a voluntary one for FY 2021-22 and a mandatory one from FY 2022-23.
What Are Environmental, Social, and Governance(ESG) Criteria?
  • Environmental, Social, and Governance(ESG) criteria are a set of standards for a company’s operations. The standards will help socially conscious investors to screen potential investments.
  • Environmental criteria consider how a company performs as a steward of nature.
  • Social criteria examine how it manages relationships with its employees, suppliers, customers and the communities where it operates.
  • Governance deals with a company’s leadership, executive pay, audits, internal controls, and shareholder rights.
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