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The Securities and Exchange Board of India (SEBI) believes that ESG issues have become a priority issue, especially after the COVID-19 pandemic.

As stakeholders, regulators, investors, customers, employees and communities emphasize the importance of disclosing risks, practices and impacts, current SEBI guidelines mandate reporting of nine thematic ESG funds, called Business Responsibility and Sustainability Report (BRSR). Companies say this mandate goes beyond compliance and helps companies be more proactive in their business decisions. Contrary to popular belief, it resonates well with stakeholders and increases engagement. In the future, organizations will also interact and incorporate stakeholder perspectives into strategies.

According to India Brand Equity Foundation (IBEF), a foundation established by the Department of Commerce, Ministry of Commerce and Industry, Government of India, the total value of ESG funds under management in India was ₹9,753 crores (as of March 2024).

Wipro has used ESG guidelines to structure its framework on dual materiality, says Narayan PS, global head of sustainability and social initiatives, Wipro Limited. “It is a combination of (i) the impact of our business on our stakeholders and the environment and (ii) the reverse impact of environmental and stakeholder changes on our business. While the latter is captured in terms of risks and opportunities for the company, the impact of our business on the environment and stakeholders is considered through our materiality exercise and the implementation of our ESG objectives.”

The shift towards ESG and BRSR disclosures has indeed helped us build stakeholder transparency and engagement on risks and opportunities, says Aun Abdullah, head of ESG, Lodha Group, a real estate brand in Mumbai, “Our engagement ensures that our business model remains resilient and sustainable in a rapidly evolving global landscape. This shift also has broader implications for societal impact and value creation. We are actively engaging with our value chain partners and this collaborative approach ensures collective progress towards a more sustainable future,” she tells us.

ESG investing in India is being driven by three key factors: India’s commitment to achieve Net Zero by 2070, which would involve capital expenditure of $8-10 trillion over the next five decades. Added to this is SEBI’s introduction of BRSR disclosures and reporting; and the United Nations’ Sustainable Development Goals (SDGs), a benchmark for measuring a company’s market presence and ability to raise funds. Sustainability has, of course, become everyone’s responsibility.

Wipro currently has a 76% renewable energy (RE) footprint and an 80% reduction (from a 2017 baseline) in scope 1 and 2 emissions as of March 31, 2024. Over the last 10 years, its total energy consumption has been halved and nearly half a million tonnes of carbon dioxide emissions have been avoided. A central part of Lodha’s decarbonisation strategy is the Lodha Net Zero Urban Accelerator, an initiative driving transformational action across the real estate sector, and the RMI-Lodha Sustainability Conclave, which invites knowledge sharing across 40 industries. Palava City, an integrated greenfield smart city, and a 23-storey building with low-carbon materials are testament to the real estate group’s integrated sustainable solutions at scale.

“ESG gives companies like us the opportunity to see it as a strategic lever to drive sustainable growth,” says Amit Bhasin, Chief Legal Officer and Group General Counsel and Secretary, CSR Committee, Marico Limited. Marico generates 67.4% of its operational energy emissions from renewable sources. The share of renewable energy in its operational units has been increasing year-on-year, with the Jalgaon unit achieving 100% RE and 100% water neutrality.

With 2.8 MW of solar on-site, Colgate-Palmolive aims to transition to 100 percent renewable energy across all industrial facility operations by 2030, and to 100 percent reusable, recyclable, or compostable packaging. Shilpashree Muniswamappa, ESG & Communications Director, Colgate-Palmolive India, highlights how their ESG efforts have enabled them to achieve ESG Alpha. “Achieving net zero water status across three of our industrial facilities has enhanced our operational efficiency and resilience. This achievement not only saves critical resources, but also reduces operating costs and mitigates water scarcity risks, thereby contributing positively to our bottom line.”