Surpassing the existing business reporting norms in India, the Securities and Exchange Board of India (SEBI) in its meeting held on March 25, 2021, conceived the Business Responsibility and Sustainability Reporting (BRSR). This form of report is aimed at helping Indian companies address issues that are gaining global importance such as climate change, inclusive growth, diversification of the workforce, and a sustainable environment and society.
The roots of BRSR go back to July 2011 when the Ministry of Corporate Affairs (MCA) recognized the need for companies to report on the measures undertaken from an Environmental, Social, and Governance (ESG) perspective. Below is the framework that will help clarify the basis of the BRSR:
As per the Committee’s recommendations, what was required was a ‘comprehensive format’ and a ‘lite version’. Here are what these standards aim to achieve:
On March 25, 2021, SEBI made the BRSR applicable to the top 1,000 listed companies. However, to enable companies all over India to smoothly transition to this framework, SEBI has allowed companies to voluntarily adopt it for FY 2021-22, but this will be mandated for each of these companies from FY 2022-23.
The Committee proposed two formats for the BRSR with separate guidance notes for each. They are known as the ‘BRSR Comprehensive’ which is aimed at the listed companies and has a much wider scope and ‘BRSR lite’ for the unlisted companies who wish to voluntarily adopt these standards. The structure of the new format is as follows:
The companies are required to disclose the basic details under this section. This includes factors such as the scale of the organization, its size, sector, products, employee strength, CSR activities, etc. Further, if the company has undertaken any activities to help the economy overcome an environmentally fragile situation and has worked for creating positive impacts in sensitive areas like protected zones, they should report it here.
The internal workings of the company, including its governance systems, policies procedures, and processes that the company has employed, will have to be disclosed in this section. This will help provide the beneficiaries of this reporting with a glimpse into the managerial infrastructure of the company.
Under this section, companies are required to report on how they have performed under the nine principles and the core elements of the NGRBCs. This entails effectively illustrating how the company will meet its commitment to responsible business conduct. This section is further divided into 2 categories:
The committee acknowledged that unlisted companies and other MSME organizations with no prior experience in non-financial reporting will not be able to meet the reporting requirements of the comprehensive BRSR framework. The committee thus proposed a framework called BRSR Lite, which has a different category of essential and leadership reporting. It has fewer elements than the comprehensive version and seeks information that these companies will be able to provide. This framework enables unlisted and MSME organizations to come within the ambit of those companies that carry out sustainability reporting and exemplify the impact that they are making.
Reporting about your company’s sustainability practices, whether it is mandatory or not, can have manifold benefits. It helps retain customers, grab eyeballs from potential investors, keeps existing shareholders' and employees’ content, and builds brand equity.
However, creating impactful reports requires a different set of expertise. Report Yak is a business reporting design agency that specializes in creating annual reports with compelling tailor-made designs. We conceptualize, create content, and design annual reports, ESG reports, and impact reports for organizations the world over.
Feel free to check out our award-winning work here, get in touch and we’d be happy to discuss your next report.
corporate reportingImpact Reports +5
environmental and social initiativesEnvironmental sustainability +5
sustainabilitysustainability report +2
annual reportintegrated report +4