Methodology

The research analysed sustainability disclosures from 300 listed companies in India across three financial years: FY2022–23, FY2023–24, and FY2024–25. This sample was designed to provide broad market representation, covering more than 76% of the total listed market capitalisation as of 31 March 2023. The selection parameters focused on quantitative and binary data across environmental, social, and governance core areas, aligned with the nine principles of the National Guidelines on Responsible Business Conduct (NGRBCs), to enable the measurement of tangible progress. The methodology also incorporated detailed individual interviews and roundtables with diverse industry stakeholders, including asset management firms, investors, and rating agencies.

Recommendations

The report provides recommendations across three key categories to improve reporting quality. For the Business Responsibility and Sustainability Reporting (BRSR) format, it is suggested that leadership and governance classifications be clarified to prevent distortion. Sector-sensitive interpretations of indicators are recommended, as metrics such as research and development (R&D) or product recalls are highly sector-dependent. Strengthening the robustness of assurance practices is also vital for improving data reliability for decision-makers.

Companies are encouraged to maintain consistent reporting boundaries and provide clear rationales for methodological shifts. Accuracy in intensity calculations should be improved by presenting base values alongside reported indicators. For the broader ecosystem, a focus on capacity building and better linkage between sustainability data and financial metrics is recommended. Under the guidance of the Securities and Exchange Board of India (SEBI), stakeholders should review data usefulness to avoid compliance fatigue and focus on forward-looking climate disclosures and transition planning.

Key findings

Standalone reporting remains dominant in India, used by 77.00% of companies in FY2022–23 and 76.25% in FY2024–25. Employee turnover stayed stable at approximately 21.2% in FY2024–25, though higher churn was noted in the Financials and Information Technology sectors. Regarding sustainable and safe goods, the percentage of companies not reporting R&D investment declined from 41% to 34%, although many firms reported zero investment. Capital expenditure (capex) in environmental technologies rose, with non-reporting declining to 27% by FY2024–25. Sustainable sourcing procedures were adopted by 79% of companies.

Energy reporting expanded, with renewable energy consumption disclosures rising from 224 to 252 companies. However, aggregate energy intensity increased from 0.06341 megajoules (MJ) per rupee of revenue in FY2022–23 to 0.06968 in FY2024–25, driven mainly by the Utilities and Materials sectors. Scope 1 and 2 emissions reporting remained high, with coverage increasing to 283 companies. Scope 3 reporting expanded from 114 to 153 companies, though coverage remains uneven across sectors. External assurance for Scope 1 and 2 emissions strengthened from 58% in FY2023–24 to 70% in FY2024–25, while Scope 3 assurance grew modestly to 50%. Value chain environmental assessments expanded from 74 to 121, and direct sourcing from MSMEs was reported by 267 companies. Product recalls remained low, and data breaches increased from 13 to 19 instances.

Important takeaways from stakeholder interactions

Stakeholders identified the standardisation of units and reporting boundaries as critical reform levers. Carbon and climate-transition data are expected to dominate future BRSR evolution. Investors currently view BRSR primarily as a risk management tool rather than a decisive alpha-generating input. There is a pragmatic expectation for data reliability, with asset managers prioritising directional consistency and progress over absolute precision. Integrating ESG data with financial analysis is essential; disclosures are most useful when clearly linked to financial performance and capital allocation decisions. Concerns were also raised regarding assurance quality and the need for more credible and independent providers.

Conclusion

India’s sustainability reporting ecosystem has progressed significantly under regulatory leadership. Since the introduction of the mandatory BRSR format, listed companies have made consistent improvements in disclosing useful information. However, standardisation and comparability remain the two key requirements for decision usefulness. Proposed reporting enhancements, such as increased granularity and clearer units of measurement, will be essential for the continued development of the sustainability ecosystem in India and its alignment with global reporting standards.