The Sustainability Era

The current regulatory landscape is not only changing globally but its effects can be widely seen in India. In recent years, companies have increasingly focused on combating climate change and the need to be transparent and responsible in their business activities. This is evident through initiatives like Business Responsibility and Sustainable Reporting, or BRSR that has emerged as the primary instrument for disclosure of sustainable practices. This makes it important to have avail ESG consulting services to ensure your company is in tandem with the measures the regulatory bodies have rolled out. 

BRSR reporting is a framework mandated by SEBI for companies to evaluate and convey their adherence to sustainability standards and responsible business activities. It ensures that companies include non-financial disclosures in their annual report to represent transparent business operations. This reporting framework propels organizations in India to spot areas or processes where they can bring in improvement, assess non-financial business risks, and mitigate them to lower their impact on the environment. 

Rising Complexity of BRSR Reporting

BRSR reporting presents several challenges to businesses despite its importance in ensuring that companies are complying with the requirements of the National Guidelines for Responsible Business Conduct (NGRBC). Listed below are some of the challenges. 

Related Read: What Are the Implications and Strategies for BRSR Reporting in India?

  • Intricacies of Reporting: A thorough grasp of ESG standards, laws, and issues is necessary for BRSR reporting. It entails gathering and examining a huge volume of data from multiple sources.
  • Changing Nature: New concerns, guidelines, and laws are continually being introduced, resulting in a changing ESG landscape. It can be difficult for businesses to keep up with these shifts.
  • Resource Limitations: Many businesses, particularly small and medium-sized firms, lack sufficient funds or adequate knowledge to put BRSR reporting into practice.
  • Qualitative Information: As companies are more familiar with financial reporting and analyzing quantitative data, it can get difficult for them to adapt to reporting with qualitative data.
  • Data Interpretation: Companies can misinterpret their data which can lead to inaccurate reporting and that may pose a reputational risk. ESG data can be vast and understanding the same would require expertise in the field.
  • Tracking Performance: Companies may find it difficult to track their progress after adopting sustainable business practices as they may not have the adequate experience required to benchmark their performance against industry standards.

Stakeholders’ Concerns on ESG Reporting

The integration of sustainable measures in business activities requires a holistic approach that considers the involvement of all concerned stakeholders. Businesses need to implement changes that cater to the key stakeholders.

Investors – Increasing efficiency of business practices and mitigating risks 

Employees – Safety at the place of work and employee benefits in the organization 

Customers – High-quality products or services that provide value for money 

Regulators – Compliance with rules and regulations and transparency in processes 

Value Creation with ESG Consulting 

Businesses are now taking a keen interest in ESG leading to increased awareness about the regulations. However, to ensure complete adherence companies are looking for experts who are abreast with the latest developments on the technology and regulatory fronts. Let us discuss how specialized ESG consulting is now the need of the hour. 

  • Data Collection: Selecting metrics that apply to your business practices can be a challenging task as different metrics have different reporting boundaries.
  • Expert Advice: ESG consultants offer expert advice on ESG standards and regulations. They support businesses in comprehending the required information and explaining why it matters and guiding them on how to submit it.
  • Data management: ESG consultant supports gathering and analysis of ESG data. They assure companies that the information is trustworthy and accurate, and present in a way that stakeholders can understand.
  • Strategic Integration: ESG consultants assist in incorporating strategies into the business plan of the organization. They ensure that sustainability is an integral component of the business operations and strategic planning and not just an add-on.
     
  • Engagement of Stakeholders: ESG consultants assist companies in articulating data and conveying to stakeholders about their ESG performance in an efficient manner. They assist businesses in meaningfully interacting with stakeholders, creating a sense of trust.
  • Compliance and Risk Management: ESG consultants assist businesses in managing ESG risks and complying with ESG-related regulations. They enable businesses to avoid penalties and reputational damage.
  • Performance Tracking and Improvement: ESG experts can measure a business’ environmental, social, and governance (ESG) performance over time by comparing it to industry norms. They offer perceptions and suggestions for ongoing development. 

Specialized ESG Consulting Can Transform Your BRSR Reporting

Related Read: BRSR Reporting and Its Influence on Investor Decisions in India

The pressure on businesses to be fully transparent in their BRSR Reporting will only increase in the coming times. To be able to conform to compliance requirements while ensuring effective reporting, companies will need a roadmap of actions. An ESG consultant will not just assist with preparing an action plan but will also put sustainability at the core of their value proposition. 

Reporting the correct data: ESG consulting can aid organizations in accurately capturing and disclosing key data points for their BRSR reports. Consultants guide clients through complicated reporting obligations with attention to detail ensuring transparency. 

Identification of material data: ESG consultants are experts in conducting in-depth analysis and identifying material data for BRSR reporting. Using this data, companies can focus on measures that are meaningful to stakeholders and investors by identifying the most relevant environmental, social, and governance (ESG) concerns. 

Suggesting best practices to reduce ESG footprint: ESG consultants identify risks in business processes that may contribute to reputational damage. They provide relevant recommendations and suggest risk mitigation strategies to minimize negative impacts. 

Aligning them to sustainability goals: Specialized ESG consulting can assist organizations in aligning reporting efforts with their sustainability objectives. Consultants work closely with companies to develop tailored strategies that include integrating ESG principles into core business operations. This is a crucial factor in developing a culture of sustainability throughout the organization. 

Collates scattered data across branches: Streamlining BRSR reporting by centralizing scattered data across multiple branches or divisions is the first step. By implementing efficient data management systems and by developing customized templates, consultants assist businesses in overcoming challenges and ensuring consistency in their reporting practices. 

Conclusion

Businesses can achieve top-line growth by hiring ESG experts. They provide insights into ongoing business practices suggesting improvements and aligning them with the company’s overall sustainability goals. Companies can thus broaden their market presence by offering sustainable products or services to B2B or B2C customers. As organizations continue to recognize the role of ESG in shaping and driving their business practices, the demand for specialized ESG consulting services is set to grow providing a sustainable and responsible future for companies across the world. 

Why Choose InCorp Advisory?

BRSR Reporting can be a difficult task given its ever-changing nature. Our ESG experts have in-depth experience in managing all your BRSR-related requirements and projects. We have experience working for businesses across various sectors and stages. To learn more about BRSR Reporting or ESG services, you can write to us at info@incorpadvisory.in or reach out to us at (+91) 77380 66622.

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