SEBI to Review ESG Disclosure Norms for Listed Companies

SEBI is preparing to revisit the ESG disclosure rules to ease compliance for listed companies.

The Securities and Exchange Board of India (SEBI) has announced its plan to re-evaluate current ESG (Environmental, Social, and Governance) reporting norms. This move comes after feedback from companies highlighting the challenges and burden of extensive disclosures.

ESG reporting has been mandatory for the top 1,000 listed companies since 2022–23. However, as per the previous directive, the top 250 companies were expected to cover 75% of their supply chains under sustainability reporting by 2025–26. Due to practical constraints, this deadline has been postponed.

SEBI’s Chairman, Tuhin Kanta Pandey, emphasized the need to build capacity for ESG compliance, especially among smaller firms that may struggle with existing requirements. He also reiterated India’s below-average global ESG score and the need for credible and effective disclosure frameworks.

Key Highlights:

SEBI will initiate a formal review of ESG norms starting next month.

The review aims to simplify requirements while ensuring transparency.

The regulator will explore a balanced regulatory approach instead of strict enforcement.

ESG norms could be revised in line with international standards and industry feedback.

This development is crucial for businesses to track, as future ESG reporting changes could directly impact regulatory compliance and investor relations.