SEBI issued the circular regarding Measures to facilitate ease of doing business with respect to framework for assurance or assessment, ESG disclosures for value chain, and introduction of voluntary disclosure on green credits.
The following has been stated
Green Credits
In Principle 6 of BRSR, provided under Annexure 16 of the aforementioned master circular, an additional leadership indicator (i.e. an eighth leadership indicator) shall be included seeking disclosures on green credits in the following format –
“8. How many Green Credits have been generated or procured: a. By the listed entity b. By the top ten (in terms of value of purchases and sales, respectively) value chain partners
The provisions under this Section shall be applicable for BRSR disclosures for FY 2024-25 and onwards.
Assessment or Assurance
The BRSR Core consists of Key Performance Indicators (KPIs) under 9 ESG attributes.New KPIs include job creation in small towns, openness of business, gross wages paid to women, etc.For global comparability, intensity ratios based on revenue adjusted for Purchasing Power Parity (PPP) have been introduced.The format for assessment or assurance is detailed in Annexure 17A.“Assessment” refers to a third-party review undertaken as per Industry Standards Forum (ISF) standards, developed in consultation with SEBI.
The requirement for assessment or assurance of BRSR Core will be phased in based on market capitalization:
| Financial Year | Applicability |
|---|---|
| 2023 – 24 | Top 150 listed entities |
| 2024 – 25 | Top 250 listed entities |
| 2025 – 26 | Top 500 listed entities |
| 2026 – 27 | Top 1000 listed entities |
Appointment of Assessment or Assurance Provider
The Board of the listed entity must ensure the assessment or assurance provider has the necessary expertise.
Conflict of Interest Restrictions:
The provider must not sell products or provide non-audit/non-assessment/non-assurance services, including consulting, to the listed entity or its group companies
Amendments to Reporting Formats
Annexure 16 (Disclosure Requirements):
Point 14: Name of assessment or assurance provider.
Point 15: Type of assessment or assurance obtained.
Annexure 17A (Format of BRSR Core):
Column “Data & Assurance Approach” revised to “Data & Assessment or Assurance Approach”.
Sr. No. 4 – Waste Recovery Parameter:
Disclosures must specify if vendor certificates were relied upon for assessment or assurance of waste management KPIs.
ESG Disclosures for Value Chain
n order to facilitate ease of doing business, provide additional time to listed entities and their value chain partners for setting up measurement and reporting systems and avoid unintended impact on small businesses in terms of cost and compliance requirements, it has been decided to defer the disclosure and assessment or assurance with respect to value chain by one year and to revise the threshold for values chain partners.
Disclosures for value chain shall be made by the listed company as per BRSR Core, as part of its Annual Report. For this purpose, value chain shall encompass the top upstream and downstream partners of a listed entity, individually comprising 2% or more of the listed entity’s purchases and sales (by value) respectively. However, the listed entity may limit disclosure of value chain to cover 75% of its purchases and sales (by value) respectively.”
ESG disclosures for the value chain shall be applicable to the top 250 listed entities (by market capitalization), on a voluntary basis from FY 2025- 26
The assessment or assurance of the above shall be applicable on a voluntary basis from FY 2026-27.
For the first year of reporting ESG disclosures for value chain, reporting of previous year numbers shall be voluntary. To illustrate, for value chain disclosures of FY 2025-26, reporting of previous year data (i.e., data for FY 2024-25) shall be voluntary
If a listed entity provides ESG disclosures for value chain, then it shall disclose the percentage of total sales and purchases covered by the value chain partners, respectively, for which ESG disclosure are provided.
The provisions of circular shall be applicable from the date of issuance of this circular, except otherwise mentioned specifically.
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