Disclosures must on gender diversity, cybersecurity
The Securities and Exchange Board of India (SEBI) on Monday issued a circular notifying new disclosure norms on sustainability related reporting for the top 1,000 listed companies by market cap by FY23.
Such a reporting will now be under a new business responsibility and sustainability report (BRSR) format. The decision was first made at SEBI’s board meeting on March 25.
“The BRSR is a notable departure from the existing business responsibility report and a significant step towards bringing sustainability reporting at par with financial reporting,” SEBI said in the circular.
Now, the companies will need to provide an overview of their material environmental, social, governance risks and opportunities and approach to mitigate or adapt to the risks along with financial implications.
Sustainability related goals and targets and performance and environment-related disclosures covering aspects such as resource usage (energy and water), air pollutant emissions, greenhouse emissions, transitioning to circular economy, waste generated and waste management practices and bio-diversity may have to be provided.
The social-related disclosures will cover the workforce, value chain, communities and consumers.
Companies will have to disclose the gender and social diversity of employees, including measures for differently-abled employees and workers, turnover rates, median wages, welfare benefits to permanent and contractual employees / workers, occupational health and safety and trainings. On the community front, companies need to make disclosures on social impact assessments (SIA), rehabilitation and resettlement and corporate social responsibility. For consumers, they have to make disclosures on product labelling, product recall and complaints in respect of data privacy and cybersecurity.
To give time to companies to adapt to the new requirements, the reporting of BRSR will be voluntary for FY22 and mandatory from FY23. However, companies are encouraged to be early adopters of the BRSR, thus being at the forefront of sustainability reporting, SEBI said.
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