Decoding BRSR Core: How Technology Empowers Enhanced ESG Reporting in India

By Shailesh Tyagi and Madhu Sudan Kankani

Globally, ESG regulations have rapidly evolved since the 1990s, indicating an increasing need for action to combat climate change. In response to this urgent requirement, countries have begun to introduce their own climate-related disclosures. In 2021, the Securities and Exchange Board of India (SEBI) mandated the Business Responsibility and Sustainability Reporting (BRSR) framework for the top 1,000 listed companies in India. By aligning with global sustainability reporting frameworks such as the Global Reporting Initiative (GRI), the United Nations Sustainable Development Goals (UN SDGs), and the Sustainability Accounting Standards Board (SASB), BRSR aims to enhance transparency, comparability and promote responsible and sustainable business practices.

In July 2023, SEBI introduced additional ESG metrics for mandatory disclosure across nine ESG attributes within the BRSR Core, a subset of the BRSR. This inclusion aims to address specific KPIs relevant to the Indian economy, enhancing transparency and accountability among listed entities. From FY 2023-24 onwards, the top 150 listed entities in India by market capitalisation are required to adhere to these expanded disclosure requirements and obtain reasonable assurance in line with a predetermined glide path. Additionally, starting from FY 24-25, the top 250 listed companies will be mandated to disclose over 20 KPIs under the nine BRSR Core attributes for their value chain as well. From FY 25-26, these disclosures will require limited assurance, further emphasising the commitment to sustainable and responsible business practices throughout their operations and value chain.

Challenges in complying with BRSR Core

The challenges associated with BRSR Core reporting vary for individuals involved in gathering, analysing, and verifying data. For data collectors, the obstacles encompass collecting, verifying, and consolidating data from multiple sources within an organisation and value chain partners. This makes ensuring the accuracy and integrity of the data both crucial and challenging. Furthermore, a lack of awareness and expertise concerning BRSR, combined with the sensitivity required in handling data and engaging stakeholders, adds to the complexity. It may be noted that the rigour in reasonable assurance is similar to that required for audit of financial statements which has evolved over decades.

Similarly, from an assurance provider’s perspective, ensuring the integrity of BRSR Core reporting involves several challenges. Inconsistencies in data and calculations can impede the creation of a reliable audit trail. The complexity of the metrics requires assurance providers to have a thorough understanding of detailed sustainability standards. Integrating existing systems and financial data can lead to inaccuracies, underscoring the need for robust IT controls. The absence of standardised procedures and documentation thereof makes the verification process more complicated and challenging. Additionally, manual data collection is prone to errors, necessitating strict verification protocols like maker-checker process, etc.

For any of the reportable BRSR Core-based performance parameters, if its processes are found to be inappropriate, and fail to provide confidence to the assurance provider, an assurance provider could deny the issuance of a reasonable assurance opinion. This underscores the importance of rigorous processes and accurate reporting in meeting BRSR Core requirements.

Technology as an enabler for ESG data management and reporting

A 2022 ESG Global Study with 11,000 participants from 15 countries highlighted that 89% of business leaders believe that companies using technology for sustainability are more likely to succeed, 93% of these leaders acknowledge technology’s crucial role in enhancing corporate sustainability and 94% advocate the use of technology in ensuring data accuracy, automating data collection across sectors, planning, and revising sustainability targets based on performance, and automating report generation.[1]

Technology can empower companies to efficiently collect, analyse, and report scattered data towards their ESG requirements. Through Software-as-a-Service (SaaS) ESG solutions, businesses can seamlessly standardise, monitor, and report ESG data and generate sustainability reports aligned with BRSR and global regulatory frameworks, including the Global Reporting Initiative (GRI), Task Force on Climate-Related Financial Disclosures (TCFD), and Sustainability Accounting Standards Board (SASB).

ERP systems can streamline data collection and verification for embedding ESG into business operations and disclosing ESG data across the value chain, thus adding adequate and required internal controls to provide higher level of data integrity. Additionally, advanced digital ESG tools enable comprehensive carbon footprint calculations, value chain assessments, peer benchmarking, predictive analysis, comprehensive tracking, enhanced traceability, and robust audit trails, facilitating authentic and verifiable data. These tools allow for efficient data management and quick data retrieval for the decision-making process. For example, to add a travel and expense system that can provide carbon footprint data mapped to actual travel expenses claimed through the system.

The adoption of BRSR Core framework signals not only a critical step towards accountability and transparency in Indian businesses but also marks the beginning of a transformative era where innovation becomes the cornerstone of sustainable development. This paves the way for future businesses to adopt and enable climate disclosures more effectively.

[1] Study Report: No Planet B: How Can Businesses Technology Help Save the World? (oracle.com)


(The authors are Shailesh Tyagi, Partner, Climate Change & Sustainability Leader, Consulting, Deloitte South Asia and Madhu Sudan Kankani, Partner, Deloitte India, and the views expressed in this article are their own)