Gear up for 2023 Reporting Season – Guide to BRSR Reports
Business Responsibility and Sustainability Report (BRSR) is meant to serve as “a single comprehensive source of non-financial sustainability information relevant to all business stakeholders – investors, shareholders, regulators, and the public at large.”
In 2019, the Ministry of Corporate Affairs (MCA) formed a committee to align the preceding Business Responsibility Reporting (BRR) formats in line with the National Guidelines for Responsible Business Conduct (NGRBCs) and provide new formats.
Due to the changing expectations and external like government regulations, compliances, shifting consumer preferences, and investor pressure, BRR became irrelevant and was shown to lack in quality (of disclosures) by a 2018 NSE report. This eventually resulted in the creation of a more robust reporting framework – the BRSR – that was globally aligned with reporting standards. Therefore, in 2020, the MCA adopted the NGRBC which subsequently led to the replacement of BRR with BRSR. It is the first framework to truly address environmental, social, and governance issues in India.
The BRSR report is aimed at helping Indian companies address additional issues that are gaining global importance such as climate change, inclusive growth, diversification of the workforce, and a sustainable environment and society.
BRSR reporting has been mandatory for the top 1,000 listed companies in India FY 2022–23 onwards.
A good Business Responsibility and Sustainability Report should be comprehensive, transparent, and objective. It should include information on a company’s environmental, social, and governance (ESG) performance, as well as its strategies and goals for improving ESG performance in the future.
What BRSR Reporting aims to achieve
The Framework
The Committee proposed two formats for the BRSR reporting with separate guidance notes for each. They are known as the ‘BRSR Comprehensive’ which is aimed at the listed companies and has a much wider scope and ‘BRSR lite’ for the unlisted companies who wish to voluntarily adopt these standards
BRSR Comprehensive: Mandatory For Listed Companies
The framework of BRSR Comprehensive has been designed with reference to various existing globally recognized and locally relevant non-financial reporting frameworks.
BRSR Lite: For Unlisted Companies
The Comprehensive framework of BRSR reporting guidelines is highly extensive covering multiple areas of the business in detail. Unlisted companies and other MSME organizations with no prior experience in non-financial reporting are often not able to meet the reporting requirements of the comprehensive BRSR framework. The committee thus proposed a framework called BRSR Lite, which has a different category of essential and leadership reporting. It has fewer elements than the comprehensive version and seeks information that these companies will be able to provide. This framework enables unlisted and MSME organizations to come within the ambit of those companies that carry out sustainability reporting and exemplify the impact they are making.
How can Snowkap help you create impactful BRSR Reports?
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SNOW IQ
Snowkap’s proprietary tool, sustainability reporting software, SNOW IQ, eases the extensive process of BRSR data collection by making it completely digital, and you have access to your company’s comprehensive data on easy-to-navigate dashboards.
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Centralised and Easy Data Collection
BRSR Reporting is a very resource-intensive operation. Snowkap saves your organization’s time and effort by centralizing the ESG data collection process into one platform via ESG tools.
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Gap Analysis and Improvement
We help identify and analyze gaps in the assessment and work with you to make improvements for the next FY.
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Impactful Presentation Made Easy
How you present your data is crucial, we aim to make your BRSR reporting impactful for all your stakeholders. You will be able to show your company’s ESG scores and attract investors while effectively communicating your sustainability effort to your consumers as well. You will be able to download the disclosure-ready report.
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Recurring
Once you’re part of the Snowkap platform, data collection will become a digital process, making data collection easy for the next FY disclosures.
Conclusion
While BRSR is mandatory for the top 1000 listed companies starting FY 23, the framework is a critical tool for all companies. Companies using the BRSR framework will begin to increase the amount of data collected, enhance data quality, and produce more transparent reports.
With the BRSR implementation, businesses in India are expected to reach higher disclosure levels in their quest to be socially, environmentally, and ethically responsible.
FAQs
What is BRSR guidelines?
The Business Responsibility and Sustainability Report (BRSR) is a framework designed by the Securities and Exchange Board of India (SEBI) to encourage companies to integrate sustainable and responsible business practices into their
operations.
What are the 9 principles of BRSR?
- Businesses should conduct and govern themselves with ethics, transparency, and accountability.
- Businesses should provide goods and services that are safe and contribute to sustainability throughout their life cycle.
- Businesses should promote the well-being of all employees, including those in their value chains.
- Businesses should respect the interests of, and be responsive towards all stakeholders, especially those who are disadvantaged, vulnerable, and marginalized.
- Businesses should respect and promote human rights.
- Businesses should respect, protect, and make efforts to restore the environment.
- Businesses when engaged in influencing public and regulatory policy, should do so in a responsible manner.
- Businesses should support inclusive growth and equitable development.
- Businesses should engage with and provide value to their customers and consumers in a responsible manner.
What is the principle 5 of BRSR?
Principle 5 of the BRSR framework states that businesses should respect and promote human rights. Companies should respect and promote human rights, including the rights to freedom of expression, association, and privacy. They should also prevent and address human rights violations in their operations and value chains.
Why is it called carbon neutral?
The term “carbon neutral” is used because it refers to balancing out the release of carbon dioxide into the atmosphere with an equivalent amount of removal. Carbon dioxide is one of the main greenhouse gases responsible for climate change and makes up roughly two-thirds of all greenhouse gas emissions.
Is BRSR report mandatory?
The BRSR reporting requirement is mandatory for the top 1000 listed companies in India by market capitalization from FY 2022-23 onwards. Listed companies other than the top 1000 may voluntarily submit a BRSR report FY2022 onwards.
What is the principle 3 of BRSR?
Principle 3 of the BRSR framework states that businesses should respect and promote the well-being of all employees, including those in their value chains. Companies should provide a safe and healthy working environment, fair wages, and benefits, and opportunities for personal and professional development. They should also respect the rights of employees to form and join trade unions, engage in collective bargaining, and participate in decision-making processes that affect their working conditions.
Why is BRSR reporting important?
BRSR reporting is important because it helps businesses communicate their sustainability performance, challenges, and opportunities to their stakeholders transparently. BRSR involves reporting on various ESG parameters, such as
environmental impact, social and community development, governance practices, and economic performance. This information can help investors, customers, employees, and other stakeholders make informed decisions about their engagement with the company. Additionally, BRSR reporting can help companies identify areas for improvement and track their progress towards sustainability goals.
What is the difference between GRI and BRSR?
The Global Reporting Initiative (GRI) is an international independent standards organization that helps businesses understand and communicate their impact on critical sustainability issues such as climate change, human rights, governance, social well-being. The GRI Standards are considered to be the first and most widely accepted standard for sustainability reporting internationally. The BRSR framework is benchmarked to global frameworks such as GRI.
In summary, while GRI is an international standard for sustainability reporting, BRSR is a reporting format introduced by SEBI specifically for listed companies in India.