Putting Planet First

WHILE INDUSTRIALISATION HAS BROUGHT NEWER OPPORTUNITIES, THERE IS NO DENYING THE FACT THAT IT ALSO LED TO CHALLENGES LIKE FAST INCREASING GLOBAL TEMPERATURES, NATURAL CALAMITIES, EXTREME WEATHER, LOSS OF BIODIVERSITY, DISEASE TRANSMISSION AND WIDENING INEQUALITY. A SECTOR-WISE DATA SHOWS THAT A WHOPPING 56% OF THE EMISSIONS IS ACCOUNTED FOR BY ENERGY INDUSTRIES, FOLLOWED BY MANUFACTURING AND CONSTRUCTION. THE TRANSPORT ACCOUNTS FOR 13% SHARE IN IT. ACCORDING TO S&P GLOBAL, INDIA IS LIKELY TO HAVE OVER 52% OF ITS GROSS DOMESTIC PRODUCT {GDP) EXPOSED TO PHYSICAL RISKS LIKE WILDFIRE, FLOOD, SEA LEVEL RISE, OR STORMS BY 2050. CLEARLY, EMBRACING SUSTAINABILITY HAS BECOME AN IMPERATIVE FOR BUSINESSES NOWADAYS.

- PRIYA KAPOOR 

The good news is that the awareness of ESG issues and targeting goals beyond maximising profits and minimising risks is now a growing trend among the corporates around the world. And this trend is now reflected among Indian companies too. Much like their global counterparts, they are also paying attention to the ESG framework. The latter, an acronym for Environment, Social and Governance, is a concept that makes the business measurable and quantifiable through a set of standardised criteria, unlike much discussed CSR, which is just about making a business responsible and accountable for its activities. So how are Indian companies faring on the sustainability front? While in the last one year companies have improved on their ESG scores, they are low on disclosures, according to the recent Sustainability Yearbook 2022 released by Crisil. Of the 586 companies covered, only one-fifth published a detailed sustainability report in fiscal 2021. While FMCG and Hotel industries were high on disclosures, companies that showed some glimmer of hope included auto OEMs, lending and cement sectors. In the cement industry, almost half of the companies analysed disclosed the clinker ratio, while two-thirds of the companies analysed in the auto space had EVs in their portfolio.

As many as 3 companies out of 5 in the textile sector disclosed the usage of recycled or sustainable source material. But only one adopted the Sustainable Apparel Coalition (SAC) HIGG Index, an industry standard to measure sustainability. The REITs put up a good show with 100% of them making quantitative disclosures on green building certifications in their portfolio.