Only half of India’s listed companies are committed to net carbon emissions: WTW

• Most companies are wary of climate-related disclosures and are bogged down by high assessment costs, lack of regulatory mandate, etc.
  
• From SEBI mandate, top 1,000 listed companies must report their sustainability performance from FY23.
  
• However, their state of preparedness in terms of disclosures is varied, the report says.

Only half of India’s listed companies have made commitments on carbon emissions, while the other half are unsure, says a study by WTWa global consulting, brokerage and solutions company.

Among those who have made carbon emissions commitments, even fewer companies – 43% – are aiming to achieve net zero carbon emissions by 2032. This is despite 73% of companies overseeing board-level climate control or CEO risk.

Indian market regulator Securities and Exchange Board from India (SEBI) has mandated the top 1,000 publicly traded companies to report their sustainability performance from FY23. “With the top 1,000 listed companies in India required to undertake climate reporting based on recommendations from the Business Responsibility and Sustainability Report (BRSR), the state of preparedness has varied,” the report said.

Most companies face barriers related to climate-related disclosures for several reasons: high assessment costs, lack of regulatory mandate, insufficient data and standardized statistics, and lack of internal capabilities.

“We expect increased attention and attention from a wider range of stakeholders to climate-related disclosure and risk management in India. This is a specialist position, so it is understandable that most companies do not have in-house capacity. Businesses need to work with experts to bridge the gap with relevant data, analytics and insights to support climate change management Vivek Nathead of India, WTW.

Companies had doubts about frameworks

The report goes on to say that 79% of companies are unsure about which climate disclosure framework to adopt, despite having processes in place to identify, assess and manage climate-related risks.

Of the companies that have selected disclosure frameworks, most companies plan to use the CDP framework. CDP framework is a voluntary reporting framework that companies use to disclose environmental information to their stakeholders.

While 53% of companies surveyed are actively engaged in internal discussions to disclose under the Task Force on Climate Related Financial Disclosures (TCFD), 47% of companies are unaware of TCFD.

TCFD is a globally accepted action and reporting framework for climate change, endorsed by the SEBI and in India.

“While the current impetus for climate-related disclosures is a regulatory requirement or investor and consumer expectations, it is critical for companies in India to integrate climate risk mitigation and by extension environmental, social and governance (ESG) actions into their roadmap for climate transition. ‘ added Nathan.

ALSO SEE:
‘One-trick’ ponies – US, Indian and Chinese markets rally behind one story, investors should be cautious, experts say

The World Bank revises India’s GDP growth forecast upwards to 6.9% for FY23