ESG Glossary
A reference for key terms used in ESG reporting, regulation, and sustainable finance — with particular relevance to India's regulatory landscape.
BRSR — Business Responsibility and Sustainability Report
India's mandatory sustainability disclosure framework, introduced by SEBI in 2021. Required for the top 1,000 listed companies by market capitalisation. BRSR Core (2023) introduced assurance requirements for a subset of Key Performance Indicators (KPIs).
SEBI — Securities and Exchange Board of India
India's capital markets regulator. SEBI governs ESG disclosures for listed companies, including BRSR, ESG rating providers, and ESG-labelled mutual fund schemes.
MCA — Ministry of Corporate Affairs
India's corporate affairs ministry, responsible for company law (Companies Act 2013) and the National Guidelines on Responsible Business Conduct (NGRBC) — the framework underlying BRSR.
LODR — Listing Obligations and Disclosure Requirements
SEBI's regulations governing listed companies' ongoing disclosure obligations. BRSR is mandated under LODR Regulations.
GRI — Global Reporting Initiative
The most widely used international sustainability reporting standard. GRI Standards cover economic, environmental, and social topics. Many Indian companies use GRI as a complement or alternative to BRSR.
ISSB / IFRS S1 & S2
The International Sustainability Standards Board (ISSB), established by the IFRS Foundation in 2021, issued IFRS S1 (general sustainability disclosures) and IFRS S2 (climate-related disclosures) in 2023. India is expected to converge with ISSB standards over time.
TCFD — Task Force on Climate-related Financial Disclosures
A framework developed by the Financial Stability Board for disclosing climate-related risks and opportunities across four pillars: governance, strategy, risk management, and metrics & targets. TCFD informed both IFRS S2 and the BRSR climate KPIs.
CSRD — Corporate Sustainability Reporting Directive
The European Union's mandatory sustainability reporting directive, effective from 2024 for large EU companies and certain non-EU companies with EU operations. Relevant for Indian multinationals with EU exposure.
SBTi — Science Based Targets initiative
A global body that certifies corporate emissions reduction targets aligned with the Paris Agreement. Net zero targets verified by SBTi are considered best practice for corporate climate commitments.
Scope 1, 2 & 3 Emissions
A GHG Protocol framework for categorising greenhouse gas emissions:
- Scope 1 — Direct emissions from owned or controlled sources.
- Scope 2 — Indirect emissions from purchased electricity, heat, or steam.
- Scope 3 — All other indirect emissions in the value chain (upstream and downstream). The most complex and often largest category.
Net Zero
A state where greenhouse gas emissions produced are balanced by emissions removed from the atmosphere. Corporate net zero targets typically target 2050, with interim milestones. Distinct from "carbon neutral," which may rely more heavily on offsets.
Carbon Credits / Carbon Offsets
Tradable certificates representing one tonne of CO₂ equivalent reduced or removed from the atmosphere. Used to compensate for residual emissions that cannot yet be eliminated. Quality varies significantly; credibility depends on additionality, permanence, and third-party verification.
Article 6 — Paris Agreement
The article governing international carbon markets under the Paris Agreement. Article 6.2 allows bilateral trading of emissions reductions between countries; Article 6.4 establishes a UN-supervised global carbon market. Critical to India's carbon market development under the Carbon Credit Trading Scheme (CCTS).
CCTS — Carbon Credit Trading Scheme
India's domestic carbon market framework, established under the Energy Conservation (Amendment) Act 2022. Administered by BEE (Bureau of Energy Efficiency) and SEBI (for trading). Currently in development; initial sectors include aluminium, cement, and iron & steel.
REDD+
Reducing Emissions from Deforestation and Forest Degradation. A UN Framework Convention on Climate Change (UNFCCC) mechanism that provides incentives for developing countries to protect forests as carbon sinks.
Green Bonds
Debt instruments whose proceeds are earmarked for eligible green projects (renewable energy, energy efficiency, clean transport, etc.). Governed in India by SEBI's Green Bond framework and internationally by the ICMA Green Bond Principles.
Blended Finance
The use of development finance (concessional loans, guarantees, equity) to mobilise private capital towards sustainable development goals. Common in climate-related infrastructure projects in emerging markets.
ESG Rating
An assessment of a company's performance on environmental, social, and governance factors. SEBI has regulated ESG Rating Providers (ERPs) in India since 2023, requiring registration and disclosure of methodology.
Just Transition
The principle that the shift to a low-carbon economy should be fair and inclusive — protecting workers and communities most affected by the move away from fossil fuels, while creating decent green jobs.
NGRBC — National Guidelines on Responsible Business Conduct
India's policy framework for responsible business conduct, issued by MCA in 2019. NGRBC's nine principles form the foundation of BRSR's reporting structure.