Success with disclosure: IIM-Ahmedabad Associate Professor Anish Sugathan

Corporate disclosure is the substrate on which markets function. Investors price risk, lenders set terms, consumers choose between brands, and regulators monitor systemic exposure. The case for mandatory sustainability disclosure is the same case made for audited financial statements a century ago: when the information available to decision-makers is comparable, verifiable and material, capital and trust flow to the firms that earn them; when it is not, both are misallocated.

When Sebi made the Business Responsibility and Sustainability Report (BRSR) mandatory in FY2022–23 for the country’s top 1,000 listed firms, the wager was precisely that. A standardised, comparable, quantitative sustainability disclosure would do for non-financial information what financial reporting has long done for capital allocation.

Three full reporting cycles later, more than 3,400 BRSR filings sit on the public record. At the Centre for Sustainability and Corporate Governance Research (CSCG) at IIM-Ahmedabad, we have consolidated those filings into a unified panel. Two things stand out—one that is genuinely encouraging, one that is structurally stuck.  

THE ENCOURAGING PART

The base of the BRSR’s “implementation cascade” is at saturation. In FY25, 98% of listed filers report sustainability policies covering all nine National Guidelines for Responsible Business Conduct (NGRBC) principles. Board-level approval of those policies stands at 95%; translation into operating procedures at 97%. Coverage of NGRBC Principle 1 (Ethics, Transparency and Accountability) is at literally 100%. The first three years of mandatory BRSR have unambiguously normalised sustainability governance at the apex of corporate India.

Sectorally, the leaders are where one would expect them: Renewable Energy and Alternative Resources (85%), Transportation (81%), and Technology & Communications (81%) sit at the top of the maturity table. Resource Transformation (the manufacturing megabucket of 668 firms) and Infrastructure cluster around 81%, indicating a solid middle-of-the-road performance for India’s industrial spine.  

STRUCTURALLY STUCK

The same cascade reveals the gap. Value-chain extension, whether the sustainability policies reach upstream and downstream partners, sits at 77%. Independent external assessment of these policies sits at 31.7%. And across all sectors, NGRBC Principle 7 (Public Policy Advocacy) is the universally weakest one, in every single Sustainability Accounting Standards Board (SASB) industry.

The sectoral laggards are Healthcare (75%), Financials (74%), and Extractives & Minerals Processing (73%)—industries that, for very different reasons, may struggle to align a generic 1,400-item disclosure form with the reality of how in practice they create, mitigate or distribute material risk.  

RATIONALISATION SCOPE

The encouraging numbers and the stuck numbers, read together, point to a constructive rationalisation agenda. One that industry has been articulating for two years and that the data now supports.

First, demote the saturated questions. Of 53 cascade and standalone-policy indicators we examined, 24 are saturated at Yes-rates above 95% in FY25. Asking the same 24 questions every year, per principle, of every filer, generates essentially no new information.

The framework can move these to a one-time declaration with mandatory re-confirmation only on material change.

Second, consolidate the nine “external assessment” cells into a single audited assurance statement. The current form asks each filer, separately for each NGRBC principle, whether their policy implementation has been independently assessed—and the answers cluster within a five-percentage-point band, because firms either commission assurance or they don’t.

Third, build sector-proportionate materiality into Principle 6. P6 (Environment) alone is 224 of the taxonomy’s 1,406 reportable items—16% of the entire form, applied uniformly to a bank, a software firm and a steel maker. The result is N/A-stuffing in low-impact sectors and missed risk in high-impact ones.

What this list deliberately omits is also worth saying out loud. The 31% verification frontier is not where rationalisation should bite. Three years of static numbers say the market will not move that on its own; the BRSR Core assurance glide-path leading to top 1,000 coverage by FY27, is the only lever that does. India is on course to become the first major jurisdiction to mandate independent verification of sustainability KPIs at this scale; that destination should stay.

The point of this exercise is not lighter compliance for its own sake. It is to make sure the information BRSR generates is sharp enough to actually inform the choices that determine where India’s capital, customers and reputational capital flow.  

Views are personal