Only one-fifth of 586 companies published sustainability report: CRISIL
Posted By : Deepak Naik | Date : May 20 2022 9:35 AM
Sharing sector details, the report highlighted that none of the airline companies covered in the report disclosed their absolute percentage of sustainable aviation fuel (SAF) in overall fuel consumption.
CRISIL's Environmental, social, and governance (ESG) risk assessment of 586 Indian companies across 53 sectors revealed only one-fifth of the companies have published their sustainability report. Of the 53 sectors covered, service companies including IT, lending, and auto OEMs are the leaders in terms of ESG disclosures, whereas chemicals, mining, construction EPC, and transport infrastructure are not good with disclosures. CRISIL also found that compared to the last year's report, 12 companies published detailed sustainability reports for the first time. And of the companies that did earlier, nine are yet to publish for fiscal 2021.
Amish Mehta, Managing Director and CEO, CRISIL Ltd, "Leaders on ESG have demonstrated a clear commitment towards sustainability, and have consistently delivered superior performance. In contrast, those in the 'weak' and 'below-average' categories have poor disclosures and inadequate ESG risk-management practices. The uptake of sustainability in decision making is very piecemeal in India Inc because of a lack of stewardship, and fiduciary persuasion to improve the ESG quotient. For ESG to truly be embedded and practiced in spirit, all stakeholders have to work collaboratively and create a favourable environment for ESG in India. In addition to focussing in the near-term on targeted actions such as decarbonisation, a mindset shift is necessary to transform from merely complying to creating value and structurally mitigating risk."
A significant portion of the rising average temperature globally and global warming are a result of greenhouse gas (GHG) emissions, in India, only 1 in 5 companies reported their Scope1 and Scope 2 GHG emissions. The disclosure on Scope 3 emissions was even worse - only 63 out of 586 companies published this data.
Sharing sector details, the report highlighted that none of the airline companies covered in the report disclosed their absolute percentage of sustainable aviation fuel (SAF) in overall fuel consumption. None of the auto ancillary companies disclosed their number of product recalls, either voluntary or involuntary. In Logistics, none disclosed fuel consumption, or the number of EVs in their portfolio, or usage of eco-friendly packaging. However, on the bright side, 79 per cent of FMCG companies disclosed initiatives on packaging such as reduction in laminate based/paper packaging, elimination of single use plastic, and usage of recyclable packing material. In Hotels, 3 out of 4 companies have disclosed the percentage of their portfolio with green building certification, averaging 28.5%.
With India aiming to achieve net zero target by 2070, the findings of the reports only highlight the need of publishing sustainability reports.