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The Business Responsibility and Sustainability (BRS) report, offers several benefits to organizations. Here are some key advantages:

1. Enhanced reputation: Publishing a BRS report demonstrates a company’s commitment to ethical practices, sustainability, and social responsibility. It helps build trust and credibility among stakeholders, including customers, investors, employees, and the public, leading to an enhanced reputation.
2. Stakeholder engagement: The BRS report provides a platform for transparent communication and engagement with stakeholders. It allows organizations to share their sustainability initiatives, environmental impacts, social contributions, and future goals, fostering meaningful relationships with stakeholders and encouraging their active involvement.
3. Competitive advantage: A well-structured and comprehensive BRS report can set an organization apart from its competitors. It showcases the company’s sustainability performance, innovation, and forward-thinking approach, positioning it as a leader in the market and attracting customers and investors who prioritize ethical and sustainable practices.
4. Risk management: The BRS report helps identify and manage potential risks associated with environmental, social, and governance (ESG) factors. By assessing and disclosing these risks, organizations can take proactive measures to mitigate them, minimizing potential legal, reputational, or operational issues.
5. Cost savings and efficiency: Focusing on sustainability often leads to cost savings and increased operational efficiency. Through the BRS report, companies can highlight their efforts in reducing waste, improving energy efficiency, optimizing supply chains, and adopting sustainable practices, resulting in reduced resource consumption and associated costs.
6. Regulatory compliance: Many countries have regulations and reporting requirements related to corporate sustainability and social responsibility. Creating a BRS report helps organizations comply with these regulations and stay updated on evolving standards, ensuring they operate within legal boundaries.
7. Investor attraction and access to capital: Investors are increasingly considering ESG factors when making investment decisions. A comprehensive BRS report showcases a company’s sustainable practices and long-term viability, making it more attractive to socially responsible investors. It can also open doors to sustainable investment funds and capital providers that prioritize organizations with strong ESG performance.
8. Employee engagement and retention: The BRS report serves as a tool to engage employees and align them with the organization’s sustainability goals. It highlights the company’s commitment to ethical and responsible practices, fostering a sense of pride and purpose among employees. This, in turn, can lead to improved employee satisfaction, retention, and productivity.
9. Innovation and future-proofing: Emphasizing sustainability in the BRS report encourages organizations to seek innovative solutions and technologies that reduce environmental impact and improve social outcomes. It drives organizations to adapt to changing market trends, customer demands, and regulatory requirements, ensuring long-term viability and resilience.
10. Positive societal impact: Ultimately, the BRS report contributes to positive societal impact by promoting sustainable practices, responsible business conduct, and engagement with local communities. It enables organizations to address social and environmental challenges, aligning business objectives with broader sustainable development goals.

Overall, the BRS report offers numerous benefits, ranging from improved reputation and stakeholder engagement to risk management, cost savings, and access to capital. It helps organizations become more sustainable, resilient, and successful in the long run

Applicability

In India BRS report is required to be published by top 1000 listed entities based on market capitalization.

Further recently SEBI at its board meeting dt: March 30, 2023 approved Balanced Framework for ESG Disclosures, Ratings and Investing.

The SEBI Board approved the regulatory framework for ESG (Environmental, Social and Governance) Disclosures, Ratings and Investing and amendments to SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and SEBI (Mutual Funds) Regulations, 1996 to facilitate a balanced approach to ESG.

The key decisions taken by the Board in this regard, are given below:

1.1 On ESG Disclosures

II. In order to facilitate the credibility of ESG Ratings, ERPs shall offer a separate category of ESG Rating called as ‘Core ESG Rating’, which will be based on the assured parameters under BRSR Core.

Recent issues at annual general meeting on sustainability

It’s worth noting that in recent years, there has been an increasing focus on sustainability issues in AGMs and corporate meetings in general. Many companies are recognizing the importance of addressing environmental, social, and governance (ESG) issues and integrating sustainability into their business strategies.

Recently stalled shareholders meeting of Shell in London. Reason for stalling the meeting was company is not clearly laying down it’s plans to become net zero emission company. Company is still dependent on fossil fuels for their business.

https://www.cnbc.com/2023/05/23/oil-giant-shell-braces-for-shareholder-revolt-over-climate-plans.html

Climate activists have been stalling annual general meetings of oil and gas giants primarily as they are the largest contributors to carbon emissions. Some of these instances can be accessed at below link: https://www.cnbc.com/2023/05/23/oil-giant-shell-braces-for-shareholder-revolt-over-climate-plans.html – Tear Gas taints Total Energies annual meeting. Company rejects climate activist resolution.

Also similar flak was faced by BP Ltd at their recent AGM in April 2023. https://qz.com/bp-general-meeting-interrupted-climate-protesters-1850381817

This highlights importance of reporting business sustainability and responsibility reporting. The sooner companies accepts this and starts reporting voluntarily about sustainability it would help them in attracting good amount of valuation.

Consequences of unsustainability or not adhering to sustainability compliances

Not adhering to sustainability aspects can have significant consequences for both the environment and society. Here are some potential consequences:

Environmental degradation: Ignoring sustainability practices can lead to environmental degradation and the depletion of natural resources. This can include deforestation, habitat destruction, pollution of air, water, and soil, loss of biodiversity, and climate change. These consequences can have far-reaching impacts on ecosystems, wildlife, and the overall health of the planet.

Climate change: Failing to address sustainability can exacerbate climate change, which has severe consequences such as rising global temperatures, extreme weather events (hurricanes, droughts, floods), sea-level rise, and disruption of ecosystems. These effects can lead to increased vulnerability, economic losses, and displacement of populations.

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Disclaimer: This article provides general information existing at the time of preparation and we take no responsibility to update it with the subsequent changes in the law. The article is intended as a news update and Affluence Advisory neither assumes nor accepts any responsibility for any loss arising to any person acting or refraining from acting as a result of any material contained in this article. It is recommended that professional advice be taken based on specific facts and circumstances. This article does not substitute the need to refer to the original pronouncement