UNDERSTANDING THE ENVIRONMENTAL, SOCIAL AND GOVERNANCE REGULATORY FRAMEWORK IN INDIA

Abstract

Environmental, Social and Governance considerations have moved, within roughly a decade, from a voluntary corporate reporting practice to an increasingly codified regulatory expectation in India, driven by heightened global concern over climate change, growing institutional investor demand for sustainability-linked disclosure, and a judiciary willing to treat environmental harm as a matter of constitutional concern under Article 21. This paper examines the legal architecture underpinning ESG regulation in India, tracing its foundation in pre-existing environmental, labour and corporate law through to the specific ESG provisions embedded in the Companies Act, 2013, and the more recent, rapidly evolving regulatory framework the Securities and Exchange Board of India and the Reserve Bank of India have constructed around Business Responsibility and Sustainability Reporting, ESG Rating Provider registration, and climate-related financial risk disclosure. It evaluates the Companies Act's ESG-relevant provisions, including Sections 134, 135 and 166, against their practical enforceability, and analyses SEBI's phased BRSR Core assurance timeline and its recurring deferral of mandatory value chain disclosure, developments that continue through 2026. The paper argues that India's ESG framework, while doctrinally coherent in its individual components, remains fragmented across at least three regulators and lacks the unified enforcement architecture, standardised metrics and stakeholder representation necessary to convert disclosure into accountability, and it proposes consolidation, standardisation and phased enforcement reform capable of closing that gap without imposing disproportionate compliance burden on smaller enterprises.