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ESG Now a Compliance Priority: India & EU Lead Charge
30 May
Summary
- Emerging EU carbon tax and India's CCTS make ESG a compliance necessity.
- Companies with poor carbon data risk losing global competitiveness.
- 72% of Indian firms are in early carbon readiness stages.
Environmental, social, and governance (ESG) reporting is rapidly evolving from a voluntary exercise into a critical compliance and business imperative, influenced by new regulatory frameworks. The European Union's Carbon Border Adjustment Mechanism (CBAM) and India's evolving Carbon Credit Trading Scheme (CCTS) are at the forefront of this shift.
Experts caution that businesses without credible carbon data and traceable reporting mechanisms could face substantial compliance risks and a diminished competitive edge globally. This is particularly concerning as a recent analysis indicates that 72% of Indian companies remain in the nascent stages of carbon readiness, despite mounting climate regulations.
Prioritizing carbon measurement, multi-framework reporting, and supply chain transparency is essential over the next two to three years. Early adopters in sustainability are poised to gain preferential access to green finance and a sustainable competitive advantage in export markets. Businesses must align their operations with both domestic and international climate regulations and sustainability disclosure standards.
