In a major leap towards sustainable corporate governance, NSE Sustainability Ratings & Analytics Ltd, a wholly owned subsidiary of the National Stock Exchange of India (NSE), has launched its ESG (Environmental, Social, and Governance) ratings for listed companies. This landmark initiative is set to revolutionize how companies in India approach sustainability, transparency, and stakeholder accountability.
What Are ESG Ratings and Why Do They Matter?
ESG ratings are critical tools that evaluate a company’s environmental impact, social responsibility, and governance standards. They help investors, regulators, and the public assess how responsibly a company operates. As sustainable investing gains momentum globally, ESG ratings are becoming a decisive factor for ethical and long-term investment decisions.
SEBI Recognition: NSE Sustainability Becomes a Category I ESG Rating Provider
NSE Sustainability Ratings & Analytics Ltd received Category I registration from SEBI (Securities and Exchange Board of India) on August 13, 2024. This authorizes the firm to issue ESG ratings under SEBI’s regulatory framework, enhancing its credibility and legitimacy.
Transparent and Data-Driven ESG Rating Methodology
NSE Sustainability’s ESG ratings are based on a materiality-focused, data-driven methodology aligned with both Indian and global standards. Key features include:
- Sector-specific evaluation frameworks
- Integration of national/international ESG benchmarks
- Transparent disclosure-based assessments
- No size or industry bias
This approach ensures that ESG scores reflect actual sustainability performance rather than marketing claims or arbitrary factors.
Key Leaders Speak on the ESG Ratings Launch
Ashishkumar Chauhan, MD & CEO of NSE, emphasized:
“NSE Sustainability’s mission is to provide stakeholders with accurate, comprehensive, and unbiased evaluations of corporate sustainability practices.”
Aniruddha Chatterjee, CEO of NSE Indices, added:
“Our ESG ratings, data, and analytics will set a benchmark in advancing ESG practices across industries.”
Impact on India’s Corporate Ecosystem
The launch of NSE’s ESG ratings is expected to:
- Drive transparency and accountability among listed companies
- Encourage sustainable business practices
- Boost India’s global ESG credibility
- Attract ESG-focused institutional investors
- Align Indian corporates with UN SDGs and global sustainability goals
It also supports SEBI’s broader vision of making India a leader in sustainable finance and responsible corporate governance.
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