Women form less than 25% of most Indian companies' board, says study

Around 90 per cent of Indian companies’ boards and executives are less than 25 per cent female. The findings are part of a study by Refinitiv that tries to gauge the level of transparency in public disclosure of environmental, social and governance (ESG) strategies, and performance data across 110 Indian companies vis-a-vis markets, such as South Africa, Brazil, China, and Hong Kong.

Only around 5 per cent of Indian companies have a policy on ESG-related executive compensation, which is much lower than the overall universe of the above-mentioned markets (23 per cent). Less than 20 per cent of Indian companies offer compensation improvement tools for executives, observed the study.

Forty-six per cent of Indian companies publish sustainability reports in accordance with the Global Reporting Initiative (GRI) standards, according to the study. GRI is an independent international organisation whose sustainability standards are globally accepted for ESG reporting. The average transparency rating for Indian companies is 34 per cent, higher than the average transparency rating of 25 per cent across the companies universe. Around 75 per cent of Indian companies publish BRR (Business Responsibility Reporting), either separately or by integrating it into their sustainability or annual reports. Around 82 per cent of Indian companies publish CSR/sustainability reports (as against only 50 per cent of companies in the overall universe), of which 46 per cent follow GRI guidelines.

The Securities and Exchange Board of India (SEBI) mandates that the largest 1,000 publicly listed firms report their ESG practices, as per BRR guidelines. Reviewing transparency of these companies’ ESG reporting, Sebi makes recommendations on additional metrics to be included, which will further enable companies to strengthen their processes and performance on themes, such as emissions and employee health and safety, to attract the growing number of sustainable investors globally.

“Sebi should mandate that companies seek external verification of disclosures made in their sustainability reports to increase trust and confidence in their relationships with various stakeholders. BRR requirements should be more comprehensive, covering a greater range of emissions, health and safety performance and waste generated during operations,” the study observed.