Sebi relaxes on timeline for review of ESG rating on BRSR publication

To promote ease of doing business, markets regulator Sebi on Friday provided relaxation in the timeline for review of ESG rating following the publication of Business Responsibility and Sustainability Reporting (BRSR).

ESG Rating Providers (ERPs) will carry out a review of the ESG ratings upon the occurrence of or announcement/ news of such material developments immediately, but not later than 10 days of occurrence of the said event.

However, review of the ESG rating following the publication of BRSR by the rated entity will be carried out immediately, but not later than 45 days after the publication of the BRSR, Sebi said in its circular.

This came after ERPs made a representation to Sebi highlighting the operational challenges faced in undertaking review of ESG ratings for a large pool of listed companies following publication of BRSR by such companies, within the specified timeline of 10 days.

ERPs have made a representation to Sebi, highlighting the operational challenges faced in undertaking review of ESG ratings for a large pool of listed companies pursuant to publication of BRSR by such companies, within the specified timeline of 10 days.

The framework will be applicable with immediate effect.

Earlier in December, Sebi decided to defer the ESG disclosure deadline for value chain partners of listed companies by one year until FY26, giving more time to them to comply with the BRSR requirements.

Until then, environmental, social and governance (ESG) reporting will remain voluntary instead of the current "comply-and-explain" approach.