To ensure better compliance with corporate governance norms, the Securities and Exchange Board of India (Sebi) has notified new rules making it mandatory for the top 500 listed companies to prepare annual business responsibility reports, covering their activities related to environment and stakeholder relationships.
Presently, the business responsibility reports (BRs) are mandatory for the top 100-listed entities based on market capitalisation at BSE and NSE. The decision by Sebi is part of larger efforts to improve corporate governance practices and more transparency in terms of reporting of various socially responsible activities carried out by the listed entities.
The move comes after Sebi’s board approved the decision last month. Sebi has now made it applicable for top 500 listed companies, based on their market capitalisation at the end of March every year, to submit business responsibility reports, it said in a notification. The new regulation — Sebi (Listing Obligations and Disclosure Requirements) — would come into force from April, 2016.
In August 2012, Sebi made business responsibility reporting compulsory for top 100 listed entities based on market capitalisation in their annual reports. The key areas required to be reported by the entities include environment, social, governance and stakeholder relationships.
