India Inc’s ESG ratings improving steadily: CRISIL Report

The report found that the rise in performance was greatly witnessed across renewable energy use, gender diversity, and board independence

May 20, 2022

The report evaluated 586 companies across 53 industries

14 companies were mentioned in the 'leadership' category, 108 in the 'strong' category, and 73 in the 'below average' category

In terms of social aspects, public sector units (PSU) did better

In governance practices, private corporate lead the performance

India Inc’s environmental, social, and governance (ESG) ratings are steadily increasing, owing to improved performance in multiple categories, according to a report by CRISIL. The report, which used FY21’s data, found that the rise in performance was greatly witnessed across renewable energy use, gender diversity, and board independence.

The report evaluated 586 companies across 53 industries and has found 14 companies in the ‘leadership’ category, 108 in the ‘strong’ category, and 73 in the ‘below average’ category. It noted that when the same set of firms was compared to their FY20 analysis, 14 of them exhibited a significant positive deviation at a greater than 5-point gain in the score, and three showed a negative deviation of more than a 5-point fall in score.

In terms of social aspects, public sector organizations did better, with an average score of 55 compared to 49 for private businesses, as per the report. They performed better on important metrics such as gender diversity (15.3%, compared to 12.7% for private firms), attrition (2% compared to 22%), and difference in pay (2% for PSUs versus 22% for private companies). The CEO-to-median employee pay ratio is 4.8 times for PSUs, and 137 times for private corporations.

In governance practices, PSUs underperformed compared to private companies, largely in board composition and functioning, it added.

As an overall result for the companies, the rating for the environmental aspect was weaker than the social and governance.

Recent Articles

PLI-linked Capex to reach INR 1 trn by FY24

November 24, 2022

India’s PLI schemes are expected to make various industries increase …

Read More

Govt. to assist selected telecom companies under PLI scheme

November 24, 2022

To increase local manufacturing, the Indian government aims to provide …

Read More

India ranked 8th in Climate Change Performance Index

November 23, 2022

India rose to the eighth rank on the Climate Change …

Read More