last month Samsung had churned its top management by replacing CEO for enhance competitiveness and promote future growth. At Consumer Electronics Show (CES) 2022, the new leadership team of Samsung has shared its future vision which will focus on range of sustainability initiatives. Company is fast moving towards making its operation sustainable which is evident by the fact that its memory chips has helped in reducing 700,000 tonnes of carbon emissions and has plans to use thirty times more recycled plastics in its future products.
Only a handful Indian corporations are among the 11,100 worldwide companies that report on ESG. The Task Force on Climate Financial Disclosure required firms to identify models and estimate risks when it came to climate risk declarations. According to some global energy groups’ assessments, we were still at 1.8 to 2.4 degrees Celsius, well above the 1.5-degree Celsius limit. By 2050, India may see 75 times more heat waves, with 21 major cities designated as “water scarce” and expected to run out of water by 2030, and 75 percent of Indian districts becoming hotspots.
Climate change poses a significant financial risk and has the potential to destabilise the global economy. Before making investment decisions, the investor community considers sustainability. ESG is increasingly being used as an investing criterion around the world, and it is becoming a popular investment option. Significant monies are flowing into green funds, which in turn are flowing downstream into green investment possibilities. Banking institutions, AIFs, mutual funds, brokerage firms, and advisors are now selling solutions that are fundamentally sustainable, as well as using ESG indicators in their due diligence.
India, like other countries, has taken steps to incorporate ESG practises into its legal system. SEBI introduced BRSR as the new reporting structure in 2021, along with changes to the listing laws. Top 1000 listed entities in terms of market capitalization are now required to provide an overview of the entity’s material ESG opportunities, risks, and financial implications, disclose gender ratio, conduct business with integrity and in an ethical manner, provide training and create awareness among employees and workers, conduct social impact assessments, promote human rights by providing welfare benefits, conduct impact assessments and human right reviews, and provide an overview of the entity’s material ESG opportunities, risks, and financial implications. The BRSR would push Indian enterprises to be more compliant and transparent in their reporting. The kind and scope of disclosures has widened as a result of ESG compliance.
Due to pollution violations, Volkswagen had to recall millions of cars and pay substantial fines as a result of a fault with an emission component in their vehicles, and Coca-Cola had to shut down its second largest bottling plant in India.
Several steps have been taken in New Zealand to reach net zero carbon emissions by 2050. The introduction of the Financial Sector Climate Related Disclosures and Other Matters Amendment Bill, which sought to amend the Financial Markets Conduct Act, the Financial Reporting Act, and the Public Auditor Act, requiring investors in the banking and finance sector with an investment over a certain amount to disclose consistent, comparable, reliable, and clear information about climate risks of entities in which they have an interest, was one such step. These restrictions are crucial because financial markets around the world could play a significant role in diverting investment away from enterprises that do not follow green practises.
For a long time, business reporting had been in practice in India. The MCA designed and established the Corporate Voluntary Guidelines in 2009, and the MCA’s National Voluntary Guidelines on Social, Environmental, and Economical Responsibilities of Business in 2011, before introducing in 2019, the National Guidelines on Responsible Business Conduct.
India is on its way to accomplishing a lofty goal. 150 GW of renewable energy had been installed, and the government had increased its objective for 2030 from 450 GW to 500 GW while focusing on energy efficiency and biofuels. However, there are problems that must be addressed in order to scale up further, including the non-fulfilment of renewable energy contracts, transmission, evacuation, and land acquisition issues, the financial health of DISCOMs, and inherent delays.
The Paris Agreement, which was signed six years ago, raised the subject of how a 1.5 degree Celsius increase in global temperature could have catastrophic consequences for the planet. Climate change and global warming will have a significant influence on India, as seen by untimely floods, increasing cyclones, rains, greater heat waves, and rising sea levels, among other things. Climate change repercussions are expected to be irreversible, according to scientists. India had promised to increasing its installed renewable energy capacity to 500 GW in order to meet 50% of its energy needs with non-fossil fuels and reduce carbon emissions. Although the government is taking steps, coordinated actions at all levels are essential to reduce carbon emissions. Indian Enterprises have to come forward for building a green economy which is connected and sustainable.
Bureau Galactik Views