ESG Compliance for Indian SMEs

India is a land of growing opportunities. With a vast population and its growing needs, the country’s economy is expected to grow at an exponential rate in the future. The country has one of the highest rates of budding entrepreneurs and SMEs. However, with rising consumerism, there is an increasing threat of environmental abuse. As such, consumers are looking at transacting/ building relations with environmentally-inclined enterprises which is creating increasing pressure on these budding businesses which are as it is straddled with the hopes of making their business ideas a success.

Many countries like Canada have introduced the concept of assisted programs to help their SMEs in this regard. They have established Canada Economic Development (CED) for Quebec Regions for providing guidance, and expertise, and implementing solutions on the ground. The government will also help SMEs finance their green projects and help them transit to more sustainable business models. SMEs will in turn benefit from more business opportunities and meet their labor needs to ensure growth while contributing to their communities’ wellbeing.

SMEs have become an important pillar of our economy.  India is expected to achieve net zero emissions by 2070 and reduce Greenhouse Gas (GHG) by 2030. Therefore, it is important that Indian businesses form their business strategies around ESG standards set by the government. According to a recent survey, more than 90% of Indian SMEs in India are environmentally more responsible, when compared to their Asian counterparts. SEBI has also revised its guidelines to ensure India’s ESG compliance according to global standards. The stress has been more post-pandemic as the world views COVID-19 as an outcome of the climate change crisis and is emphasizing the implementation of ESG norms to prevent any future recurrence.

Also, read ESG Sustainability Reporting Metrics that Matter Most to Investors.