Charting the Way Forward on ESG Assurance in India

1. Context

The credibility of sustainability disclosures is central to their relevance in investment decision-making. Without credible assurance, sustainability data risks becoming a collection of self-reported claims, vulnerable to greenwashing and material misstatement, with limited utility for investors and other stakeholders.1 Independent third-party assurance – whereby an external auditor validates the accuracy, completeness, and reliability of reported information – is hence critical for disclosure integrity.2

India's Business Responsibility and Sustainability Reporting (BRSR) framework, mandated for the top 1,000 listed entities by market capitalisation from FY 2022–23,3 was strengthened when the Securities and Exchange Board of India (SEBI) mandated third-party assurance for a focused set of key performance indicators (KPIs) – the BRSR Core – under a phased glide path.4 Initially, the top 150 entities were required to obtain reasonable assurance from FY 2023–24, scaling to the top 1,000 by FY 2026–27.

Reasonable assurance demands rigorous verification against established standards, in comparison to other modes of verification, such as limited assurance and assessment. The latter two are comparatively , offering lower evidentiary standards and greater interpretive flexibility for both companies and their verifiers.5 In December 2024, SEBI diluted third-party assurance requirements for BRSR, replacing mandatory reasonable assurance with the option of obtaining either third-party assurance or assessment. It also reset the glide path to cover the top 250 entities from FY 202425 and the top 1,000 by FY 2026-27.6 The rollback of reasonable assurance requirements by SEBI mirrors other regulators globally – for example, the European Union (EU) also similarly watered down its assurance requirements amid concerns over compliance complexity and costs.7

To better inform the direction of regulation, we assess how Indian companies are performing on assurance adoption. We assess adoption rates among 9958 companies (of the top 1000) who filed their BRSR reports in FY 2024-25.9 Further, we assess the type of assurance obtained by these companies (reasonable or limited), as well as the type of firms employed to provide assurance services.

2. Assessing assurance adoption by the top 1,000 companies in India

2.1 What proportion of companies filing BRSR reports are obtaining assurance?

One-third (333) of the top 1,000 companies (333) assured BRSR Core indicators in FY 2024-25. However, of these 333 companies, 235 companies were in the top 250 – for whom obtaining assurances was mandatory as per SEBI regulations. Among the mandated cohort of top 250 companies, assurance was nearly universal, at 94 per cent (Figure 1).

Figure 1. There has been nearly full compliance with assurance requirements amongst those mandated, with significant uptake among others on a voluntary basis

Source: CEEW-GFC analysis of BRSR reports of 995 filing companies (of the top 1000 listed companies) (FY 2024-25)

Beyond obtaining assurance for BRSR Core indicators as mandated, one in every three companies within the top 250 who obtained assurances (83 out of 235 companies), went over and beyond their regulatory mandate by assuring non-BRSR Core indicators as well (Figure 2). Among the top 251-500 and the top 501-1,000, 22 per cent and 9 per cent companies, respectively, obtained assurances voluntarily despite no regulatory requirements to do so. Overall, 13 per cent of the non-mandated companies (top 251-1,000) obtained assurance for BRSR Core indicators voluntarily.

Figure 2. A third of the top 250 companies not only obtained assurances, but went beyond the mandate and obtained assurances for non-BRSR Core indicators as well

Source: CEEW-GFC analysis of BRSR reports of 995 filing companies (of the top 1000 listed companies) (FY 2024-25)

2.2 What is the dominant nature of assurance obtained (limited or reasonable)?

For FY 2024-25, the top 250 companies had the option of undertaking either assurance or assessment of BRSR Core indicators, as indicated by SEBI in December 2024.10 Despite this relaxation, all companies across the top 250 (those mandated) or the top 251-1,000 (those voluntarily undertaking) who got their reports reviewed by third-party verifiers, opted for assurance (reasonable or limited).

In the mandated cohort (the top 250), reasonable assurance was almost unanimously preferred (98 per cent). Among the top 251-500, the split between reasonable and limited assurance was nearly even, whereas among the top 501-1,000, limited assurance was more common (70 per cent) (Figure 3). This could indicate that larger companies sought to demonstrate enhanced integrity and credibility through their disclosures, while smaller ones tended to adhere to minimum requirements.

Figure 3. Favoured assurance type tilts from reasonable to limited in lower market cap categories

Source: CEEW-GFC analysis of BRSR reports of 995 filing companies (of the top 1000 listed companies) (FY 2024-25)

2.3 What kinds of firms are providing assurance for BRSR reports?

Three types of assurance providers seem to be preferred by the assessed companies: (a) testing, inspection, and certification (TIC) firms that specialise in ensuring quality and performance standards for products, services, or systems;11 (b) consulting firms, including both advisories and sustainability consulting firms; and (c) chartered accountants (CAs) or statutory auditors, who are predominantly employed by firms for auditing financial reports.

Around half of the 333 assured reports among the top 1,000, TIC firms have provided assurance (Figure 4). This pattern holds across all three sub-categories of top 250, top 251-500 and top 501-1,000, highlighting the preference of the top 1,000 for TIC firms as assurance providers.

Figure 4. Testing, inspection, and certification (TIC) firms were the predominant assurance providers across all categories

Source: CEEW-GFC analysis of BRSR reports of 995 filing companies (of the top 1000 listed companies) (FY 2024-25)

Table 1. Data snapshot

Source: CEEW-GFC analysis of BRSR reports of 995 filing companies (of the top 1000 listed companies) (FY 2024-25)

3. The way forward

1. Reinstate the reasonable assurance mandate through a glide path: Given the greater reliability of reasonable assurance over limited assurance and assessment,12 the long-term focus should be to require that companies obtain reasonable assurance for their BRSR Core indicators, at a minimum. As the data shows, obtaining reasonable assurance is already the overwhelming choice of the top 250 firms (the mandatory cohort). SEBI could therefore consider reinstating the reasonable assurance mandate through a gradual glide path: mandate it for the top 250 and institute ‘at least limited’ assurance as a requirement for the rest from the outset, then upgrade to mandatory reasonable assurance requirements for the companies ranked 251-500, and finally extend this to those ranked 501-1,000 (in three phases).
2. Empanel credible TIC firms as assurance providers: SEBI regulations governing BRSR assurance explicitly outline conflict-of-interest restrictions, stating that firms providing consulting, actuarial, or accounting services (such as risk management, investment advisory, or bookkeeping services) to a company cannot simultaneously provide assurance on that company’s sustainability disclosures under BRSR.13 While assurance of financial disclosures is largely provided by CAs and statutory auditors, the SEBI regulation on conflict of interest opens the door to other categories of assurance providers for the BRSR Core. As the data shows, TIC firms are the most preferred option as assurance providers. These firms offer greater expertise in measurement and inspection of quantitative KPIs (such as environmental metrics), site inspection, understanding of sector-specific processes, and value-chain assessment Keeping in mind their popularity as assurance providers, SEBI could – in consultation with the Bureau of Indian Standards (BIS) and the Quality Council of India (QCI) – empanel a list of credible TIC firms for BRSR assurance. Further, it could consider including the representation of TIC firms in the Industry Standards Forum (ISF), to help inform further development of the BRSR indicators.
3. Introduce an indicator on assurance standard applied under general disclosures: The current BRSR format has two indicators on assurances: (i) name of assurance provider, and (ii) type of assurance obtained. SEBI could consider introducing a third indicator on ‘assurance standard applied’. While the independent assurance report filed alongside the BRSR report usually elaborates on assurance standards applied by the third-party verifier, the introduction of such an indicator, with machine-readable responses, within the BRSR general disclosures would help make cross-company comparisons easier for users, including investors.

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References:

1. Organisation for Economic Co-operation and Development (OECD). 2022. “Climate Change and Corporate Governance.” OECD Corporate Governance Working Papers No. 29. OECD Publishing. https://read.oecd-ilibrary.org/content/dam/oecd/en/publications/reports/2022/06/climate-change-and-corporate-governance_551e0831/272d85c3-en.pdf.
2. International Auditing and Assurance Standards Board (IAASB). 2024. “International Standard on Sustainability Assurance (ISSA) 5000: General Requirements for Sustainability Assurance Engagements.” International Federation of Accountants. https://ifacweb.blob.core.windows.net/publicfiles/2025-01/IAASB-International-Standard-on-Sustainability-Assurance-ISSA-5000.pdf
3. Securities and Exchange Board of India (SEBI). 2021. “Business Responsibility and Sustainability Reporting by Listed Entities.” Circular No. SEBI/HO/CFD/CMD-2/P/CIR/2021/562. SEBI. https://www.sebi.gov.in/legal/circulars/may-2021/business-responsibility-and-sustainability-reporting-by-listed-entities_50096.html
4. Securities and Exchange Board of India (SEBI). 2023. “BRSR Core – Framework for Assurance and ESG Disclosures for Value Chain.” Circular No. SEBI/HO/CFD/CFD-SEC-2/P/CIR/2023/122. SEBI. https://www.sebi.gov.in/legal/circulars/jul-2023/brsr-core-framework-for-assurance-and-esg-disclosures-for-value-chain_73854.html
5. International Auditing and Assurance Standards Board (IAASB). 2013. International Standard on Assurance Engagements (ISAE) 3000 (Revised): Assurance Engagements Other than Audits or Reviews of Historical Financial Information. International Federation of Accountants. https://www.iaasb.org/_flysystem/azure-private/publications/files/ISAE%203000%20Revised%20-%20for%20IAASB.pdf
6. Securities and Exchange Board of India (SEBI). 2025. “Measures to Facilitate Ease of Doing Business with Respect to Framework for Assurance or Assessment, ESG Disclosures for Value Chain, and Introduction of Voluntary Disclosure on Green Credits.” Circular No. SEBI/HO/CFD/CFD-PoD-1/P/CIR/2025/42. SEBI. https://www.sebi.gov.in/legal/circulars/mar-2025/measures-to-facilitate-ease-of-doing-business-with-respect-to-framework-for-assurance-or-assessment-esg-disclosures-for-value-chain-and-introduction-of-voluntary-disclosure-on-green-credits_93102.html
7. European Commission. 2025. “Omnibus Package.” European Commission News, April 1. https://finance.ec.europa.eu/news/omnibus-package-2025-04-01_en
8. Of the 5 top 1000 companies who didn’t file their BRSR reports in FY 2024-25, only two failed to comply with the SEBI mandate. Among the other three, two were exempted due to their recent mergers and one was exempted due to its recent migration from NSE Emerge (SME platform).
9. Top 1000 companies were determined as per NSE’s market capitalisation list dated 31 March 2024. National Stock Exchange of India Limited (NSE India (National Stock Exchange of India Limited). n.d. “Market Capitalisation of All Companies.” National Stock Exchange of India Limited. https://www.nseindia.com/static/regulations/listing-compliance/nse-market-capitalisation-all-companies
10. SEBI (Securities and Exchange Board of India). 2024. “Facilitating Ease of Doing Business with Respect to Business Responsibility and Sustainability Report (BRSR): Amendment to SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, and Issuance of Circular.” Meeting File. Securities and Exchange Board of India. https://www.sebi.gov.in/sebi_data/meetingfiles/dec-2024/1735040682024_1.pdf
11. Testing, Inspection and Certification (TIC) Council. n.d. “What Is the TIC Sector?” TIC Council. https://www.tic-council.org/about-us/what-is-the-tic-sector
12. Assurance Dimensions. n.d. “Limited Assurance vs. Reasonable Assurance Explained.” Assurance Dimensions. https://assurancedimensions.com/limited-assurance-vs-reasonable-assurance-explained/
13. Institute of Chartered Accountants of India (ICAI). 2025. Background Material on Sustainability and Business Responsibility & Sustainability Reporting (BRSR) (Revised Edition 2024). Sustainability Reporting Standards Board, ICAI. https://sustainability.icai.org/wp-content/uploads/2025/06/Background-Material-on-Sustainability-Business-Responsibility-Sustainability-Reporting-BRSR-Revised-Edition-2024.pdf