IIM Ahmedabad to develop data product to help in ESG impact assessment

On the collaboration, Prof Bharat Bhasker, Director, IIMA said, “With ESG regulations becoming more stringent, the need for an efficient data infrastructure in the country has become critical. Reliable and accurate data is absolutely essential for the industry in nascent stages trying to adhere to the multiple ESG reporting frameworks in existence today. This collaboration will come up with outcomes that will offer effective solutions to ESG related challenges and allow all stakeholders to make informed decisions.”

One of the core principles of this project is to achieve two-way materiality – an aspect that has been stressed in the European Union’s new Corporate Sustainability Reporting Directive (CSRD) for reporting ESG standards.

Elaborating on this, Professor Anish Sugathan, Co-Chairperson, Arun Duggal CESGR said, “Two-way materiality requires assessment of the impact of ESG factors on a business as well as externalities caused by the company’s ESG activities. We intend to leverage our research capabilities to develop a framework that aligns with the principle of two-way materiality and help businesses stay ahead of the curve and further fuel the growth of the economy, at large. It can also be used by investors to rebalance their portfolio of investments and in general to understand the evaluation of the ESG ecosystem in the country.”

The capital market regulator, SEBI, has directed the top 1,000 listed companies (by market capitalization) to make ESG disclosures as per the Business Responsibility and Sustainability Reporting (BRSR) from FY 2022 – 23 onwards. In light of these mandates, the collaboration will contribute towards meeting the enhanced ESG data requirements of the Indian companies.

Avinash Gupta, Managing Director and CEO – India, Dun & Bradstreet said, “According to a recent Dun & Bradstreet survey highlighting top compliance and procurement challenges, 51 per cent respondents said that they need more data to verify entities and 43 per cent said that it is difficult to identify application of ESG guidelines within the due diligence process of the customer. Inefficient data usage and management are at the core of such challenges.”