The Government of India notified the Securities and Exchange Board of India (Amendment) Regulations, 2023
The market regulator had come out with a consultation paper on the same in February.
The Government of India notified the Securities and Exchange Board of India (Credit Rating Agencies) (Amendment) Regulations, 2023, making rules and regulations for ESG Ratings providers (ERPs).
The amendment added a subchapter to the Securities and Exchange Board of India (Credit Rating Agencies) Regulations, 1999. The amendment lays the groundwork for rating agencies to become an ERP.
It sets guidelines and rules on the registration of ESG rating providers, eligibility criteria, conditions thereof, code of conduct, transparency, governance and prevention of conflict of interest, rating process and monitoring, review of ratings, the disclosure required, and applicability.
The market regulator had come out with a consultation paper on the same in February.
This came amid growing recognition of the significant economic and financial impact of climate change and environmental, social and governance (ESG) risks. Sebi has mandated the top 1,000 listed companies by market capitalisation to make filings as per the Business Responsibility and Sustainability Reporting (BRSR) from FY23.
“With the BRSR becoming mandatory from this financial year and a number of stakeholders such as investors and ESG rating providers placing reliance on disclosures made in the BRSR, assurance becomes key for enhancing credibility of disclosure and investor confidence,” Sebi had said in its consultation paper.
