ESG vs Sustainability: How will Indian Boards Respond?
- esgnewsindia
- Sep 27, 2024
- 2 min read
A new PwC survey shows U.S. boards deprioritizing ESG, viewing it as separate from sustainability - but where India stands is less clear
Indian boards may need to accelerate their focus on ESG and sustainability to remain competitive
U.S. boards are pulling back from ESG, treating it as distinct from sustainability.
Indian boards are in the early stages of ESG adoption, but need to act fast as global expectations rise.
Lack of clear ESG strategies could put Indian companies at a competitive disadvantage globally.
A recent PwC survey reveals that U.S. boards are increasingly deprioritizing Environmental, Social, and Governance (ESG) initiatives, with many seeing them as separate from sustainability efforts. This shift is raising concerns about the future of corporate responsibility in America. As this trend unfolds, it’s worth asking: Are Indian boards making the same distinction? Or are they still at the early stages of adopting ESG as a key corporate priority?
This matters because ESG is fast becoming a global standard for evaluating corporate ethics, governance, and sustainability. Indian companies, which are often seen as lagging behind global trends, may struggle to catch up if they don’t integrate ESG into their core strategies. As the global business environment demands greater transparency and accountability, Indian boards must assess whether they are moving fast enough or risk falling behind in this critical area.
Technical Focus
India's focus on ESG is growing but remains in its infancy compared to Western counterparts. While some major Indian corporations are beginning to report on ESG metrics, widespread adoption is slow. The Securities and Exchange Board of India (SEBI) has introduced ESG reporting guidelines, but these are yet to be enforced rigorously. India’s sustainability reporting is still evolving, and more clarity is needed to distinguish between ESG and broader sustainability practices.
Further details from the PwC survey show that 64% of U.S. board members view ESG and sustainability as distinct concepts, which may hinder efforts to integrate these critical issues into business strategies. In India, where the conversation around ESG is still developing, companies risk repeating the same mistakes if they don’t view ESG as an integral part of their sustainability efforts. Indian companies have started to embrace sustainability, but many are yet to develop robust ESG frameworks that align with global expectations.
The urgency for Indian boards to adopt clear ESG strategies cannot be overstated. As international investors and partners increasingly demand ESG transparency, Indian companies will face growing pressure. If Indian boards do not act swiftly, they could miss out on opportunities for growth, while falling behind in a global market that increasingly values sustainable and ethical business practices.