Here is a scene playing out in plant offices and boardrooms across India right now. On Monday, a European customer emails a request: share your energy use, emissions, water consumption and workplace safety numbers for the last three years, with evidence. On Tuesday, the company’s auditors mention that some of the same figures will soon need an independent check as part of its regulatory filing. By Wednesday, the team is digging through spreadsheets, utility bills and emails from plant managers, trying to work out where each number actually came from.
This points to a simple shift: ESG numbers are no longer judged on whether they exist. They are judged on whether they can be proven. You don’t need an ESG background to follow this piece. If your business reports numbers to anyone, it applies to you.
What is actually changing?
India’s market regulator – SEBI – requires the top 1,000 listed companies to file a Business Responsibility and Sustainability Report, or the BRSR. Three things are tightening around it:
- Independent checking: A core set of nine measures, covering areas such as energy, water, emissions, waste and employee safety, must be verified by an independent provider, much like financial statements are audited. This requirement has been widening year by year and is set to cover the full top 1,000 by FY 2026-27.
- Reach beyond your own walls: Larger companies are being asked to report on their key suppliers and distributors, meaning those that make up 2% or more of purchases or sales. This is being phased in, starting with voluntary disclosure for the biggest companies, with independent checks to follow.
- Board ownership: The BRSR is now approved at board level and sits within the annual report. It is a governance document, not a sustainability brochure.
What “audit-grade” actually means
Keeping the jargons aside, let’s take a look at what audit-grade means. In simple terms, audit-grade is a number that someone else can check and get the same answer. Four quick tests show whether yours qualify:
- Traceable: Can you point to the bill, meter reading or record the number came from?
- Consistent: Is the same method used every year, and at every plant?
- Complete: Are all sites, units and time periods included, or only the easy ones?
- Repeatable: If a stranger did the calculation from scratch, would they reach the same figure?
Most companies pass one or two of these tests. Very few pass all four across every plant and supplier. The problems are rarely huge. Key numbers live in spreadsheets owned by one person. Estimates are used because real data is hard to collect. Different plants measure the same thing in different ways. Supplier information arrives as PDFs and email replies.
None of this mattered much when ESG was a voluntary story. It matters a great deal when an independent reviewer is asked to verify it.
The AI question
Many Indian enterprises are turning to AI to track emissions, water use and labour standards in near real time. That is a sensible move. AI is very good at collecting, cleaning and organising data quickly. But it does not remove the need for proof. If an AI tool produces a carbon figure, an auditor will still ask where the inputs came from and who checked the method. A fast number without a trail is still just a number. The companies that benefit most will use AI to build the trail, not to skip it.
Why this matters even if you are not listed
Many Indian businesses are not required to file a BRSR at all. But they supply to companies that are, or to European buyers with reporting duties of their own.
The EU has just published a simplified set of sustainability reporting standards. They cut the number of required data points and place limits on what large companies can demand from smaller suppliers. That is welcome relief. But it also means the requests you do receive will be more focused, and buyers will expect the answers to be solid. The supplier who can respond quickly and with evidence is fast becoming the supplier who wins the contract. What used to be a compliance chore is turning into a commercial advantage.
Three questions for leadership
- If an independent reviewer asked tomorrow for the source of our five most important ESG numbers, could we show them?
- Who owns this data? One accountable person, or scattered across plants, finance and sustainability teams?
- Could our key suppliers give us reliable numbers if asked, and could we give ours to our customers?
The bigger point
For years, the ESG question was: are you doing anything? Then it became: are you telling us? Now it is: can you prove it? Companies that build audit-grade data early will find every later requirement, from regulators, investors and customers alike, easier to meet. Those that don’t will end up rebuilding under pressure, with a deadline and a buyer waiting.
Audit-grade or nothing is not a slogan. It is where the market is heading.
Wondering how audit-ready your ESG data really is?Write to us at bhanukumar@avtarcc.com for a short conversation. We can walk through your key numbers, where they come from, and where the gaps are.
