INDIA’S BRSR–IFRS SUSTAINABILITY ALIGNMENT AND ITS IMPACT ON ESG REPORTING INVESTOR CONFIDENCE AND SUSTAINABLE CAPITAL FLOWS
DOI:
https://doi.org/10.53555/mm4fxv17Keywords:
ESG disclosure standards, IFRS, BRSR alignment, sustainable finance, emerging economiesAbstract
The shift towards sustainable finance has been accelerating globally. This has increased the pressure on financial institutions and countries, especially in emerging economies, to align operational and disclosure practices with international standards on ESG. This research investigates India’s Business Responsibility and Sustainability Reporting (BRSR) framework for its alignment with International Financial Reporting Standards for Sustainability (IFRS S1 and S2) along with what drives and what is the outcome of better harmonization of ESG disclosures. Data were collected through a three-pronged analytical framework consisting of gap analysis, investor philosophy analysis and regulatory landscape analysis covering 15 sectors. The research shows that the present BRSR is around 35% aligned to the IFRS S1 and S2 metrics presently. The degree of alignment varies considerably across sectors, ranging from 16% in oil, gas and consumable fuels, to 55% in chemicals. With sector specific tweaks and nine cross sectoral recommendations, 60% alignment potential. The study shows improved ESG disclosures significantly enhance investor confidence, reduces information asymmetry and helps in the flow of capital to sustainable firms. The establishment of regulatory cooperation, capacity-building of institutions, and periodic updating of the framework. The findings help to learn how emerging economies can strategically align domestic ESG frameworks with global standards to generate sustainable finance while remaining contextually relevant.
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