The Securities and Exchange Board of India on 18 February constituted a working group to review the regulatory framework governing ESG Rating Providers (ERPs), which are agencies that rate companies based on environmental, social and governance standards.
The Press Release stated:
“The decision has been taken based on feedback received from market participants and stakeholders regarding the existing regulatory framework.”
The working group includes representatives from issuers, investors, domestic and global ERPs, ESG analysts, legal experts and academia.
It has been tasked with reviewing existing regulations, examining representations and suggestions from market participants, and recommending measures to enhance transparency, reliability and investor confidence in ESG ratings.
The group will also evaluate international regulatory developments and suggest ways India can align with global best practices while considering Indian market conditions.
The panel will submit its recommendations to SEBI for possible regulatory changes.