S&P Global has ceased issuing ESG scores to Indian companies regulated by the Securities and Exchange Board of India (SEBI), following the implementation of stringent guidelines.
According to Environmental Finance, last July, SEBI introduced new rules mandating ESG rating providers to openly disclose their rating methodologies and incorporate ESG factors pertinent to the Indian context. This change aims to increase transparency and adaptability of ESG assessments to local conditions.
In response, S&P Global announced a strategic adjustment to their operations. “Following a review of the SEBI regulation on ESG rating providers, S&P Global is taking steps to restrict the provision of ESG scores on Indian companies within scope to users based in India for the purposes outlined by the law and associated guidance,” S&P Global stated. However, the firm will continue to provide ESG scores for scenarios that fall outside the purview of the SEBI regulations. This includes scores used internally by rated entities or for stakeholders located outside India.
This decision marks a significant shift in how financial data and ESG ratings are disseminated within the Indian market, potentially influencing future regulatory decisions and corporate strategies within the region.
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