Quality Infrastructure

Quality Infrastructure. Environmental, Social & Governance (ESG) in Indian Regulatory Framework.

[Audio] In this presentation, we will discuss the basics and global trends of ESG, which stands for Environmental, Social, and Governance. ESG is a set of standards that companies use to evaluate their impact on society and the environment, as well as their governance practices. ESG has become increasingly important in recent years because it considers not only a company's financial performance, but also its social and environmental impact. The global business world has seen a significant shift towards ESG considerations, driven by factors such as consumer and investor demand for sustainability and a growing recognition of a company's impact on the environment and society. However, implementing and maintaining ESG standards comes with various challenges, such as data availability and quality, lack of standardization, and the complexity of ESG factors. To better understand ESG in practice, we will also be looking at case studies of how different industries have implemented ESG standards. We hope this presentation will provide valuable insights into ESG and its significance in the Indian regulatory framework. Please continue watching as we delve deeper into the topic of ESG and its impact on businesses and society..

[Audio] Slide number 3 out of 39 of our presentation on Quality Infrastructure and Environmental, Social & Governance (ESG) in the Indian regulatory framework will discuss the importance of ESG reporting in organizations. ESG reporting is the public disclosure of an organization’s environmental, social, and corporate governance data. The acronym "ESG" stands for the three main factors that determine a company's sustainability. ESG reporting is important because it promotes transparency into an organization's ESG activities and measures its sustainability performance, allowing stakeholders to make more informed decisions. In today's world, businesses are judged not only on financial performance, but also on their social and environmental impact. ESG reporting allows companies to showcase their commitment to responsible and sustainable practices, building trust with stakeholders and attracting investors and customers who prioritize ethical and sustainable companies. Additionally, ESG reporting helps organizations identify areas for improvement and set goals for a more sustainable future. By measuring and disclosing their ESG data, companies can track their progress and hold themselves accountable for their impact. In conclusion, ESG reporting is crucial for organizations to demonstrate their dedication to sustainable and responsible practices. It provides transparency, accountability, and has the potential to attract stakeholders who value ethical and sustainable business practices..

[Audio] In this slide, we see that ESG reporting has evolved from a voluntary to a mandatory measure in many regulatory frameworks, including the Indian market. Leading organizations and initiatives such as the SASB, the UN, and the UNPRI are driving this change. ESG regulations and reporting have seen significant growth globally, with the EU introducing their Sustainable Finance Action Plan in 2019 and the Sustainable Corporate Governance Directive in 2021. The Business Responsibility and Sustainability Reporting (BRSR) guidelines in India, launched in 2021, are based on internationally recognized frameworks. Looking ahead, we can see that ESG reporting is becoming mandatory through various initiatives and regulations, such as the EU's 2024 Corporate Sustainability Reporting Directive. It is crucial for businesses to understand and comply with the evolving regulatory landscape of ESG reporting as we move towards a more sustainable future. This transition is a reflection of the growing importance of ESG factors in the business world, and it is important for businesses to stay informed and adapt accordingly..

[Audio] In this slide, we will discuss important environmental terms and definitions related to ESG in India's regulatory framework. First, we will cover the concept of Net Zero, which aims to achieve a balance between greenhouse gas emissions and removal from the atmosphere. This is a crucial goal for organizations and countries in order to combat climate change and reduce their impact on the environment. Next, we will discuss Biodiversity, which refers to the variety and variability of life on Earth and is essential for environmental sustainability. It encompasses all living organisms and their ecosystems and plays a significant role in maintaining the health of our planet. Renewable Energy is another vital term gaining momentum in India and globally, referring to energy obtained from renewable sources such as solar, wind, and hydro power. This clean and sustainable form of energy is crucial in reducing our reliance on fossil fuels and decreasing our carbon footprint. The Circular Economy is an economic model that emphasizes minimizing waste through recycling, reusing, and reducing resource consumption. This is an essential concept for businesses to adopt in promoting sustainable and responsible practices. Climate Risk refers to the risks posed to organizations by climate change, including both physical and transition risks. As the impacts of climate change become more apparent, it is crucial for businesses to assess and manage these risks to ensure long-term success. Taxonomy is a classification system that defines economic activities aligned with a net zero trajectory by 2050 and other environmental goals. It is a critical tool in promoting sustainable and responsible investments and practices. Lastly, Emission Scopes refer to different categories of greenhouse gas emissions, including direct emissions from owned or controlled sources (Scope 1), indirect emissions from purchased electricity, steam, or heating (Scope 2), and all other indirect emissions in the value chain (Scope 3)..

[Audio] This is slide number six of our presentation on Quality Infrastructure and the Environmental, Social & Governance (ESG) in the Indian Regulatory Framework. The focus of this slide is on basic carbon terms that are essential knowledge. Understanding these terms is crucial in comprehending the impact of human activities on the environment and the efforts being made to combat climate change. The first term, carbon footprint, refers to the total amount of greenhouse gas emissions, mainly carbon dioxide, released into the atmosphere as a result of human activities. Next, we have carbon neutrality, which is the process of achieving a balance between the amount of carbon dioxide being emitted and removed from the atmosphere. This is an important step in reducing our carbon footprint and promoting environmental equilibrium. Carbon offsetting is the practice of compensating for emissions by investing in projects that work towards reducing or capturing an equivalent amount of greenhouse gases. This helps to maintain a balance in the environment. Another important term is carbon sequestration, which refers to the process of trapping carbon dioxide through methods such as reforestation, soil improvement, or technology. This helps in decreasing the amount of carbon in the atmosphere and fighting against climate change. Carbon trading is a market-based approach in which companies can buy and sell permits that allow them to emit a certain amount of greenhouse gases. This incentivizes companies to reduce their carbon footprints. Carbon pricing is the practice of placing a monetary cost on carbon emissions to encourage businesses and individuals to decrease their carbon footprints. This can aid in mitigating the effects of climate change. Decarbonization is the process of reducing carbon emissions from various sectors such as energy, transportation, and industry. This is crucial in our fight against climate change. Carbon disclosure is the practice of companies revealing their carbon emissions and risks related to climate to investors and the public. This promotes transparency and accountability in environmental initiatives. Governments also play a significant role in reducing carbon emissions through measures such as a carbon tax..

[Audio] Slide number 7 of our presentation is about Quality Infrastructure and Environmental, Social & Governance (ESG) in the Indian Regulatory Framework. Today, we will discuss important social terms and definitions that are crucial for companies in the corporate world. These terms are essential for companies to understand and incorporate in their operations. The first term is Corporate Social Responsibility (CSR), which refers to a company's initiatives and programs that have a positive impact on society. These initiatives can include community development programs and environmental sustainability efforts. Human Rights are another crucial term that refers to fundamental rights and freedoms that all individuals are entitled to. This encompasses fair labor conditions, which is an important aspect of social responsibility for any organization. Diversity, Equity, and Inclusion (DEI) is a term that encompasses policies and initiatives that promote diverse representation, equitable opportunities, and inclusive environments. Companies that prioritize DEI are more likely to have a positive impact on society and their employees. Health & Safety is also important and includes measures to protect the well-being and safety of employees, customers, and stakeholders. This can involve implementing proper safety protocols in the workplace and providing appropriate health benefits for employees. Employee Well-being is crucial and includes programs that enhance the mental, physical, and financial health of employees. Prioritizing employee well-being has been shown to increase employee satisfaction and productivity. Stakeholder Engagement is another important term that refers to the collaborative efforts between the organization and individuals or groups affected by its activities. This can include customers, employees, and community members. Lastly, Labor Standards are guidelines that ensure fair treatment, proper wages, and ethical working conditions for employees. Companies that prioritize labor standards not only benefit their employees but also contribute to a more sustainable and just society. In conclusion, understanding and incorporating these social terms and definitions is crucial for companies to be socially responsible..

[Audio] We will now discuss various terms and definitions related to corporate governance and ESG in the Indian regulatory framework, starting with corporate governance. This refers to the set of rules, practices, and processes that direct and control a company, ensuring responsible and ethical operations with a focus on long-term success. Next, board diversity highlights the importance of diverse backgrounds, gender, and expertise on the board for inclusive decision-making processes. Transparency is also crucial, as it involves open communication about the company's operations, decision-making, and financial performance to foster trust and accountability. ESG reporting involves disclosing a company's environmental, social, and governance performance and risks to help stakeholders make informed decisions. Risk management is essential for identifying, assessing, and mitigating potential risks that could impact the company's sustainability and success. Anti-corruption policies are necessary to prevent unethical practices, while shareholder rights provide legal protections and access to relevant information. Ethical supply chains prioritize responsible sourcing and procurement practices, including fair labor, environmental sustainability, and human rights. Lastly, we will define "greenwashing", which refers to the deceptive practice of falsely presenting a company as environmentally friendly..

[Audio] Slide 9 out of 39 discusses the significance of ESG in the Indian regulatory framework. ESG, which stands for Environmental, Social & Governance, has become increasingly important for businesses and organizations of all sizes and industries. It encompasses various factors such as environmental impact, social responsibility, and corporate governance. Incorporating ESG practices is crucial in minimizing risks to a company's reputation, operations, and finances, especially in today's constantly changing business landscape. In addition, ESG has the potential to attract investment, as investors are seeking businesses with a commitment to sustainability and long-term growth. ESG practices have also been proven to improve financial performance by reducing costs and increasing efficiency, benefiting both the company and the overall economy. ESG also ensures compliance with current regulations, avoiding penalties and legal issues. Furthermore, it serves as a powerful tool for building a strong brand and reputation by demonstrating a commitment to sustainability and attracting customers, employees, investors, and other stakeholders. ESG also meets the expectations of stakeholders, as consumers and investors increasingly prioritize sustainability and social responsibility. By incorporating ESG, companies can build long-term relationships and demonstrate commitment to these values. Overall, ESG supports long-term resilience and is a crucial aspect of the Indian regulatory framework..

[Audio] In this session, we will be discussing ESG Basics and Global Trends. This is Slide 10 of our presentation, which focuses on Quality Infrastructure and its connection to Environmental, Social, and Governance or ESG in the Indian Regulatory Framework. ESG stands for Environmental, Social, and Governance and it refers to the three main factors that measure the sustainability and ethical impact of an investment in a company or business. It is an important framework that helps evaluate the non-financial performance of a company, in addition to its financial performance. The significance of ESG lies in its ability to measure the impact of a company on the environment, society, and its governance practices. By incorporating ESG criteria into their investment decisions, investors can ensure that their investments are not only financially sound, but also responsible and sustainable. Looking at the global trends in ESG, we see that the key drivers are mounting concerns over climate change, social injustice, and corporate governance failures. This has led to a rise in demand for responsible and sustainable investments. However, there are also challenges, such as lack of standardization and inconsistent reporting. To better understand the practical application of ESG, we will discuss case studies on how different industries are incorporating ESG principles into their practices, and how it has yielded positive results for both the company and the environment. Moving on, we will further explore the Indian Regulatory Framework and its connection to ESG. Let's continue our journey towards understanding and implementing ESG in the Indian context..

[Audio] Slide number 11 out of 39 is focused on Quality Infrastructure and its relationship to Environmental, Social & Governance (ESG) in the Indian Regulatory Framework. Quality Infrastructure plays a vital role in ensuring the safety, reliability, and sustainability of products and services across all industries. This includes the establishment of systems, processes, and standards to maintain consistency and high-quality outputs. The Indian Regulatory Framework has a growing emphasis on incorporating ESG principles into business practices. ESG considers the environmental, social, and governance factors that are critical for companies to address. These factors not only impact their bottom line, but also have a significant impact on society and the environment. The slide highlights the various codes and regulations implemented to address ESG concerns, such as the Corporate Social Responsibility (CSR) provisions and the National Voluntary Guidelines on Social, Environmental and Economic Responsibilities of Business. These initiatives strive to promote sustainable and responsible practices within companies and align them with the goal of sustainable development. By including ESG principles in the Indian Regulatory Framework, the government is encouraging a more responsible and sustainable approach to business. This has a positive impact on the economy, as well as the environment and society. Quality Infrastructure and ESG principles work hand in hand to ensure sustainable and responsible practices in the Indian Regulatory Framework. By implementing and adhering to these standards, businesses can not only improve their operations but also contribute to the larger goal of a more sustainable future..

[Audio] We are currently on slide 12 out of 39 in our presentation on Quality Infrastructure and Environmental, Social, and Governance (ESG) within the Indian Regulatory Framework. Today, we will discuss the growth of ESG and sustainability policies over time and their impact on different world regions. ESG and sustainability have become increasingly important in the business world in recent years, as companies are now expected to prioritize their impact on the environment and society, in addition to their financial performance. In India, the development of ESG policies dates back to the early 2000s, with a focus on sustainable development. Over time, these regulations have become more stringent, with the Securities and Exchange Board of India (SEBI) playing a significant role in promoting responsible investing through ESG considerations. This trend is not just limited to India, as ESG and sustainability policies have gained global momentum. A study by the United Nations Principles for Responsible Investment found that many countries, particularly in Europe and North America, have made ESG considerations a standard practice. This growth highlights the increasing awareness and importance of sustainable and responsible practices in the business world. It also demonstrates how ESG and sustainability have become a key factor in decision-making for investors and stakeholders. Moving forward, companies must integrate ESG considerations into their business strategies and operations in order to remain competitive and contribute to a better, more sustainable future. Let's now move on to the next slide to explore the specific ESG regulations in India and their impact on the business landscape..

[Audio] Slide number thirteen of our presentation focuses on the transition from fossil fuels, a crucial aspect of the global climate crisis. Nearly 200 countries have recognized the need to move towards cleaner energy sources, a significant step in combating climate change. Delegates have agreed to triple global renewable energy capacity and double energy efficiency by 2030, with developed nations pledging to provide financial support for climate action in developing countries. This includes an annual commitment of at least $100 billion by 2025 and $5-7 trillion by 2030. A new fund has also been established to address losses and damages faced by vulnerable countries due to climate impacts. This highlights the global concern for the well-being of all nations. It is imperative that we take urgent action to transition from fossil fuels in order to protect our planet and future generations. Let us continue to work towards these targets and create a better, greener world..

[Audio] Slide number 14 of our presentation discusses Quality Infrastructure and Environmental, Social & Governance (ESG) in the Indian Regulatory Framework. The issue of climate change is a key topic in global discussions as we strive towards a more sustainable future. At the recent United Nations Climate Change Conference, significant agreements were made with a focus on developing nations. One such agreement entails developed countries committing to increase climate finance for developing nations. By 2035, the goal is to allocate at least $300 billion annually towards this cause. This financial support will play a critical role in reducing greenhouse gas emissions and aiding developing nations in adapting to the consequences of climate change. Additionally, a comprehensive rulebook for carbon credits was approved at the conference, providing an essential framework for supporting climate projects financially and enhancing transparency in carbon markets. The conference also emphasized the importance of adaptation strategies, highlighting the need to scale up efforts to protect vulnerable communities from the adverse effects of climate change. This is a crucial step in ensuring that those most affected by a changing climate receive the necessary support and resources. It is clear that the global community is taking actionable measures towards creating a more sustainable future. The agreements made at the recent conference demonstrate a strong commitment to enhancing climate finance, promoting transparency in carbon markets, and prioritizing adaptation strategies. The presentation will now continue with slide number 15..

[Audio] Slide number 15 of our presentation on Quality Infrastructure and Environmental, Social & Governance (ESG) in Indian Regulatory Framework discusses recent developments in South Africa regarding mandatory ESG reporting. Currently, South Africa is in the process of implementing legislation that will make ESG reporting mandatory within the next 18 months. The Companies Amendment Bill, introduced in August of 2023, proposes updates to the Companies Act, including new provisions related to ESG. In October of 2024, the Companies and Intellectual Property Commission (CIPC) added a sustainability disclosures module to its XBRL taxonomy, aligned with the International Sustainability Standards Board's (ISSB) IFRS S1 and IFRS S2 standards. While currently voluntary, it is expected to become mandatory in the future. This movement towards mandatory ESG reporting is in line with existing frameworks in South Africa such as the King Code on Corporate Governance and the Johannesburg Stock Exchange's (JSE) sustainability disclosure guidelines, which prioritize ethical practices, transparency, and effective leadership. In conclusion, South Africa's developments in ESG reporting demonstrate their commitment to promoting responsible and sustainable business practices. By aligning with international standards and implementing mandatory reporting, South Africa is taking a significant step towards creating a more sustainable and ethical business environment..

[Audio] In this presentation, we will be discussing how Brazil has integrated ESG criteria into their laws and guidelines. ESG principles are becoming increasingly important for businesses and governments around the world. Brazil has taken a proactive approach in promoting sustainable practices by implementing ESG criteria into various laws and regulations. The Public Procurement Law (Law 14.133/2021) is an example of Brazil's efforts, as it includes criteria such as environmental impact assessment, energy and natural resource consumption reduction, and social inclusion by requiring companies to hire individuals from marginalized groups. The Brazilian Securities and Exchange Commission (CVM) has also established guidelines for the disclosure of sustainability information on the capital markets through its resolution 193, promoting transparency, and environmental and social responsibility. These actions by Brazil set an example for other countries to follow and demonstrate their commitment to a more sustainable and socially responsible future. We will now move on to explore the ESG initiatives and regulations in another country on slide number 17..

[Audio] In this presentation, we will be discussing the intersections of Quality Infrastructure and the Environmental, Social & Governance (ESG) landscape in India. We will be focusing on the role of ESG in the Indian regulatory framework, starting with a look at Singapore. In July 2022, the Monetary Authority of Singapore (MAS) issued a circular on the Disclosure and Reporting Guidelines for Retail ESG Funds. This circular requires fund managers to disclose the fund's ESG focus, criteria, methodologies, and metrics to provide transparency to investors and encourage sustainable investing strategies. Singapore is also taking a step further in promoting ESG by developing mandatory Climate-Related Disclosure (CRD) standards, based on the ISSB guidelines, to improve transparency and accountability in climate-related disclosures. This proactive approach serves as an example for other countries to follow in incorporating ESG into their regulatory frameworks, ultimately benefiting investors and having a positive impact on the environment and society. Thank you for listening, let's proceed to the next slide..

[Audio] We will be discussing the topic of Environmental, Social and Governance (ESG) in the Indian Regulatory Framework. The following slide presents statistics on the disclosure of sustainability information by listed companies, derived from the OECD Corporate Governance Factbook 2023. Only 19% of listed companies globally have disclosed their sustainability performance in 2021, which is concerning. ESG information is crucial for corporate reporting and provides insights into a company's practices. It has a significant impact on financial performance and investor decision-making. The data shows a disparity in ESG reporting across different regions, with China at 17% and Europe at 34%. Although there has been an increase in disclosure, the number of listed companies globally remains low. It is important for companies to transparently report their ESG performance as we prioritize sustainable practices. Let us now move on to the next slide to further explore ESG in the Indian Regulatory Framework..

[Audio] This presentation will discuss the difference between CSR and ESG in the Indian regulatory framework. CSR takes a qualitative approach to improve a company's image and show their dedication to social responsibilities. ESG reporting, on the other hand, has a more quantitative approach, focusing on the impact of a company's actions on climate, income inequalities, and other societal issues. Another distinction is that CSR is a voluntary choice, while ESG reporting is a mandatory obligation. Additionally, CSR mainly concerns legal and ethical implications, while ESG reporting focuses on environmental and social risks. Furthermore, ESG reporting involves standardized questionnaires and rating forms to assess a company's compliance. Lastly, CSR highlights a company's values, while ESG reporting focuses on measurable risks. In conclusion, while both CSR and ESG have a common goal, they differ in their approaches and specific focus areas within the Indian regulatory framework..

[Audio] Slide number 20 of our presentation on Quality Infrastructure and Environmental, Social & Governance (ESG) in the Indian Regulatory Framework will discuss the evolution of regulations for non-financial disclosures in India. In 2015, SEBI introduced the mandatory Business Responsibility Report (BRR) guidelines, based on the National Voluntary Guidelines. These guidelines were initially required for 100 companies in 2012 and were later extended to the top-500 companies in 2015 and top-1000 companies in 2019. In 2017, the Insurance Regulatory and Development Authority (IRDAI) mandated the Stewardship Code for insurance companies in their investment activities. Similarly, SEBI introduced integrated reporting for listed entities in the same year, with voluntary adoption for the top-500 listed companies. In 2019, SEBI made it mandatory for entities raising green debt or green bonds to disclose their use of proceeds. The Stewardship Code was also implemented for all Mutual Funds and categories of Alternative Investment Funds by SEBI in 2020, in relation to their investment in listed equities. And most recently, in 2021, the Ministry of Corporate Affairs introduced the Committee of Business Responsibility Reporting and the Sustainability Reporting Standards Board. This will be rolled out in phases between 2021-2023, with mandatory disclosure for the top-1000 listed companies based on their market cap. It is evident that the Indian regulatory framework is continuously evolving to incorporate ESG disclosures and promote responsible practices among businesses. Please continue to follow our presentation for more information on this important topic..

21. ESG Status in Indian Market. India Perspective - ESG Scenario.

[Audio] Slide number 22 is part of a presentation on Quality Infrastructure and ESG in the Indian Regulatory Framework. Today we will be discussing the importance of ethical business practices and how they contribute to building a 100% compliant company. We strongly believe in promoting ethical practices and have established a governance framework to ensure integrity and transparency in our operations. Through our policies and processes, we uphold human rights and ethical standards. In line with this, we have joined global coalitions such as the United Nations Global Compact (UNGC) and the International Finance Corporation (IFC) Performance Standards to stay updated on global ethical standards and improve our performance. Our focus on product stewardship includes a strong framework for responsible and sustainable production. We also prioritize supply chain sustainability to ensure ethical and sustainable production of our products. Our company prioritizes the well-being and engagement of our employees by providing a safe workplace and investing in their human capital development. In terms of environmental stewardship, we are committed to upholding the principles of the National Green Building Code (NGBC) and advocate for public policies that promote sustainability. We actively engage with local communities to ensure a positive impact on the environment, which enhances our brand reputation and attracts stakeholders who share our values. Through an inclusive and equitable approach to ESG implementation, we strive to become an environmentally compliant company with a goal of achieving carbon and water neutrality. We have processes for waste and biodiversity management and prioritize public advocacy on global sustainability issues. To enhance customer engagement, we have also implemented policies for cyber security and data privacy..

[Audio] We will now be discussing slide number 23 which highlights the impact of Environmental, Social, and Governance (ESG) on Indian businesses. The Indian government recognizes the growing importance of ESG and has taken steps to strengthen its regulatory framework, including initiatives such as the Corporate Social Responsibility law and the Sustainable Development Goals. By incorporating ESG principles, businesses can contribute to a more sustainable and ethical society and improve their long-term success. Let's move on to our next slide for a deeper understanding of Quality Infrastructure..

State Performance in SDG goals (2023-2024). Source: https://pib.gov.in/PressReleasePage.aspx?PRID=2032857.

[Audio] Slide number 25 discusses key changes in the Indian regulatory framework for Quality Infrastructure and Environmental, Social & Governance (ESG). These changes, outlined in the SEBI (Listing Obligations and Disclosure Requirements) Regulations, aim to improve ESG reporting for listed entities and their value chain partners. The first change is the deferral of ESG disclosures for value chain and the "assessment or assurance" by one year. This means that ESG disclosures for value chain will now be required from FY 2025-26 instead of FY 2024-25, and "assessment or assurance" will be applicable from FY 2026-27 instead of FY 2025-26. In addition, ESG disclosures for value chain are now optional instead of the previous "comply-and-explain" requirement. Listed entities have the choice to disclose their value chain's ESG practices or not. The scope of value chain has also been reduced to only include the top upstream and downstream partners of a listed entity, individually comprising 2% or more of the listed entity's purchases and sales. However, listed entities can choose to limit their value chain disclosure to cover 75% of their purchases and sales. A new leadership indicator has been introduced in Principle 6 of the Business Responsibility and Sustainability Reporting (BRSR) for disclosure of Green Credits generated or procured by the listed entity and its top-10 value chain partners. The term "assurance" has been replaced with "assessment or assurance" in the SEBI (Listing Obligations and Disclosure Requirements) Regulations. This means that "assessment" will be a third-party assessment conducted according to standards developed by the Industry Standards Forum (ISF) in consultation with SEBI. This will apply to BRSR Core disclosures for listed entities and value chain from FY 2024-25 and FY 2026-27 onwards, respectively. These changes aim to strengthen the reporting and accountability of ESG practices in the Indian regulatory framework. Please refer to slide number 25 for more information..

[Audio] The impact of climate change and the role of businesses in addressing it has led to a growing trend in net-zero pledges. Currently, 929 Forbes 2000 companies have set net-zero targets as of June 2023, which is more than double the number of companies that had pledged to achieve net zero by December 2020. Along with the increase in companies, the revenue under these net-zero targets has also significantly grown from $3.8 trillion to $26.4 trillion in just two years. This indicates that companies are not just making promises, but also taking concrete actions towards building a more sustainable future. These global trends in environmental, social, and governance (ESG) practices, particularly in the area of net-zero, highlight the importance of prioritizing ESG factors in business operations and decision-making. As stakeholders become more conscious of the impact of their investments, companies that align with ESG principles and have net-zero targets are likely to receive increased support and growth in the long run. It is crucial for businesses to not only focus on financial performance, but also on their ESG practices as we move towards a more sustainable future. This shift is evident in the increasing number of net-zero pledges and significant growth in revenue under these commitments, emphasizing the significance of ESG considerations in the Indian regulatory framework. This signals a move towards a more environmentally conscious and responsible global economy..

[Audio] Countries around the world are making commitments to increase their use of nuclear power as part of a shift towards cleaner and more sustainable energy sources. 22 countries, including the US, Canada, Japan, the UK, France, and the UAE, have pledged to triple their nuclear generation by 2050 and align with the clean energy targets outlined in the 2015 Paris Agreement. The UK government has announced plans for the country's largest expansion of nuclear power in 70 years, in an effort to increase energy independence and reduce carbon emissions. India has also set a goal to triple their nuclear power generation capacity to 22,480 MW by 2031, in line with a global trend towards sustainable and environmentally-friendly practices in the energy sector. As a result, Environmental, Social, and Governance (ESG) principles are becoming increasingly important in the nuclear energy industry. Strong regulatory frameworks are necessary to support this shift towards cleaner and more sustainable energy sources. With this in mind, our final slide will discuss the Indian Regulatory Framework for ESG in the nuclear energy sector. This framework promotes responsible and sustainable practices and plays a crucial role in achieving India's goal of tripling their nuclear power generation capacity by 2031. Let's now move on to our next slide..

[Audio] Slide number 28 will be discussing the important topic of Carbon Border Adjustment Mechanism (CBAM). Carbon pricing has become an effective tool in managing emissions and addressing climate change. In May 2023, the European Union adopted the CBAM, which imposes tariffs on carbon-intensive imports and requires accurate emissions reporting. This is a significant step towards creating a more sustainable and environmentally responsible global economy. The implementation of CBAM began in October 2023 and full requirements will start in 2026. This demonstrates the EU's proactive approach towards reducing carbon emissions and promoting green practices, highlighting the growing importance of ESG in regulatory frameworks. The UK also plans to introduce a carbon border tax in 2027, further solidifying the global trend in ESG policies. This development emphasizes the increasing focus on sustainability and the urgent need to reduce carbon footprints. Deutsche Bank's Flow team is actively involved in supporting and providing guidance in carbon tax calculation and accounting. As the ESG landscape continues to change, it is crucial to stay updated and compliant to make a meaningful impact. In conclusion, the CBAM is a critical step towards a more sustainable and greener future. We must recognize and adapt to the global trends in ESG for the betterment of our present and future generations..

[Audio] Slide 29 of the presentation on Quality Infrastructure and ESG in Indian Regulatory Framework examines the key drivers of ESG. In today's rapidly changing world, it is crucial for organizations to display a strong dedication to environmental, social, and governance practices. The first driver of ESG is regulatory requirements. With stricter regulations, organizations must adhere to ESG standards to avoid legal and financial risks. This not only ensures compliance, but also showcases a responsible approach towards sustainability. The second driver is investor expectations. With a growing emphasis on sustainability and ethical practices, investors now seek ESG disclosures to assess potential risks and incorporate them into their investment strategies. This creates a mutually beneficial situation for both organizations and investors. The third key driver is market competitiveness. Strong ESG practices not only enhance brand equity, but also drive customer loyalty and competitiveness. Companies committed to sustainability and responsible business practices have a competitive edge in the market, attracting more customers and driving growth. The fourth driver is risk management. ESG initiatives help organizations effectively mitigate environmental, social, and governance risks. By proactively addressing potential risks, companies can avoid damage to their reputation and financial stability. The fifth driver is access to capital. Organizations with strong ESG practices are more likely to attract favorable loans and investments, providing financial support and further validating their commitment to sustainability. The sixth driver is consumer demand. Responsible brands are preferred by consumers, driving the adoption of ESG practices. With the rise of conscious consumerism, it is essential for organizations to demonstrate their commitment to sustainability to maintain customer trust and loyalty. The seventh driver is employee retention and attraction. ESG frameworks not only improve employee retention, but also attract top talent. Employees want to work for organizations that align with their values and beliefs, and a strong commitment to ESG is a major drawing point..

[Audio] Slide 30 out of 39 highlights the key challenges of ESG. Many organizations are now recognizing the significance of Environmental, Social, and Governance (ESG) in their operations. However, this understanding also brings a variety of obstacles that need to be addressed. One of the main challenges is the shortage of qualified professionals with expertise in ESG. This can hinder an organization's efforts to implement sustainable practices and comply with ESG regulations. The absence of a universal ESG framework and standardization can also create inconsistencies and confusion in terms of compliance, emphasizing the need for qualified professionals to navigate the complexities of ESG. Additionally, collecting accurate ESG data, particularly for Scope 3 emissions, can be a difficult and resource-intensive task. This can lead to gaps in data and hinder the effectiveness of ESG initiatives. Moreover, the high initial investments in sustainable practices and technology can be a barrier for organizations looking to implement ESG strategies, especially for smaller companies with limited resources. Compliance with ESG can also be a complex process when dealing with global supply chains, as ensuring all parts of the supply chain are in line with ESG standards can be time-consuming and resource-intensive. Varying ESG regulations across different regions can further complicate compliance efforts and create uncertainty for organizations, highlighting the need for a unified and standardized approach to ESG. The risk of greenwashing, where organizations make false or exaggerated ESG claims, can harm a company's reputation when exposed. Therefore, it is essential for organizations to have genuine commitment to ESG principles. Moreover, stakeholders may struggle to balance short-term costs with long-term ESG benefits. This is why education and awareness about the long-term benefits of ESG initiatives are crucial. Lastly, cultural and geographic differences can create resistance to adopting ESG, as different parts of the world may have varying norms and attitudes towards it, making it challenging for organizations to implement consistent practices..

[Audio] Our presentation on Quality Infrastructure and Environmental, Social & Governance (ESG) in the Indian Regulatory Framework will be discussing the basics of ESG and global trends. ESG is an acronym for environmental, social, and governance, and is used to evaluate the sustainability and ethical practices of a company or organization. This is gaining importance globally as it considers not only financial performance, but also the impact of a business on the planet and society. Global trends in ESG show a significant increase in attention and focus over the years, due to key factors such as growing environmental concerns, increasing social awareness, and changing investor expectations. However, there are challenges such as lack of standardization and data availability. To better understand the implications of ESG, we will be looking at case studies on sectoral interpretation to provide a practical perspective on how ESG is being implemented in different industries. It is crucial for companies to prioritize and integrate ESG practices in their operations. Our hope is that this session has provided valuable insights on ESG basics and global trends, and we look forward to our following sessions on ESG in the Indian Regulatory Framework..

[Audio] This slide discusses the importance of transportation efficiency and its impact on the environment. Did you know that transportation activities contribute to almost 30% of US greenhouse gas emissions, making it a significant contributor to climate change? This highlights the urgent need for companies to address their transportation practices. For a company like UPS, which distributes goods across regions, transportation activities make up the majority of their greenhouse gas emissions. Therefore, it is crucial for organizations like UPS to implement sustainable transportation practices. One solution that UPS has adopted is an AI system called ORION, which aims to minimize the number of turns during deliveries, thus reducing fuel consumption. This initiative was implemented in 2012 and has resulted in saving UPS 10 million gallons of fuel per year. Not only does it bring financial benefits, but it also reduces UPS's carbon footprint by 100000 metric tons per year. This is equivalent to removing more than 20000 cars from the roads, as an average car emits 4.6 metric tons of GHG per year. In addition to private solutions like ORION, there are also public cloud route optimizer systems that businesses can use without having to build their own hardware. These tools can be leveraged as a service, with companies paying a subscription cost. In conclusion, improving transportation efficiency is crucial for companies like UPS to maintain environmental sustainability. With solutions like ORION, businesses can decrease their environmental impact and save on costs. Now, let's move on to our next slide on UPS ORION and its benefits..

[Audio] Slide 33 of our presentation focuses on the impact of Environmental, Social & Governance (ESG) in the Indian Regulatory Framework and the importance of Quality Infrastructure. It is essential to understand the urgency of the current state of our resources, as studies show that by 2023, our consumption will exceed the Earth's ability to generate new resources in one year. Our current economic model of producing, using, and disposing is not sustainable and that is where the concept of circular economy comes in. Circular economy is a trending solution that focuses on utilizing waste as raw materials through methods such as recycling, repairing, and reusing existing products. A successful example of this is H&M's "Let's Close the Gap" project, launched in 2013, where discarded clothing is collected and either restored and given to a new owner or recycled for new products. H&M also incentivizes customers to bring in their old clothes by offering tokens for discounts at their stores, creating a complete circular economy loop. In 2019, 57% of H&M's raw materials were sustainable and they aim to improve this number to 100% by 2030. This showcases H&M's commitment to a more sustainable future. The company's deposit scheme for gathering raw materials is a leading example of promoting circular economy and reducing the impact of fast fashion on the environment. Let's now continue to slide 34..

[Audio] Slide number 34 of our presentation is focused on the crucial role of finance companies in promoting sustainable business practices within the Indian Regulatory Framework. It is a well-known fact that the world is currently facing both environmental and social challenges that must be addressed. As responsible businesses, it is our obligation to work towards a more sustainable future. However, this transition requires significant investments and resources. This is where finance companies play a critical role. Through their support of initiatives by responsible businesses, they can accelerate the shift towards sustainable practices. Our company, HSBC, recognizes this responsibility and has committed to investing $100 billion in sustainability projects by 2025. This significant contribution will not only benefit the environment but also support the development of responsible businesses. Our efforts in ESG have been recognized with an AA rating by MSCI, a global leader in ESG ratings and research. Beyond investments, our company is actively working towards the goal of using 100% renewable energy for our electricity needs by 2030. This will greatly reduce our carbon footprint and contribute to a greener future. In addition, we are constantly finding ways to reduce our consumption of paper and single-use plastic packaging for coffee and beverages. As a large corporation, it is our responsibility to actively work towards reducing our impact on the environment. Our efforts have been acknowledged by many, with HSBC being listed as a sustainability case study by AIMultiple. Our ESG practices have also received positive attention, with our focus on green finance being a major contributing factor. In conclusion, at HSBC, we are committed to driving sustainable practices and making a positive impact on the environment and society. We consider it our responsibility as a leading finance company to support and promote responsible businesses for a better tomorrow..

[Audio] Slide number 35 of our presentation discusses Swire Properties' efforts to reduce greenhouse gas emissions in China and Hong Kong through the use of sustainable practices. In 2018, they completed the construction of One Taikoo Place, a green building that aligns with the company's sustainability goals. 3D modeling techniques are used to optimize energy efficiency, while smart lighting systems with sensors reduce electricity consumption. The building also has a biodiesel generation system that converts waste food oil into biodiesel. Additionally, low-carbon embedded materials and recycled materials are incorporated in their construction process as part of their commitment to sustainability. These efforts have resulted in a nearly 20% reduction in GHG emissions intensity across their entire portfolio. By utilizing digital technologies and low-carbon materials, Swire Properties has successfully minimized their GHG emissions and is leading the way towards a greener and more sustainable future. Stay tuned for further discussions on Quality Infrastructure and ESG in the Indian Regulatory Framework..

[Audio] This presentation will cover Quality Infrastructure and Environmental, Social & Governance (ESG) in the Indian Regulatory Framework. We will discuss One Taikoo Place, a project designed by Wong & Ouyang (HK) Ltd. We are now at slide 36 out of 39, where we will highlight the unique features of this commercial building. These include expansive glass walls for natural light and stunning views of Victoria Harbour. One Taikoo Place is a key part of our Taikoo Place redevelopment and is surrounded by air-conditioned walkways and beautiful gardens with water features. It stands out for its commitment to green building and wellness standards. It has been recognized as the first commercial building in Asia to achieve WELL Core & Shell Version 1 Final Platinum Certification, and the first to be awarded triple Platinum ratings for WELL, BEAM Plus, and LEED Final Platinum certifications in Hong Kong. The building also leads in sustainable energy practices, being the first in the city to use a waste-to-energy biodiesel tri-generation and adsorption system for heating, cooling, and power. It also features a dual-level roof with green roof and solar PV system, making it one of the city's first commercial projects to do so. In summary, One Taikoo Place is a testament to our dedication to quality infrastructure and ESG principles. We hope this presentation has given you a better understanding of our values and accomplishments. Thank you for your attention and we are happy to answer any questions..

[Audio] The concept of Quality Infrastructure is essential for the growth and sustainability of any economy. In line with this, our focus today is on the Environmental, Social, and Governance (ESG) aspect of Quality Infrastructure in the Indian regulatory framework. Slide number 37 showcases the innovative and sustainable efforts of Tata Power, India's leading energy company. They have recognized the potential of utilizing rooftops for installing solar panels and have successfully implemented this initiative in various parts of the world, with India leading the way. By utilizing the empty space on rooftops, Tata Power has been able to generate green electricity, making a significant contribution to the country's renewable energy goals. In 2021, their program had expanded to 90 cities in India, producing an impressive 421 million watts of electricity. This is equivalent to the annual electricity consumption of 40000 homes in the US. This is a remarkable achievement and a testament to the company's commitment to ESG principles. With their efforts, there is a potential for significantly reducing carbon emissions and conserving energy. But it's not just about energy. By utilizing idle spaces on buildings, Tata Power has also reduced the company's ESG risk, creating a win-win situation for both the energy and construction sectors. Looking towards the future, we can expect to see more collaborations between energy and construction companies to effectively use idle spaces in buildings. This form of industrial symbiosis holds tremendous potential for a sustainable and responsible approach to energy production and infrastructure development. In conclusion, Tata Power's initiative, along with other similar ones, will continue to shape the future of Quality Infrastructure and ESG in the Indian regulatory framework..

[Audio] We will now discuss the importance of Environmental, Social, and Governance (ESG) in the Indian regulatory framework. This presentation includes a group exercise where participants will study the ESG/Sustainability/BRSR report of an assigned company and assess their achievements beyond mandatory regulations. The exercise will last 15 minutes and each individual will have 5 minutes to present their assigned company's achievements in the respective sequence of ESG. This is a chance to showcase progress and advancements in environmental, social, and governance practices. The exercise aims to encourage companies to go beyond mandatory regulations and prioritize ESG factors in their operations. We believe this is crucial for sustainable and responsible business practices. Thank you for participating in this exercise and let's now move on to the final part of our presentation, the group exercise session..

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