BRSR Core value chain disclosures are pushing ESG reporting beyond compliance, raising key challenges around attribution, supplier data, and methodology.
India’s BRSR Core framework has already moved beyond the initial implementation stage and is now entering a phase of scale and broader market coverage. Alongside this expansion, the 30 January 2026 SEBI Master Circular has consolidated all the previous frameworks for ease of the value chain disclosures. ESG disclosures for the value chain are now applicable to the top 250 listed entities on a voluntary basis from FY 2025–26. The scope covers upstream and downstream partners individually accounting for 2% or more of purchases or sales by value, with companies permitted to limit reporting to 75% of purchases and sales, respectively. The direction of the framework is important because a significant share of environmental and social impacts sit outside direct operations and across supply chains.
However, as companies begin operationalizing value chain reporting, clarity on methodology is becoming a starting point for disclosure readiness, with an increasing focus on how these disclosures should be calculated in practice. One of the biggest implementation gaps is attribution methodology.
SEBI requires listed entities to report value chain KPIs “to the extent attributable to their business” with value chain partners. However, the framework does not prescribe how this attribution should be performed in practice. This becomes particularly complicated where suppliers serve multiple customers simultaneously.
Consider a packaging manufacturer supplying products to several FMCG companies. The supplier may disclose total annual emissions at the entity level but may not maintain product- or customer-wise emissions or facility-level carbon accounting. Each listed entity sourcing from that supplier still needs to determine what portion of emissions is attributable to its own procurement activity. Theoretically, companies could allocate emissions using revenue share, procurement volume, production throughput, or product-level allocation. However, each methodology can produce materially different outcomes. Suppose one FMCG company contributes 25% of supplier revenue but purchases highly energy-intensive customized packaging, while another contributes lower revenue but purchases standard low-emission products at higher volumes. In such cases, revenue based allocation may not accurately reflect actual attributable emissions.
| Financial Year | Scope of BRSR Applicability |
|---|---|
| 2023–24 | Top 150 listed entities |
| 2024–25 | Top 250 listed entities |
| 2025–26 | Top 500 listed entities |
| 2026–27 | Top 1000 listed entities |
The technically preferable solution may be product-level or process-level allocation. However, many suppliers, especially MSMEs, do not currently maintain ESG data systems capable of measuring emissions at that level of granularity. This creates a practical reporting dilemma. If suppliers themselves do not measure product-level emissions, listed entities often rely on estimated allocations, spend-based assumptions, industry-average emission factors, previous-year supplier disclosures, or provisional supplier declarations pending validation. The challenge becomes even more significant when reporting timelines are considered. Listed entities operate under fixed annual reporting deadlines, and global partners may finalize sustainability data much later or may not publish ESG disclosures at all.
This means companies may need to complete BRSR disclosures before supplier-level ESG data for the same reporting period has been finalized. Similar implementation challenges also emerge for ratio-based KPIs such as gross wages paid to women as a percentage of total wages or employee well being expenditure ratios. A supplier may disclose that women account for 40% of total wages across the organization, whereas the workforce specifically linked to the listed entity’s procurement activity may have a very different composition. Using entity-wide ratios may therefore not accurately represent the attributable footprint, while obtaining customer specific workforce allocation data may not be operationally feasible. SEBI’s Master Circular partially addresses these issues by requiring companies to clearly disclose the assumptions, estimates, and reporting scopes used in value chain disclosures.
However, as BRSR Core reporting matures, the next phase of implementation may increasingly depend on developing practical methodologies around attribution, consolidation, supplier-level data governance, and reporting consistency. The discussion around value chain ESG reporting is therefore gradually shifting from “whether companies disclose” toward “how disclosures are actually calculated”, a distinction that may become increasingly important as ESG reporting frameworks evolve in India.
The expansion of India’s BRSR Core framework signals that ESG reporting is entering a more operational phase, with increasing attention on the practical aspects of implementation.
As value chain reporting becomes part of the reporting landscape, the focus is gradually shifting from disclosure scope toward the calculation and measurement of reported metrics. This is particularly significant because a substantial portion of environmental and social impacts resides outside direct operations, making supply chains an important area for improving ESG visibility and understanding broader business impacts.
As companies begin implementing value chain reporting, greater emphasis may be placed on building processes that support reliable and consistent data collection. Areas such as attribution approaches, supplier engagement, and the use of assumptions and estimates are likely to become important considerations during implementation. Since supplier ecosystems often differ in scale, maturity, and data availability, establishing transparent reporting practices can help improve comparability and usability of ESG information over time.
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