BRSR Reporting: How Can EcoTrace Facilitate Carbon Emission Reporting?

The journey started in 1992 when governments worldwide finally convened to acknowledge the ‘elephant in the room’ – desertification, loss of biodiversity, and, most evident of all, climatic change.

The human impact was already beyond repair when the Rio Summit of 1992 was organized. Global powers sprung to remedial action, and two bodies were opened for signature – the United Nations Framework Convention on Climate Change (UNFCC) and the Convention on Biological Diversity (CBD).

But how do you include the Business Community – the recognizable contributors to global pollution in this conversation? Enter the ‘World Business Council for Sustainable Development’ (WBCSD), which was also formed during the Rio Conventions. 

WBCSD ensured participation from the Business Community through a system of public reporting. These reports pivoted around Economic, Social, and Environmental responsibilities. 

Ring a bell??

BRSR and Its History in India

In India, this public reporting landscape goes back to 2009 when the Ministry of Corporate Affairs (MCA) issued the Voluntary Guidelines for Corporate Social Responsibility (CSR).

After multiple initiatives, it was finally in 2012 that SEBI introduced a non-financial reporting format called the Business Responsibility Reporting (BRR). It mandated the top 100 companies in India, as per market capitalization, to disclose their Environmental, Social, and Governance responsibilities (ESG).

However, with India’s increasing logistics capacity and, thus, environmental impact, a stronger initiative was required. 

Did you know that we transport approximately 4.6 billion tons of freight annually, generating a transport demand of 2.2 trillion ton-kilometers (ton-km) at the cost of ₹9.5 lakh crore and emitting a total of 2.3 Gt of carbon dioxide?

This demand is expected to grow further, with associated road freight movement projections at 9.6 trillion ton-km by 2050.

On 25th March 2021, SEBI replaced BRR with BRSR (full form -Business Responsibility and Sustainability Reporting), which eventually mandated the top 1000 listed companies (as per market capitalization) to disclose their impact on the environment, society, and governance on a compulsory basis for FY 2022-23.

Are you wondering what the BRSR reporting format mandates? Read on to find out…

Components of BRSR Reporting

BRSR reporting format consists of various components, each designed to capture different aspects of a company's sustainability efforts. These include:

1. Environmental Performance

   This aspect evaluates the company's impact on the environment, covering areas like GHG emissions, water usage, and waste generation. Companies disclose their environmental footprint, reduction targets, and progress, aiming to reduce their ecological impact and lower operational costs.
   
   

2. Social Responsibility

   This component focuses on the company's social responsibilities, including initiatives related to employee welfare, community development, and diversity and inclusion. Companies disclose workforce demographics, community investments, and ethical sourcing policies. Strong social responsibility improves employee morale, community relationships, and talent attraction.
   
   

3. Governance Practices

   This section examines the company's corporate governance structure, ethical business practices, and adherence to regulatory standards. Companies disclose board structure, anti-corruption policies, and whistleblower mechanisms. Good governance practices ensure ethical decision-making, attract investors, and build trust.
   
   

4. Stakeholder Engagement

   This section highlights how the company interacts with and responds to the needs of its various stakeholders, including employees, investors, communities, NGOs, and government agencies. Companies disclose stakeholder engagement strategies and actions taken to address concerns. Proactive engagement fosters trust, transparency, and collaboration.
   
   

5. Supply Chain Sustainability

   This section evaluates the sustainability practices integrated into the company's supply chain, covering responsible sourcing, environmental and social practices of suppliers, traceability, and initiatives to reduce environmental and social impact. Companies disclose supplier selection criteria and initiatives for sustainability. A sustainable supply chain minimizes risks, enhances brand reputation, and ensures responsible sourcing and product quality.

Now that you are familiar with the components of the BRSR Reporting process, let’s delve into the 9 BRSR principles that companies need to comply with.

What are the 9 BRSR Reporting Principles?

The framework of BRSR reporting in India comprises nine principles that guide businesses in their sustainability reporting. These principles serve as a roadmap for companies aiming to integrate responsible and sustainable practices into their operations. The 9 principles of BRSR are:

1. BRSR Principle 1: Businesses should conduct and govern themselves with Ethics, Transparency, and Accountability.

   
   

   Focus: This principle emphasizes ethical decision-making, open communication, and taking responsibility for actions and impacts.

   
   Action points: Establish strong corporate governance structures, implement anti-corruption policies, disclose financial information transparently, and engage in responsible lobbying activities.

   
   Benefits: Fosters trust with stakeholders, attracts responsible investors, and minimizes the risk of ethical scandals.
   
   

2. BRSR Principle 2: Businesses should provide goods and services that are safe and contribute to sustainability throughout their life cycle.

   
   Focus: This principle encourages minimizing environmental impact and ensuring product safety throughout its life cycle, from material sourcing to end-of-life disposal.

   
   Action points: Adopt resource-efficient production processes, invest in renewable energy sources, reduce waste generation, prioritize sustainable packaging, and ensure product safety through rigorous testing and quality control.

   
   Benefits: Reduces environmental footprint, minimizes operational costs, and protects both consumers and the environment.
   
   

3. BRSR Principle 3: Businesses should promote the well-being of all employees.

   
   Focus: This principle promotes fair and responsible treatment of all employees, ensuring their physical and mental well-being, safety, and professional development.
   
   Action points: Offer fair wages and benefits, cultivate a safe and inclusive work environment, provide opportunities for training and career advancement, and respect employee rights to freedom of association and collective bargaining.

   
   Benefits: Boosts employee morale and productivity, reduces turnover, and attracts and retains top talent.
   
   

4. BRSR Principle 4: Businesses should respect the interests of and be responsive toward all stakeholders, especially those who are disadvantaged, vulnerable, and marginalized.

   
   Focus: This principle emphasizes identifying and meaningfully engaging with all stakeholders, particularly those facing vulnerabilities or marginalization, and addressing their concerns.

   
   Action points: Establish open communication channels with stakeholders, conduct regular stakeholder consultations, involve stakeholders in decision-making processes, and address their concerns with proactive and inclusive solutions.

   
   Benefits: Builds trust and collaboration with stakeholders, minimizes social conflicts, and strengthens social license to operate.
   
   

5. BRSR Principle 5: Businesses should respect and promote human rights.

   
   Focus: This principle upholds the commitment to respecting and protecting human rights throughout all business operations and supply chains.

   
   Action points: Conduct human rights due diligence, adopt anti-discrimination policies, ensure fair labor practices across the supply chain, and address any potential human rights violations proactively.

   
   Benefits: Promotes ethical and responsible business practices, minimizes liability risks, and contributes to a fairer and more sustainable global community.
   
   

6. BRSR Principle 6: Businesses should respect, protect, and make efforts to restore the environment.

   
   Focus: This principle emphasizes minimizing environmental impact, protecting natural resources, and making efforts to restore environmental damage.

   
   Action points: Reduce carbon footprint and greenhouse gas emissions, conserve water and other resources, minimize pollution, protect biodiversity, and support initiatives for environmental restoration.

   
   Benefits: Contributes to environmental sustainability, minimizes environmental risks, and enhances brand reputation.
   
   

7. BRSR Principle 7: Businesses, when engaged in influencing public and regulatory policy, should do so in a responsible manner.

   
   Focus: This principle encourages responsible engagement with public policy and regulatory processes, advocating for solutions that benefit both business and society.

   
   Action points: Participate in policy discussions transparently, avoid lobbying activities that undermine the public interest, prioritize sustainable solutions, and respect democratic processes.

   
   Benefits: Maintains positive relationships with policymakers and regulators, contributes to sustainable policy development, and avoids reputational damage.
   
   

8. BRSR Principle 8: Businesses should support inclusive growth and equitable development.

   
   Focus: This principle encourages businesses to contribute to the social and economic development of the communities they operate in, promoting equitable distribution of benefits and opportunities.

   
   Action points: Invest in local communities, create jobs, support infrastructure development, promote access to education and healthcare, and engage in partnerships for inclusive development.

   
   Benefits: Fosters social well-being, minimizes social inequalities, and strengthens business resilience through strong community relationships.
   
   

9. BRSR Principle 9: Businesses should engage with and provide value to their customers and consumers in a responsible manner.

   
   Focus: This principle promotes honest and responsible marketing practices, building trust and providing value to customers through transparent communication and ethical product offerings.

   
   Action points: Avoid misleading advertising, provide accurate and relevant product information, address customer concerns promptly and effectively, and prioritize customer safety and satisfaction.

   
   Benefits: Boosts customer loyalty, minimizes consumer complaints, and enhances brand reputation as a trustworthy and responsible business.
   
   

While the above reporting structure ensures transparency between companies, their investors, and end consumers, businesses are still grappling with the complexities of tracking and calculating scope 3 emissions in particular.

So, how do you do it?

EcoTrace: Facilitating Carbon Emission Reporting

A major setback in the ESG accounting system is the lack of visibility on actual data, especially when talking about scope 3 emissions. Moreover, with bigger conglomerates having multiple partners and vendors, they often rely on these partners to maintain transparency in the data collection process.

The calculation itself is a highly complex process, and even the slightest of errors in data collection could lead to major deviations in the calculation.

This is due to the complexity of variables involved, for example, the number of vehicles deployed in your fleet, their model and make, their mileage, fuel consumption, carbon emissions, etc. 

So, how do we go about it? Intugine’s EcoTrace could help…

Key Features of EcoTrace

1. Carbon Emission Calculation Algorithm 

   EcoTrace’s proprietary algorithm encompasses various variables, such as truck type, manufacturer/model, capacity, load carried, mileage, etc., to calculate scope 3 emissions for each trip accurately.
   
   

2. Data Integration 

   EcoTrace is integrated with Intugine's extensive database, which comprises mileage data for more than 1 million trucks and major lanes in India. This helps you identify transporters with the highest emissions and those with the most green practices.
   
   

3. Emissions Visibility Metrics

   Intugine’s EcoTrace incorporates a wide spectrum of emissions visibility metrics like:

   • Time series of total carbon emissions over a stipulated time period

   • Emissions per trip data

   • Lane and state-wise emissions data

   • Ton-kilometers of goods shipped

   • Carbon Data Index (expressed in grams of CO2 equivalent per 100g of product).

   • Emissions per vehicle manufacturer/model

   
   

4. GHG Reporting Automation

   • Leverage seamless integration that helps automate reporting processes

   • Generate detailed reports that can be exported as PDFs

   • Allow customization, branding, and previewing options for report presentation
     
     

5. Compliances & Accreditations

   Intugine’s EcoTrace complies with global standards and has accreditations from the following:

   • Smart Freight Centre to provide accounting proof calculations of greenhouse gas emissions

   • Compliance with ISO 14083, ISO 14064, and EN16258 standards

   • United Nations Framework Convention on Climate Change (UNFCCC) accreditation 

   • Compliance with science-based targets and Green House Gas Protocol
     
     

At a Glance

Calculating and reporting Scope 3 emissions as part of the latest BRSR reporting guidelines can be tricky! Gathering data on numerous commercial vehicles, understanding their make and model, tracking the exact distance traveled by those vehicles for shipping your assets, etc., and determining their respective GHG emissions can be difficult, especially if you use market fleet vehicles.

While the government of India has made it mandatory only for the top 1000 companies to adhere to the BRSR guidelines, that day isn’t far when this mandate will encompass every organization in the country.

There are certain carbon visibility solutions like EcoTrace that can help you track Scope 3 emissions and automate their reporting process. Going beyond reporting, it is also necessary that companies make conscious decisions to reduce their carbon footprint, and knowing which transporters are their allies in this venture is a great add-on for future-proofing businesses.