Module: | SEBI LODR & Corporate Governance Frameworks
Q7: Consider the following statements regarding ESG disclosures for the Value Chain under the expanded SEBI guidelines for 2025-2026:
1. Listed entities must disclose ESG metrics for value chain partners that cumulatively account for 75 percent of their purchases or sales by value.
2. Value chain reporting requires the company to look beyond its own direct operations to track greenhouse gas emissions and labor practices of its major suppliers.
3. Assurance of value chain disclosures is implemented immediately on a mandatory basis alongside BRSR Core assurance for all listed companies.
Which of the above statements is/are correct?
2. Value chain reporting requires the company to look beyond its own direct operations to track greenhouse gas emissions and labor practices of its major suppliers.
3. Assurance of value chain disclosures is implemented immediately on a mandatory basis alongside BRSR Core assurance for all listed companies.
Which of the above statements is/are correct?
✅ Correct Answer: A
🎯 Quick Answer:
A. Only 1 and 2 are correct.Structural Breakdown: Statement 1 is correct; the threshold for tracking value chain partners is 75%. Statement 2 is correct; tracking scope 3 emissions is a core component.
Statement 3 is incorrect; assurance of value chain disclosures is being phased in on a "comply or explain" basis first.
Historical/Related Context: Global frameworks like the GHG Protocol emphasize Scope 3 emissions.
SEBI introduced this to prevent companies from outsourcing ESG liabilities.
Causal Reasoning: Value chain reporting forces holistic corporate accountability beyond the company's legal boundaries.