Race Eco Chain Ltd Management Discussions

BRIDGING THE SUSTAINABILITY GAP: ORGANISING THE UNORGANISED

• India is marching fast towards ESG compliance. SEBI focus on sustainable business practices has intensified over the years. With BRSR* reporting being mandatory for top 100 listed companies in 2012 (by market cap), currently it has expanded to top 1,000 companies.

• SEBI has been proactive in its response to the growing needs of investors focus on ESG disclosures made by listed entities. Owing to this, recently SEBI has introduced BRSR core framework. According to this framework, the listed entities should obtain mandatory reasonable assurance on the BRSR Core and disclosures by an independent assurance provider. The mandate is applicable to top 150 listed companies (by market capitalization) for FY24 and will expand to top 1,000 listed companies by FY27. ^•

• Further, the framework also provides that a listed entity should report the parameters as per BRSR Core for their value chain to the extent it is attributable to their business with that value chain partner. The ESG disclosures for the value chain is applicable to the top 250 listed entities (by market capitalization), on a comply-or-explain basis from FY 2024-25. The limited assurance of the value chains ESG disclosures shall be applicable on a comply-or-explain basis from FY 2025-26.

• In conclusi?n, SEBIs introduction of the BRSR framework for core ESG disclosures and assurance is a commendable step. This initiative not only enhances transparency and quality of ESG reporting by listed entities but also extends the scope to their value chain partners. By mandating comprehensive disclosures across the value chain, SEBI demonstrates its proactive approach in addressing investors growing needs for comprehensive ESG information, thereby promoting sustainable and responsible business practices.

• We at RACE, have always aimed to remain at the forefront to ensure our business and value chains sustainability. With SEBIs increasing focus towards value chain sustainability coupled with governments implementation of mandatory plastic recycling targets for PIBOs (Producer, Importer, and Brand Owner), eligible entities are not only obligated to meet their mandatory Extended Producer Responsibility (EPR) targets but also ensure the sustainability of their value chain in the future, posing a significant challenge due to the prevalence of unorganized players.

• Given these favorable regulations, Our strong ESG-focused mindset, positions us strategically to bridge the existing gap in the waste management sector.