CEA Urges Tailored ESG Approach for India, Warns Against Blind Adoption of Global Standards

ENA Global 2024-09-05 15:17:30 New Delhi, Sep 5 (KNN) India's Chief Economic Advisor (CEA) has called for a measured approach to implementing Environment, Social, and Governance (ESG) practices, emphasising the need for contextual adaptation rather than wholesale adoption of international standards. Speaking at a conference organised by the Indian Institute of Corporate Affairs (IICA), the CEA highlighted the importance of ESG for India's development while cautioning against uncritical acceptance of external mandates. He pointed out the apparent inconsistency in global leadership, noting, When global leaders travel in private jets to attend climate change conferences, it undermines the credibility of their message. The CEA stressed that responsible business practices in India should be tailored to the national context, diverging from Western interpretations. He advocated for a focus on climate adaptation rather than emission mitigation, given India's relatively lower contribution to global emissions. Addressing the imposition of international standards on developing countries, the CEA reminded that developed nations established these norms only after achieving certain economic thresholds. He warned against prematurely burdening Micro, Small, and Medium Enterprises (MSMEs) with ESG costs, stating it could hamper their competitiveness and growth. On corporate social responsibility, the CEA emphasised its integral role in business operations rather than as a separate activity. He cautioned that short-term profit-seeking at the expense of younger generations' productivity could lead to reduced aggregate demand and economic growth in the long term. The government's stance on ESG regulation was clarified by Inderdeep Singh Dhariwal, Joint Secretary, Ministry of Corporate Affairs. He stated that the government aims to provide guiding principles rather than strict regulations, fostering a trust-based relationship with companies. Dhariwal indicated openness to sector-specific guidelines but noted that such demands should originate from the industries themselves. This balanced approach reflects India's efforts to integrate ESG practices while maintaining economic competitiveness and addressing unique national priorities. (KNN Bureau) 39170 https://knnindia.co.in/news/newsdetails/global/cea-urges-tailored-esg-approach-for-india-warns-against-blind-adoption-of-global-standards 2024-09-05 15:17:30 knnindia.co.in CEA Urges Tailored ESG Approach for India, Warns Against Blind Adoption of Global Standards