Two Sides Of The Same Coin: Unifying CSR And ESG For A Sustainable Human Future
Yukti Arya, National University of Study and Research in Law (NUSRL)
ABSTRACT
In an era of escalating climate crisis and heightened stakeholder expectations, Corporate Social Responsibility (CSR) and Environmental, Social, and Governance (ESG) have emerged as two sides of the same coin, both aiming to align corporate operations with sustainable development. This research paper critically examines the evolving landscape of corporate climate accountability in India, with particular focus on the legal and regulatory gaps in ESG reporting and carbon risk disclosure frameworks.
India’s ambitious climate commitments, including net-zero emissions by 2070 and updated Nationally Determined Contributions announced at COP26, have placed significant responsibility on corporations. The introduction of SEBI’s Business Responsibility and Sustainability Reporting (BRSR) framework in 2021, followed by BRSR Core, marked a major shift towards mandatory ESG disclosures for the top 1,000 listed companies. However, the paper identifies persistent structural weaknesses, including voluntary Scope 3 emissions reporting, lack of mandatory climate scenario analysis, inadequate assurance mechanisms, weak enforcement, and regulatory fragmentation between SEBI, the Companies Act, 2013, and environmental laws. These gaps facilitate greenwashing, undermine investor confidence, and hinder genuine climate action.
Through doctrinal analysis, the study traces the evolution of CSR under Section 135 and ESG under SEBI regulations, evaluates key judicial contributions (particularly the expansion of Article 21 and principles such as Polluter Pays), and conducts a comparative assessment with global standards such as the EU’s CSRD, UK’s TCFD-aligned disclosures, and US SEC proposals. The research highlights how the current framework promotes symbolic compliance rather than substantive accountability.
The paper concludes that unifying CSR and ESG into a coherent, enforceable framework is essential for achieving India’s sustainable development goals. It proposes targeted reforms including mandatory Scope 3 disclosures, robust assurance standards, stronger penalties, integration of sustainability with financial reporting, and enhanced directors’ fiduciary duties under Section 166 of the Companies Act.
Keywords: ESG Reporting, Corporate Social Responsibility, Carbon Risk Disclosure, BRSR Framework, Greenwashing, Corporate Climate Accountability, Sustainable Development.
