A recent report from ECube and StepChange has highlighted a significant challenge in sustainability efforts, revealing that the cement, metals, power, and wood and paper industries are responsible for an astonishing 90% of reported Scope 1 (direct) and Scope 2 (indirect) emissions. The findings underscore the urgent need for tailored sustainability strategies within these sectors, which exhibit exceptionally high energy consumption.

The BRSR Barometer 2023 synthesizes insights from over 1,000 Business Responsibility and Sustainability Reports (BRSR) and evaluates more than 50 Environmental, Social, and Governance (ESG) metrics across 13 sectors for the fiscal year 2023. The report also points to a concerning trend of underreporting Scope 3 emissions, with only 223 companies across eight sectors providing relevant data last year. Scope 3 emissions, which often represent over 80% of a company’s total greenhouse gas emissions, highlight the necessity for comprehensive reduction strategies throughout entire value chains.

Moreover, the report reveals low levels of third-party assurance for environmental metrics, particularly in sectors like healthcare and trade, where coverage for Scope 1 and 2 emissions ranges from 0-15%. This gap indicates an opportunity for companies to bolster the credibility of their sustainability disclosures.

The report calls for industry-specific approaches to optimize resource utilization and enhance sustainability efforts. Ankit Jain, Co-Founder and CEO of StepChange, emphasized the need for businesses to integrate sustainability as a core value rather than merely a compliance obligation. He noted that the underreporting of metrics and concentration of emissions in select industries not only highlight existing challenges but also present significant opportunities for transformation.

Shankar Venkateswaran, Co-Founder and Managing Partner at ECube, echoed this sentiment, suggesting that sustainability reporting should not be driven solely by stakeholder demands or regulatory requirements, but should be an integral part of a company’s pursuit of excellence.

The BRSR Barometer aims to be an annual publication that tracks improvements in sustainability disclosures, accompanied by sector-specific webinars to foster knowledge sharing and effective strategy adoption among companies.