Sebi has formed a multi-stakeholder working group to reassess the regulatory framework for ESG Rating Providers. The panel includes issuers, investors, rating agencies, legal experts, and academics, tasked with recommending measures to improve transparency, accountability, and global alignment in ESG ratings.
The Securities and Exchange Board of India (Sebi) announced on February 18, 2026, the creation of a dedicated working group to review the regulatory framework governing ESG Rating Providers (ERPs). This initiative comes amid rising concerns from market participants about the consistency and credibility of ESG ratings, which play a crucial role in guiding investment decisions and corporate disclosures.
The working group will undertake a comprehensive review of the current framework and propose reforms to strengthen oversight, improve disclosure standards, and align India’s ESG rating practices with global benchmarks.
Key Highlights
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The panel comprises issuers, investors, domestic and global ESG rating providers, legal experts, analysts, and academia.
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The review is based on extensive feedback from stakeholders regarding gaps in the existing ERP framework.
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Objectives include enhancing transparency, ensuring accountability of rating providers, and boosting investor confidence in ESG-linked instruments.
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The group will also explore harmonization with international ESG rating standards to improve comparability and global acceptance.
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Sebi’s move reflects the regulator’s broader push to integrate sustainability into India’s capital markets and strengthen governance around ESG disclosures.
This development is expected to have far-reaching implications for corporates, investors, and rating agencies, as ESG considerations increasingly shape capital allocation and regulatory priorities worldwide.
Sources: Business Standard, Rediff Moneynews, PTI