A Simple Guide to ESG Compliance for Indian MSMEs

Introduction

ESG stands for Environmental, Social, and Governance. It is a way for businesses to show that they care about sustainability, fair business practices, and ethical management. Many Micro, Small, and Medium Enterprises (MSMEs) in India are now expected to follow ESG guidelines. But what does ESG mean for small businesses, and why is it important? Let’s break it down.

Why Should MSMEs Care About ESG?

ESG is not just for big companies. Even small businesses can benefit from ESG by:

1. Attracting more customers and business partners
2. Saving money by using resources efficiently
3. Getting access to funding and loans for sustainable businesses
4. Avoiding penalties by following environmental and social laws
5. Building a long-term, successful business

Some important ESG-related rules in India include:

• Companies Act, 2013 – Requires larger companies to spend on Corporate Social Responsibility (CSR), affecting MSMEs in their supply chain.
• BRSR (Business Responsibility & Sustainability Reporting) – A reporting system that large companies use, which may also apply to MSMEs.
• Energy Conservation Act, 2001 – Encourages companies to reduce energy use.
• Pollution Control Board Regulations – Requires businesses to follow environmental guidelines.
• SEBI Guidelines on ESG Disclosures – Rules for listed companies, which can impact their MSME partners.
• Extended Producer Responsibility (EPR) Rules – MSMEs involved in packaging or manufacturing certain goods must ensure proper waste management.
• Occupational Health and Safety Regulations – Requires businesses to provide safe working conditions for employees.
• Waste Management Rules – Includes e-waste, plastic waste, and hazardous waste disposal regulations that MSMEs must follow.

How Can MSMEs Begin Their ESG Journey?

ESG compliance may seem complex, but MSMEs can start with simple steps:

How Enexion Consulting Pvt. Ltd. Can Help

We know ESG can seem complicated, but we make it simple for MSMEs. Enexion Consulting Pvt. Ltd. provides:

🔹Affordable ESG audits to check where your business stands.
🔹Easy-to-follow ESG action plans tailored for MSMEs.
🔹Help with ESG reporting & certifications to improve credibility.
🔹Sector-specific ESG solutions for industries like manufacturing, textiles, and Automotive.
🔹GHG Accounting: Accurate greenhouse gas emissions tracking to help reduce your carbon footprint and meet sustainability goals.

📢 Want to make your MSME ESG-ready? Contact Enexion Consulting Pvt. Ltd. today!