Decoding Emissions: A Sectoral Analysis Of India's Corporate Carbon FootprintIn the fiscal year 2022-23 (FY23), emissions from listed companies were predominantly attributed to a select group of sectors, namely power, metals and mining, construction material, chemical, and oil, gas, and consumable fuels, collectively contributing to 90% of the emissions. Data sourced from the annual reports of 1,040 listed companies by EY India revealed that these entities emitted 1.26 billion metric tonnes of carbon dioxide equivalent (MTCO2e) under Scope 1 emissions and 0.14 billion MTCO2e under Scope 2 emissions. Scope 1 includes emissions directly from sources owned by the companies, while Scope 2 encompasses indirect emissions such as the purchase of electricity from external sources. Nitesh Mehrotra, Partner at EY India, emphasised the pivotal role of India in the global path to net zero and acknowledged emerging pockets of excellence in climate action.
The data also revealed that 71% of companies are undertaking projects with the goal of reducing greenhouse gas emissions. It is emphasised that firms have the option to implement diverse initiatives such as investing in renewable energy, providing training for green jobs, improving energy efficiency, and transitioning toward a growth trajectory with low carbon emissions. Several companies, such as Tata Motors, are expanding their electric vehicle range and investing in non-fossil energy sources. Fast-moving consumer goods (FMCG) firms are adopting more sustainable agricultural and climate-smart farming practices due to their dependence on raw materials from the agricultural sector. Corporations like JSW Group have announced their goal of becoming carbon neutral by 2050, while Reliance Industries aims to achieve net zero carbon by 2035. In the previous month, NTPC and Oil India inked a memorandum of understanding, indicating their collaboration in sectors such as renewable energy and green hydrogen.
In terms of resource usage, companies withdrew a total of 14.4 trillion litres of water, with the power sector accounting for 78.6%, followed by metals and mining (5.3%), and oil, gas, and consumable fuels (4.2%). The top five sectors in waste generation were power, metals and mining, capital goods, FMCG, and chemical, collectively contributing to 95.1% of the waste. Around 275 million metric tons of waste underwent reuse, recycling, or recovery processes.
Regarding energy consumption, companies sourced 28% of their energy from renewable sources. Healthcare, FMCG, and utilities consumed over 70% of their energy from renewables, while metals and mining, chemical, telecommunications, and power lagged behind, with less than 1% of their energy consumption coming from renewables. Eleven of the 22 sectors had less than 10% utilization of renewables to meet their energy needs. In addition to Environmental, Social, and Governance (ESG) frameworks, the Securities and Exchange Board of India was recommended to introduce evaluation frameworks to measure the impact of climate policies implemented by Indian companies.