A Comparative study of ESG Disclosure among Chemical, Banking and FMCG sectors.

Abstract

Environmental, Social, and Governance (ESG) disclosure has become a crucial aspect of corporate reporting, reflecting an organization's commitment to sustainable and responsible business practices. This study provides a comparative analysis of ESG disclosures among three distinct sectors—Chemical, Non-Banking Financial Companies (NBFCs) & Banking, and Fast-Moving Consumer Goods (FMCG). Each sector faces unique ESG challenges and reporting obligations. Chemical companies are primarily scrutinized for their environmental impact, including emissions, waste management, and resource consumption. NBFCs & Banks, while less environmentally intensive, focus more on governance factors such as ethical lending, risk management, and financial inclusion. FMCG companies, due to their extensive supply chains, emphasize sustainability in sourcing, packaging waste reduction, and labor practices. The study highlights variations in ESG disclosure quality, regulatory compliance, and voluntary sustainability reporting across these sectors. Banking and NBFCs tend to have stronger governance disclosures, driven by stringent financial regulations, whereas Chemical companies often provide more detailed environmental impact reports due to industry-specific sustainability concerns. The FMCG sector, with its consumer-facing nature, has a greater focus on social responsibility, including ethical sourcing and community engagement. Despite increasing regulatory requirements and stakeholder expectations, gaps remain in standardization and the depth of disclosures. This study underscores the need for sector-specific ESG frameworks to enhance transparency and accountability, ultimately aiding investors and policymakers in making informed decisions.