Overview

Climate progress is at a critical juncture in India’s efforts to move toward its goal of reducing emissions to net zero by 2070. The government of India continues to take steps introducing new climate policy measures, including a new national carbon market, and corporate advocacy from companies and industry associations across the economy will play a key role in ensuring the effectiveness of these policy actions.

An initial analysis of 20 of India's most significant companies revealed ReNew to be the only clear corporate climate policy leader. However, preliminary findings also indicated a lack of concentrated opposition to greater climate progress, as identified in elsewhere globally. 18 companies were assessed as being partially supportive of science-aligned pathways to limit global warming to 1.5°C, according to the recommendations of the Intergovernmental Panel on Climate Change (IPCC), in their climate policy engagement. One company, Coal India Ltd. demonstrated climate policy engagement that is clearly misaligned with this goal, however its engagement with climate policy is limited.

As part of its assessment of the corporate climate policy engagement landscape in India, InfluenceMap’s initial analysis identified 20 climate significant companies and assessed these companies on their direct and indirect climate policy engagement activities. The companies selected include the largest emitter companies headquartered in India under the Climate Action 100+ initiative, alongside climate significant companies from the Forbes 2000 and S&P 100 company rankings. The number of companies assessed under the platform will soon increase to provide a more comprehensive overview of industry actors in India.

The majority of Indian companies and industry associations show low levels of engagement with climate policy. Of the 20 India-based companies assessed by InfluenceMap, only three have an “Engagement Intensity” above the 25% threshold that would indicate a strategic level of advocacy (regardless of positioning). One each from the automotive sector, energy sector and steel sector respectively. (See the graph on the companies tab of the platform for a comparative visual on how Indian companies perform). Increased positive engagement from companies that offer nominal support for climate ambition, or that have internal climate commitments in need of a supportive policy landscape, is critical to tip the scales in favor of science-aligned climate policy.

InfluenceMap’s analysis of climate policy engagement by eight of India’s most influential industry associations found that none demonstrate climate policy engagement that supports science-aligned pathways for delivering the 1.5°C warming goal of the Paris Agreement. Seven of the eight industry associations on the platform demonstrated partially aligned climate policy engagement, with the Confederation of Indian Industry (CII) obtaining one of the highest scores (Org Score: 72%, PB: B-) while being the most engaged (EI: 22). (See the graph on the industry associations tab of the platform for a comparative visual on how these groups perform).

Meanwhile, Society of Indian Automobile Manufacturers (SIAM) (Org Score: 59%, PB: C-) obtained the lowest score of the industry associations assessed on climate policy engagement in India. Although it has supported recent EV policies, this is driven by its historical opposition to fuel standards and advocacy for internal combustion engine vehicles. Some members of the SIAM, for example – such as Mahindra & Mahindra – score higher than the group for their climate policy engagement. Misalignment of this kind is a key concern for investors.

Global Comparisons: Indian companies appear to be less misaligned in their climate policy engagement than their counterparts globally. Almost all the entities assessed are partially aligned. This potentially demonstrates a lack of opposition to climate policy ambition from India’s corporate sector, as more clearly indicated in other regions with significant fossil fuel industries such as Australia and the United States. This might ultimately open up a pathway for Indian companies to work with the government to become a global leader on climate action.

A nuanced grasp of how State-Owned Enterprises (SOEs) contribute to the dynamics of climate policy is required to better understand the Indian climate policy engagement landscape. The Indian market is characterized by the presence of large SOEs. As significant industry stakeholders, it is anticipated that SOEs will play a pivotal role in spearheading the technological and institutional innovations essential for steering the low-carbon transition. They also contribute their industry knowledge and technical expertise in formulating domestic climate policy – for example, by providing studies and data on sectoral carbon emissions and standards. SOEs are, therefore, in a unique position to inform the government about risks and innovation potential related to climate change, and to drive forward effective policy responses. This has informed InfluenceMap's commitment to monitor Indian SOEs' climate policy involvement, in addition to the private sector.

Limited transparency in corporate engagement with the regulatory processes in India could also be contributing to the identification of fewer misaligned organizations across the Indian climate policy engagement landscape. This might be giving opponents of climate policy an unfair advantage, as they may be able to influence Indian government policy without public or investor scrutiny over whether this influence aligns with India’s high-level climate ambitions. As such, a lack of transparency on climate policy engagement represents a potential barrier to climate policy leadership in the region.

Top-line Statements on Climate Outweigh Detailed Policy Engagement

Indian companies and industry associations show greater support and engagement on top-level climate statements, such as climate science and high-level commitments, such as India’s 2070 net zero target, instead of specific climate-related regulations, a similar trend to other regions assessed by InfluenceMap. For example, almost 85% of engagement on India’s 2070 net zero target was supportive.

Of the 20 companies assessed, 90% acknowledged and supported the science of climate change in their reports and other corporate communications. This is likely attributable to rising instances of climate-change induced natural disasters in India and elsewhere. For example, Infosys, highlighted the link between the global temperature rise and droughts, heat waves, forest fires etc. Of the limited engagement on specific climate-related regulations, entities appear to show greater engagement with renewable energy and circular economy policies, compared with less engagement on other forms of climate policy, such as carbon pricing policies and GHG emissions regulation.

• For example, nine companies have expressed explicit support for the 500GW renewable energy goal by 2030 goal, one among the five goals of the Panchamrit NDC objectives. India has subsequently enacted several policies like the Production Linked Scheme-Solar (PLI) and the PM Surya Ghar Muft Bijli Yojana, which have enabled the uptake of solar energy from the production and consumption side. In general, companies tend to engage positively with these policies.
• Meanwhile, nine companies actively engaged with circular economy policies, including plastic waste management and vehicle scrappage policies. With India reported to be the highest plastics polluter globally, the analysis shows the corporate sector is pushing the government to introduce policies to tackle plastic pollution in the country.
• India’s domestic carbon market, the carbon credit and trading system (CCTS) is still under development and is estimated to become operational by 2026 alongside the EU CBAM. Only five companies appeared to engage with the CCTS. Most notably, ReNew advocated for synergizing the CCTS with other similar carbon adjustment mechanisms to avoid “trade tensions”. However, most companies, limit their statements to internal carbon pricing mechanisms undertaken within their operations.

BRSR Provides Opportunity to Disclose Corporate Climate Policy Engagement

In 2023, India updated its Business Responsibility and Sustainability Reporting (BRSR) guidelines, making it mandatory for the country’s top 1,000 listed companies to respond to 98 essential indicators (mandatory) and 42 leadership indicators (voluntary). Under ‘Principle 7: Businesses, when engaging in influencing public and regulatory policy, should do so in a manner that is responsible and transparent’ companies are mandated to disclose the number of its trade and industry association affiliations (1.a) and list the top 10 affiliations based on total members of the bodies (1.b). Following this, companies have the option to disclose ‘Details of public policy positions advocated by the entity’, included the name of the policy, method of advocacy, whether the position is public, frequency of review of position and a link to the position.

The updated BRSR guidelines provides an excellent opportunity for companies to transparently disclose climate policy engagement activities, however the analysis finds only six companies responded to voluntary questions on advocacy in the BRSR to disclose direct climate policy engagement activities, despite responding to other mandatory questions on industry association memberships. Furthermore, despite companies submitting disclosures according to India’s BRSR guidelines, most of these are not assessed as complete disclosures under InfluenceMap’s assessment, which uses the Global Standard on Responsible Climate Lobbying as its benchmark on this issue.

The Global Standard on Responsible Corporate Climate Lobbying is an investor-led framework that guides companies to align their policy engagement activities with the Paris Agreement. It provides indicators for committing to, establishing governance, and acting and reporting on misalignments between policy engagement activities and climate goals. InfluenceMap has developed a dedicated methodology to assess company disclosures and governance processes related to climate policy engagement alignment. These evaluations are separate but complementary to LobbyMap’s analysis of real-world policy engagement activities and are benchmarked against the Global Standard.

Table 1 displays the differences between the requirements of the Global Standard on Responsible Corporate Lobbying and India’s BRSR guidelines¹. Similarly to other regional disclosure frameworks, there remain gaps between disclosure rules by regulators and investor expectations. For BRSR, this includes no requirement for companies to disclose a commitment to align advocacy with 1.5°C (direct climate policy engagement), no framework for assessing and addressing misalignments of company’s own position or that of its industry associations with 1.5°C.