📘 IAS Prelims 2025 — GS-I Q.4 | Classroom Explanation

📌 Question

Q.4) Consider the following statements:

I. The Reserve Bank of India mandates all the listed companies in India to submit a Business Responsibility and Sustainability Report (BRSR).
II. In India, a company submitting a BRSR makes disclosures in the report that are largely non-financial in nature.

Which of the statements given above is/are correct?

(a) I only
(b) II only
(c) Both I and II
(d) Neither I nor II

✅ Correct Answer: (b) II only

🧑‍🏫 Classroom Explanation

This question tests regulatory authority clarity and nature of ESG disclosures, both of which are high-yield prelim themes.

🔍 Statement-wise Analysis

❌ Statement I: Incorrect

• Key elimination clue:
Listed companies are regulated by SEBI, not the RBI.

• Correct authority:
The Business Responsibility and Sustainability Report (BRSR) was introduced by:

• SEBI
• Through amendment to Regulation 34(2)(f) of the SEBI (LODR) Regulations

• RBI’s role:
RBI regulates banks, NBFCs, and monetary policy, not corporate ESG reporting.

➡️ Wrong regulator mentioned
❌ Hence, Statement I is incorrect.

✅ Statement II: Correct

• Nature of BRSR disclosures:
BRSR focuses primarily on non-financial disclosures, such as:

• Environmental impact
• Social responsibility
• Corporate governance practices

• Objective of BRSR:
To ensure:

• Standardised ESG reporting
• Comparability across companies, sectors, and time
• Better-informed investment decisions

➡️ These are largely non-financial parameters
✅ Hence, Statement II is correct.

🧮 Final Evaluation

✔️ Statement I: ❌ Incorrect
✔️ Statement II: ✅ Correct

➡️ Correct answer: (b) II only

🎯 UPSC Elimination Logic (Very Important)

• UPSC frequently traps aspirants by:

• Assigning correct function to wrong regulator
• Mixing RBI–SEBI–Finance Ministry roles

• Rule of thumb:

• RBI → Banks, NBFCs, monetary policy
• SEBI → Listed companies, capital markets, disclosures

🔗 Bridge Points (Future-Proof Inputs)

• Expect future questions on:

• ESG frameworks (BRSR vs Integrated Reporting)
• SEBI vs RBI regulatory boundaries
• Mandatory vs voluntary disclosures
• ESG-linked investing and sustainability indices

• BRSR aligns with:

• Global ESG standards
• Responsible investing trends
• Sustainable finance discourse

📍 GS Mapping

• GS Paper II
• Subject: Governance / Regulatory Framework
• Theme: Corporate Regulation, ESG, Market Oversight
• Question Nature: Static governance with current relevance