National Guidelines
on responsible
Business conduct

MINISTRY OF CORPORATE AFFAIRS
Government of India

National Guidelineson
Responsible Business Conduct

Technical support provided by1

Table of Contents
Message: Hon’ble Prime Minister, Government of India

5

Foreword: Union Minister of Finance and Corporate Affairs

6

Description and Explanation of Terms

7

Chapter 1: Introduction

11

Chapter 2: Core Elements

14

ANNEXURES

29

Annexure 1: Guidance on Adoption of NGRBC

30

Annexure 2: Guidance for Micro, Small and Medium Enterprises

35

Annexure 3: Business Responsibility Reporting Framework

38

Annexure 4: SDGs Mapped Against NGRBC Principles

50

Annexure 5: Business Case Matrix

52

Annexure 6: Guidance for Businesses on Using the BRRF as a SelfAssessment Tool

53

Annexure 7: Indian Laws Principles (Indicative)

55

Annexure 8: Resources

59

National Guidelines on Responsible Business Conduct3

Prime Minister of India

MESSAGE
Our motto, Sabka Saath Sabka Vikas has been the cornerstone for pursuing welfare for all
by ensuring that the benefits of good governance reach everyone. Business has primarily
been seen as wealth creators for their shareholders, but it has the potential to go beyond
that and induce inclusive socio-economic transformation. The Gandhian philosophy oftrusteeship captures the business responsibility towards society.
The philosophy of giving back to the society has been an integral part of the culture,
which has also been imbibed in traditional Indian businesses since time immemorial. In
order to integrate this into the core business philosophy, the Government has obligatedcompanies to take responsibility for the society by incorporating it as part of the fiduciary
duties of a director. Besides, this universal obligation across all classes of companies,
those meeting certain threshold in terms of turnover, networth or net profit are obligatedto set apart two per cent of their net profit for corporate social responsibility activities.
Responsible Business Conduct is a globally recognized concept founded on the idea thatbusinesses can perform better when engaged in re-vitalizing the society from which
they extract resources for production. The National Guidelines on Responsible BusinessConduct, 2018 (NGRBC), which is an improvement over the existing National Voluntary
Guidelines on Social, Environmental & Economic Responsibilities of Business, 2011
(NVGs), are a means of nudging businesses to contribute towards wider development
goals while seeking to maximize their profits. The NGRBC is dovetailed with the United
Nations Guiding Principles on Business & Human Rights (UNGPs). The NGRBC intends to
not just make companies more responsible and accountable but also to create a wholeecosystem to ‘Protect1, ‘Respect1 & ‘Remedy’ as envisaged in the UNGPs.
I sincerely hope that the NGRBC would usher a new philosophy of responsible andsustainable business.

(Narendra Modi)
New Delhi
December 10, 2018

National Guidelines on Responsible Business Conduct

5

FINANCE AND CORPORATE AFFAIRS MINISTERNEW DELHI, INDIA-110001

Foreword
Hon’ble Union Minister of Finance and Corporate Affairs
The constitutional vision of our country promotes inclusive growth and sustainable
development. The challenge is to attain these goals by cautiously balancing
developmental needs with welfare goals. We have constantly strived to take all
possible initiatives to lead India to assume a leadership role in the comity ofnations. However, in the collective journey to achieve global salience, involvementof businesses is crucial. The National Guidelines for Responsible Business Conduct,2018 (NGRBC) brought out by Ministry of Corporate Affairs are part of government’s
pursuit to equitably deliver benefits of growth by engaging ‘India Inc.’ in the country’s
developmental agenda.
The NGRBC urge businesses to conduct business responsibly and sustainably andalso encourage and support their suppliers, vendors, distributors, partners and otherstakeholders to follow the same principle. The guidelines, articulated as a set of nine
principles and their attendant core elements enunciate the thrust of the United
Nation Guiding Principles (UNGPs) on Business and Human Rights and Sustainable
Development Goals and yet remain true and specific to the Indian context.
I am sure that in pursuance of these guidelines, Indian businesses shall not only
gain global prominence but also garner goodwill and growth for their business andcontribute beneficially to society.

(Arun Jaitley)

6

National Guidelines on Responsible Business Conduct

Description andExplanation of Terms
Some of the key terms used in this document aredescribed here. These descriptions are only indicative.
They have been selected based on a review of Indianand international definitions, and their applicability
in the context of these Guidelines.
Accountable: Being responsible and answerable for
their actions, willing to explain them to others, andtaking ownership of all repercussions if so required.
Circular Economy: This is an alternative to a
traditional linear economy (make, use, dispose), in
which resources are used for as long as possible, themaximum value is extracted from them whilst in use,after which products and materials are recovered
and regenerated at the end of each service life. The
idea of a circular economy is called circularity. It isalso referred to as “cradle-to-cradle”.
Collective Bargaining: Negotiating between
the employees’ organization and employer’s
oorganization; management in good faith witha view to agree on terms and conditions of work
and / or settlement of disputes and grievances of
employees represented by a representative body of
employees
Complicity: Refers to involvement of the business inviolations of any of the Principles and Core Elements
by third parties connected with its operations. It is
generally made up of the following:•

An action or omission (failure to act) by a business,or individual representing a business, that ‘helps’(facilitates, legitimize, assists, encourages, etc.)
another, in some way, to perpetrate a violation;•

The business was or should have been awarethat its action or omission could provide such
help;

•

Complicity may be direct, beneficial or silent.

Consumer: A person or business that buys
products or services for personal use, resale or use
in production and manufacture. It also includes theuser of the product or service other than the buyer.
Corporate Social Responsibility (CSR): Corporate
Social Responsibility (CSR) means and includes but
is not limited to (i) Projects or programs relating
to activities specified in Schedule VII of the IndianCompanies Act 2013; or (ii) Projects or programs
relating to activities undertaken by the board of
directors of a company (Board) in pursuance ofrecommendations of the CSR Committee of theBoard as per declared CSR Policy of the company,
subject to the condition that such policy will coversubjects enumerated in Schedule VII of the Act.
Disclosure: An organization’s practice of reporting
to all stakeholders on its economic, environmental
and social impacts. It also presents the organization’svalues and governance model and demonstrates
the link between its strategy and its commitment tosustainable development.
Discrimination: Unjust or prejudicial treatment ofpeople, especially on the grounds of, but not limited
to, caste, creed, sex, race, ethnicity, age, colour,
religion, disability, socio-economic status or sexual
orientation.
Diversity: An understanding that every individualis unique and therefore embracing and respecting
the differences on account of, but not limited
to, caste, creed, sex, race, ethnicity, age, colour,
religion, disability, socio-economic status or sexual
orientation.
Employee: A person employed, directly or by or
through any agency (including a contractor), whether
for remuneration or not, for carrying out activities ofthe organization or any part thereof, incidental to or

National Guidelines on Responsible Business Conduct

7

connected with those activities, in pursuance of theorganization’s stated objectives. It would also include
those who undertake these activities outside of thebusiness’s premises including their own homes.
Equity: An approach which recognizes the need,plans and delivers a fair and equivalent opportunity
across stakeholders to engage gainfully from theirinteractions with the business.
Ethical: Individual or collective behaviour that is inaccordance with accepted written and / or unwritten
codes of principles and values that govern decisions,actions and conduct within a business in the context
of a particular situation and is consistent withaccepted norms of behaviour.
Fair Living Wages: A wage sufficient for a family tomeet its basic needs and which provides some ability
to deal with emergencies.
Freedom of Association: Workers and employers,
without distinction whatsoever, have the rightto establish and, subject only to the rules of theorganization concerned, to join organizations of theirown choosing without previous authorization.
Governance: Relates to “how” an organization makes
decisions, how it operates to achieve its objectives
and how stakeholders have their say in the processes.
Governance Structure: The formalized individual
or group of individuals charged with the ultimate
responsibility of oversight of a business. This wouldrefer to the equivalent of the Board for companies,
the partners for partnership firms and the owner ofthe business for sole proprietorships.
Grievance Redressal Mechanism: Mechanism
for any stakeholder individually or collectively toraise and resolve reasonable concerns affecting
them without impeding access to other judicial oradministrative remedies. The mechanism should be:
•
•
•
•
•

Clear, transparent and have independent
governance structures
Accessible
Predictable
Equitable
Based on dialogue and mediation

Harassment: Wide range of offensive behaviour
that is unwanted by the recipient and which the8perpetuator knows or ought to know is threatening
or disturbing.
Intellectual Property (IP): Refers to creations of
the mind, such as inventions, literary, musical andartistic works, and symbols, names, images, anddesigns used in commerce, for which the IP owners
are granted certain exclusive rights under thecorresponding national IP laws. Common types of IP
include patents (inventions), copyrights, trademarks,
industrial designs, software, geographic indications
and trade secrets, etc.
Involuntary Labour: All work or service thatis extracted under the menace of penalty. Also
includes terms such as forced labour, bonded labourand modern slavery.
Participation of Workers: Situation where
workers are involved in some way in the decisionmaking process of a business organization. Worker
participation can take many forms. There might bea consultative council in the company where tradeunions and management meet regularly to discuss
points of mutual interest. Workers can be organizedin quality circles and meet regularly in small groups
to discuss ways in which their work could be betterorganized.
Precautionary Principle: When human activities
may lead to morally unacceptable harm thatis scientifically plausible but uncertain, actions
shall be taken to avoid or diminish that harm.
Morally unacceptable harm refers to that which
may threaten human health, or is seriously andeffectively irreversible or inequitable to present or
future generations, or imposed without sufficientconsideration of the human rights of those affected.
Product: Any good and / or service produced for
introduction to trade or commerce, possessing
intrinsic value and capable of delivery to a consumer
in tangible form, intangible form or a combination
thereof.
Product Life Cycle: This refers to all the stages ofa product from extraction or acquisition of raw
materials through manufacturing and processing,
distribution and transportation, use and reuse,recycling and disposal. In the case of services, it
refers to all activities and processes from the design
to delivery.

National Guidelines on Responsible Business Conduct

Stakeholder: Individual or group concerned orinterested with or impacted by the activities of thebusinesses and vice-versa, now or in the future.
Typically, stakeholders of a business include, but is
not limited to, its investors/shareholders, employees(and their families), customers, communities,
value chain members and other business partners,
regulators, civil society actors, and media.
Sustainability: The outcome achieved by balancing
the social, environmental and economic impacts ofbusiness. It is the process that ensures that businessgoals are pursued without compromising any of thethree elements.
Sustainable: Being aligned with the tenet of meetingthe needs of the present without compromising theability of future generations to meet their own needs.

Value Chain: Refers to both the supply chain as wellas the value created by the distribution channel for
end-use customers. It also includes business partners
and those employed by value chain partners who
may work out of their own premises.
Vulnerable and Marginalized Groups: Group ofindividuals who are unable to realize their rights or
enjoy opportunities due to adverse physical, mental,social, economic, cultural, political, geographic or
health circumstances. These groups in India can be
identified on the basis, inter alia, of the following:••••

Gender and transgender (women, girls et al.)Age (children, elderly et al.)Descent/identity/ethnicity (caste, religion,scheduled castes, scheduled tribes, et al.)Occupation (displaced, landless small / marginal
farmers, migrant workers, et al.)Persons with disability
Political or religious beliefs

Traditional Knowledge: This refers to any indigenous
technical, ecological, scientific, medical or cultural
knowledge which is not necessarily documented
but is in use by or generally known to communities.
Typical examples include antiseptic properties ofneem, turmeric, etc.

Workplace: Place(s) where activities of theorganization are carried out in pursuance of its statedobjectives.

Transparent: Being open about decisions andactivities that affect society, the environment andthe economy, and the willingness of businesses tocommunicate information in clear, accurate, honest,
timely and complete manner.

Work-life balance: Broad concept including properbalancing of “work” (career and ambition) on one
hand and “life” (pleasure, leisure, family and spiritualdevelopment) on the other. Related, though broader,terms include “lifestyle balance” and “life balance”.

••

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9

Chapter 1:

Introduction

The Ministry of Corporate Affairs (MCA), Governmentof India, released a set of guidelines in 2011 called
the National Voluntary Guidelines on the Social,
Environmental and Economic Responsibilities ofBusiness (NVGs). This was expected to provide
guidance to businesses on what constitutes
responsible business conduct. In order to align the
NVGs with the Sustainable Development Goals(SDGs) and the ‘Respect’ pillar of the United Nations
Guiding Principles (UNGP) the process of revisionof NVGs was started in 2015. After, revision andupdation, the new principles are called the National
Guidelines on Responsible Business Conduct(NGRBC). As with the NVGs, the NGRBC has been
designed to assist businesses to perform above andbeyond the requirements of regulatory compliance.

Mandate & Rationale
The primary rationale for the update is to capture
key national and international developments inthe sustainable development agenda and business
responsibility field that have occurred since therelease of the NVGs in 2011. Some of the key driversof the NGRBC are given below:
1) The UN Guiding Principles for Business andHuman Rights (UNGPs): Through its resolution
17/4 of 16 June 2011, the UN Human Rights
Council endorsed the Guiding Principles on
Business and Human Rights: Implementing theUnited Nations ‘Protect, Respect and Remedy’
Framework. The UNGPs are grounded inrecognition of, a) the State’s existing obligations
to respect, protect and fulfil human rights andfundamental freedoms; b) the requirement ofbusiness enterprises to respect human rights,
and c) the need for access to effective remedy
for those who are affected by adverse businessrelated human rights impacts or abuse. Since
their release, the UNGPs have become theauthoritative global standard for Business andHuman Rights. In further support of the UNGPs,
the UN Human Rights Council establishedthe UN Working Group (UNWG) and tasked itwith facilitating the global dissemination andimplementation of the UNGPs. The UNWG has
strongly encouraged all States to develop a
National Action Plan (NAP) as part of the States’
responsibility to disseminate and implement the
UNGPs.
2) UN Sustainable Development Goals (SDGs):
In September 2015, the UN General Assembly
adopted the 2030 Agenda for Sustainable

Development which established seventeen
Sustainable Development Goals (SDGs),
comprising targets and indicators, as well as
follow-up and review mechanisms. Significantly,
the SDGs recognize the role of business as a major
driver for economic growth and infrastructure,whilst explicitly calling for businesses to act
in accordance with the UNGPs. The SDGs are
mapped against the NGRBC in Annexure 4.
3) Paris Agreement on Climate Change (2015):
This is an agreement under the United Nations
Framework for Climate Change (UNFCC) reachedin December 2015, in which countries havecommitted to take steps to combat climatechange and adapt to its effects. India ratified
the agreement on 2nd October 2016,and
its commitments are called the National
Determined Contributions (NDCs). The Paris
Agreement also constitutes SDG 13.
4) Core Conventions 138 and 182 on Child Labourby the International Labour Organization(ILO): India, in June 2017, ratified ILO Core
Conventions 138 (minimum age of employmentof children) and ILO Core Convention 182 (worst
forms of child labour).
5) Annual Business Responsibility Reports(ABRRs): In 2012, the Securities Exchange Boardof India (SEBI) amended the Listing Agreement
for companies listed in the stock exchanges inIndia, and mandated the submission of an ABBRs
by the top 100 listed companies. The ABRR isbased on the Business Reporting Frameworkof the NVGs, and SEBI has since extended thisrequirement to the top 500 listed companies.
6) Companies’ Act 2013: Notified in the Gazetteof India on 30 August 2013, Section 135 of
the Companies Act 2013 requires companies
to undertake Corporate Social Responsibility(CSR) initiatives in communities, and has since,
provided additional rules and guidance on theareas and target groups of such interventions
in consistency with national socio-economic
priorities.

Applicability
The NGRBC are designed to be used by all businesses,
irrespective of their ownership, size, sector, structure
or location. It is expected that all businesses investingor operating in India, including foreign multinational
corporations (MNCs) will follow these guidelines.
Correspondingly, the NGRBC also provide a useful

National Guidelines on Responsible Business Conduct

11

framework for guiding Indian MNCs in their overseas
operations, in addition to aligning with applicable
local national standards and norms governing
responsible business conduct.
Furthermore, the NGRBC reiterate the need toencourage businesses to ensure that not only do they
follow these guidelines in business contexts directly
within their control or influence, but that they also
encourage and support their suppliers, vendors,
distributors, partners and other collaborators tofollow them.
Responsibility for Adoption
Whereas the NVGs made several references tothe critical role of the governance structure andcompanies’ leadership in ensuring adoption andreview of the guidelines, the NGRBC has taken thisrequirement a step further by identifying specificaspects of each Principle as part of the duty andresponsibility of the highest governance structureof the business to oversee the implementation andadherence to these guidelines in their business.
While the highest governance structure, in thecase of companies and corporations is the Board,
the responsibility for adoption of the NGRBC inproprietorships, partnerships, and other types ofbusiness is assumed in the present context to rest withthe owner/s, partner/s, and/or, any other structure
responsible for the highest level of decision-making
and governance functions in the business.
It is worthwhile to emphasize that all Principles of
the NGRBC are equally important, inter-related, interdependent and non-divisible, and businesses should

12

adopt them to demonstrate their commitment tobeing a responsible business, and accrue the full
benefits of sustainable business strategies.

Content and Structure
The NGRBC consist of two chapters and an expanded
set of annexures. While the Principles have been
updated, they have retained the articulation anddescription of those in the NVGs. The connectedCore Elements enhance the operationalization ofeach Principle. The details in the annexures provide
practical guidance to businesses on the adoption
and implementation of these guidelines. Keeping theimportance of Micro, Small and Medium Enterprises(MSMEs) in view, the business case for adoption of
NGRBC by the MSMEs is given in Annexure 2.
An updated Business Responsibility Reporting
Framework (BRRF) has been included for reportingof actions taken by businesses vis-à-vis the Principles
and Core Elements. The BRRF is meant to serveas an internal tool for companies to assess where
they are in their journey of responsible businessconduct and identify opportunities for improvement.
Guidance on how this framework may be used bybusinesses is included as an annexure. Additionally,
the BRRF can serve as a framework for regulators
to develop disclosure formats (e.g. Annual BusinessResponsibility Report (ABRR) mandated by the
Securities and Exchange Bureau of India (SEBI) basedon NVGs).
The last part of the NGRBC contains a set of usefulreferences and resources which businesses may
consult as part of their implementation efforts.

National Guidelines on Responsible Business ConductChapter 2:
Principles andCore Elements

This chapter contains the nine thematic pillars ofbusiness responsibility which are called Principles.
Each Principle is introduced as a statement andfollowed by a narration of the essential aspects of
the Principle, referred to as the brief description.
A reading of each Principle and brief description
should provide a clear idea of the essential spirit andintent of the Principle.
Each Principle is accompanied by a set of
requirements and actions that are essential to theoperationalization of the Principle, referred to as theCore Elements. The information sought in Annexure 3of the Guidelines (Business Responsibility Reporting
Framework) is derived from the Core Elements.
The Principles are interdependent, interrelated andnon-divisible, and businesses are urged to address
them holistically. Annexure 1 of the Guidelines
provides guidance to all businesses on the adoption
and implementation of the Principles. Furthermore,businesses impact different stakeholders in different
ways. Therefore, while applying these principles,businesses need to be sensitive to characteristics,
such as caste, creed, sex, race, ethnicity, age, colour,
religion, disability, socio-economic status or sexual
orientation. Though this has not been specificallymentioned in the Principles and Core Elements,
businesses are expected to keep this in mind. Most
importantly, the ultimate responsibility for adoptionof the Principles rests with the highest governancestructure of the business.

National Guidelines on Responsible Business Conduct13

Principle 1:
Businesses should conduct
and govern themselves withintegrity, and in a manner thatis ethical, transparent, andaccountable.

Brief Description

4.

The Governance Structure should disclose andcommunicate transparently and enable accessto information about the policies, procedures,
performance (financial and non-financial), anddecisions of their enterprise, that impact theirstakeholders, especially those that are most at
risk to business impacts and communities thatare vulnerable and marginalized.

5.

The Governance Structure should takeresponsibility for meeting all its statutory
obligations in line with the spirit of the law,enabling fair competition and ensuring it treats
all its stakeholders in an equitable manner.

6.

The Governance Structure should ensure thatthe business avoids complicity with the actionsof any third party that violates any of the
Principles contained in these Guidelines.

7.

The Governance Structure should put in placeappropriate structures, policies and procedures
to address conflicts of interest involving its
members, employees and business partners.

8.

The Governance Structure should put in placeappropriate structures, codes, policies, andprocedures to ensure that the business does notengage in illegal and abusive practices, bribery
and corruption, and ensure timely and fairaction in case such transgressions are detected.

9.

The Governance Structure should ensure thatthe business contributes to public finances bytimely and complete payment of all applicabletaxes in the letter and spirit of the laws andregulations governing such payments.

This Principle recognizes that ethical behaviour
in all operations, functions and processes, isthe cornerstone of businesses guiding theirgovernance of economic, social and environmental
responsibilities.
The Principle emphasizes that disclosures on businessdecisions and actions that impact stakeholders
form the fundamental basis of operationalizing
responsible business conduct and should beaccessible to all relevant stakeholders.
It recognizes that businesses are an integral part ofsociety and that they will hold themselves accountable
for the effective adoption, implementation, and themaking of disclosures on their performance withrespect to the Core Elements of these Guidelines.
The Principle further emphasizes that the governancestructure of the business should ensure this, in linewith SDG 16.

Core Elements
1.

The governance structure should develop and
put in place structures, policies and proceduresthat promote this Principle, prevent its
contravention and effect prompt and fair action
against any transgressions.

2.

The Governance Structure should ensurethat the Principles of these Guidelines areunderstood, adopted and implemented
throughout the operations of their business.

3.

The Governance Structure should also promote
the adoption of this Principle across the value
chain of their business.

National Guidelines on Responsible Business Conduct15

Principle 2:Businesses should
provide goods andservices in a manner thatis sustainable and safe.

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National Guidelines on Responsible Business Conduct

Brief Description

Core Elements

This Principle recognizes the proposition of SDG 12,
that sustainable production and consumption areinterrelated, contribute to enhancing the quality oflife and towards protecting and preserving earth’s
natural resources.

1.

Businesses should, in designing, producing andmaking available goods and services, endeavour
to ensure that resource-efficient and low-carbon
processes and technologies are deployed tominimize adverse environmental and social
impacts.

2.

Businesses should provide stakeholders acrossthe value chain with adequate information
about environmental and social issues andimpacts across product life cycle from design todisposal. This may be done through appropriate
and relevant tools such as certifications, labels,
ratings and other communication and disclosure
platforms including reports, websites, etc.

3.

Businesses should increasingly take responsibility
for the safe collection, reuse and recycling of theirproducts at life so as to build a circular economy
as a part of the notion of extended producer
responsibility that is increasingly becoming apart of regulation in India and globally.

The Principle further emphasizes that businesses
should focus on safety and resource-efficiency in thedesign and manufacture of their products, and use
their products in a manner that creates value while
minimizing and mitigating its adverse impacts on
the environment and society through all stages of
its life cycle, from design to final disposal. Over time,businesses should embrace the idea of circularity inall its operations.
In order to do so, the Principle encourages businesses
to understand all material sustainability issues acrosstheir product life cycle and value chain.

National Guidelines on Responsible Business Conduct17

Principle 3:
Businesses should
respect and promote
the well-being of all
employees, including
those in their value
chains.

Brief Description

and provide access to appropriate grievance
redressal mechanisms.

This Principle encompasses all policies and practices
relating to the equity, dignity and well-being, andprovision of decent work (as indicated in SDG 8), of all
employees engaged within a business or in its value
chain, without any discrimination and in a way that
promotes diversity. The principle recognizes that thewell-being of an employee also includes the wellbeing of her/his family.

Core Elements
1.

The Governance Structure should ensurethat the business complies with all regulatory
requirements pertaining to its employees, andthat there are systems and processes in place toenable this to be done by its value chain partners.

2.

Businesses should ensure equal opportunities
at the time of recruitment, during the courseof employment, and at the time of separation
without any discrimination.

3.

Businesses should promote and respect theright to freedom of association, participationof workers, and collective bargaining of all
employees including contract and casual labour,

4.

Businesses should not use child labour, coercive
or forced labour, or any form of involuntarylabour, paid or unpaid.

5.

Businesses should put systems and processes inplace to support the work-life balance of all its
employees.

6.

Businesses should ensure fair, timely andtransparent payment of statutory wages of all its
employees, including contract and casual labour
without discrimination.

7.

Businesses should aspire to pay fair living wages
to meet basic needs and economic security of all
employees, including casual and contract labour.

8.

Businesses should provide a workplace“environment that is safe, hygienic, accessible
to the” - there is no space between the words
differently abled and which upholds the dignityof the employees. Businesses should engage andconsult with their employees on this provision.

9.

Businesses
shouldensurecontinuous
upgradation of skill and competence of all
employees by providing access to necessary
learning opportunities, on an equal and nondiscriminatory basis. They should promote
career development through human resource
interventions.

10. Businesses should create systems and practices
to ensure a humane workplace free from,violence and harassment (including sexual
harassment); a workplace where employees feelsafe and secure, with adequate provisions forgrievance redressal.

National Guidelines on Responsible Business Conduct19

Principle 4:
Businesses should
respect the interests ofand be responsive to all its
stakeholders.

Brief Description

Core Elements

This Principle recognizes that businesses operate inan eco-system comprising a number of stakeholders,beyond shareholders and investors, and that
their activities impact natural resources, habitats,communities and the environment.

1.

Governance Structures should ensure that thebusiness acknowledges, assumes responsibility,
and is transparent about the impact of theirpolicies, decisions, products and associatedoperations on all stakeholders, and the naturalenvironment.

2.

Businesses should develop systems, processes
and mechanisms to identify its stakeholders,
understand their expectations and concerns,
define the purpose and scope of the engagement,
consult with them in developing policies andprocesses that impact them, and commit
to resolving any differences and redressing
grievances in a just, fair and constructive manner.

3.

Businesses should enable all stakeholders tobenefit fairly from the value generated by thebusinesses, and any conflicts or differences
arising from the impact of business operationsor the sharing of the value generated by thebusinesses should be resolved in a just, fair andequitable manner.

The Principle acknowledges that it is the responsibilityof businesses to ensure that the interests of all
stakeholders, especially those who may be vulnerable
and marginalized, are protected.
The Principle further recognizes that businesses havea responsibility to maximize the positive impacts
and minimize and mitigate the adverse impacts of
its products, operations, and practices on all theirstakeholders.

National Guidelines on Responsible Business Conduct

21

Principle 5:
Businesses should
respect andpromote humanrights.

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National Guidelines on Responsible Business Conduct

Brief Description

Core Elements

This Principle recognizes that human rights are rights
inherent to all human beings, and that everyone,
individually or collectively, is entitled to these rights,
without discrimination. It further recognizes thathuman rights are inherent, inalienable, interrelated,interdependent and indivisible.

1.

The Governance Structure should ensure thatthe business undertakes to make its employees
aware of the human rights content of theConstitution of India, relevant national laws andpolicies, and the International Bill of Human
Rights and their application to businesses as
outlined in the United Nations Guiding Principles
for Business and Human Rights. It should further
ensure that the responsibility for addressing
such impacts is assigned to the appropriate leveland function within the business.

2.

The Governance Structure should ensure thatthe business has in place such policies, structuresand procedures that demonstrate respect for thehuman rights of all stakeholders impacted by its
business. This includes carrying out human rights
due diligence to identify, prevent, mitigate andaccount for how they address adverse humanrights impacts.

3.

The Governance Structure should ensure that
their business, where it is causing, contributing
or otherwise linked to adverse human rights
impacts, takes corrective actions to address suchimpacts.

4.

Businesses should promote the awareness andrealization of human rights across its value chain.

5.

Businesses should ensure that all individuals
and groups whose human rights are impacted
by them have access to effective grievance
redressal mechanisms.

The Principle is inspired, informed and guided by
the Constitution of India and the International Bill of
Rights and recognizes the primacy of the State’s duty
to protect and fulfil human rights.
The Principle is further informed and guided by the
UN Guiding Principles on Business and Human Rights
in its articulation of the responsibility of businesses torespect human rights. It affirms that the responsibilityof businesses to respect human rights requires thatit avoids causing or contributing to adverse humanrights impacts, and that it addresses such impacts
when they occur. The Principle urges businesses tobe especially responsive to such persons, individuallyor collectively, who are most vulnerable to, or at riskof, such adverse human rights impacts.

National Guidelines on Responsible Business Conduct23

Principle 6:
Businesses should
respect and make efforts
to protect and restore theenvironment.

24

National Guidelines on Responsible Business Conduct

Brief Description

1.

The Governance Structure should ensure thatthe business formulates appropriate policies,
procedures and structures to assess, measure
and address its adverse impacts on theenvironment at all its locations, at all stages of its
life cycle from establishment to closure. Special
care should be taken where these impacts occur
in eco-sensitive areas.

2.

Businesses should develop appropriate
strategies for sustainable and efficient use ofnatural resources and manufactured materials,
giving due consideration to expectations andconcerns of all stakeholders.

3.

Businesses should define measurable key
performance indicators and targets to monitor
their performance on environmental aspects
such as water, air, land-use, forest, energy,materials, waste, biodiversity, built environmentand so on.

4.

Businesses should focus on addressing climatechange through development of both mitigation
and adaptation measures, and build climate
resilience and in line with India’s Nationally
Determined Contributions to the Paris Climate
Change Agreement and the National/State
Action Plans on Climate Change.

5.

Businesses should learn from industry bestpractices for promoting reduction, reuse,recycling and recovery of material and resources,and encourage and motivate its stakeholders,
particularly consumers and business partners, todo the same.

6.

Businesses should seek to improve theirenvironmental performance by adopting
innovative, resource-efficient and low-carbon
technologies and solutions resulting in lower
resource footprint, lesser material consumption
and more positive impact on environment,
economy and society.

This Principle recognizes that environmental
responsibility is a prerequisite for sustainableeconomic growth and for the well-being of society.
The Principle emphasizes that environmental issues
are interconnected at the local, regional and global
levels, which makes it imperative for businesses toaddress issues like pollution, biodiversity conservation,
sustainable use of natural resources and climatechange (mitigation, adaptation and resilience) in ajust, comprehensive and systematic manner. These arealigned with SDGs 11, 13, 14 and 15.
The Principle encourages businesses to assess
environment impacts of its products and operations
and take steps to minimize and mitigate its adverse
impacts where these cannot be avoided.
The Principle encourages businesses to adopt
environmental practices and processes that minimize
or eliminate the adverse impacts of its operations
and across the value chain.
The Principle encourages businesses to follow the
Precautionary Principle in all its actions.

Core Elements

National Guidelines on Responsible Business Conduct25

Principle 7:
Businesses, when engaging
in influencing public andregulatory policy, should
do so in a manner that is
responsible and transparent.

26

National Guidelines on Responsible Business Conduct

Brief Description

Core Elements

This Principle recognizes that businesses operate
within specified national and international legislativeand policy frameworks, which guide their growth
and also provide for certain desirable restrictions andboundaries.

1.

The Governance Structure should ensure thatits advocacy positions are consistent with the
Principles contained in these Guidelines andpublicly disclosed.

2.

Businesses should, to the extent possible,
undertake policy advocacy through trade andindustry chambers and associations, and othersimilar collective platforms.

3.

Businesses should ensure that its policy advocacy
positions promote fair competition and respectfor human rights.

The Principle recognizes the legitimacy of businesses
to engage with governments for redressal of agrievance or for influencing public policy.
The Principle emphasizes that public policy advocacy
must expand public good.

National Guidelines on Responsible Business Conduct27

Principle 8:
Businesses should promote
inclusive growth and equitabledevelopment.

28

National Guidelines on Responsible Business Conduct

Brief Description

Core Elements

This Principle recognizes the challenges of social andeconomic development faced by India, and builds
upon the national and local development agenda as
articulated in government policies and priorities. Thisis particularly significant in zones affected by social
disharmony and low human development.

1.

The Governance Structure shall ensure thatthe business takes appropriate actions tominimize any adverse impacts that it has onsocial, cultural and economic aspects of society
including arising from land acquisition and use,
construction of facilities and operations.

The Principle recognizes the value of the energy andenterprise of businesses and encourages them toinnovate and contribute to the overall developmentof the country with a specific focus on disadvantaged,
vulnerable and marginalized communities, as
articulated in Section 135 of the Companies Act,
2013.

2.

Businesses should assess, measure andunderstand their impact on social, and economic
development, and respond through appropriate
action to minimize and mitigate its negative
impacts on society.

3.

Businesses should innovate and invest in
products, technologies and processes that
promote the well-being of all segments ofsociety, including vulnerable and marginalizedgroups.

4.

Businesses should respond to national andlocal development priorities and understandthe needs and concerns of local communities,
particularly vulnerable and marginalised
groups and in regions that are underdeveloped,
while designing and implementing their CSR
programmes.

5.

Businesses should make efforts to minimize thenegative impacts of displacement of people
and disruption of livelihoods through theirbusiness operations and where displacement isunavoidable, this process must be undertaken
in a humane, participative, informed andtransparent manner, where just and faircompensation is paid to those impacted.

6.

Businesses should respect all forms of intellectual
property and traditional knowledge and makeefforts to ensure that benefits derived from theirknowledge are shared equitably.

The Principle also emphasizes the need forcollaboration amongst businesses, government
agencies and civil society in furthering thisdevelopment agenda in line with SDG 17.
The Principle reiterates that business success,inclusive growth and equitable development areinterdependent.

National Guidelines on Responsible Business Conduct29

Principle 9:Businesses should
engage with and provide
value to their consumers
in a responsible manner.

30

National Guidelines on Responsible Business Conduct

Brief Description

Core Elements

This Principle is based on the fact that the basic aimof a business entity is to provide goods and services
to its consumers that are safe to use, and in a mannerthat creates value for both. .

1.

Governance Structures should ensure that thebusiness minimizes and mitigates any adverse
impact of its goods and services on consumers,
the natural environment and society at large.

The Principle recognizes that consumers have thefreedom of choice in the selection and usage ofgoods and services, and that the enterprises will
strive to make available products that are safe,
competitively priced, easy to use and safe to disposeof, for the benefit of their consumers.

2.

Businesses should ensure that they do not restrict
the freedom of choice and free competition inany manner while designing, promoting andselling their products.

3.

Businesses should disclose all information
accurately, through labelling and other means,including the risks to the individual, to society,and to the planet, from the use of the products,
so that the consumers can exercise their freedom
to consume in a responsible manner.

4.

Businesses should manage consumer data in a
way that does not infringe upon their right toprivacy.

5.

Businesses should make consumers aware of,and provide information and guidance to themon, safe and responsible usage and disposal of
their products (including reuse and recycling),
and to eliminate over-consumption.

6.

Businesses should promote and advertise theirproducts in ways that do not mislead or confuse
the consumers or violate any of the Principles inthese Guidelines.

7.

Businesses should provide appropriate grievance
redressal mechanisms that are transparent andaccessible, to address consumer concerns andfeedback.

8.

Businesses that provide essential services, e.g..
utilities, should enable universal access, including
to those whose services have been discontinued
for any reason, in a non-discriminatory andresponsible manner.

The Principle also recognizes that businesses
should play a key role, along with other relevant
stakeholders, in mitigating the adverse impacts that
excessive consumption of its products may have on
the overall well-being of individuals, society and ourplanet, in line with SDG 12.

National Guidelines on Responsible Business Conduct

31

ANNEXURES

32

National Guidelines on Responsible Business Conduct

Annexure 1:
Guidance on Adoption of NGRBC
What does adoption mean?

The Principles and Core Elements contained in the
NGRBC are designed to enable businesses to conduct
themselves responsibly. Therefore, adopting theseguidelines refers to the integration of the Principles
and Core Elements into the core business strategy
and operations of an enterprise including its value
chain.
So, how will the Governance Structure of a businessknow whether it has successfully integrated these
NGRBC? Here are some indicators:•

It should have in place, policies and guidance thatare approved at the highest level and cover all the
Principles.

•

The key performance indicators of the businessshould incorporate all the Principles of the NGRBC
and those Core Elements that significantly impact
or are impacted by the business.

•

The operating procedures of the business should
also cover those Core Elements that significantly
impact or are impacted by the business.

The Business Responsibility Reporting Framework(BRRF) provided in Annexure 3 of these guidelines
is designed as an internal tool to help businesses
determine how well aligned they are to the NGRBC.
Key Enablers
Experience suggests that there are some key enablersof businesses that help them successfully integratesustainability principles into their core processes.
These include:•

Leadership commitment: The Governance
Structure of the business (Board in the case ofcompanies, owner(s)/partner(s) in other forms)
needs to be convinced that the success of thebusiness depends upon adopting the NGRBC. The
Chairman/CEO/Owner-Manager needs to playa proactive role in convincing the Governance
Structure, which is most effectively done bydemonstrating the business benefit of being
responsible.

•

Employee engagement: The employees too
must be convinced of the need to be
responsible. Again, the Governance Structure
and top management must communicate
this to all employees so that the Principles are
fully understood across the organization andcomprehensively implemented.

•

Stakeholder engagement: Recognizing thatall stakeholders play a crucial role in a business’s
success, the top management of the company
must map out its stakeholders and proactively
engage and build strong relationships with themon a consistent and continuous basis.

•

Disclosure and reporting: In addition to
engaging with stakeholders including employees,
the proactive public disclosure by companies of
their impact on society and the environment isalso essential.

The Business Case for Adoption
That businesses are expected to conduct
themselves responsibly is an essential componentof the social contract between businesses
and society. Increasingly, businesses are also
recognizing that responsible business conduct
provides benefits to both the business and society
in the short term as well as in the long term. To help
businesses determine these benefits, they may use
a tool called the Business Case Matrix, provided in
Annexure 5. Every business can develop such amatrix, in its own context, for each Core Element,
and thus determine which of them are a relatively
higher priority to the business. However, as statedearlier, the Principles detailed in these guidelines
are interdependent, interrelated and nondivisible, and responsible businesses are expectedto adhere to all the Principles and Core Elements.

National Guidelines on Responsible Business Conduct33

Prioritize
Core
Elements

Review anddeveloppolicies

Determine
Ambition

Set Targets

•
•
•
•

Vision, mission and values
Business success factors
Material sustainability issues
Laws, regulations, global covenants and good practices•••

Map current policies, processes, guidelines vis-a-vis prioritized Core Elements
Develop new policies where there are gaps (in consultation with stakeholders)Get policies endorsed by the Governance Structure••

Determine performance level for each prioritized Core Element
Two performance levels suggested in the Guidelines: Essential and Leadership••

Select indicators for each prioritized Core Element that reflects the ambition
Set targets for each indicator / issue

The Adoption Processmaterial sustainability issues must be treatedas high priority. In cases where the businesshas not undertaken its own materiality
assessment, it should go by suggestions
found in globally accepted guidelines.

The flowchart given below summarizes the processbusinesses may follow to adopt the NGRBC andintegrate them with the core business.
Some of the key steps are described in greater detailbelow,•

4. Legal and voluntary compliances: Everybusiness must know the specific laws andregulations, current and emerging, whichpertain to each of the Core Elements. It isstressed that compliance with the laws andregulations of the land is non-negotiable. It
may also be noted that those businesses thatare part of a supply chain are also subject tocodes and standards that their buyers may
require them to comply with.

Prioritizing the Core Elements: The first stepis that the business must identify those Core
Elements that are priority. As a rule of thumb, it ishighly likely that each Principle will have at least
one Core Element which is of higher priority forthe business. In order to do this prioritization, abusiness must map all the Core Elements against:
1. Vision, mission and values: Those thatalign with or contribute to these must be
considered priority.
2. Business success factors: These are
typically articulated in the business strategy.
3. Material sustainability issues: Manybusinesses conduct a materiality analysis todetermine the environment and social issues
that are of high concern to its stakeholders(ideally based on detailed stakeholder
engagements) and have a high impact on
business (based on detailed internal analysis
on key business success factors). The Core
Elements that align with or contribute to these34•

Integrating Prioritized Core Elements into Core
Business: All the prioritized Core Elements mustthen be integrated into core business strategy. In
order to do this, the business must:
1.

Review its current policies and guidelines
to ensure that they cover all the prioritizedCore Elements. Where there are gaps, thesemust be revised.

2.

In the case of those Core Elements where
the Governance Structure has a role inensuring implementation, these policies
and guidelines must be endorsed by theGovernance Structure.

National Guidelines on Responsible Business Conduct

3.

4.

The business must determine what its
ambition is for each prioritized Core
Element, i.e. the performance level it wishes
to achieve for each. As mentioned earlier,the base performance has to be compliancewith the law or regulation, but a business
may decide to be more ambitious andtake a leadership position by setting itself
a higher performance target. Annexure 3
discusses this in greater details and suggests
two performance levels – Essential andLeadership.
Annexure 3 outlines the performanceindicators for relevant Core Elements atthese two levels – Essential and Leadership.
Businesses may select the indicators for theirprioritized Core Elements that reflect theirambition and set 3-5 year targets.

The map will enable the business to ascertain
specific sustainability risks or opportunities
that may reside in its value chain which may bedifferent from those faced by the business itself.
•

Prioritizing Core Elements for value chain
partners: Using the value chain map and as partof the materiality assessment referred to earlier
in this annexure, businesses should prioritize
the Core Elements which are important for theirvalue chain partners to align themselves with.
This is best done in consultation with their major
Tier 1 partners so that ownership is built fromthe beginning.

•

Setting policy frameworks: Businesses
should have in place, policies and guidelinesthat facilitate adoption of the NGRBC acrosstheir value chain partners. These policies andguidelines, where required, should be endorsedby the Governance Structure of the business.
Again, this will be most effective when done in
consultation with their Tier 1 partners.

•

Establishing engagement processes: Theprioritized Core Elements should be embedded
in processes for all points of engagementwith value chain partners including diligence,
selection, monitoring, periodic engagement,
feedback, and recognition of good practice.
Such processes are an effective means to build
actions around the prioritized Core Elements,
signal the business’ responsible intent, can beused to incentivize integration of sustainability
principles across the value chain and, in the longterm, will enhance security of supply for thebusiness through a stronger relationship with
their partners.

•

Cascading responsibility: Businesses should
recognize that their value chains partners, direct
and indirect, will range from large multinational
corporations to Micro, Small and Medium
Enterprises (further details on the role of MSMEs
in value chains are provided in Annexure 2),
who will have differentiated capacities andconsiderations while adopting the Principles
and Core Elements. Businesses should guideand support them in their efforts to adopt theseguidelines including collaborating with otherbusinesses. Businesses should also support their
Tier 1 partners to cascade this process to thesubsequent tiers in the value chain.

Covering Value Chains
Value chains, encompassing all upstream sourcing
channels and downstream distribution channels, are
an integral part of all businesses, have a definitiverole in their success, and feature in their core
strategies. While integrating the NGRBC into theircore strategies and operations, businesses should
specifically encourage their adoption by their value
chain partners. Responsible businesses should bewell placed to understand the social, environment
and economic impact their value chain partners haveon their own enterprise as well as on the external
world.
Suggested steps for this include:•

Mapping the value chain: Businesses should
create a map of their direct (or Tier 1) value chain
partners and also cover, to the extent feasible,
indirect members of the value chain whotransact with the Tier 1 value chain partners. A
value chain map, which traces the key activities
involved in bringing a product from key inputs
to the consumer, should be created for all major
products of a business and requires collaboration
among all functions within the business which
work on the specific products. This should
provide visibility of physical locations, resource
dependencies,
contractual/compliancestatus, financial status and storage/logistics
arrangements for value chain partners as wellas any interdependencies between the partners.

National Guidelines on Responsible Business Conduct

35

Annexure 2:
Guidance for Micro, Small andMedium Enterprises
Significance of MSMEs for NGRBCMSMEs contribute significantly to the GDP,
employment and social equity of India. They are the
2nd largest employer, after agriculture, employing
an estimated 100 million people which is almost ten
times that of the employment in the government
and large private sector put together. MSMEs arepresent in almost all economic activities, ranging
from crafts to services and high-end industrial
activities. The product range spreads across sectors
including handicrafts, handlooms, textiles, garments,
leather, plastics, engineering, IT & IT enabled services,
hospitality, tourism, health care and several others. In
terms of markets, these enterprises are connectedwith rural markets to global value chains. Together
they contribute to 37% of industrial output, 40% of
manufactured exports and 37.54% of the GDP for2012-13 (Annual report of Ministry of MSME, Govt. ofIndia, 2015-16), with a considerable multiplier effecton the economy.
Another remarkable feature of the MSMEs in India isthat almost two-third of them are naturally organizedaround approximately 6000 geographic clusters, as apart of local, regional, national and global value chains.
These clusters in groups of contiguous villages, blocks
or districts are known for a range of crafts, industrial
products or services.

distinct although not mutually exclusive subgroups:a.

b. Vendors/suppliers for large buyers withdomestic base: The MSMEs in this group arelinked across several sectors where global
players have significant manufacturing or
sourcing base in India, such as automobiles,
engineering goods, aerospace, defence,
railways and large retail companies. Thereis also a wide range of MSME suppliers for
public procurement supplying to railways,
engineering companies, power sector
companies and a wide range of government
services across hospitals, schools, etc.
c.

MSMEs are, therefore, not a residual segment but avery significant component of the larger social andeconomic system, interconnected with a variety
of stakeholders. Hence, for the NGRBC to succeed,
widespread buy-in and adoption by the MSME sector
is necessary.
Classification of MSMEs
The Indian MSME sector can be broadly categorized
into two types:
1.

2.

Global value chains linked: This groupaccounts for increasing exposure of MSMEs
to the global business environment sincethe 1990s. Those in product categories likegarments, sports goods, furniture, chocolates,
beverages and other food products are well
exposed to individual and collective buyer
standards across environment, labour andother issues, and are hence reasonably intune with various responsible businessguidelines, codes and standards.

Emerging high growth start-ups: The
phenomenon of technology-based highgrowth start-ups is beginning to surge.
This is significant not only for the growthof individual enterprises but also with theirpower to disrupt the way classical brickand-mortar enterprises function. With amore positive socio-economic environment
for spawning start-ups with support fromacademic institutions, private funding
for risk capital, and government support,
this group is fast emerging as a significant
one. To illustrate there are technologybased aggregators of MSMEs that include
independent taxi operators, e-commerce
platforms and credit facilitators. These
entrepreneurs have joined the bandwagonof globally integrated Indian MSMEs.

MSMEs organized around local and regional value
chains: These comprise a large number of verysmall enterprises and is estimated to contribute
between half to two-thirds of the total MSME
output. However, their share has been shrinking
over the years making way for integration acrossnational and global value chains.

The Business Case for MSMEs to adopt the NGRBCMSMEs that are part of national & global value
chains: These can be further broken into three

There is no doubt that smaller businesses have fewer
resources and abilities to adhere to multiple laws,

36

National Guidelines on Responsible Business Conductregulations and guidelines. But the fact that severalof them already do clearly suggests that not only are
they capable of doing so but it is worth their while – inother words, it makes business sense to do so. So, what
are the business benefits of adopting these Principles
and Core Elements? Some of these are outlined here:
•

•

•

•

•

Increased access to markets and customers:
MSMEs that are a part of national and global value
chains know that for them to gain new customers
and retain their existing ones, they have toconform to a number of sustainability codes andstandards that go well beyond compliance withlocal laws. These codes and standards, typicallyrelating to issues regarding environment andlabour, which are almost standard requirements
for those exporting to western countries, areincreasingly becoming universal, with several
Indian companies also expecting their supply
chains to conform to sustainability requirements.
Adopting the Principles herein may enable MSMEs
to become preferred suppliers to the increasing
number of customers who expect responsible
behaviour from their value chains.
Better preparedness for compliance: India
was a signatory to two global agreements in2015 – the Sustainable Development Goals
and Paris Agreement on Climate Change. As aconsequence, businesses will be expected to do
more in the social and environmental spheres,and this will, inevitably, lead to tighter regulations
over the years. The MSME sector too will face thischallenge. Further, there are already multiple
buyer codes and standards that MSMEs are
expected to align themselves with and these will
only increase. Adopting the NGRBC will enable
MSMEs to be better prepared for this future.

fund them at a premium or do not fund them at all.
The Indian Banks Association has recently comeup with a set of National Voluntary Guidelines
for Responsible Finance, which asks members tofactor commitment to responsible business intheir lending and investment decisions. MSMEs
that adopt the NGRBC may find themselvesbetter placed to negotiate better financial termswith banks and financial institutions to meet their
growth plans.
Adopting the NGRBC
Annexure 1 described (a) what “adopting” means and(b) identifying the “enablers” for successful adoption.
These are applicable in full measure to MSMEs as well.
Owners and partners have to play a leadership rolein understanding the Principles and Core Elements
outlined in the NGRBC, adopting them and making
their employees, customers and funders aware sothat they derive full benefit from this commitment.
Reporting their commitments and activities is aneffective way of communicating their performance tothese key stakeholders.
The steps that MSMEs should take to adopt the NGRBC
are also described in Annexure 2. Recognizing thatsome of these steps can be undertaken only by thosebusinesses that are relatively larger and more mature,
given below are what MSMEs must do at the bareminimum:1.

De-risking operations: Adopting theseguidelines will enable MSMEs to reduce the riskof their operations being affected due to noncompliance with either regulations or customer
expectations (as expressed in their own codesand standards).
Cost savings and increase in productivity: Thereis mounting evidence, even amongst MSMEs, thatinvesting in processes that reduce environmental
footprints, waste, and drudgery, and increase thequality of life of employees, provides benefits thatpays back these investments quickly and in goodmeasure.
Access to funds: Several banks and financial
institutions, including in India, are increasingly
looking at businesses that do not conform to
responsible business practices as risky and either

2.

Prioritizing the Core Elements. The first step in
adoption has to be prioritizing the Core Elements.
In order to do this, the MSME must map all theCore Elements against:a.

Its own vision, mission, values and businesssuccess factors: Those that align with orcontribute to these must be considered
priority.

b.

Laws and regulations: All Core Elements thatare governed by a law or regulation, current
or emerging, have to be prioritized.

c.

Buyer/Customer codes: All codes adopted
by buyers/customers, current and potential,
must be studied and understood and thoseCore Elements that cover these requirements
must be prioritized.

Embedding Prioritized Core Elements: All theprioritized Core Elements must then be integrated
into the core business. This process has beendetailed in Annexure 2. All MSMEs must set theirambitions at the Essential level but those that set
themselves higher ambitions are likely to reap the
benefits of this in the medium to long term.

National Guidelines on Responsible Business Conduct

37

Annexure 3:
Business Responsibility
Reporting Framework
This annexure details the reporting frameworkassociated with the National Guidelines for
Responsible Business Conduct. It consists of three
sections: (a) Section A – General Disclosures,covering operational, financial and ownership
related information, (b) Section B – Management andProcess Disclosures covering the structures, policies
and processes to integrate the Guidelines, and (c)Section C – Principle-wise Performance Indicators
covering how well businesses are performing inpursuit of these Guidelines. Care must be taken to
identify measurable indicators and performanceagainst each Core Element of each Principle detailedin Chapter 2.
Principal purpose of this reporting framework
The principal purpose of this reporting framework is
to serve as an internal tool for businesses wishing toalign themselves with the NGRBC. It should not beseen as a mandatory reporting format as that is thedomain of a regulator or law.
The Performance Indicators in Section C are divided
into two types – Essential Indicators and Leadership
Indicators. All businesses irrespective of size, sector,
or ownership structure, should be able to complete
the Essential Indicators to consider themselves
responsible at a base level – the extent to which
they are able to complete this indicates how mature
they are. The extent to which they can complete theLeadership Indicators indicates how far down thepath to leadership they have reached; the data gaps
identify Opportunities for Improvement.
Further, by comparing how much of this framework
a business has been able to complete in the current
year vis-à-vis the previous year, will help a company
determine if it is on the path to leadership andwhether the pace is in line with its ambition.
Of course, businesses may use this reporting

38

framework to voluntarily disclose their commitment
to and performance against their economic, socialand environmental impacts. A growing number ofbusinesses are already doing this and are reporting
several benefits, internal and external, as a result of
their commitment to disclosure and reporting.
Annexure 5 provides a note on how this framework
may be used as a tool by businesses to assess theiralignment with the NGRBC.
Additional purpose of this reporting framework
While this reporting framework is not meant to bea mandatory reporting format, a design principlethat was used in its development was that it canbe adapted into one by any legitimate authority or
regulator. This was done keeping in mind that there
is an increasing trend globally to mandate greatertransparency from all organizations that impact thesociety and the planet, something that SEBI also did
when it mandated Business Responsibility Reporting
against the NVGs in 2012.
Aggregate Reporting – Useful methodology for
MSMEs in clusters
MSMEs can now imbibe a method of preparing
an aggregate report, i.e. the result of applying theAggregate Reporting (AR) methodology to combine
data from individual units that belong in the samecluster (i.e. region/location) in order to create onecollective sustainability report. The small enterprisesof India can benefit from this reporting process, that
can identify significant issues that may impact thebusiness, and can lead to business benefits throughthe process of measurement, management andchange. The methodology is outlined in the learning
document for the project, “Scaling Up Sustainable
Development of MSME”. A link to this learning
document and examples of Aggregate Reports are inAnnexure 2.

National Guidelines on Responsible Business Conduct

SECTION A: GENERAL DISCLOSURES

Employees

Company details

10. Number of permanent employees:

1.

Name of the Company:

11. Contractual employees (seasonal, non-seasonal):

2.

Year of registration:

3.

Corporate Identity Number (CIN) of the Company(if applicable):

4.

Corporate
website:address,

telephone,

email

and

Products/services
5.

Sector(s) that the business is engaged in(industrial activity code):

6.

Goods manufactured/services provided (topthree by revenue):

7.

Brands (top five by respective share of market)
owned and percentage of revenue contributed:

9.

13. Percentage of women:a. On the Governance Structure:b. In top management, i.e. business andfunction heads;
Associate entities
14. Names of subsidiary / associate companies;
15. Details of Trust/Society/Section 8 company tofurther its CSR agenda:a.

Names;b.

Location of plants (in case of manufacturingbusinesses)

Organization form (Trust, Society, Company)and year of establishment;c.

Main objects/purpose;a.

National (Districts and states – top five by
employee strength):d.

Amounts and sources of funds received in
the reporting year;b.

International (Country – top three by
employee strength)):Operations
8.

12. Temporary employees:

16. Contact details of Nodal Officer for this report(name, designation, email id, phone number).

Location of major offices (in case of service
businesses)

SECTION B: MANAGEMENTDISCLOSURESa.

National (Districts and states – top five by
employee strength):b.

International (Country – top three by
employee strength)):This section is aimed at helping businesses
demonstrate the structures, policies and processes
put in place towards adopting the Principles andCore Elements.

AND

PROCESS

Disclosure Questions
P 1 P 2 P 3 P 4 P5 P 6 P 7 P8 P9Policy and management processes
1. Names of the policy / policies that covers each Principle
2. Core Elements related to the Principle that the policy/
policies cover
3. Policy/ policies relating to each principle that has beentranslated into guidelines and procedures
4. Extent to which manpower, planning and financial
resources have been allocated for the implementationof the policy/ policies relating to each Principle
5. National and International codes and standards
adopted mapped to various Principles
Governance, leadership and oversight
6. Names of the above policies that have been approvedby the Board/top management
7. Name of the specified committee(s) of the Board/
Director/Officer and processes to oversee theimplementation of the policy/ policies
8. The process for board/ top management to review
performance against the above policies andincorporating inputs (100 words)
National Guidelines on Responsible Business Conduct

39

Disclosure Questions
P 1 P 2 P 3 P 4 P5 P 6 P 7 P8 P9
9. Process for board/ top management to review
compliance with statutory requirements of relevanceto the Principles and rectify any non-compliances (100words)
10. Frequency of the reviews of the business’s alignment
with the Principles and Core Elements conducted by
the board/ top management
Stakeholder Engagement
11. Description of the process to identify your business’s
key stakeholders (100 words)
12. Description of the process to engage with yourstakeholders on the Principles (100 words)
13. Description of the processes to identify groups that arevulnerable and marginalized stakeholders (100 words).
14. Description of the processes to identify issues related
to inclusion and impact of adopting the Principles onvulnerable and marginalized stakeholders (100 words).
Communications
15. Description of process to communicate to stakeholders,the impact of your policies, procedures, decisions andperformance that impact them (100 words)
16. Description of how the business communicates theresults of stakeholder engagement in the publicdomain (100 words)
17. Description of the process of communicating
performance against these Guidelines to relevant
stakeholders (100 words)
18. Note on how disclosures and reporting helped in
improving business performance / strategy (50 words)

If answer to question (1) above is “No” i.e. not all Principles are covered by a policy, reasons to be stated:

QuestionsP1
The company has not understood the Principles
The company is not at a stage where it finds
itself in a position to formulate and implement
the policies on specified Principles
The company does not have financial or
manpower resources available for the task
It is planned to be done within next 6 months
It is planned to be done within next 12 months
Any other reason (please specify)

P2

P3

P4

P5

P6

P7

P8

P9

SECTION C: PRINCIPLE-WISE PERFORMANCE DISCLOSURE
This section is aimed at helping businesses demonstrate their performance in integrating the Principles andCore Elements with key processes and decisions. The information sought is categorized as “Essential” and“Leadership”. While the Essential level is expected from every business that has adopted these Guidelines,
the Leadership level is expected of businesses which aspire to progress to a higher level in their quest to besocially, environmentally, and ethically responsible.

40

National Guidelines on Responsible Business Conduct

PRINCIPLE 1
Essential Indicators
1. Month/year of last review by Governance 1.
Structure/ top management of performanceof the business across the Principles and Core
Elements of the Guidelines?
2. % Coverage of leadership team by awareness 2.
programmes on the Guidelines:
a. In reporting year
b. Total to date
3. % of suppliers and distributors (by value), in 3.
the year:a. Covered by awareness programmes for the
Guidelines?
b. Hadresponsible/sustainablebusiness
policies in place?
4. Number of meetings/ dialogues with minority 4.
shareholders that were organized in the year?
5. Number of complaints received on any aspectof the NGRBC in the year from:a. Shareholders/investors
5.
b. Lenders
6. Number of the above complaints pending
resolution at close of year?
6.
7. Value of non-disputed fines / penalties
imposed on your business by regulatory andjudicial institutions in the year?
8. Number of complaints / cases of corruption
and conflicts of interest that were registered in
the year?
9. Details of unmet obligations (fiscal, social,etc.) arising out of any benefits or concessions
provided by the central, state, or local
governments (100 words).

Leadership Indicators% coverage of all employees by awarenessprogrammes for the Guidelines:
a. In reporting year
b. Total to date
% of suppliers and distributors (by value)
covered by social and environmental audits:a. In reporting year
b. Total to dateWas report on responsible business conduct
made, in the year:
a. As per mandatory/global reporting
frameworks.
b. Available in the public domain.
c. Assured by a third party
Details of non-disputed fines/penalties
imposed on your business by regulatory andjudicial institutions in the year available in publicdomain.
Provide examples (up to three) of corrective
action taken on the above fines/penalties
imposed.
Provide examples (up to three) of corrective
action taken on the complaints / cases ofcorruption and conflicts of interest to prevent
recurrence.

PRINCIPLE 2
1.
2.
3.

4.

5.

Essential Indicators
List top three goods /services (revenue in the1.
year) which incorporate environmental and social
concerns, risks, and/or opportunities in their design.
Details of investments in specific technologies toimprove the environmental and social impacts (topthree by value).
% of input material and services (by value), in theyear, sourced from suppliers adhering to internal orexternal sustainability standards / codes / policies /labels.
% of total raw material consumed in the year (by2.
value) that consisted of material that was recycled orreused (provide details in 50 words):
a. <5%
b. between 5% and 25%,c. > 25%.
3.
Describe the process in place to safely collect,reuse, recycle and dispose of your products at end-oflife (100 words)

Leadership Indicators
For goods and services that incorporated
environmental and social concerns, give details of:a. Resource use (energy, water, raw material)
per unit produced in the year.
b. Reduction in resource use covering
sourcing, production, and distribution in
the year.
c. Sustainability standards/codes/ labels
adhered to.
d. Product life cycle assessment completed.
Information on the impacts of your products acrossthe value chain communicated to:a. To which stakeholder groups?
b. By which channels for each group?
c. At what frequency?
Provide examples (up to three) on how the
feedback received from stakeholders is used for
improvements?

National Guidelines on Responsible Business Conduct

41

PRINCIPLE 3
Essential Indicators
1. Complaints received on cases arising out of
discrimination:a. Number received in the year
2. Number of the above complaints pending
resolution at end of the ear?
3. % of permanent employees who are membersof the employee association(s) recognized by
the management?
4. % of your establishments / value chain thathas been audited in the year for:a. Child labourb. Forced/involuntary labour
5. Number of cases of child labour in yourestablishments/ value chains identified to date:a. Resolved
b. Pending resolution
6. Number of cases of forced / involuntarylabour identified to date:a. Resolved
b. Pending resolution
7. % of your employees that were paid above thelegal minimum wage in the last year?
8. Ratio of the highest salary paid to thelowest salary paid amongst your permanent
employees?
9. Number of cases of delay in payment ofwages during the year:
a. Resolved
b. Pending resolution
10. Number of complaints related to harassment
to date:a. Resolved
b. Pending resolution
11. Number of the following occurred during theyear:
a. Accidents at the workplaceb. Fatalities causedc. Disability caused
12. % of employees (all categories) trained onhealth and safety issues and measures:a. In the year
b. Total to date
13. % of employees provided training and skill
upgradation:a. In the year
b. Total to date

42

Leadership Indicators
1. Categories of employees (list up to three)supported by affirmative action, and has there
been any change from the previous year?
2. % of non-permanent employees that arelinked to any standing platform/association
3. % of children identified as employed in yourestablishments / value chain that have been
remediated:
a. In reporting year
b. Total to date
4. % of forced/involuntary labour identified inyour establishments / supply remediated:
a. In reporting year
b. Total to date
5. % of your suppliers (by value) that paid
minimum wages to their employees last year
6. Examples of steps taken (up to three)
to prevent adverse consequences to thecomplainant in the case of harassment cases.
7. % of supply chain partners (by value) thatwere assessed for adherence to health andsafety practices.
8. % of accident-affected persons integrated
back into employment.
9. Describe the work-life balance issues (up to
three) that were brought up by employees (100words).
10. Examples (up to three) of identified work-lifebalance topics that have been implemented.

National Guidelines on Responsible Business Conduct

PRINCIPLE 4
Essential Indicators
1. List stakeholder groups that have been
identified as key to your business?
2. Positions / departments / functions
responsible for engagement with eachstakeholder category identified above?
3. Number of stakeholder groups that wereformally engaged on environment and social
issues in the last year?
4. % of input material and services (by value),in the year, that were procured from local andsmall vendors / producers?

Leadership Indicators
1. Frequency of engagement with eachstakeholder group?
2. Examples (up to three) of how the business has
incorporated inputs from stakeholders.
3. List of the vulnerable and marginalizedgroups in each stakeholder group.
4. Examples of decisions and actions takenby the business to address the interests ofvulnerable/marginalized groups.

PRINCIPLE 5
Essential Indicators
1. % of employees that have been provided
training on human rights issues:a. In the year
b. Total to date
2. Employee categories that are covered by
the human rights policies of the business –Permanent/Contract/Casual.
3. Number of business agreements andcontracts with third party partners that werereviewed in the year, to avoid complicity withadverse human rights impacts in the previous
year.
4. Stakeholders groups governed by thegrievance committee for human rights issues.
5. Number of stakeholders that reported
human rights related grievances and/or
complaints:
a. Received in the year
b. Pending resolution

Leadership Indicators
1. % of contractual employees and value
chain partners that have been made aware /provided training on human rights issues:a. In the year
b. Total to date
2. External stakeholder groups andrepresentatives that are covered by the humanrights policies of the business?
3. Stakeholder groups that have been madeaware of the grievance mechanisms forhuman rights issues:a. During the year
b. Total to date
4. List (up to three) corrective actions taken toeliminate complicity with adverse human rights
impacts in the last year.
5. Provide (up to two) examples of a businessprocess being modified / introduced as aresult of addressing human rights grievances/complaints.
6. Provide details of the scope and coverage ofany human rights due-diligence conductedduring the year.

National Guidelines on Responsible Business Conduct

43

PRINCIPLE 6
Essential Indicators
1. Material risks of potential or actual adverse 1.
impacts upon the environment andcommunities by the business:a. Identified in the year
b. Mitigation and adaptation measures put inplace for the above environmental risks?
2. Good practices (up to three) in reduction, 2.
recycling, and reuse initiatives that contributed
to lowering the adverse environmental footprintof your business activities.
3. Examples of any collective action by yourbusiness with other businesses / NGOs / 3.
government agencies / international partners /development institutions undertaken to address
any of the environmental risks opportunities 4.
identified above.
4. Details of any adverse orders in respect of any
show cause / legal notices from CPCB/NGT/SPCB
received during the year.
5.
PRINCIPLE 7
1.

2.
3.
4.

Essential Indicators
Review public policy advocacy positions by
1.
the governance structure for consistency with
Principles of these Guidelines:
2.
a. Frequency
b. Month/year of last review.
Names of trade and industry chambers and3.
associations that you are a member/affiliate of.
Details of any adverse orders received from
regulatory authorities for anti-competitive
conduct by your business.
Monetary contributions (if any) that have been
made to political parties.

44

Leadership Indicators
Information on environmental impact
assessments undertaken in the year:
a. Have the results been communicated in the
public domain?
b. Provide details of any actions taken to
mitigate any negative social impacts.
Risk management strategies and measures foreach material environmental risk identified forthe business:a. Details of measures (100 words).
b. Targets and achievement values.
Details of your specific contribution to
India’s Nationally Determined Contributions(submitted at UNFCCC COP21 in 2015)
New businesses-products-services createdto address the material environmental risks
identified:a. Information on businesses created (100words)
b. % of revenue contributed by these
Details of good practices cited in reduction,
recycling, and reuse initiatives benchmarked
against industry best practice (100 words).
Leadership Indicators
The public policy positions available in the
public domain.
Examples (up to three) of any policy changes
in the past year as a result of your advocacy
efforts.
Details of corrective action for anticompetitive conduct, taken by the businessbased on adverse orders from regulatory
authorities.

National Guidelines on Responsible Business Conduct

PRINCIPLE 8
1.

2.

3.

4.

5.
6.
7.
8.

Essential Indicators
Social impact assessments of your business
1.
operations conducted:
a. Number completed in the year?
b. Number conducted by an independent external
agency.
2.
Examples of products, technologies, processesor programmes (up to three) that contribute to3.
the benefit of the vulnerable and marginalized
sections of societyWith respect to projects during the year for which
R&R is applicable:
a. Number of persons that were affected displacedby these projects?
4.
b. Gross amount paid out to project-affected anddisplaced persons?
Grievances / complaints received from local
5.
community:
a. Number received during the year
b. Number pending resolution
6.
Details of investments (top three by value) in regions
which are underdeveloped (100 words).
Examples of goods and services up to 3) that
7.
incorporate local traditional knowledge.
Details of adverse orders or judgments in
intellectual property rights disputes related to
traditional knowledge during the year (100 words). 8.
Summary of the key themes covered by CSR
initiatives (as per Section 135 of Companies Act 2013)
or linked to the CSR Policy of the business (up to 100
words).

Leadership Indicators
With respect to these social impact assessments:
a. Results made available in the public domainb. Details of any actions taken to mitigate any
negative social impacts (100 words).
Numbers benefitting from such beneficial products,
technologies or processes.
With respect to projects during the year for which
R&R is applicable:
a. Was the R&R package developed in consultation
with project-affected people?
b. Information on gross amounts, maid available in
the public domain
Channels/platforms used to communicate
information regarding resolution of grievances /complaints from communities.
Examples (up to three) of economic and social value
addition in these underdeveloped regions (100words).
Examples where benefits of this local traditional
knowledge being used by the business are sharedwith the community.
Number of beneficiaries covered under your CSR
projects (as per Section 135 of Companies Act 2013),
disaggregated by the vulnerable and marginalizedgroup categories.
Examples of how the impact of your community
initiatives contribute to local and national
development indicators?

PRINCIPLE 9
1.
2.

3.

4.

5.

Essential Indicators
1.
Examples (up to three) where adverse impacts ofgoods and services of your business have been raisedin public domain.
% by value of goods and services of the business thatcarry information about:2.
a. Environmental and social parameters relevant to3.
the product.
b. Safe and responsible usage.
Number of consumer complaints in respect of data 4.
privacy:a. Received during the year.
b. Pending resolution.
5.
Number of consumer complaints in respect ofadvertising:a. Received during the year.
b. Pending resolution.
6.
Number of consumer complaints in respect ofdelivery of essential services:a. Received during the year.
b. Pending resolution.

Leadership Indicators
Corrective actions taken on adverse impacts ofgoods and services of your business:a. Details (100 words).
b. Communicated in the public domain.
List of national-international product labels /certifications being used by the business.
Channels platforms where information on goods
and services of the business can be accessed.
Steps taken to inform and educate vulnerable
and marginalized consumers about safe andresponsible usage of products (100 words).
On complaints received in respect of data privacy
and advertising, indicate what corrective actions
were taken to ensure that these do not get repeated(100 words).
Processes in place to inform consumers of any risk of
disruption/discontinuation of essential services (100words).

Signature of the designated official responsible for this report.
Sd/Name:						Designation:
Address:
Telephone number:
Email id:-----------------

National Guidelines on Responsible Business Conduct

45

Annexure 4:
SDGs Mapped Against NGRBC

The chart demonstrates the alignment between the SDGs and relevant Principles of the NGRBC. It may be
noted that this is indicative.

46

National Guidelines on Responsible Business Conduct

Annexure 5:
Business Case Matrix

The Business Case Matrix (BCM) is designed as a tool to map the business benefits of integrating these
Guidelines. The BCM here highlights some significant benefits which may accrue to businesses from integrating
the Principles from these Guidelines. This is not exhaustive and it is critical for each business to assess thebenefits in their respective contexts.
Principle

Revenue
growth andmarket access1.

Integrity,
New customers;
Ethics,Business partnertransparency, of choiceaccountability

2.

Safe andsustainable
goods andservices

3.

Well-being of
employees

4.

Respect andresponsiveness to all
stakeholders

New customers;
Customer loyalty

5.

Respect andpromoteHuman rights

6.

Respect,
protect andrestore theEnvironment

Access tointernational
capital anddeveloped
country markets
Business partnerof choice,especially forsustainabilityoriented buyers

7.

Responsible
andtransparent
policyadvocacy
Promoteinclusive
growth andequitable
development

8.

9.

New customers;
Customer loyalty

Potential
for market
expansion andacquisition of
new customers

Provide value New customers;
to consumer Customer loyalty
responsibly

Riskmanagement/
license tooperateGood governance Positively seenpractices areby communities,
attractive toNGOs, local
investors, banks, governments,
financial markets regulators
Reduced risk
Efficiency gains in Lower risk
supply chain and perception isof action fromproduction
attractive toregulators
investors andand consumer
lenders
activists
Increased
Improved labour
productivity; highrelations leading
morale; reduced
to less disruptions
absenteeism
Efficiency
Good governance Positively seenby stakeholders
practices are
gains acrossattractive to- communities,
procurement,
production
investors andNGOs,governments,
distribution, after- banks
regulatorssales
Enhanced
Good governance Positively seen
by communities
productivity
practices are
attractive to
and NGOs; Lower
investors, banks, risk of nonfinancial markets compliance
Lower operating Lower risk
Positively seen
costs in the long perception isby communities,
term; less danger attractive toNGOs,of“externalities”
investors, banks, governments,
emerging as
financial markets regulators; Lower
liabilities.
risk of noncompliancePositively seenby governments,
regulators, NGOs
Cost savings andAccess to capital
productivity

Lower costs ofLower risk
ensuring business perception iscontinuity
attractive toinvestors andlenders

Enhancedgovernmental
support toinitiatives;
improved
relations with
communities
Growth prospects Lower risk of
attractive toconsumer action
investors

Human capital
Attract andretain quality
employees
Attract andretain quality
employees

Brandvalue/
reputation
Positively
seen bycustomers,
regulators,
media
Enhancedbrand value

Attract andretain quality
employees

Employer ofchoiceAttract andretain quality
employees

Positively
seen bycustomers,
regulators,
media

Attract andretain quality
employees

Positively
seen bycustomers,
regulators,
media
Positively
seen bycustomers,
regulators,
media

Attract andretain quality
employees

Potential sourceof trained
employees

Talent will bedrawn towards
growing firm

National Guidelines on Responsible Business Conduct

Positively
seen bycustomers,
regulators,
media
Positively
seen bycustomers,
regulators,
media
Customers
perceive
brand
and firm
favourably47Annexure 6:
Guidance for Businesses on Using
the BRRF as a Self-Assessment
Tool

The Business Responsibility Reporting Framework (BRRF) is a tool for businesses to assess how well-aligned
they are to the National Guidelines for Responsible Business Conduct (NGRBC), and identify opportunities for
improvement. This note provides guidance on how this can be done.
To begin with, it must be understood that there are two dimensions to alignment. The first may be referred toas “completeness”, which measures the extent to which the Principles and Core Elements are tracked by thebusiness. The second, which may be referred to as “Ambition”, measures how evolved and challenging theperformance targets that the business sets for itself are, and what to extent these are achieved.
Given the stage of evolution of the NGRBC, this tool focuses on the Completeness aspect of alignment.
Completing the BRRF
Each business must attempt to complete all the three sections of the BRRF. Sections A and B have indicatorsthat all businesses are expected to complete. Section C has indicators divided into two categories – Essential
Indicators and Leadership Indicators – the latter being those indicators, that companies which are morefamiliar and experienced in business responsibility and sustainability should be able to complete.
Once the business has completed this, it must identify all the specific questions and indicators that it has notbeen able to complete. This forms the basis for it to determine where it is in terms of completeness.
Assessing Completeness
The following grid can assist companies in knowing what is the level of completeness, High being the highest
level of completeness and, Other, being the lowest. Businesses may choose to rate themselves against Section B
on each of the Principles.

Section/Subsection
Section B

High (20)Medium (15)Low (10)

Other (5)All complete

Qs 1, 5, 7, 8 andten of the others
complete

Q 1 and five ofothers complete

Section C –Principles 1 to 9

All complete

OverallAbove 180

All Essential andsome Leadershipcomplete
150 – 180

Q 1 complete, Q
5 OR 7 OR Q 8
and seven of theothers complete
All Essential
complete
120 – 180

Below 120

Some but not all
Essential complete

Businesses that wish to arrive at an overall score can do this by assigning scores to the level of completenessagainst each of the sections and sub-sections. As an example, scores for each of the completeness levels range
from 20 for, High, and 5 for, Other, (and businesses are free to choose whatever score they want). Businesses
that wish to arrive at an overall score can do this by adding the score for each of Section B and the 9 Principles
of Section C. It is advisable to give equal weightages for each Principle since, as was stated earlier, all theprinciples are inter-dependent, inter-related and non-divisible.

48

National Guidelines on Responsible Business Conduct

Annexure 7:
Indian Laws and Principles(Indicative)

This annexure is only an indicative/suggestive mapping of each of the Principles against laws enacted in India.
Principles(briefs)
List of Laws(indicative)

Principle 1
Integrity,
Ethics,Transparency&
Accountability

Factories Act,1948√

Companies Act,2013√

Bureau of Indian Standards
Act, 2016
Prevention of Corruption Act,
1988

Principle 2
Safe and
Sustainable
goods andservices

Principle 3
Well– beingof
Employees

Principle 4
Respect for andresponsivenessto allstakeholders√

Principle 5
Respect andPromoteHuman Rights

√
√

√

√

Prevention of Money
Laundering Act,2002
Right to Information Act,
2005
Micro, Small and Medium
Enterprises Development
Act, 2006
The Lokpal and Lokayuktas
Act, 2013
Industrial Disputes Act,1947

√
√
√

√
√

√

√
√

√

√

√

√
√

√

√
√

√

√

√
√

√
√

√

Trade Union Act, 1956

√

√

√

√

Plantations Labour Act, 1951

√

√

√

Equal Remuneration Act,
1976
Consumer Protection Act,
1986
National
Commission for Backward
Classes Act, 2017
Persons with Disabilities(Equal Opportunities,
Protection of Rights and Full
Participation)Act,1995
Juvenile Justice (Care andProtection of Children) Act,
2000
National Commission for
Minority Educational
Institutions Act, 2004
Commissions for Protection ofChild Rights Act,2005
National Rural Employment
Guarantee Act, 2005
Protection of Women from
Domestic Violence Act,2005
The Scheduled Tribes andOther Traditional Forest
Dwellers (Recognition ofForest Rights)Act,2006
Protection of Human Rights(Amendment)Act,2006

Principle 9
Provide value
to consumer
responsibly√√

Designs Act,2000

Principle 8
Promoteinclusive
growth andequitable
development√

Patents Act, 1970
Competition Act, 2002

Principle 7
Responsible
andtransparent
policyadvocacy√√

Trade Marks Act, 1999

Principle 6
Respect,
protect andrestore theEnvironment

√

√

√

√
√

√

√

√

√

√

√

√

√

√

√

√

√

√

√
√

√

√

√

√

√
√

√

√

√

√

√

√

√

√

√

√

National Guidelines on Responsible Business Conduct49

Principles(briefs)
List of Laws(indicative)

Principle 1
Integrity,
Ethics,Transparency&
Accountability

Principle 2
Safe and
Sustainable
goods andservices√√

Right to Fair Compensation
and Transparency in Land
Acquisition, Rehabilitation andResettlement Act, 2013
The Scheduled Castes And The
Scheduled Tribes (Prevention
Of Atrocities) Act, 1989
The Protection Of Women
Against Sexual Harassment At
Work Place Bill, 2010
Environment(Protection)
Act, 1986
Public Liability Insurance Act,
1991

Principle 3
Well– beingof
Employees√√

Principle 4
Respect for andresponsivenessto allstakeholders

Principle 5
Respect andPromoteHuman Rights

Principle 6
Respect,
protect andrestore theEnvironment

Principle 7
Responsible
andtransparent
policyadvocacy

Principle 8
Promoteinclusive
growth andequitable
development

√

√

√

√

√

√

√

√

√

√
√

√

√
√

Biological Diversity Act 2002
Hazardous and Other
Wastes (Management andTransboundary Movement)
Rules, 2016
E-waste (Management), Rules,
2016
Laws in ‘Section A’ (Labour
Laws)
Laws in ‘Section B’(Environmental Laws)
Laws in ‘Section C’ (Economic/
Finance Laws)

Principle 9
Provide value
to consumer
responsibly

√

√

√

√

√

√

√

√

√

√

√

√

√

√

√
√

√
√

√
√

‘Section A’‘Section B’

Workmen’s Compensation Act, 1923

Wildlife Protection Act, 1972

Children (Pledging of Labour) Act, 1933

Water (Prevention and Control of Pollution)
Act, 1974

Payment of Wages Act,1936

Water (Prevention and Control of Pollution)
Cess Act, 1977

Industrial Employment (Standing Orders) Act, 1946

Air (Prevention and Control of Pollution)
Act, 1981

Employees State Insurance Act, 1948

Forest (Conservation) Act, 1980–
Amendments in 1988

Minimum Wages Act, 1948

National Environment Tribunal Act, 1995

Employees Provident Fund and Miscellaneous Provisions Act, 1952

National Environmental Appellate
Authority Act, 1997

Maternity Benefits Act, 1961

Energy Conservation Act, 2001

Payment of Bonus Act, 1965

Coastal Aquaculture Authority Act, 2005

Contract Labour (Regulation & Abolition) Act, 1970

Special Economic Zones Act, 2005

Payment of Gratuity Act,1972
Bonded Labour System (Abolition) Act, 1976
Inter-State Migrant Workmen (Regulation of Employment andConditions of Service) Act,1979
Child Labour (Prohibition & Regulation) Act, 1986
Building and Other Construction Workers (Regulation of Employment and Conditions of Service)
Act,1996
Vishaka State of Rajasthan, (1997) 6SCC241‘Section C’
Essential Commodities Act, 1955
Union Duties of Excise (Distribution) Act, 1979
Central Excise Tariff Act, 1985
Customs (Amendment) Act, 1985
Taxation Laws (Amendment and Miscellaneous Provisions) Act, 1986
Direct Tax Laws (Amendment) Act, 1988
Foreign Trade (Development and Regulation) Act, 1992
Securities and Exchange Board of India Act, 1992
Customs and Central Excise Laws (Repeal) Act, 2004
National Tax Tribunal Act, 200550

National Guidelines on Responsible Business Conduct

Annexure 8:

Resources

National Resources
1. A Guidebook for Biodiversity Management – IBBI and CII-ITC CESD
Insights on biodiversity and its links with businesses across seven major sectors.
(http://www.sustainabledevelopment.in/uploads/pdf/1469421072IBBI%20BOOKLET%20FOR%20
WEB.pdf )2. Affirmative Action for Scheduled Castes & Scheduled Tribes: A CII-ASSOCHAM Action Plan
Proposed concrete steps by Indian industry on affirmative action.
(http://www.cii.in/PolicyAdvocacyDetails.aspx?enc=IFXLRvnZcDACwloqWArEXIcvuANvzgDxEEJSWHB7rz5wGOZZgeDEwFRE76lKC5mfH1eO+UwMGUryNJwTMQk1Bg)
3. Aggregate Reports – Samples from Ajmer and Punjab clusters(http://database.globalreporting.org/reports/view/35253 | http://database.globalreporting.org/
reports/view/35252)
4. Constitution of India(https://india.gov.in/my-government/constitution-india/constitution-india-full-text)
5. Corporate Governance in India @ 2016: Where Do We Stand - FICCI
A report on the state of corporate governance in India post introduction of Companies Act, 2013(http://ficci.in/spdocument/20739/Corporate-Governance-report-2016.pdf )6. Guidelines on Corporate Governance for Central Public Sector Enterprises
Issued by the Ministry of Heavy Industries and Public Enterprises in May 2010(http://dpe.nic.in/sites/upload_files/dpe/files/gcgcpse10.pdf )7. Inclusiveness and Accessibility Index - FICCI
A Toolkit to promote Inclusiveness of Persons with Disabilities.
(http://ficci.in/publication-page.asp?spid=20718)
8. Indian Companies with Solutions that the World Needs: Sustainability as a Driver for Innovation andProfit - WWF & CII-ITC CESD
Report focusing on climate change and how businesses develop strategic responses.
(http://sustainabledevelopment.in/uploads/pdf/1445612272Indian_Companies_With_Solutions_That_the_World_Needs.pdf )9. India’s Nationally Determined Contribution
Intended contribution of India towards the international climate agreement signed at the UNFCCC Conference of the Parties (COP21) in Paris in December 2015.
(http://www4.unfccc.int/submissions/INDC/Published%20Documents/India/1/INDIA%20INDC%20
TO%20UNFCCC.pdf )10. IS 16010: Guidance on Good Governance by Bureau of Indian Standards
Standard specifies principles and governance structures for a value based management approach.
(https://bis.gov.in/other/writeuponGG%20.pdf )11. National Action Plan on Climate Change
NAPCC, under the Prime Minister’s Council on Climate Change, brings together the existing national planson water, renewable energy, agriculture and others into a set of eight missions.
(http://www.moef.nic.in/sites/default/files/Pg01-52_2.pdf )12. Scaling Up Sustainable Development Of MSME Clusters In India: Learning Document(https://www.globalreporting.org/SiteCollectionDocuments/LearningDocument_SAI.pdf )13. Stakeholder Engagement: Good Practice Handbook - IFC
Overview of good practices in stakeholder engagement, with a focus on groups that are “external” to thecore operation of the business.
(http://www.ifc.org/wps/wcm/connect/938f1a0048855805beacfe6a6515bb18/IFC_StakeholderEngagement.pdf?MOD=AJPERES)

National Guidelines on Responsible Business Conduct51

14. The Companies Act, 2013
Base regulation for incorporation of a company in India including responsibilities of the Board, and, Section
135 on corporate social responsibility mandated for companies.
(www.mca.gov.in/Ministry/pdf/CompaniesAct2013.pdf )15. The Micro, Small and Medium Enterprises Development Act, 2006
Base regulation for promotion and development of MSMEs in India.
(http://msme.gov.in/WriteReadData/DocumentFile/MSMED2006.pdf )International Resources
1.

Beyond Supply Chains - Empowering Responsible Value Chains - World Economic Forum
Report on the case for and issues within sustainable supply chains of businesses(http://www3.weforum.org/docs/WEFUSA_BeyondSupplyChains_Report2015.pdf

2.

Children’s Rights and Business Principles
Guidance on how businesses can take action to respect and support children’s rights(https://www.unglobalcompact.org/docs/issues_doc/human_rights/CRBP/Childrens_Rights_and_Business_Principles.pdf )3.

Convention on the Elimination of all Forms of Discrimination Against Women (CEDAW)UN International Treaty bill of rights for women(http://www.un.org/womenwatch/daw/cedaw/)

4.

Corporate Responsibility: Private Initiatives and Public Goals by OECD
Analysis of the results of an OECD fact-finding project on business approaches tocorporate
responsibility(https://www.oecd.org/daf/inv/corporateresponsibility/35315900.pdf

5.

Developing Value by Sustainability and IFC
Report on identifying opportunities to increase profits by making progress on sustainability.
(http://www.ifc.org/wps/wcm/connect/84a59480488559ca842cd66a6515bb18/Developing_
Value_full.pdf?MOD=AJPERES)

6.

ISO 26000: International Standard
Guidance on how businesses and organizations can operate in a socially responsible way.
(http://www.iso.org/iso/home/standards/iso26000.htm)

7.

Forging a path for business in the UN 2030 development agenda
Resources for businesses to map their initiatives within the UN 2030 development agenda including
the SDGs.
(http://www.businessfor2030.org/)

8.

Global Reporting Initiative (GRI) Standards
Guidance for businesses to prepare and publish sustainability reports as per the GRI Standards.
https://www.globalreporting.org/standards/

9.

Linking the GRI Standard and the SEBI BRR Framework
https://www.globalreporting.org/standards/resource-download-center/linking-the-gristandards-and-the-sebi-brr-framework/

10. ILO Declaration on Fundamental Principles and Rights at Work
Declaration commits Member States to respect and promote principles and rights in four categories(https://www.ilo.org/declaration/lang--en/index.htm)
11. International Covenants on Civil and Political Rights and Economic, Social and Cultural Rights
Multilateral treaty adopted by the UN, committing its parties to work toward the granting of
economic, social, and cultural rights.
(http://www.ohchr.org/EN/ProfessionalInterest/Pages/CESCR.aspx)

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National Guidelines on Responsible Business Conduct

12. International Integrated Reporting Council (IIRC) Guidelines
Guidance for businesses to prepare and publish an Integrated Report as per the IIRC framework.
(http://integratedreporting.org/wp-content/uploads/2013/12/13-12-08-THE-INTERNATIONAL-IRFRAMEWORK-2-1.pdf )13. Natural Capital Protocol and Sector Guides - Natural Capital Protocol
Draft framework to help inform and support business decisions by including their impact on naturalenvironment.
(http://naturalcapitalcoalition.org/protocol/development/)
14. OECD Guidelines for Multinational Enterprises
Guidelines on recommendations addressed by governments to multinational enterprises forresponsible business conduct(http://www.oecd.org/investment/mne/1922428.pdf )15. Public Sector Roles in Strengthening Corporate Social Responsibility - World Bank
Report on roles that public sector agencies have played in providing an enabling environment for
CSR.
(http://siteresources.worldbank.org/INTPSD/Resources/CSR/Taking_Stock.pdf )16. Social Capital Protocol - WBCSD
A collation of tools for businesses to measure and value their interactions with people and society.
(http://www.wbcsd.org/SocialCapital.aspx)
17. Strengthening Implementation of Corporate Social Responsibility in Supply Chains – IFC
A World Bank commissioned study on barriers to the achievement of better sustainability
performance in suppliers(http://siteresources.worldbank.org/INTPSD/Resources/CSR/Strengthening_Implementatio.pdf )18. Towards Responsible Lobbying: Leadership and Public Policy - Accountability and UNGC
A study to understand how organizations influence goals of sustainable development throughlobbying processes(https://www.unglobalcompact.org/docs/news_events/8.1/rl_final.pdf )19. UN Guiding Principles on Business and Human Rights
Implementing the United Nations “Respect, Protect and Remedy” Framework(https://www.ohchr.org/Documents/Publications/GuidingPrinciplesBusinessHR_EN.pdf )20. UN Guidelines on Consumer Protection
A set of principles for setting out the main characteristics of effective consumer protection legislation,
enforcement institutions and redress systems(http://unctad.org/en/Pages/DITC/CompetitionLaw/UN-Guidelines-on-Consumer-Protection.
aspx)
21. UN Guiding Principles Reporting Framework
Guidance for businesses to report on how they respect human rights(https://www.ungpreporting.org/wp-content/uploads/UNGPReportingFramework_2017.pdf )22. Universal Declaration of Human Rights
Adopted by the UN General Assembly as a common standard of achievement for all peoples and allnations.
(http://www.un.org/en/universal-declaration-human-rights/)
23. UN Sustainable Development Goals
17 goals with 169 targets adopted by the UN as part of its sustainable development agenda andreplacing the erstwhile Millennium Development Goals.
(http://www.un.org/sustainabledevelopment/sustainable-development-goals/)National Guidelines on Responsible Business Conduct

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MINISTRY OF CORPORATE AFFAIRS
Address:“A” Wing Shastri Bhawan, Rajendra Prasad Road,New Delhi-110001

www.mca.gov.in

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