The Securities and Exchange Board of India (SEBI) has the framework for environmental, social and governance (ESG) debt securities covering social, sustainability and sustainability-linked bonds listed or proposed for listing on stock exchanges.
The framework’s requirements and regulations are in addition to the SEBI (Issue and Listing of Non-Convertible Securities) Regulations, 2011, and SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015.
ESG debt securities in the country are defined as bonds issued to raise funds used for financing projects or assets aligned with the established standards of the:
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- International Capital Market Association’s principles/guidelines;
- Climate bonds standards;
- Asean standards;
- European Union standards; and
- Any framework or methodology specified by any financial sector regulator in India.
The issuer has the responsibility of categorising an ESG debt security as a social bond, sustainability bond or a sustainability-linked bond. Specific listing and disclosure requirements are outlined for the issuer of these bonds.
Under the framework, an issuer is responsible for determining the eligibility of projects and assets. Issuers must also ensure these bonds meet the required objectives, proceeds are only used for the purpose stated in the offer document and there is no purpose-washing. Purpose-washing refers to actions such as using funds for other purposes not stated in the offer document or using misleading labels.
The framework took effect on 5 June 2025.
