The short answer
The difference between an ESG report and a sustainability report lies less in the data and more in the promise made to the reader. An ESG report typically focuses on how environmental, social and governance factors influence business risks, opportunities and enterprise value. A sustainability report takes a broader view, explaining how a company affects the economy, the environment and people.
For Indian listed companies, BRSR remains the prescribed reporting requirement for the top 1,000 listed entities. The decision to publish a separate ESG or sustainability report is therefore about audience, reporting objectives and the level of detail required beyond regulatory disclosures.
The key question is not simply which title to use. It is whether the report’s content, evidence and metrics support the expectations that title creates.
Why has the report title become a strategic decision?
The terminology used in sustainability reporting is changing. According to Teneo’s review of 250 S&P 500 reports published in 2026, only 4% used “ESG” in their report titles, compared with 35% in 2022.
However, the shift in terminology does not mean that companies have abandoned reporting. The same review found that 87% of companies that published reports in the previous year published again, while approximately three-quarters obtained external assurance on their data.
The distinction is important: the language used to describe reporting may change even when the underlying reporting continues.
A report title sets expectations before readers examine its contents. It signals the intended audience, the materiality perspective and the type of evidence the company is prepared to provide. A mismatch between the title and the report’s contents can create confusion and weaken credibility.
For Indian companies, this decision also needs to reflect the country’s reporting requirements, investor expectations and growing scrutiny of environmental claims.
What is the difference between an ESG report and a sustainability report?
The distinction can be understood through three factors: origin, materiality and audience.
1. Origin
Sustainability reporting developed from the broader movement towards corporate accountability for impacts on people, the environment and the economy. The Global Reporting Initiative (GRI), whose first guidelines were published in 2000, has played a significant role in developing standards for impact-focused reporting.
The term ESG gained prominence in capital markets through the United Nations Global Compact’s 2004 Who Cares Wins report, which explored how environmental, social and governance factors could be incorporated into investment analysis.
These traditions overlap, but their original emphasis differs: sustainability reporting focuses on organisational impacts, while ESG analysis is closely associated with evaluating sustainability-related risks and opportunities for investment decisions.
2. Materiality
Materiality is one of the most important distinctions.
- Impact materiality: Commonly associated with GRI reporting, it considers an organisation’s significant impact on the economy, environment and people.
- Financial materiality: Central to the investor-focused approach reflected in IFRS S1, it considers sustainability-related risks and opportunities that could affect a company’s prospects, including cash flow, access to finance and cost of capital.
- Double materiality: Used in the European Union’s sustainability reporting framework, it considers both the organisation’s impact and the financial implications of sustainability matters.
The title should reflect the reporting approach actually used. A company should not imply that it has assessed financial risks or wider stakeholder impacts unless its process and disclosures support that claim.
3. Audience
A sustainability report generally serves a broad group of stakeholders, including employees, customers, communities, civil society and business partners.
An investor-focused ESG report is more likely to serve investors, lenders, analysts and ESG rating providers who need comparable data to assess performance, risks and opportunities.
In practice, many reports serve both groups. The title indicates the report’s primary emphasis rather than defining an absolute boundary.
ESG report vs sustainability report: a quick comparison
| Area | ESG report | Sustainability report |
| Core question | How do sustainability factors affect business risks, opportunities and enterprise value? | How does the business affect the economy, environment and people? |
| Typical materiality lens | Financial materiality | Impact materiality |
| Primary audience | Investors, lenders, analysts and ESG rating providers | Employees, customers, communities, civil society and business partners |
| Common reference points | ISSB standards, SASB Standards and climate-related financial disclosures | GRI Standards and relevant sustainability frameworks |
| Typical presentation | Structured, data-intensive and focused on comparability | Narrative-led, supported by metrics, case studies and stakeholder perspectives |
| Key risk if poorly prepared | Data may not meet expectations for comparability and decision-usefulness | Claims may lack context, evidence or a clear account of impacts |
| Intended value | Supports assessment of sustainability-related financial risks and opportunities | Explains impacts, performance and the organisation’s sustainability approach |
These are typical distinctions, not rigid rules. Strong reporting often combines quantitative ESG indicators with a broader explanation of strategy, impacts and performance.
Does Indian regulation require an ESG report or a sustainability report?
India’s prescribed reporting instrument for the top 1,000 listed entities is the Business Responsibility and Sustainability Report (BRSR) under Regulation 34(2)(f) of the SEBI Listing Obligations and Disclosure Requirements Regulations. It is included in the annual report.
A separate document titled “ESG Report” or “Sustainability Report” is not, in itself, the prescribed requirement for these entities. However, companies may publish additional disclosures to address investor expectations, explain their sustainability strategy and respond to the information needs of other stakeholders.
BRSR provides a foundation for wider reporting
SEBI’s 2021 BRSR framework allows companies reporting under internationally accepted frameworks, including GRI, Integrated Reporting and TCFD, to cross-reference relevant disclosures in their BRSR, subject to the applicable provisions.
This creates scope for companies to build on their prescribed disclosures rather than repeat the same information across multiple publications. The challenge is to maintain consistent figures, reporting boundaries and explanations.
ESG ratings make comparable data important
India has a regulatory framework for ESG rating providers under the SEBI (Credit Rating Agencies) Regulations, 1999. ESG ratings and related assessment processes make the quality, consistency and traceability of disclosed information important for companies seeking to understand how their performance is evaluated.
An investor-focused ESG publication should therefore provide clear definitions, comparable multi-year metrics and evidence supporting reported performance.
Greenwashing rules increase the importance of evidence
The Central Consumer Protection Authority’s Guidelines for Prevention and Regulation of Greenwashing or Misleading Environmental Claims were notified on 15 October 2024.
These guidelines are relevant when environmental claims are communicated to consumers. Although a sustainability report is not automatically an advertisement, claims taken from it and used in marketing materials, websites, product communications or tender submissions may require particular scrutiny.
Companies should ensure that environmental and social claims are specific, substantiated and consistent across communication channels. A central claims register, maintained jointly by sustainability and communications teams, can help support this process.
What are Indian companies publishing?
KPMG in India’s February 2026 analysis of 94 NIFTY 100 companies for FY 2024–25 reported the following:
- 50 companies presented BRSR and wider sustainability disclosures within the annual report, either in a dedicated section or through an integrated format.
- 44 companies published a separate sustainability or ESG report in addition to BRSR.
- 57 companies obtained voluntary third-party assurance beyond mandatory BRSR Core requirements; 36 opted for limited assurance.
The findings indicate that companies use different reporting formats depending on their requirements and communication objectives. There is no single publication format that fits every organisation.
How are global reporting practices evolving?
United States: terminology is changing
Teneo’s 2026 review found that “ESG” appeared in only 4% of S&P 500 report titles, down from 35% in 2022. Yet 87% of companies that had reported in the previous year continued to publish.
This suggests a shift in terminology rather than a comparable decline in reporting activity. Companies should assess their own audiences and reporting objectives instead of adopting a label simply because it is gaining or losing popularity in another market.
European Union: sustainability reporting has a formal regulatory role
The EU’s Corporate Sustainability Reporting Directive (CSRD) and European Sustainability Reporting Standards (ESRS) use the language of sustainability reporting. The EU’s double materiality approach considers both organisational impacts and financial implications.
The EU has also developed a voluntary sustainability reporting approach for companies outside the mandatory reporting scope. This is relevant to Indian suppliers that may receive sustainability-data requests from European customers.
Companies serving European markets should monitor applicable requirements and customer expectations before deciding how to structure their disclosures.
ISSB: sustainability-related financial disclosures
The International Sustainability Standards Board’s IFRS S1 and IFRS S2 standards focus on sustainability-related financial disclosures, including climate-related information. Their approach is designed to provide investors with decision-useful information about sustainability-related risks and opportunities.
This illustrates why companies should distinguish between the term used on a report cover and the reporting framework or materiality approach used inside it.
What does this mean for companies?
Across markets, terminology varies by regulatory regime, reporting framework and audience. Companies should prioritise the requirements that apply to them, the needs of their intended readers and the evidence available to support their disclosures.
Should your company publish an ESG report or a sustainability report?
Before choosing a title, consider four questions.
1. Who is the primary reader?
If the most important readers are investors, lenders and analysts, the document should provide decision-useful information on sustainability-related risks, opportunities, targets and performance.
If the primary audience includes employees, customers, communities and other stakeholders, the report should also explain impacts, initiatives, outcomes and the organisation’s approach to sustainability.
2. What materiality assessment has been conducted?
The reporting title and content should be consistent with the materiality process used. A report based on impact materiality should explain significant impacts and how they are managed. A financial-materiality-focused report should clearly address relevant risks and opportunities.
Where both perspectives have been assessed, the report should explain how they are connected.
3. Can the data support the claims?
An investor-focused publication needs consistent definitions, comparable metrics and clear explanations of methodology. A broader sustainability report also needs reliable evidence for its claims, with sufficient context to prevent readers from drawing misleading conclusions.
In either case, the company should be able to trace reported information to its underlying data and supporting documentation.
4. Where else will the information be used?
Report content often flows into investor presentations, customer questionnaires, tenders, corporate websites, marketing materials and employer-branding communications.
Companies should consider these uses while preparing the report. Figures, targets and claims need to remain consistent when reproduced across channels.
Recommended reporting formats by company profile
| Company profile | Reporting foundation | Recommended additional publication | Suggested format |
| Listed company among the top 1,000, with primarily domestic stakeholders | BRSR and applicable BRSR Core requirements | Integrated annual report or a standalone sustainability report, depending on stakeholder needs | Sustainability narrative with clear performance metrics |
| Listed company with significant foreign ownership or global lenders | BRSR and applicable BRSR Core requirements | Sustainability report supported by an investor-focused ESG data annex | Sustainability report plus ESG databook |
| Listed company outside the top 1,000 | Applicable statutory and regulatory requirements | Voluntary sustainability report aligned with relevant frameworks and stakeholder needs | GRI-referenced sustainability report, where appropriate |
| Unlisted exporter or value-chain partner | Customer, contractual and applicable regulatory requirements | Concise, data-led disclosure addressing customer requests | ESG factsheet or sustainability data sheet |
| Company with a high-profile consumer brand | Applicable reporting requirements | Sustainability report with clearly substantiated environmental and social claims | Evidence-led sustainability report |
These recommendations are indicative. The final reporting approach should be determined by the company’s applicable obligations, material topics, stakeholder expectations and available reporting resources.
Our recommendation: separate the narrative from the data where needed
For many Indian listed companies, a practical approach is to publish a sustainability report that explains strategy, material impacts, initiatives and performance, supported by an ESG databook for users who need comparable metrics.
The sustainability report provides context and a coherent account of the company’s approach. The databook provides structured indicators, definitions, historical performance and supporting notes that analysts and rating providers can use more efficiently.
Both can draw on one controlled dataset. This reduces duplication and helps keep the annual report, BRSR, sustainability report, investor presentations and website aligned.
The objective is not to produce more documents. It is to provide the right information in a format that meets each audience’s needs.
What should a credible second report contain?
Regardless of its title, a useful publication should contain five elements.
- A clear materiality statement. Explain whether the assessment focuses on impacts, financial risks and opportunities, or both. Identify the stakeholder groups consulted and describe how the material topics informed the report.
- A reconciliation with BRSR. Map repeated metrics to the relevant BRSR disclosures. Use consistent definitions, organisational boundaries, reporting periods and units. Where figures differ, explain the reason rather than leaving readers to reconcile them independently.
- A documented claims register. Record significant environmental and social claims, the evidence supporting each claim, the responsible owner and any relevant assurance status. This can help teams maintain consistency across reports and external communications.
- A transparent target tracker. Disclose targets with their baselines, timeframes, progress and current status. Explain changes to targets or methodology and provide context where progress is behind plan.
- A forward-looking reporting plan. Identify upcoming reporting requirements, evolving customer requests and relevant framework changes. Companies with international value chains should also monitor the requirements applicable to their markets and customers.
These elements help make a report more useful, traceable and credible. They also make the report title a reflection of its content rather than a substitute for it.
Frequently asked questions
What is the difference between an ESG report and a sustainability report?
An ESG report typically emphasises how sustainability-related factors affect business risks, opportunities and enterprise value. A sustainability report generally explains the organisation’s impacts on the economy, environment and people. The terms overlap, and the actual distinction depends on the report’s audience, materiality approach and content.
Is an ESG report mandatory in India?
A separate document titled “ESG report” is not the prescribed reporting instrument for the top 1,000 listed entities. These entities are required to include BRSR in their annual reports under SEBI’s LODR Regulations. A separate ESG or sustainability report may be published voluntarily to meet additional information needs.
Can BRSR replace a sustainability report?
BRSR provides the prescribed disclosure framework for applicable listed entities. A separate sustainability report may offer additional context on strategy, material impacts, initiatives and performance. Whether it is needed depends on the company’s stakeholders, reporting objectives and existing disclosures.
Should our company use the title “ESG report” or “sustainability report”?
Choose the title that best reflects the intended audience and the content of the report. For many Indian listed companies, a sustainability report supported by an investor-focused ESG databook can serve broader stakeholder needs while providing structured data for analysts and rating providers.
Why are some companies dropping “ESG” from report titles?
The terminology used by companies varies by market and audience. Teneo’s 2026 review found a decline in the use of “ESG” in S&P 500 report titles, even as many companies continued to publish reports. Companies should assess their own reporting objectives rather than follow terminology trends without considering their context.
Do greenwashing guidelines apply to sustainability reports?
The CCPA’s 2024 guidelines address greenwashing and misleading environmental claims in consumer-facing communications. A report is not automatically an advertisement, but environmental claims reproduced in marketing, website or product communications may need to meet applicable requirements for substantiation and accuracy.
Does a sustainability report need external assurance?
The assurance requirements applicable to a company depend on the relevant regulatory framework and disclosures. Beyond mandatory requirements, companies may consider external assurance to strengthen confidence in selected metrics and claims. The scope of assurance should be clearly communicated and should not be presented as covering information that was not assured.
What should an unlisted supplier publish?
An unlisted supplier should start by identifying the sustainability information requested by customers, lenders and other relevant stakeholders. A concise, data-led disclosure with clear definitions, reporting boundaries and supporting evidence may be more useful than a lengthy narrative that does not address those information needs.
Where K&A comes in
Choosing between an ESG report and a sustainability report is ultimately a decision about audience, evidence and communication. The publication should make the company’s priorities clear while ensuring that its narrative, metrics and claims are consistent.
K&A supports companies across annual reporting, BRSR, sustainability reporting and corporate communications, helping align reporting frameworks, performance data and stakeholder-facing narratives.
| If you are planning your FY 2026–27 reporting suite, connect with K&A to develop a reporting approach that fits your requirements and stakeholders. |
