CSRD: What Indian Suppliers to European Companies Must Do Now

CSRD entered into force on 5 January 2023 and began applying to large EU companies from the 2025 financial year. Companies must report according to European Sustainability Reporting Standards (ESRS), covering environmental, social, and governance topics across their entire value chains — including their Indian suppliers.

The Indian supplier impact: An EU pharmaceutical company sourcing APIs from Hyderabad must report on carbon emissions, water consumption, labour practices, and chemical waste of its Indian API suppliers. An EU clothing brand sourcing garments from Bengaluru must report on working conditions, energy consumption, and chemical management of its Indian garment factories.

What Indian suppliers will be asked to provide: GHG emissions (Scope 1, 2, and potentially Scope 3 upstream), energy consumption and renewable energy percentage, water consumption and wastewater, chemical waste, worker welfare data (wages versus minimum wage, safety incident rate, working hours), supplier diversity, and compliance with ILO core labour conventions.

An Indian supplier 6-step CSRD readiness plan: (1) Identify which EU buyers are subject to CSRD (companies with 500+ employees from 2025); (2) Inventory what sustainability data these buyers will likely request; (3) Implement GHG accounting using GHG Protocol methodology; (4) Obtain third-party sustainability audit (SA 8000, SMETA, EcoVadis); (5) Build a supplier sustainability questionnaire response library; (6) Consider EcoVadis or CDP rating — standardised ratings that many EU buyers accept in lieu of bespoke data requests.