Shriram Finance Limited Secures 'Outstanding' ESG Impact Rating from ICRA ESG

Shriram Finance Limited has been recognized for its exemplary Environmental, Social, and Governance (ESG) performance with an 'Outstanding' rating of 82 by ICRA ESG, a Category-I ESG Ratings Provider (ERP) licensed by the Securities and Exchange Board of India. This achievement highlights Shriram Finance's leadership in sustainable finance and its commitment to responsible business practices.

The company's strong ESG performance is reflected across all key dimensions. On the environmental front, Shriram Finance has shown significant progress with a score of 76 (Good), driven by its low operational impact, energy efficiency measures through LED lighting and energy-efficient appliances, and innovative green financing initiatives. The company has set an ambitious target to build a ₹5,000 crore green portfolio focused on electric vehicles, renewable energy projects, and sustainable infrastructure. Its efforts to reduce financed emissions and promote digital onboarding processes have further contributed to its environmental stewardship.

Shriram Finance's social impact score of 94 (Outstanding) stands out for its transformative initiatives. The company has made substantial contributions to community development through its CSR programs, particularly in supporting truck drivers and their families with skill training, healthcare access, and educational scholarships benefiting over 300,000 students. Employee welfare remains a priority, with comprehensive benefits including health insurance, parental leave, and career development opportunities. Shriram Finance's Social Finance Framework further amplifies its impact by channeling funds toward underserved communities and MSMEs, reinforcing its commitment to financial inclusion.

Governance excellence, with a score of 82 (Outstanding), underscores company's robust board structure, transparency, and ethical business conduct. The company's board, with a majority of independent directors, ensures strong oversight and accountability. Shriram Finance maintains high standards of disclosure through integrated annual reports and sustainability disclosures, backed by reasonable assurance processes. Its proactive approach to compliance, including the use of regulatory technology, further strengthens its governance framework.

While Shriram Finance Limited's ESG achievements are commendable, ICRA ESG has identified areas for improvement, including the adoption of renewable energy, enhanced gender diversity at leadership levels, and the setting of measurable environmental targets aligned with global standards. Currently, women represent 10% of the board, highlighting an opportunity for progress.

Source : Equity Bulls

Keywords

ShriramFinance ESGImpact Rating ICRAESG