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Yes, Governance Matters.: Boeing Shareholder Vote: ESG in action

Yes, Governance Matters.: Boeing Shareholder Vote: ESG in action

Posted by By at 17 May, at 21 : 21 PM Print

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May 17, 2024



  • Shareholder activism in recent times has increasingly pushed for greater transparency and accountability in companies’ ESG practices.
  • The legal framework governing ESG reporting in India should further incorporate a significant emphasis on human rights compliance.
  • The intersection of ESG and human rights underscores the importance of collaborative efforts involving governments, corporations, NGOs, and stakeholders to uphold human rights and promote sustainable business practices globally. 


In the wake of Boeing’s shareholder meeting1, a new spotlight has been cast on the intricate balance between corporate Environmental, Social, and Governance (ESG) commitments and human rights practices. This discussion gains a significant dimension when viewed from the Indian perspective, where ESG compliance is becoming increasingly critical for multinational corporations operating in the country. Generally, ESG reporting for companies serves to ensure that they undertake their operations responsibly and are continually monitored in the process. Although no universally accepted standard for ESG reporting exists, various regional frameworks, voluntary standards, and national legislations mandate such reporting.2

The ‘E’ in ESG stands for environment and covers the actions a company takes in relation to the environment and the related disclosures. This includes measures undertaken by a company to combat climate change, reduce carbon emissions, preserve the environment (such as improving air quality and preventing deforestation) and responsibly managing waste.3

The ‘S’ in ESG stands for social aspects of a company’s operations and reflects the responsibility of the company towards society at large. This includes measures undertaken by companies to ensure equality among employees, initiatives for greater inclusivity (such as gender, BIPOC and LGBTQ+ initiatives) and efforts to comply with human rights and labor standards.4

Lastly, the ‘G’ in ESG stands for governance and includes a company’s internal controls and policies to address corruption within its management. It also involves assessing the overall efficiency of the corporate governance structure, including the effectiveness of its board, audit committees, shareholder rights etc.5

The recent instance of shareholder proposal at Boeing’s Annual Meeting for an independent, third-party audit of the company’s ESG compliance in its annual report due to company’s operations in China, particularly focusing on concerns over human rights abuses in Xinjiang. This proposal, submitted by the National Legal and Policy Centre (NLPC), underscores the need for transparency and accountability, urging Boeing’s board of directors to commission and publish a third-party review within the next year about its China operations.

This is a testament to how shareholder’s activism in recent times is advocating for greater transparency and accountability in companies’ ESG Practices.

From an Indian standpoint, Boeing’s situation serves as a critical case study. Indian companies, particularly those with international operations, must navigate similar challenges. For instance, Indian IT and manufacturing sectors often face scrutiny over labor practices and environmental impacts, necessitating robust ESG strategies. Consequently, it is important to examine the ESG reporting framework in India and suggest measures to address stakeholder concerns.

This article addresses the legal framework governing ESG reporting in India and greater emphasis on human rights compliance under ESG in recent times.


In India, the ESG framework is not governed by one single law or regulation. The Securities and Exchange Board of India’s (‘SEBI’) Business Responsibility and Sustainability Reporting (‘BRSR’) guidelines are the primary document governing ESG disclosure in India. The BRSR framework has taken references from many global reporting frameworks such as the Global Reporting Initiative (‘GRI’), the Sustainability Accounting Standards Board (‘SASB’) and the Task Force on Climate-Related Financial Disclosures (‘TCFD’).6 BRSR is applicable to the Top 1000 listed companies by market capitalization.

Further, SEBI’s Listing Obligations and Disclosure Regulations (‘LODR’) read with the Companies Act, 2013 (‘Companies Act’) also mandate a business responsibility report as a part of the annual report covering ESG aspects for the Top 1000 listed companies by market capitalization.7

BRSR seeks disclosures from listed entities on their performance against the nine principles of the ‘National Guidelines on Responsible Business Conduct’ (‘NGBRCs’) and reporting under each principle is divided into essential and leadership indicators. The Principles are stated below;

Principle 1: Businesses should conduct and govern themselves with integrity and in a manner that is ethical, transparent and accountable.

Principle 2: Businesses should provide goods and service in a manner that is sustainable and safe.

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

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

Principle 5: Businesses should respect and promote human rights.

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

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

Principle 8: Businesses should promote inclusive growth and equitable development.

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

The essential indicators are required to be reported on a mandatory basis while the reporting of leadership indicators is on a voluntary basis.8 BRSR also ensures a qualitative and standardized disclosure, thereby helping investors make better informed and ESG-friendly decisions.9

SEBI has also released BRSR ‘Core’ Guidelines on July 12, 2023. The BRSR Core identifies new Key Performance Indicators (‘KPIs’) beyond those identified in the Original BRSR guidelines and the ESG Standards recognized therein.10 Further, the BRSR Core contains a limited set of a total of nine key performance indicators covering each of the E, S and G areas, for which listed entities are required to obtain reasonable (external) assurance to enhance its reliability and mitigate greenwashing. The BRSR Core has been made applicable in a staggered manner, starting from the Top 250 listed companies in FY 2023-24 to the Top 1000 listed companies by FY 2026-27.11 The BRSR Core Circular also mandates disclosure of value chain, comprising the top upstream and downstream partners of a listed entity, cumulatively comprising 75% of its purchases / sales (by value) respectively.12

Thus, the legal framework governing the ESG responsibilities of companies are modeled under different instruments. ESG reporting is mandatory for the Top 1000 listed companies and by 2027, they will also be required to obtain reasonable (external) assurance on BRSR KPIs. For companies not falling within this bracket, ESG reporting becomes a largely voluntary endeavor. 


In recent years, India as well has seen increased activism and regulatory pressure to address human rights issues in supply chains. Companies like Tata and Infosys have been lauded for their comprehensive ESG disclosures, yet challenges remain, especially in sectors like textiles and mining where labor rights violations are more prevalent. Human rights issues in supply chains have been uncovered in recent times, as is evinced from the Boeing example above. The balance between economic interests and ethical obligations is a delicate one, and Boeing’s stance illustrates the complexities involved. Not only has the scope of human rights broadened in recent times, there has also been a greater emphasis on corporations to ensure compliance with human rights in all their chains of operations.13 However, not only is it insufficient for companies to ensure human rights compliance within the broad range of their own operations, their alignment with governments of the world which have been recurrently accused of human rights violations has also been brought under the spotlight.14

Arguably, the ‘S’ in ESG is said to encompass the broad range of human rights. It includes, for instance, the rights to life, freedom, and security, to equality before the law, to be free from torture and slavery, to be exempt from forced labor, and to be free from discrimination enumerated in the 1948 Universal Declaration of Human Rights.15

Among other things, global supply chains offer opportunities for development, employment, and growth. However, they also witness abuses of human rights such forced employment, child labor, and human trafficking. Thus, it is crucial that all parties involved—including the government, corporations, NGOs, and others—check supply chains for potential violations of human rights.16


The landscape of ESG reporting is a dynamic and evolving framework aimed at fostering responsible corporate behavior. India’s approach, led by SEBI’s BRSR guidelines, integrates global best practices while addressing the unique needs of its corporate ecosystem.

The recent introduction of the BRSR Core further emphasizes the commitment to enhancing transparency and accountability by mandating external assurance for key performance indicators. Additionally, the intersection of ESG and human rights is becoming increasingly prominent, as seen in the heightened scrutiny of supply chain practices. Collaborative efforts involving governments, corporations, NGOs, and other stakeholders are crucial to uphold human rights and promote sustainable business practices in the global economy.

The shareholder vote at Boeing demonstrates ESG in action. The vote is likely to force discussion on difficult issues having global ramifications and has the ability to change the ways in which long-standing business relationships evolve. The outcome of Boeing’s shareholder vote could set a precedent for multinational corporations, including those in India, regarding how they address ESG concerns linked to their international operations. As Indian companies expand globally, they must be prepared to face similar scrutiny and ensure their ESG commitments are not merely superficial but deeply integrated into their business practices. As India continues to evolve as a major player in the global economy, robust ESG practices will not only enhance corporate reputation but also ensure long-term sustainability and success.
– Maulin Salvi and Sahil Kanuga

You can direct your queries or comments to the authors.

(The authors would like to acknowledge and thank Dev Adwani, Fourth Year, BA.LLB (Hons.), West Bengal National University of Juridical Sciences, Kolkata, for his contribution to this article.)


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Nishith Desai Associates (NDA) is a research based international law firm with offices in Mumbai, Bangalore, Silicon Valley, Singapore, New Delhi, Munich and New York.


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