Redefining consumer trust - ESG integrity threats in the product lifecycle

The Indian consumer market is experiencing remarkable growth, positioning India as a pivotal player in the global consumer landscape. This surge is fueled by a burgeoning middle class, digital transformation, and evolving consumer preferences. Environmental, Social, and Governance (ESG) considerations have also become essential for organisations to gain consumer trust.

The ESG regulatory landscape is becoming more stringent, with the regulators increasing the disclosures and reporting of ESG metrics. Non-compliance of ESG regulations may result in significant penalties and reputational loss due to the heightened expectations for corporate responsibility on environment and social equity.

ESG integrity risks could severely impact organisations in the consumer markets sector throughout the product lifecycle – spanning across areas such as product development, procurement, manufacturing, marketing, sales and distribution, destruction of damaged/expired products, marketing and advertising, among others.

While the ESG landscape is still evolving in India and across the globe, multiple organisations have implemented best practices for responsible sourcing, which set clear requirements for third parties associated with them on various parameters such as traceability, labour practices, and environmental impacts. With the ESG regulations becoming progressively stringent, organisations must implement robust ESG governance framework, strengthen supply chain traceability and foster a culture of transparency and accountability throughout the product lifecycle.