No Match Found
Monday, 4 December 2023 – PwC India, today launched a framework for the Environmental, Social and Governance (ESG) assessment of cities, developed in partnership with the Centre for Water and Sanitation (CWAS), CEPT Research & Development Foundation (CRDF) at CEPT University.
The framework is aimed to encourage Indian cities to become ESG-ready and create an enabling environment for investors in India. It includes 62 indicators covering themes on global development goals and national commitments, in addition to the municipal functions mandated to local governments.
Speaking on the launch of the framework, Meera Mehta, Head, CWAS-CRDF-CEPT University said, “Infrastructure for development in India has been generally financed through public funds. However, there are some emerging blended finance approaches and a revival of municipal and green bonds. Cities are being encouraged to raise their own funds in the market. ESG, as it is important for corporate financing, is also likely to become important for cities in their efforts. The idea of ESG for cities is not just to build credentials with investors and regulators but to also create awareness on how cities themselves respond to existing government programmes for environment, social and governance issues. It is also important for city governments to report back to citizens about their performance on these important pillars.”
Nidish Nair, Executive Director – Climate Resilience and Cities, PwC India, said, “The CWAS and PwC team shall support cities that wish to deep-dive into the assessment, and explore improvements in aspects related to environment, social and governance with more granular, city-specific and comparative insights derived from the framework and ratings. Such insights could drive better allocation of technical and financial resources by cities and potential investors as well as become an integral part of the cities’ investment programmes. An interactive dashboard has also been developed for cities and investors to explore their areas of focus.”
The ESG rating system developed for the assessment of cities starts with ‘Initiators’, which are cities that have indicated their intent to undertake a few actions on the E, S and G fronts. An increasing score leads to a city being ranked as an ‘Aspirant’, ‘Performer’ and subsequently an ‘Achiever’. Cities that showcase exemplary performance on the E, S, and G pillars achieve the highest score and are classified as ‘Leaders’. The framework has been applied initially to 20 cities, for demonstration purposes, using publicly available information. An ESG rating is derived for each city based on the score assigned to the three pillars. The rating reflects the level of development of a given city compared to its peers.
The ESG assessment framework shows that the 20 pilot cities have performed well on the ‘Social’ pillar, which can be attributed to recent government welfare programmes. On the other hand, their performance was mixed on the ‘Governance’ pillar – while urban local bodies (ULBs) of cities are demonstrating greater accountability, the fiscal health of these cities is yet to reach a satisfactory level.
Further, there is considerable scope for improvement on the ‘Environmental’ pillar, with low scores on indicators around water resource management, commute systems and green ecosystem, despite many cities scoring well on policy interventions focused on sustainable development. This indicates the gap between policy frameworks and actual implementation, which cities would need to address by exploring avenues such as public-private partnerships (PPPs) and green bonds.
The Center for Water and Sanitation (CWAS) is a part of CEPT Research and Development Foundation (CRDF) at CEPT University. CWAS undertakes action-research, implementation support, capacity building and advocacy in the field of urban water and sanitation. Acting as a thought catalyst and facilitator, CWAS works closely with all levels of governments - national, state and local to support them in delivering water and sanitation services in an efficient, effective and equitable manner. Know more about the centre at cwas.org.in.
At PwC, our purpose is to build trust in society and solve important problems. We’re a network of firms in 152 countries with over 327,000 people who are committed to delivering quality in Assurance, Advisory and Tax services. Find out more and tell us what matters to you by visiting us at www.pwc.com.
PwC refers to the PwC network and/or one or more of its member firms, each of which is a separate legal entity. Please see www.pwc.com/structure for further details.
© 2023 PwC. All rights reserved.