SEBI tweaks framework for ESG Rating Providers using subscriber-pays model

SEBI (Securities and Exchange Board of India) has tweaked the framework for ESG (Environmental, Social, and Governance) rating providers, introducing a subscriber-pays model. This change in the regulatory framework will likely impact how ESG rating agencies operate and how their services are consumed. The subscriber-pays model means that the entities seeking ESG ratings will bear the cost, which could influence the demand for and transparency of these ratings. SEBI's move aims to enhance the reliability and comparability of ESG ratings, which are increasingly important for investors considering sustainability factors.