BRSR for IT services companies: what 'not applicable' really means

IT and software services companies have a complicated relationship with BRSR. Many of the format's most data-intensive sections assume a manufacturing context: smokestacks, effluent treatment plants, hazardous waste disposal. But "not applicable" is not a blanket permission to skip half the format. Used incorrectly, it invites SEBI scrutiny. Used correctly, it simplifies the filing without misrepresenting the company's profile. Here is a precise guide to what is and is not applicable for IT services filers.

Which disclosures IT companies can legitimately mark not applicable

Eleven Section-C indicators in BRSR are specific to manufacturing operations. For a company that is purely a services business (no manufacturing, no physical product, no factory operations), each of these can be marked "not applicable" with a brief written justification. The indicators are:

• P2-E3: EPR registration for plastic waste, applies to producers of plastic-packaged goods, not software companies.
• P2-E4: Extended Producer Responsibility for e-waste, applies to manufacturers of electronic products.
• P2-L4: Producer responsibility for products, manufacturing-specific.
• P2-L5: Reclaimable products and packaging, manufacturing-specific.
• P6-E2: Air emissions from stacks and fugitive sources, applies to plants with industrial combustion or process emissions.
• P6-E4: Volume of effluent generated, applies to wet-process manufacturing.
• P6-E5: Zero Liquid Discharge compliance, applies to process industries.
• P6-E6: Water body impacts, applies to companies with industrial effluent discharge.
• P6-E11: Environmental fines for manufacturing violations, not applicable to non-manufacturers.
• P6-E12: Environmental Impact Assessment, required for factory expansions, not office IT operations.
• P6-L3: Biodiversity management plan, applies to companies with operations near sensitive ecological areas, typically manufacturers.

What IS applicable and often under-reported by IT companies

The not-applicable list covers only eleven indicators. The remaining 97 Section-C indicators apply to IT companies just as much as to manufacturers. Several of these are consistently under-reported or mis-scoped by IT filers:

Scope 2 emissions for IT companies: larger than you think

For a large IT company with multiple campuses and data centers, Scope 2 GHG emissions from grid electricity can be the dominant environmental disclosure. A campus consuming 10 million kWh per year generates 7,100 tCO2e at the current CEA grid factor of 0.710 kg CO2e/kWh (CEA Version 21.0). A data center running 24/7 can consume far more. The calculation is straightforward:

Grid electricity purchased (kWh) × 0.710 ÷ 1,000 = Scope 2 (tCO2e)

If your client has on-site solar panels, use only the grid import figure (not total consumption) for Scope 2. Renewable electricity generated on-site is not counted as Scope 2 under the location-based method.

Energy intensity: the correct denominator for IT

P6-E7 requires energy intensity: total energy consumed (in gigajoules) divided by an appropriate denominator. For IT services companies with no physical output, turnover in ₹ crore is the standard denominator. Convert electricity from kWh to GJ using the factor 3.6 MJ/kWh (1 kWh = 0.0036 GJ). If your client also uses diesel for DG sets, add the diesel energy content (approximately 38.65 MJ/litre, per IPCC 2006) before dividing by turnover.

P3 workforce data: the contractor gap

IT companies typically have large pools of contract workers: security personnel, cleaning and facility management staff, cafeteria workers, and sometimes on-site logistics. These workers are usually employed by a third-party contractor and are not tracked in the company's HRMS. BRSR P3-E1 requires disclosure of all workers on site, including "other-than-permanent workers" sourced from third parties. Collect this headcount from the Facilities or Admin team, not HR, and segment it by male/female where possible.

Key takeaways

• Eleven Section-C indicators are genuinely not applicable to pure IT services companies. Each requires a written justification, not just a blank.
• Scope 2 GHG from office and data center electricity is fully applicable and can be material for large IT companies.
• P6-E7 energy intensity uses turnover as the denominator for IT. It is not a manufacturing-only indicator.
• Third-party contractor headcount (security, facility management) must be included in P3 workforce disclosures.
• Gender wage ratio (P5-E4) requires a payroll report segmented by gender. This data exists in any modern HRMS.