What SEBI asks, verbatim
Provide the measures undertaken by the entity to ensure that statutory dues have been deducted and deposited by the value chain partners
Describe measures to ensure value chain partners comply with statutory dues (labor, employment, taxes, environmental protection).
Quoted from the SEBI BRSR Format as amended March 2025, with measurement guidance from the ICAI Background Material on BRSR, Revised Edition 2024, page 118.
In plain English
The company must explain what it does to make sure its suppliers and other partners pay and remit all required taxes, labor and environmental fees. It should describe the steps taken—such as audits, agreements or monitoring tools—to verify that these statutory dues are deducted and deposited. This information is usually gathered from supplier contracts, audit reports and payment records.
What a complete, assurance-ready answer contains
A complete, assurance‑ready answer lists the formal policies, contractual clauses and monitoring mechanisms that the entity enforces with each tier‑1 and tier‑2 supplier, including audit rights, compliance checklists and penalty provisions. It provides a data table showing the number of partners audited, the percentage of those meeting statutory due‑payment criteria, and any corrective actions taken, with quarterly or annual frequency. A common gap is omitting the escalation process for non‑compliance, which assurers look for to confirm that remedial steps are actually enforced.
Describes the completeness and granularity an assurer expects. No company figures are named.
Where the data comes from
Usually found in payroll and HR records. Forward this section to your People team.
Much of what BRSR asks for already exists in filings the company makes elsewhere, such as Pollution Control Board consents, PAT returns, hazardous-waste manifests and EPR registrations. The free gap analysis cross-references those filings against all 108 fields and shows which are already covered.
Frequently asked questions
What does BRSR P3-L2 ask for?
The company must explain what it does to make sure its suppliers and other partners pay and remit all required taxes, labor and environmental fees. It should describe the steps taken—such as audits, agreements or monitoring tools—to verify that these statutory dues are deducted and deposited. This information is usually gathered from supplier contracts, audit reports and payment records.
Is BRSR P3-L2 an Essential or a Leadership indicator?
P3-L2 is a Leadership indicator, so it is voluntary. Leadership indicators apply to companies that have been filing BRSR for three or more years, or that are in the top 1000 listed companies. A first-time filer can leave it out.
Who inside the company holds the data for P3-L2?
HR / People team. Usually found in payroll and HR records. Forward this section to your People team.
What unit does P3-L2 use?
narrative. Reporting in the wrong unit, or switching the denominator of an intensity ratio between years, is one of the more common reasons a figure has to be restated.
What does a complete answer to P3-L2 look like?
A complete, assurance‑ready answer lists the formal policies, contractual clauses and monitoring mechanisms that the entity enforces with each tier‑1 and tier‑2 supplier, including audit rights, compliance checklists and penalty provisions. It provides a data table showing the number of partners audited, the percentage of those meeting statutory due‑payment criteria, and any corrective actions taken, with quarterly or annual frequency. A common gap is omitting the escalation process for non‑compliance, which assurers look for to confirm that remedial steps are actually enforced.
Other disclosures under Principle 3
Well-being measures for employees and workers (health insurance, accident cover, etc.; % covered)
Retirement benefits offered (PF, gratuity, ESI) for this year and last year
Are your premises accessible to differently-abled staff? (Yes/No + steps)
Do you have an equal-opportunity policy? (Yes/No + web link)
Return-to-work and retention rates after parental leave
Do you have a grievance mechanism for employees and workers? (Yes/No + details)
See P3-L2 against a real client
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