ONGC Pioneers Double Materiality Assessment in India’s PSU Sector

Oil and Natural Gas Corporation (ONGC) has become the first Indian Public Sector Undertaking (PSU) to conduct a Double Materiality Assessment, a globally recognized framework highlighted in its Integrated Annual Report for FY 2024–25. The assessment, aligned with European Sustainability Reporting Standards (ESRS), goes beyond traditional financial reporting to capture both how environmental and social issues impact ONGC and how the company’s operations affect society and the environment.

This dual perspective strengthens ONGC’s sustainability disclosures, enhancing transparency, accountability, and long-term value creation for stakeholders. The company emphasized that the assessment represents a significant step in aligning its business with evolving global sustainability expectations.

By adopting this approach, ONGC has set a precedent for the Indian energy sector and the wider PSU ecosystem. The milestone demonstrates its commitment to balancing energy production with environmental stewardship, marking a new chapter in responsible and sustainable business practices in India.

Double materiality - evaluating both how sustainability issues affect a company and how a company affects sustainability outcomes - is the core methodological principle underlying the EU's Corporate Sustainability Reporting Directive. ONGC's adoption of a DMA aligned with ESRS is a significant methodological step for the Indian PSU sector, extending Indian corporate sustainability reporting toward what is arguably the most rigorous global framework.

For a large hydrocarbon producer, applying DMA rigorously means candid engagement with both transition-risk exposure (how the energy transition affects ONGC's asset value and business model) and impact materiality (how ONGC's operations affect climate, biodiversity, communities and workers). Publishing this analysis raises the disclosure bar for peer PSUs and for private-sector energy companies operating in India.

For Indian corporates preparing for evolving disclosure expectations - BRSR Core, ISSB adoption in India, and CSRD applicability for those with EU market presence - Cognitud's ESG strategy and transformation, impact assessment and responsible investment teams help clients conduct DMA processes aligned with ESRS methodology, structure stakeholder engagement, and prepare disclosures that satisfy multiple overlapping regulatory expectations while providing genuinely decision-useful information for capital providers.