Background
In recent years, India’s regulatory landscape for listed entities has seen significant modernization, aimed at greater transparency, automation, and investor confidence. At the heart of this transformation are credit rating agencies (CRAs) and environmental, social, and governance (ESG) rating providers (ERPs), whose assessments play a crucial role in informing market participants of the financial health and ethical posture of companies. Traditionally, the process for disclosing such ratings has been partially manual, creating scope for procedural delays, errors, or inconsistencies. Recognizing the need for seamless, reliable, and real-time dissemination of credit and ESG ratings, the Bombay Stock Exchange (BSE) and National Stock Exchange (NSE) have introduced automated mechanisms for direct and system-driven publishing of these ratings.
Introduction
On August 1, 2025[1], the BSE issued a pivotal circular announcing that credit and ESG ratings assigned by CRAs and ERPs will now be disseminated automatically on the stock exchange websites. This marks a significant technological leap in regulatory compliance and disclosure protocols. The move is aligned with broader regulatory initiatives from SEBI and market infrastructure institutions to foster automation and reduce human intervention in reporting processes. With this measure coming into force, the responsibility shifts on both rating agencies and listed companies to interact in a more synchronized, transparent, and technologically advanced manner with the exchanges.
Insight: How the Automated Disclosure System Works
- Registration and Template Submission
Under the new framework, CRAs and ERPs must register themselves on both the BSE and NSE platforms before they can avail of the automated reporting mechanism. After registration, stock exchanges provide secure login credentials to the rating agencies, who use these credentials to access and interact with the reporting systems.
Once logged in, the authorized personnel from CRAs and ERPs are required to fill in standardized Excel templates provided by the exchanges. These templates are comprehensive and capture key disclosure fields, including:
- Class of action (such as rating action or review)
- Rating assigned
- Type of rating (credit or ESG)
- Sector and outlook assigned
- Date of rating
- Business model information for ERPs
- ESG rating press release details
Upon completion and uploading of the templates, the ratings are relayed instantly and directly onto the stock exchange website, ensuring timely and uniform dissemination to the market. This automation removes bottlenecks associated with manual submission and manual display, and reduces the risk of delays or reporting errors.
- Conditional Automation: Registration is Key
It is essential to note that the automation of disclosures is conditional upon registration. Only those CRAs and ERPs that have successfully registered on the stock exchange portals will have their ratings disseminated automatically. As long as a CRA or ERP remains unregistered, the responsibility for uploading credit and ESG ratings onto the exchange portal continues to reside with the listed entities themselves. Once the CRA or ERP have registered and ratings are disseminated, listed entities need not disclose credit ratings or ESG ratings[2]. Credit rating and ESG rating[3] is automatically getting relayed for equity listed entities, debt listed entities[4], Invits, REITs and SME entities. It is also being seen that credit rating is also getting relayed automatically for debt securities and/or commercial paper which is not listed but is issued by an entity which has its equity securities listed on a recognized stock exchange[5].
This transitional clause ensures there’s no information vacuum: until the automation is fully adopted by all rating agencies, companies must keep manually submitting their latest credit and ESG ratings. Once both CRA/ERP and listed company are integrated into the new system, manual intervention will cease for ratings disclosure.
Enhancing Market Transparency and Accountability
The direct relay ensures that ratings are accessible simultaneously to all market participants, eliminating unfair information asymmetry. It also strengthens audit trails, since every disclosure is timestamped and systematically archived on the portal.
Conclusion
The automation of credit and ESG rating disclosures by stock exchanges signals a new era of efficiency and transparency for India’s capital markets. However, until the automation infrastructure is universally adopted, listed companies must remain vigilant: they need to ensure that the data submitted by CRAs and ERPs is accurately relayed and visible on exchange portals. Companies should routinely verify that the updates reflected on the BSE and NSE websites corroborate the ratings provided by their respective agencies.