HEG ESG score downgraded to 60 for FY26 by NSE Sustainability
- NSE Sustainability Ratings downgraded HEG's ESG score to 60 for FY26 from 63 in FY25
- The rating applies to the graphite business prior to its demerger on September 1, 2026
- Environment pillar scored lowest at 45 due to high emissions intensity and low renewable energy use
- Social pillar scored highest at 77 driven by zero fatalities and strong safety records
- Core ESG Rating based on BRSR disclosures stands at 55
*this image is generated using AI for illustrative purposes only.
HEG received an Environmental, Social and Governance (ESG) score of 60 for FY26, a downgrade from the 63 recorded in FY25. NSE Sustainability Ratings & Analytics Limited assigned the "Adequate" rating category based on publicly available data.
The disclosure was made under Regulation 30 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. The rating pertains to the period prior to the effectiveness of the Composite Scheme of Arrangements, which demerged the graphite business into a separate entity effective September 1, 2026.
Rating Breakdown
The overall ESG score comprises three pillars with specific weightages and scores:
| Pillar | Weightage | Score |
|---|---|---|
| Environment | 40% | 45 |
| Social | 29% | 77 |
| Governance | 31% | 63 |
The Core ESG Rating, derived from BRSR Core disclosures, stands at 55. This includes an environment score of 37, a social score of 66, and a governance score of 67.
What the Numbers Show
The divergence between the Social score (77) and the Environment score (45) highlights a significant gap in performance areas. While the company reports zero fatalities and high health insurance coverage for permanent employees, it faces challenges in environmental stewardship. Key environmental metrics show greenhouse gas emissions and energy intensity exceeding industry averages, despite year-on-year decreases in emissions intensity.
Key Drivers
Environmental factors weighed heavily on the final score. The report notes that reliance on renewable energy is minimal, with only 0.44% of energy consumed from renewable sources. Waste intensity stands at 1.47 metric tonnes per crore rupee of revenue, above industry averages. However, waste recycling and recovery rates increased by 2% compared to the previous year.
Social metrics showed strength in safety and compliance. The Lost Time Incident Rate (LTIR) for employees was 0, and there were no reported fatalities among employees or workers. CSR spending exceeded obligations at 106.67% of the required amount. However, women remain underrepresented, constituting just 6.05% of the workforce.
Governance practices met regulatory requirements but faced scrutiny on executive compensation. The board includes 50% independent directors, fulfilling statutory norms. However, the CEO-to-median employee pay ratio is significantly higher than industry peers, and executive remuneration is not linked to ESG performance parameters.
Historical Stock Returns for HEG
| 1 Day | 5 Days | 1 Month | 6 Months | 1 Year | 5 Years |
|---|---|---|---|---|---|
| -4.99% | -66.47% | -65.30% | -54.49% | -53.39% | 0.0% |
How will the demerger of the graphite business impact HEG's future ESG trajectory, particularly regarding the reduction of environmental liabilities?
What specific strategies is HEG implementing to address its critically low renewable energy usage of 0.44% and align with India's broader sustainability goals?
Will the company revise its executive compensation structure to include ESG performance metrics in response to governance scrutiny?
Access Market Heat-map & Insights 
Create, Save & Share your Screener 
Use 200+ Screening Filters 
