Bridging the ESG Integration Gap: Challenges and Strategic Solutions in the Indian Industrial Context Through Cultural and Technological Lenses

The rising salience of environmental, social, and governance (ESG) frameworks in management heralds a shift towards ethical and sustainable leadership in business. In the Indian context, changing regulatory requirements and heightened socio-environmental concerns are pushing organisations, particularly in the construction and manufacturing sectors to address multiple challenges to embed ESG criteria in their organisations. This chapter examines the challenges associated with ESG and presents possible solutions rooted in theory to advance meaningful ESG integration. Using organisational culture theory (OCT), the chapter demonstrates how leadership values, organisational assumptions and cultural norms influence an organisation’s ability to embrace ESG practices. The chapter suggests that cultural change can occur when leadership expresses commitment and action-oriented values, historicising the organisation’s value-laden stories, and by introducing change agents that make ESG normal. The segregated ESG reporting environment can present another challenge. Indian companies often have to deal with contradictory standards, weighing global frameworks (e.g., Global Reporting Initiative (GRI), Task Force on Climate-related Financial Disclosures (TCFD)) and national mandates (e.g., business responsibility and sustainability reporting (BRSR)) with many firms producing superficial compliance reports. One solution is a dual-layered reporting model that includes global benchmarks with local key performance indicators (KPIs), which adds authenticity and accountability to the reporting mechanism. This chapter employs technology integration theory (TIT) to examine the factors from perceived usefulness, perceived ease of use, and personal readiness in the uptake of ESG-tech, along with case studies demonstrating issues of scalability. The chapter proposes to address knowledge gaps, particularly with Tier II and III firms, as well as in implementing appropriate linkages between industry and academia, ESG literacy programmes and centrally coordinated support systems.