ONGC Receives "B" ESG Rating of 61.1 from SES; Scores Lower on Environmental and Governance Factors

New Delhi, February 7, 2026 – Oil and Natural Gas Corporation Limited (ONGC), India's leading energy Maharatna PSU, has disclosed an independent ESG (Environmental, Social, and Governance) rating report for FY 2024-25, scoring 61.1 out of 100 and receiving a "B" grade. The report was prepared and issued by SES ESG Research Pvt. Ltd., a SEBI-registered ESG rating provider.

Key ESG Performance Highlights (FY 2024-25):

• Overall ESG Score: 61.1 (B Grade) - A decrease from 63.9 in FY 2023-24.

• Pillar-Wise Scores (Risk-Adjusted):

  • Environment: 49.3

  • Social: 68.3

  • Governance: 67.2

• Parivartan (Transition) Score: 33 - Indicating limited progress on key quantitative ESG parameters year-on-year.

• ESG Assurance: The company's Business Responsibility and Sustainability Report (BRSR) for the period received "Reasonable Assurance" from Bureau Veritas.

SES ESG Report: Key Observations and Concerns

The SES report, prepared based on publicly available information without consultation with ONGC, highlights several areas of strength and concern:

Environmental (Score: 49.3):

• Strengths: ONGC holds multiple ISO certifications (14001, 45001, 50001, etc.). No water is discharged without treatment.

• Concerns: The company's ESG score was significantly impacted by its high industry risk exposure in the Oil Exploration & Production sector. Specific challenges include:

  • Increased Footprint: Total energy consumption, GHG emissions (Scope 1 & 2), and Scope 3 emissions increased year-on-year in FY25.

  • Low Renewable Mix: Renewable energy constitutes only 0.25% of total energy consumption.

  • Waste Management: Only 2.6% of total waste generated was recycled; 97% was disposed of through other methods.

  • Compliance Issues: Show Cause notices were issued during the year under environmental laws for incidents like an oil spill.

Social (Score: 68.3):

• Strengths: Low employee turnover (<1%), 100% workforce paid above minimum wage, and increased spending on employee training.

• Concerns:

  • Health & Safety: Three fatalities and 39 work-related injuries were recorded in FY25. A significant gas release incident occurred at the Rudrasagar Field in Assam.

  • Complaints: Three complaints of sexual harassment and two of workplace discrimination were filed.

  • Training Gaps: No human rights training data disclosed; significant portions of the workforce did not receive skill-upgradation or health & safety training.

Governance (Score: 67.2):

• Strengths: Unqualified statutory audit report, disclosure of key financial ratios, and a comprehensive suite of policies (Anti-Bribery, RPT, Whistle-blower, etc.).

• Significant Concerns:

  • Board Composition: The Board does not have the requisite number of Independent Directors (IDs) and Non-Executive Directors (NEDs) as mandated by SEBI LODR regulations. This non-compliance led to penalties from stock exchanges.

  • Executive Chairman: Mr. Arun Kumar Singh holds the combined position of Chairman and Managing Director, leading to concerns about concentration of power.

  • Material RPTs: The report flags governance and transparency concerns regarding inadequate disclosure of the basis for arm’s length pricing and justification for certain material related-party transactions.

  • Secretarial Audit: The Secretarial Audit Report contained qualifications regarding non-compliances in board and committee composition.

Company's Stance and Strategic Targets

ONGC emphasized in its disclosure that it did not engage SES ESG for the rating. The company has set strategic sustainability targets, including achieving Net Zero operational emissions (Scope-1 & 2) by 2038, generating 10 GW of renewable energy capacity by 2030, and aiming for Zero Routine Flaring by 2030.

Outlook

The "B" rating and the year-on-year score decline reflect the inherent environmental challenges of the fossil fuel sector and highlight specific operational and governance issues ONGC must address. The report underscores the increasing scrutiny of ESG performance for large public sector enterprises, especially as they navigate the energy transition. ONGC's progress on its stated decarbonisation and governance goals will be critical for its future ESG ratings.

About ONGC:
Oil and Natural Gas Corporation Limited (ONGC) is India's largest crude oil and natural gas company, contributing around 71% of the country's domestic production. It is a Maharatna PSU under the administrative control of the Ministry of Petroleum and Natural Gas.