NGRBC Principle 5 — Human Rights: Disclosures, Evidence, and Audit Findings

What Principle 5 covers

The National Guidelines on Responsible Business Conduct (NGRBC) were issued by the Ministry of Corporate Affairs in 2018 and form the backbone of SEBI’s Business Responsibility and Sustainability Report (BRSR) format. Of the nine NGRBC Principles, Principle 5 covers human rights — the entity’s responsibility to respect and promote human rights across its workforce, its value chain, and the communities it operates in.

In BRSR-format terms, Principle 5 covers human rights through:

• Essential disclosures on training, minimum wages, remuneration and wages, grievance mechanisms, complaints across categories (sexual harassment under POSH, discrimination, child labour, forced labour, wages, other), and assessment of the entity’s own operations
• Leadership disclosures (for the Top 1,000 listed entities) on human-rights due diligence and value-chain partner assessment

The contextual legal background is the body of Indian statutory wage and labour law (the Code on Wages, 2019 consolidating older wage statutes; the Bonded Labour System (Abolition) Act, 1976; the Child Labour (Prohibition and Regulation) Act, 1986; the Sexual Harassment of Women at Workplace Act, 2013; and others). For Indian listed entities with international ESG reporting commitments, the UN Guiding Principles on Business and Human Rights (UNGPs) are commonly referenced as a separate framework. The BRSR disclosures themselves stand on the SEBI BRSR Format and the entity’s documented compliance position; the legal references above are background for interpretation, not BRSR-specific application rules.

This page is the reference hub for Batchwise’s coverage of P5. It overlaps materially with P3 (Wellbeing of Employees) — POSH complaints, median remuneration, and the broader complaints register are native disclosures of both principles, drawing on the same source documents.

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The Essential indicators (mandatory for every BRSR filer)

The BRSR format Section C, Principle 5 Essential indicators cover the items below — illustrative paraphrases; the SEBI BRSR format itself is the authoritative source for the exact wording and reporting structure of each indicator. Reporting structure varies by indicator (some entity-level, some cohort-disaggregated):

• Training on human-rights issues — % of employees and workers trained, separately for each cohort and for skill category where applicable
• Minimum-wage compliance — % of employees and workers, gender-disaggregated, paid above the applicable minimum wage; the basis applied (which underlying statute and jurisdiction notification) disclosed alongside
• Median remuneration / wages — median annual remuneration with male / female ratios, disaggregated by cohort (employees and workers). This is a native P5 disclosure with its own reporting structure; it draws on the same payroll source data as the P3 Female Wages Core attribute but presents the data as median ratios rather than aggregate wage-bill share — both can coexist in the same BRSR
• Gross wages paid to females — also reported here as a native P5 disclosure, with the same source-data overlap with the P3 Core attribute
• Complaints disclosed across categories — sexual harassment (under POSH Act, also feeding the P3 POSH Core attribute), discrimination at workplace, child labour, forced / involuntary labour, wages, other workplace-rights complaints
• Mechanisms to prevent and address adverse impacts — disclosure of policy and grievance-redressal channels available to employees, workers, and (where applicable) value-chain partners
• Coverage by Internal Committee under POSH Act — reaffirms the IC composition disclosure (also under P3)
• Assessment of own operations — % of plants / offices assessed for human-rights risks (child labour, forced labour, sexual harassment, discrimination, wages, other) during the reporting year

The wages, remuneration, and complaints disclosures above are native P5 disclosures with their own reporting structures under Principle 5 — they are not P3 disclosures repackaged. The same source documents (payroll register, IC register) feed both principles, which is why P5’s audit-trail is intertwined with P3’s; workpaper reconciliation across the two principles avoids duplicate extraction effort during the assurance window.

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The Leadership indicators (Top 1,000 listed entities)

The Leadership indicators below are part of the BRSR format for the Top 1,000 listed entities, and voluntary for entities outside the Top 1,000.

For several Leadership items, the entity must make an applicability judgement on scope before responding — the value-chain partner assessment depends on which partners the entity considers in scope for human-rights review during the year; the disability-inclusion items depend on the relevant facility population. Where applicability or scope judgement is involved, the disclosure includes both the response itself and the documented basis for the applicability call — and the assurance evidence burden is on that basis, not only on the final number. A “not applicable” or a partial-scope response without a substantiated applicability rationale is a routine assurance follow-up.

Leadership indicators (illustrative paraphrases):

1. Process to address adverse impacts — extending the Essential disclosure with the entity’s documented escalation and remediation process
2. Scope of human-rights due diligence — entity’s documented due-diligence process and its scope (own operations + value chain), including any third-party assessments
3. Accessibility of premises and offices to differently-abled persons — beyond statutory compliance under the Rights of Persons with Disabilities Act, 2016
4. Equal-opportunity policy details — specific elements such as recruitment, promotion, transfers, retirement, grievance handling
5. Value-chain partner assessment — % of value-chain partners (entity defines the in-scope population, e.g., by spend threshold or strategic importance) assessed for human-rights risks, with corrective actions taken on findings
6. Disability inclusion and aids — facilities provided beyond statutory minima

The value-chain partner assessment Leadership indicator is the single most-cited P5 disclosure for BRSR-Core-engaged entities — it is the place in BRSR where supplier human-rights expectations get formally documented, and it is the most direct narrative link between BRSR Core (which covers the listed entity itself) and the BRSR Value Chain Verification scope (which covers SME suppliers).

Leadership indicators are not part of BRSR Core assurance scope but form the qualitative narrative around the assured numbers. A “not applicable” against a Leadership indicator that involves applicability judgement is something the assurance partner will want to see substantiated in the entity’s documentation.

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How Principle 5 sits in the BRSR Core landscape

None of the nine BRSR Core KPIs sits under Principle 5. That is a feature of how the BRSR Core subset was scoped, not a statement that Principle 5 is less important than other principles — Principle 5 carries substantial native disclosures of its own, including the value-chain partner assessment that underpins much of the Indian Top-1,000 ESG-rating narrative.

The nine Core KPIs are clustered under:

Principle	Core KPIs
P6 — Environment	GHG intensity, water intensity, energy intensity, waste recycled (4 KPIs — see P6 pillar)
P3 — Employee Wellbeing	Wellbeing spend, Female Wages, POSH Complaints (3 KPIs — see P3 pillar)
P8 — Inclusive Growth	Job Creation in Smaller Towns (1 KPI — to be covered when the P8 pillar publishes)
P9 / P1	Openness — % revenue with related parties (1 KPI — classification varies by reference)

What this means in practice: three P5 native disclosures share underlying source documents with P3 Core KPIs, even though the P5 disclosures themselves are not in the BRSR Core reasonable-assurance scope:

• POSH complaints (native P5 disclosure) uses the same IC register as the P3 POSH Core KPI
• Median remuneration and wages-to-females (native P5 disclosures) use the same payroll register as the P3 Female Wages Core KPI — sliced as median ratios for P5 and as aggregate wage-bill share for P3
• Complaints register (native P5 disclosure) is the same log as the broader P3 grievance-redressal disclosure

Workpaper reconciliation across P5 Essentials and P3 Core attributes is a pre-engagement-coordination win — set up the IC register and payroll register pulls once, slice for both principles, avoid redundant data extraction during the assurance window.

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Source-document evidence

The full evidence-document inventory is on Document Evidence Requirements. For Principle 5 specifically, evidence overlaps with P3 and adds value-chain documentation:

Wage and remuneration disclosure

• Audited payroll register — minimum-wage compliance verification, median-remuneration calculation, gender-split (also supports the Female Wages Core attribute)
• Applicable minimum-wage notifications for the operating jurisdictions during the reporting period — the entity should retain the source notifications and disclose which statute / framework was applied for which jurisdiction
• HR master records — gender, contract type, skill category, jurisdiction mapping

Complaints (overlaps with P3)

• IC register and meeting minutes under the POSH Act for the reporting year (also feeds the P3 POSH Core attribute)
• Broader grievance log covering discrimination, child labour, forced labour, wages, and other workplace-rights complaints
• External-counsel correspondence on human-rights matters during the year
• Industrial relations records — any disputes, settlements, or proceedings during the year that touch human-rights themes

Human-rights training

• Training attendance registers for human-rights training, by cohort and category
• Training content / curriculum reference (often the same as POSH-awareness modules, expanded to cover discrimination, child labour, forced labour)

Assessment of own operations

• Internal audit reports or self-assessment questionnaires covering plants and offices for human-rights risks
• Any third-party assessment reports (SA8000 audits, customer-driven supplier assessments where the entity is the supplier)

Value-chain partner assessment (Leadership)

• Vendor / supplier human-rights self-assessment questionnaire responses
• The entity’s documented in-scope partner definition and basis for the population (spend threshold, strategic importance, geography, sector risk)
• Corrective-action records where findings were raised

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Sector context

Sector	P5 emphasis
IT services, BPO, KPO	Privacy and dignity at work (POSH overlap), data-handling employee policies (where data subjects are end customers — privacy as a human-rights dimension), value-chain partner assessment is light (limited supply chain)
Manufacturing, cement, steel	Worker safety + bonded / contract labour (the contractor / direct-employment classification choice from P3 carries forward), value-chain partner assessment is material (raw-material suppliers, logistics)
Banking, NBFCs	Customer privacy + data dignity, employee dignity (POSH heavy), branch-network value-chain assessment usually narrow
FMCG, Pharma, retail	Mixed — corporate office (employees) + plant/distribution (workers, often contractor), agricultural / API supply-chain partner assessment material, customer-data dignity for direct-to-consumer brands
Public infrastructure, utilities	Statutory entities operating with contractor workforces — same boundary call as in P3, plus engagement with affected communities under leadership indicators

The sector-specific industry guides (in /industries/) cover the operational nuances per sector — those publish over Phase C Weeks 7-8.

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Common audit findings

Common practice patterns observed in BRSR assurance engagements — not SEBI-recognised categories of finding:

1. Minimum-wage basis not disclosed. The disclosure reports a percentage above minimum wage without stating which underlying statute or jurisdiction notification was applied — particularly relevant given the transitional state of the Indian wage-law framework (older statutes vs the Code on Wages, 2019, with phased operationalisation across jurisdictions). The entity should disclose the basis applied for each operating jurisdiction.
2. Gender-disaggregated minimum-wage data missing for workers cohort. Direct-employment payroll typically captures gender; contractor-engaged workers’ gender often sits in the contractor’s records (or nowhere). Reconciliation through the contractor or via documented entity self-assessment is the path.
3. Complaints scope overlap with P3 not reconciled. The P5 complaints disclosure and the P3 POSH disclosure pull from the same IC register but slice differently. Failing to reconcile (different totals, different categorisations) is a routine cross-disclosure inconsistency.
4. Median-remuneration ratio confusion. The P5 indicator typically asks for the median male : median female remuneration ratio, which is a different metric from the P3 Female Wages share (share of total wage-bill paid to females). Both can coexist in the same BRSR; conflating them in narrative is a frequent reader-confusion source.
5. Value-chain partner population definition undisclosed. The Leadership indicator on value-chain assessment asks for % of partners assessed; the entity reports a percentage without disclosing the underlying in-scope partner population definition (spend threshold, strategic-importance criterion, geography, sector risk). The denominator definition is what makes the percentage interpretable, and the BRSR format explicitly asks for partner assessment and corrective actions, which makes the basis essential.
6. Assessment-of-own-operations methodology undisclosed. % of plants / offices assessed during the year is reported, but the assessment methodology (internal audit, third-party, self-assessment questionnaire) is not consistently described — making cross-year comparability difficult.
7. Human-rights training conflated with POSH-awareness training. Some entities count POSH-awareness completion as full human-rights training, inflating the human-rights training coverage indicator. POSH awareness is a subset; broader human-rights coverage requires content on discrimination, child labour, forced labour, and grievance mechanisms.

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How P5 rolls up into the BRSR Core engagement

P5 has no BRSR Core attribute of its own. The signed BRSR Core assurance opinion does not directly attest P5 disclosures.

However, three P5 Essential indicators share underlying audit-trails with P3 BRSR Core attributes — POSH complaints, median remuneration / female wages, and the broader complaints register. The BRSR Core engagement workpapers for the P3 attributes typically support the P5 Essential disclosures as a by-product, even though the P5 disclosures themselves are not in the assurance scope.

Many entities ask the assurance partner to apply limited-assurance procedures over selected P5 Leadership disclosures — particularly the value-chain partner assessment indicator, which feeds investor / lender ESG-rating expectations. This extended scope is engagement-letter-driven rather than mandatory under BRSR Core.

For SME suppliers being asked by their Top-1,000 listed customer to provide assured human-rights data as part of the customer’s value-chain disclosure, see BRSR Value Chain Verification — this is the mechanism by which the listed customer’s P5 Leadership indicator on value-chain assessment becomes a SME-supplier engagement.

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Related reading

• NGRBC Principle 3 — Wellbeing of Employees — sibling pillar with significant data overlap (POSH, female wages, complaints)
• POSH Complaints Disclosure — P3 Core attribute also feeding P5 complaints essential
• Female Wages as % of Total Wages — P3 Core attribute also informing P5 median-remuneration disclosure
• NGRBC Principle 6 — Environment — sibling pillar (independent of P5 but shared materiality framework)
• Document Evidence Requirements — full per-attribute evidence checklist
• NGRBC to BRSR Metric Mapping — full P1–P9 to BRSR-format metric crosswalk
• BRSR Core Assurance — service
• BRSR Value Chain Verification — service