There will be special auditing on compliance with environmental, social and governance rules, CAG will tighten the screws on government companies.:

News Topical, Digital Desk : In a significant move, the Comptroller and Auditor General (CAG) has prepared for a special audit of the top 30 public sector companies (PSUs) listed on the Indian stock exchange.

The audit, primarily aimed at assessing compliance with environmental, social and governance (ESG) standards, will also include a thorough examination of 18 unlisted government companies.

CAG will specifically look at how diligent government companies are in following environmental rules. Under Environment, the companies' carbon emissions, water management, forest conservation and pollution control policies will be examined.

The S (Social) aspect is likely to evaluate employee welfare, gender equality, and community development schemes. The G (Governance) aspect will look at board structure, corruption prevention, and financial transparency.

The CAG clarified that the audit will be conducted through digital tools and third-party verification, and the report will be submitted to the Public Accounts Committee of Parliament. This announcement comes at a time of growing global pressure on ESG compliance in India.

ESG disclosures are mandatory for the top 1,000 listed companies under SEBI's Business Responsibility and Sustainability Reporting Framework. However, many PSUs are exempt.

A CAG report in July 2025 revealed that 20 major PSUs lacked women directors and had flawed board structures, raising questions about their corporate governance.

Deputy CAG AM Bajaj said that such auditing would increase transparency in government companies and improve their governance record. It could also prove to be a milestone in strengthening India's Sustainable Development Goals.

Such a move would prove that the CAG is playing a vital role in bringing about better governance in the country. Bajaj did not name these companies, but they would include major companies like SBI, ONGC, NTPC, BPCL, and Coal India. Many of these companies are involved in the energy sector, which is considered highly sensitive to environmental concerns.

These companies already take full environmental care, but scrutiny by a constitutional agency like the CAG will further increase their vigilance. The 18 unlisted companies will primarily be units in the energy, mining, and defense sectors, along with some state-level coal producers and hydropower projects.