Financial glossary
Finance terms, defined. Each entry includes a formula where applicable and a real Indian example.
The Paris Agreement aim of limiting global warming to 1.5°C above pre-industrial levels.
An RBI-regulated framework for secure, consent-based financial data sharing between financial institutions.
Climate risk from sudden extreme events, such as cyclones, floods, heatwaves and wildfires.
The test of whether an emission reduction would have happened anyway without the money from selling carbon credits.
The extent to which an investment causes impact that would not have happened without it.
An audit opinion stating that the financial statements as a whole are materially misstated and do not give a true and fair view.
A regular report showing how much of a labelled bond's or deposit's money has been spent, on which projects or categories, and how much remains unallocated.
Excess return of an investment relative to its expected return based on risk (beta). Measures manager skill.
Orders placed after trading hours for the next trading day.
Date when company board announces corporate actions like dividend/bonus.
A deal made on the same terms that two unrelated parties would agree to in the open market.
The part of the Paris Agreement that allows countries to cooperate on emission cuts, including by trading carbon credits.
A third-party check of BRSR Core data under standards developed by the Industry Standards Forum, allowed by SEBI as an alternative to assurance.
The split of a portfolio across asset classes such as equity, debt, and gold. It is set by goals, horizon, and risk tolerance rather than market views.
Measures how efficiently a company uses its assets to generate revenue. Higher ratio indicates better efficiency.
A volatility indicator that measures the average range of price movement over a period, considering gaps.
The share of a borrower's or investee's emissions that a lender or investor counts as its own, based on its share of the company's financing.
Process to settle trades when a seller fails to deliver shares (Short Delivery).
The board committee that oversees financial reporting, auditors, internal controls and related-party deals.
The rule that limits how long the same auditor can audit a company.
Emissions that a product or service helps others avoid, compared with a reference case, such as the emissions saved when a customer replaces a diesel generator with solar power.
A trading system that sets a benchmark for each participant and issues credits to those that beat it, which others can buy to cover a shortfall.
One hundredth of a percentage point. Interest rates, yields, spreads, and expense ratios are quoted in basis points to avoid ambiguity.
Selecting the companies with the best ESG performance within each sector, so that every sector stays in the portfolio.
Measures a stock's volatility relative to the broader market (Nifty 50). Indicates systematic risk.
Difference between highest buy price (Bid) and lowest sell price (Ask).
The risk to a business from the loss of plant and animal species and the ecosystems they form.
The use of concessional public or philanthropic money to lower the risk or raise the return of a project so that private investors will also fund it.
A single trade with value > ₹10 Crore or 5 lakh shares.
A green bond whose proceeds go to sustainable water management or the marine and ocean economy.
The share of a board made up of independent directors, and more broadly the board's ability to act separately from management and the promoter.
Volatility bands placed above and below a moving average. Bands widen during volatility and contract during calm periods.
Free additional shares given to existing shareholders in proportion to their holding, capitalising reserves. No cash changes hands and total value is unchanged.
Free shares given to existing shareholders based on their current holding.
Process of discovering price by inviting bids within a price band.
The net asset value of a company divided by outstanding shares. Represents theoretical value if company was liquidated.
Net worth of the company per share.
Shareholders' equity divided by the number of shares outstanding. It is the accounting net worth attributable to each share.
SEBI's earlier, shorter ESG report for listed companies, replaced by the BRSR.
The Business Responsibility and Sustainability Report: SEBI's mandatory ESG report for the top 1,000 listed companies by market capitalisation, filed as part of the annual report.
A subset of key BRSR indicators, grouped under nine attributes, that large listed companies must have independently assessed or assured.
An ESG version of the BSE 100, first launched as the S&P BSE 100 ESG Index, that excludes certain businesses and UN Global Compact violators.
Bullish: Expecting prices to rise. Bearish: Expecting prices to fall.
A company repurchasing its own shares, through a tender offer or open-market purchases, reducing share count. In India buybacks are governed by SEBI regulations.
The mean annual growth rate of an investment over a specified period longer than one year, assuming profits are reinvested at the end of each year.
An emissions trading system in which the government caps total emissions, issues allowances up to the cap, and lets companies trade them.
A bank's capital measured against its risk-weighted assets. It shows how much cushion the bank has to absorb loan losses and how much further lending it can support.
A model that describes the relationship between systematic risk and expected return, used to price risky securities.
The total amount of CO2 that can still be emitted while keeping warming below a given level, such as 1.5°C or 2°C.
A tradable certificate representing one tonne of CO2e reduced, avoided or removed from the atmosphere.
The tradable unit of India's CCTS, representing one tonne of CO2 equivalent.
The total greenhouse gas emissions caused by a company, product, activity or person, expressed in CO2e.
Greenhouse gas emissions per unit of revenue or output, used to compare companies of different sizes.
A claim that a company's or product's emissions have been fully balanced, usually by buying carbon offsets.
A carbon credit used to compensate for a company's own emissions.
Taking CO2 out of the atmosphere and storing it, through nature (such as forests and soils) or technology (such as direct air capture).
A tax set at a fixed price per tonne of greenhouse gas emitted, or on the carbon content of fuels.
A government order that requires auditors to report on specific matters, such as loans to related parties, defaults and frauds, in an annexure to the audit report.
The share of a bank's total deposits held in current and savings accounts. Current accounts pay no interest and savings accounts pay roughly 3 to 4 percent, so a high CASA ratio means the bank funds its loans with cheap money.
The cash a company actually received from its core business of selling goods and services during the year, after paying its operating costs. It excludes investing and financing flows.
The EU's charge on the carbon embedded in imports of cement, iron and steel, aluminium, fertilisers, electricity and hydrogen.
A digital form of sovereign currency issued by the RBI, piloted as the e-rupee in retail and wholesale segments. Unlike cryptocurrency, it is central-bank money.
The principle that all countries share responsibility for climate change, but richer, higher-emitting countries should do more.
India's compliance carbon market, which sets binding emission intensity targets for large plants in energy-intensive sectors.
A non-profit that runs a global disclosure system on climate, water and forests, and scores companies from A to D-.
Work that deprives children of their childhood, education or health, or that is banned for their age.
Climate risk from long-term shifts, such as rising average temperatures, sea level rise and changing rainfall.
Price bands set by exchanges (NSE/BSE) to halt trading during extreme volatility. Index-wide and stock-specific circuits exist.
Max allowed price movement in a day to check excessive volatility.
An economic model that keeps products and materials in use for as long as possible through reuse, repair, recycling and better design.
An investor-led initiative, launched in 2017, that engages the world's largest corporate greenhouse gas emitters on climate governance, emission cuts and disclosure.
A certification scheme run by the Climate Bonds Initiative that checks bonds and other debt against science-based criteria for each sector.
An official classification of which economic activities count as climate-friendly or transition activities, often with numeric thresholds.
A claim that a company removes or offsets more greenhouse gases than it emits.
A consistent description of a possible future path for emissions, policy, technology and warming, used to test climate risk.
An exercise that estimates how a bank's or insurer's losses would change under severe physical or transition climate scenarios.
An estimate of how much a company's or portfolio's value could fall under given climate scenarios.
A common unit that expresses the warming effect of any greenhouse gas as the amount of carbon dioxide with the same effect.
A carbon market created by law, in which covered companies must hold allowances or credits for their emissions.
Interest calculated on both the initial principal and the accumulated interest from previous periods. The 'eighth wonder of the world.'
A legal record of trades executed on a given day.
People who work at a company's sites but are employed through contractors or agencies rather than directly.
A measure of how serious a company's involvement is in ESG-related incidents, such as accidents, protests, fines or fraud allegations.
The yearly meeting of countries that are parties to the UN climate convention, where climate rules and targets are negotiated.
A SEBI-required ESG rating built only on assured or independently assessed data, mainly the BRSR Core indicators.
Events initiated by a company that affect its shareholders.
The system by which companies are directed and controlled, including who makes decisions, who checks them and how shareholders are protected.
S&P Global's yearly industry-specific questionnaire and assessment that produces S&P Global ESG Scores.
The return shareholders require for holding a company's shares, usually estimated as the risk-free rate plus beta times the equity risk premium, plus any company-specific premium.
The blended average interest a bank pays across all its deposits and borrowings: current accounts at 0 percent, savings at about 3 percent, fixed deposits at about 6.5 percent, and other funding.
The fixed annual interest a bond pays as a percentage of its face value. It is set at issue and does not change with the market price.
An increase in a bond's interest rate that applies if the issuer misses its sustainability performance target.
A condition attached to a loan or bond that the borrower must maintain, such as a maximum leverage ratio or minimum coverage ratio. Breaching one can trigger penalties or immediate repayment.
The rate of change in the prices of a consumption basket of goods and services. India's monetary policy targets CPI inflation at 4%, within a 2 to 6% band.
An agency's opinion of a borrower's ability to repay, expressed on a letter scale from AAA (highest safety) down to D (default). In India the main agencies include CRISIL, ICRA, CARE Ratings and India Ratings.
The extra yield a corporate bond pays over a government bond of the same maturity, compensating for default risk and lower liquidity.
The percentage of a bank's net demand and time liabilities, mostly its deposits, that it must hold as cash balances with the Reserve Bank of India. The RBI pays no interest on these balances.
A company's spending on social and environmental causes outside its core business; in India, a legal requirement for larger companies.
The board committee that sets and monitors a company's corporate social responsibility policy and spending.
The EU law that requires large companies to report sustainability information on a double materiality basis, using the ESRS.
The shortfall between a country's foreign earnings (exports, remittances) and foreign spending (imports). A persistent CAD must be financed by foreign capital inflows.
Measures a company's ability to pay short-term obligations. Compares current assets to current liabilities.
Under the DPDP Act, the person or organisation that decides why and how personal data is processed.
A measure of how much a company has borrowed for every rupee of shareholders' equity. It shows how far the business is funded by lenders rather than by its owners.
An account to hold securities (shares, bonds, ETFs) in electronic form. Managed by depositories NSDL or CDSL.
An account used to hold shares and securities in electronic format.
PAN Card, Aadhaar (Address Proof), Bank Proof (Cancelled Cheque), Photos.
Institutions that hold securities in electronic form (like a bank for shares).
Indian institutions such as mutual funds, insurers, and pension funds investing in domestic markets. Their flows are reported daily alongside FPI numbers.
An audit report in which the auditor declines to give any opinion because it could not collect enough evidence.
Policies and outcomes that aim to give people of different genders, backgrounds and abilities fair access to jobs, pay and promotion.
Selling, or refusing to buy, a company's securities for ESG reasons.
A portion of the company's profits distributed to shareholders.
The share of net profit paid out as dividends. The remainder, the retention ratio, is reinvested in the business.
The annual dividend payment divided by the stock's current price, expressed as a percentage. Shows income return on investment.
When the same emission reduction is claimed by more than one party, such as two companies or two countries.
Treating an issue as material if it passes either the financial materiality test or the impact materiality test.
A global family of best-in-class sustainability indices launched in 1999, based on S&P Global's Corporate Sustainability Assessment and renamed the Dow Jones Best-in-Class Indices from 10 February 2025.
The part of a company's value chain after its own operations, including distribution, product use and disposal.
Agent of the depository (Broker) who interacts with the investor.
India's Digital Personal Data Protection Act, 2023, which sets the rules for processing digital personal data.
Cash available for debt service divided by scheduled principal and interest payments. It measures whether operations generate enough cash to meet debt obligations as they fall due.
A measure of a bond's price sensitivity to interest-rate changes, expressed in years. Longer duration means bigger price swings when yields move.
The idea that an issue's materiality changes over time, often moving from impact-only to financially material.
Electronic voting by shareholders on company resolutions, mandatory for listed companies in India.
The inverse of the P/E ratio: earnings per share divided by price. It expresses valuation as a percentage return, making stocks directly comparable with bond yields.
Operating profitability before interest, taxes, depreciation, and amortization as a percentage of revenue.
A type of moving average that gives more weight to recent prices, making it more responsive to new information than simple moving average.
A fixed payment amount made by a borrower to a lender at a specified date each month. Includes both principal and interest components.
A number that converts an activity, such as fuel burned or electricity used, into greenhouse gas emissions.
A country's greenhouse gas emissions per unit of economic output, the main form of India's national emissions target.
A paragraph in an audit report that draws attention to an important matter already disclosed in the accounts, without changing the opinion.
The share of employees who leave a company during a year, calculated as leavers divided by average headcount.
Any arrangement that restricts a shareholder's freedom to sell shares or gives someone else a claim over them.
Energy used per unit of revenue or output, a measure of how efficiently a company uses energy.
Dialogue between investors and company management or boards to improve ESG practices, disclosure or performance.
The value of a company's whole business, belonging to both shareholders and lenders: market capitalisation plus debt, minus cash. It is roughly what it would cost to buy the business outright and settle its debts.
A policy that makes producers responsible for collecting and recycling their products and packaging at the end of their life.
The portion of a company's profit allocated to each outstanding share of common stock. A key indicator of company profitability on a per-share basis.
A tradable certificate under India's PAT scheme, representing one tonne of oil equivalent of energy saved beyond a plant's target.
A framework for analysing environmental, social and governance issues that can affect a company's cash flows, risks and cost of capital.
A firm that collects, cleans, estimates and sells ESG data on companies, often alongside ESG ratings.
A mutual fund or ETF that selects investments using environmental, social and governance criteria under a stated strategy.
Building material ESG factors into normal investment analysis, forecasts and valuation, alongside financial factors.
The change in a company's ESG rating or score over time, used by some investors to favour companies that are improving.
An opinion from a rating provider on a company's ESG performance or on the ESG risks it faces, expressed as a grade or score.
A firm that issues ESG ratings or scores; in India, one registered with SEBI under the Credit Rating Agencies Regulations, 1999.
A rating of how much ESG risk a company has left unmanaged, on an absolute scale where a lower number means lower risk.
A number, usually from 0 to 100, that sums up a company's performance across a set of environmental, social and governance indicators.
A scheme that gives employees the right to buy company shares at a set price after a waiting period.
The reporting standards that companies use under the EU's CSRD.
ESG figures modelled by a data provider when a company has not disclosed them, for example estimated emissions based on industry averages.
A voluntary EU label, applying from 21 December 2024, for green bonds that put at least 85% of their proceeds into EU Taxonomy-aligned activities.
The EU's classification system that defines which economic activities count as environmentally sustainable.
Enterprise Value divided by EBITDA. A valuation metric that compares total company value to operating earnings.
A multiple comparing firm value to revenue. Used when earnings are negative or temporarily depressed, since revenue is harder to manipulate than profit.
An investment strategy built mainly on negative screening, which avoids named sectors, activities or companies.
The annual fee charged by a mutual fund to manage your money, expressed as a percentage of assets.
The nominal value of a share as stated in the company's charter. Used for accounting purposes and calculating dividends.
The original value of a share as listed in the company's books.
Emissions linked to capital market deals that a bank arranges or underwrites, such as bond and share issues, rather than funds on its own balance sheet.
Work-related deaths, reported as a count or per a set number of hours worked.
Free cash flow per share divided by the share price, or firm-level free cash flow divided by market cap. It shows the cash return the business generates on its current price.
Horizontal lines indicating potential support/resistance at key Fibonacci ratios before price continues in original direction.
The share of borrowers' and investees' greenhouse gas emissions that is attributed to a bank, insurer or investor that funds them.
Access to affordable and useful financial services, such as accounts, credit, insurance and payments, for people and small businesses that have been underserved.
An ESG issue is financially material if it could affect a company's cash flows, risk or cost of capital.
Money in a deal that agrees to absorb the first losses if the project performs badly, which protects the investors ranked above it.
The gap between government spending and its revenues, financed by borrowing. Expressed as a percentage of GDP in the Union Budget.
A framework from the Impact Management Project that describes any impact by what outcome occurs, who experiences it, how much change there is, the contribution of the activity and the risk that it differs from expectations.
Work done under threat or coercion, which the worker has not freely agreed to, including bonded labour tied to debt.
The four headings under which climate and sustainability risks are disclosed: governance, strategy, risk management, and metrics and targets.
Overseas institutions and funds registered with SEBI to invest in Indian listed securities. Their daily buy and sell figures are published by the exchanges.
Already listed company issues new shares to public.
The part of a company's shares that is available for trading in the market. It leaves out shares held by promoters and by other holders unlikely to sell, such as strategic investors, and shares that are locked in.
Market cap calculated using only shares available for public trading.
The right of communities, especially indigenous and tribal peoples, to give or withhold consent to a project that affects them, freely, before it begins and with full information.
What a sum invested today will be worth at a future date, given a rate of return and the way that return compounds.
When a stock opens significantly lower than yesterday's close.
When a stock opens significantly higher than yesterday's close.
The rate of change in the total value of goods and services produced in the economy, reported quarterly in real (inflation-adjusted) terms.
The difference between the median pay of men and women, as a percentage of men's median pay.
A coalition of financial institutions launched in 2021 to speed the move to a net zero economy, which restructured at the start of 2025.
A plant-specific target for greenhouse gas emissions per unit of output, set under India's CCTS.
The most widely used global standards for measuring and reporting greenhouse gas emissions, developed by the World Resources Institute and the World Business Council for Sustainable Development.
A person who earns from short tasks outside a traditional employment relationship, often through a digital platform such as a delivery or ride-hailing app.
A review under the Paris Agreement, held every five years, of collective progress towards its climate goals.
A measure of how much heat a greenhouse gas traps compared with carbon dioxide over a set period, usually 100 years.
A bond whose proceeds must be used for defined environmental or climate projects, such as renewable energy, clean transport or green buildings.
An Indian scheme that awards green credits for voluntary environmental actions, such as planting trees on degraded forest land.
An interest-bearing fixed deposit at a bank or NBFC whose proceeds are earmarked for green lending or investment.
An infrastructure investment trust that owns renewable energy or other green infrastructure assets and pays out most of their cash flows to unitholders.
A loan whose money must be used for eligible green projects, with tracking and reporting similar to a green bond.
Deliberately saying little or nothing about climate targets or progress, to avoid scrutiny or criticism.
The yield discount on a green bond compared with an otherwise identical conventional bond from the same issuer.
Making a company, product or investment look better for the environment than it really is.
The organisation behind the GRI Standards, the most widely used framework for reporting a company's impacts on the economy, environment and people.
Gross profit as a percentage of revenue: what remains after direct production costs, before operating expenses.
India's unified indirect tax replacing multiple taxes. Has three components: CGST (Central), SGST (State), IGST (Inter-state).
Waste that can harm health or the environment because it is toxic, flammable, corrosive or reactive.
The skills, knowledge, health and experience of a company's workforce, treated as a source of value.
An ongoing process to identify, prevent, reduce and account for harm to people linked to a company's operations and value chain.
Voluntary guidelines, first published in 2014 by a group of market participants supported by the International Capital Market Association, that set the global baseline for green bonds.
The ISSB standard on general requirements for disclosing sustainability-related financial information.
The ISSB standard on climate-related disclosures.
Investing with the intention to generate positive, measurable social and environmental impact alongside a financial return.
An issue is impact-material if the company has a significant effect on people or the environment through it.
A report on the environmental or social results achieved with a labelled bond, loan or deposit, such as emissions avoided or people served.
Claiming measurable social or environmental impact without evidence, or for results that would have happened anyway.
An estimate, in degrees Celsius, of the global warming that would result if the whole economy emitted like a given company or portfolio.
A non-executive director with no material relationship with the company, its promoters or its management that could affect their judgement.
An external firm that SEBI requires issuers of listed green and ESG debt securities to appoint to confirm that the bond meets the label's rules.
Benchmark tracking the performance of a group of stocks.
A forum of the industry bodies ASSOCHAM, CII and FICCI that develops standards for BRSR Core assessments, in consultation with SEBI.
A rating approach that judges a company against peers in its own industry rather than against all companies.
Trading in a company's shares while holding unpublished price sensitive information about it.
A reporting approach that explains how a company creates value over time using six types of capital, not just financial capital.
How many times a company's operating profit covers the interest it must pay. The higher the number, the more easily the company can service its debt.
A price per tonne of emissions that a company uses in its own decisions, even where no external carbon price applies.
The policies and procedures a company uses to make sure its financial reporting is reliable and its assets are protected.
The degree to which different sustainability reporting frameworks can be used together without duplicating work.
Retail (Small), HNI (High Net Worth), DII (Domestic Institutions), FII (Foreign Institutions).
The UN body that assesses the science of climate change and publishes major reports for policy makers.
The day shares start trading on the exchange.
IPO: Fresh shares issued (Money to company). OFS: Existing shareholders sell (Money to seller).
The GIIN's free system of standard impact metrics, including a catalogue of metrics and core metric sets for common impact themes.
The international standard for assurance engagements on information other than historical financial statements, widely used for sustainability data.
The international standard for assurance engagements on greenhouse gas statements.
The IFRS Foundation board that sets global sustainability disclosure standards for investors.
A business model in which the rated company pays the ESG rating provider for its rating.
Moving to a low-carbon economy in a way that protects the workers and communities who depend on high-carbon industries.
An area that the auditor judged most significant in the audit, described in the audit report of listed companies.
The senior officers named by law as responsible for running a company: the CEO or managing director, whole-time directors, the company secretary and the CFO.
The mandatory identity-verification process for financial accounts, using documents such as PAN and Aadhaar, increasingly completed digitally through video or Aadhaar-based flows.
A 1997 climate treaty that set binding emission cuts for developed countries only.
India's four codes on wages, industrial relations, social security and occupational safety, which replace 29 central labour laws.
A senior independent director who leads the other independent directors, especially when the chair is not independent.
An increase in emissions elsewhere caused by a project or policy that cuts emissions in one place.
TNFD's four-step method for assessing nature-related issues: Locate, Evaluate, Assess and Prepare.
A letter in which a company reassures a lender about another entity's ability or intention to repay a loan.
The risk that companies face legal claims over their contribution to climate change, or over misleading climate disclosures.
A lighter level of independent assurance, ending in a negative conclusion that nothing came to the provider's attention to suggest the information is wrong.
A way of calculating Scope 2 emissions using the average emission factor of the grid where the electricity is used.
The number of work injuries that cause lost working time, per one million person-hours worked.
Minimum number of shares you must buy (usually in F&O or SME IPOs).
Tax on profits from selling assets held for more than 12 months (equity). Currently 12.5% for equity above ₹1.25 lakh exemption.
Profit earned from selling a stock held for more than 12 months.
The price at which the last trade occurred.
A trend-following momentum indicator showing the relationship between two exponential moving averages of a security's price.
The gap between a stock's estimated intrinsic value and its market price. Buying below intrinsic value creates a cushion against errors in the estimate.
A chart that ranks options for cutting emissions by their cost per tonne, from cheapest to most expensive.
The total market value of a company's shares: the share price multiplied by the number of shares in issue. It is what the market is paying today for the whole of the company's equity.
Total value of a company's shares.
A way of calculating Scope 2 emissions using the emission factors of the specific electricity a company has chosen to buy, including certificates and contracts.
A listed company's duty to tell the stock exchanges promptly about events that could affect its share price or investors' decisions.
A related-party transaction large enough to need shareholder approval under SEBI's rules.
The test of whether an issue matters enough to influence decisions about a company.
Mandatory annual filing with Registrar of Companies containing a company's financial statements, auditor's report, and board report.
Annual return form containing information about shareholders, directors, and company structure filed with Registrar of Companies.
Financial institution managing the IPO process.
The rule that listed companies must keep at least 25% of their shares with the public.
A green bond issued by a city or urban local body to fund projects such as sewage treatment, water supply or solar power.
A country's own climate plan and targets submitted under the Paris Agreement, updated every five years.
Risks to a business that come from its dependencies and impacts on nature, including water, land, oceans and biodiversity.
The per-unit value of a mutual fund scheme, calculated by dividing total value of all securities by number of units.
Leaving companies or sectors out of a portfolio because of what they do, such as making tobacco, weapons or thermal coal.
Interest a bank earns on its loans and investments minus the interest it pays on deposits and borrowings, expressed as a percentage of its interest-earning assets. It accounts for funds the bank could not lend out.
The percentage of revenue that remains as profit after all expenses, taxes, and costs are deducted.
A state where the greenhouse gases put into the atmosphere are balanced by the amount removed from it.
An initiative of asset managers committed to supporting the goal of net zero emissions, relaunched in February 2026 with a looser commitment.
Climate scenarios published by the Network for Greening the Financial System, a group of central banks and supervisors, widely used for financial stress tests.
Nine principles of responsible business conduct issued by India's Ministry of Corporate Affairs in 2019, on which the BRSR is built.
India's benchmark stock index comprising 50 of the largest and most liquid companies listed on NSE, representing about 65% of free-float market cap.
A stricter version of the Nifty100 ESG Index that also removes companies with weak ESG scores.
An NSE index of Nifty 100 companies, weighted by free-float market capitalisation tilted by ESG score, after excluding certain businesses and severe controversies.
An NSE index that picks the companies in each Nifty 100 sector that manage ESG risk best and have no major controversies.
The board committee that oversees appointments to the board and senior management, succession and pay policy.
A promise by a shareholder to a lender not to sell or pledge certain shares while a loan is outstanding.
Installed electricity generating capacity from sources other than fossil fuels: renewables, large hydro and nuclear.
Operating profit (EBIT) with tax removed, before any financing effects. It is the profit the business generates for all capital providers.
Excluding companies that seriously breach widely accepted international norms, such as the UN Global Compact principles on human rights, labour, environment and anti-corruption.
Air pollutants formed when fuels are burned at high temperatures, in vehicles, power plants and industrial furnaces.
A loan on which interest or principal has remained overdue for more than 90 days. Banks must classify such loans separately and provide against expected losses.
The difference between the present value of cash inflows and outflows over time. Used to analyze the profitability of an investment.
A plant or unit that must meet a legally binding greenhouse gas emission intensity target under India's CCTS.
A cumulative total of volume based on whether price closed up or down. Measures buying and selling pressure.
A single advance approval for a set of repeated related-party transactions, within stated limits, instead of approving each one separately.
The sensitivity of operating profit to changes in revenue, driven by the share of fixed costs. High fixed costs mean small revenue changes produce large profit swings.
Operating profit (EBIT) as a percentage of revenue. It captures the profitability of the core business after all operating costs but before interest and tax.
Disclosed Quantity (show less than actual) to hide intent.
Market Order (Buy at current price), Limit Order (Buy at specific price).
Compares a stock's market value to its book value. Shows how much investors are paying for the net assets of a company.
The ratio of a company's current stock price to its earnings per share. Indicates how much investors are willing to pay for each rupee of earnings.
Platforms that match individual lenders directly with borrowers, regulated in India as NBFC-P2P entities with caps on exposure per lender and borrower.
The five climate goals India announced at COP26 in Glasgow in 2021.
The 2015 international climate treaty that aims to keep warming well below 2°C and to pursue a 1.5°C limit.
An EU-defined index type whose carbon intensity is at least 50% below its parent index and falls by at least 7% a year, with fossil fuel exclusions.
Tiny particles in the air, such as PM10 and PM2.5, that can enter the lungs and bloodstream.
India's market-based scheme, from 2012, that set energy efficiency targets for large industrial plants and let them trade energy saving certificates.
A licensed intermediary that lets merchants accept many payment methods without direct bank integrations, holding funds briefly in escrow during settlement.
A global industry initiative whose standard is the most widely used method for financial institutions to measure financed, facilitated and insurance-associated emissions.
The P/E ratio divided by expected earnings growth rate. Adjusts valuation for growth expectations.
The test of whether carbon kept out of the atmosphere by a project will stay out over the long term.
Emissions or energy use per unit of physical output, such as tonnes of CO2e per tonne of steel or cement.
The risk of financial loss from the physical effects of climate change, such as floods, heatwaves, cyclones and droughts.
Shares that a promoter has given to a lender as collateral for a loan, usually a loan taken by the promoter or a promoter group company rather than by the listed company itself.
Promoters using their shares as collateral to take loans.
The Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013, which requires employers to prevent and resolve sexual harassment complaints.
Choosing companies for a portfolio because they score well on ESG criteria, rather than leaving out poor performers.
Session from 9:00 AM to 9:15 AM to stabilize opening price.
The current worth of a future sum of money given a specified rate of return. It's the reverse of future value calculation.
A UN-supported global network of investors, launched in 2006, whose signatories commit to six principles of responsible investment.
The price range within which investors can bid for IPO shares.
How IPO price is finalized based on bids received.
Share prices are determined by supply and demand in the market.
Allows companies to raise capital for growth and expansion.
A company's responsibility to make sure its products do not harm the people who use them.
The person or group that controls a company, usually its founder, a business group, a parent company or the government.
The promoter together with close relatives and the companies, firms and trusts the promoter controls.
The percentage of a company's shares owned by its promoter and promoter group: the founders, controlling family or parent company, and the people and entities connected to them.
Detailed document describing the company, risks, and financials for IPO.
Money a bank sets aside from its income against loans it doubts will be repaid. Provisions are charged to the profit and loss statement before profit is struck.
A firm that analyses shareholder resolutions and recommends how institutional investors should vote.
Voting on shareholder resolutions, usually by an institution on behalf of its clients, without attending the meeting in person.
An audit opinion stating that the accounts are fair "except for" specific items that are wrong or could not be verified.
A stricter liquidity measure that excludes inventory from current assets. Shows ability to meet obligations without selling inventory.
Disagreement between ESG rating providers about the same company.
The actual return on investment after adjusting for inflation. Shows the true purchasing power gained.
A high level of independent assurance, close to a financial audit, ending in a positive opinion on the information.
Periodically restoring a portfolio to its target allocation by trimming what has grown and adding to what has lagged.
The cut-off date to determine which shareholders are eligible for dividends/bonus.
Any deal between a company and a related party, such as its promoters, directors, key managers, their relatives or the entities they control.
A tradable certificate representing one MWh of electricity generated from renewable sources.
Legal requirements for large electricity users to get a minimum share of their power from renewable sources.
The interest rate at which the Reserve Bank of India lends short-term money to banks against government securities. It is the RBI's main policy rate, set by the Monetary Policy Committee.
Measures to move people displaced by a project and restore or improve their homes, livelihoods and living standards.
Selling and promoting products honestly, without misleading claims, pressure tactics or improper inducements.
The rate at which banks park surplus funds with the RBI. Together with the repo rate it forms the corridor within which overnight market rates move.
An offer to existing shareholders to buy new shares, usually below the market price, in proportion to their holding. It raises fresh capital for the company.
Old physical floor trading method (now replaced by electronic).
The board committee that oversees the company's risk framework, required for the top 1,000 listed companies.
Indicates how efficiently a company uses its assets to generate profit. Shows how much profit is generated for every rupee of assets.
A measure of how efficiently a company uses its total capital (equity + debt) to generate profits. Better for comparing capital-intensive businesses.
Return on equity: net profit as a percentage of shareholders' equity. It shows how much profit a company earns on the money its shareholders have put in and left in the business.
After-tax operating profit divided by the total capital invested in the business, both debt and equity. It measures how well the company converts all its capital into operating profit.
A momentum oscillator that measures the speed and magnitude of recent price changes. Oscillates between 0 and 100.
A simple way to estimate how long it takes for an investment to double at a given annual interest rate.
Industry-specific standards that set out the sustainability topics most likely to affect financial performance in each of 77 industries.
A bank deposit account that provides modest interest.
A shareholder vote on executive pay.
The list in the Companies Act of activities on which companies can spend their CSR money, and the funds to which unspent amounts can go.
An emissions reduction target consistent with what climate science says is needed to meet the Paris Agreement goals.
Direct greenhouse gas emissions from sources a company owns or controls.
Indirect emissions from the electricity, steam, heat or cooling a company buys.
All other indirect emissions in a company's value chain, from suppliers upstream to customers downstream.
Regulations governing public issues (IPOs), rights issues, preferential allotments, and QIPs. Sets eligibility and disclosure requirements.
SEBI regulations that govern how listed companies must report data, maintain corporate governance, and disclose material information.
SEBI regulations that prohibit trading by insiders with unpublished price-sensitive information (UPSI). Covers designated persons and relatives.
The 'Takeover Code' governing acquisition of substantial shares, open offers, and change of control in listed companies.
An independent assessment, issued before a bond is sold, of whether the issuer's green, social or sustainability-linked framework is aligned with recognised principles.
A popular income tax deduction under the Old Tax Regime for investments up to ₹1.5 lakh in specified instruments.
Indices tracking specific sectors.
Primary Market (New securities issued) and Secondary Market (Existing securities traded).
ESG information that a company discloses about itself, for example in its BRSR, annual report or sustainability report.
The date when ownership is transferred and funds are exchanged.
The EU rules on sustainability disclosures by fund managers and other financial market participants.
Dividing existing shares into multiple shares to increase liquidity and reduce price per share.
Shareholders using their rights to push a company to change its strategy, governance or management.
The view that a company's main purpose is to maximise value for its shareholders.
Risk-adjusted return measure showing excess return per unit of total risk (standard deviation).
Selling shares you don't own, hoping to buy them back lower.
Interest calculated only on the principal amount. Unlike compound interest, it doesn't earn interest on accumulated interest.
A method of investing a fixed sum regularly in mutual funds. It automates investing and leverages rupee cost averaging.
The share of deposits banks must invest in approved securities, chiefly government bonds. It ensures bank liquidity and a captive market for government debt.
A bond whose proceeds fund projects with clear social benefits for a defined target population, such as affordable housing, healthcare or loans to small businesses.
A qualified professional who independently assesses the impact reports of non-profits that raise money on a Social Stock Exchange.
The ongoing acceptance of a company or project by local communities and other stakeholders, beyond its legal permits.
A SEBI-regulated segment of NSE and BSE where non-profits and social enterprises raise funds for social projects, with standard disclosure and assessed impact reports.
Overstating a company's or fund's social credentials, such as labour standards, diversity or community benefits.
A green bond issued by a national government, with an amount equal to the proceeds allocated to eligible green public spending.
Air pollutants, mainly sulphur dioxide, released when fuels containing sulphur, such as coal and heavy oil, are burned.
ICAI's new Standard on Sustainability Assurance, aligned with the IAASB's ISSA 5000, applying from 1 April 2027.
ICAI's current standard for assurance engagements on sustainability information, used by Indian chartered accountants.
Any person or group that affects, or is affected by, a company's activities.
The view that companies should serve the interests of all their stakeholders, not only shareholders.
The board committee that handles complaints and service issues of shareholders and other security holders.
A measure of the dispersion of returns around the average. Higher standard deviation means higher volatility/risk.
Tax on profits from selling assets held for less than 12 months (equity) or less than 24/36 months (other assets).
A set of principles asking institutional investors to act as responsible owners of the companies they invest in.
A momentum indicator comparing a security's closing price to its price range over a given time period.
Dividing each share into several shares of lower face value. Count rises, price falls proportionately, and value is unchanged.
An order to sell automatically if price drops to a certain level to limit loss.
An asset that loses value earlier than expected, or must be retired early, because of changes such as climate policy, new technology or falling demand.
A tax levied on every purchase and sale of securities (equity shares, derivatives, mutual funds) on recognized stock exchanges.
A business model in which investors and other subscribers, not the rated company, pay for ESG ratings.
Shares that carry more votes per share than ordinary shares, allowed for some founder-led technology companies.
An inspection of a supplier's site and records to check working conditions, safety and environmental compliance against a buyer's standards.
Meeting today's needs without reducing the ability of future generations to meet theirs.
A bond whose proceeds fund a mix of green and social projects under a single framework.
A key performance indicator, such as emissions intensity or renewable energy share, that a sustainability-linked bond or loan is tied to.
The level a sustainability KPI must reach by a set observation date under a sustainability-linked bond or loan.
A general-purpose bond whose financial terms, usually the coupon, change depending on whether the issuer meets predefined sustainability targets.
A bank loan whose interest margin moves up or down depending on whether the borrower meets agreed sustainability targets.
Seventeen goals adopted by UN member countries in 2015 as part of the 2030 Agenda for Sustainable Development.
Settlement cycle where trade-related settlements happen within 24 hours of the transaction. India moved to T+1 in 2023.
A task force set up by the Financial Stability Board that created the four-pillar framework for climate disclosure.
The value of all cash flows beyond the explicit forecast period in a DCF, usually estimated with the Gordon growth formula. It typically accounts for the majority of a DCF's total value.
Investing in companies whose business serves a sustainability theme, such as clean energy, water, electric mobility or healthcare access.
A map of how an activity is expected to lead to a desired change, from inputs and activities to outputs, outcomes and long-term impact.
A taskforce that developed a framework for disclosing nature-related dependencies, impacts, risks and opportunities.
Top Line refers to Revenue/Sales. Bottom Line refers to Net Profit.
The number of recordable work injuries, including those without lost time, per 2,00,000 hours worked.
An account used to place buy and sell orders in the stock market.
Electronic system where orders are matched automatically.
The period during which a company's designated persons are allowed to trade in its shares.
A use-of-proceeds bond that funds projects to cut emissions in high-emitting activities that cannot yet become fully green.
One of SEBI's required rating products, measuring the speed and size of a company's efforts and investment towards net zero and its improvement over time.
The risk of financial loss from the move to a low-carbon economy, through policy, technology, market or reputation changes.
Studying historical price movements to predict future direction.
Risk-adjusted return measure using beta (systematic risk) instead of total risk. Better for diversified portfolios.
An approach that measures company performance on three dimensions: people, planet and profit.
The global standard, endorsed by the UN Human Rights Council in June 2011, that sets out the duties of states and the responsibilities of businesses on human rights.
Institution guaranteeing to buy unsold shares in an IPO.
The 1992 UN treaty that sets the overall framework for international climate negotiations.
A "clean" audit opinion stating that the financial statements give a true and fair view.
A special bank account into which a company must move CSR money allocated to ongoing projects but not yet spent.
India's real-time, interoperable bank-to-bank payment system operated by NPCI. It lets any app move money instantly between accounts using simple identifiers.
Information about a company that is not yet public and would likely move its share price if it were.
The part of a company's value chain before its own operations, including suppliers and raw materials.
The rule that the money raised from a labelled bond or loan must go only to eligible projects described in its framework.
All the activities and partners involved in making and delivering a product, from raw materials to end use and disposal.
Under SEBI's rules, a top supplier or customer that individually makes up 2% or more of a company's purchases or sales by value.
A government capital grant that covers part of a project's cost so that it becomes commercially viable for private developers.
A company's formal whistleblower system, through which directors and employees can report genuine concerns.
Total number of shares traded in a specified period.
A market in which companies and individuals buy carbon credits by choice, usually to support climate claims.
Weighted average cost of capital: the average return a company must earn on its capital to satisfy both its lenders and its shareholders, weighted by how much of each it uses.
Water that a company withdraws and does not return, roughly withdrawal minus discharge.
A condition in which demand for water in an area is high compared with the available supply.
The total water a company takes in from all sources, such as rivers, groundwater, third-party supply and the sea.
A portfolio's exposure to carbon-intensive companies, calculated as the portfolio-weighted average of each holding's emissions per unit of revenue.
A borrower that does not repay a bank loan despite being able to, or that diverts or siphons off the borrowed money.
The number of days cash stays locked in operations: inventory days plus receivable days minus payable days.
An index of prices at the wholesale level, weighted toward manufactured goods and commodities. It often diverges from CPI, which tracks consumer prices.
The annualised return of a series of cash flows on irregular dates, solved so their present values sum to zero. It is the correct return measure for SIPs and staggered investments.
An Indian sub-category of green bond whose proceeds go to solar energy generation and the industries linked to it.
The single discount rate at which a bond's future coupons and principal repayment equal its current market price. It is the total annualised return from holding the bond to maturity.
A listed security issued by a non-profit on a Social Stock Exchange that pays no interest and returns no principal, so it works as a donation.
A water treatment approach in which a plant recycles all its wastewater and discharges no liquid effluent.