Thiruvananthapuram, October 7, 2025: Kerala has taken a pioneering step toward responsible industrial growth by approving a comprehensive Environmental, Social, and Governance (ESG) Policy, which officials and media describe as the first of its kind among Indian states.
The policy, cleared by the State Cabinet this week, seeks to make Kerala a hub for sustainable, socially conscious, and transparent industries. It is designed to attract responsible investments and encourage enterprises that align with global ESG benchmarks.
According to Industries Minister P. Rajeeve, the initiative rests on the principles of Nature, People, and Industry, with a vision to promote low-polluting, resource-efficient businesses. To incentivize compliance, the government has announced a range of benefits, including subsidies, concessional loans, tax reimbursements, and preferential treatment in public procurement for ESG-certified enterprises.
The Kerala State Industrial Development Corporation (KSIDC) will serve as the nodal agency to guide implementation and support industries in transitioning toward sustainable practices. The policy also outlines a plan to achieve 100 per cent renewable energy by 2040 and carbon neutrality by 2050, in alignment with global sustainability goals.
The state’s ESG framework will draw from established global standards such as the Global Reporting Initiative (GRI) and Sustainability Accounting Standards Board (SASB) metrics, ensuring consistency with international best practices.
In addition to approving the ESG policy, the Cabinet also endorsed complementary measures to promote green investments, including the waiver of the advance payment guarantee for the proposed Wayanad Township project.
Kerala’s move signals a strategic effort to integrate sustainability into its industrial policy, aiming to balance economic growth with environmental protection and social responsibility—an approach that could set a model for other states to follow.
