Corporate Accountability in the Green Era: Legal Imperatives for Sustainable Business Practices*

Abstract

The contemporary global environmental crisis has transformed the discourse on corporate responsibility, shifting it from voluntary Corporate Social Responsibility (CSR) to legally enforceable Corporate Environmental Responsibility (CER). This paper critically examines the evolution of corporate accountability in the context of sustainability, tracing its development through international milestones such as the Brundtland Report (1987), Rio Declaration (1992), and Paris Agreement (2015). In India, this evolution has taken a distinctive legal trajectory through Section 135 of the Companies Act, 2013, the Securities and Exchange Board of India’s (SEBI) Business Responsibility and Sustainability Report (BRSR) framework, and the proactive role of the National Green Tribunal (NGT). Landmark judicial decisions, including Vellore Citizens’ Welfare Forum v. Union of India and M.C. Mehta v. Union of India, have further constitutionalized environmental protection, embedding the principles of sustainable development, precautionary principle, and polluter pays within corporate accountability. The study argues for strengthening legal imperatives through mandatory ESG audits, recognition of environmental harm in corporate liability, and incentives for green innovation. It concludes that the future of corporate governance lies in integrating ecological consciousness into strategic decision-making, ensuring that profitability aligns with planetary responsibility. Sustainable business, therefore, is no longer optional but a legal and moral necessity for corporate legitimacy and survival in the 21st century.