How do the 2% and 75% value chain thresholds work in SEBI's own example?

An example in the Securities and Exchange Board of India (SEBI) Frequently Asked Questions (FAQ) on the Business Responsibility and Sustainability Report (BRSR) has purchases of rupees (Rs) 1,000 crore and sales of Rs 800 crore. Suppliers A to G reach 2% or more, but the entity may stop at A to D, which cover 75%..

The rule, in SEBI's words

The SEBI circular of 28 March 2025 says value chain shall encompass the top upstream and downstream partners of a listed entity, individually comprising 2% or more of the listed entity's purchases and sales (by value) respectively, and that the entity may limit disclosure to cover 75% of its purchases and sales respectively. If it provides value chain disclosures it shall disclose the percentage of total sales and purchases covered.

Upstream: the supplier table in the FAQ

• Purchases Rs 1,000 crore. A 300 (30%), B 200 (20%), C 150 (15%), D 100 (10%), E 50 (5%), F 30 (3%), G 20 (2%), H 10 (1%).
• A to G each reach 2% or more, so all seven are in scope. H at 1% is not.
• Stopping at 75%: A to C give 650, which is 65%. Adding D gives 750, which is exactly 75%. So the entity may limit disclosure to A to D.

Downstream: the customer table

• Sales Rs 800 crore. X 250 (31.25%), Y 200 (25%), Z 120 (15%), P 100 (12.5%), Q 50 (6.25%), R 40 (5%), S 20 (2.5%), T 10 (1.25%).
• X to S each reach 2% or more. T at 1.25% does not.
• Stopping at 75%: X to Z give 570, which is 71.25%, short of 75%. Adding P gives 670, which is 83.75%. So X to P is the first set that covers over 75%.

Two points where the FAQ text does not tie

• The FAQ says partners A to G cumulatively contribute 98% of purchases. Its own table gives 300 + 200 + 150 + 100 + 50 + 30 + 20 = 850 of 1,000, which is 85%. We cannot tell where 98% came from. The conclusion that A to D can be the stopping point is unaffected.
• The FAQ's explanation says a partner above 2% is in scope, while the circular says 2% or more. The example itself treats G at exactly 2% as in scope, which matches the circular.

What the entity then discloses

If it stops at A to D and X to P, the coverage figures to disclose are 75.0% of purchases and 83.75% of sales. The FAQ also states that value chain disclosure is voluntary for the top 250 listed entities from financial year (FY) 2025-26, and that assessment or assurance of it is voluntary too; the circular starts that voluntary assessment or assurance from FY 2026-27.

What Senseible does here

Senseible reads fuel invoices and electricity bills into monthly records, so a supplier can show the energy and fuel behind its own figures when a listed buyer asks. It does not decide who is in a buyer's value chain.

• Value chain data request to a small supplier
• Downstream partners in BRSR value chain disclosure
• BRSR value chain and assurance timeline
• BRSR and BRSR Core in plain words

Sources: SEBI, FAQs for the LODR Regulations, updated 23 April 2025, SEBI circular SEBI/HO/CFD/CFD-PoD-1/P/CIR/2025/42, 28 March 2025

Last reviewed 2026-11-05. The amounts are SEBI's own example, in rupees (Rs). SEBI may revise the thresholds or timelines, so check the latest circular.