SEBI Revises Norms for Appointment of Third-Party Reviewer for Green Debt Securities

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SEBI green debt securities

Circular no. HO/17/11/24(1)2026-DDHS-POD1/I/5967/2026; Dated: 27.02.2026

The Securities and Exchange Board of India (SEBI) has modified Chapter IX of the NCS Master Circular relating to the appointment of third-party reviewers or certifiers for green debt securities. The changes aim to align the framework for green debt securities with the operational norms prescribed for ESG debt securities (other than green debt securities) under SEBI’s circular dated June 05, 2025.

Background and Need for Alignment

Chapter IX of the NCS Master Circular currently prescribes requirements for appointing a third-party reviewer/certifier for initial and ongoing disclosures relating to green debt securities.

Subsequently, SEBI issued a circular on June 05, 2025, specifying an operational framework for ESG debt securities (excluding green debt securities), including:

  • Initial disclosure requirements

  • Continuous disclosure requirements

  • Appointment of an independent third-party reviewer/certifier

To ensure consistency across ESG-labelled instruments such as green bonds, social bonds, and sustainability bonds, SEBI has revised the provisions applicable to green debt securities.

Mandatory Appointment of Independent Reviewer/Certifier

Under the revised framework, issuers of green debt securities must appoint an independent third-party reviewer or certifier to confirm that:

  • The issuance complies with regulatory definitions of green debt securities, and

  • Disclosure requirements prescribed by SEBI are duly met.

This requirement applies to both initial issuance and ongoing disclosure obligations.

Independence and Eligibility Criteria

The independent reviewer or certifier must meet strict independence and competency standards:

  • Must be independent of the issuer, its directors, senior management, and key managerial personnel

  • Must be remunerated in a manner that prevents conflicts of interest

  • Must possess relevant expertise in evaluating ESG debt securities and related disclosures

These conditions are intended to ensure objective and credible certification.

Disclosure of Scope of Review

The scope of review to be conducted by the independent third-party reviewer/certifier must be clearly specified in the offer document for the green debt securities.

This will enable investors to understand the extent and nature of external validation supporting the issuance.

Effective Date

The revised provisions modifying Chapter IX of the NCS Master Circular will apply with immediate effect.

Objective of the Revision

The modification seeks to:

  • Harmonise requirements across green, social, and sustainability-linked debt securities

  • Strengthen credibility and transparency of ESG-labelled instruments

  • Ensure independent verification of compliance with regulatory definitions and disclosures

  • Enhance investor confidence in ESG debt markets

The revised framework reinforces SEBI’s commitment to robust governance and transparency in the growing ESG debt securities market.

Click Here To Read The Full Circular

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Author: Taxmann

Taxmann Publications has a dedicated in-house Research & Editorial Team. This team consists of a team of Chartered Accountants, Company Secretaries, and Lawyers. This team works under the guidance and supervision of editor-in-chief Mr Rakesh Bhargava.

The Research and Editorial Team is responsible for developing reliable and accurate content for the readers. The team follows the six-sigma approach to achieve the benchmark of zero error in its publications and research platforms. The team ensures that the following publication guidelines are thoroughly followed while developing the content:

  • The statutory material is obtained only from the authorized and reliable sources
  • All the latest developments in the judicial and legislative fields are covered
  • Prepare the analytical write-ups on current, controversial, and important issues to help the readers to understand the concept and its implications
  • Every content published by Taxmann is complete, accurate and lucid
  • All evidence-based statements are supported with proper reference to Section, Circular No., Notification No. or citations
  • The golden rules of grammar, style and consistency are thoroughly followed
  • Font and size that's easy to read and remain consistent across all imprint and digital publications are applied