Sustainability Reporting: Aligning with Global Standards

Sustainability reporting has become an integral part of corporate governance, reflecting a company's commitment to environmental, social, and governance (ESG) principles. In September 2024, Bursa Malaysia issued a consultation paper proposing amendments to the Main Market and ACE Market Listing Requirements to enhance sustainability reporting.

Key Changes: The proposed amendments aim to align sustainability reporting requirements with international standards, such as the International Sustainability Standards Board (ISSB) standards. Key changes include:

• Mandatory disclosure of workforce diversity, including gender, ethnicity, and generation.

• Enhanced requirements for sustainability assurance.

• A phased approach to compliance with the new reporting standards.

  
  

Research Insights: The global trend towards enhanced sustainability reporting is driven by growing investor demand for transparency and accountability in corporate practices. Companies that lead in sustainability reporting are more likely to attract responsible investments and build stronger relationships with stakeholders. Research indicates that robust sustainability practices can improve a company's reputation, reduce risks, and create long-term value.

Implementation Strategies: To meet the new sustainability reporting requirements, companies should:

• Integrate sustainability information into their annual reports, providing a comprehensive view of their ESG performance.

• Conduct regular assessments of their sustainability practices and identify areas for improvement.

• Engage with stakeholders to understand their expectations and incorporate their feedback into sustainability strategies.

• Invest in sustainability assurance services to enhance the credibility of their reports.

Conclusion: Enhanced sustainability reporting is essential for building trust with investors and stakeholders. By aligning their practices with global standards, Malaysian companies can demonstrate their commitment to sustainability and position themselves as leaders in the market.