Carbon
Footprint
Assessment
The UN Sustainable Development Goals (“SDGs”), the Task Force on Climate-related Financial Disclosures (“TCFD”) and other initiatives have all contributed to the need for business to adopt a holistic approach to business management, taking into consideration the economic, environmental and social (“EES”) risks and opportunities, alongside financial implications.
Malaysia too is evolving into a responsible investment hub where local investors are increasingly considering sustainability factors in their investment decision-making. The growth in responsible investment sees an increasing demand for quality environmental, social and governance (“ESG”)/ sustainability related disclosures to allow investors to make better informed investment decisions.
Given the growing demand for sustainability performance and disclosures, the FTSE Russell and Bursa Malaysia Securities Berhad (“Bursa”) had introduced an ESG Index for the Malaysian market called the FTSE4Good Bursa Malaysia Index which is part of the globally benchmarked FTSE4Good Index Series.
The main objectives of the FTSE4Good Bursa Malaysia Index are to provide support to investors in making ESG investments in listed issuers; increase the profile and exposure for organisations with leading ESG practices; encourage best practice disclosures and draw capital allocation and investment interest for those investors focused on ESG risks.
By incorporating EES/ ESG considerations alongside financial ones, this would serve as a sound business model that supports business continuity and competitiveness over the long term.
In 2018, Bursa issued the Sustainability Reporting Guide 2nd Edition to assist the listed issuers to fulfil the requirements on sustainability disclosures in their annual reports, as required under Bursa’s Listing Requirements
In brief, these requirements are mandatory to the categories below:
- Main Market listed issuers with market capitalisation (excluding treasury shares) of RM2 billion and above, as at 31st December 2015, or as at the date of its listing in 2016.
- All Ace Market listed corporations, for financial year end (FYE) on or after 31st December 2018.
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