Singapore Proposes Mandatory Climate Reporting: A Step Towards Sustainability and ESG Transparency
This week, Singapore has proposed mandatory climate reporting for both private and public companies. This new regulation represents a significant move towards Sustainability and ESG in the Asia Pacific Region and aims to drive greater transparency, accountability, and responsible corporate behavior. Aligned with the International Sustainability Standards Board (ISSB) this new regulation is lining Singapore up to rapidly become a sustainability leader in the region. Similar to what we are seeing with CSRD in Europe and the SEC Climate Disclosures in the United States, this new development certainly highlights the pressing need for innovative solutions that help with ESG and Sustainability disclosures and data aggregation, such as those offered by Sustaira. Let’s dive in, in a little more detail.
Photo by Isaac Matthew on UnsplashUnderstanding the New Regulation
To give a bit more insight, at a high level this regulation will require large public and private companies in Singapore to provide climate-related disclosures. According to a proposal by Singapore's Accounting and Corporate Regulatory Authority (ACRA) and Singapore Exchange Regulation (SGX RegCo), businesses in Singapore will be mandated to provide climate-related disclosures that are specifically in line with the newly published disclosure standards of the International Financial Reporting Standards (IFRS) newly published International Sustainability Standards Board (ISSB) standards. According to the proposal, this regulation is meant to contribute to Singapore's Green Plan 2030 as well as strengthen its commitment to the UN’s 2030 Sustainable Development Agenda.
According to ESG Today, under the new proposals, all listed issuers, including those incorporated overseas, as well as business trusts and REITs, would be required to report climate-related disclosures beginning in fiscal year 2025, with non-listed companies with at least $1 billion in revenues beginning in FY2027.
The adoption of this regulation makes Singapore one of the first countries in Asia to adopt such comprehensive ESG and Sustainability measures. By aligning this new proposal to the standards set by ISSB, companies will now have a more standardized approach when it comes to measuring and disclosing their environmental impacts. As we have seen across the globe with other regulations like CSRD this will certainly have a global impact and allows for more comparability and international collaboration within ESG and Sustainability.
ACRA Assistant Chief Executive Kuldip Gill said:
“Trusted and consistent climate reporting is essential to drive accountability and decisive actions by companies. It will also rally companies towards contributing to Singapore’s net zero emissions commitments, expediting our transition to a green economy.”
This new mandate around climate disclosures will aid in creating transparency. This new transparency will enable stakeholders to have better insights into an organization’s sustainability and ESG performance as well as hold organizations accountable for their impacts. By mandating companies to disclose their climate-related risks, opportunities, and mitigation strategies, this regulation empowers investors, customers, and the public to make informed decisions.
SRAC Chairperson Esther An said:
“With more countries pledging for net zero and the rising carbon cost globally, climate strategy and reporting can help companies, listed or non-listed, to mitigate and adapt to risks in the transition to a low carbon economy. What gets measured gets managed. There is a strong business case for climate reporting as it has helped many businesses to improve performance and create stronger competitive advantage by capturing growth opportunities.”
This is also very much in line with global efforts to address sustainability. A large goal across the globe is to channel investments toward sustainable ventures. With climate-related disclosures becoming a prerequisite for sustainable investing, companies that proactively embrace sustainability practices and transparent reporting will likely attract more responsible investors.
How We Can Help
As the need for effective climate reporting and sustainability solutions intensifies, companies like Sustaira are poised to play a crucial role. Ultimately, the challenges that companies face when trying to disclose their ESG and sustainability data are digital challenges that require flexible solutions. Sustaira, a global company with partners in Singapore, offers innovative technologies and expertise to help businesses navigate the complexities of sustainability and ESG reporting. With Sustaira’s comprehensive suite of solutions, we empower companies to measure, manage, and mitigate their environmental impact while adhering to regulatory requirements and the ever-changing landscape of ESG and sustainability.
Try the Sustaira platform for free today via the Get Started button at the top right of this screen!
Sources:
https://www.esgtoday.com/singapore-proposes-mandatory-climate-reporting-for-both-public-and-private-companies/
https://www.irmagazine.com/reporting/singapore-proposes-issb-aligned-climate-disclosure-all-listed-companies
https://www.eco-business.com/news/singapore-among-the-first-in-asia-to-propose-mandatory-climate-reporting-for-non-listed-companies/
