Trends in Sustainability and Climate Change-Related Information Disclosure Systems
in ASEAN Countries
The Spread of Sustainability in Corporate Financial Information Disclosure
With the growing concept of ESG investment, institutional investors worldwide are increasingly focusing on and selecting companies that consider environmental, social, and governance factors when making investment decisions.
Against this backdrop, the Task Force on Climate-related Financial Disclosures (TCFD) was established in 2015 at the request of the G20, and in June 2017, the TCFD published its recommendations urging companies and financial institutions to disclose the financial impacts of climate change.
Reflecting the growing demand for companies to provide high-quality, globally comparable information on sustainability-related risks and opportunities, the International Sustainability Standards Board (ISSB) was established under the International Financial Reporting Standards (IFRS) Foundation in 2021. After several years of deliberation, the ISSB published international disclosure standards for sustainability and climate change-related information in June 2023. These standards are currently in the process of being integrated into the sustainability disclosure systems of individual countries.
Overview of ASEAN Countries’ Sustainability and Climate Change-Related Disclosure Systems
In recent years, ASEAN countries have been developing systems for reporting corporate GHG emissions with the aim of establishing carbon credit markets and implementing carbon pricing. Given that GHG emissions disclosure aligns closely with sustainability information disclosure, there is a high level of compatibility between the two.
Therefore, a survey was conducted to understand the trends in climate-related disclosure within sustainability-related information led by stock exchanges and securities and exchange commissions in the ASEAN region. Below is an overview of the systems in each ASEAN country as of the end of October 2023.
| System Overview (as of October 31, 2023) | ||||||||||
|---|---|---|---|---|---|---|---|---|---|---|
| Brunei | Cambodia | Indonesia | Lao-PDR | Malaysia | Myanmar | Philippines | Singapore | Thailand | Vietnam | |
| Existence of a framework (if applicable, name of the relevant law or regulation) |
N/A | N/A | Regulation of the Financial Services Authority Number 51/POJK.03/2017 Regarding the Implementation of Sustainable Finance | N/A | - Main Market Listing Requirements - ACE Market Listing Requirements |
N/A | MC No. 04 s.2019 – Sustainability Reporting Guidelines for Publicly-Listed Companies | - Listing Rules 711A and 711B - Practice Note 7.6 Sustainability Reporting Guide |
- 56-1 One Report - Guideline on the report of GHG emission |
- Circular No. 155/2015/TT-BTC - Environmental and Social (E&S) DISCLOSURE GUIDE (only for Ho Chi Minh Stock Exchange) |
| Mandatory/Voluntary | - | - | Mandatory | - | Mandatory | - | Mandatory | Mandatory | Mandatory | Mandatory |
| Responsible agency | - | - | Otoritas Jasa Keuangan (OJK) | - | Brusa Malaysia | - | The Securities and Exchange Commission（SEC） | Singapore Exchange（SGX） | The Securities and Exchange Commission（SEC） | Ministry of Finance of Vietnam |
| The date of entry into force | - | - | January, 2020 | Reporting Obligation: December 31, 2016 Scope 1, 2, and 3 GHG emissions reporting: December 31, 2025 |
- | 2019 | Reporting Obligation: January, 2018 Report to TCFD: January, 2023 |
January, 2022 | January, 2016 | |
| Scope of application | - | - | Listed company | Listed company | - | Listed company | Listed company | Listed company | Listed company | |
| Coverage to Scope 1 and 2 GHG emissions | - | - | N/A | - | Yes | - | Yes | Yes | Yes | N/A |
| Coverage to Scope 3 GHG emissions | - | - | N/A | - | Yes | - | Yes | Yes | Yes | N/A |
| Calculation methodology | - | - | N/A | - | N/A | - | N/A | GHG Protocol or other international methodologies | N/A | N/A |
| Data submission platform | - | - | N/A | - | Yes Sustainability Reporting Platform |
- | N/A | Yes SGX ESGenome |
Yes | N/A |
| Declaration of support for TCFD | N/A | N/A | Yes | N/A | Yes | N/A | Yes | Yes | Yes | N/A |
| Best practices | - | - | - | Yes Sustainability Reporting Guide |
- | N/A | N/A | Yes Sustainability Disclosure Award |
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Trends in Sustainability-Related Information Disclosure and Considerations
In the ASEAN region, stock exchanges and securities and exchange commissions have been promoting sustainability-related information disclosure, particularly among listed companies. However, the scope and content of the disclosure vary by country.
Key points for consideration moving forward include the potential expansion of disclosure requirements to non-listed companies, the synergy with GHG emissions measurement, reporting, and verification (MRV) systems, and addressing technical aspects such as specifying methodologies for calculating disclosed GHG emissions.