The regulator cited urgent demand for such information from lenders, investors and other key stakeholders.
Singapore Exchange Regulation (SGX RegCo) is proposing a roadmap for climate-related disclosures to be made mandatory in issuers’ sustainability reports (SRs), according to an announcement on Thursday.
SGX RegCo wants issuers to make disclosures based on recommendations of the Task Force on Climate-related Financial Disclosures (TCFD), based on a phased approach, under which issuers must adopt climate reporting on a «comply or explain» from financial year (FY) 2022.
From FY 2023, climate reporting will be mandatory for some sectors, while comply or explain will remain the approach for the others, with more sectors included from FY 2024, according to the proposal, which is open for public consultation until 27 September 2021.
Board Diversity
SGX RegCo is also consulting the public on requiring issuers to subject their SRs to assurance by their internal auditors, and to require one-time sustainability training for all directors to ensure boards have common knowledge of their roles and responsibilities.
It also plans to step up efforts to enhance board diversity by requiring issuers to have a board diversity policy and provide disclosures on related targets, plans and timelines in their annual reports (ARs).
To assist issuers in providing, and investors in accessing environmental, social and governance (ESG) data, SGX RegCo said it is preparing a list of 27 ESG metrics, which may be used by issuers in conjunction with their sustainability reporting. It also suggested a data portal for investors to access ESG data in a structured format as reported by issuers in accordance with aligned metrics and disclosure requirements.
Building Resilience
«The proposals today are aimed at helping our issuers meet these demands and to build their resilience to climate risks. Some business sectors are more carbon intensive and hence climate risks affect them more significantly compared to others. These should therefore be among the first to make climate disclosures,» Tan Boon Gin, CEO of SGX RegCo.
