Kuala Lumpur, 15 October 2024 — The joint environment, social, and governance (ESG) disclosure assessment report by the Securities Commission Malaysia (SC) and the World Bank highlights that while most listed companies showed good disclosures on corporate governance and social practices, but there were gaps in environmental disclosures, particularly in areas related to climate change and biodiversity.
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Based on an in-depth assessment conducted between August and December 2023, the report examined the ESG disclosure practices of a representative sample of 90 companies listed on Bursa Malaysia, as well as the processes among some of Malaysia’s largest asset owners.
Other findings from the report include:
1. Larger companies (based on market capitalisation) had significantly better ESG disclosure rates than smaller ones
2. Regulatory compliance was the primary driver of corporate ESG reporting in Malaysia.
3. On ESG disclosure practices among four large Malaysian asset owners, the assessment indicated relatively low levels of ESG disclosure. However, interviews suggested greater efforts to strengthen ESG practices and processes other than currently publicly disclosed.
This report aims to analyse the current state of ESG disclosure amongst listed companies and institutional investors, given the growing prominence of ESG and sustainability investments globally.
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Other findings from the report include:
1. Larger companies had significantly better ESG disclosure rates than smaller ones
2. Regulatory compliance was the primary driver of corporate ESG reporting in Malaysia.
3. On ESG disclosure practices among four large Malaysian asset owners, the assessment indicated relatively low levels of ESG disclosure. However, interviews suggested greater efforts to strengthen ESG practices and processes other than currently publicly disclosed.
“Speaking at the SC-World Bank Conference 2024 today, Sharifatul Hanizah Said Ali, Executive Director of the Islamic Capital Market (ICM) at the Securities Commission (SC), emphasized the importance of strengthening ESG disclosures amid the growing global demand for sustainable investments.
‘This joint report reflects our ongoing commitment to fostering a more sustainable capital market. Improved ESG disclosure practices are expected to enhance investor confidence and ensure that our market remains competitive and future-ready,’ she stated.
The report concludes with a set of recommendations, including continuous monitoring along with consultations, to ensure effective implementation of the ESG disclosures in line with the recently launched National Sustainability Reporting Framework (NSRF).
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Last updated: 15 Oct 2024
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