Singapore takes Sustainability Reporting by the Horns

Junice Yeo

The latest announcement by the Singapore Stock Exchange (SGX) to open up its proposed comply-or-explain ruling on sustainability reporting to the public is the latest in a series of major initiatives the bourse has undertaken to put sustainability on board level agendas. While the hammer has not actually come down on whether this means mandatory reporting for Singapore-listed companies, it is clear that the rubber has hit the road, as Singapore takes Sustainability Reporting by the horns.

The sustainability momentum has picked up over the past few months, alongside various other regulatory and government bodies following the prolonged haze pollution that shrouded the Southeast Asian region. But this has been a long time coming – SGX announced its intention to move toward this ruling as far back as 2013.

That we were the subject of poor environmental management in the Indonesian peat lands couldn’t have been more real. While the average Singapore citizen had to deal with respiratory discomfort and bleak and smoggy skies, the focus was on the local communities and wildlife trapped in the hot spots. Everyone just wanted to get to the bottom of the burning issue, and that got the sustainability ball rolling.

What I appreciated about SGX’s deliberation regarding its stance toward mandatory reporting, was that it understood the importance of sufficient buy-in, rather than issuing a blanket statement and expecting Singapore companies to comply.  The regulatory body took careful, calculated steps to announce its approach in engaging its stakeholders in the process. It executed structured rounds of two-way dialogues to ensure the SMEs had the platform to express their grievances. And it even ensured that the companies who ‘missed’ participation in the first rounds of engagement where given further opportunities to do so later.

 Still a numbers game

The truth is, whether or not this is a stick or carrot approach is inconsequential today. Companies started reporting on their environmental, social and governance data not because regulators forced them into it. The stakeholders themselves –investors, bankers, key customers and even their employees are asking for greater transparency.  The people need a credible place where they can find information over and above the sea of greenwash.

These companies did their own risk calculation and knew that it was better to start disclosing more relevant information that proves they are following responsible practices. And sustainability reports that are structured into internationally-referenced frameworks such as Global Reporting Initiative (GRI) or Dow Jones Sustainability Index (DJSI) help capture necessary information required to enable these investors and analysts to make informed decisions either to procure or invest.

This was nicely echoed in SGX’s June 2015 survey among institutional investors, in which they found that 90 per cent of respondents take environmental, social and governance (ESG) factors into account when investing.  It is easy to see why – if an investor has 10 companies to analyze within a given day, they very quickly sift out the ones they would deem as a higher risk stock just from the fact that these do not have sufficient data they can look at. Conversely, a company with rich, well-documented information about its sustainability management is very well-perceived by analysts.

What lies ahead for 2016?

Over the next 12 months and beyond, Corporate Citizenship expects more demand for clarity about Sustainability Reporting among Finance and Communications managers. Have I reported sufficiently in my Disclosure of Management Approach? What if all my factories don’t capture emissions data the same way? What templates are available for data collection? These are some of the common questions we have been receiving just in the past six months. Referring to practical guides such as GRI’s Get Started Guide or ACCA’s Reporting Guidelines may provide structured support; what they need is someone they can turn to for questions, feedback and hand-holding.

And as the bulk of major companies move onward in their sustainability journeys, more fundamental questions are likely to be raised. Should we redefine our material issues to suit our organizational structure? Should more people undergo sustainability related training? How should sustainability management be implemented across our suppliers in the region?  Development of effective strategies is the first step in target setting, whether it be to lower carbon emissions or increase transparency in supply chains. But translating these into real action is still where crux of the matter is. And so we hope this exercise opens up even more conversations among business leaders, policy makers and industry associations to address common issues faced by companies in governing environmental and social issues to help shape the landscape of sustainability management and reporting in Singapore.

Junice Yeo is the Director of Corporate Citizenship, Southeast Asia. Corporate Citizenship was established in 1997, and has offices in London, New York, San Francisco, Santiago and Singapore. Having worked with over 300 clients on all continents, Corporate Citizenship has accumulated an extensive breadth and depth of knowledge and expertise in sustainability management.

Corporate Citizenship is also the sole provider of GRI G4-Certified training in Singapore, to find out more about the next training course which is taking place between the 22-23 February, please click here.

For questions on how Corporate Citizenship can help you or your company on your reporting journey, feel free to contact our Singapore office at +65 6822 2203 or email

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