Starting January 1, 2025, the Singapore Exchange Regulation (SGX RegCo) is implementing significant amendments to its Listing Rules to enhance sustainability reporting by listed companies. These changes aim to align with global standards and improve the consistency, comparability, and transparency of sustainability disclosures.
The Singapore Exchange (SGX) mandates that all listed issuers prepare an annual sustainability report in accordance with Practice Note 7F. This report must comprehensively describe the issuer's sustainability practices, focusing on the following primary components:
- Material ESG Factors: Identify and disclose the environmental, social, and governance (ESG) factors that are material to the issuer's business and stakeholders.
- Policies, Practices, and Performance: Detail the policies and practices implemented to manage the material ESG factors, along with performance metrics to demonstrate outcomes.
- Targets: Set and disclose short-term and long-term targets for each material ESG factor, explaining the rationale and action plans to achieve them.
- Sustainability Reporting Framework: State the framework(s) used to prepare the sustainability report, ensuring alignment with internationally recognized standards.
- Board Statement: Include a statement from the board of directors acknowledging responsibility for the sustainability report and confirming that ESG factors have been considered in the issuer's strategy and business.
Key Amendments to SGX Listing Rules Effective 2025
- Mandatory Disclosure of Greenhouse Gas Emissions: All SGX-listed companies must report their Scope 1 and Scope 2 greenhouse gas emissions for the financial year 2025. This requirement ensures transparency regarding direct and indirect emissions.
- Alignment with Global Standards: Companies’ sustainability reports must align with the International Financial Reporting Standards (IFRS) Sustainability Disclosure Standards. This alignment ensures global comparability and credibility of disclosures.
- Phased Implementation for Broader Changes: Additional reporting requirements, including detailed timelines, will take effect starting January 1, 2026, allowing companies adequate time to adapt.
These amendments underscore SGX’s commitment to fostering transparent and accountable sustainability practices, equipping investors and stakeholders with consistent and actionable data.
How Grant Thornton Can Help Listed Companies
Grant Thornton Singapore
offers a comprehensive range of services to assist companies in meeting these enhanced requirements:
1. Sustainability Strategy Development
- Identify material Environmental, Social, and Governance (ESG) factors tailored to the company’s industry.
- Align business strategies with IFRS Sustainability Disclosure Standards and SGX regulations.
2. Greenhouse Gas Emissions Reporting
- Support the accurate quantification and disclosure of Scope 1 and Scope 2 greenhouse gas emissions.
- Implement systems and processes to monitor and track emissions data effectively.
3. Framework Alignment
- Guide companies in adopting frameworks like IFRS Sustainability Disclosure Standards and GRI.
- Ensure that sustainability reports comply with SGX’s enhanced requirements while addressing unique organizational needs.
4. Governance and Board Training
- Provide training for boards and management teams on their roles in sustainability reporting.
- Develop robust governance structures to ensure effective oversight of sustainability initiatives.
5. Audit and Assurance Services
- Deliver independent assurance on sustainability reports to enhance credibility and investor confidence.
- Conduct gap analyses to identify areas for improvement and ensure compliance with SGX guidelines.
6. Climate-Related Risk Assessment
- Perform climate risk assessments and scenario analyses.
- Integrate climate-related risks into the company’s enterprise risk management frameworks.
7. Technology and Automation
- Assist implement data management tools to streamline ESG data collection, analysis, and reporting.
8. Phased Implementation Support
- Assist companies in meeting phased deadlines for new reporting requirements.
- Provide ongoing advisory services to address evolving regulations and best practices.
Get in touch with me or
Anne Liew
or
Tin Wei, Hong
to stay ahead in the journey toward enhanced sustainability reporting.
