Bursa enhances sustainability reporting requirements in Listing Requirements

11 January 2023

On 26 September 2022, Bursa Malaysia Securities Berhad (“Bursa Malaysia”) announced the enhancement of the sustainability reporting requirements in the Main Market Listing Requirements (“Main Market LR”) and ACE Market Listing Requirements (“ACE Market LR”). The aim is to elevate the sustainability practices and disclosures of listed companies (“Enhanced Sustainability Disclosures”).

Main Market LR

Listed issuers on the Main Market are now required by Bursa Malaysia to disclose a common set of prescribed sustainability matters and indicators that are deemed material and climate-related disclosures in line with the Task Force on Climate-related Financial Disclosures (“TCFD”).

Bursa Malaysia added the requirement to disclose enhanced quantitative information to facilitate the assessment of progress and performance of stakeholders and promote accountability of listed issuers, for example a minimum of three financial years’ data, on a rolling basis, for each reported indicator. Bursa Malaysia also clarified that the recognised standards are the International Standard on Assurance Engagements (ISAE) 3000 and the International Organisation for Standardisation (ISO).

Further, issuers are required to provide a statement of assurance (“Statement of Assurance”) on whether the narrative statement on the management of material economic, environmental and social risks and opportunities in the listed corporations’ annual reports has been reviewed internally by the internal auditor or independent assurance.

ACE Market LR

Bursa Malaysia has strengthened the sustainability reporting requirements for the ACE Market LR by aligning them with the Main Market LR. An additional condition has been imposed for issuers to provide a basic plan in transitioning towards a low-carbon economy (“Transition Plan”). This criterion is for companies in the ACE Market to integrate and facilitate considerations of climate-related risks and opportunities into the Transition Plan.

The implementation of the Enhanced Sustainability Disclosures will be in phases. Disclosures of a common set of prescribed sustainability matters and indicators that are deemed material for all listed issuers, quantitative information for material sustainability matters, Statements of Assurance, and climate-related disclosures in line with the TCFD Recommendations will be implemented in both Listing Rules in phases between 31 December 2023 - 2026 depending on the reporting requirements. The implementation dates are set out in the table under Appendix 1 of the Bursa Malaysia media release.

In line with the introduction of the Enhanced Sustainability Disclosures, Bursa Malaysia has also issued an updated Sustainability Reporting Guide and six updated toolkits containing detailed thematic guidance for listed corporations in respect of the compliance with the Enhanced Sustainability Disclosures.