SINGAPORE – Four Asean stock exchanges will be jointly developing an initiative to implement common ESG (environmental, social, and governance) metrics in their respective data infrastructures and advance the region’s sustainable development.
The Singapore Exchange (SGX), Bursa Malaysia, the Stock Exchange of Thailand (SET) and the Indonesia Stock Exchange (IDX) have formalised the Asean-Interconnected Sustainability Ecosystem (Asean-ISE), said the exchanges in a joint statement on Feb 15. They also agreed on a foundational governance structure and operational blueprint for building this ecosystem.
Bursa Malaysia, SET and IDX had entered a memorandum of understanding to explore establishing such an ESG ecosystem in September 2023. SGX is the newest entrant to the collaboration.
Under Asean-ISE, the bourses intend to proactively assist ESG-compliant corporates in maximising business value through “quality disclosures”.
This involves developing infrastructure solutions to facilitate cross-border trade flows, connecting corporates’ supply chains to ESG-oriented investment capital, and providing suppliers with good ESG practices and disclosures to secure more competitive financing rates.
The initiative will also enable the four stock exchanges to “achieve economies of scale through cost efficiency and faster time-to-market with fit-for-purpose solutions”, said the joint statement.
“As part of the Asean-ISE implementation, the exchanges have agreed upon outcome-driven collaboration deliverables that take into account local considerations and maturity level of their respective markets,” the release added.
They have also committed to adopt and implement the Asean Exchanges common ESG metrics in their ESG reporting platforms.
These metrics refer to areas recommended for disclosure by listed companies by Asean Exchanges, a collaboration among the bourses in Malaysia, Indonesia, Thailand, Singapore, Vietnam and the Philippines.
The recommended metrics for disclosure cover various ESG topics including energy consumption, greenhouse gas emissions, gender diversity, non-discrimination, development and training, board diversity and board independence.
Bursa Malaysia will serve as the secretariat for the initiative.
SGX chief executive Loh Boon Chye said: “We look forward to working together with the members to standardise data to create interoperable datasets that will reinforce our collective efforts to drive capital towards sustainability efforts and address climate change in the region.”
Shares of SGX closed up 1.4 per cent, or $0.13, to $9.28 after the announcement. THE BUSINESS TIMES
