The role of listed companies in leading Singapore’s ESG shift

AS CLIMATE reporting becomes increasingly critical, Singapore’s businesses are acutely aware of its ramifications. Historically, sustainability reporting has often been a reaction to stakeholder demands. However, with the growing focus on environmental, social, and governance (ESG) disclosures, the landscape is set for a transformation. The Singapore Exchange Regulation (SGX RegCo) will mandate Scope 1 and Scope 2 emissions reporting for listed companies starting from the 2025 financial year, marking a pivotal advancement in corporate accountability and sustainability. This regulatory shift not only reflects a growing recognition for comprehensive and transparent reporting, but also the need for an industry-wide move to align with global trends.

This regulatory requirement presents not only a challenge, but also a strategic evolution for businesses. Listed companies, with their substantial resources, expertise, and extensive networks, are uniquely positioned to spearhead this transition. Their leadership is crucial, as they can play a leading role in establishing sustainability benchmarks for the entire market, guiding small and medium-sized enterprises (SMEs) that may struggle with the complexities of ESG disclosures. With their prior engagement in voluntary reporting efforts, listed firms are set to lead beyond mere compliance, inspiring a market-wide elevation of sustainability standards.

While businesses in Singapore are increasingly focused on ESG reporting, ESG assurance needs to be prioritised alongside it as these aspects are interconnected. This assurance is pivotal in verifying the accuracy and reliability of ESG data, which is essential for transparency and stakeholder trust. Listed companies are well-placed to establish quality assurance practices due to their resources and expertise. They can define necessary controls and develop robust strategies to enhance the reliability of ESG information, ensuring that data collected is both comprehensive and credible.