Wednesday, 13 February 2019

Managing Sustainability Reporting

In 2015, Bursa Malaysia launched its Sustainability Framework, making it mandatory for all public-listed companies (PLCs) to prepare sustainability reporting. Companies listed on the Main Market and ACE Market were required comply, depending on their market capitalisation, with the framework requirements in 2017, 2018 or 2019, where the sustainability reports are to be published alongside the annual reports.

Listed companies
Annual reports issued for financial year ending on or after
Reports
Main Market with market capitalisation
RM2b or more
31 December 2016
General and Detailed Sustainability Statement
RM1b to RM2b
31 December 2017
General and Detailed Sustainability Statement
Others
31 December 2017
General and Detailed Sustainability Statement
ACE Market
31 December 2018
General Sustainability Statement

Bursa Malaysia’s Sustainability Framework was developed in response to the United Nation’s 2030 Agenda for Sustainable Development. Under the 2030 Agenda, 17 goals consisting of 169 targets were set. They cover social and economic development issues such as poverty, hunger, health, education, global warming, gender equality, water, sanitation, energy, urbanisation, environment and social justice.

Prior to the issuance of the Sustainability Framework, both Main and ACE Market listed companies are required to disclose their CSR activities in their annual report. However, this tended to skew towards social/philanthropic activities which has minimal impact on a company’s business operations or value creation process. As such, the Sustainability Framework aims to, among others, encourage companies to integrate sustainability into their business models by taking into consideration the economic, environmental and social (EES) risks and opportunities alongside financial implications as well as report such non-financial information.

Bursa Malaysia has provided guidance on the disclosure obligations and best practice in preparing the Sustainability Statement via the Listing Requirements of Bursa Malaysia and Practice Note 9/Guidance Note 11. However, the call for further reporting requirements brings out phrases such as “compliance burden” and “checklist ticking”. Nevertheless, there is value in a more holistic reporting. Investors value non-financial information such as strategy, risks, etc., and even more so when place in the context of the business models, strategy and financials. Key management personnel would be able use additional information to achieve better connected internal decision making, and drive the success and continuation of their business.

Apart from working towards the sustainability report deadlines, businesses also need to look into moving into sustainability management for value creation and business continuity from merely preparing sustainability reporting for compliance reason. Some of the factors that need to be considered in sustainable development planning include:

  • Steps for sustainable development planning
  • Building a case for sustainable development planning
  • Strategies to establish stakeholder partnerships and maintenance of such partnerships
  • Resource development
As sustainability planning and reporting is fairly new, with little part experience to draw upon, it is best to start early.

Wolters Kluwer’s Sustainable Development Planning for Business Sustainability workshop aims to provide knowledge on sustainability reporting and sustainability management, using hands-on approach, professional thinking tools and storytelling.

At the end of the workshop, you should:

  • Understand the need for sustainability management
  • Be able to assess how businesses can reap meaningful returns from value creation through sustainable development planning
  • Learn the basic tools to prepare a sustainability plan
  • Be updated with Bursa Malaysia's sustainability reporting requirements
  • Learn to review and reflect the role of a sustainability specialist and the organisation's commitments to its global goals.

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