The drive for sustainability in Singapore has increasingly become evident in recent years. To cite a few examples:
- Regulation such as the Energy Conservation Act, Public Utilities (Water Supply) Regulation and upcoming legislation on sustainable packaging as well as the Sustainable Singapore Blueprint are calling for and driving companies to be more environmentally sustainable;
- A recent report by the Committee on the Future Economy (CFE) recommended that the government continue to create a sustainable environment, which could affect companies in the future in the form of legislation;
- A recent announcement by Singapore’s Minister for the Environment and Water Resources, Masagos Zulkifli, that water prices will increase for the first time in 17 years due to anticipated higher costs of producing water and in view of less reliable weather. Such risks are real and could threaten the operation or sustainability of companies particularly water-intensive companies;
- Sustainability becoming a competitive space with ratings, indices and rankings such as the SGX Sustainability Indices and Channel NewsAsia Sustainability Ranking assessing and benchmarking listed companies’ sustainability performance; and
- Singapore listed companies now mandated by the Singapore Exchange (SGX) to disclose Environment, Social and Governance (ESG) information in the form of sustainability reports from financial year 2017 on a “comply or explain” basis (see our past article about the requirements).
These are clear indications that sustainability is a growing area that companies in Singapore need to manage and that there will be an increasing demand from different stakeholder groups for companies to disclose their ESG practices.
So what is the state of disclosure from companies in Singapore? Since 2011 CSR Asia has been the Singapore Data Partner of the Global Reporting Initiative (GRI), the organisation that developed the internationally recognised GRI Sustainability Reporting Standards (GRI Standards). Over this time we have been tracking the number of sustainability reports produced in Singapore, and while the number of reporters publishing sustainability reports in accordance with the GRI reporting framework are increasing year-on-year, generally the uptake rate is slow (see chart below). But with more than 700 companies listed on SGX that need to comply with the mandatory Sustainability Reporting requirements, we can expect the number of reporters to significantly increase at a faster rate.
Source of the data: GRI Sustainability Disclosure Database, retrieved on 12th December 2016. The data available in the database is collected by GRI in collaboration with its data partners and captures all reports of which GRI is aware.
Support provided to Singapore listed companies for sustainability reporting
With the mandatory Sustainability Reporting requirements coming into effect for the next reporting cycle, Singapore listed companies are not left unguided to familiarise themselves with the reporting requirements and to prepare their sustainability reports. Since the announcement of the Sustainability Reporting requirements in June 2016, SGX, with the support from Global Compact Network Singapore (GCNS), actively reached out to listed companies through CEO Briefing Sessions and sector-specific seminars to brief and help listed companies understand the requirements and the business case for producing a sustainability report. SGX has also recently appointed GCNS to organise sector-specific one-day workshops to help listed companies build their capability to prepare their sustainability reports, as well as launching a Singapore sustainability reporting website.
As one of the consultancies selected by GCNS and SGX to guide companies to implement the new Sustainability Reporting requirements, CSR Asia will be conducting the one-day workshops for the Real Estate, Transportation and Capital Goods sectors. Dates for the workshops will be announced soon on our website.
In-line with SGX, CSR Asia sees the Sustainability Reporting requirements as an opportunity to enhance the visibility of Singapore listed companies among investors worldwide who seek sustainable investments and want to review a company’s ESG efforts. The process of producing a sustainability report itself also acts as a valuable management tool for companies to assess their environmental, social and governance (ESG) matters to mitigate risks and enhance opportunities for processes and innovation.
CSR Asia has conducted webinars on the GRI Standards and SGX Sustainability Reporting requirements and plan to conduct the webinars again. We can also conduct Board briefing for companies. Speak with us to find out how CSR Asia can support you in the preparation of your sustainability report or how to embark on a sustainability journey that will add value to your company. Please contact Angela (angela.foulsham[at]csr-asia.com) and Justin (justin.teo[at]csr-asia.com) or refer to our sustainability reporting page for more details.
Image credits: West Michigan Sustainable Business Forum