Singapore has taken a significant leap towards enhancing corporate transparency and accountability in addressing climate change.
According to ESG Today, the city-state announced the implementation of mandatory climate-related reporting requirements for its listed and large non-listed companies.
This bold move, detailed by the Second Minister for Finance, Chee Hong Tat, in Parliament, outlines a phased approach to climate disclosures aligned with the International Sustainability Standards Board (ISSB) standards, starting from 2025 for listed companies and 2027 for large non-listed entities.
The initiative, advised by the Sustainability Reporting Advisory Committee (SRAC), aims to equip businesses with the tools needed for sustainability reporting and to foster a green economy. Companies are expected to begin with Scope 1 and 2 emissions reporting, expanding to Scope 3 emissions by 2026 for listed firms and no earlier than 2029 for large non-listed companies. Furthermore, to enhance the credibility of the disclosures, companies will be required to obtain external limited assurance on their Scope 1 and 2 greenhouse gas (GHG) emissions within two years of initiating reporting.
The decision to extend these reporting obligations to smaller entities remains under consideration, pending a review of the initial implementation’s outcomes. Meanwhile, the government pledges to bolster companies’ sustainability reporting and assurance skills, with forthcoming support measures from the Ministry of Trade and Industry (MTI).
Tan Boon Gin, CEO of Singapore Exchange Regulation (SGX RegCo), highlighted the strategic advantage of early adopters of climate reporting within the SGX-listed community. These firms have already begun to reap the benefits of transparent sustainability practices, including enhanced access to sustainable capital and improved relations with stakeholders interested in environmental sustainability.
This initiative not only positions Singapore as a leader in corporate sustainability efforts but also underscores the global shift towards more responsible and environmentally conscious business practices. As companies align with these new requirements, they are expected to unlock new opportunities in markets increasingly driven by sustainability considerations.
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