CSE CEO Rajeeva Bandaranaike noted that there was a trend towards mandatory ESG reporting as part of the listing rules of major stock exchanges the world over.
Bandaranaike said that currently 24 of the 105 exchanges involved in the Sustainable Stock Exchanges initiative had made ESG reporting mandatory. In 2018 this figure stood at 18 representing a 33% growth.
Bandaranaike was speaking on December 7at a webinar titled ‘Addressing Investor Needs Through Environmental Social and Governance (ESG) reporting’ organized by the Global Reporting Initiative.
Bandaranaike noted that even though not mandatory, many Sri Lankan companies used globally accepted frameworks for the reporting of their relevant ESG data. Bandaranaike noted that companies had realized the value of collating and publishing this information for the benefit of all stakeholders. Director GRI South Asia Aditi Haldar noted that there was a need for a ‘global common language’ for the compilation of ESG data. She said, “We must have an informed dialogue on the external impacts of a company.” Haldar noted that the standard was used across every sector and country on the planet.
CSE Head of Finance and Administration Kusal Nissanka noted that the data showed a positive correlation between companies that were concerned with ESG reporting and their stock returns. He noted that stakeholders also looked at ESG reporting as a good litmus test on how companies were managing their costs and as a result how strong the management was.
S&P Regional Head Koel Ghosh noted that sustainability reporting had grown very advanced and that firms were looking at very complex and abstract notions of sustainability like net-zero emissions and carbon offsets. Ghosh underscored the importance of ESG reporting to institutional investors and supporting institutions like S&P in their decision making.
Australian High Commission First Secretary Erika Seymour underpinned the Australian government’s support for the ESG reporting framework. Australia has looked to have leadership in the ESG reporting framework and has promoted initiatives across South Asia notably in Bangladesh and Sri Lanka.