Singapore Exchange to table ISSB-aligned listing rules in Q4

The exchange has told companies to start working on climate transition plans.

The regulatory arm of Singapore Exchange (SGX) will propose changes to its listing rules to align reporting requirements with the ISSB climate disclosure standards by the end of the year.

The rules will be finalised in 2024 following a public consultation, according to a note published today by SGX RegCo chief Tan Boon Gin and Michael Tang, head of listing policy and sustainable development.

The announcement paid particular attention to the ISSB’s requirements for companies to publish climate transition plans under its strategy pillar, and noted that companies should begin developing plans with formal oversight from directors and senior management, and appropriate incentive structures.

“Creating a transition plan is an involved process, and getting started early will facilitate a smoother transition to reporting against the ISSB standards,” Tan and Tang said.

“Robust transition plans that are well disclosed will stand a better chance of maintaining access to capital markets, including benefiting from green and transition finance. Companies will also find it easier to plug into global supply chains if they are able to meet international supplier due diligence requirements.”

The proposals from SGX RegCo will take into account the feedback from another ongoing consultation, due to close at the end of this month, which the listings body launched in partnership with Singapore’s accounting regulator on how climate reporting should be introduced in the city state.

Stakeholders were asked to comment on whether Singapore should mandate ISSB-aligned disclosures from 2025 onwards for listed issuers, and from 2027 for large private companies.

Listed companies within the financial, agriculture and energy sectors are already on course to file their first mandatory TCFD-aligned climate reports next year, based on 2023 information.

SGX RegCo was created as an independent subsidiary of SGX in 2017 and is responsible for all front-line regulatory functions at the exchange.

Separately, the Singapore central bank recently announced that its green taxonomy would be delayed to incorporate additional criteria on the managed phase-out of coal-fired power plants. A new draft of the framework was initially due to be published in June.

It is expected that the taxonomy will include sustainability criteria for seawater desalination, a world first, according to the Climate Bonds Initiative, which is involved in the development process.