SBF seeks more time for smaller listed companies to comply with new climate-related disclosure rules

Straits Times

26-06-2025

The Singapore Business Federation's recommendations apply to smaller businesses, which make up 84 per cent of SGX listings BT PHOTO: TAY CHU YI
SBF seeks more time for smaller listed companies to comply with new climate-related disclosure rules
SINGAPORE - The Singapore Business Federation (SBF) has proposed extending the deadline for small- and mid-sized companies listed on the Singapore Exchange (SGX) to comply with the latest sustainability disclosure requirements by one to two years.
This is one of the four recommendations released by SBF on June 26, in relation to the disclosures.
Under SGX Regulation's (SGX RegCo) prevailing sustainability reporting regime, all listed companies have to make climate-related disclosures aligned with standards developed by the International Sustainability Standards Board (ISSB) for financial years that start from Jan 1, 2025.
Only 4 per cent out of 40 listed companies polled by SBF and SGX RegCo between April and May this year were very confident about meeting this timeline, even though all the engaged listed companies were already preparing for ISSB disclosures.
More than 90 per cent of them also said extending the timeline for mandatory ISSB disclosures by one or two years would be useful for them to prepare higher-quality sustainability reports. They also added that a time extension would not detract them from the work that they had already begun.
The three other recommendations from SBF are:
Making disclosure requirements proportionate for small- and mid-cap listed companies;
Providing Singapore-relevant cross-sector and sector-specific guidance; and
Designating a central platform for digital reporting of climate-related disclosures.
These recommendations apply to the small- and mid-sized listcos which make up 84 per cent of SGX listings, although not all listings (including secondary-listed issuers) are subject to sustainability-reporting requirements.
Mr Kok Ping Soon, chief executive of SBF, said: 'This does not represent a step back from Singapore's climate-reporting ambitions, but is a practical measure to provide smaller listed companies more time to strengthen internal capabilities and incorporate best practices after larger listed companies make their ISSB disclosures for FY2025.'
While preparations for ISSB climate reporting are underway, a deadline extension would enable small- and mid-cap companies to, for example, prepare subsidiaries which may be based overseas. It would also strengthen data collection systems and enable these smaller businesses to take guidance from the FY2025 ISSB reports by larger listed companies.
Extending the deadline would also enable small- and mid-cap listed companies to be eligible for the Sustainability Reporting Grant from the Economic Development Board and Enterprise Singapore. This is because the grant is awarded only to reports filed before the requirement to comply with mandatory climate-related disclosures kicks in.
Mr Kok also recommended increasing awareness and application of proportionality mechanisms, with more guidance within and across sectors relevant to the city-state.
'These will help smaller listed companies in Singapore take full advantage of any compliance deadline extension to more effectively transition their business,' he said.
In response to the SBF recommendations, a spokesperson from SGX RegCo said that it is aware that the ISSB standards are ambitious and that smaller companies, in particular, have found compliance challenging.
'We therefore welcome the SBF paper and appreciate the effort to gather feedback from the business community, particularly smaller listed companies. The insights from this paper will be valuable in helping us strike the right balance between advancing corporate sustainability goals and recognising the operational realities that businesses face today.'
'Ultimately, we want our companies to produce quality reports that are accurate and decision-useful,' the spokesperson added. THE BUSINESS TIMES
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