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Capital Market Plays Pivotal Role in Supporting Sustainability-Related Investments
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Securities Commission Malaysia (SC) chairman Datuk Seri Awang Adek Hussin said one of SC’s key priorities is ensuring that the capital market is able to channel funds, as well as capital, towards meeting sustainability targets.
“To do so, investors and lenders will require more transparent, comparable and reliable information from companies on their sustainability journey.
“These data and information will allow investors to better price such risks and opportunities,” he said in his opening address at the Sustainable and Responsible Investment (SRI) Virtual Conference 2023 on Wednesday (June 21).
Awang Adek said the International Sustainability Standards Board (ISSB) is developing a global baseline standard for sustainability disclosures, which is expected to be completed this month.
“Given the complexity and different levels of market maturity in terms of sustainability practices and reporting, it is expected that jurisdictions will be given some flexibility to set their own timeline for adoption of these disclosure standards,” he said.
From the emerging market’s perspective, he said Malaysian public-listed companies should be ahead of the curve, given their headstart in sustainability reporting since 2015, as Bursa’s sustainability reporting requirements are also in line with the ISSB standards.
“I urge companies to take immediate steps to meet the information needs of stakeholders, if they have not already done so.
“The SC and Bursa will provide companies with the required support, including capacity building programmes,” he said.
Meanwhile, Awang Adek said the SRI Taxonomy for the Malaysian capital market, which was unveiled recently, is aimed at ensuring the standardisation and comparability of SRI and sustainability assets.
“We believe that this will also enhance the synergies between Islamic investing principles and the SRI.
“A prime example of social finance is waqf, which is endowments or charitable trusts that can be utilised for social causes such as education, healthcare and poverty alleviation.
“Given its role in enhancing societal welfare, I would like to urge the private sector to consider this Islamic structure in promoting and satisfying its social obligations,” he said.
Awang Adek added that the SC is currently working on guiding principles based on Maqasid al-Shariah (the objectives or purposes behind Islamic rulings), encompassing areas such as social finance, impact investing, SRI, as well as Islamic fund and wealth management.
“We hope this will attract more interest for social finance in Malaysia, as well as better align with Islamic principles to promote socially beneficial outcomes with the overall sustainability agenda,” he said.
Themed “Revving Up the Race for Sustainability”, the fourth edition of the SRI conference is being held from June 21-22, hosted by the Securities Industry Development Corporation (SIDC), the capacity-building arm of the SC.
The conference features more than 30 local and international industry leaders and experts, covering a wide range of cutting-edge sustainability topics such as “Sustainability by Design” and “SRI Catalysing A Shared Value for Business and the Nation”.
The information provided in this report is of a general nature and has been prepared for information purposes only. It is not intended to constitute research or as advice for any investor. The information in this report is not and should not be construed or considered as an offer, recommendation or solicitation for investments. Investors are advised to make their own independent evaluation of the information contained in this report, consider their own individual investment objectives, financial situation and particular needs and should seek appropriate personalised financial advice from a qualified professional to suit individual circumstances and risk profile.
The information contained in this report is prepared from data believed to be correct and reliable at the time of issuance of this report. While every effort is made to ensure the information is up-to-date and correct, Bond and Sukuk Information Platform Sdn Bhd (“the Company”) does not make any guarantee, representation or warranty, express or implied, as to the adequacy, accuracy, completeness, reliability or fairness of any such information contained in this report and accordingly, neither the Company nor any of its affiliates nor its related persons shall not be liable in any manner whatsoever for any consequences (including but not limited to any direct, indirect or consequential losses, loss of profits and damages) of any reliance thereon or usage thereof.
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