Singapore delays full climate disclosures for small and mid-sized listcos

The Accounting and Corporate Regulatory Authority (Acra) and Singapore Exchange Regulation (SGX RegCo) have pushed back most climate reporting requirements for small and mid-sized listed companies by five years.

While all listed companies were supposed to make climate-related disclosures aligned with standards by the International Sustainability Standards Board (ISSB) for financial years starting from January 2025, listed companies that are not constituents of the Straits Times Index (STI) and with a market capitalisation below S$1 billion only need to do so from FY2030.

The extension follows a recommendation put forth in June by the Singapore Business Federation. The umbrella association of businesses had asked for a one to two-year delay in compliance by listed small and mid-sized companies, citing feedback that a majority were not confident in meeting the original timeline.

Non-STI constituents with a market capitalisation of S$1 billion and above will have to comply from FY2028, said a joint media release on Monday (Aug 25) by Acra and SGX RegCo.

All listed companies, irrespective of their market size or whether they are an STI constituent, will still have to report their operation emissions (Scope 1) and those arising from their use of electricity (Scope 2) from this financial year.

Scope 1 and Scope 2 reporting remains mandatory as these are key information in tracking companies’ decarbonisation progress, said the media release.

Reporting requirements for STI constituents remains unchanged. They have to continue disclosing their Scope 1 and 2 emissions, as well as other climate-related requirements relating to governance, risk and strategy aligned with ISSB standards from FY2025.

Singapore regulators also confirmed on Monday that STI constituents will have to report their indirect emissions resulting from their supply chain – known as Scope 3 emissions – from FY2026. Scope 3 reporting requirements remains voluntary for the rest of the listed companies.

SGX RegCo said in September last year that it was reviewing reporting requirements for Scope 3 emissions, given that there was feedback on the challenges of measuring and reporting them, but added that it intended to prioritise “larger issuers” to report these indirect emissions from FY2026.

The regulators said that STI constituents will continue to lead efforts to implement other ISSB-aligned climate disclosures.

While reporting requirements for STI constituents remain the same, external limited assurance for Scope 1 and 2 emissions has been deferred by two years to FY2029. This also applies to other listed companies. 

External limited assurance refers to having an independent third-party evaluating the data published in companies’ sustainability reports.

Sweeping changes

These sweeping changes are part of a three-tier structure that the regulators have adopted to phase in reporting obligations based on market capitalisation.

Singapore’s regulators said that the extended timelines will support companies in developing reporting capabilities. They also took into account the uncertain global economic landscape, as well as feedback to take into greater consideration the varying levels of resources and readiness in climate reporting.

“With the updated requirements, companies will be better able to balance compliance costs with developing climate reporting capabilities, which are required for the longer term to maintain their place in global supply chains. Companies should also continue to align their trajectory with Singapore’s net-zero target by 2050,” said the media release.

However, the pushback in reporting timelines puts Singapore’s climate reporting regime behind Malaysia.

Malaysia has mandated that large companies listed on its main market to start reporting ISSB-aligned disclosures from 2025, while other listed companies will have to do so from 2026. Smaller listed companies on its ACE market – which is similar to SGX’s Catalist board – are required to disclose from 2027.

Non-listed companies

There will also be a three-year delay in mandating ISSB-aligned climate reporting for large non-listed companies.

Instead of the original timeline of FY2027, non-listed companies with an annual revenue of at least S$1 billion and total assets of at least S$500 million will have to make these disclosures only from FY2030.

Scope 3 emissions reporting remains voluntary until further notice, while external limited assurance for Scope 1 and 2 emissions has been pushed back to FY2032 from FY2029 previously.

Source: The Business Times © SPH Media Limited. Permission required for reproduction.

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