October 27, 2023 (MLN): The Securities and Exchange Commission of Pakistan(SECP) has issued draft guidelines on ESG disclosures for consultation as part of its Environmental, Social and Governance(ESG) Regulatory Roadmap issued in June 2022, according to the press release issued by the commission on Friday.
The guidelines have been prepared to encourage listed companies to enhance their ESG disclosures in a fair and transparent manner on voluntary basis, it added.
Since the guidelines are non-mandatory in nature, non-listed companies may also seek guidance from the draft guidelines for embarking on their journey towards adoption of ESG standards.
The draft guidelines cover a wide range of topics under the E, S and G pillars including the recommended metrics related to climate change, Green House Gases emissions, energy usage, gender diversity, executive compensation, non-discrimination, health and safety, board diversity, incentivized pay and internal controls etc.
Under the draft guidelines, the companies have the liberty to disclose their ESG performance by issuing a separate sustainability report, integrating it with the company’s annual report or publishing it online on their website.
The SECP is committed to promoting sustainable and responsible business practices in Pakistan and issuance of the draft ESG guidelines is a significant step forward in this direction, it noted.
By improving ESG disclosures, the SECP aims to improve transparency in company’s operations, promote sustainable business practices to reduce impact on environment and help investors make more informed investment decisions.
