Malaysia’s launch of the National Sustainability Reporting Framework (NSRF) on September 24, 2024, marks a significant step towards enhancing corporate transparency and aligning Malaysian businesses with global sustainability standards. This framework, developed by the Advisory Committee on Sustainability Reporting (ACSR), incorporates the International Sustainability Standards Board’s (ISSB) Sustainability Disclosure Standards as its baseline.
Key Highlights of the National Sustainability Reporting Framework
1. Phased Implementation:
The NSRF will be rolled out in stages, with different timelines for various groups of companies
This phased approach gives companies more time to adapt, especially smaller businesses that may require additional resources.
2. Ensuring Transparency and Accountability:
The framework also includes key measures to strengthen transparency and accountability:
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Assurance Plans: The ACSR plans to mandate independent verification of sustainability information, starting with Scope 1 and Scope 2 GHG emissions. This will ensure that reported data is accurate and reliable.
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Climate Disclosures: The NSRF incorporates recommendations from the Taskforce on Climate-related Financial Disclosures (TCFD). These disclosures are already part of Bursa Malaysia’s Listing Requirements and focus on how companies manage climate-related risks and opportunities. Aligning with these recommendations enhances consistency and investor confidence.
The NSRF offers transition reliefs for implementing sustainability reporting, initially focusing on climate-related disclosures and extending deadlines for more complex requirements such as Scope 3 GHG emissions. This phased approach enables companies to introduce sustainability and climate disclosures gradually, easing the shift toward comprehensive reporting practices.
Support for Medium and Smaller Businesses
To further support businesses during this transition, particularly small and medium enterprises, the ACSR has launched the PACE initiative (Policy, Assumptions, Calculators, and Education). This program provides essential resources, toolkits, and capacity-building support to help these businesses adapt to the new sustainability reporting requirements. By offering tailored assistance, the PACE initiative ensures that medium and smaller enterprises can effectively navigate the challenges posed by the NSRF and successfully integrate sustainability practices into their operations.
Public Consultation
In conjunction with the NSRF launch, Bursa Malaysia has opened a public consultation on proposed amendments to its listing requirements. This consultation, which seeks feedback until October 25, 2024, also includes proposed relief measures to ease compliance and additional changes related to the mode of general meetings and the publication of IPO advisers’ names.
By implementing this framework, Malaysia joins over 20 jurisdictions taking steps to implement global sustainability reporting standards. This move reinforces the nation’s commitment to sustainable business practices, improves business resilience, and enhances investor transparency in the global market.
Your Partner in Navigating the National Sustainability Reporting Framework
As Malaysia enters a new era of sustainability reporting, ESC is here to help your organisation meet the National Sustainability Reporting Framework (NSRF) requirements. This framework signifies a major shift in corporate reporting, and we understand the challenges businesses face. Our team offers local insights and international expertise, backed by extensive regulatory experience, to help you achieve your sustainability goals. Contact ESC’s sustainability consultants for tailored support with the NSRF.