SET raises the bar for corporate sustainability disclosure practices

By: Pakorn Peetathawatchai, President, The Stock Exchange of Thailand (SET) Nov 2018

The Stock Exchange of Thailand (SET) is fully committed to supporting economic development in line with the UN Sustainable Development Goals (SDGs). In addition, we strongly encourage our companies to adopt sustainable practices and sustainability reporting.

As a result, Thai blue chip companies have demonstrated outstanding performances in global sustainability assessments reviewed by leading sustainability index providers such as Dow Jones, FTSE Russell and MSCI. SET is in the process of supporting medium-sized firms through their sustainability practices, particularly in innovation and supply chain management to drive operational excellence.

Recently, SET was awarded 'Best Emerging Market with Outstanding Sustainability Disclosure' by the UN that acknowledges that our market has integrated sustainability into corporate practices. Also, SET is ranked 7th among the 35 global stock exchanges participating in the UN Sustainable Stock Exchange Program, demonstrating the exceptional sustainability disclosure practices of Thai listed companies.

Next, SET aims to further support Thailand’s large cap firms by encouraging them to adopt the globally-accepted Global Reporting Initiative (GRI) Standards through workshop-based activities.

We will also support mid and small cap firms by launching our new SET Sustainability Reporting Guidelines with environmental, social and governance (ESG) qualitative and quantitative indicators that cover climate change, human rights and innovation issues by 2019. At the moment, SET is in a pilot phase with selected listed firms from several business sectors, before the official launch of the SET Sustainability Reporting Guidelines. To ensure the practicality of the Guidelines, SET has been working closely with its partners, including sustainability reporting standard-setter GRI, leading sustainability index providers (FTSE Russell and MSCI), ESG data providers (Bloomberg and Morningstar), local and global asset management firms (Arabesque, Kasikorn Asset Management, Tisco Asset Management) and sustainability consultants (BSR and ERM Siam). The Guidelines will upgrade the entire market’s disclosure practices, and will promote the availability of investor-relevant and decision-useful information on ESG aspects.

Currently, there are 20 CG and ESG-themed funds with net asset value of $840 million available for investors. In addition, SET has recently provided investors with Thailand’s first sustainability index, the Thailand Sustainability Investment Index (SETTHSI), with a total of 45 outstanding-ESG-performance listed companies.

With this progress of ESG disclosure and information, SET expects to see an increase in sustainable and responsible investment in the region in the near future. We will continuously raise the bar for Thai corporate sustainability disclosure practices, and will support investors in their efforts to contribute to the sustainability of the Thai capital market ecosystem.