Delay in Singapore's climate reporting stokes concerns about disregard for sustainability in Asia among experts

In a move that has sparked debate among industry players, Singapore has announced a delay in the implementation of mandatory ISSB-aligned climate reporting for most of its listed firms. The revised rules will allow companies with a market capitalization of S$1 billion and above to comply from 2028, while those with under S$1 billion will be expected to follow from 2030.

The decision to delay the implementation has raised concerns about the potential prioritization of sustainability in the region. A Singapore-based sustainability professional expressed worry that the delay could fuel sustainability deprioritization, stating that the republic's decision may set a precedent for other countries to reconsider their own timelines for implementing ISSB standards.

The delay has also been criticized for its "last-minute, haphazard manner," which risks eroding confidence in regulatory efficiency. Industry players have expressed uncertainty about what the five-year delay for the majority of listed issuers is meant to achieve.

Despite the criticisms, the spokesperson from SGX RegCo expects issuers to build on their existing climate reporting disclosures and to demonstrate progress towards incorporating the climate-relevant provisions in the ISSB standards. The aim of the extension is to give these issuers time to build up data collection processes and learn from larger companies that have already embarked on ISSB-aligned climate reporting.

The Accounting and Corporate Regulatory Authority (ACRA) and the Singapore Exchange Regulation (SGX RegCo) are responsible for the delay, aiming to reduce pressure on smaller companies. Over 550 listed companies, representing over 90% of firms listed on the Singapore Exchange (SGX), will be affected by the delay.

All SGX-listed issuers are still expected to start reporting on their Scope 1 and 2 emissions by 2025, but external limited assurance for these reported emissions has been deferred by two years to 2029. Scope 3 emissions, or full-value chain emissions, remain mandatory for STI constituents by 2026 but will become voluntary until further notice for other listed issuers.

The delay comes after calls by the Singapore Business Federation (SBF) for a one- to two-year extension for smaller listed companies to comply with the mandatory reporting rules. Last year, Singapore rolled out a sustainability reporting grant to offset up to a third of the costs of manpower training and consultancy services for companies developing their first ISSB-aligned reports.

The IFRS Foundation, which published Singapore's jurisdictional profile for the first time in June to track progress on the global adoption of ISSB rules, will liaise with the relevant Singapore authorities to update the country's jurisdictional profile in response to the revised rules.

Benjamin Soh, co-founder and managing director of ESGpedia, suggested that using the time to simplify reporting rules and improve disclosure quality could make the delay worthwhile. The role of a carbon accounting platform, such as ESGpedia, is to streamline data all in one place, because businesses will have to calculate their emissions either way, even without ISSB implementation, for procurement, clients or tenders.

The delay is unlikely to reduce the demand for carbon accounting services that platforms like ESGpedia offer. However, Singapore's revised rules now put the city-state behind Malaysia in mandatory sustainability reporting requirements, as listed and large non-listed firms in Malaysia are expected to start ISSB-aligned reporting, including on Scope 3 emissions, by 2027.

Delay in Singapore's climate reporting stokes concerns about disregard for sustainability in Asia among experts