Yesterday (Monday, September 12), the Monetary Authority of Singapore (MAS) and Singapore Exchange Group (SGX Group) announced the launch of ESGenome, a digital data platform that aims to enhance ESG reporting among Singapore-based corporates.
Hosted by UK-headquartered ESG data-focussed firm, World Wide Generation (WWG) as a live Software-as-a-Service (SaaS) solution, ESGenome is the result of a joint initiative to explore the development of a common disclosure process for SGX-listed companies. It is hoped that the digital disclosure portal will contribute to the wider Asian sustainability effort.
“The collaboration between MAS and SGX Group is an excellent example of the effect when public and private sectors come together to address challenges faced by companies and investors in ESG reporting,” Kum Kong Chan, managing director and head of research at SGX Group told FinanceAsia.
Through ESGenome, companies can carry out their baseline sustainability reporting using a set of 27 ESG metrics that were compiled by SGX following public consultation with its investor base. Ranging from total corporate energy consumption to new hires and turnover by gender, it is this set of core “ESG DNA” that gives the platform its name.
“The portal will contain the key ESG information needed in any [corporate] sustainability journey,” CEO of SGX Group, Boon Chye Loh, said at the platform’s launch at the Securities Market Opening Ceremony.
Confirming that the platform is available to all SGX-listed firms on a voluntary basis and at zero cost, Chan told FA that it had been designed to support companies amid a backdrop of increasing regulatory and legal focus on sustainability reporting, as well as sustainable procurement across the breadth of global supply chains.
“Companies’ readiness will need to be taken into consideration for any compulsory use of the platform.” He added that as part of ongoing enhancements, there are plans to build connectivity to corporates’ internal platforms.
Project Greenprint
Chan explained that SGX Group began the conceptualisation of the platform two years ago and “was pleased to see it dovetail into MAS’ Project Greenprint initiative.”
Project Greenprint was launched by MAS in December 2020, to investigate how technological innovation can be used to promote a green finance ecosystem in the region. As part of this, in November 2021, the government body announced its partnership with industry to pilot four digital platforms.
Prior to its official launch, forty listed companies trialled ESGenome, including CapitaLand, First REIT, Lendlease Global Commercial REIT and Singtel, offering feedback ranging from functionality enhancements, to suggestions on the presentation of metrics.
Chan shared that in order to compile a robust set of commonly reported metrics SGX Group reviewed over 330 sustainability reports published by its listed companies during the last three years and over 12,000 data points. The criteria was also mapped across key global standards and frameworks.
“These metrics are quantitative in nature, relevant to most sectors and are rooted in the reality of the current reporting landscape in Singapore,” he said.
“In such a way, we hope to shape disclosure behavior of companies so as to steer them away from narrative-driven reports.”
He added that companies are not restricted to inputting annual data into ESGenome, that they can input quarterly or monthly data for additional, internal tracking.
Singapore as a sustainability hub
Optimistic that companies will find the platform useful and that its utilisation rate will grow, Chan said that he hopes the platform’s launch puts Singapore at the forefront of establishing a decision-useful ESG dataset at scale, one that is standardised and comparable for investors, financiers and banks to direct capital effectively.
“There is good progress made by companies in their ESG disclosure journeys, however many are still faced with challenges such as mounting requirements, intensive investor surveys and the misalignment with the needs of their investors or financiers.”
“The gap between reporting companies and users of ESG data may be narrowed once the International Sustainability Standards Board (ISSB) has established the global baseline for sustainability reporting.”
“However, in the meantime, there is an urgent need to support our companies with the necessary guidance and tools to prepare them for this next wave of thematic and impact investment strategies, and their corresponding data requirements,” Chan said.
In addition to MAS, SGX and WWG, the Association of Banks in Singapore (ABS), EY, the Investment Management Association of Singapore (IMAS), SAS, the Singapore Institute of Directors (SID) and the Sustainability Reporting Advisory Committee (SRAC), participated in the development of ESGenome.
